8-K

UNITED STATES

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): April 29, 2009

REGIS CORPORATION
(Exact name of registrant as specified in its charter)

Minnesota	1-12725	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) 947-7777

(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))

Regis Corporation
Current Report on Form 8-K

ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On April 29, 2009, Regis Corporation announced the financial results for its fiscal third quarter ended March 31, 2009.  A copy of the News Release issued by Regis Corporation in connection with this Item 2.02 is attached as Exhibit No. 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.

(d) Exhibits.

EXHIBIT NUMBER
99	Regis Corporation News Release dated April 29, 2009.

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: April 29, 2009	By:	/s/ Eric Bakken
		Name: Eric Bakken, Title: Secretary

EXHIBIT INDEX

EXHIBIT NUMBER
99	Regis Corporation News Release dated April 29, 2009.

3

EX-99

Exhibit No. 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 THIRD QUARTER 2009 RESULTS

-Third Quarter EPS from Continuing Operations of $0.49 per Share-

MINNEAPOLIS, April 29, 2009 — Regis Corporation (NYSE:RGS), the global leader in the $170 billion hair care industry, today reported third quarter net income from continuing operations of $21.0 million, or $0.49 per diluted share, compared to $19.1 million or $0.44 per diluted share a year ago.   Last year, third quarter earnings per diluted share from continuing operations included $0.07 of incremental tax expense related to the repatriation of international cash.

On April 8, 2009, the Company reported third quarter consolidated total same-store sales declined 4.5 percent.  In addition, the Company reported that revenues for the third quarter ended March 31, 2009 decreased 2.4 percent to $604 million compared to $619 million in the third quarter of fiscal 2008. The deconsolidation of the European franchise salon operations reduced revenue in the quarter by approximately $5 million.  Absent the impact of the European deconsolidation, consolidated revenues for the quarter would have decreased 1.6 percent.

“We were very encouraged with our ability to maintain our year-over-year profitability levels despite the extremely difficult sales environment,” commented Paul D. Finkelstein, Chairman and Chief Executive Officer.  “We are on or ahead of plan with all of our debt reduction and cost saving initiatives.  Our entire organization is focused on our near-term strategy of strengthening our balance sheet, significantly reducing expenditures in salon unit growth, reducing debt levels and controlling expenses.”

Mr. Finkelstein concluded, “Last quarter, we made the decision to discontinue providing quarterly and annual sales and earnings guidance, at least until economic conditions normalize.  Today, it is still far too difficult to predict how long and how deep this recession will be.  Therefore, we will not be providing fourth quarter or fiscal 2010 detailed revenue and earnings guidance.  I would like to provide some insight into our current internal fiscal 2010 expectations.  Based on the current economic environment, same-store sales could be in a range of negative three percent to positive one percent.  At these same-store sales levels, EBITDA should be in a range of $200 million to $240 million.  We expect total capital expenditures (CAPEX) and acquisition spend to be in the range of $90 million to $100 million, a reduction of approximately $35 million compared to fiscal 2009. The 2010 CAPEX budget includes approximately $55 million to $60 million for maintenance.  Finally, we plan to pay down approximately $30 million to $50 million of debt during fiscal 2010.”

As of March 31, 2009 Regis Corporation owned, franchised, or held ownership interest in 12,854 worldwide locations.

Regis Corporation will host a conference call discussing third quarter results today, April 29, 2009 at 10 a.m., Central time. Interested parties are invited to listen by logging on to www.regiscorp.com or dialing 800-218-0713. A replay of the call will be available later that day. The replay phone number is 800-405-2236, access code 11128659#.

