Lawsuits mar beauty centre's HK listing plan
Perfect Shape, a slimming centre operator that has been the subject of client lawsuits, plans to list in Hong Kong in the near future.
The firm, based in the city and incorporated in the Cayman Islands, operates beauty centres for women in mainland China, Hong Kong and Macau.
In its draft listing prospectus, Perfect Shape said it had faced client complaints and lawsuits. Since 2009, clients have 101 complaints with the Hong Kong Consumer Council and 15 complaints with the Macau Consumer Council, according to the draft prospectus. Client complaints included unsatisfactory treatments, physical injuries from its services, payment disputes, unsatisfactory staff service and contract disputes.
Since 2009, clients have filed 48 lawsuits against Perfect Shape with the city's Small Claims Court. Clients have filed three lawsuits in the District Court, where a former employee had also filed a lawsuit. All the lawsuits were related to 'personal injuries in the course of slimming services and in [the former employee's] employment respectively,' Perfect Shape said.
In May 2008, the Department of Health notified the company that samples of its 'More Slim' products contained forbidden pharmaceutical substances that breached regulations. The department ordered the company to suspend sales and recall products. The total value of such products recalled was HK$1.3 million, Perfect Shape said.
The firm said the number of complaints and lawsuits against it was less than 1 per cent of its member client base.
It has 44 centres in mainland cities, including Shanghai and Guangzhou, plus 12 centres in Hong Kong and one in Macau. 'To capitalise on the robust growth in China's slimming and beauty market, we plan to open 106 service centres in China during the four years ending March 31, 2015,' Perfect Shape said.
For the four months ended July 31, Perfect Shape's net profit doubled to HK$28.9 million, while revenue rose 33.3 per cent to HK$134.5 million.
'We have a large amount of deferred revenue and operating leverage. Prepaid packages are recognised as revenue when treatments are delivered to clients,' it said.
As of July 31, the firm's deferred revenue was HK$147 million, accounting for 48.1 per cent of revenue.
Meanwhile, Beijing Jingneng Clean Energy is making a comeback with a Hong Kong listing that may raise as much as US$300 million before year end, Bloomberg reported, citing two unnamed sources.
The mainland firm withdrew its planned Hong Kong flotation earlier this year. On June 24, Jingneng announced its plans to list in Hong Kong by issuing 2.36 billion H-shares at a maximum price of HK$2.08 per share, which would have raised HK$5.28 billion, more than the reported amount Jingneng now hopes to raise.
The firm is Beijing's biggest operator of gas-fired power plants as of 31 August last year and China's eighth largest wind power operator as of the end of last year, according to its website.
