8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 26, 2005

REGIS CORPORATION

(Exact name of registrant as specified in its charter)

Minnesota	0-11230	41-0749934
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No)

7201 Metro Boulevard
Minneapolis, MN 55439
(Address of principal executive offices and zip code)

(952) 947-7000
(Registrant’s telephone number, including area code)

(Not applicable)
(Former name or former address, if changed from last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

1

TABLE OF CONTENTS

News Release

Regis Corporation
Current Report on Form 8-K

ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On January 26, 2005, Regis Corporation announced the financial results for its fiscal second quarter and six months ended December 31, 2004. A copy of the News Release issued by Regis Corporation in connection with this Item 2.02 is attached as Exhibit 99 and incorporated by reference herein.

The information in this Form 8-K shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, regardless of any general incorporation language in such filing.

ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.

(c) Exhibits.

EXHIBIT
NUMBER
99	Regis Corporation News Release dated January 26, 2005

2

SIGNATURE

     Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	REGIS CORPORATION
Dated: January 26, 2005	By:	/s/ Eric Bakken
		Name:	Eric Bakken, Title: Secretary

EXHIBIT INDEX

EXHIBIT
NUMBER
99	Regis Corporation News Release dated January 26, 2005

3

EX-99

EXHIBIT 99

	CONTACTS:
	Investors:	REGIS CORPORATION:
		Paul D. Finkelstein – Chairman & CEO
		Randy L. Pearce – Executive Vice President, CFO
		Kyle P. Didier – Vice President, Finance
		(952) 947-7000
For Immediate Release
	Media:	BERNS COMMUNICATIONS GROUP:
		Melissa Jaffin/Michael McMullan
		(212) 994-4660

REGIS REPORTS FISCAL SECOND QUARTER 2005 RESULTS
- -Second Quarter EPS of $0.58 In Line with Revised Guidance-

     MINNEAPOLIS, January 26, 2005 — Regis Corporation (NYSE:RGS), the global leader in the $150 billion hair care industry, today reported financial results for its fiscal second quarter ended December 31, 2004.

     Consolidated second quarter revenues increased 14 percent to a record $537 million compared to $472 million a year ago. Same-store sales increased 0.4 percent. Second quarter net income decreased three percent to $26.8 million, or $0.58 per diluted share.

     “We are obviously disappointed with our second quarter results,” commented Paul D. Finkelstein, chairman and chief executive officer. “Our second quarter earnings are heavily weighted in the month of December. Unfortunately, we experienced a significant drop-off in traffic during the final two weeks of this month. As a result, we were not able to meet our earnings objectives.”

     During the quarter, Regis Corporation added a net total of 256 locations. The Company constructed 124 salons and franchisees built 77 salons. During the quarter, the Company acquired 69 salons, including nine franchise buybacks, 91 hair restoration centers and four beauty schools. A total of 100 salons were closed or relocated during the quarter.

Fiscal Year 2005 Outlook

     “Our outlook for the remainder of fiscal year 2005 has not changed,” commented Mr. Finkelstein. “However, due to the reclassified income statement, we are providing detailed fiscal year guidance.”

The following points pertain to the fiscal year ending June 30, 2005:

•   Including anticipated acquisitions, earnings per diluted share are expected to increase to a range of $2.35 to $2.47, an increase of three to eight percent compared to last year.

•   Including anticipated salon acquisitions, consolidated revenue is forecasted to grow 14 percent to approximately $2.2 billion. Consolidated same-store sales are forecasted to increase approximately 1.0 percent.

•   Service margins are projected to be in the upper 43 percent range of service revenue.

•   Product margins are projected to be in the mid 47 percent range of product revenue.

•   Site operating expenses are projected to be in the low eight percent range of consolidated revenue.

•   General and administrative expense is projected to in the mid 11 percent range of consolidated revenue.

•   Rent expense is projected to be 14 percent of consolidated revenue.

•   Depreciation and amortization is projected to be four percent of consolidated revenue.

•   Operating income is projected to be in the high eight percent range of consolidated revenue.

•   Interest expense is projected to be approximately $25 million.

•   The effective income tax rate is projected to be 35 percent.

