Dental group and takeover target Abano Healthcare's half year profit has fallen sharply on one-off costs and a struggling Australian business.
The owner of Lumino The Dentists in New Zealand and Maven Dental Group in Australia, made a net profit of $115,000 for the six months ended November, compared with $6 million in the same period last year.
Revenue rose about 3 percent to $146.2m, but its Australian business is under pressure.
"Management continues to work hard to drive improvements in performance across the network, particularly in the challenging Australian market," chief executive Richard Keys said.
The company last year changed its focus from acquiring dental practices to getting more growth out of those already owned.
"Recruitment has been a priority for both businesses, and we are pleased to have welcomed a number of new and junior clinicians to the group."
Its bottom line was hit by increased labour costs, and one-off costs of $4.4m to cover accounting changes, and asset writedowns in its underperforming Australian business. Another $1.7m was spent on assessing takeover bids.
A joint venture of two foreign investors has offered to buy Abano for $5.70 a share, valuing it at $150 million.
The scheme of arrangement will be put to shareholders in March.