Continues to position Regis for future
growth with the integration of the Alline Salon Group
acquisition
Regis Corporation (NasdaqGM: RGS), a leader in the haircare
industry, today announced financial results for the second fiscal
quarter ended December 31, 2024.
Matthew Doctor, Regis Corporation’s President and Chief
Executive Officer, commented, “Our business has undergone a
remarkable transformation over a short period of time. The Alline
acquisition that was completed at the end of the fiscal quarter
marks yet another step to position Regis to deliver future growth
by adding several profitability and cash flow levers that
complement our franchise business, creating a well-diversified
model and an optimal mix of franchised and company owned locations.
From a results standpoint, with growth across key profitability
metrics, our fiscal second quarter results reflect strong
operational execution and business traction, despite challenging
sales conditions. We are excited to continue executing against our
priorities, that now include the Alline portfolio, to drive growth
and financial performance across our entire system of branded
salons."
Financial Highlights:
Second quarter fiscal 2025 compared to second quarter fiscal
2024:
- Consolidated revenue of $46.7 million versus $51.1 million;
driven by lower non-margin franchise rental income and lower
advertising fund contributions, partially offset by company-owned
salon revenue
- Same-store sales decreased 1.6% versus second quarter 2024
- Net income of $7.6 million, inclusive of income from
discontinued operations of $7.4 million, versus $1.0 million,
inclusive of income from discontinued operations of $2.0 million in
prior year second quarter; Diluted EPS of $2.71 versus $0.43 in
second quarter 2024
- Adjusted net income of $1.7 million versus an adjusted net loss
of $0.4 million in prior year second quarter; Adjusted EPS of $0.61
versus $(0.18) in second quarter 2024
- Adjusted EBITDA of $7.1 million versus $6.3 million in prior
year second quarter
First half fiscal 2025 compared to first half fiscal
2024:
- Consolidated revenue of $92.8 million versus $104.4 million;
driven by lower non-margin franchise rental income and lower
advertising fund contributions
- Same-store sales decreased 1.4% versus the prior year
- Net income of $6.8 million, inclusive of income from
discontinued operations of $8.4 million, versus $2.2 million,
inclusive of income from discontinued operations of $2.0 million in
prior year; Diluted EPS of $2.90 versus $0.93 in the prior
year
- Adjusted net income of $4.3 million versus $1.3 million in
prior year; Adjusted EPS of $1.51 versus $0.53 in prior year
- Adjusted EBITDA of $14.8 million versus $14.4 million in prior
year
Second Quarter Fiscal Year 2025
Consolidated Results
Three Months Ended December
31,
Six Months Ended December
31,
(Dollars in millions, except per share
data)
2024
2023
2024
2023
Consolidated revenue
$
46.7
$
51.1
$
92.8
$
104.4
System-wide revenue (1)
274.1
292.4
559.7
599.0
System-wide same-store sales comps
(1.6
)%
1.9
%
(1.4
)%
1.8
%
Operating income
$
5.5
$
4.8
$
7.6
$
12.2
Income (loss) from continuing
operations
0.2
(1.0
)
(1.6
)
0.2
Diluted income (loss) per share from
continuing operations
0.07
(0.43
)
(0.68
)
0.08
Income from discontinued operations
7.4
2.0
8.4
2.0
Net income
7.6
1.0
6.8
2.2
Diluted earnings per share
2.71
0.43
2.90
0.93
Adjusted operating income
7.0
5.4
13.6
13.3
Adjusted EBITDA (2)
7.1
6.3
14.8
14.4
Adjusted net income (loss)
1.7
(0.4
)
4.3
1.3
Adjusted diluted earnings per share
0.61
(0.18
)
1.51
0.53
_______________________________________________________________________________
(1)
Represents total sales within the
system.
(2)
See GAAP to non-GAAP reconciliations
within the attached section titled "Non-GAAP Reconciliations."