•   We plan to build 550 to 600 new corporate salons and we anticipate franchisees to build approximately 300 franchised salons, excluding salon closures.

•   Net of salon closures, relocations and franchise buybacks, we plan to add over 1,000 salons.

•   Excluding acquisitions, capital expenditures are projected to be $100 to $115 million, including $40 million for salon maintenance.

•   We anticipate spending $90 to $100 million to acquire up to 500 salons and up to an additional $60 million to acquire beauty schools.

•   Total debt could reach $610 million, with debt-to-capitalization projected to be in the low 40 percent range.

     Regis Corporation will broadcast its second quarter conference call live on the internet, Wednesday, January 26, 2005 at 10:00 a.m. Central Time. Interested parties are invited to listen by logging onto www.regiscorp.com. An archive of the conference call will be available at this website shortly after the conclusion of the live broadcast. Regis Corporation will release January 2005 revenue results, including same-store sales, on February 7, 2005.

     Regis Corporation (RGS) is the industry leader in three distinct, but related, hair service businesses; beauty salons, hair restoration centers and beauty schools. As of December 31, 2004, the Company owned or franchised 10,412 hair salons, 91 hair restoration centers and 15 beauty schools operating under concepts such as Supercuts, Jean Louis David, Vidal Sassoon, Regis Salons, MasterCuts, Trade Secret, SmartStyle, Cost Cutters and Hair Club for Men and Women. These concepts are located in the US and in ten other countries throughout North America and Europe. For additional information about the Company, including managements’ current financial outlook and a reconciliation of non-GAAP financial information, please visit the Investor Information section of the corporate website at www.regiscorp.com.

     This press release contains “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,” “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 competition within the personal hair care industry, which remains strong, both domestically and internationally, and price sensitivity; changes in economic condition; changes in consumer tastes and fashion trends; labor and benefit costs; legal claims; risk inherent to international development (including currency fluctuations); the continued ability of the Company and its

franchisees to obtain suitable locations for new salon development; governmental initiatives such as minimum wage rates, taxes and possible franchise legislation; the ability of the Company to successfully identify and acquire salons and beauty schools that support its growth objectives; or other factors not listed above. The ability of the Company to meet its expected revenue growth is dependent on salon acquisitions, new salon construction and same-store sales increases, all of which are affected by many of the aforementioned risks. Additional information concerning potential factors that could affect future financial results is set forth in the Company’s Annual Report on Form 10-K for the year ended June 30, 2004 and included in Form S-3 Registration Statement filed with the Securities and Exchange Commission on June 4, 2004. 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.

# # #

(TABLES TO FOLLOW)

REGIS CORPORATION (NYSE:RGS)
CONSOLIDATED BALANCE SHEET (Unaudited)
as of December 31, 2004 and June 30, 2004
(Dollars in thousands, except per share amounts)

	December 31,		June 30,
	2004		2004
ASSETS
Current assets:
Cash and cash equivalents	$	118,333	$	73,567
Receivables, net		45,771		35,033
Inventories		173,652		161,304
Deferred income taxes		14,373		15,285
Other current assets		28,370		28,253
Total current assets		380,499		313,442
Property and equipment, net		411,644		381,903
Goodwill		625,586		457,140
Other intangibles, net		210,751		79,174
Other assets		52,085		40,200
Total assets	$	1,680,565	$	1,271,859
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Long-term debt, current portion	$	6,368	$	19,128
Accounts payable		66,225		53,112
Accrued expenses		159,921		129,721
Total current liabilities		232,514		201,961
Long-term debt		513,295		282,015
Other noncurrent liabilities		164,828		100,322
Total liabilities		910,637		584,298
Shareholders’ equity:
Preferred stock, authorized 250,000 shares at December 31, 2004 and June 30, 2004
Common stock, $.05 par value; issued and outstanding, 44,661,488 and 44,283,949 common shares at December 31, 2004 and June 30, 2004, respectively		2,228		2,214
Additional paid-in capital		230,550		220,204
Accumulated other comprehensive income		62,502		40,642
Retained earnings		474,648		424,501
Total shareholders’ equity		769,928		687,561
Total liabilities and shareholders’ equity	$	1,680,565	$	1,271,859

