The Boost Juice business could be listed on the ASX in the near future, according to media reports.
The Australian has reported that The Riverside Company, the US based private equity company that owns 70% of Retail Zoo – which in turns owns the Boost Juice health drink franchise – is working with investment banks to finalise a sale of the business or potentially list on the Australian Stock Exchange.
Boost Juice has around 200 outlets in Australia, with around 25% owned by the company, and the rest run by franchisees. It was founded by Janine Allis in 2000, and has grown into one of Australia's most recognised and successful franchises. Now the company has expanded internationally, with 240 stores in 14 countries.
Apart from its shopping centre and airport outlets, Boost Juice has also started selling one litre and 350ml bottled products in Woolworths (ASX: WOW) and Coles – owned by Wesfarmers (ASX: WES) – supermarkets and stores. According to the Australian, Boost Juice has just 0.5% of the $1.7 billion fruit juice manufacturing market, but market share is growing.
Retail Zoo doesn't just own Boost Juice but has expanded into other food franchise brands, including Salsa's Frexh Mex Grill and CIBO Espresso and boasts a network of 350 stores. In that respect, it has something in common with Retail Food Group (ASX: RFG), which counts Michel's Patisseries, Pizza Capers, bb's café, Brumby's Bakeries and Donut King amongst its brands.
Janine and Jeff Allis are on the board of Retail Zoo, as executive director and executive chairman respectively. The company reported its fifth consecutive year of double-digit earnings before interest, tax, depreciation and amortisation (EBITDA) in 2013, with sales rising 30% to $221 million.
Retail Zoo CEO Scott Meneilly said in July that the outlook for 2014 was optimistic, and he sees the next 12 months as a time for growth for the company. He says Retail Zoo plans solid conservative growth of the espresso bar concept and wants to open one store per month over the next twelve months. An incredible 58 new stores over all three franchises were opened in the 2013 financial year.
Foolish takeaway
With a number of strong brands and amazing growth over the past five years as well as future potential, Foolish investors might want to follow the Retail Zoo developments.
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Motley Fool writer/analyst Mike King owns shares in Woolworths.
