PZ Cussons acquires premium spa brand
Holdings for £75m (€101m) in an effort to develop its presence in
the premium personal care market in the UK.
Alongside the announcement PZ Cussons released its financial results for the six months ending 30 November revealing strong sales and profit growth. Sales increased 7 per cent to £299.5m while operating profit rose 10 per cent to £32m helping to fill the company's war chest in advance of the purchase of Sanctuary Spa Holdings. The newly acquired company produces a range of premium beauty and body care products under the Sanctuary brand predominantly for the UK market. Sales of these products represent 70 per cent of the company's revenue while the remainder is made from its Sanctuary spa which attracts 64,000 women a year and helps promote its products and brand. Commenting on the acquisition PZ Cussons CEO Alex Kanellis said: "We see considerable opportunities to create further value from the Sanctuary business, through combining our new product and brand expertise with theirs, developing the brand's international sales, and exploring opportunities to develop the spa concept further." The number of spas is multiplying on both sides of the Atlantic providing cosmetic manufacturers with new vehicles to sell their products and increase brand awareness. In addition to exploiting the opportunities presented by the spa market, PZ Cussons is in the process of reorganizing its supply chain in order to secure strong future financial performance. The company has recently spent £18m on its manufacturing plants in Nigeria modernizing and relocating its facilities for health and beauty in the country. In the UK where it claims to be number one in the personal wash category PZ Cussons is in the process of selling several factories in order to fund the construction of facilities in Manchester costing £26m. The new facilities are being built to meet growing supply needs and are expected to be completed by the end of 2008. They will include a new research and development centre and a fragrance development centre. The UK brand portfolio includes Imperial Leather, Original Source, Carex and the newly acquired Charles Worthington brand. The origins of PZ Cussons stretch back to the Victorian era when George Paterson and George Zochonis set up a trading post in Sierra Leone in 1879.