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REGIS CORPORATION (NYSE:RGS)
CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
(Dollars in thousands, except per share amounts)

	Three Months Ended						Six Months Ended
	December 31,						December 31,
	2004			2003			2004			2003
Revenues:
Service	$	357,147		$	306,630		$	696,582		$	609,582
Product		160,249			147,442			308,368			287,102
Royalties and fees		19,936			18,380			38,604			36,489
		537,332			472,452			1,043,554			933,173
Operating expenses:
Cost of service		203,604			171,452			396,190			341,853
Cost of product		84,392			76,902			161,976			151,215
Site operating expenses		44,751			39,154			88,052			77,701
General and administrative		64,105			54,429			121,806			107,873
Rent		74,670			64,759			146,719			127,818
Depreciation and amortization		20,765			18,673			40,560			36,299
Total operating expenses		492,287			425,369			955,303			842,759
Operating income		45,045			47,083			88,251			90,414
Other income (expense):
Interest		(5,467	)		(3,851	)		(9,775	)		(8,219	)
Other, net		1,024			331			1,701			671
Income before income taxes		40,602			43,563			80,177			82,866
Income taxes		(13,838	)		(15,901	)		(27,934	)		(30,246	)
Net income	$	26,764		$	27,662		$	52,243		$	52,620
Net income per share:
Basic	$	0.60		$	0.63		$	1.18		$	1.20
Diluted	$	0.58		$	0.60		$	1.13		$	1.15
Weighted average common and common equivalent shares outstanding:
Basic		44,534			43,893			44,423			43,795
Diluted		46,468			45,973			46,359			45,835
Cash dividends declared per common share	$	0.04		$	0.03		$	0.08		$	0.06

A historical model of Regis Corporation’s quarterly results in this format is available in the Investor Information section of the corporate website at www.regiscorp.com. Click on “Financial Reports”.

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REGIS CORPORATION (NYSE:RGS)
CONSOLIDATED STATEMENT OF CASH FLOWS
(Dollars in thousands)

	Six Months Ended December 31,
	2004			2003
Cash flows from operating activities:
Net income	$	52,243		$	52,620
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		38,137			34,888
Amortization		2,423			1,724
Deferred income taxes		4,462			5,901
Other		595			179
Changes in operating assets and liabilities*:
Receivables		(1,265	)		(2,408	)
Inventories		(8,407	)		4,883
Other current assets		1,546			(1,950	)
Other assets		(6,836	)		(2,870	)
Accounts payable		7,221			881
Accrued expenses		15,075			14,057
Other noncurrent liabilities		7,341			5,826
Net cash provided by operating activities		112,535			113,731
Cash flows from investing activities:
Capital expenditures		(46,709	)		(34,404	)
Proceeds from sale of assets		602			95
Business and salon acquisitions, net of cash acquired		(244,743	)		(33,611	)
Net cash used in investing activities		(290,850	)		(67,920	)
Cash flows from financing activities:
Borrowings on revolving credit facilities		890,315			385,175
Payments on revolving credit facilities		(760,633	)		(396,150	)
Proceeds from issuance of long-term debt		100,000			11,860
Repayments of long-term debt		(17,226	)		(20,110	)
Other, primarily increase (decrease) in negative book cash balances		2,672			(8,838	)
Dividends paid		(3,555	)		(2,631	)
Repurchase of common stock		(442	)		(3,373	)
Proceeds from issuance of common stock		6,425			10,390
Net cash provided by (used in) financing activities		217,556			(23,677	)
Effect of exchange rate changes on cash and cash equivalents		5,525			3,568
Increase in cash and cash equivalents		44,766			25,702
Cash and cash equivalents:
Beginning of period		73,567			55,454
End of period	$	118,333		$	81,156

* Changes in operating assets and liabilities do not include assets and liabilities assumed through acquisitions.