Consolidated Revenue
Total consolidated revenue of $46.7 million in the second
quarter 2025 and $92.8 million in the first half 2025, declined
$4.3 million and $11.6 million, respectively. The decline was
driven primarily by a reduction in non-margin franchise rental
income and advertising fund contributions, which was partially
offset by an increase in company-owned salon revenue resulting from
the acquisition of Alline on December 19, 2024.
Operating Income
Regis reported second quarter 2025 operating income of $5.5
million, an improvement of $0.7 million compared to $4.8 million in
the second quarter 2024. The year-over-year improvement in
operating income was driven primarily by operating income from the
Alline salons.
Regis reported first half 2025 operating income of $7.6 million,
a decline of $4.6 million compared to $12.2 million in the first
half 2024. The year-over-year decline in operating income was
driven primarily non-recurring severance costs.
Income (Loss) from Continuing Operations
Regis reported second quarter 2025 income from continuing
operations of $0.2 million, or $0.07 per diluted share, compared to
a loss from continuing operations of $1.0 million, or $(0.43) per
diluted share, in the second quarter 2024. The improvement was
driven primarily by improvements to the Company’s cost structure
and income generated by the Alline salons.
Regis reported first half 2025 loss from continuing operations
of $1.6 million, or $(0.68) per diluted share, compared to income
from continuing operations of $0.2 million, or $0.08 per share, in
the second half 2024. The year-over-year decline was driven
primarily by lower operating income in the first quarter of fiscal
2025 as a result of non-recurring severance costs, partially offset
by a decrease in interest expense.
Net Income
The company reported second quarter 2025 net income of $7.6
million, or $2.71 per diluted share, compared to net income of $1.0
million, or $0.43 income per diluted share, for the same period
last year. The company reported first half 2025 net income of $6.8
million, or $2.90 diluted income per share, compared to $2.2
million and $0.93 for the second half 2024. The year-over-year
increases for the two periods were driven primarily by a gain
related to discontinued operations.
Adjusted EBITDA
Second quarter and first half 2025 adjusted EBITDA of $7.1
million and $14.8 million, improved $0.8 million and $0.4 million,
respectively, compared to $6.3 million and $14.4 million in the
same periods last year. The improvement in both periods was
primarily related to the Alline salons and improved cost
structure.
Second Quarter Fiscal Year 2025 Segment
Results
Franchise
Three Months Ended
December 31,
Increase
Six Months Ended
December 31,
Increase
(Dollars in millions) (1)
2024
2023
2024
2023
Royalties
$
14.8
$
15.8
$
(1.0
)
$
30.5
$
32.3
$
(1.8
)
Fees
2.9
2.5
0.4
5.3
5.1
0.2
Product sales to franchisees
—
0.1
(0.1
)
—
0.5
(0.5
)
Advertising fund contributions
5.5
6.8
(1.3
)
11.1
14.0
(2.9
)
Franchise rental income
20.0
24.1
(4.1
)
41.7
48.8
(7.1
)
Total franchise revenue
$
43.3
$
49.3
$
(6.0
)
$
88.5
$
100.7
$
(12.2
)
Franchise same-store sales comps
(1.5
)%
1.9
%
(1.3
)%
1.8
%
Franchise adjusted EBITDA
$
6.4
$
6.6
$
(0.2
)
$
14.4
$
15.2
$
(0.8
)
as a percent of revenue
14.8
%
13.5
%
16.3
%
15.1
%
as a percent of adjusted revenue (2)
36.1
%
36.1
%
40.3
%
40.1
%
Total franchise salons
3,925
4,651
(726
)
as a percent of total franchise and
company-owned salons
92.4
%
98.8
%
_______________________________________________________________________________
(1)
Total is a recalculation; line items
calculated individually may not recalculate due to rounding.
(2)
Adjusted revenue excludes non-margin
revenue. See GAAP to non-GAAP reconciliations within the attached
section titled "Non-GAAP Reconciliations."
Franchise Revenue
Second quarter franchise revenue was $43.3 million, a $6.0
million, or 12.2% decrease compared to the prior year quarter.
