Vet chain spends up on efficiencies
ORMEAU-BASED National Veterinary Care (NVL) will take a hit to its first-half profit, as it spends up on technology to forge a lean, but still hungry, business.
NVL, which listed in 2015 at $1 per share, has been on an acquisition spree in the first half of the financial year, acquiring 11 more veterinary clinics.
Investors have responded positively with the share price soaring to $3.15 earlier this month, although it has since come back to close at $2.86 yesterday.
Managing director Tomas Steenackers, a former Greencross executive, said the company is focused on streamlining its finance, human resources and payroll processes, to create synergies as it continues to grow.
“This year is really about trying to find efficiencies,” he said. “It will cost more money but in the long term it will help us develop a better, more sustainable and more profitable business.”
Mr Steenackers said an example involved its new hiring process, which used to take two hours per candidate.
“Now it is done electronically,” he said. “Our system sends a text and an email to the new candidate, saying, ‘congratulations you have the job’. The candidate prefills the information, contract, bank and super details etc. And when they click to accept the job, the information is sucked into the system.”
Mr Steenackers said last
year they hired 300 people and this process, if applied now, would save 600 hours of labour.
“If I double the size of the organisation now, and add 1000 people, I don’t need to add more people to pay bills because of the technology. However, installing those systems costs money and takes time so that is really our focus this year.”
Mr Steenackers said the costs involved would mean 1H17 net profit took a hit, compared to the same period last year when it was $2.6 million.
NVL, which targets six to 10 acquisitions per year, has in FY18 already exceeded that number. But Mr Steenackers said that did not mean new acquisitions weren’t a possibility.
He said a significant development this year would be the opening of a 500sq m training centre in Melbourne in the next few months, and later this year an additional facility in New Zealand.
He said FY18 revenue guidance, at 25 per cent above the $66.8 million reaped in FY17, remained the same.
NVL will report its first-half results on February 26.