Vita Group delivers strong interim performance

Vita Group delivers strong interim performance

Vita Group Limited (ASX: VTG) today reported strong performance for the six months to 31 December 2016. The group delivered an 8 per cent increase in revenues from continuing operations to $344.1 million and a 15 per cent uplift in underlying earnings before interest, tax, depreciation and amortisation (EBITDA) from continuing operations to $35.0 million.

The group delivered an 8 per cent increase in revenues from continuing operations to $344.1 million and a 15 per cent uplift in underlying earnings before interest, tax, depreciation and amortisation (EBITDA) from continuing operations to $35.0 million.

Growth in earnings and strong cash generation enabled the group to continue to invest in its businesses and reward shareholders with higher dividends. With no net debt at the end of the half, Vita retains significant flexibility to invest in growth opportunities in line with its strategy.

The Board declared a record dividend of 9.20 cps fully franked – a 60 per cent increase on the prior year – to be paid on 7 April 2017 to shareholders on record as at 10 March 2017.

The results reflect Vita‘s continued execution of its strategy to optimise its retail channel and to transform and scale its business channels, whilst exploring further opportunities for growth as it continues to evolve.

The retail channel delivered another strong result whilst the group’s small-to-medium business (SMB) and enterprise channels continued their growth trajectory. Vita’s accessories brand Sprout, grew in both Vita and third party distribution channels, demonstrating the group’s ability to deliver value across a range of categories.

Chief Executive Officer, Maxine Horne commented: “We are pleased to deliver a strong result, in line with our clear strategy. At our core, we are a consultative-sales organisation providing our customers with holistic solutions. We intend to continue to use our core competencies to evolve and deliver sustainable value now and into the future. This is evidenced by the growth in our Sprout accessories business and the October launch of SQDAthletica, a men’s apparel and accessories brand which, whilst immaterial in terms of cost in the short term, demonstrates our intent to apply our competencies to categories with attractive characteristics. We will continue to explore other new opportunities.”

OPERATING HIGHLIGHTS

Group revenues from continuing operations grew 8 per cent to $344.1 million, with growth across all channels.

Retail channel revenues increased 5 per cent, with growth in fee income offset by slower growth in low margin device sales. The group continued to focus on improving the productivity of its existing store portfolio and reducing performance variability, whilst at the same time lifting average store earnings through targeted additions to the store network. Vita benefited from the acquisition of three Telstra stores during the period and closed one store. EBITDA from the retail channel grew 12 per cent with like-for-like EBITDA up 7 per cent.

The SMB channel achieved a 35 per cent increase in revenue, with growth occurring across all key product categories. The team continued to embed leadership disciplines and operating rhythms, whilst working with Telstra to evolve the strategy for this channel, with the expectation that retail points of presence and enterprise expertise will both play a more prominent role in servicing SMB customers in the future.

Enterprise channel revenues grew by 16 per cent, off the back of key account wins; with the channel building a solid customer pipeline to deliver future returns. Whilst the group’s business channels are gaining traction, there is much work to do to enable these channels to reach their potential and deliver a meaningful EBITDA contribution to the group.

Sprout revenue increased by 28 per cent, with growth coming from both internal distribution channels and from the expansion of the third party customer base.

Gross margins rose, due to a higher relative contribution from the business channels combined with a change in product mix sold in retail. This was partly offset by slightly softer unit margins in the second quarter, and the elimination of gross margin from the now expired proprietary product, ESP, which contributed $3.1 million in H1 FY16.

As at period end, Vita retained a healthy balance sheet position with no net debt.

SECOND-HALF OUTLOOK

Subsequent to agreeing changes in commercial terms with Telstra (as communicated in Vita’s ASX announcement on 25 November 2016), there will likely be some softening of profitability on a per connection basis in the second half of the financial year.

However, Vita expects to deliver improved productivity from its retail network and is targeting continued momentum in the performance of its business channels. Additionally, Vita will further increase its retail presence with the acquisition of five Telstra stores which in the short-term, takes its Telstra licensed store portfolio to 107.

Further optimisation of the portfolio is expected, with acquisitions, divestments and closures likely. Vita’s clustered network of stores enables an intensity of leadership to drive greater productivity and exceptional customer experiences.

“As we enter the second half, our proven ability to execute will assist in sustaining the performance momentum we have created,” said Ms Horne. “As always, our ability to perform and evolve comes down to our people, who are the key to our success. We delivered a great result, which continues a long track record of strong performance. Moving forward, we’re excited about the next phase of our strategy. As well as continuing to drive returns from our telecommunications business, we are actively looking for opportunities to take what we’re good at – our competencies – and apply them in other attractive categories, in addition to those that we are already in. We look forward to continuing to create value for all our stakeholders and making Vita an even greater place to be.”

