Continued growth for Imbalie Beauty underlines positive outlook

12 November 2012, Johannesburg. JSE-listed Imbalie Beauty (formerly Skinwell Holdings Limited) has posted positive reviewed results for the interim period ended 31 August 2012. The group has retained its stronghold as the largest beauty franchise group in South Africa, with a comprehensive beauty offering of nail, hair and skincare through its bouquet of established brands. This is clearly demonstrated by the 63% increase in system-wide sales revenue for the interim period, taking the system-wide sales to R99.1 million. Group revenue rose by 14.1% to R34.9 million which reflects an increase of R4.3 million on the group’s 2011 results during the same period. Specific care has been taken over the last six months to define a clear strategy differentiating their main salon brands including, Placecol Skin Care Clinics, Dream Nails Beauty Salons and Perfect 10 Nails & Body Studios from one another. This long-term vision, coupled with outstanding growth over the interim period again highlights Imbalie Beauty’s definite long-term investment potential…

Imbalie Beauty’s latest interim financial results reflect an actualisation of their vision to become the largest and most desirable Beauty Franchise Group. Their strategy of ongoing re-investment in the group has compounded their already strong foothold in the market with the successful incorporation of their latest acquisition; Perfect 10 Nail and Body Studios. A focal point during this process was the thorough systemisation of the Studios. “We are proud to welcome Perfect 10 to our family.” says Esna Colyn, CEO: Imbalie Beauty. “We believe that the synergising of this established brand into our family of legacy brands is a good fit and look forward to growing it further. This is why we have devoted special attention to the strengthening of the Imbalie Beauty Training Academy in order to provide business and beauty training for all our franchisees and their staff, and have established of a Learnership Programme for nail technicians.”

Colyn maintains that the key to Imbalie Beauty’s success lies in the support and vision they lend to their franchisees: “Realising the full potential of our diversified offering means achieving clear differentiation of our main salon brands while continuously presenting a modern, fresh look that encapsulates the brand. Project Facelift has provided the perfect platform from which we have refreshed our current franchises while keeping the essence of each brand intact.” The group’s ongoing focus on staff training as well as providing post development training to all salons ensures brand service excellence levels across the group. “We firmly believe in driving innovation and marketing, our latest example being the introduction of state of the art hair removal and skin rejuvenation technology into the Placecol Skin Care Clinics.” says Colyn, “We have also expanded our consumer driven focus through the introduction of the Placecol Care Loyalty Programme.” These core group values continue to attract new “owner-operators”. While the group has many new franchise opportunities currently on offer, its commitment to its franchisees demands prudence when opening new stores, in order to ensure sustainable franchisee profitability.

Colyn reiterates her belief that Imbalie Beauty’s positioning will add value to JSE investors looking for long-term returns: “Although our operating expenses show an increase of 7.9% this is attributed to the once off expenses relating to the integration of the Perfect 10 acquisition as well as our name change to Imbalie Beauty Limited. Overhead structures were strengthened during the interim period, but will be monitored closely to ensure cost effectiveness for the remainder of the financial year.” Colyn explains, “With regards to the funding of the acquisition, the company completed a general issue of shares for cash whereby 109 375 000 ordinary shares were placed with a number of independent public shareholders at a price of 16 cents per share. This together with a loan agreement settled the purchase consideration.” She adds that Imbalie Beauty’s acquisition of the Perfect 10 brand has strengthened the balance sheet.

With sustained growth this year well-reflected in the latest interim financial results, Colyn believes Imbalie Beauty is on the path to achieving its long-term vision: “We are already seeing a keen focus on marketing and innovation through the appointment of wellness specialist and industry entrepreneur Hilda Lunderstedt (B.Sc [Pharm]) as non-executive chairperson. Her wealth of knowledge together with the retained experience and expertise of Theo Schoeman (formerly independent chairman) and the dedication and hard work of every single member of the group, continues to drive growth opportunities in line with our vision. Once again we are extremely proud of our results and our ongoing ability to deliver sustained investment returns at both a brand and group level. We look forward to driving continued profitable growth in 2013.”

Kyla Derrick

Letsema Communications