A touch of Hollywood helps Ghd smash £150m turnover barrier

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IT’s a long and winding road from Silsden to Sunset Boulevard.

A hairstyling brand which was founded in a small Yorkshire town has smashed the £150m turnover barrier with a little help from the likes of Katy Perry and Jennifer Aniston.

Ghd – which stands for ‘good hair day’ – was established in Silsden, West Yorkshire, in 2001 by chemist Martin Penny, plant-hire specialist Gary Douglas and hairdresser Robert Powls.

In recent years, the company has seen its turnover soar on the back of celebrity endorsements from Hollywood stars such as Gwyneth Paltrow.

The company’s upmarket styling irons have proved popular among hairstylists because of their curved barrels and ceramic plates.

This means that women can use the irons to change their look, without damaging their hair.

Initially, Ghd claimed that much of the sales growth had been driven by word of mouth recommendations.

Sales of the irons rose from just 20 per week to more than 20,000 a week between 2001 and 2003.

Today, the firm, which is based in Bridgewater Place in Leeds and owned by Montagu Private Equity, plans to increase its share of global markets, and help more women look good in the process.

In 2011, Ghd’s turnover rose by 5.3 per cent to £155.3m and its operating profit increased by 35 per cent to £21.6m.

Earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 10.7 per cent to £24.1m.

The company declined to provide a spokesman to comment on the results yesterday.

Results filed at Companies House by Jemella, the company behind Ghd, reveals that staff numbers increased from 237 to 245 last year.

A directors’ report to accompany the results states that Ghd is the UK’s leading brand of hair styling irons, and it is also establishing a leading position overseas.

The statement adds: “Many companies with which we compete or which may enter into competition with us, have substantial financial, marketing and technical resources. To mitigate this risk, we continue to invest in our strong salon relationships, invest in retaining our professional brand position and [we are] constantly improving and innovating new products.

“In 2009, the company appointed a new supplier with its headquarters in Europe and with a global footprint, whose capabilities will allow them to grow as a partner alongside Ghd.

“In 2011, the company appointed a further global manufacturing partner, and is now fully dual sourced. In addition, all intellectual property relating to our core products is owned by the company.”

According to the accounts, Jemella is reviewing the need to enter into derivative contracts to reduce its exposure to the variability of foreign exchange.

In March, it was confirmed that veteran retailer John Lovering has joined Ghd as non-executive chairman. Mr Lovering is a heavyweight in the world of retail, having chaired companies such as Debenhams, Homebase, Peacocks, Somerfield and Go Outdoors.

Mr Lovering is also regarded as a dealmaker, which has prompted speculation that Ghd’s owner, Montagu Private Equity, might be preparing the company for a sale.

Montagu bought Ghd in a £160m buyout in July 2007, near the top of the market for leveraged deals.

Co-founder Martin Penny launched a High Court legal action against Montagu in November 2011, claiming that he was unfairly ousted in a boardroom coup in December 2008.

In March, the Yorkshire Post reported that Montagu and Mr Penny had reached a settlement in early January 2012.

A spokeswoman for Montagu would not discuss the terms of the agreement, when contacted by the Yorkshire Post in March..

Mr Penny also declined to comment.

The firm’s performance has been boosted since the buyout by moving to a new French supplier, which works partially in Britain.

The identity of the Parisian firm is not known but it is understood to have a global manufacturing capability with operations in Bedford, Morocco, China and the US.

It provides equipment for the majority of the business, with material such as packaging and bags sourced elsewhere.

Ghd has bought distributors in Brisbane and Sydney and in South Africa since 2008 .

The company also supports good causes.

In 2009, Ghd made a contribution of £1.6m to Breakthrough Breast Cancer which brought its total level of charitable giving to £7.5m.

The company’s profile is still being boosted by its famous fans.

In her role as Ghd brand ‘ambassador’, the singer Katy Perry has appeared in a series of campaigns shot by photographer David LaChapelle.

Stylists Zoe Irwin and Kenna represent the brand within the hairdressing industry.

greg.wright@ypn.co.uk

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