First half 2025 franchise revenue was $88.5 million, a 12.1%
decline compared to the first half of the prior year. Decreases in
franchise salon count and same-store sales were the primary drivers
of the declines.
Royalties were $14.8 million and $30.5 million, a $1.0 million
and $1.8 million, or 6.3% and 5.6% decrease for the second quarter
and first half 2025, compared to the same period last year. The
declines were due to fewer franchise salons and lower same-store
sales.
Franchise Adjusted EBITDA
Second quarter franchise adjusted EBITDA of $6.4 million
declined $0.2 million. First half 2025 franchise adjusted EBITDA of
$14.4 million declined $0.8 million year-over-year. The declines
are primarily due to a decrease in royalties, partially offset by
lower general and administrative expenses.
Company-Owned Salons
Three Months Ended
December 31,
Increase (Decrease)
Six Months Ended
December 31,
Increase (Decrease)
(Dollars in millions) (1)
2024
2023
2024
2023
Total company-owned salon revenue
$
3.5
$
1.8
$
1.7
$
4.2
$
3.7
$
0.5
Company-owned salon adjusted EBITDA
$
0.7
$
(0.3
)
$
1.0
$
0.4
$
(0.8
)
$
1.2
as a percent of revenue
20.0
%
(16.7
)%
9.5
%
(21.6
)%
Total company-owned salons
323
58
265
as a percent of total franchise and
company-owned salons
7.5
%
1.2
%
_______________________________________________________________________________
(1)
Variances calculated on amounts shown in
millions may result in rounding differences.
Company-Owned Salon Revenue
Second quarter revenue for the company-owned salon segment
increased $1.7 million versus the prior year to $3.5 million. First
half 2025 revenue for the company-owned salon segment improved $0.5
million versus the prior year to $4.2 million. The year-over-year
increases were primarily driven by the Alline acquisition,
partially offset by other company-owned store closures.
Company-Owned Salon Adjusted EBITDA
Second quarter company-owned salon adjusted EBITDA improved $1.0
million from the same period last year. First half 2025
company-owned salon adjusted EBITDA improved $1.2 million versus
the prior year to $0.4 million. The year-over-year improvements
were due to the Alline acquisition, partially offset by the
wind-down of underperforming company-owned salons.
Balance Sheet and Cash
Flow
The Company ended the second quarter of fiscal year 2025 with
$10.2 million in cash and cash equivalents, $126.4 million in
outstanding borrowings and available total liquidity of $15.9
million. Net cash provided by operating activities for the six
months ended December 31, 2024, totaled $0.8 million, an
improvement of $7.6 million from the six months ended December 31,
2023, due to lower operating costs. Cash used in investing
activities includes $18.6 million for Alline acquisition.
Non-GAAP Reconciliations
For GAAP to non-GAAP reconciliations, please refer to the
attached section titled "Non-GAAP Reconciliations." A complete
reconciliation of reported earnings to adjusted earnings is
included in this press release and is available on the Company’s
website at www.regiscorp.com.
Earnings Webcast
Regis Corporation will host a conference call via webcast
discussing second quarter results today, February 12, 2025, at 7:30
a.m. Central time. Interested parties are invited to participate in
the live webcast by registering for the event at
www.regiscorp.com/investor-relations.html. A replay of the
presentation will be available on our website at the same web
address.
About Regis Corporation
Regis Corporation (NasdaqGM:RGS) is a leader in the haircare
industry. As of December 31, 2024, the Company franchised or owned
4,248 locations. Regis’ franchised and corporate locations operate
under concepts such as Supercuts®, SmartStyle®, Cost Cutters®,
Roosters®, and First Choice Haircutters®. For additional
information about the Company, including a reconciliation of
certain non-GAAP financial information and certain supplemental
financial information, please visit the Investor Relations section
of the corporate website at www.regiscorp.com.
