17 September 2012: iSelect IPO and Body scanners for clothes shopping

Rip Curl for sale: Founded in 1969, two founders own 72 percent of the company, could make more than $100 million each if the brand fetches $400 million, but $300 million could be more realistic. Rip Curl operates corporate stores in Australia, New Zealand, Europe, USA, Canada, England, Israel, South America, and South Africa. About half of sales come from Australia. Company booked $7.9 million profit year to June 30 2011, down from $15.5 million in FY2010. Sales fell 8 percent to $362.4 million. During 2012, acquired 24 Rip Curl branded stores in Australia and South Africa. While Billabong and Quicksilver have opted for stockmarket listings to fuel expansion, Rip Curl remains private. [CR: Two guys and a sewing machine 60 years ago, now looking to clear $100 million. Would you stick with what you are doing now for that long for a chance at those returns?]

iSelect seeking IPO: Originally founded as comparison shopping site for the health insurance market, has expanded into life insurance, general insurance, home loans, energy, and broadband. Recorded $112 million revenue FY2012, of which 81 percent came from health insurance arm. EBIDTA worth $24.1 million, up 38 percent came from traditional health insurance arm. If EBIDTA  targets of $30.9 million in FY2013 and $41.8 million are hit, it could mean a $600 million IPO next year. Expected revenue growth of 10 percent per year. NineMSN owns 33 percent of iSelect. Around 500,000 new policies are written annually, of which 215,000 are sales to new market entrants and 285,000 result from switching funds. [CR: Comparison sites are the big winners in a tightly competitive market.  The more the big companies fight, the more the comparison tools win.]

Myer’s online plans: Online sales account for 1 percent of sales, expected to generate 10 percent to 15 percent within a few years. Building core competency rather than acquiring. Myer has spent $600 million on transforming itself into an “omni-retailer”, combining online offer with traditional brick and mortar stores. Company is 75 percent of the way there, with about $30 million still to be spent. Company is likely to shit more stores as online retailing grew. [CR: Online replacing brick and mortar, but creating jobs elsewhere.]

Online banking and debit card stats: PwC research – the websites of the big four banks rank among the top 25 percent most visited sites of the nation. About 75 percent of banking customers use digital banking. Bankwest research - Debit cards are the fastest growing payments category, with 2.6 billion transactions over the year to November 2011. Debit cards account for 37 percent of all non-cash retail transactions in 12  months to November, grew 95 percent over five years.

Body scanners used for clothes shopping: Trials in US using body scanner technology to help with fitting clothes.  Around 89 percent of US clothes shopping happens in bricks-and-mortar stores. UK-based Bodymetrics and LA based Styku both have scanners based on infrared motion sensors found in the Mocrosoft Kinect. Berlin’s Upcload offers home scans using webcams and image-processing technology. Unique Solutions Design has been licensed with similar to airport xray scanners, but not the same that have sparked concerns over x-ray radiation. Americans spent $25 billion on clothes and accessories online  in 12 months to June, out of a total of $173 billion spent online. [CR: We are afraid of the technology in airports, but as soon as it can help us find the right shirt size we think it’s OK.]

Green Building Council of Australia issued its 500^th Green star sustainability rating. There are 8 million square metres of Green Star certified space around Australia. 40,000 people have been trained on sustainability practices.  The rating system is nine years old. Green-star assets deliver a 5 percent value premium and a 12 percent rent premium. The change has been achieved with little government intervention, apart from the move by governments to higher-rated tenancies and rules on advertising ratings.  [CR: Good to see the tipping point.]