EX-99 2 a07-27122_1ex99.htm EX-99

 

Exhibit 99

 

CONTACT:

 

REGIS CORPORATION:

 

 

Mark Fosland — Vice President, Finance

 

 

952-806-1707

 

 

Alex Forliti — Director, Finance-Investor Relations

 

 

952-806-1767

 

For Immediate Release

 

REGIS REPORTS FIRST QUARTER 2008 RESULTS

-EPS of $0.46 meets mid-point of previously issued guidance-

-Annual earnings guidance reaffirmed-

 

MINNEAPOLIS, October 22, 2007 — Regis Corporation (NYSE:RGS), the global leader in the $170 billion hair care industry, today reported financial results for its fiscal first quarter ending September 30, 2007.  Net income for the quarter was $20.6 million, or $0.46 per diluted share, which came in at the mid-point of the Company’s previously issued guidance of $0.43 to $0.49 per share.

 

On October 10, 2007, the Company reported revenues for the first quarter ended September 30, 2007 increased four percent to $668 million versus $639 million in first quarter of fiscal 2007. Consolidated same-store sales increased 0.9 percent for the quarter, including an increase in service same-store sales of 2.3 percent, versus an overall decrease of 0.3 percent during the comparable quarter a year ago.

 

“We are very encouraged by our first quarter same-store service sales increase of 2.3 percent.  Over the last nine months, we have seen many positive signs that the long hair fashion cycle is turning and if these trends continue, we would expect our same-store service sales to return to historical levels,” commented Paul D. Finkelstein, Chairman and Chief Executive Officer.

 

During the quarter, Regis added a net total of 81 locations. The Company constructed 85 locations and franchisees built an additional 57 units. In addition, Regis acquired 91 corporate salons (including 59 franchise buybacks) and 42 franchised salons.  The Company closed or relocated 84 corporate and franchise locations during the quarter.  In addition, the Company merged its 51 accredited beauty schools with Empire Education Group on August 1, 2007.

 

Second Quarter Fiscal 2008 Outlook

 

The following outlook pertains to the second quarter ending December 31, 2007:

 

•

Consolidated revenue is forecasted to grow five to seven percent to a range of $690 million to $700 million compared to $657 million a year ago. (Note: The deconsolidation of the beauty schools reduces revenue growth by 2 percent in the quarter.)

 

•

Consolidated same-store sales are forecasted to be in a range of 0.5 to 2.5 percent.

 

•

The effective income tax rate is expected to be approximately 36 percent, which reflects the adoption of FIN 48.

 

•

Earnings per diluted share are forecasted to be in the range of $0.51 to $0.57.

 


 

Fiscal Year 2008 Updated Outlook

 

The following points pertain to the fiscal year ending June 30, 2008:

 

•

Consolidated revenue is forecasted to grow four to six percent to approximately $2.75 billion.   (Note:  The deconsolidation of the beauty schools reduces revenue growth by 2 percent in Fiscal 2008.)

 

•

Consolidated same-store sales are forecasted to be in a range of 0.5 to 2.5 percent.

 

•

Effective income tax rate is expected to be approximately 34 percent.

 

•

Consistent with previously issued guidance, earnings per diluted share are forecasted to be in a range of $2.01 to $2.27.

 

Regis Corporation will host a conference call discussing second quarter results today, October 22, 2007 at 10:00 a.m., Central Time. Interested parties are invited to listen by logging on to www.regiscorp.com or dialing 800-218-4007. A replay of the call will be available later that day. The replay phone number is 800-405-2236, access code 11097199#.

