SEGMENT INFORMATION:

Segment information is prepared on the same basis that the chief operating decision maker reviews financial information for operational decision-making purposes.

The Company’s reportable operating segments consisted of the following salons:



	March 31, 2019		June 30, 2018
COMPANY-OWNED SALONS:

SmartStyle/Cost Cutters in Walmart Stores	1,591		1,660
Supercuts	568		928
Signature Style	1,217		1,378
Total Company-owned Salons	3,376		3,966
as a percent of total Company-owned and Franchise salons	43.6	%	49.1	%

FRANCHISE SALONS:

SmartStyle/Cost Cutters in Walmart Stores	591		561
Supercuts	2,164		1,739
Signature Style	740		745
Total franchise locations, excluding TBG mall locations	3,495		3,045
as a percent of total Company-owned and Franchise salons	45.1	%	37.7	%

Total North America TBG mall locations (1)	617		807
as a percent of total Company-owned and Franchise salons	8.0	%	10.0	%

Total North American Salons	4,112		3,852

Total International TBG Salons (1)	263		262
as a percent of total Company-owned and Franchise salons	3.4	%	3.2	%

Total Franchise Salons	4,375		4,114
as a percent of total Company-owned and Franchise salons	56.4	%	50.9	%

OWNERSHIP INTEREST LOCATIONS:

Equity ownership interest locations	87		88

Grand Total, System-wide	7,838		8,168

____________________________________


(1)	Canadian and Puerto Rican salons are included in the North American salon totals.

As of March 31, 2019, the Company-owned operating segment is comprised primarily of SmartStyle^®, Supercuts^®, Cost Cutters^®, and other regional trade names and the Franchise operating segment is comprised primarily of Supercuts^®, Regis^®, MasterCuts^®, SmartStyle^®, Cost Cutters^®, First Choice Haircutters^®, Roosters^® and Magicuts^® concepts.

Financial information concerning the Company's reportable operating segments is shown in the following table:



	For the Three Months Ended March 31, 2019
	Company-owned		Franchise			Corporate			Consolidated
	(Dollars in thousands)
Revenues:
Service	$	181,809	$	—		$	—		$	181,809
Product	39,427		14,339			—			53,766
Royalties and fees	—		22,768			—			22,768
	221,236		37,107			—			258,343
Operating expenses:
Cost of service	111,632		—			—			111,632
Cost of product	19,992		11,175			—			31,167
Site operating expenses	25,894		8,445			—			34,339
General and administrative	14,505		7,526			19,663			41,694
Rent	31,964		190			178			32,332
Depreciation and amortization	6,519		240			1,871			8,630
TBG mall location restructuring	—		20,711			—			20,711
Total operating expenses	210,506		48,287			21,712			280,505
Operating income (loss)	10,730		(11,180		)	(21,712		)	(22,162		)
Other (expense) income:
Interest expense	—		—			(1,354		)	(1,354		)
Gain from sale of salon assets to franchisees, net	—		—			11,489			11,489
Interest income and other, net	—		—			464			464
Income (loss) from continuing operations before income taxes	$	10,730	$	(11,180	)	$	(11,113	)	$	(11,563	)



	For the Three Months Ended March 31, 2018
	Company-owned		Franchise		Corporate			Consolidated
	(Dollars in thousands)
Revenues:
Service	$	222,022	$	—	$	—		$	222,022
Product	49,980		14,931		—			64,911
Royalties and fees	—		18,850		—			18,850
	272,002		33,781		—			305,783
Operating expenses:
Cost of service	132,081		—		—			132,081
Cost of product	25,137		12,002		—			37,139
Site operating expenses	31,022		6,526		—			37,548
General and administrative	18,051		6,590		21,086			45,727
Rent	39,094		51		246			39,391
Depreciation and amortization	7,276		92		2,190			9,558
TBG mall location restructuring	—		—		—			—
Total operating expenses	252,661		25,261		23,522			301,444
Operating income (loss)	19,341		8,520		(23,522		)	4,339
Other (expense) income:
Interest expense	—		—		(5,095		)	(5,095		)
Gain from sale of salon assets to franchisees, net	—		—		237			237
Interest income and other, net	—		—		1,495			1,495
Income (loss) from continuing operations before income taxes	$	19,341	$	8,520	$	(26,885	)	$	976



	For the Nine Months Ended March 31, 2019
	Company-owned		Franchise		Corporate			Consolidated
	(Dollars in thousands)
Revenues:
Service	$	580,076	$	—	$	—		$	580,076
Product	125,220		47,786		—			173,006
Royalties and fees	—		67,767		—			67,767
	705,296		115,553		—			820,849
Operating expenses:
Cost of service	348,060		—		—			348,060
Cost of product	61,661		38,037		—			99,698
Site operating expenses	82,435		24,288		—			106,723
General and administrative	45,084		24,656		65,517			135,257
Rent	101,908		468		576			102,952
Depreciation and amortization	21,304		613		5,815			27,732
TBG mall location restructuring	—		20,711		—			20,711
Total operating expenses	660,452		108,773		71,908			841,133
Operating income (loss)	44,844		6,780		(71,908		)	(20,284		)
Other (expense) income:
Interest expense	—		—		(3,432		)	(3,432		)
Gain from sale of salon assets to franchisees, net	—		—		10,394			10,394
Interest income and other, net	—		—		1,453			1,453
Income (loss) from continuing operations before income taxes	$	44,844	$	6,780	$	(63,493	)	$	(11,869	)



	For the Nine Months Ended March 31, 2018
	Company-owned		Franchise		Corporate			Consolidated
	(Dollars in thousands)
Revenues:
Service	$	680,930	$	—	$	—		$	680,930
Product	159,980		37,721		—			197,701
Royalties and fees	—		56,465		—			56,465
	840,910		94,186		—			935,096
Operating expenses:
Cost of service	406,767		—		—			406,767
Cost of product	77,628		29,537		—			107,165
Site operating expenses	96,443		19,732		—			116,175
General and administrative	51,822		19,005		58,658			129,485
Rent	146,376		168		736			147,280
Depreciation and amortization	39,224		275		7,265			46,764
TBG mall location restructuring	—		—		—			—
Total operating expenses	818,260		68,717		66,659			953,636
Operating income (loss)	22,650		25,469		(66,659		)	(18,540		)
Other (expense) income:
Interest expense	—		—		(9,402		)	(9,402		)
Gain from sale of salon assets to franchisees, net	—		—		255			255
Interest income and other, net	—		—		3,934			3,934
Income (loss) from continuing operations before income taxes	$	22,650	$	25,469	$	(71,872	)	$	(23,753	)