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 March 31, 2009, the Company owned, franchised or held ownership interests in over 12,800 worldwide locations.  Regis’ corporate and franchised locations operate under concepts such as Supercuts, Sassoon Salon, Regis Salons, MasterCuts, SmartStyle, Cost Cutters, Cool Cuts 4 Kids and Hair Club for Men and Women.  In addition, Regis maintains an ownership interest in Provalliance, which operates salons primarily in Europe, under the brands of Jean Louis David, Franck Provost and Saint Algue.  Regis also maintains ownership interests in Empire Education Group and the MY Style concepts in Japan.  System-wide, these and other concepts are located in the U.S. and in over 30 other countries in North America, South America, Europe, Africa and Asia. Regis also maintains a 49 percent ownership interest in Intelligent Nutrients, a business that provides a wide variety of certified organic products for health and beauty.  For additional information about the company, including 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; the ability of the Company to implement its planned spending and cost reduction plan and to continue to maintain compliance with the financial covenants in its credit agreements; 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; the ability of the Company to consummate the planned closure of salons and the related realization of the anticipated costs, benefits and time frame; or other factors not listed above. The ability of the Company to meet its expected revenue target 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, 2008. 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 March 31, 2009 and June 30, 2008
(In thousands, except per share data)

	March 31, 2009		June 30, 2008
ASSETS
Current assets:
Cash and cash equivalents	$	57,063	$	127,627
Receivables, net	35,713		37,824
Inventories	165,022		212,468
Deferred income taxes	19,963		15,954
Other current assets	94,009		51,278
Total current assets	371,770		445,151
Property and equipment, net	407,660		481,851
Goodwill	760,565		870,993
Other intangibles, net	128,205		144,291
Investment in affiliates	218,330		247,102
Other assets	43,305		46,483
Total assets	$	1,929,835	$	2,235,871
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Long-term debt, current portion	$	121,260	$	230,224
Accounts payable	63,297		69,693
Accrued expenses	158,637		207,605
Total current liabilities	343,194		507,522
Long-term debt and capital lease obligations	580,347		534,523
Other noncurrent liabilities	222,843		217,640
Total liabilities	1,146,384		1,259,685
Shareholders’ equity:
Common stock, $0.05 par value; issued and outstanding 43,202,231 and 43,070,927 common shares at March 31, 2009 and June 30, 2008, respectively	2,160		2,153
Additional paid-in capital	152,028		143,265
Accumulated other comprehensive income	25,560		101,973
Retained earnings	603,703		728,795
Total shareholders’ equity	783,451		976,186
Total liabilities and shareholders’ equity	$	1,929,835	$	2,235,871

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REGIS CORPORATION (NYSE: RGS)

CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)

(In thousands, except per share data)

	Three Months Ended March 31,						Nine Months Ended March 31,
	2009			2008			2009			2008
Revenues:
Service	$	453,301		$	467,145		$	1,367,414		$	1,370,759
Product	128,573			137,667			395,530			413,583
Product sold to Premier (1)	12,596			—			12,596			—
Royalties and fees	9,616			14,045			29,501			56,511
	604,086			618,857			1,805,041			1,840,853
Operating expenses:
Cost of service	259,465			267,705			783,380			783,760
Cost of product	61,621			66,060			192,318			198,708
Cost of product sold to Premier (1)	12,596			—			12,596			—
Site operating expenses	49,864			47,506			145,886			140,916
General and administrative	69,592			77,825			219,887			244,141
Rent	85,654			89,662			259,846			266,102
Depreciation and amortization	27,384			26,958			82,171			83,495
Goodwill impairment	—			—			41,661			—
Lease termination costs	838			—			2,836			—
Total operating expenses	567,014			575,716			1,740,581			1,717,122
Operating income	37,072			43,141			64,460			123,731
Other income (expense):
Interest expense	(9,684		)	(11,266		)	(30,782		)	(33,495		)
Interest income and other, net	1,316			1,829			6,513			6,074
Income from continuing operations before income taxes and equity in income of affiliated companies	28,704			33,704			40,191			96,310
Income taxes	(9,667		)	(15,196		)	(29,008		)	(37,681		)
Equity in income of affiliated companies, net of income taxes	1,988			638			142			690
Income from continuing operations	$	21,025		$	19,146		$	11,325		$	59,319
(Loss) income from discontinued operations, net of tax	(12,171		)	(178		)	(131,237		)	2,804
Net income (loss)	$	8,854		$	18,968		$	(119,912	)	$	62,123
Net income per share:
Basic:
Income from continuing operations	$	0.49		$	0.45		$	0.26		$	1.37
(Loss) income from discontinued operations, net of tax	(0.28		)	(0.01		)	(3.06		)	0.06
Net income (loss) per share, basic	$	0.21		$	0.44		$	(2.80	)	$	1.43
Diluted:
Income from continuing operations	$	0.49		$	0.44		$	0.26		$	1.36
(Loss) income from discontinued operations, net of tax	(0.28		)	—			(3.05		)	0.06
Net income (loss) per share, diluted	$	0.21		$	0.44		$	(2.79	)	$	1.42
Weighted average common and common equivalent shares outstanding:
Basic	42,905			42,638			42,863			43,303
Diluted	42,917			43,025			42,966			43,831
Cash dividends declared per common share	$	0.04		$	0.04		$	0.12		$	0.12

