We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Register to chat with like-minded investors on our interactive forums.
| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Faces Cosmetics | LSE:FCE | London | Ordinary Share | GB00B1CKTQ32 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.175 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
Hot Features
Premium
FOR RELEASE
25 January 2008
FACES COSMETICS PLC
("Faces Cosmetics" or "the Company" or "the Group")
("branded cosmetics, skin care and anti-aging products")
RESULTS FOR YEAR ENDED 31 JULY 2007
Highlights 2007 2006 Change
C$`000 C$`000
System Revenue 13,003 12,184 +6.7%
Revenue 4,433 4,006 +10.6%
Loss before tax (2,303) (605) (280.5)%
Basic loss per share (0.05) (0.01) (400)%
Introduction
This annual report is the first set of results since the Company was admitted
to trading on AIM on 7 September 2006. In this relatively short period the
Company has laid the foundations and arranged new funding for its overseas
expansion.
* The Group incurred a net loss of $2,313,580 of which a large portion
related to adjustments to the treatment of costs of restructuring and the
raising of pre IPO funds, the reclassification of items previously
capitalised and the valuation of trading stock, some of which are of a
non-recurring and exceptional in nature.
* An investment by Indivision Ventures II of £5 million by way of a
subscription for 125,000,000 new ordinary shares in the Company at a price
of 4p per share, representing approximately 70.6 per cent of the Company's
enlarged issued share capital, was arranged during the year and completed
after the year end.
* The new funding will provide not only the opportunity to accelerate the
development of new markets in India and the Middle East but also to build
upon Faces' existing operations though the continued rollout of its
franchise model. The company may also establish, a limited number of
Group-owned flagship stores to demonstrate the operation of the franchise
model and provide training centres for franchisees.
For further information, please contact:
Faces Cosmetics plc
Ramesh Jolly + 1 (905) 760 0110 Ext.112
Chief Executive Officer
Rupert Folkard + 1 (905) 760 0110 Ext 102
Finance Director
www.faces-cosmetics.com
City Financial Associates Limited
Ross Andrews + 44 (0) 20 7492 4777
Faces Cosmetics plc
("Faces Cosmetics" or "the Company" or "the Group")
("branded cosmetics, skin care and anti-aging products")
RESULTS FOR YEARENDED 31 JULY 2007
CHAIRMAN'S AND CHIEF EXECUTIVE'S STATEMENT
Introduction
These are the first set of annual results since the Company was admitted to
trading on AIM on 7 September 2006. In this relatively short period the Company
has laid the foundations for its expansion in established and international
markets.
Financial Overview
Revenue for the period was C$4,433,115 (2006: C$4,006,613) and the loss before
tax was C$2,302,380 (2006: C$605,015). These results are outlined in more
detail in the Finance Director's Report. The directors have not declared any
dividend in respect of the period ended 31 July 2007.
Business Overview
The directors consider the key performance indicators of the Group to be:
The key non financial performance indicators are:
- Revenue increased 10.6% to C$4,433,115 (2006: C$4,006,613)
- Gross Profit decreased 2.6% to C$ 2,428,176 (2006: C$2,492,176)
- Losses after Tax increased 280% to C$2,313,580 (2006: C$608,529)
Operational Overview
Since admission to AIM in September 2006, the Company has concentrated on
laying the foundations for expansion in international markets along with its
ongoing development in the United States as the principal source of growth.
Starting spring 2008 the Company expects to put in place its strategy for
expansion into the Middle East and India.
At the time of the Company's admission to AIM, the Directors' stated strategy
was to build upon Faces' existing network of mainly franchised retail locations
predominantly located in Canada and Mexico, and to expand the awareness of the
Faces' branded cosmetics and skincare business internationally.
In line with the Faces strategy to expand its branded cosmetics and skincare
business through its franchise model, the Group has completed the sale of three
Group-owned retail locations in Montreal, Canada to an existing franchisee. In
addition, it has opened new franchise locations in British Columbia and
Toronto, Ontario. The Group is also expanding into Alberta in the Southwest of
Canada for the first time.
International Markets
The Group has opened an additional store in Ireland, and a master franchise
agreement covering the United Arab Emirates, Saudi Arabia, Kuwait, Oman, Qatar,
Bahrain and Yemen. An agreement has also been entered into for the future
opening of stores into new markets in Kosovo and Central America.