This press release contains or may contain “forward-looking
statements” within the meaning of the federal securities laws,
including statements concerning anticipated future events and
expectations that are not historical facts. These forward-looking
statements are made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. The
forward-looking statements in this document reflect management’s
best judgment at the time they are made, but all such statements
are subject to numerous risks and uncertainties, which could cause
actual results to differ materially from those expressed in or
implied by the statements herein. Such forward-looking statements
are often identified herein by use of words including, but not
limited to, “may,” “will,” “believe,” “project,” “forecast,”
“expect,” “estimate,” “anticipate,” and “plan.” In addition, the
following factors could affect the Company's actual results and
cause such results to differ materially from those expressed in
forward-looking statements. These factors include a potential
material adverse impact on our business and results of operations
as a result of changes in consumer shopping trends and changes in
manufacturer distribution channels; laws and regulations could
require us to modify current business practices and incur increased
costs including increases in minimum wages; changes in general
economic environment; changes in consumer tastes, hair product
innovation, fashion trends and consumer spending patterns;
compliance with Nasdaq listing requirements; our ability to realize
the anticipated benefits of the Alline Acquisition; reliance on
franchise royalties and overall success of our franchisees’ salons;
our salons' dependence on a third-party supplier agreement for
merchandise; our and our franchisees' ability to attract, train and
retain talented stylists and salon leaders; the success of our
franchisees, which operate independently; data security and privacy
compliance and our ability to manage cyber threats and protect the
security of potentially sensitive information about our guests,
franchisees, employees, vendors or Company information; the ability
of the Company to maintain a satisfactory relationship with
Walmart; marketing efforts to drive traffic to our franchisees'
salons; our ability to maintain and enhance the value of our
brands; reliance on legacy information technology systems; reliance
on external vendors; the use of social media; the effectiveness of
our enterprise risk management program; our ability to minimize
risks associated with owning and operating additional salons;
ability to generate sufficient cash flow to satisfy our debt
service obligations; compliance with covenants in our financing
arrangement; premature termination of agreements with our
franchisees; the continued ability of the Company to implement cost
reduction initiatives and achieve expected cost savings; continued
ability to compete in our business markets; potential liabilities
related to the employee retention credit received by Alline;
changes in trade policies, treaties, tariffs and customs duties and
taxes; reliance on our management team and other key personnel; the
continued ability to maintain an effective system of internal
control over financial reporting; changes in tax exposure; the
ability of our Tax Preservation Plan to protect the future
availability of the Company's tax assets; potential litigation and
other legal or regulatory proceedings; or other factors not listed
above. Additional information concerning potential factors that
could affect future financial results is set forth under Item 1A on
Form 10-K. We undertake no obligation to publicly update or revise
any forward-looking statements, whether as a result of new
information, future events or otherwise. However, your attention is
directed to any further disclosures made in our subsequent annual
