HEALTHYDAYS GROUP PLC
ADMISSION ANNOUNCEMENT
The Directors of HealthyDays Group plc ("the Company") are pleased to announce
that the Company have commenced trading on the PLUS Markets ("PLUS") today.
The Company has admitted to trading on PLUS its entire issued share capital of
12,248,000 ordinary shares of 1p each.
Introduction
HealthyDays Group plc is the holding company of the group which has built a
profitable business marketing products to assist people with mobility
difficulties to improve their quality of life. The group intends to grow both
organically and by acquisition.
The group approaches its chosen markets using direct selling methods and has
assembled a team of people with relevant expertise in a number of areas to
expand the group.
History and Background
HealthyDays Limited was founded by Amer Deen in 2007 and has grown rapidly
marketing products locally mainly in the region covered by South Yorkshire,
Stockport and Grimsby. The principal activity of HealthyDays Limited is the
direct sale of a range of lifestyle products to the elderly and less able.
HealthyDays Limited acquired PureSleep (UK) Limited in June 2008. PureSleep
(UK) Limited was established in 2005 and operated in the same market selling
the same products as HealthyDays Limited. Significantly PureSleep (UK) Limited
marketed its products throughout the UK and therefore the acquisition of
PureSleep (UK) Limited has given HealthyDays Limited the platform to expand its
business and increase its sales coverage from a localised to a national seller.
The Business
The group sells a range of products which are designed for the elderly and less
able. The business is a direct sales organisation and has grown from its
inception in 2007 to a consolidated turnover of £2.26 million for the 12 months
to 30 June 2009. The sales growth has been generated organically through
HealthyDays Limited and by the acquisition on 30 June 2008 of PureSleep (UK)
Limited.
Currently the group employs approximately fifteen employees, excluding the CEO
and Operations Director, primarily to generate telesales and deliver goods,
split evenly between Wales and Sheffield. Additionally the group currently has
eight self employed salesmen.
The group markets a range of products including adjustable beds, mattresses,
therapy units, mobility scooters, bath lifts and other related products. The
main sales emphasis to date has been on beds, mattresses and therapy units;
however, it is intended that the group will expand this range of products to
include mobility scooters, bath lifts and potentially stairlifts. The group
intends to achieve this expansion by acquiring suitable other businesses in the
industry.
The group has two telesales teams who work from lists of purchased telephone
numbers to make appointments for the self-employed sales agents. The salesmen
visit potential customers in their own homes and are then able to demonstrate
the product and possibly secure a sale.
Once the customer has signed the sales contract and a deposit has been received
the goods are then ordered from the manufacturer. The group undertakes its own
delivery and installation of goods which usually takes place within 14 days of
the order being placed. The final payment for the goods is collected from the
customer on delivery. Salesmen's remuneration is dependent on a sale being made
and the product being installed to the satisfaction of the customer.
In addition in order to provide a more flexible payment method for their
customers, HealthyDays Limited and PureSleep (UK) Limited both have consumer
credit licences so that they can introduce a number of finance companies to
assist customers with the payment for their goods.
Acquisition Strategy
The group intends to adopt an active acquisition strategy in order to increase
the scope and range of products it can offer to its customers including
mobility scooters, stairlifts and other products designed for the elderly and
less able. The Board will consider the most appropriate method of funding these
acquisitions which may be by the issue of new shares in the Company, the
payment of cash or a combination of both.
While the Company has identified certain potential opportunities for
acquisition, any consideration of their possible acquisition is at an early
stage and only preliminary discussions have taken place.
Market and Competition
The UK mobility market is a particularly fragmented market comprising
specialised mobility retailers, a number of companies and manufacturers that
supply NHS patients and care home residents and a number of direct sellers who
deal in products which compete with the products of HealthyDays Limited and
PureSleep (UK) Limited. Such companies include, Niagara Healthcare, part of HCH
Holdings Limited and Craftmatic UK Limited which each have an annual turnover
of between £10 million and £20 million and a larger number of small to medium
sized companies with turnovers of between £1 million and £5 million such as
Willowbrook Limited part of Willowbrook Furniture (Holdings) Limited. High
street retailers such as Dreams plc and IKEA Group owned by Ingka Holding BV
and many department stores also carry specialist ranges of adjustable beds.
