Reports YOY Revenue Growth of 70% with Gross Profit growth of 56%

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Toronto, Ontario, May 24, 2022 (GLOBE NEWSWIRE) -- MiniLuxe Holding Corp. (TSXV: MNLX) today announced its financial results for the 13 weeks ended March 27, 2022 (“Q1 2022”). The fiscal year of MiniLuxe is a 52-week reporting cycle ending on the Sunday closest to December 31, which periodically necessitates a fiscal year of 53 weeks. All of the fiscal years referred to in this release consist of 52 week periods and all quarters referred to in this release consist of 13 week periods. Unless otherwise specified, all amounts are reported in U.S. dollars.

MiniLuxe is pleased to report total revenue of $4.4M in Q1 2022, a 70% increase over total revenue in the 13 weeks ended March 28, 2021 (“Q1 2021”). Gross profit increased by over 50% from $1.2M in Q1 2021 to $1.9M in Q1 2022. This performance was achieved despite COVID-related disruptions resulting from the Omicron variant and reduced operating hours throughout the first quarter of 2022 (relative to normal full levels of operating hours and station availability).

MiniLuxe continues to set the standard for health, hygiene, and fair labor practices across the nail and waxing industry. MiniLuxe aspires to be the leading talent empowerment platform for nail designers and waxing specialists to service and meet clients anywhere at anytime, including across MiniLuxe’s company-owned fleet and partner channels. New SG&A and capex investments in the first quarter have been deployed to continue strengthening growth quality in the existing base fleet while accelerating key growth initiatives in MiniLuxe product, the digital-first platform, talent acquisition strategies, and MiniLuxe Anywhere (off premises services).

Q1 2022 Financial Highlights ($USD)

• Total revenue of $4.4M, a YoY increase of 70%

• Gross profit of $1.9M, a 56% increase from prior year

• Q1 2022 demonstrated period growth surpassing Q1 2019 levels despite COVID-19 related demand issues resulting from the Omicron variant. $4.4M revenue was +10% to Q1 2019 on a like-for-like studio basis (pre-COVID comparable)

• SG&A consistent with prior year as a percentage of revenue, with improvement due to increased revenue as fleet was fully open (but still at reduced operating hours)

• Fleet Adjusted EBITDA for Q1 2022 at $66K up 120% from Q1 2021 of ($332K), as fleet operations continue to improve and demand grows YoY

• Full Company Adjusted EBITDA¹ of ($2.3M) compared to ($1.6M) for Q1 2021 attributable to SG&A increase to fund growth initiatives

Q1 2022 Business Highlights

• Achieved strong and in many cases record talent revenue performance vs. 2019 despite reduced operating capacity

• Increased fleet fixed cost leverage led to record level Q1 fleet contribution since 2015

• Weekly appointment counts surpassing H2 2021 averages by the end of Q1 giving confidence towards strong fleet momentum for 2022

• Relaunched e-commerce site website led to 50% new customer growth on Q1 2021

• MiniLuxe App downloads at 60K+, ~2x growth over 2020 due to revamped booking and purchasing experience on mobile app

• Ting Guo-Villaseñor appointed as MiniLuxe Anywhere General Manager

• Signed two new leases for market expansion in Florida at Water Street in Tampa and The Icon Central in St Petersburg. New studio operations are expected to commence in late 2022.
  
  

Year-over-year Q1 revenue growth v. Q1 2019 (a pre-pandemic year) highlights strong continued momentum from increasing COVID-19 vaccination rates, efficient and agile operational practices, and growth in clean self-care services. Throughout the pandemic, MiniLuxe’s mission of providing super-hygienic and ethical nail and waxing treatments resonated with consumers and has continued to do so post pandemic in Q1 2022. As demand resurges, recruitment and deployment of certified nail designers and waxing specialists remains the focal point of the business.

“We are thrilled to maintain strong revenue growth through the first quarter alongside strong gross profit momentum. As demand continues to outstrip supply, we are working hard on initiatives to accelerate the pace of talent acquisition and expand our brand to new geographies that have high concentrations of talent supply and where we believe our product will also experience rapid consumer uptake,” said Tony Tjan, Chairman and Co-founder of MiniLuxe.