and periodic reports filed or furnished with the SEC on Forms 10-K,
10-Q and 8-K and Proxy Statements on Schedule 14A.
REGIS CORPORATION
CONDENSED CONSOLIDATED BALANCE
SHEETS (Unaudited)
As of December 31, 2024, and
June 30, 2024
(Dollars in thousands, except
per share data)
December 31,
2024
June 30, 2024
ASSETS
Current assets:
Cash and cash equivalents
$
10,198
$
10,066
Receivables, net
8,313
9,434
Other current assets
24,921
22,550
Total current assets
43,432
42,050
Property and equipment, net
10,699
3,664
Goodwill
188,975
173,146
Other intangibles, net
2,301
2,427
Right of use asset
266,513
287,912
Other assets
18,191
21,297
Total assets
$
530,111
$
530,496
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current liabilities:
Accounts payable
$
16,451
$
12,747
Accrued expenses
20,097
21,644
Short-term lease liability
70,971
69,127
Total current liabilities
107,519
103,518
Long-term debt, net
111,532
99,545
Long-term lease liability
206,872
230,607
Other non-current liabilities
37,470
40,039
Total liabilities
463,393
473,709
Commitments and contingencies
Shareholders' equity:
Common stock, $0.05 par value; issued and
outstanding, 2,435,979 and 2,279,948 common shares at December 31,
2024, and June 30, 2024, respectively
122
114
Additional paid-in capital
73,243
69,660
Accumulated other comprehensive income
8,132
8,584
Accumulated deficit
(14,779
)
(21,571
)
Total shareholders' equity
66,718
56,787
Total liabilities and shareholders'
equity
$
530,111
$
530,496
REGIS CORPORATION
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (Unaudited)
For the Three and Six Months
Ended December 31, 2024, and 2023
(Dollars and shares in
thousands, except per share data)
Three Months Ended
December 31,
Six Months Ended
December 31,
2024
2023
2024
2023
Revenues:
Royalties
$
14,840
$
15,820
$
30,486
$
32,348
Fees
2,917
2,492
5,269
5,123
Product sales to franchisees
—
67
—
451
Advertising fund contributions
5,490
6,808
11,131
14,034
Franchise rental income
20,022
24,087
41,658
48,754
Company-owned salon revenue
3,450
1,779
4,235
3,715
Total revenue
46,719
51,053
92,779
104,425
Operating expenses:
Cost of product sales to franchisees
—
58
—
417
General and administrative
11,155
11,772
25,189
22,501
Rent
2,149
1,394
3,213
2,491
Advertising fund expense
5,490
6,808
11,131
14,034
Franchise rent expense
20,022
24,087
41,658
48,754
Company-owned salon expense (1)
1,946
1,308
2,699
2,798
Depreciation and amortization
460
677
906
1,047
Long-lived asset impairment
—
170
352
170
Total operating expenses
41,222
46,274
85,148
92,212
Operating income
5,497
4,779
7,631
12,213
Other (expense) income:
Interest expense
(4,848
)
(6,188
)
(9,694
)
(12,376
)
Other, net
(307
)
299
370
99
Income (loss) from operations before
income taxes
342
(1,110
)
(1,693
)
(64
)
Income tax (expense) benefit
(136
)
107
89
255
Income (loss) from continuing
operations
206
(1,003
)
(1,604
)
191
Income from discontinued operations
7,439
2,000
8,396
2,000
Net income
$
7,645
$
997
$
6,792
$
2,191
Net income per share:
Basic:
Income (loss) from continuing
operations
$
0.09
$
(0.43
)
$
(0.68
)
$
0.08
Income from discontinued operations
3.20
0.85
3.58
0.86
Net income per share (2)
$
3.29
$
0.43
$
2.90
$
0.94
Diluted:
Income (loss) from continuing
operations
$
0.07
$
(0.43
)
$
(0.68
)
$
0.08
Income from discontinued operations
2.63
0.85
3.58
0.84
Net income per share, diluted (2)
$
2.71
$
0.43
$
2.90
$
0.93
Weighted average common and common
equivalent shares outstanding:
Basic
2,324
2,341
2,346
2,336
Diluted
2,825
2,341
2,346
2,367
_______________________________________________________________________________
(1)
Includes cost of service and product sold
to guests in our company-owned salons. Excludes general and
administrative expense, rent, and depreciation and amortization
related to company-owned salons.
(2)
Total is a recalculation; line items
calculated individually may not sum to total due to rounding.