The market is not just for the less able. Adjustable beds and memory elastic
mattresses and massage systems have become more common, for example massage
relaxer chairs can be found in shopping centres, cinemas and motorway service
areas.
Current Trading and Prospects
The group's consolidated results are set out in Part III of the Admission
Document. The latest audited financial information for the 6 months period to
30 September 2009 for HealthyDays Limited and PureSleep (UK) Limited were
unqualified. However earlier periods were qualified as follows:
a. the opening balances from the previous periods ended 30 June 2009 were not
subject to an audit and therefore the reporting accountants' were unable to
verify that the opening balances were not materially misstated; and
b. the audit evidence available to the reporting accountants' was limited in
PureSleep (UK) Limited, as the reporting accountants were unable to confirm
the completeness of cash sales. During the year ended 30 June 2009 the
company had inadequate controls over the issue of sales invoices.
The Board has introduced internal controls suitable for the size of the Company
and specifically put in place systems and controls over the issue of sales
invoices to rectify this weakness. The Company has also recently appointed a
group accountant who is responsible for implementing the internal controls and
for computerising the group's accounting records and systems. The Directors
have reviewed the effectiveness of the system of internal financial control as
will be operated by the group. The Directors believe that the internal
financial controls to be implemented will be sufficient for the Company's
requirements but will continue to review this as the group expands.
The Company's next reported results will be the interim results for the period
to 31 December 2009 and are expected to be reported to shareholders in March
2010.
The business is currently trading satisfactorily. The Directors intend to grow
the group organically and by acquisition.
As already mentioned HealthyDays Limited acquired PureSleep (UK) Limited in
June 2008. PureSleep (UK) Limited sold certain of its products with a five year
warranty and a number of other products with a lifetime warranty. This policy
has now been aligned with the warranty provision of HealthyDays Limited which
provides customers with warranties of a similar or shorter period to that of
the suppliers. However, a provision of £240,000 has been made in respect of the
year ended 30 June 2009 in the accounts of PureSleep (UK) Limited against the
cost of valid warranty claims for the cost of repair or replacement of any
product sold by PureSleep (UK) Limited in the year ended 30 June 2009 and prior
periods. The Directors expect that the majority of the provision will be
utilised over a five year period.
Directors
Stephen Barclay (aged 67, Non-executive Chairman)
Stephen qualified as a chartered accountant in 1964 with Robson Rhodes before
obtaining an MBA degree from Wharton Business School in 1967. In 1989, after a
career during which he reorganised various companies, he established Clifton
Financial Associates Plc (now Clink Wharf Associates Limited) to provide
corporate finance advice to small to medium sized private and public companies.
Stephen is a former executive chairman of Seymour Pierce Limited and was a
director of Investment Management Holdings plc until March 2001. In March 2001,
he co-founded CFA Capital Group Plc, whose operating subsidiary, City Financial
Associates Limited, became a nominated adviser and sponsor. He left CFA Capital
Group Plc in December 2004. He is a director of a number of public companies
and is a governor of the London School of Economics and Political Science.
Amer Deen (aged 51, Chief Executive)
Amer is the chief executive and founder of HealthyDays Limited. He is an
entrepreneur who retired from his own successful building services company.
Amer also established Deen & Middleton Associates in September 1997 which
provides management consultancy and investment advisory services to corporate
clients and investment advisory services to high net worth individuals. Amer
was appointed a director and chief executive of AIM quoted Mosaique Plc in
February 2003 and resigned in February 2005 and has been a non-executive
director of a number of companies and was a consultant to several public
companies.
David Wetton (aged 52, Operations Director)
David is the Operations Director of the group. He began his career in 1973 as a
trainee salesman with Wigfalls electrical retailers and moved to become a sales
representative at Cadbury McVite and then a Territory Manager, Catering
Division of Nestlé. He then held various positions in companies which sold
products in the footwear, leisure, outdoor and horticultural markets. After a
period of illness David worked as a consultant in the mobility market initially
specialising in mobility scooters and for Mark Bates Limited, developing a
range of specialised insurance and warranty packages for mobility products. He
has since worked for a number of companies selling and funding mobility
products including Colindale Finance Corp. Limited, Electromotion (Medical
Leasing) Ltd, Status For Mobility Ltd and was a consultant for Care-Knight
Group Ltd.
