SYDNEY, June 9, 2011 /PRNewswire/
-- Australia's leading natural
products distributor, franchise retailer and producer of health,
beauty and natural products, Healthzone Limited (ASX: HZL.
OTCQX: HLTZY), today announced the acquisition of the
privately-held Australian natural and organic skincare company
Forte Brands. The company also announced the
development of new brand products and retail growth of company
stores and Healthy Life China.
Healthzone acquires natural health and beauty brands
Healthzone Ltd has reached agreement, subject to standard
contractual terms being finalised, to acquire the majority
shareholding of the privately-held Australian natural and organic
skincare company Forte Brands. The Company confirms that the
acquisition is EPS accretive consistent with Healthzone's
acquisition principles and is scheduled to complete prior to the
30 June 2011. The consideration
remains commercially sensitive, with premature disclosure possibly
prejudicing other negotiations in which the Company is presently
engaged. The acquisition will be funded from cash reserves and
proposed newly issued script.
Forte Brands develops and markets natural and organic skincare
under the brand names of Trelivings and Evodia. These brands are
established and have been well recognized for more than 25 years
and are currently sold through major department stores David Jones and Myer as well as pharmacies,
health and gift stores throughout Australia, New
Zealand and Asia.
This acquisition incorporates the transfer of Forte's product
portfolio and experienced natural skincare team to Healthzone's
Sydney Head Office. The vendor, who
will retain a minority percentage of the business, will be joining
Healthzone to continue the development and growth of the Trelivings
and Evodia brands in a natural and organic skincare market that is
currently growing up to 17% annually internationally.
"The acquisition of Forte Brands provides Healthzone with an
increasing platform of well recognised quality natural skincare
products and qualified, experienced people. This is a robust
addition to our distribution business from which to develop further
our existing high margin natural skincare brands of BOD and Natural
Alternative into many new markets." said Mr Roach. "The newly
acquired brands are extremely scalable in our current retail and
distribution networks and rapidly expanding international markets,
and are complementary to our current stable of skincare
brands."
Brands Development
In support of the strategy to convert low margin distributed
products to high margin own brand products Healthzone is currently
expanding the Healthy Life and Natural Alternative nutritional
supplement ranges. The company announced that there are 42 new
Healthy Life nutritional supplements and more than 50 new Natural
Alternative nutritional supplements being launched in the first
half of FY2012 in local and expanding Asian markets.
An advanced 'East meets West' nutritional supplement range of
more than 50 products, that combine ancient and modern traditional
Chinese medicines with popular Western herbs and vitamins, forms
the basis of a range of branded products that will soon be
available through Healthzone in markets both in Australia and Asia, empowered by Eu Yan Sang scientific
research and high quality potent herbal content.
In addition, a new sports nutrition powder range of 12 products
has been completed and will further support Healthzone's margin
growth strategy as well as provide for a new and exclusive health
food only sports nutrition brand for the health channel in
Australia.
During the transition from higher revenue low margin products to
high margin own brand products there will be a short-term reduction
in top line revenues. The reduction will normalise into FY2012 with
increasing forecast revenues and higher margins from the existing
ranges and new own brand proprietary products currently being
acquired, developed and launched in Australia and expanding Asian markets,
supported by Healthy Life and alliance partner stores.
Retail Growth
Healthzone now operates 30 company owned stores with the recent
addition of Healthy Life Burwood, Helensvale and Hurstville to the
Australian network. With the successful vertical integration of
retail, wholesale and own brand product margins Healthzone intends
to increase the Australian company owned store operation by up to a
further 30 sites during FY2012 through new store openings and
acquisition of independent and competitor branded stores for
conversion to Healthy Life. These initiatives are in support of the
previously announced 200 Healthy Life store target by the end of
2012 and will further enhance the Companies increased higher margin
revenue growth strategy.
Healthy Life China continues to be a major focus as a vehicle
for own brand product growth and development in the Asia market. A recent restructure of the
China retail business model is
supported by the relocation of Executive Director Mr Michael Wu from Sydney to China to drive the accelerated expansion
strategy through organic growth and acquisition of existing retail.
An existing network of 47 retail stores in East China is currently
under diligence review for acquisition and conversion to Healthy
Life in support of the target for 100 Healthy Life China stores by
December 2012.
About Healthzone Limited
Healthzone Ltd operates a portfolio of distribution, consumer
product and retail business and is the largest operator in the
Australian Wellness sector with significant and growing Asian and
China wellness market interests.
Each business provides immediate opportunities for earnings growth
through business development and integration. Healthzone's
businesses are comprised of three principal activities: Health and
Beauty distribution; Health and Beauty Products; and Health Food
Retail. For further information please visit
www.healthzone.com.au.
CONTACT:
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Healthzone
Limited
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USA
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Australia
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Peter Roach
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The Trout Group
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FCR
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Executive Chairman
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Investor Relations
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Financial & Corporate
Relations
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Tel: +612 9772 7100
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Brian Korb
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Ashley Rambukwella
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Tel: +1 646 378 2923
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Tel: +61 2 9235 1666
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SOURCE Healthzone Limited