In the United States, since September 2006, the Company has laid the
foundations for expansion and recently announced agreements for 18 new
franchised store locations, grouped into four geographical multi-franchise
territories focused on California, Northern Virginia, Maryland and Texas. The
area developer franchisees expect to open their first store in each of the two
regions early in 2008 and plan to open the balance progressively over the next
two years.
In view of the strategic importance of the United States market, the Group
appointed Mr. Kim Perrotta as Vice President of Franchise and Business
Development with over 30 years experience in this area.
In Mexico, the Faces licensee has added two new locations to its existing store
portfolio and commenced an initiative to establish Faces branded departments
within host stores. The initiative includes the launch of 3 pilot Faces
concessions in Sanborns department stores.
In Central America, the first franchise agreement has been signed in San Pedro
Sula, Honduras. San Pedro Sula is the second largest city in the country and
considered the economic heartland and Industrial Capital of Honduras. The
Directors expect that the new store will be the first of a number of franchised
stores under a business expansion programme with a number of opportunities for
further expansion throughout Central America and the surrounding regions.
In Ireland, the Master Franchisee opened its second store in Navan.
New Product Development
In addition to the continuous development of new products within the Group's
core product portfolio, Faces has accelerated the development of high
performing spa products with over 30 new introductions during the year. In line
with the trends in the cosmetic market, the Group has expanded its existing
range of men's skin care products with the launch of `Deep Cleansing Foam',
`Advanced Defense Age Defying Serum' and `Energizing Eye Gel'.
The Group intends to expand its mineral powder line with SPF 25 and water
resistance, glitter eyeliner, an intensive therapeutic foot cream, and a
perfecting skin foundation line. A complete line of body care products and a
mineral makeup line are to be introduced in Spring 2008.
Funding by Indivision
On 18 October 2007, an agreement with Indivision Ventures II was entered into
whereby Indivision agreed to invest £5 million in the Company by way of a
subscription for 125,000,000 new ordinary shares at a price of 4p per share,
representing approximately 70.6 per cent of the Company's enlarged issued share
capital.
Indivision Ventures II, wholly-owned by Indivision India Partners, was
established for the purpose of the Subscription. Indivision Indian Partners is
a US$425 million private equity fund with an investment focus on businesses in
the consumer brands sectors which caters to consumers from Indian subcontinent.
Indivision India Partners' has a relationship with Pantaloon Retail (India)
Limited, one of India's largest retailers with a quotation on the Mumbai Stock
Exchange.
Indivision India Partners' investment philosophy is (i) to partner with and
invest in businesses seeking growth capital, and who share similar growth
aspirations and (ii) to invest in businesses where there are opportunities to
exploit synergies with Pantaloon.
Outlook
The availability of new funding, received in November 2007, will provide the
Directors not only with an opportunity to build upon Faces' existing operations
though the continued rollout of its franchise model but also to establish, over
the next 12 to 18 months, a limited number of Group-owned flagship stores which
can also be used as training centres for franchisees.
In Asia, the opportunity to develop a Faces network in India with Indivision is
an exciting prospect for the Company. The Directors believe that the Indian
market, with a middle class population of 250 million people and where women
(aged between 15 years and 39 years) make up 20 per cent of the population,
with an established demand for cosmetic, skin care and anti-aging products
provides outstanding growth potential.
The Group's plans will include establishing a relationship with a well
established Indian retailer, opening Group-owned stores, followed by a rollout
of franchised stores throughout India. In the Director's opinion, the Group
offers a broader range of products compared to that which is currently
available by a single brand in the Indian market.
With the fourth largest and second fastest growing major economy in the world,
India is a key market for Faces cosmetics future expansions plans and the Group
hopes to announce further details on its strategy for the Indian Market within
the next three months.
In the USA, the Group will focus on four key strategic markets: Eastern
Seaboard (New York/New Jersey), the West Coast (Los Angeles/San Francisco), the
Mid West (Chicago) and the Florida coast.
The Group has developed plans in the next phase for the UK market. It is
intended to position a flagship store prior to building a network of satellite
locations under franchise agreements. The Directors do not expect to establish
corporate owned stores in other UK geographic areas until the first
company-owned store is established and a master franchisee is identified.