REGIS CORPORATION
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS (Unaudited)
For the Six Months Ended
December 31, 2024, and 2023
(Dollars in thousands)
Six Months Ended December
31,
2024
2023
Cash flows provided by (used in) operating
activities:
Net income
$
6,792
$
2,191
Adjustments to reconcile net income to
cash provided by (used in) operating activities:
Gain from sale of OSP
(8,396
)
(2,000
)
Depreciation and amortization
853
1,005
Deferred income taxes
(197
)
(29
)
Non-cash interest
2,513
1,290
Long-lived asset impairment
352
170
Stock-based compensation
1,604
890
Amortization of debt discount and
financing costs
1,605
1,493
Other non-cash items affecting
earnings
569
(29
)
Changes in operating assets and
liabilities, excluding the effects of asset sales and business
acquisitions(1)
(4,909
)
(11,834
)
Net cash provided by (used in) operating
activities
786
(6,853
)
Cash flows provided by (used in) investing
activities:
Capital expenditures
(444
)
(323
)
Business acquisitions, net of cash
acquired and certain obligations assumed
(18,631
)
—
Proceeds from sale of OSP, net of fees
8,463
—
Net cash used in investing activities
(10,612
)
(323
)
Cash flows provided by (used in) financing
activities:
Proceeds from issuance of long-term
debt
15,000
—
Borrowings on revolving credit
facility
4,326
4,000
Repayments of long-term debt
(526
)
(455
)
Repayments of revolving credit
facility
(10,238
)
—
Debt refinancing fees
(814
)
(1,216
)
Taxes paid for shares withheld
(75
)
(13
)
Net cash provided by financing
activities
7,673
2,316
Effect of exchange rate changes on cash
and cash equivalents
(106
)
46
Decrease in cash, cash equivalents, and
restricted cash
(2,259
)
(4,814
)
Cash, cash equivalents and restricted
cash:
Beginning of period
29,313
21,396
End of period
$
27,054
$
16,582
_______________________________________________________________________________
(1)
Changes in operating assets and
liabilities exclude assets and liabilities sold and assets and
liabilities acquired through business acquisitions.
REGIS CORPORATION
System-Wide Same-Store
Sales
SYSTEM-WIDE SAME-STORE SALES
(1):
Three Months Ended
December 31, 2024
December 31, 2023
Service
Retail
Total
Service
Retail
Total
Supercuts
1.0
%
(11.2
)%
0.5
%
3.0
%
(5.7
)%
2.6
%
SmartStyle
(4.0
)
(18.1
)
(6.4
)
(0.5
)
(10.8
)
(2.4
)
Portfolio Brands
(1.5
)
(13.0
)
(2.4
)
4.2
(1.5
)
3.7
Total
(0.6
)%
(14.7
)%
(1.6
)%
2.7
%
(6.7
)%
1.9
%
Six Months Ended
December 31, 2024
December 31, 2023
Service
Retail
Total
Service
Retail
Total
Supercuts
1.1
%
(10.3
)%
0.7
%
2.8
%
(5.2
)%
2.4
%
SmartStyle
(4.1
)
(18.2
)
(6.5
)
(0.7
)
(9.0
)
(2.2
)
Portfolio Brands
(0.9
)
(11.8
)
(1.7
)
4.2
(1.5
)
3.7
Total
(0.4
)%
(14.2
)%
(1.4
)%
2.5
%
(5.8
)%
1.8
%
_______________________________________________________________________________
(1)
System-wide same-store sales are
calculated as the total change in sales for system-wide franchise
and company-owned locations that were open on a specific day of the
week during the current period and the corresponding prior period.
Quarterly system-wide same-store sales are the sum of the
system-wide same-store sales computed on a daily basis. Franchise
salons that do not report daily sales are excluded from same-store
sales. System-wide same-store sales are calculated in local
currencies to remove foreign currency fluctuations from the
calculation.
REGIS CORPORATION
System-Wide Location
Counts
December 31,
2024
June 30, 2024
FRANCHISE SALONS:
Supercuts
1,772
1,946
SmartStyle/Cost Cutters in Walmart
Stores
1,190
1,232
Portfolio Brands
868
1,117
Total North American salons
3,830
4,295
Total International salons (1)
95
96
Total franchise salons
3,925
4,391
as a percent of total franchise and
company-owned salons
92.4
%
99.6
%
COMPANY-OWNED SALONS (2):
Supercuts
111
3
SmartStyle/Cost Cutters in Walmart
Stores
1
8
Portfolio Brands
211
6
Total company-owned salons
323
17
as a percent of total franchise and
company-owned salons
7.6
%
0.4
%
Total franchise and company-owned
salons
4,248
4,408
_______________________________________________________________________________
(1)
Canadian and Puerto Rican salons are
included in the North American salon totals.
(2)
Salon counts as of December 31, 2024,
include the 314 salons acquired as part of the Alline
acquisition.