(1) Premier Salons Beauty, Inc. (Premier) purchased Trade Secret, Inc. from Regis Corporation on February 16, 2009.  The agreement included a provision that Regis Corporation will supply product to Premier at cost for a transition period of approximately six months following the date of the sale, with possible extension to not more than eleven months.

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

	Nine Months Ended March 31,
	2009			2008
Net cash provided by operating activities	$	120,725		$	167,839
Net cash used in investing activities	(92,521		)	(237,524		)
Net cash (used in) provided by financing activities	(79,637		)	24,049
Effect of exchange rate changes on cash and cash equivalents	(19,131		)	(2,860		)
Decrease in cash and cash equivalents	(70,564		)	(48,496		)
Cash and cash equivalents:
Beginning of year	127,627			184,785
End of year	$	57,063		$	136,289

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REGIS CORPORATION (NYSE: RGS)

Salon / School / Hair Restoration Center Counts and Revenues

	March 31, 2009	June 30, 2008
SYSTEM-WIDE LOCATIONS:
Company-owned salons	8,008	8,582
Franchise salons	2,038	2,163
Company-owned hair restoration centers	62	57
Franchise hair restoration centers	33	35
Ownership interest locations	2,713	2,714
Total, system-wide	12,854	13,551

SALON LOCATION SUMMARY

	March 31, 2009		June 30, 2008
NORTH AMERICAN SALONS:
REGIS SALONS
Open at beginning of period	1,078		1,099
Salons constructed	16		14
Acquired	23		4
Less relocations	(11	)	(11	)
Salon openings	28		7
Conversions	—		1
Salons closed	(32	)	(29	)
Total, Regis Salons	1,074		1,078
MASTERCUTS
Open at beginning of period	615		629
Salons constructed	14		7
Acquired	—		—
Less relocations	(10	)	(6	)
Salon openings	4		1
Conversions	—		—
Salons closed	(9	)	(15	)
Total, MasterCuts Salons	610		615
TRADE SECRET (3)
Company-owned salons:
Open at beginning of period	674		613
Salons constructed	10		16
Acquired	—		65
Franchise buybacks	—		5
Less relocations	(4	)	(11	)
Salon openings	6		75
Conversions	—		5
Salons sold	(659	)	—
Salons closed	(21	)	(19	)
Total company-owned salons	—		674