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REGIS CORPORATION (NYSE:RGS)
Salon / School/ Hair Restoration Center Counts and Revenues

	December 31,		June 30,
	2004		2004
SYSTEM-WIDE LOCATIONS:
Company-owned salons		6,488		6,227
Franchise salons		3,924		3,924
Beauty career schools		15		11
Company-owned hair restoration centers		42		—
Franchise hair restoration centers		49		—
		10,518		10,162

SALON LOCATION SUMMARY

	December 31,			June 30,
	2004			2004
NORTH AMERICAN SALONS:
REGIS SALONS
Open at beginning of period		1,085			1,095
Salons constructed		21			33
Acquired		—			4
Less relocations		10			10
Salon openings		11			27
Conversions		—			(2	)
Salons closed		(14	)		(35	)
Total, Regis Salons		1,082			1,085
MASTERCUTS
Open at beginning of period		604			590
Salons constructed		25			34
Acquired		—			3
Less relocations		7			9
Salon openings		18			28
Conversions		—			1
Salons closed		(2	)		(15	)
Total, Mastercuts		620			604

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	December 31,			June 30,
	2004			2004
TRADE SECRET
Company-owned salons:
Open at beginning of period		549			517
Salons constructed		30			26
Acquired		7			12
Franchise buybacks		—			2
Less relocations		9			5
Salon openings		28			35
Conversions		—			1
Salons closed		(5	)		(4	)
Total company-owned salons		572			549
Franchise salons:
Open at beginning of period		24			25
Salons constructed		—			1
Acquired		—			—
Salon openings		—			1
Franchise buybacks		—			(2	)
Salons closed		—			—
Total franchise salons		24			24
Total, Trade Secret		596			573
SMARTSTYLE/COST CUTTERS IN WAL-MART
Company-owned salons:
Open at beginning of period		1,263			1,033
Salons constructed		80			174
Acquired		—			—
Franchise buybacks		7			61
Less relocations		—			—
Salon openings		87			235
Conversions		—			—
Salons closed		(2	)		(5	)
Total company-owned salons		1,348			1,263
Franchise salons:
Open at beginning of period		201			230
Salons constructed		13			33
Acquired		—			—
Less relocations		—			—
Salon openings		13			33
Conversions		—			—
Franchise buybacks		(7	)		(61	)
Salons closed		—			(1	)
Total franchise salons		207			201
Total, SmartStyle/Cost Cutters in Wal-Mart		1,555			1,464

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	December 31,			June 30,
	2004			2004
STRIP CENTERS
Company-owned salons:
Open at beginning of period		2,310			1,928
Salons constructed		68			166
Acquired		51			162
Franchise buybacks		60			133
Less relocations		12			8
Salon openings		167			453
Conversions		(3	)		(8	)
Salons closed		(39	)		(63	)
Total company-owned salons		2,435			2,310
Franchise salons:
Open at beginning of period		2,105			2,172
Salons constructed		77			146
Acquired (2)		—			—
Less relocations		5			10
Salon openings		72			136
Conversions		4			8
Franchise buybacks		(60	)		(133	)
Salons closed		(28	)		(78	)
Total franchise salons		2,093			2,105
Total, Strip Centers		4,528			4,415
INTERNATIONAL SALONS (1)
Company-owned salons:
Open at beginning of period		416			395
Salons constructed		21			19
Acquired		9			18
Franchise buybacks		—			10
Salon openings		30			47
Conversions		—			—
Salons closed		(15	)		(26	)
Total company-owned salons		431			416
Franchise salons:
Open at beginning of period		1,594			1,627
Salons constructed		51			88
Acquired (2)		—			—
Salon openings		51			88
Conversions		(1	)		—
Franchise buybacks		—			(10	)
Salons closed		(44	)		(111	)
Total franchise salons		1,600			1,594
Total international salons		2,031			2,010

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	December 31,			June 30,
	2004			2004
TOTAL SYSTEM-WIDE LOCATIONS
Company-owned salons:
Open at beginning of period		6,227			5,558
Salons constructed		245			452
Acquired		67			199
Franchise buybacks		67			206
Less relocations		38			32
Salon openings		341			825
Conversions		(3	)		(8	)
Salons closed		(77	)		(148	)
Total company-owned salons		6,488			6,227
Franchise salons:
Open at beginning of period		3,924			4,054
Salons constructed		141			268
Acquired (2)		—			—
Less relocations		5			10
Salon openings		136			258
Conversions		3			8
Franchise buybacks		(67	)		(206	)
Salons closed		(72	)		(190	)
Total franchise salons		3,924			3,924
Beauty career schools:
Open at beginning of period		11			5
Acquired		4			6
Salon openings		4			6
Total beauty career schools		15			11
Company-owned hair restoration centers:
Acquired		42			—
Salon openings		42			—
Total company-owned hair restoration centers		42			—
Franchise hair restoration centers:
Acquired		49			—
Salon openings		49			—
Total franchise hair restoration centers		49			—
Grand total, system-wide		10,518			10,162