 

About Regis Corporation

Regis Corporation (NYSE:RGS) is the beauty industry’s global leader in beauty salons, hair restoration centers and cosmetology education. As of September 30, 2007, the Company owned, franchised or held ownership interests in over 12,500 worldwide locations.  Regis’ corporate and franchised locations operate 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.  In addition, Regis maintains ownership interests in Empire Education Group and various other salon concepts such as Cool Cuts 4 Kids, and the Beauty Takashi and Beauty Plaza concepts in Japan.  System-wide, these and other concepts are located in the U.S. and in eleven other countries in North America, Europe and Asia. Regis also maintains a 50 percent ownership interest in Intelligent Nutrients, a joint venture that provides a wide variety of certified organic products for health and beauty.  For additional information about the company, including management’s 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. To join Regis Corporation’s email alert list, click on this link:  http://www.b2i.us/irpass.asp?BzID=913&to=ea&Nav=1&S=0&L=1

 

         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; price sensitivity; changes in economic conditions; 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, acquire and integrate salons that support its growth objectives; the ability of the Company to maintain satisfactory relationships with suppliers; 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, 2007. 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)
CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)
as of September 30, 2007 and June 30, 2007
(In thousands, except share data)

 

 

September 30, 2007

 

June 30, 2007

 

ASSETS

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

145,229

 

$

184,785

 

Receivables, net

 

48,492

 

67,773

 

Inventories

 

213,860

 

196,582

 

Deferred income taxes

 

10,607

 

18,775

 

Other current assets

 

69,020

 

57,149

 

Total current assets

 

487,208

 

525,064

 

 

 

 

 

 

 

Property and equipment, net

 

485,086

 

494,085

 

Goodwill

 

814,869

 

812,383

 

Other intangibles, net

 

188,206

 

213,452

 

Investment in affiliates

 

95,174

 

20,213

 

Other assets

 

95,214

 

66,917

 

 

 

 

 

 

 

Total assets

 

$

2,165,757

 

$

2,132,114

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Long-term debt, current portion

 

$

188,863

 

$

223,352

 

Accounts payable

 

81,271

 

74,532

 

Accrued expenses

 

211,900

 

240,748

 

Total current liabilities

 

482,034

 

538,632

 

 

 

 

 

 

 

Long-term debt

 

529,807

 

485,879

 

Other noncurrent liabilities

 

213,444

 

194,295

 

Total liabilities

 

1,225,285

 

1,218,806

 

 

 

 

 

 

 

Shareholders’ equity:

 

 

 

 

 

Common stock, $0.05 par value; issued and outstanding 44,175,959 and 44,164,645 common shares at September 30, 2007 and June 30, 2007, respectively

 

2,209

 

2,209

 

Additional paid-in capital

 

180,170

 

178,029

 

Accumulated other comprehensive income

 

88,732

 

78,278

 

Retained earnings

 

669,361

 

654,792

 

 

 

 

 

 

 

Total shareholders’ equity

 

940,472

 

913,308

 

 

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

2,165,757

 

$

2,132,114

 

 

-more-


 

REGIS CORPORATION (NYSE: RGS)

CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)

 (In thousands, except per share data)

 

 

 

Three Months Ended
September 30,

 

 

 

2007

 

2006

 

Revenues:

 

 

 

 

 

Service

 

$

459,718

 

$

434,552

 

Product

 

186,782

 

184,925

 

Royalties and fees

 

21,025

 

19,766

 

 

 

667,525

 

639,243

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

Cost of service

 

263,060

 

245,525

 

Cost of product

 

94,077

 

94,229

 

Site operating expenses

 

53,685

 

55,806

 

General and administrative

 

86,352

 

77,953

 

Rent

 

97,763

 

92,172

 

Depreciation and amortization

 

31,582

 

29,542

 

Total operating expenses

 

626,519

 

595,227

 

 

 

 

 

 

 

Operating income

 

41,006

 

44,016

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

Interest

 

(10,578

)

(9,838

)

Other, net

 

2,155

 

811

 

 

 

 

 

 

 

Income before income taxes and equity in income (loss) of affiliated companies

 

32,583

 

34,989

 

 

 

 

 

 

 

Income taxes

 

(11,650

)

(11,896

)

Equity in income (loss) of affiliated companies, net of income taxes

 

(334

)

—

 

 

 

 

 

 

 

Net income

 

$

20,599

 

$

23,093

 

 

 

 

 

 

 

Net income per share:

 

 

 

 

 

Basic

 

$

0.47

 

$

0.51

 

Diluted

 