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	March 31, 2009		June 30, 2008
Franchise salons:
Open at beginning of period	106		19
Salons constructed	1		2
Acquired	—		93
Less relocations	—		(1	)
Salon openings	1		94
Franchise buybacks	—		(5	)
Salons sold	(62	)	—
Salons closed	(2	)	(2	)
Total franchise salons	43		106
Total, Trade Secret Salons	43		780
SMARTSTYLE/COST CUTTERS IN WAL-MART
Company-owned salons:
Open at beginning of period	2,212		2,000
Salons constructed	53		207
Acquired	—		—
Franchise buybacks	24		12
Less relocations	(1	)	(3	)
Salon openings	76		216
Conversions	—		—
Salons closed	(1	)	(4	)
Total company-owned salons	2,287		2,212
Franchise salons:
Open at beginning of period	146		151
Salons constructed	1		7
Acquired	—		—
Less relocations	—		—
Salon openings	1		7
Conversions	—		—
Franchise buybacks	(24	)	(12	)
Salons closed	(1	)	—
Total franchise salons	122		146
Total, SmartStyle/Cost Cutters in Wal-Mart Salons	2,409		2,358
STRIP CENTERS
Company-owned salons:
Open at beginning of period	3,531		3,317
Salons constructed	48		66
Acquired	71		138
Franchise buybacks	59		133
Less relocations	(12	)	(14	)
Salon openings	166		323
Conversions	(1	)	(5	)
Salons closed	(115	)	(104	)
Total company-owned salons	3,581		3,531

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	March 31, 2009		June 30, 2008
Franchise salons:
Open at beginning of period	1,911		1,998
Salons constructed	73		120
Acquired (2)	—		—
Less relocations	(10	)	(11	)
Salon openings	63		109
Conversions	1		—
Franchise buybacks	(59	)	(133	)
Salons closed	(43	)	(63	)
Total franchise salons	1,873		1,911
Total, Strip Center Salons	5,454		5,442
INTERNATIONAL SALONS (1)
Company-owned salons:
Open at beginning of period	472		481
Salons constructed	4		15
Acquired	—		25
Franchise buybacks	—		—
Less relocations	(1	)	(1	)
Salon openings	3		39
Conversions	—		1
Affiliate joint ventures	—		(40	)
Salons closed	(19	)	(9	)
Total company-owned salons	456		472
Franchise salons:
Open at beginning of period	—		1,574
Salons constructed	—		50
Acquired (2)	—		—
Less relocations	—		—
Salon openings	—		50
Conversions	—		3
Franchise buybacks	—		—
Affiliate joint ventures	—		(1,587	)
Salons closed	—		(40	)
Total franchise salons	—		—
Total, International Salons	456		472

TOTAL SYSTEM-WIDE SALONS:	March 31, 2009		June 30, 2008
Company-owned salons:
Open at beginning of period	8,582		8,139
Salons constructed	145		325
Acquired	94		232
Franchise buybacks	83		150
Less relocations	(39	)	(46	)
Salon openings	283		661
Conversions	(1	)	2
Affiliate joint ventures	—		(40	)
Salons sold	(659	)	—
Salons closed	(197	)	(180	)
Total company-owned salons	8,008		8,582

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	March 31, 2009		June 30, 2008
Franchise salons:
Open at beginning of period	2,163		3,742
Salons constructed	75		179
Acquired (2)	—		93
Less relocations	(10	)	(12	)
Salon openings	65		260
Conversions	1		3
Franchise buybacks	(83	)	(150	)
Affiliate joint ventures	—		(1,587	)
Salons sold	(62	)	—
Salons closed	(46	)	(105	)
Total franchise salons	2,038		2,163
Total Salons	10,046		10,745
BEAUTY SCHOOLS
Open at beginning of period	—		56
Salons constructed	—		—
Less closures	—		—
Acquired	—		—
Less relocations	—		—
Conversions	—		(5	)
Affiliate joint ventures	—		(51	)
Total Beauty Schools	—		—
HAIR RESTORATION CENTERS:
Company-owned hair restoration centers:
Open at beginning of period	57		49
Salons constructed	7		3
Acquired	—		—
Franchise buybacks	2		6
Less relocations	(4	)	(1	)
Salon openings	5		8
Conversions	—		—
Sites closed	—		—
Total company-owned hair restoration centers	62		57

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	March 31, 2009		June 30, 2008
Franchise hair restoration centers:
Open at beginning of period	35		41
Salons constructed	—		2
Acquired	—		—
Less relocations	—		(2	)
Salon openings	—		—
Franchise buybacks	(2	)	(6	)
Sites closed	—		—
Total franchise hair restoration centers	33		35
Total Hair Restoration Centers	95		92
Ownership interest locations	2,713		2,714
Grand Total, System-wide	12,854		13,551

(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.

