Thursday, August 6, 2009

IPO: Mary Chia

Company Info:

We are one of the leading lifestyle and wellness service providers in Singapore. Our principal business activity is the provision of lifestyle and wellness services for both women and men at our lifestyle and wellness centres under our “Mary Chia” (for women) and “Urban Homme” (for men) brands. Our services can be broadly categorised into:
(i) beauty and facial services;
(ii) slimming services; and
(iii) spa and massage services.
Our ancillary business is the sale of lifestyle and wellness products under our “MU” brand at our lifestyle and wellness centres.

IPO Detail:

Net proceed: S$3.9m
$1.0m expansion
$1.0m acquisition, joint ventures, strategic alliances
$1.9m balance

No fixed dividend policy

Competitive Strength:

  • Extensive Network:

    * 15 lifestyle and wellness centres in Singapore
    * 3 lifestyle and wellness centres in Malaysia

  • Expansion Plan:

    * Expand 2 more lifestyle and wellness centres in Singapore by 2009
    * Expand 1 with safari theme in Safra Jurong Club by 2009
    * Expand the untapped men with "Urban Homme" (no details)
    * Expand oversea in Malaysia, venture PRC and Dubai
    * Expand "Mentsu" brand for young PMEBs


  • Maintain or improve Branding
  • Rely on rental which takes up 17.2% of total revvenue FY2008, (Lease normally <= 3 years)
  • Compete against competition
  • Handle customer complaints, although insured partially. Paid S$1,169 in FY2008, S$17,902 in FY2009
  • No long-term contract with suppliers
  • Rely on prepayment of customer for cash-flow
  • Need to obtain licenses, 11 out of 14 require Massage Establishment (wasn't it 15 centres?)


  • Bella Facial Care Center (S) Pte
  • Bioskin Pte Ltd
  • Jean Yip Saloon Pte Ltd
  • London Weight Management Pte Ltd
  • Marie France Bodyline (S) Pte Ltd
  • New York Skin Solutions Pte Ltd
  • OSIM (substitute DIY healthcare)
  • Unlicensed, illegal centres (using illegal, cheaper labor)

Investment tips:

Why not?
  • Amounts due from directors around $8m in FY2008 although repaid. But why and does directors borrow from company often?
  • Urban Homme was not profitable in FY2008 despite increasing revenue, why?
  • Negative working capital
  • S$1.4m of negative cash flow used in investing compared to just $0.2m of cash flow from operations
  • Decreasing advertisement and marketing expenses, $1m in FY2008 despite the importance of branding?
  • Rental contract are relatively short-terms and can led to higher rental in future. Some lessor takes cut of overall turnover in additional to rental.
  • Increasing inventory turnover days, 138 days in FY2008 although it mention it is due to bulk purchases. Credit turnover is only 69 days, so it got to hold goods for additional 60+ days. If customers prepay, it should not be so high since it knows before hand what to get?
  • Waiving of S$0.5m to MCU?
  • Fine for late filling in FY2008


  1. IPO Prospectus

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