(1)	Canadian and Puerto Rican salons are included in the Regis Salons, Strip Center, MasterCuts and Trade Secret concepts and not included in the International salon totals.
(2)	Represents primarily the acquisition of franchise networks.

Relocations represent a transfer of location by the same salon concept.

Conversions represent the transfer of one salon concept to another concept.

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			(Dollars in thousands)
	Three Months Ended				Six Months Ended
	December 31,				December 31,
	2004		2003		2004		2003
Revenues:
North American Salons:
Regis Salons	$	118,870	$	118,731	$	235,327	$	236,686
MasterCuts		44,003		43,671		86,522		87,217
Trade Secret		69,131		65,051		130,592		123,992
SmartStyle		84,400		69,964		166,683		138,411
Strip Centers		148,914		123,521		294,622		249,165
International salons		55,597		47,810		107,335		90,952
Beauty career schools		8,032		3,704		14,088		6,750
Hair restoration centers		8,385		—		8,385		—
	$	537,332	$	472,452	$	1,043,554	$	933,173

Included in the table above are franchise royalties and fees of $19,936 and $18,380 for the three months ended December 31, 2004 and 2003, respectively, and $38,604 and $36,489 for the six months ended December 31, 2004 and 2003, respectively.

Financial information concerning the Company’s salon, school and hair restoration businesses is shown in the following tables. A historical model of Regis Corporation’s quarterly results in this format is available in the Investor Information section of the corporate website at www.regiscorp.com. Click on “Financial Reports”.

	For the Three Months Ended December 31, 2004
			Beauty Career		Hair Restoration		Unallocated
(Dollars in thousands)	Salons		Schools		Centers		Corporate			Consolidated
Revenues:
Service	$	343,290	$	7,597	$	6,260	$	—		$	357,147
Product		158,317		435		1,497		—			160,249
Royalties and fees		19,308		—		628		—			19,936
		520,915		8,032		8,385		—			537,332
Operating expenses:
Cost of service		198,945		2,143		2,516		—			203,604
Cost of product		83,241		363		788		—			84,392
Site operating expenses		43,474		797		480		—			44,751
General and administrative		35,706		1,471		1,818		25,110			64,105
Rent		73,448		617		510		95			74,670
Depreciation and amortization		17,224		233		708		2,600			20,765
Total operating expenses		452,038		5,624		6,820		27,805			492,287
Operating income		68,877		2,408		1,565		(27,805	)		45,045
Other income (expense):
Interest		—		—		—		(5,467	)		(5,467	)
Other, net		—		—		—		1,024			1,024
Income before income taxes	$	68,877	$	2,408	$	1,565	$	(32,248	)	$	40,602

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	For the Three Months Ended December 31, 2003
			Beauty Career		Hair Restoration		Unallocated
(Dollars in thousands)	Salons		Schools		Centers		Corporate			Consolidated
Revenues:
Service	$	303,084	$	3,546	$	—	$	—		$	306,630
Product		147,284		158		—		—			147,442
Royalties and fees		18,380		—		—		—			18,380
		468,748		3,704		—		—			472,452
Operating expenses:
Cost of service		170,369		1,083		—		—			171,452
Cost of product		76,804		98		—		—			76,902
Site operating expenses		38,656		498		—		—			39,154
General and administrative		31,928		315		—		22,186			54,429
Rent		64,407		255		—		97			64,759
Depreciation and amortization		16,350		59		—		2,264			18,673
Total operating expenses		398,514		2,308		—		24,547			425,369
Operating income		70,234		1,396		—		(24,547	)		47,083
Other income (expense):
Interest		—		—		—		(3,851	)		(3,851	)
Other, net		—		—		—		331			331
Income before income taxes	$	70,234	$	1,396	$	—	$	(28,067	)	$	43,563

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