(3)  On February 16, 2009 the Company announced the completion of the sale of Trade Secret retail product division to Premier Salons Beauty, Inc.  As a result of this transaction, the Company reported the Trade Secret operations as discontinued operations for all periods presented.  Forty-three franchise salons were not included in the sale of Trade Secret to Premier Salons Beauty, Inc. and are not reported as discontinued operations.

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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REVENUES BY CONCEPT:

	Three Months Ended March 31,						Nine Months Ended March 31,
(Dollars in thousands)	2009			2008			2009			2008
North American salons:
Regis	$	117,424		$	130,272		$	360,767		$	386,839
MasterCuts	43,237			44,755			128,750			132,223
SmartStyle	136,012			130,476			395,053			374,759
Strip Centers (1)(6)	236,882			222,765			690,332			649,320
Other (2)	—			—			—			5,558
Total North American salons (5)	533,555			528,268			1,574,902			1,548,699
International salons (1)(3)	35,878			55,973			125,594			192,310
Hair restoration centers (1)	34,653			34,616			104,545			99,844
Consolidated revenues	$	604,086		$	618,857		$	1,805,041		$	1,840,853
Percent change from prior year	(2.4		)%	3.7		%	(1.9		)%	4.9		%
Same-store sales (decrease) increase (4)	(4.5		)%	2.2		%	(2.8		)%	1.4		%

(1) Includes aggregate franchise royalties and fees of $9.6 and $14.0 million for the three months ended March 31, 2009 and 2008, respectively, and $29.5 and $56.5 million for the nine months ended March 31, 2009 and 2008, respectively.  North American salon franchise royalties and fees represented 93.5 and 68.8 percent of total franchise revenues in the three months ended March 31, 2009 and 2008, respectively, and 93.6 and 52.2 percent of total franchise revenues in the nine months ended March 31, 2009 and 2008, respectively.

(2) On August 1, 2007, the Company contributed 51 of its accredited cosmetology schools to Empire Education Group, Inc.  Accordingly, revenue growth was negatively impacted as a result of the deconsolidation. For the nine months ended March 31, 2008, the results of operations for the month ended July 31, 2007 for the accredited cosmetology schools are reported in the North American salons segment. The Company retained ownership of its one North America and four United Kingdom Sassoon schools. Subsequent to August 1, 2007 results of operations for the Sassoon schools are included in the respective North American and international salon segments.

(3) On January 31, 2008, the Company deconsolidated the results of operations of its European franchise salon operations. Accordingly, revenue growth was negatively impacted as a result of the deconsolidation.

(4) 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.  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.

(5) Beginning with the period ended December 31, 2008, the operations of the Trade Secret concept within the North American reportable segment were accounted for as a discontinued operation. All periods presented reflect Trade Secret as a discontinued operation.

(6) Premier Salons Beauty, Inc. (Premier) purchased Trade Secret, Inc. from Regis Corporation on February 16, 2009.  The agreement included a provision that Regis Corporation will supply product to Premier at cost for a transition period of approximately six months following the date of the sale, with possible extension to not more than eleven months.  For the three and nine months ended March 31, 2009, the Company generated revenue of $12.6 and $12.6 million, respectively, in product sold to Premier, which represented 2.1 and 0.7 percent of consolidated revenues, respectively.