$

0.46

 

$

0.50

 

 

 

 

 

 

 

Weighted average common and common equivalent shares outstanding:

 

 

 

 

 

Basic

 

43,906

 

45,044

 

Diluted

 

44,579

 

46,132

 

 

 

 

 

 

 

Cash dividends declared per common share

 

$

0.04

 

$

0.04

 

 

-more-

 

 

 

 


 

REGIS CORPORATION (NYSE: RGS)
SELECTED CASH FLOW DATA
(In thousands)

 

 

 

Three Months Ended
September 30,

 

 

 

2007

 

2006

 

 

 

 

 

 

 

Net cash provided by operating activities

 

$

24,574

 

$

31,570

 

Net cash used in investing activities

 

(79,608

)

(62,725

)

Net cash provided by financing activities

 

10,198

 

41,655

 

Effect of exchange rate changes on cash and cash equivalents

 

5,280

 

963

 

(Decrease) increase in cash and cash equivalents

 

(39,556

)

11,463

 

 

 

 

 

 

 

Cash and cash equivalents:

 

 

 

 

 

Beginning of year

 

184,785

 

135,397

 

End of year

 

$

145,229

 

$

146,860

 

 

 

-more-

 


 

 REGIS CORPORATION (NYSE: RGS)

Salon / School / Hair Restoration Center Counts and Revenues

 

SYSTEM-WIDE LOCATIONS:

 

September 30, 2007

 

June 30, 2007

 

 

 

 

 

 

 

Company-owned salons

 

8,265

 

8,139

 

Franchise salons

 

3,753

 

3,742

 

Beauty career schools

 

—

 

56

 

Company-owned hair restoration centers

 

50

 

49

 

Franchise hair restoration centers

 

40

 

41

 

Ownership interest locations

 

476

 

389

 

Total, system-wide

 

12,584

 

12,416

 

 

SALON LOCATION SUMMARY

 

NORTH AMERICAN SALONS:

 

September 30, 2007

 

June 30, 2007

 

REGIS SALONS

 

 

 

 

 

Open at beginning of period

 

1,099

 

1,079

 

Salons constructed

 

5

 

17

 

Acquired

 

—

 

49

 

Less relocations

 

(5

)

(14

)

Salon openings

 

—

 

52

 

Conversions

 

1

 

(1

)

Salons closed

 

(5

)

(31

)

Total, Regis Salons

 

1,095

 

1,099

 

 

MASTERCUTS

 

 

 

 

 

Open at beginning of period

 

629

 

642

 

Salons constructed

 

3

 

15

 

Acquired

 

—

 

—

 

Less relocations

 

(2

)

(12

)

Salon openings

 

1

 

3

 

Conversions

 

—

 

—

 

Salons closed

 

(3

)

(16

)

Total, MasterCuts Salons

 

627

 

629

 

 

TRADE SECRET

 

 

 

 

 

Company-owned salons:

 

 

 

 

 

Open at beginning of period

 

613

 

615

 

Salons constructed

 

4

 

20

 

Acquired

 

2

 

3

 

Franchise buybacks

 

3

 

—

 

Less relocations

 

(3

)

(11

)

Salon openings

 

6

 

12

 

Conversions

 

—

 

1

 

Salons closed

 

(5

)

(15

)

Total company-owned salons

 

614

 

613

 

 

 

- more -

 


 

 

 

 

September 30, 2007

 

June 30, 2007

 

 

 

 

 

 

 

Franchise salons:

 

 

 

 

 

Open at beginning of period

 

19

 

19

 

Salons constructed

 

1

 

—

 

Acquired

 

42

 

—

 

Less relocations

 

(1

)

—

 

Salon openings

 

42

 

—

 

Franchise buybacks

 

(3

)

—

 

Salons closed

 

—

 

—

 

Total franchise salons

 

58

 

19

 

 

 

 

 

 

 

Total, Trade Secret Salons

 

672

 

632

 

 

SMARTSTYLE/COST CUTTERS IN WAL-MART

 

 

 

 

 

Company-owned salons:

 

 

 