Non-GAAP Reconciliations:
This press release includes a presentation of adjusted EBITDA
and adjusted franchise revenue, which are non-GAAP measures. The
non-GAAP measures are financial measures that do not reflect United
States Generally Accepted Accounting Principles (GAAP). We believe
our presentation of the non-GAAP measures provides meaningful
insight into our ongoing operating performance and a supplemental
perspective of our results of operations. Presentation of the
non-GAAP measures allows investors to review our core ongoing
operating performance from the same perspective as management and
the Board of Directors. These non-GAAP financial measures provide
investors an enhanced understanding of our operations, facilitate
investors’ analyses and comparisons of our current and past results
of operations and provide insight into the prospects of our future
performance. We also believe the non-GAAP measures are useful to
investors because they provide supplemental information that
research analysts frequently use to analyze financial
performance.
Items impacting comparability are not defined terms within U.S.
GAAP. Therefore, our non-GAAP financial information may not be
comparable to similarly titled measures reported by other
companies. We determine the items to consider as "items impacting
comparability" based on how management views our business, makes
financial, operating and planning decisions and evaluates the
Company's ongoing performance.
The following items have been excluded from our non-GAAP
adjusted EBITDA results: stock-based compensation expense,
discontinued operations, one-time professional fees and legal
settlements, severance expense, excess inventory impairment
charges, the benefit from lease liability decreases in excess of
previously impaired right of use asset, lease termination fees and
asset retirement obligation costs.
We present adjusted revenue to provide a meaningful franchise
adjusted EBITDA margin, which removes non-margin revenue from total
revenue to arrive at an adjusted margin. Margin is a common metric
used by investors, however, the majority of our revenue is offset
by equal expense, so it does not contribute to our margin. We
remove the non-margin revenue from this metric in order to show a
meaningful margin rate.
The method we use to produce non-GAAP results is not in
accordance with U.S. GAAP and may differ from methods used by other
companies. These non-GAAP results should not be regarded as a
substitute for corresponding U.S. GAAP measures, but instead should
be utilized as a supplemental measure of operating performance in
evaluating our business. Non-GAAP measures do have limitations as
they do not reflect certain items that may have a material impact
upon our reported financial results. As such, these non-GAAP
measures should be viewed in conjunction with our financial
statements prepared in accordance with U.S. GAAP.
REGIS CORPORATION
Reconciliation of U.S. GAAP
Net Income to Adjusted EBITDA
(Dollars in thousands)
(Unaudited)
Three Months Ended
December 31,
Six Months Ended
December 31,
2024
2023
2024
2023
Reported net income
$
7,645
$
997
$
6,792
$
2,191
Interest expense
4,848
6,188
9,694
12,376
Income tax expense (benefit)
136
(107
)
(89
)
(255
)
Depreciation and amortization
460
677
906
1,047
Long lived asset impairment
—
170
352
170
EBITDA
$
13,089
$
7,925
$
17,655
$
15,529
Stock-based compensation expense (1)
174
261
1,604
890
Gain on discontinued operations
(7,439
)
(2,000
)
(8,396
)
(2,000
)
Discrete items (2)
1,316
109
3,913
(32
)
Adjusted EBITDA, non-GAAP financial
measure
$
7,140
$
6,295
$
14,776
$
14,387
_______________________________________________________________________________
(1)
Beginning in first quarter fiscal year
2025, management made the determination to exclude stock-based
compensation expenses from the adjusted EBITDA calculation. This
change has been retroactively applied to all prior periods
presented accordingly.
(2)
Discrete items include one-time
professional fees and legal settlements, severance expense, the
benefit from lease liability decreases in excess of previously
impaired right of use asset, lease termination fees and asset
retirement obligation costs.