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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 March 31, 2009(1)(3)
	Salons				Hair Restoration		Unallocated
(Dollars in thousands)	North America		International		Centers		Corporate			Consolidated
Revenues:
Service	$	412,226	$	24,858	$	16,217	$	—		$	453,301
Product	99,743		11,020		17,810		—			128,573
Product sold to Premier (2)	12,596		—		—		—			12,596
Royalties and fees	8,990		—		626		—			9,616
	533,555		35,878		34,653		—			604,086
Operating expenses:
Cost of service	238,093		12,482		8,890		—			259,465
Cost of product	50,046		6,252		5,323		—			61,621
Cost of product sold to Premier (2)	12,596		—		—		—			12,596
Site operating expenses	46,211		2,364		1,289		—			49,864
General and administrative	28,289		2,942		9,225		29,136			69,592
Rent	73,426		9,438		2,268		522			85,654
Depreciation and amortization	18,678		1,512		2,893		4,301			27,384
Goodwill impairment	—		—		—		—			—
Lease termination costs	838		—		—		—			838
Total operating expenses	468,177		34,990		29,888		33,959			567,014
Operating income	65,378		888		4,765		(33,959		)	37,072
Other income (expense):
Interest expense	—		—		—		(9,684		)	(9,684		)
Interest income and other, net	—		—		—		1,316			1,316
Income from continuing operations before income taxes and equity in income of affiliated companies	$	65,378	$	888	$	4,765	$	(42,327	)	$	28,704

(1) Beginning with the period ended December 31, 2008, the operations of the Trade Secret concept within the North American reportable segment were accounted for as a discontinued operation. All periods presented reflect Trade Secret as a discontinued operation.

(2) Premier Salons Beauty, Inc. (Premier) purchased Trade Secret, Inc. from Regis Corporation on February 16, 2009.  The agreement included a provision that Regis Corporation will supply product to Premier at cost for a transition period of approximately six months following the date of the sale, with possible extension to not more than eleven months.

(3) On January 31, 2008, the Company merged its continental European franchise operations with the Franck Provost Salon Group.

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	For the Three Months Ended March 31, 2008(1)(3)
	Salons				Hair Restoration		Unallocated
(Dollars in thousands)	North America		International		Centers		Corporate			Consolidated
Revenues:
Service	$	414,176	$	36,772	$	16,197	$	—		$	467,145
Product	104,433		15,853		17,381		—			137,667
Product sold to Premier (2)	—		—		—		—			—
Royalties and fees	9,659		3,348		1,038		—			14,045
	528,268		55,973		34,616		—			618,857
Operating expenses:
Cost of service	238,474		20,405		8,826		—			267,705
Cost of product	52,412		8,672		4,976		—			66,060
Cost of product sold to Premier (2)	—		—		—		—			—
Site operating expenses	42,662		3,611		1,233		—			47,506
General and administrative	30,215		7,543		8,018		32,049			77,825
Rent	74,235		12,991		1,923		513			89,662
Depreciation and amortization	18,173		2,223		2,627		3,935			26,958
Goodwill impairment	—		—		—		—			—
Lease termination costs	—		—		—		—			—
Total operating expenses	456,171		55,445		27,603		36,497			575,716
Operating income	72,097		528		7,013		(36,497		)	43,141
Other income (expense):
Interest expense	—		—		—		(11,266		)	(11,266		)
Interest income and other, net	—		—		—		1,829			1,829
Income from continuing operations before income taxes and equity in income of affiliated companies	$	72,097	$	528	$	7,013	$	(45,934	)	$	33,704

(1) Beginning with the period ended December 31, 2008, the operations of the Trade Secret concept within the North American reportable segment were accounted for as a discontinued operation. All periods presented reflect Trade Secret as a discontinued operation.

