Supercuts 2003 Annual Report Download - page 11

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Table of Contents
International Salons:
At June 30, 2003, the Company operated 2,026 hair care salons, including 1,627 franchised salons, located throughout Europe, primarily in the
United Kingdom, France, Italy and Spain. During fiscal 2002, the Company added to its existing international salon concepts — primarily
Regis Hairstylists, Trade Secret, Hair Express and Supercuts — with the acquisitions of the French franchisors GGG and JLD. Salons
associated with GGG operate under the brands Saint Algue, Coiff & Co., Intermede and City Looks. JLD operates primarily under the
following concepts: JLD Diffusion, JLD Tradition and JLD Quick Service. During fiscal 2003, the Company acquired 25 Vidal Sassoon salons,
14 of which are located in Europe. Company-owned salons in the international division operate in malls, leading department stores, high-street
locations and grocery and retail chains under license arrangements or real property leases, consistently focused on the value-priced, moderate
and upscale hair care and beauty market. The average sale at an international salon is approximately $44. Revenues from company-owned
salons and franchise royalties from international franchised salons grew to $135.2 and $36.3 million, respectively, or 10.2 percent of the
Company’s total revenues, in fiscal 2003.
8
Other Company-owned Strip Center Salon Concepts . Company-owned Strip Center Salons are made up of successful salon groups
acquired over the past five years operating under the primary brands of Hair Masters, Style America, First Choice Haircutters, Best Cuts,
Cost Cutters, BoRics and Magicuts, as well as other regional brand names. All concepts offer a full range of custom hairstyling, cutting,
coloring and permanent wave as well as hair care products. Hair Masters offers moderately-priced services to a predominately female
demographic, while the other brands primarily cater to time-pressed, value-orientated families. The average sale for a company-owned
strip center salon is approximately $13. At June 30, 2003, the Company operated 1,141 salons within these concepts. Revenues from this
group of salons during fiscal 2003 were $230.1 million, or 13.7 percent of the Company
’
s total revenues.
Other Franchise Concepts. This group of franchised salons includes primarily First Choice Haircutters, Magicuts, Pro-Cuts and
Haircrafters. These concepts function primarily in the high volume, value-priced hair care market segment, with key selling features of
value, convenience, quality and friendliness, as well as a complete line of professional hair care products. At June 30, 2003, there were 427
franchised salons in this group, generating franchise revenue during fiscal 2003 of $5.2 million, or 0.3 percent of the Company’s total
revenues. In addition to these franchised salons, the Company operates company-owned First Choice Haircutters and Magicuts salons, as
previously discussed above.