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Sally Beauty(SBH) - 2024 Q2 - Quarterly Results
SBHSally Beauty(SBH)2024-05-09 10:45

Financial Performance - Consolidated net sales for Q2 2024 were 908million,adecreaseof1.1908 million, a decrease of 1.1% compared to the prior year[5]. - Consolidated comparable sales declined by 1.5%, primarily due to soft traffic and consumer purchasing trends at Sally Beauty[7]. - GAAP net earnings were 29.2 million, or 0.27perdilutedshare,comparedto0.27 per diluted share, compared to 40.9 million, or 0.37perdilutedshareintheprioryear[11].−Operatingearningsdecreasedby16.60.37 per diluted share in the prior year[11]. - Operating earnings decreased by 16.6% to 59,574 for the three months ended March 31, 2024, compared to 71,408inthesameperiodof2023[37].−ForthethreemonthsendedMarch31,2024,netearningswere71,408 in the same period of 2023[37]. - For the three months ended March 31, 2024, net earnings were 29,244,000, a decrease of 28.4% compared to 40,861,000forthesameperiodin2023[43].−AdjustedEBITDAforthethreemonthsendedMarch31,2024,was40,861,000 for the same period in 2023[43]. - Adjusted EBITDA for the three months ended March 31, 2024, was 99,500,000, a decrease of 5.4% from 105,220,000inthesameperiodof2023[47].−ForthesixmonthsendedMarch31,2024,netearningswere105,220,000 in the same period of 2023[47]. - For the six months ended March 31, 2024, net earnings were 67,634,000, down 25.8% from 91,198,000inthesameperiodof2023[47].MarginsandExpenses−GAAPgrossmarginwas51.091,198,000 in the same period of 2023[47]. Margins and Expenses - GAAP gross margin was 51.0%, unchanged from the prior year, while adjusted gross margin increased by 30 basis points to 51.0%[8]. - GAAP operating earnings were 60 million with an operating margin of 6.6%, down from 71.4millionand7.871.4 million and 7.8% in the prior year[10]. - Selling, general and administrative (SG&A) expenses for the three months ended March 31, 2024, were 403,435,000, representing 44.4% of sales, compared to 42.4% in the same period last year[43]. - SG&A expenses as a percentage of sales for the six months ended March 31, 2024, were 43.6%, compared to 41.6% in the same period last year[45]. Cash Flow and Debt - Cash flow from operations was 37million,withcapitalexpenditurestotaling37 million, with capital expenditures totaling 14.1 million[14]. - The company refinanced a 680millionseniorunsecurednotedue2025,extendingthematurityto2032[3].−Theupdatedfull−yearguidanceincludesanexpectedoperatingcashflowofapproximately680 million senior unsecured note due 2025, extending the maturity to 2032[3]. - The updated full-year guidance includes an expected operating cash flow of approximately 240 million and capital expenditures of about 100million[21].−Thecompanyreportedanetdebtleverageratioof2.2xasofMarch31,2024[12].−Interestexpenseincreasedto100 million[21]. - The company reported a net debt leverage ratio of 2.2x as of March 31, 2024[12]. - Interest expense increased to 20,523,000 for the three months ended March 31, 2024, compared to 16,685,000intheprioryear,markinga23.016,685,000 in the prior year, marking a 23.0% increase[47]. - The company incurred a loss on debt extinguishment related to the repayment of its 5.625% Senior Notes due 2025, which included a write-off of 2,000,000 in unamortized deferred financing costs[43]. Inventory and Assets - Total current assets increased to 1,280,323asofMarch31,2024,comparedto1,280,323 as of March 31, 2024, compared to 1,227,997 as of September 30, 2023[39]. - Inventory rose to 1,039,752asofMarch31,2024,from1,039,752 as of March 31, 2024, from 975,218 as of September 30, 2023[39]. - Total liabilities decreased slightly to 2,195,692asofMarch31,2024,from2,195,692 as of March 31, 2024, from 2,216,502 as of September 30, 2023[39]. Store Performance - As of March 31, 2024, the total number of consolidated stores decreased to 4,468 from 4,484 in 2023, a decline of 16 stores[49]. - The total number of SBS stores decreased to 3,134 in 2024 from 3,143 in 2023, a decline of 9 stores[49]. - The total number of company-operated BSG stores decreased to 1,202 in 2024 from 1,209 in 2023, a decline of 7 stores[49]. - The total number of franchise stores remained unchanged at 132 for both 2024 and 2023[49]. Comparable Sales - Comparable sales for SBS declined by 4.0% in Q1 2024, compared to a growth of 9.1% in Q1 2023, representing a change of 1,310 basis points[50]. - BSG's comparable sales grew by 2.0% in Q1 2024, an increase from 1.3% in Q1 2023, reflecting a change of 70 basis points[50]. - Consolidated comparable sales declined by 1.5% in Q1 2024, compared to a growth of 5.7% in Q1 2023, a change of 720 basis points[50]. - BSG's comparable sales for the six months ended March 31, 2024, increased by 1.3%, compared to a decline of 0.2% in the same period of 2023, reflecting a change of 150 basis points[50]. - The overall comparable sales for the six months ended March 31, 2024, declined by 1.1%, compared to a growth of 3.3% in the same period of 2023, a change of 440 basis points[50].