(2) Premier Salons Beauty, Inc. (Premier) purchased Trade Secret, Inc. from Regis Corporation on February 16, 2009.  The agreement included a provision that Regis Corporation will supply product to Premier at cost for a transition period of approximately six months following the date of the sale, with possible extension to not more than eleven months.

(3) On January 31, 2008, the Company merged its continental European franchise operations with the Franck Provost Salon Group.  For the three months ended March 31, 2008, the results of operations for the one month ended January 31, 2008 are reported in the International salon segment.

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	For the Nine Months Ended March 31, 2009(1)(3)
	Salons					Hair Restoration		Unallocated
(Dollars in thousands)	North America		International			Centers		Corporate			Consolidated
Revenues:
Service	$	1,229,736	$	89,080		$	48,598	$	—		$	1,367,414
Product	304,947		36,514			54,069		—			395,530
Product sold to Premier (2)	12,596		—			—		—			12,596
Royalties and fees	27,623		—			1,878		—			29,501
	1,574,902		125,594			104,545		—			1,805,041
Operating expenses:
Cost of service	709,874		46,902			26,604		—			783,380
Cost of product	155,723		20,329			16,266		—			192,318
Cost of product sold to Premier (2)	12,596		—			—		—			12,596
Site operating expenses	133,351		8,544			3,991		—			145,886
General and administrative	89,945		11,496			25,679		92,767			219,887
Rent	219,788		31,873			6,592		1,593			259,846
Depreciation and amortization	55,407		4,794			8,377		13,593			82,171
Goodwill impairment	—		41,661			—		—			41,661
Lease termination costs	2,836		—			—		—			2,836
Total operating expenses	1,379,520		165,599			87,509		107,953			1,740,581
Operating income (loss)	195,382		(40,005		)	17,036		(107,953		)	64,460
Other income (expense):
Interest expense	—		—			—		(30,782		)	(30,782		)
Interest income and other, net	—		—			—		6,513			6,513
Income (loss) from continuing operations before income taxes and equity in income of affiliated companies	$	195,382	$	(40,005	)	$	17,036	$	(132,222	)	$	40,191

(1) Beginning with the period ended December 31, 2008, the operations of the Trade Secret concept within the North American reportable segment were accounted for as a discontinued operation. All periods presented reflect Trade Secret as a discontinued operation.

(2) Premier Salons Beauty, Inc. (Premier) purchased Trade Secret, Inc. from Regis Corporation on February 16, 2009.  The agreement included a provision that Regis Corporation will supply product to Premier at cost for a transition period of approximately six months following the date of the sale, with possible extension to not more than eleven months.

(3) On January 31, 2008, the Company merged its continental European franchise operations with the Franck Provost Salon Group.

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	For the Nine Months Ended March 31, 2008(1)(2)(4)
	Salons				Hair Restoration		Unallocated
(Dollars in thousands)	North America		International		Centers		Corporate			Consolidated
Revenues:
Service	$	1,206,720	$	118,425	$	45,614	$	—		$	1,370,759
Product	312,507		50,279		50,797		—			413,583
Product sold to Premier (3)	—		—		—		—			—
Royalties and fees	29,472		23,606		3,433		—			56,511
	1,548,699		192,310		99,844		—			1,840,853
Operating expenses:
Cost of service	694,047		64,917		24,796		—			783,760
Cost of product	156,573		27,400		14,735		—			198,708
Cost of product sold to Premier (3)	—		—		—		—			—
Site operating expenses	126,580		10,526		3,810		—			140,916
General and administrative	90,423		31,143		22,534		100,041			244,141
Rent	219,464		39,904		5,308		1,426			266,102
Depreciation and amortization	55,109		7,271		7,676		13,439			83,495
Goodwill impairment	—		—		—		—			—
Lease termination costs	—		—		—		—			—
Total operating expenses	1,342,196		181,161		78,859		114,906			1,717,122
Operating income	206,503		11,149		20,985		(114,906		)	123,731
Other income (expense):
Interest expense	—		—		—		(33,495		)	(33,495		)
Interest income and other, net	—		—		—		6,074			6,074
Income from continuing operations before income taxes and equity in income of affiliated companies	$	206,503	$	11,149	$	20,985	$	(142,327	)	$	96,310