This approach is intended to improve training and personnel development,
provide effective regional management and supervision, promote a cost effective
regional communications program, build trade and customer recognition and
attract new franchisees. The first step is to invest in infrastructure and
expand the existing retail network. The Directors believe that the
establishment of a company-owned store is, in many cases, the most effective
vehicle to attract new franchisees and bring the Faces' brand, products and
services to the public arena.
The Directors intend to appoint a marketing director, supported by a small
in-house team and third party specialist advertising and public relations
agencies to introduce a marketing-led approach, manage budgets and ensure that
a consistent brand image is projected through all communication media. In the
short term, the Company will concentrate on a calendar of promotions, which
will not only cover the traditional promotional events for Christmas,
Valentine's Day, Mother's Day, Father's Day etc, but also product based
promotions.
Additionally, the Directors intend to establish a central marketing department
that will progressively build a comprehensive range of marketing support
materials including advertising and public relations in support of local and,
ultimately, national promotional events. This approach is intended not only to
provide professional marketing tools to the franchisees for their own use, but
also build awareness and desirability of the Faces brand through consistent,
controlled and coordinated communications messages at the local and national
levels.
Terrence Horner Ramesh Jolly
Chairman Chief Executive Officer
FINANCE DIRECTOR REPORT
Operating Performance
Group sales were C$4,433,115, and represent an increase of 10.6% over the prior
year period of the predecessor Canadian entity. The Group incurred a net loss
of C$2,313,580 of which a large portion related to adjustments to the treatment
of costs of restructuring and the raising of pre IPO funds, the
reclassification of items previously capitalised and the valuation of trading
stock, some of which are of a non-recurring and exceptional in nature.
Capital Movements
Prior to the introduction of the Group to trading on AIM, Faces secured funding
of US$2.13 million from Pride, a third party investor, by way of equity
subscription for common shares in Faces Holdings Inc., subsequently exchanged
for 20,682,210 Ordinary Shares. The proceeds of the funding were used to meet
the costs of Admission (£500,000) and to provide additional working capital for
the Group. Following the pre-Admission subscription, this investor held
18,137,210 Ordinary Shares representing 35.63 per cent. of the issued Ordinary
Share capital of the Company upon Admission.
On 24 August 2006 the Company acquired 100 per cent of the issued share capital
of Faces Holdings Inc. in consideration of the issue, credited as fully paid,
of 50.9 million Ordinary Shares and 30.173 million Preference Shares to the
holders of common shares and preference shares in Faces Holdings Inc.
Faces Holdings Inc. had been partly funded, since 2001, by C$4.17 million of
loans provided by a consortium of Canadian based investors. As part of the
Admission process the providers of these loans agreed to convert the
outstanding loans into 30,172,631 Preference Shares.
The non-listed Preference Shares are convertible into Ordinary Shares on a one
for one basis, in tranches on a quarterly basis commencing six months after
Admission. On full conversion the issued ordinary share capital of the Company
would increase by 30,172,631 Ordinary Shares representing 37.22 per cent of the
enlarged share capital of the Company. To date none of the preference shares
have been converted.
Post Balance Sheet Events
In November 2007 Indivision Ventures II invested £5 million in the Company by
way of a subscription for 125,000,000 new ordinary shares at a price of 4p per
share, representing approximately 70.6 per cent of the Company's enlarged
issued share capital.
Taxation
No taxation arises in respect of the Group's trading for the year. The Group
has tax losses carried forward of over $4,230,000.
Investments
The Company has no investments other than in its operating subsidiary.
