Dentistry: Inc Impact of COVID-19 - UK - July 2020

OVERVIEW
Key issues covered in this Report
Products covered in this Report
COVID-19: Market context
Economic and other assumptions
EXECUTIVE SUMMARY
Market Size
Steep decline in 2020 dental care expenditure as COVID-closure halts all services in Q2
Figure 1: Total UK dental care expenditure, 2016-2020, (£ billion)
High infection-risk nature of the industry will dampen growth over the foreseeable future
Figure 2: Forecast UK expenditure on dental care, by provider, 2021-2025, (£ billion at 2020 prices)
Impact of COVID-19 on Dentistry
Figure 3: Expected impact of COVID-19 on dentistry, short-, medium-, and long-term, [10 July 2020]
The consumer
95% of people have seen an NHS dentist whilst 54% have never visited a private dentist
Figure 4: Last dental appointment, by time of last appointment and service type, May 2020, (% of respondents)
People are most satisfied with the cleanliness and good hygiene of practices
Figure 5: Dental services opinion, by highest six ‘agreement’ statements, May 2020, (% of respondents)
Seeing the same dentist and regular check-ups remain high priority
Figure 6: Dental industry issues, May 2020, (% of respondents)
What we think
THE IMPACT OF COVID-19 ON DENTISTRY
The market
Fewer patient appointments and rising PPE costs will dampen growth over the foreseeable future
High infection-risk nature of the industry will alter the industry operation model 
Government measures
NHS dentistry
Private dentistry
The consumer
Dental professionals will need to remove patient ‘fear factor’ post-lockdown
Companies and brands
Dental groups join up to produce back-to-work guidelines
Mydentist becomes first main provider to increase dental charges to cover PPE costs
Water Pik and Tooth Fairy partner up to help connect patients with dentists
The future
COVID-19: Market context
ISSUES AND INSIGHTS 
Despite slowly reopening, severe doubts remain on the viability of many practices
The facts
The implications
Low NHS dentist wellbeing adds to recruitment problems
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Steep decline in 2020 dental care expenditure as COVID-closure halts all services in Q2
The high infection-risk nature of the industry will dampen growth over the foreseeable future
MARKET SIZE
Steep decline in 2020 dental care expenditure as COVID-closure halts all services in Q2
Figure 7: Total UK dental care expenditure, 2016-20, (£ billion)
NHS treatment costs frozen until October 2020 due to pandemic
Figure 8: NHS dental charges in England, per band, 2016-20*, (£)
Market Segmentation
Segment Overview
Figure 9: Total UK dental care expenditure, by provider, 2016-20, (£ billion)
Private Treatments
Cosmetic dentistry expected to be hit hardest by COVID-19 closure in 2020 but strong demand remains
Figure 10: UK expenditure on private cosmetic dental care, 2016-20, (£ billion)
NHS Dentistry
Figure 11: UK expenditure on NHS dental care, by payment segment, 2016-20, (£ million)
Courses of NHS band 1 and urgent treatments rise in 2019
Figure 12: Number of courses of dental treatment under the NHS in England, 2014/15-2018/19, (000s)
MARKET FORECAST
Short-, medium- and long-term impact on the industry
Figure 13: Expected impact of COVID-19 on dentistry, short-, medium-, and long-term, 10 July 2020
The high infection-risk nature of the industry will dampen growth over the foreseeable future in a post-COVID environment
Figure 14: Forecast UK expenditure on dental care, 2021-2025, (£ billion at 2020 prices)
All market sectors will be hit by the impact of the pandemic, but private dentistry is likely to drive growth as it has greater flexibility with dental fees
Figure 15: Forecast UK dental care expenditure, by segment, 2021-2025, (£ billion at 2020 prices)
GDC launches strategy for the next three years
Advancements in technology will help drive innovation and cost-efficiency in a time where both are very much needed
THE IMPACT OF THE ECONOMY
Annual GDP growth falls to decade low in 2019 and is expected to significantly decline in 2020 due to large economic shutdown
Figure 16: Annual GDP growth rate, 2015-2020*, (%)
Bank rate set at a record low of 0.1%
Figure 17: Bank rate, 2008-2020, by date of adjustment, (%)
Household real incomes strained as the effects of the pandemic begin to hit
Figure 18: GDP per head at current market prices and real household disposable income per head, Q1 2016 – Q1 2020, (£)
MARKET TRENDS
Dental earnings fall once more but 2019/20 sees first real-term uplift in basic pay increase in 14 years
Figure 19: Average taxable income for all self-employed primary care dentists, England and Wales, 2013/14-2017/18, (£)
Figure 20: Associate Rates per UDA, by Region, (£)
Dental practice profits rise in 2019 after falling in 2018