(1) On August 1, 2007, the Company contributed substantially all of its accredited cosmetology schools to Empire Education Group, Inc.  For the nine months ended March 31, 2008 the results of operations for the month ended July 31, 2007 are reported in the North American salons segment.  The Company retained ownership of its one North America and four United Kingdom Vidal Sassoon schools. Results of operations for the Vidal Sassoon schools are included in the respective North American and international salon segments.

(2) Beginning with the period ended December 31, 2008, the operations of the Trade Secret concept within the North American reportable segment were accounted for as a discontinued operation. All periods presented reflect Trade Secret as a discontinued operation.

(3) Premier Salons Beauty, Inc. (Premier) purchased Trade Secret, Inc. from Regis Corporation on February 16, 2009.  The agreement included a provision that Regis Corporation will supply product to Premier at cost for a transition period of approximately six months following the date of the sale, with possible extension to not more than eleven months.

(4) On January 31, 2008, the Company merged its continental European franchise operations with the Franck Provost Salon Group.  For the nine months ended March 31, 2008, the results of operations for the seven months ended January 31, 2008 are reported in the International salon segment.

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REGIS CORPORATION (NYSE: RGS)

NON-GAAP FINANCIAL MEASURES (Unaudited)

The Company’s press release announcing results of operations for the three month period ended March 31, 2009 includes references to the following “non-GAAP financial measures” as defined by Regulation G of the Securities and Exchange Commission:

·Deconsolidation of the European franchise salon operations reduced revenue in the quarter by approximately $5 million. Absent the impact of the European deconsolidation, consolidated revenues for the quarter would have decreased 1.6 percent.

Non-GAAP Consolidated Revenues

On January 31, 2008, the Company merged its continental European franchise salon operations with the Franck Provost Salon Group.  The results of operations through January 31, 2008 were included in the consolidated statement of operations.

The unaudited adjusted revenues, a non-GAAP financial measure (adjusted revenues) set for below, assumes the deconsolidation of the European franchise salon operations as of July 1, 2007.  Management believes this measurement is a meaningful presentation of the revenue growth of the Company’s core salon and hair restoration businesses between the comparable periods, excluding the impact of deconsolidating the European franchise salon operations.  If the Company had deconsolidated the European franchise salon operations on the date assumed in the adjusted revenues, the Company might have performed differently.  You should not rely on the adjusted revenues as an indication of the revenues that the Company would have achieved, had the deconsolidation of the European franchise salon operations been completed at the date indicated, or of the future revenues that the Company will achieve after the deconsolidation of the European franchise salon operations.

The adjusted revenues are based on available information and certain assumptions that management believes are reasonable.  The unaudited adjusted revenues should be read in conjunction with the historical financial statements of the Company.

	Three Months Ended			Three Months Ended
	March 31, 2009			March 31, 2008
	(Dollars in thousands)			(Dollars in thousands)
Consolidated revenues, as reported (U.S. GAAP)	$	604,086		$	618,857
Decrease in consolidated revenues, as reported	(2.4		)%
Consolidated revenues, as reported (U.S. GAAP)	$	604,086		$	618,857
Deconsolidation of European franchise salon operations	—			(5,038		)
Consolidated revenues, adjusted	$	604,086		$	613,819
Decrease in consolidated revenues, adjusted	(1.6		)%

Non-GAAP EBITDA

EBITDA represents net income plus income taxes, interest expense, depreciation and amortization and equity in income of affiliates.  Management believes that EBITDA is an appropriate measure of evaluating operating performance and liquidity, because it reflects the resources available for strategic opportunities including, among others, to invest in the business, make strategic acquisitions and strengthen the balance sheet.

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