Rupert Folkard
Finance Director
FACES COSMETICS PLC
GROUP INCOME STATEMENT
FOR THE PERIOD ENDED 31 JULY 2007
Pro forma
2007 2006
Notes C$'000 C$'000
Continuing operations
Revenue 2 4,433 4,006
Cost of sales (2,005) 1,514
Gross profit 2,428 2,492
Operating expenses (247) (160)
Share warrant expenses (306) -
Share option expenses (93) -
Share issue costs (463) -
Administrative expenses (3,623) (2,938)
Loss from operations (2,304) (605)
Other Income 1 -
Loss before Taxation (2,303) (605)
Taxation 3 (11) (4)
Loss after taxation (2,314) (609)
Loss per share (cents): 7
Basic (0.05) (0.01)
Diluted (0.05) (0.01)
FACES COSMETICS PLC
GROUP STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
FOR THE PERIOD ENDED 31 JULY 2007
Ordinary Share Preference Share Share premium Share Warrant
capital Capital Reserve
C$'000 C$'000 C$'000 C$'000
Balance at 1 - - - -
August 2006
Profit for the - - - -
year
- - - -
Merger - - - -
Issue of shares 1,092 646 474
Issue of share - - - 272
warrants
Issue of share - - - -
options
Balance at 31 1,092 646 474 272
July 2007
Share Option Retained Merger Reserve Total
Reserve earnings
C$'000 C$'000 C$'000 C$'000
Balance at 1 - (2,970) 1,250 (1,720)
August 2006
Profit for the - (2,314) - (2,314)
year
- (5,284) 1,250 (4,034)
Merger - - 2,998 2,998
Issue of shares - - - 2,212
Issue of share - - - 272
warrants
Issue of share 93 - - 93
options
Balance at 31 93 (5,284) 4,248 1,541
July 2007
FACES COSMETICS PLC
GROUP BALANCE SHEET
AS AT 31 JULY 2007
Pro forma
Notes 2007 2006
C$'000 C$'000
Assets
Non-current assets
Notes and loans receivable 494 13
Property, plant and equipment 276 397
Intangible assets 842 961
1,612 1,371
Inventories 2,428 2,769
Accounts Receivable 625 429
Deposits and prepaid expenses 124 35
Notes and loans receivable 65 305
3,242 3,538
Total assets 4,854 4,909
Equity and liabilities
Current liabilities
Trade and other payables 903 638
Bank loans and overdraft 4 837 184
Loans from related parties 5 1,052 299
Current portion - long term debt 243 654
Tax payable - 4
3,035 1,779
Non-current liabilities
Other loans - 4,364
Long term debt 278 486
Total liabilities 3,313 6,629
Capital and reserves
Share capital - common shares 6 1,092 -
Share capital - preference shares 646 -
Share premium 474 -
Share warrant reserve 272 -
Share options reserve 93 -
Merger Reserve 4,248 1,250
Retained losses (5,284) (2,970)
Total equity attributable to equity 1,541 (1,720)
holders
Total equity and liabilities 4,854 4,909
FACES COSMETICS PLC
GROUP CASH FLOW STATEMENT
FOR THE PERIOD ENDED 31 JULY 2007
Pro forma
2007 2006
C$'000 C$'000
Cash flows from operating activities
Cash receipts from customers and franchises 3,650 4,052
Cash paid to suppliers and employees (5,075) (4,057)
Interest paid (148) (172)
Net cash from operating activities (1,573) (177)
Cash flows from investing activities
Product development and intangible asset costs (102) (441)
incurred
Purchase of property, plant and equipment (22) (12)
Proceeds from disposal of property, plant and 99 -
equipment
Net cash used in investing activities (25) (453)
Cash flows from financing activities
Common shares issued for cash 2,496 250
Payment of cost of shares issued (1,796) -
Proceeds from promissory note - 452
Repayment of bank loans (194) (181)
Repayment of advances 116 (284)
Repayments of small business loan (8) (62)
Proceeds of other loans 586 45
Proceeds of loans from related parties 782 298
Repayment of promissory note payable (452) -
Net cash from financing activities 1,530 518
Net increase in cash and cash equivalents (68) (112)
Cash and cash equivalents at the beginning of (183) (72)
the year
Cash and cash equivalents at the end of the (251) (184)
year
1. Notes to the Preliminary Results
The financial information set out in the preliminary announcement does not
constitute the Group's statutory accounts within the meaning of section 240 of
the Companies Act 1985 and has been extracted from the Group's statutory
accounts for the year ended 31 July 2007, which were approved by the Board on
24 January 2008. The auditors have reported, on those accounts; their report
was unqualified and did not contain a statement under section 237(2) or (3) of
the Companies Act 1985.
The accounts have been prepared in accordance with International Financial
Reporting Standards adopted by the European Union and the accounting policies
adopted in the Company's AIM Admission Document dated September 2006, as well
as applying the principles of uniting of interests (merger accounting) to the
acquisition by the Company of Faces Holdings Inc. The accounts will be
delivered to the Registrar of Companies after the Company's Annual General
Meeting, which is scheduled for 18 February 2008.
