Vita Group delivers strong interim result

Vita Group delivers strong interim result

Vita Group (ASX: VTG) today reported a strong performance for the six months to 31 December 2018, delivering record revenues of $377.0 million, up 14 per cent on prior year. Earnings before interest, tax, depreciation and amortisation (EBITDA) increased to $25.0 million, 25 per cent higher than prior year, comfortably exceeding the October 2018 guidance range of $23.0 million to $24.5 million. Net profit after tax (NPAT) increased on prior year by 26 per cent to $14.1 million.

The group ended the period with net cash of $17.2 million as a result of strong cash conversion and disciplined management of working capital, investing cash flows and bank debt. Operating cash flows after tax were $13.4 million, whilst a net $6.7 million was invested in acquisitions, fit-outs and technology solutions across Vita’s information and communication technology (ICT) and non-invasive medical aesthetics (NIMA) businesses. Financing outflows were $11.2 million, comprised of $5.3 million in debt repayments and $7.1 million in dividend payments; offset by $1.2 million in proceeds raised through the dividend reinvestment plan. Cash balances were $27.1 million, and bank debt reduced to $9.8 million, leaving the group in a strong net cash position and with the flexibility to invest in growth activities in line with its strategy.

The Board declared a fully-franked interim dividend of 5.2 cents per share, equating to $8.4 million, an increase of 16 per cent on prior year, to be paid on 12 April 2019 to shareholders, on record as at 29 March 2019.

 

($m unless otherwise stated)

H1 FY19
H1 FY18
Change
Revenue
377.0
329.6
14%
Gross profit
115.6
103.3
12%
Gross profit %
31%
31%
EBITDA
25.0
20.0
25%
EBIT
19.9
15.7
27%
NPAT
14.1
11.2
26%
Interim dividend declared
8.4m
7.3m
16%
Interim dividend
5.2cps
4.7cps
11%
Earnings per share
8.8cps
7.3cps
20%
 

Vita’s ICT channels, primarily driven by the retail business, performed strongly, delivering record revenues, with a strong contribution from devices, connectivity and accessory categories, reflecting the group’s continued emphasis on consulting and personalised service. Vita’s proprietary accessory brand, Sprout™ was a standout performer in the period, delivering innovative products across a range of categories. In addition, the focus on servicing small business customers from retail points of presence drove growth in business volumes. EBITDA in the ICT channel increased strongly on prior year as a result of revenue growth, productivity improvements, and continued efficiency gains from the optimisation of the physical store network.

In business ICT, the transition to the new operating model progressed well. The new model will see Vita operate larger format TBTCs (Telstra Business Technology Centres) across four significantly expanded geographic territories, delivering a broader range of ICT products and services to larger, higher value customers, and with a lower cost to serve.

Vita continued to enjoy a strong strategic partnership with Telstra, evidenced by the extension of its Telstra Dealer Agreement and Master Licence for a further year to 2024, announced to the market in December 2018. Vita continues to support Telstra in implementing its strategic objectives.

Significant progress was made in preparing the group’s NIMA business for future growth. Vita launched its premium medical aesthetics brand, Artisan Aesthetic Clinics, and expanded its portfolio to ten clinics across Queensland, New South Wales and the Australian Capital Territory as at period end. The network includes Artisan branded greenfield clinics as well as acquired clinics. Medical, operational, and support structures are now in place and embedded, including the establishment of the Artisan Medical Board. The group also acquired training organisation, Face Academy™, which offers independent training to doctors and nurses within the aesthetics industry; and Cosmedcloud, a leading provider of cloud-based software to the industry. These investments in capability will enhance the group’s medical and operational competencies, and will enable the business to scale further, building revenues and profitability.

Vita’s men’s active and lifestyle brand, SQDAthletica™, continued its journey from a start-up business, increasing revenues in physical, online and wholesale channels, whilst enjoying a significant lift in brand awareness.

Chief Executive Officer, Maxine Horne commented: “We are really pleased to deliver such a strong performance, despite tough conditions in the ICT industry. Our long-term strategic partnership with Telstra remains strong and we will continue to invest in our retail and business channels and enjoy continued profitability and cash flow from this part of our business. Our NIMA business continues to build, in terms of clinic numbers, as well as from a capability perspective, which will stand us in good stead as we scale the business over the next few years. We have made considerable progress in executing our five-year strategy, which is underpinned by our approach to consultative selling, delivering exceptional customer experiences, driving productivity, and controlling costs. As always, our success comes down to our people who continue to out-service, out-execute and out-perform.

“We are achieving strong momentum across the business and are well positioned for the future,” she continued. “We have a very clear strategy for Vita Group which includes cementing our position as a leader within the industries we operate in. With a strong and talented management team in place and dedicated and highly skilled frontline and support teams, we will continue to execute our strategy at speed and to deliver value for all of our stakeholders.”

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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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