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Artisan Aesthetic Clinics adds Euphoria Cosmedic Clinic

Vita Group (ASX: VTG) has acquired Euphoria Cosmedic Clinic on the Gold Coast under its Artisan Aesthetic Clinics brand. Founder of Euphoria and highly skilled registered nurseRachel Gregory will join the team at Hope Island Road on Tuesday 4 Maybringing her significant cosmetic injectables expertise to the clinic. 

With more than 24 years of medical experience including 15 years in aesthetic treatments, Rachel has established herself as one of the Gold Coast’s most respected cosmetic injectors, known for delivering natural looking results in a professional, friendly and caring wayThe clinic has a particular focus on delivering premium cosmetic injectable treatments including anti-wrinkle, dermal filler and PDO threads.

Maxine HorneVita Group’s Chief Executive Officer, said: “We are very pleased to welcome Rachel to the Artisan teamShe will add significant value to our Hope Island Road clinic, expanding the clinic’s capability in the field of cosmetic injectables and further reinforcing the premium, personalised experience we provide to our clients.”

Artisan Aesthetic Clinics launched in 2018 with the opening of Artisan Racecourse Road in Brisbane, Queensland. Through its focus on appointing a team of highly-skilled clinicians to deliver holistic treatments and technologies in a premium environment, the brand has quickly established itself as one of Australia’s leading cosmetic clinic networks.

Artisan currently operates 20 clinics across Australia, three of which are on the Gold Coasta high-demand location for non-invasive cosmetic treatments in Australia.

Artisan Aesthetics Group – clinic network

Queensland

  • Artisan Racecourse Road, Hamilton 
  • Artisan Gasworks, Newstead
  • Artisan Rosalie Village, Rosalie
  • Artisan Fortitude Valley
  • Artisan Bulimba
  • Artisan Maroochydore
  • Artisan Hope Island Rd
  • Artisan Kenmore
  • Emetheni, Burleigh Heads 
  • The Bradford Clinic, Toowoomba
  • Face Today Mediclinic, Cairns
  • HC Medical, Robina

New South Wales

  • Artisan Balmain
  • Artisan Mosman  
  • Lily Room, Chatswood 
  • Coco Skin Laser Health, Newcastle

Australian Capital Territory

  • Artisan Bruce  
  • Artisan Woden 
  • Artisan Gungahlin

Victoria

  • Pamper Medical Skin Clinic, Geelong 
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Sprout accessories achieves ISO certification

Vita Group’s Sprout accessories brand has been awarded two Best Practice ISO certifications, strengthening its reputation as a best-in-class manufacturer and leading provider of technology accessories in Australia.

The certifications – Best Practice Quality Management System (ISO9001) certification and Best Practice Environment Management System (ISO14001) certification – are based off international standards set by the International Organisation for Standardization. They demonstrate that an organisation’s product or service meet the expectations of its customers and reflect Sprout’s commitment to sustainability and creating technology that enhances the world not just today, but into the future.

To achieve ISO9001 and ISO14001, the business met a comprehensive set of requirements which it must now continue to meet to maintain certification. ISO certification delivers significant business benefits including improved customer satisfaction, cost reduction, improved legal compliance and risk management, and importantly, environmental benefits for Sprout and for its suppliers.

For Sprout General Manager, Ben Caddy, achieving ISO certification was an important step in the brand delivering its ten-year sustainability action plan which aims to address key elements across the end-to-end product value chain.

“At Sprout we are always aiming to improve our customer experience and quality standards, and ISO ensures we do that,” he said. “ISO9001 enables us to demonstrate our ability to provide products and services that consistently meet regulatory requirements, whilst ensuring the smooth operation of our business and exceeding our customers’ expectations. Another major focus for Sprout is to reduce our carbon impact,” Mr Caddy continued. “The standards in ISO14001 help us to define the right targets and measure and track our results to ensure that the business is constantly improving and meeting our environmental objectives.”

Sprout’s ten-year sustainability action plan involves implementing key initiatives including sourcing recyclable materials for packaging and product development, continuing to drive ethical and socially responsible supply chains, reducing carbon emissions, and designing more sustainable multi-use and eco-friendly products.