 

 

Open at beginning of period

 

2,000

 

1,739

 

Salons constructed

 

46

 

242

 

Acquired

 

—

 

—

 

Franchise buybacks

 

12

 

21

 

Less relocations

 

(1

)

(2

)

Salon openings

 

57

 

261

 

Conversions

 

—

 

—

 

Salons closed

 

—

 

—

 

Total company-owned salons

 

2,057

 

2,000

 

 

Franchise salons:

 

 

 

 

 

Open at beginning of period

 

151

 

164

 

Salons constructed

 

1

 

8

 

Acquired

 

—

 

—

 

Less relocations

 

—

 

—

 

Salon openings

 

1

 

8

 

Conversions

 

—

 

—

 

Franchise buybacks

 

(12

)

(21

)

Salons closed

 

—

 

—

 

Total franchise salons

 

140

 

151

 

 

 

 

 

 

 

Total, SmartStyle/Cost Cutters in Wal-Mart Salons

 

2,197

 

2,151

 

 

 

 

September 30, 2007

 

June 30, 2007

 

STRIP CENTERS

 

 

 

 

 

Company-owned salons:

 

 

 

 

 

Open at beginning of period

 

3,317

 

3,031

 

Salons constructed

 

23

 

101

 

Acquired

 

5

 

193

 

Franchise buybacks

 

43

 

72

 

Less relocations

 

(4

)

(17

)

Salon openings

 

67

 

349

 

Conversions

 

—

 

—

 

Salons closed

 

(23

)

(63

)

Total company-owned salons

 

3,361

 

3,317

 

 

- more -

 


 

 

Franchise salons:

 

 

 

 

 

Open at beginning of period

 

1,998

 

2,004

 

Salons constructed

 

30

 

135

 

Acquired (2)

 

—

 

—

 

Less relocations

 

(2

)

(19

)

Salon openings

 

28

 

116

 

Conversions

 

—

 

—

 

Franchise buybacks

 

(43

)

(72

)

Salons closed

 

(12

)

(50

)

Total franchise salons

 

1,971

 

1,998

 

 

 

 

 

 

 

Total, Strip Center Salons

 

5,332

 

5,315

 

 

INTERNATIONAL SALONS (1)

 

 

 

 

 

Company-owned salons:

 

 

 

 

 

Open at beginning of period

 

481

 

453

 

Salons constructed

 

4

 

25

 

Acquired

 

25

 

12

 

Franchise buybacks

 

—

 

4

 

Less relocations

 

—

 

(3

)

Salon openings

 

29

 

38

 

Conversions

 

4

 

—

 

Salons closed

 

(3

)

(10

)

Total company-owned salons

 

511

 

481

 

 

Franchise salons:

 

 

 

 

 

Open at beginning of period

 

1,574

 

1,587

 

Salons constructed

 

23

 

110

 

Acquired (2)

 

—

 

—

 

Less relocations

 

—

 

(1

)

Salon openings

 

23

 

109

 

Conversions

 

—

 

—

 

Franchise buybacks

 

—

 

(4

)

Salons closed

 

(13

)

(118

)

Total franchise salons

 

1,584

 

1,574

 

 

 

 

 

 

 

Total, International Salons

 

2,095

 

2,055

 

(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.

 

TOTAL SYSTEM-WIDE SALONS:

 

September 30, 2007

 

June 30, 2007

 

Company-owned salons:

 

 

 

 

 

Open at beginning of period

 

8,139

 

7,559

 

Salons constructed

 

85

 

420

 

Acquired

 

32

 

257

 

Franchise buybacks

 

58

 

97

 

Less relocations

 

(15

)

(59

)

Salon openings

 

160

 

715

 

Conversions

 

5

 

—

 

Salons closed

 

(39

)

(135

)

Total company-owned salons

 

8,265

 

8,139

 

 

- more -

 


 

Franchise salons:

 

 

 

 

 

Open at beginning of period

 

3,742

 

3,774

 

Salons constructed

 

55

 

253

 

Acquired (2)

 

42

 

—

 

Less relocations

 