REGIS CORPORATION
Reconciliation of Reported
General and Administrative Expenses to General and Administrative
Expenses Used to Calculate Adjusted EBITDA
(Dollars in thousands)
(Unaudited)
Three Months Ended
December 31,
Six Months Ended
December 31,
2024
2023
2024
2023
Reported general and administrative
$
11,155
$
11,772
$
25,189
$
22,501
Discrete general and administrative
(1)
(1,354
)
(29
)
(3,962
)
(29
)
Stock-based compensation
(174
)
(261
)
(1,604
)
(890
)
Adjusted general and administrative
$
9,627
$
11,482
$
19,623
$
21,582
_______________________________________________________________________________
(1)
Discrete items include one-time
professional fees and legal settlements, severance expense, and
asset retirement obligation costs.
REGIS CORPORATION
Reconciliation of Reported Net
Income to Adjusted Net Income
(Dollars in thousands)
(Unaudited)
Three Months Ended
December 31,
Six Months Ended
December 31,
2024
2023
2024
2023
Net income
$
7,645
$
997
$
6,792
$
2,191
Stock-based compensation
174
261
1,604
890
Long lived asset impairment
—
170
352
170
Discontinued operations
(7,439
)
(2,000
)
(8,396
)
(2,000
)
Discrete items
1,347
155
3,966
10
Adjusted net income (loss)
$
1,727
$
(417
)
$
4,318
$
1,261
REGIS CORPORATION
Reconciliation of Reported
Earnings Per Share to Adjusted Earnings Per Share
(Unaudited)
Three Months Ended
December 31,
Six Months Ended
December 31,
2024
2023
2024
2023
Reported earnings per share
$
2.71
$
0.43
$
2.90
$
0.93
Adjustment to reconcile reported to
adjusted earnings per share
(2.10
)
(0.61
)
(1.90
)
(0.40
)
Impact of change in weighted average
shares (1)
—
—
0.51
—
Adjusted earnings per share
$
0.61
$
(0.18
)
$
1.51
$
0.53
_______________________________________________________________________________
(1)
Non-GAAP net income per share reflects the
weighted average shares associated with non-GAAP net income, which
includes the dilutive effect of common stock equivalents. The
earnings per share impact of the adjustments for the six months
ended December 31, 2024, included additional shares for common
stock equivalents of 0.5 million. The impact of the adjustments
described above result in the effect of the common stock
equivalents to be dilutive to the non-GAAP net income per
share.
REGIS CORPORATION
Reconciliation of Reported
Franchise Adjusted EBITDA as a Percent of GAAP Franchise
Revenue
to Franchise Adjusted EBITDA
as a Percent of Adjusted Franchise Revenue
(Dollars in thousands)
(Unaudited)
Three Months Ended
December 31,
Six Months Ended
December 31,
2024
2023
2024
2023
Franchise adjusted EBITDA
$
6,414
$
6,632
$
14,400
$
15,222
GAAP franchise revenue
43,269
49,274
88,544
100,710
Franchise adjusted EBITDA as a percent of
GAAP franchise revenue
14.8
%
13.5
%
16.3
%
15.1
%
Non-margin revenue adjustments:
Franchise rental income
$
(20,022
)
$
(24,087
)
$
(41,658
)
$
(48,754
)
Advertising fund contributions
(5,490
)
(6,808
)
(11,131
)
(14,034
)
Adjusted franchise revenue
$
17,757
$
18,379
$
35,755
$
37,922
Franchise adjusted EBITDA as a percent of
adjusted franchise revenue
36.1
%
36.1
%
40.3
%
40.1
%
REGIS CORPORATION
Reconciliation of Reported
Operating Income to Adjusted Operating Income
(Dollars in thousands)
(Unaudited)
Three Months Ended
December 31,
Six Months Ended
December 31,
2024
2023
2024
2023
Reported operating income
$
5,497
$
4,779
$
7,631
$
12,213
Discrete items
1,347
325
4,318
180
Stock-based compensation
174
261
1,604
890
Adjusted operating income
$
7,018
$
5,365
$
13,553
$
13,283
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250212744424/en/
REGIS CORPORATION: Kersten Zupfer
investorrelations@regiscorp.com
HAYDEN IR: James Carbonara James@haydenir.com (646) 755-7412
Brett Maas brett@haydenir.com (646) 536-7331
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