이 기사는 2020년 05월 01일 08:00 thebell 에 표출된 기사입니다.

Juvis Diet, a South Korean company that offers weight-loss coaching programs, has been put up for sale, attracting interest from prospective buyers with its high profitability.

Juvis Diet has hired Samsung Securities to lead a sale of the company, sources familiar with the matter said on April 27. The securities firm has started marketing efforts targeting both strategic investors and private equity firms in the country. The seller is said to be considering a sale of a 100 percent stake in the company.

Founded in 2002, Juvis Diet has grown rapidly in recent years, as it gained popularity with its celebrity customers. The company is catching the eye of potential buyers due to its high profitability.

Juvis Diet posted 47.9 billion won in revenue and 14.2 billion won in operating income for 2019. Its EBITDA, calculated excluding the effects of internal transactions, is estimated at roughly 15 billion won, which accounts for more than 30 percent of revenue.

This makes Juvis Diet one of the most profitable companies in its industry, as a majority of market players are small in size, with few of them reporting operating income margin of more than 10 percent.

“Juvis Diet is attractive enough to catch the eye of PE firms as it can generate cash flow equivalent to about one third of its revenue,” an industry insider said. “That is probably attributable to its unique business model.”

Juvis Diet not only offers weight-loss programs but also sells health functional food products. Typically, its program – which lasts four to five weeks with four classes each week – costs 200,000 won to 500,000 won per class.

The time its customers spend at the center for each class is less than two hours on average. Such a high customer turn-out means the company needs to rent less space. With a relatively high average order value (AOV), the company’s weight-loss solutions segment itself generates a large profit margin.

Juvis Diet also sells health functional food products. Though the exact figures are unknown, a large number of customers getting the company’s weight-loss programs seemingly tend to buy such food products, industry observers said.

The company has solidified its current business model after mergers with Juvis Food, which produces health functional foods, and Juvis Mall, a platform which sells such foods as well as healthcare-related equipment and products, last year.

(By reporter Choi Ik-hwan)