“We are proud to continue the momentum of our year-over-year growth numbers. MiniLuxe has continued to hit new key metrics records and has seen an increase in digital app usage. MiniLuxe Anywhere initiatives including implementing a new leader to spearhead the effort and launching pilots across two geographies bode well for expanded growth and allow for more client touchpoints to experience the MiniLuxe brand,” noted Zoe Krislock, CEO of MiniLuxe.

Q1 2022 Results

Selected Financial Measures

MiniLuxe notes a change in accounting policy to more accurately reflect revenue generated from talent and product revenue streams to more align with how management analyzes the Company. The change has been retrospectively applied and does not have any effect on revenue recognition principles utilized or total overall revenue recognized.

Non IFRS Metrics

Results of Operations

The following table outlines our consolidated statements of loss and comprehensive loss for the fiscal quarters ended March 27, 2022 and March 28, 2021:

Cash Flows

The following table presents cash and cash equivalents as at March 27, 2022 and March 28, 2021:

Non-IFRS Measures and Reconciliation of Non-IFRS Measures

This press release references certain non-IFRS measures used by management. These measures are not recognized measures under International Financial Reporting Standards (“IFRS”), do not have a standardized meaning prescribed by IFRS, and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company’s results of operations from management’s perspective. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of the Company’s financial information reported under IFRS. The non-IFRS measures referred to in this press release are “Adjusted EBITDA” and “Fleet Adjusted EBITDA”.

Adjusted EBITDA

Adjusted EBITDA is used by management as a supplemental measure to review and assess operating performance. Management believes Adjusted EBITDA most accurately reflects the commercial reality of the Company's operations on an ongoing basis by adding back non-cash expenses. Additionally, the rent-related adjustments ensure that studio-related expenses align with revenue generated over the corresponding time periods.

Adjusted EBITDA is calculated by adding back fixed asset depreciation, right-of-use asset depreciation under IFRS 16, asset disposal, and share-based compensation expense to IFRS operating income, then deducting straight-line rent expenses² net of lease abatements. IFRS operating income is revenue less cost of sales (gross profit), additionally adjusted for general and administrative expenses, stock listing expense, and depreciation and amortization expense.

The Company also uses Fleet Adjusted EBITDA to evaluate its fleet performance. This metric is calculated in a similar manner, starting with Talent revenue and adjusting for non-fleet Talent revenue and cost of sales, further adjusted by fleet SG&A and finally subtracting the same straight line rent expense used in the full company Adjusted EBITDA (as the fleet holds all real estate leases). The Company believes that this metric most closely mirrors how management views the fleet portion of the business.

The following table reconciles Adjusted EBITDA to net loss for the periods indicated:

The following table reconciles Fleet Adjusted EBITDA to net loss for the periods indicated:

About MiniLuxe

MiniLuxe, a Delaware corporation based in Boston, Massachusetts is a digital-first, socially-responsible lifestyle brand and talent empowerment platform for the nail and waxing industry. For over a decade, MiniLuxe has been setting industry standards for health, hygiene, and fair labor practices in its efforts to transform the heavily-used but highly under-regulated nail care industry. MiniLuxe looks to become one of the largest inclusionary educators and vocational employers, with a diverse, predominantly female and BIPOC workforce on its talent empowerment platform.

Today, MiniLuxe derives its revenue streams from talent (provision of nail care and waxing services) and product (sales of proprietary clean nail care products). MiniLuxe is driven by a fully-integrated digital platform that manages all client bookings, preferences, and payments and provides designers with the ability to manage scheduling and client preferences, track their performance and compensation, and access training content. Since its inception, MiniLuxe has performed nearly 3 million services. www.miniluxe.com

For further information

Anthony Tjan
Executive Chairman, MiniLuxe Holding Corp.
atjan@miniluxe.com

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

¹ Please refer to “Non-IFRS Measures and Reconciliation of Non-IFRS Measures” sections of this press release.
² Straight-line rent expense for a given payment period is calculated by dividing the sum of all payments over the life of the lease (the figure used in the present value calculation of the right-of-use asset) by the number of payment periods (typically months). This number is then annualized by adding the rent expenses calculated for the payment periods that comprise each fiscal year. For leases signed mid-year, the total straight-line rent expense calculation applies the new lease terms only to the payment periods after the signing of the new lease.