I am delighted to offer you the opportunity to become a shareholder of dusk.
dusk has grown to become the leading Australian omni-channel specialty retailer focused on Home
Fragrance Products. Our range is developed in-house and sold through our national store network and
online channel under the ‘dusk’ brand.
The product offering comprises candles, ultrasonic diffusers, reed diffusers and essential oils, as well as
fragrance related homewares. Our goal is to be our customers’ preferred destination for Home Fragrance
Products and for their gifting needs – including personal indulgences and ‘gifts for one’s self’.
We offer our customers:
• the fragrances they know and love;
• regular releases of new and exciting products;
• great value for money; and
• outstanding specialist service across both our physical stores and online channel.
The Home Fragrance Market is substantial and was estimated to represent approximately $461.5 million
of annual retail sales in FY20 and is forecast to grow by approximately 8.3% to the end of FY211
. In FY20,
dusk had approximately 22% share of sales in the Home Fragrance Market2.
dusk operates a ‘vertical’ retail model, whereby the products we sell are designed by our in-house team,
and sold through our national store network and online channel – not via any third party retailers,
marketplaces, distributors, wholesalers or other intermediaries. Our manufacturing and logistics are
outsourced to external partners to enable efficiency and flexibility.
Our channels to market comprise our growing national store network and our online channel. Our customers
can shop in store and transact online, and vice versa, at a time that suits them. Our goal is to allow our
customer flexibility in how, when and where to shop with us. We continue to evolve our offer and omnichannel strategy as consumer preferences change.
Driving our customer experience is our membership program called ‘dusk Rewards’, which has become
the centerpiece for all our marketing and data analytics. The dusk Rewards loyalty program is a powerful
customer engagement tool and provides our members (in excess of 550,000 as at the Prospectus Date)
with additional discounts and exclusive offers in store and online. Importantly, dusk Rewards is a paid loyalty
program where the average transaction value of a dusk Rewards member is approximately 1.4x higher than
a non-rewards member, with dusk Rewards members contributing approximately 56% of FY20 total revenue.
Over the last six months dusk has adapted well to the impact of COVID-19. During that time, we have seen
material shifts in consumer preferences and buying patterns. We have observed a significant increase in
sales since our store network reopened in early May 2020. This is consistent with broader economic data
which indicates that consumers are spending more on home improvement and household comfort3
The Board of Directors has significant specialty retail experience, as does our senior management team led
by Chief Executive Officer Peter King. Peter has led dusk for the past six years and possesses a wealth of
experience across the broader consumer environment. The Company has performed strongly under Peter’s
leadership and has made significant investment in building our team, particularly in the areas of finance,
eCommerce, product design and marketing.
dusk has delivered impressive financial results over recent years. Total revenue growth was 15.8% in FY19
and 17.2% in FY20, underpinned by strong like for like sales growth of 7.9% and 17.5% in each period
respectively. Pro forma EBITDA margins have progressively improved over recent years and were in excess
of 15% in FY20.
The Board and Management are focused on the ongoing growth of dusk which will be underpinned
by five pillars:
1. continued store roll-out in Australia, with a clear plan, a strong track record of successful execution,
and a history of delivering attractive returns on this investment;
2. expansion and continued innovation and differentiation of our product range with key focus on the
wellness product trends including the use of technology to enhance our Home Fragrance Products;
3. further investment into the online channel;
4. enhanced utilisation of the dusk Rewards program and associated database as a key driver for targeted
marketing and promotional activities; and
5. potential international expansion, first into New Zealand subject to overall market conditions.
The Offer will raise $70.0 million through the issue and transfer of 35.0 million Shares at an Offer Price
of $2.00 per Share. dusk’s initial public offering and listing on the ASX will provide dusk with access to capital
markets and allow certain Existing Shareholders to realise part of their investment in dusk. On Completion
of the Offer, the Existing Shareholders, being funds advised or managed by Catalyst Investment Managers
Pty Ltd, BB Retail Capital Pty Ltd and its associates, existing Management and Director Shareholders and
other Existing Shareholders will together hold 43.8% of the Shares on issue. 26.1 million of Shares, equal to
42.0% of the Shares on issue at Completion of the Offer, which are held by certain Existing Shareholders,
will be subject to Escrow Arrangements from Completion of the Offer.
This Prospectus contains detailed information about the Offer, the industry in which dusk operates, and
dusk’s financial and operating performance. As with other businesses, dusk is subject to a range of risks,
which if they occur, may have a negative impact on dusk’s financial performance and position. These risks
include, among others, COVID-19 impacting dusk’s operations and performance, negative changes to the
Australian retail environment and economy, customer buying habits changing, actions of competitors or
Management being unable to achieve dusk’s growth objectives. These risks are detailed more fully
in Sections 1.5 and 5.
Applications for Shares can only be made by completing and lodging an Application Form attached to or
accompanying this Prospectus. Instructions on how to apply for Shares are set out in Sections 1.8 and 7 of
this Prospectus and on the back of the Application Form.
Before deciding on whether to invest in dusk, you should read this Prospectus carefully and consult with your
accountant, financial adviser, stockbroker, lawyer or other professional adviser.
The Directors and Management look forward to welcoming you as a dusk shareholder.