Practices remained in demand with buyers up to Q1 2020, but a shift towards NHS has occurred in light of the pandemic
Orthodontic treatments remain popular but patients are warned about ‘DIY’ sets
MARKET DRIVERS
With Brexit confirmed in January 2020, the impact on recruitment and costs has begun
Ageing population will maintain strong dental treatment demand
Figure 21: UK population estimate and projection, 2020 and 2025, by age group, (millions of people)
NHS dentist activity rises whilst the number of patients stagnates
Figure 22: Dentists with NHS activity in England, 2014/15-2018/19, (No. of dentists and % annual change)
Figure 23: Dental patients seen in England under the NHS over the previous 24 months, at 30 June, 2015-19, (000s of patients)
Student intake levels above target, but vacancies remain for current dental positions
Figure 24: Target number of dental students and actual intakes in England, 2013/14-2019/20, (Number of students)
COMPANIES AND BRANDS – WHAT YOU NEED TO KNOW
Colosseum Dental UK rolls out advanced tech to all of its practices
Mydentist launches ‘affordable’ private dental service
INDUSTRY STRUCTURE
Investor demand remains higher than supply for practices with stable average price growth
UK ranks second in Europe for best oral health
Market Share
Figure 25: Number of UK dental practices, 2018, by corporate operator and ownership, (Number)
Recent M&A activity
Sector structure
Figure 26: Analysis of changes in the structure of the dental practice sector, 2015-2019, (Number of companies and practices)
Figure 27: Analysis of the employment structure of the dental practice sector, 2018 and 2019, (Total employees and number of companies)
Figure 28: Analysis of the financial structure of the dental practice sector, 2018 and 2019, (£000 and number of companies)
COMPETITIVE STRATEGIES
Colosseum Dental UK rolls out advanced tech to all of its practices
Mydentist launches ‘affordable’ private dental service
COMPANY PROFILES
Bupa Dental Care
Recent company activity
Financial information
Figure 29: Financial analysis of Bupa Dental Care, 2014-2018, (£ million)
Colosseum Dental Services
Recent company activity
Financial information
Figure 30: Financial analysis of Colosseum Dental Services, 2014-2018, (£ million)
DPAS
Financial information
Figure 31: Financial analysis of DPAS, 2014-2018, (£000)
Mydentist (formerly IDH Group)
Recent company activity
Financial information
Figure 32: Financial analysis of Turnstone Equityco 1, 2014-2018, (£ million)
Subsidiary Companies
Figure 33: Financial analysis of Whitecross Dental Care, 2015-2019, (£ 000)
Figure 34: Financial analysis of Petrie Tucker and Partners, 2015-2019, (£ million)
Figure 35: Financial analysis of Orthworld 2000, 2015-2019, (£ million and % change)
Practice Plan
Figure 36: Financial analysis of Practice Plan, 2014-2018, (£ million)
Rodericks Dental Limited
Recent company news
Financial information
Figure 37: Financial analysis of Rodericks, 2015-2019, (£ million)
Denplan (part of Simplyhealth)
Recent company activity
Financial information
Figure 38: Financial analysis of Simplyhealth Professionals, 2014-2018, (£ million)
THE CONSUMER – WHAT YOU NEED TO KNOW
95% of people have seen an NHS dentist whilst 54% have never visited a private dentist
People are most satisfied with the cleanliness and good hygiene of practices
Seeing the same dentist and regular check-ups remain high priority
LAST DENTAL APPOINTMENT
95% of people have seen an NHS dentist compared to 54% who have visited a private dentist
Figure 39: Last dental appointment, by time of last appointment and service type, May 2020, (% of respondents)
Likelihood of most recent NHS visit rises alongside age
Figure 40: Last NHS dental appointment, by time of last appointment and by age and gender, May 2020, (% of respondents)
Figure 41: Last private dental appointment, by time of last appointment and by age and gender, May 2020, (% of Respondents)
DENTAL TREATMENT
General examination/check-ups account for two thirds of all treatments
Figure 42: Dental treatment, May 2020, (% of respondents)
More check-ups and x-rays conducted over the last year
Figure 43: Dental treatment, by time of Last NHS visit, May 2020, (% of respondents)
Figure 44: Dental treatment, by time of last private visit, May 2020, (% of respondents)
SERVICE OPINION
People are most satisfied with the cleanliness and hygiene of practices
Figure 45: Dental service opinion, May 2020, (% of respondents)
DENTISTRY ISSUES
Seeing the same dentist and regular check-ups remain high priority
Figure 46: Dentistry issues, May 2020, (% of respondents)
DENTAL CHOICE FACTORS
Location and cost influence choice
Figure 47: Dental choice factors, May 2020, (% of respondents)
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Methodology
FURTHER SOURCES AND CONTACTS
Trade associations
Trade magazines
Trade events