The financial information set out in this announcement was approved by the
Board of Directors.
2. Segmental reporting
The directors consider that the Group's activities represent a single class of
business. The analysis of the Group's turnover, profit before tax and net
assets by geographical origin is set out below:
Pro forma
2007 2006
C$'000 C$'000
Turnover
North America 3,599 3,552
South America 354 400
Europe 57 54
Middle East 423 -
4,433 4,006
Operating profit
North America 1,799 2,265
South America 177 200
Europe 29 27
Middle East 423 -
2,428 2,492
Net Liabilities
Unallocated net liabilities (3,546) (1,720)
3. Taxation on profit from ordinary activities
Pro forma
2007 2006
C$'000 C$'000
Domestic current year tax
Overseas tax payable 11 4
Current tax charge 11 4
Factors affecting tax charge for the year:
Loss on ordinary activities before tax (2,302) (605)
Loss on ordinary activities before taxation (691) (182)
multiplied by standard rate of UK
corporation tax of 30% (2006: 30%)
Losses carried forward 702 186
Current tax charge 11 4
The Group has tax losses arising that are available against future taxable
profits. Deferred tax available have not been recognized as a result of the
existing uncertainties of their realisation.
4. Creditors
Pro forma
2007 2006
C$'000 C$'000
Amounts falling due within one year
Trade and other payables 904 638
Bank and other borrowings 837 184
1,741 822
Amounts falling due after one year
Bank and other borrowings 278 486
The normal trade credit terms granted by suppliers range from 30 to 90 days.
5. Bank Borrowing
Pro forma
Group Group
2007 2006
C$'000 C$'000
Bank overdraft 251 184
Bank loans 586 -
837 184
6. Share capital
a) Authorised
GBP
Authorised:
100,000,000 Ordinary shares of GBP0.01 each 10,000,000
30,172,631 Preference shares of GBP0.01 each 301,726
Issued:
51,046,570 Ordinary shares of GBP0.01 each 510,466
30,172,631 Convertible preference shares of GBP0.01 each 301,726
812,192
The company was incorporated with an authorised share capital as set out above.
b) Share issues during the period
Note Issue value Shares Share Share
per share Capital premium
GBP
Initial acquisition (i) 0.02 50,900,000 509,000 509,000
Share issue (ii) 0.12 100,000 1000 11,000
Share issue (iii) 0.1215 40,000 400 4,460
Share issue (iv) 0.0873 6,570 66 507
51,046,570 510,466 524,967
On 24 August 2006, shareholders of Faces Holdings Inc. entered into an
agreement under which the entire issued share capital of Faces Holding Inc was
acquired by Faces Cosmetics PLC in consideration for the issue of 50,900,000
ordinary shares and 30,172,631 preference shares in Faces Cosmetics PLC.
On 18 September 2006, 100,000 ordinary shares of GBP0.01 were issued for cash
of GBP0.12 per share, representing a premium of GBP0.11 per share.
On 22 December 2006, 40,000 Ordinary shares were issued for cash of GBP0.1215
per share, representing a premium of GBP0.1115 per share.
On 20 February 2007, 6,570 shares were issued for cash of GBP0.0873 per share,
representing a premium of GBP0.0773 per share.
7. Loss per share
In accordance with IAS 33 and as the group has reported a loss for the period
the shares are not dilutive
Proforma
Group Group
2007 2006
C$'000 C$'000
Profit/(loss) after taxation (2,313) (609)
Number Number
Basic and diluted weighted average ordinary 50,139,477 50,139,477
shares in issue during the period
Basic and diluted earnings per share based (0.05) (0.01)
on the issued share capital as at 31 July
2007
8. Post balance sheet events
On 13 November 2007, the Company concluded an agreement with Indivision
Ventures II whereby they agreed to invest £5 million in the Company by way of a
subscription for 125,000,000 new ordinary shares in the Company at a price of
4p per share, representing approximately 70.6 per cent of the Company's
enlarged issued share capital.
9. Report and Account Information
Copies of the full report and accounts for the year ended 31 July 2007 are
being sent to shareholders. Further copies are available on the company's
website. www.faces-cosmetics.com
END
1 Year Faces Cosmetics Chart |
1 Month Faces Cosmetics Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions
