Malaga-based window treatments company Kresta Holdings Ltd will expand its subsidiary, Curtain Wonderland, into Western Australia with a planned 10-store nationwide rollout over the next year, the company has announced.
Malaga-based window treatments company Kresta Holdings Ltd will expand its subsidiary, Curtain Wonderland, into Western Australia with a planned 10-store nationwide rollout over the next year, the company has announced.
Curtain Wonderland, which unlike most Kresta stores operates primarily as an over-the-counter seller, already has 15 stores in Queensland and five in New South Wales.
Kresta managing director Tass Zorbas told WA Business News the company had performed beyond expectations after it was acquired last year.
"The two big states for us at the moment are WA and Queensland," he said.
"We're looking to bring at least four into WA. It doesn't pay to do under three, because people don't want to travel too far to shop."
Kresta was also looking to increase its market presence in the eastern states, and expand into the Melbourne and Adelaide markets.
The expansion, to be fully funded from within the company, is part of the company's goal of creating another ten stores every year.
Kresta Holdings Ltd announced a half year net profit of $2.4 million in February, a 53 per cent increase on the previous corresponding period.
The full text of a company announcement is pasted below
Leading national window coverings company Kresta Holdings Limited ("Kresta" or "the company") plans to fast track its national retail offering through both an expansion of the Curtain Wonderland business that was acquired in July 2006, and further acquisitions.
Curtain Wonderland is predominately operating in Queensland and New South Wales, with the acquisition adding 19 stores to the Kresta Group network, which already had 56 stores operating in Australia and New Zealand.
Since the acquisition, Kresta has successfully integrated Curtain Wonderland into its window covering business, creating significant economies of scale and increasing the profitability of the Kresta Group.
In the six months to December 2006 Curtain Wonderland recorded an earnings before interest, tax, depreciation & amortization (EBITDA) of $1.6m, which was approximately $1m more than that forecasted by the company.
"The Kresta Group has a major position in the window coverings market, but what the Curtain Wonderland acquisition gives us is a strong over-the-counter business and importantly a significant 'footprint' into the Queensland market," said Kresta Managing Director Tass Zorbas.
"Traditionally our sales were driven by in-home purchases, so the acquisition of Curtain Wonderland has created economies of scale and complementary opportunities to our existing business."
"Importantly it gives the company a greater presence in the Queensland markets, which together with Western Australia are the two growth states for the group."
"Our plan is to capitalise on the success of this acquisition, further acquisitions and the strength of existing brands so as to drive further growth of the Kresta Group."
Kresta plans to add ten Curtain Wonderland stores to its network in the coming 12 months, with at least four of these being in Western Australia.
The company has already identified a number of sites and expects to finalise negotiations regarding these in the coming months.
Kresta will continue to evaluate further acquisitions, which are similar to that of Curtain Wonderland that would be immediately cash flow positive and funded from existing debt facilities.
"It is our intention to continue to grow the Kresta Group so that it maintains its position as a leading window covering company with a reach throughout Australia and New Zealand," Mr Zorbas said.
As part of its growth strategy Kresta expects to further increase its workforce, which has grown from approximately 800 staff, to over 1100 in the past three years.