John Shaw (aged 60, Non-executive Director)
John Shaw qualified as a chartered accountant in 1975 with Touche Ross & Co. in
London. He joined Chase Investment Bank Limited in 1985 and in 1990 he joined
Henry Ansbacher & Co. Limited. He started working with Clifton Financial
Associates Plc in early 1995 becoming a director in December 1996. He was
appointed a director of Seymour Pierce Limited in December 1998 where he was
initially Group Company Secretary and latterly Head of Private Equity. In March
2001, he co-founded CFA Capital Group Plc, whose operating subsidiary, City
Financial Associates Limited became a nominated adviser and sponsor. He left
CFA Capital Group Plc in July 2004 to form Chatsford Corporate Finance Limited.
He is a director of Ricmore Capital Plc and Alltrue Investments Plc which are
AIM quoted.
Directors' current and past directorships held in last five years
Current Previous
directorships/partnerships directorships/partnerships
Stephen Advance Visual Abinger Investments Limited
Barclay Communications Plc
Advance Cornhill Limited
Clink Wharf Associates
Limited Clarcon Limited
Consensus Corporate Consensus Corporate Finance
Finance Group Limited Limited
Harrogate Group Plc Dowgate Capital Advisers
Limited
London School Of Economics
& Political Science Dowgate Capital Plc
LSE Enterprise Ltd Expo 2007 Realisations Limited
(in receivership)
Pointon York Group Limited
Haydons Limited
Raynham Freehold Company
Limited International Centre For The
Study Of Radicalisation And
Raynham Freehold Political Violence
Management Limited
Revelation Piccadilly Holdings
Talisman First Venture PLC
Capital Trust Plc
Merton and Falcon Limited
Templeton College (OCMS)
(Proposal To Strike Off) Merton of London Limited
MICE Group Plc (In
Administration)
Milebeach Limited
Mobile Doctors Group Plc
New Venture Capital Trust
Limited
Ricmore Capital Plc
Talisman House Limited
TVKM Limited (in receivership)
UCTV Digital Limited
Amer Deen HealthyDays Limited Ayesha Deen Limited
Puresleep (UK) Limited Coleprint Limited
Deen & Middleton Diamond Lifestyle Holdings Plc
Associates (in Liquidation)
Martin Shelton Group Plc
Martin Shelton Limited
Mosaique Financial Limited
Pacemaker EV Limited
Powabyke Limited
Powamatique Limited (in
receivership))
David Wetton None Status For Mobility Limited
Status For Mobility (Midlands)
Limited
Status For Mobility (North
East) Limited
John Shaw Advance Visual Advance Cornhill Limited
Communications Plc
Dover Street VCT Limited
Alltrue Investments Plc
Miranda Gold Mining Limited
Chatsford Corporate
Finance Limited Mobile Doctors Group Plc
Harrogate Group Plc Paris Gold Mining Limited
JRS Greycloud Limited Spartan Gold Mining Limited
Ricmore Capital Plc
Substantial Shareholders
Shareholder Number of Percentage
Ordinary of issued
Shares share
capital
Amer Deen1 10,300,000 84.10
1 Included in Amer Deen's shareholding is 1,000,000 Ordinary Shares
belonging to a connected person.
Reasons for Admission
The Directors believe that the Company has reached an appropriate point in its
development to seek Admission, which will assist in raising the public profile
of the Company, help to facilitate fund raising in order to finance future
developments and will enable the Company to use its Ordinary Shares to fund
acquisitions.
Fundraising
The Company conducted a small placing primarily with friends and family of the
Directors raising £30,000 before expenses just prior to Admission in order to
provide additional working capital. The Company issued 120,000 new Ordinary
Shares at 25 pence per Ordinary Share.
Risk Factors
The attention of potential investors is drawn to the fact that ownership of
shares in the Company involves a variety of risks. Investors should be aware of
the risks associated with a smaller company. All potential investors should
carefully consider the entire contents of the Admission Document including, but
not limited to, the factors described below before deciding whether or not to
invest in the Company. The information below does not purport to be an
exhaustive list or summary of the risks affecting the Company and are not set
out in any particular order of priority. There may be additional risks of which
the Directors are not aware. Investors should carefully consider these risks
before making a decision to invest in the Company.