(3

)

(20

)

Salon openings

 

94

 

233

 

Conversions

 

—

 

—

 

Franchise buybacks

 

(58

)

(97

)

Salons closed

 

(25

)

(168

)

Total franchise salons

 

3,753

 

3,742

 

 

 

 

 

 

 

Total Salons

 

12,018

 

11,881

 

 

BEAUTY SCHOOLS

 

 

 

 

 

Open at beginning of period

 

56

 

54

 

Salons constructed

 

—

 

2

 

Acquired

 

—

 

1

 

Less relocations

 

(56

)

(1

)

Total Beauty Schools

 

—

 

56

 

 

HAIR RESTORATION CENTERS:

 

 

 

 

 

Company-owned hair restoration centers:

 

 

 

 

 

Open at beginning of period

 

49

 

48

 

Salons constructed

 

—

 

—

 

Acquired

 

—

 

1

 

Franchise buybacks

 

1

 

1

 

Less relocations

 

—

 

—

 

Salon openings

 

1

 

2

 

Sites closed

 

—

 

(1

)

Total company-owned hair restoration centers

 

50

 

49

 

 

Franchise hair restoration centers:

 

 

 

 

 

Open at beginning of period

 

41

 

42

 

Salons constructed

 

2

 

3

 

Acquired

 

—

 

—

 

Less relocations

 

(2

)

(2

)

Salon openings

 

—

 

1

 

Franchise buybacks

 

(1

)

(1

)

Sites closed

 

—

 

(1

)

Total franchise salons

 

40

 

41

 

 

 

 

 

 

 

Total Hair Restoration Centers

 

90

 

90

 

 

 

 

 

 

 

Ownership interest locations

 

476

 

389

 

 

 

 

 

 

 

Grand Total, System-wide

 

12,584

 

12,416

 

(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.

- more -

 

 

 


 

REVENUES BY CONCEPT:

 

 

 

For the Three Months Ended
September 30,

 

(Dollars in thousands)

 

2007

 

2006

 

North American salons:

 

 

 

 

 

Regis

 

$

127,487

 

$

122,275

 

MasterCuts

 

43,589

 

44,049

 

Trade Secret(1)

 

60,305

 

65,462

 

SmartStyle

 

122,103

 

111,290

 

Strip Center(1)

 

213,079

 

191,830

 

Other(3)

 

5,558

 

—

 

Total North American Salons

 

572,121

 

534,906

 

 

 

 

 

 

 

International salons(1)

 

63,281

 

55,875

 

Beauty schools(3)

 

—

 

19,365

 

Hair restoration centers(1)

 

32,123

 

29,097

 

Consolidated revenues

 

$

667,525

 

$

639,243

 

Percent change from prior year

 

4.4

%

9.4

%

Salon same-store sales increase (decrease) (2)

 

0.9

%

(0.3%

)

 

(1) Includes aggregate franchise royalties and fees of $21.0 and $19.8 million for the three months ended September 30, 2007 and 2006, respectively. North American salon franchise royalties and fees represented 48.3 and 49.6 percent of total franchise revenues in the three months ended September 30, 2007 and 2006, respectively.

 

(2) Salon same-store sales increases or decreases are calculated on a daily basis as the total change in sales for company-owned salons which were open on a specific day of the week during the current period and the corresponding prior period.  Quarterly and year-to-date salon same-store sales increases are the sum of the same-store sales increases computed on a daily basis.  Relocated salons are included in same-store sales as they are considered to have been open in the prior period.  International same-store sales are calculated in local currencies so that foreign currency fluctuations do not impact the calculation.  The Company began including Hair Restoration Centers in its same-store sales calculation beginning with the third fiscal quarter of 2007.  Management believes that same-store sales, a component of organic growth, are useful in order to help determine the increase in salon revenues attributable to its organic growth (new salon construction and same-store sales growth) versus growth from acquisitions.

 

(3) On August 1, 2007, the Company contributed substantially all of its accredited cosmetology schools to Empire Education Group, Inc.  For the three months ended September 30, 2007 the results of operations for the month ended July 31, 2007 are reported in the North American salons segment.

