Headline: Allou Health & Beauty Care, Inc. to Report Record Revenues for Fiscal
Year 1999: Banner Year Expected for Fiscal 2000
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BRENTWOOD, N.Y., May 6 /PRNewswire/ -- Allou Health & Beauty Care, Inc.
(AMEX:ALU), today announced that it will report record revenues for fiscal
Year 1999, ended March 31 and is well-positioned for a break out year in
FY 2000.
David Shamilzadeh, senior vice president and chief financial officer,
stated, "The infusion of cash as received from the investment group of The
Fragrance Counter, has created an excellent environment for Allou to grow in
its current fiscal year. In addition, our core distribution business is
enjoying much success and we are confident that our manufacturing subsidiary
Allou Personal Care will turn a profit."
He added, "Management expects sales from the distribution of health and
beauty aids will return to double-digit growth during fiscal year 2000 and
beyond. Our optimism is rooted in the growth the Company is experiencing as a
result of an expanded customer base in the retailing industry. This area is
expanding and management anticipates that as Allou increases its presence in
this marketplace, it will contribute to the Company's growth over the
foreseeable future."
The Company commented that over the past three years the distribution of
fragrances has experienced an average annual growth rate of 19 percent and the
Company fully expect that growth in this area will climb to 25 percent,
commencing in the current fiscal year. This improvement reflects strategic
relationships Allou enjoys with certain manufacturers. Additionally, Allou's
growing customer base also enhances the segment of the Company's business that
enjoys the highest profit margins.
Future growth in this area will occur in existing operations and through
selective acquisitions.
Allou's most recent acquisition occurred during FY 1999. Headquartered in
Miami, Fl, Direct Fragrances, Inc. generates sales from catalogs directed at
over 20,000 rural independent retailers.
At the time of the acquisition, Direct Fragrances reported annual revenues
of approximately $7.0 million and was marginally profitable. Management
expects for FY 2000 Direct Fragrances will reach revenues of $10 million with
gross profit margins exceeding 20 percent.
Currently, Allou is exploring additional acquisitions that will have a
positive impact on Allou's performance.
Allou Personal Care ("APC") was formed with the acquisition of Russ Kalvin
in 1995, a marketer of knock-off hair and skin care products. At the time of
the acquisition Russ Kalvin was experiencing intense competition and shrinking
profit margins. Over the past few years management has transformed the
operations of this subsidiary.
The efforts were successful. APC has emerged as a contract and private
label manufacturer for leading companies including but not limited to: Sears,
J.C. Penney and Bath & Body. APC's customized manufacturing facility in
Saugus, Ca. has a plant that is capable of generating $100 million in annual
revenues, gross profit margins in the area of 55-65 percent. This facility
holds tremendous potential for Allou's future growth.
Management has undertaken with great fervor, programs to reduce overhead.
Recognizing that profit margins in both pharmaceuticals and non-perishable
food businesses were shrinking, management implemented creative techniques,
which, while reducing revenue, have had a positive impact on net margins.
Management continues to closely monitor these segments in an effort to
even further enhance their impact on the Company's bottom line.
"Historically, Allou has been a value driven Company and committed to
increasing shareholder value through prudent decisions that will increase
revenues and profit margins. Increased product demand has been realized in
part, during the recently completed fiscal year, but the real story is in
Allou's future. Management is focused on business growth, equity growth and
regaining shareholder value," Mr. Shamilzadeh added.
Allou's strong financial position (book value $10.90) is the foundation
for future advances. The Company's financial infrastructure has never been
more solid.
Allou will continue to explore areas of business that hold great
opportunities, including but not limited to: consumer and business-to-business
E-commerce.
Management looks forward to keeping its shareholders and the financial
community informed throughout the year.
Allou Health & Beauty Care, Inc. is the premier distributor of over 22,000
nationally advertised health and beauty aid products, branded and generic
prescription pharmaceuticals, prestige designer fragrances, cosmetics and
branded non-perishable foods. Through its wholly-owned subsidiary Allou
Personal Care Corporation, the Company manufactures upscale hair care and skin
care products. The Company also retails prestigious designer fragrances
electronically through its wholly-owned subsidiary The Fragrance Counter.
Allou's account base consists of 4,200 independent drug and convenience stores
and the leading national chain stores.
fragrancecounter.com
cosmeticcounter.com
As always, management welcomes and values your inquiries.
This release may include forward-looking statements concerning Allou's
intent, belief or current expectations with respect to, among other things,
trends affecting its financial condition or results of operations and its
business and growth strategies. Such forward-looking statement are not
guarantees of future performance and involve risks and uncertainties that may
cause actual results to differ materially from those projected, expressed or
implied. Allou does not undertake any obligations to update or revise any
forward-looking statements.
SOURCE Allou Health & Beauty Care, Inc.
-0- 05/06/99
/CONTACT: David Shamilzadeh, Senior Vice President, Chief Financial
Officer of Allou Health & Beauty Care, Inc., 516-787-1312/
/Web site: fragrancecounter.com
/Web site: cosmeticcounter.com |