The brand is already underway in implementing these initiatives, recently launching a campaign in partnership with One Tree Planted that will see it fund the planting of ten trees for every product sold online from 21 March to 29 June. To date, Sprout has funded the planting of nearly 2,600 trees and is aiming for 10,000 trees planted by the end of June to help One Tree Planted’s reforestation efforts following the 2019/20 Australian bushfires.

Sprout is also set to move to 100% recyclable packaging towards the middle of 2021 which will include switching from foam to recycled pressed cardboard, removing non-recyclable plastic windows, and extensive use of bamboo pulp in packaging.

Compostable phone cases are also in development and due to launch later in the year. These cases will see 90% biodegradation of plastic material within 12 weeks in commercial compost systems or 12 months if composted at home.

Mr Caddy said ISO certification will ensure Sprout is held accountable for these environmental initiatives as well as its sustainability targets. It will also ensure the business is continuously improving its manufacturing and environmental management systems to the benefit of its customers and the world around it.

“ISO certification is extremely important to the business as it ensures we have the tools, processes and systems to meet our business targets,” he said. “ISO certification also places the business in a constant state of improvements so that we can not only show improvement year-on-year, but also regularly monitor our important sustainability objectives and put the processes in place to achieve them.”

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Artisan Aesthetics Group reaches 20 clinic milestone with new acquisition  

Artisan Aesthetics Group (AAGcontinues to grow with the acquisition of Coco Skin Laser Health on 19 February 2021, bringing its network to 20 clinics across Queensland, New South Wales, the Australian Capital Territory and Victoria. 

Located in the beautiful harbour city of Newcastle, New South Wales, Coco Skin Laser Health has been a fixture in the local community for nearly 10 years, building a strong reputation for helping clients to look and feel more confident through beautiful, healthy skin. 

The clinic’s experienced team of 15 is comprised of dermal therapists, cosmetic nursesdoctorsand the front of house team. The Coco team will join Artisan and will continue their focus on creating personalised treatment plans containing a combination of therapies to support clients with their skin health and wellness goals. The experienced clinicians use non-surgical techniques and combination therapies to help clients to manage the signs of ageing and sun-damageAt Coco, the aim is to enhance their clients’ best features, improve their complexion, and lift and tone sagging skin. 

As part of the Artisan network, Coco Skin Laser Health will continue using industry leading clinic management software program, cosmedcloud™, and the team will gain access to clinical training through Artisan’s Clinical Education and Training division. The clinic, which has experienced strong growth post-COVID with a high volume of new clients, will continue to offer an extensive menu of treatments including laser and light therapies and cosmetic injectables including biostimulator treatments such as platelet rich plasma (PRP), while benefiting from Artisan’s ongoing investment in the latest treatments and technologies.  

Vita Group CEO, and founder of Artisan Aesthetic Clinics, Maxine Horne, said she is excited to mark the group’s 20th acquisition and welcome Coco Skin Laser Health to the group as it continues to establish itself as a leader within the premium end of Australia’s aesthetics industry, operating a national network of 70 premium clinics over the next five years.  

Coco Skin Laser Health is an excellent addition to our portfolio. As with Artisan, the clinic and its team are known for delivering exceptional, personalised servicewith a combination of treatments that achieve high-quality results for their clients. We are excited to welcome them to the Artisan family and to extend Artisan’s service offering further. 

Artisan Aesthetics Group – clinic network

Queensland

  1. Artisan Aesthetic Clinic, Racecourse Road, Hamilton 
  2. Artisan Aesthetic Clinic, Gasworks, Newstead
  3. Artisan Aesthetic Clinic, Rosalie Village, Rosalie
  4. Artisan Aesthetic Clinic, Fortitude Valley
  5. Artisan Aesthetic Clinic, Bulimba
  6. Artisan Aesthetic Clinic, Maroochydore
  7. Artisan Aesthetic Clinic, Hope Island
  8. Artisan Aesthetic Clinic, Kenmore
  9. Emetheni, Burleigh Heads 
  10. The Bradford Clinic, Toowoomba
  11. Face Today Mediclinic, Cairns
  12. HC Medical, Robina  

New South Wales

  1. Artisan Aesthetic Clinic, Balmain
  2. Artisan Aesthetic Clinic, Mosman 
  3. Lily Room, Chatswood 
  4. Coco Skin Laser Health, Newcastle 

Australian Capital Territory

  1. Artisan Aesthetic Clinic, Bruce  
  2. Artisan Aesthetic Clinic, Woden 
  3. Artisan Aesthetic Clinic, Gungahlin

Victoria

  1. Pamper Medical Skin Clinic, Geelong  
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