 

 

- more -

 


 

FINANCIAL INFORMATION BY SEGMENT:

Financial information concerning the Company’s salon, school and hair restoration businesses is shown in the following tables.

 

 

For the Three Months Ended September 30, 2007(1)

 

 

 

Salons

 

Hair
Restoration

 

Unallocated

 

 

 

(Dollars in thousands)

 

North America

 

International

 

Centers

 

Corporate

 

Consolidated

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

Service

 

$

407,139

 

$

38,429

 

$

14,150

 

$

—

 

$

459,718

 

Product

 

154,833

 

15,293

 

16,656

 

—

 

186,782

 

Royalties and fees

 

10,149

 

9,559

 

1,317

 

—

 

21,025

 

 

 

572,121

 

63,281

 

32,123

 

—

 

667,525

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

Cost of service

 

234,888

 

20,421

 

7,751

 

—

 

263,060

 

Cost of product

 

80,633

 

8,611

 

4,833

 

—

 

94,077

 

Site operating expenses

 

49,208

 

3,207

 

1,270

 

—

 

53,685

 

General and administrative

 

32,994

 

11,814

 

7,159

 

34,385

 

86,352

 

Rent

 

82,996

 

12,629

 

1,657

 

481

 

97,763

 

Depreciation and amortization

 

21,895

 

2,459

 

2,497

 

4,731

 

31,582

 

Total operating expenses

 

502,614

 

59,141

 

25,167

 

39,597

 

626,519

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

69,507

 

4,140

 

6,956

 

(39,597

)

41,006

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

Interest

 

—

 

—

 

—

 

(10,578

)

(10,578

)

Other, net

 

—

 

—

 

—

 

2,155

 

2,155

 

Income before income taxes

 

$

69,507

 

$

4,140

 

$

6,956

 

$

(48,020

)

$

32,583

 

 

(1) On August 1, 2007, the Company contributed substantially all of its accredited cosmetology schools to Empire Education Group, Inc.  For the three months ended September 30, 2007 the results of operations for the month ended July 31, 2007 are reported in the North American salons segment.

 

-more-

 


 

 

 

For the Three Months Ended September 30, 2006

 

 

 

Salons

 

Beauty

 

Hair
Restoration

 

Unallocated

 

 

 

(Dollars in thousands)

 

North America

 

International

 

Schools

 

Centers

 

Corporate

 

Consolidated

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

Service

 

$

371,199

 

$

33,690

 

$

16,964

 

$

12,699

 

$

—

 

$

434,552

 

Product

 

153,908

 

13,441

 

2,401

 

15,175

 

—

 

184,925

 

Royalties and fees

 

9,799

 

8,744

 

—

 

1,223

 

—

 

19,766

 

 

 

534,906

 

55,875

 

19,365

 

29,097

 

—

 

639,243

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of service

 

212,372

 

17,978

 

8,036

 

7,139

 

—

 

245,525

 

Cost of product

 

79,704

 

7,992

 

1,802

 

4,731

 

—

 

94,229

 

Site operating expenses

 

48,105

 

2,354

 

4,330

 

1,017

 

—

 

55,806

 

General and administrative

 

29,045

 

10,170

 

2,367

 

6,277

 

30,094

 

77,953

 

Rent

 

76,895

 

10,995

 

2,236

 

1,664

 

382

 

92,172

 

Depreciation and amortization

 

20,139

 

1,872

 

812

 

2,334

 

4,385

 

29,542

 

Total operating expenses

 

466,260

 

51,361

 

19,583

 

23,162

 

34,861

 

595,227

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

68,646

 

4,514

 

(218

)

5,935

 

(34,861

)

44,016

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest

 

—

 

—

 

—

 

—

 

(9,838

)

(9,838

)

Other, net

 

—

 

—

 

—

 

—

 

811

 

811

 

Income (loss) before income taxes

 

$

68,646

 

$

4,514

 

$

(218

)

$

5,935

 

$

(43,888

)

$

34,989

 

 

- END -