The Directors consider the following risks to be most significant for potential
investors, but the risks set out below and in the Admission Document do not
necessarily comprise all those associated with an investment in the Company.
Dependence upon Executive Directors
The future financial performance of the group will depend heavily on the
continued services of the executive Directors. The group is highly dependent
upon the industry contacts and expertise of the group's executive Directors and
accordingly the loss of the services of any of the executive team could impede
the group's success. Whilst the group has entered into employment arrangements
with each of its executive Directors with the aim of securing their services,
their retention cannot be guaranteed and loss of the service of any of the
executive Directors could have a materially adverse effect upon the group's
future.
If the group cannot hire and retain personnel with the necessary industry
experience, expertise and ability, its future growth may be restricted and the
quality of its services and revenues reduced, with a corresponding adverse
impact on its business and profitability.
Compliance with Legislation
The industry in which the Company operates is subject to a number of industry
and health and safety regulations and guidelines. The consequences of
non-compliance may result in negative effects not only in terms of reputation
and profitability, but may result in the exposure of the group to fines,
enforced periods of inactivity, prosecution or other legal actions.
Warranty Claims
The group sells certain products with a warranty attached. While the Company
ensures that the period of the warranty matches that received from the product
supplier, the sales of certain products by PureSleep (UK) Limited prior to, and
for a limited period following, its acquisition, included a period of warranty
longer than that received from the product supplier. Although the Directors
have made a provision for possible claims, the amount provided may not be
adequate to cover all future claims.
Internal Systems and Controls
The group does not currently have all the internal systems and controls which
investors would expect from a larger, more established business. The Board
intends to take steps to ensure that systems and controls (appropriate for a
company of the size and of the nature of the group) are adopted and reviewed
regularly.
Potential for Negative Press from Media or Consumer Advocacy Groups
The industries in which the group operates periodically receive negative press
from the media and consumer advocacy groups. A sustained campaign of such
negative press could adversely affect the public's perception of these
industries as a whole. This would adversely affect the group's revenue streams.
Regulation, Licensing and Legislative Risks
The business activities of the group are not currently the subject of extensive
regulation. However, there can be no certainty that this will continue to be
the case. A governmental agency may seek to introduce greater regulation of the
activities carried on by the group and this could have a detrimental affect on
the costs associated with the conduct of the group's business.
Client and Commercial Arrangements
The group's ability to penetrate new markets may be impeded if the group's
competitors have already become established in those markets. There is no
assurance that the group will be able to compete successfully with such
existing or potential competitors or that such competitive factors may not have
a material adverse effect on the group's business, financial condition or
results of the business.
Controlling Shareholders
Following Admission, the existing shareholders will together be interested in
approximately 79.54 per cent. of the Issued Share Capital (of which 77.56 per
cent. will be held by the Directors). Therefore, either separately or together,
these Shareholders do now and will continue to exercise significant influence
over the affairs of the group following Admission.
Reputation The group operates in niche markets and as such the maintenance of
its professional reputation and quality of its services is vital to the
continued success of the businesses. There can be no certainty that the group
will be able to maintain its current reputation.
Consumer Credit Act
Following the Court of Appeal case of Wilson v Howard Pawnbrokers there is a
risk that loans are unenforceable if the strict procedures of the Consumer
Credit Act 1974 (as amended) are not carried out by the lender.
DOCUMENT AVAILABLE FOR INSPECTION
Copies of this document will be available free of charge during normal business
hours on any weekday (except Saturdays, Sundays and public holidays) at the
offices of DMH Stallard LLP, 6 New Street Square, New Fetter Lane, London EC4A
3BF from the date of this document for a period of one month from Admission.
CORPORATE ADVISER & CONTACT DETAILS
IAF Capital Limited is acting as the Corporate Advisor for the Company, and can
be contacted at:
One Lyric Square
London
W6 0NB
Email: info@iafcapital.com
Telephone: +44 (0)20 3159 5195
The Directors of HealthyDays Group plc accept responsibility for this
announcement.
For further information please contact:
HEALTHYDAYS GROUP PLC
Amer Deen - Chief executive Officer Tel: 0114 276 0000
IAF CAPITAL LIMITED
Alex Borrelli Tel: 020 3159 5198
Gary Pinkerton Tel: 020 3159 5196
END