Sally Beauty(US:SBH)2024-02-01 21:51Financial Performance - Consolidated net sales for the three months ended December 31, 2023, decreased by $25.8 million, or 2.7%, to $931.3 million compared to the same period in 2022[60] - Consolidated comparable sales decreased by 0.8% for the three months ended December 31, 2023[60] - Consolidated gross profit for the three months ended December 31, 2023, decreased by $21.4 million, or 4.4%, to $467.2 million, with a gross margin decline of 80 basis points to 50.2%[60] - Consolidated operating earnings decreased by $17.5 million, or 20.2%, to $69.1 million for the three months ended December 31, 2023, with an operating margin decrease of 160 basis points to 7.4%[60] - Consolidated net earnings decreased by $11.9 million, or 23.7%, to $38.4 million for the three months ended December 31, 2023[60] Cash Flow and Liquidity - Cash provided by operations was $51.0 million for the three months ended December 31, 2023, compared to $55.0 million for the same period in 2022[60] - At December 31, 2023, the company had $603.6 million in liquidity, including $482.6 million available for borrowing under its ABL facility[74] Store Operations - The number of stores at the end of the period decreased by 23, or 0.5%, to 4,475 stores[61] - SBS's net sales decreased by $26.2 million, or 4.8%, primarily due to store closures and fewer transactions[61] - BSG's net sales increased slightly by $0.5 million, or 0.1%, driven by comparable sales growth and improved salon demand trends[61] Asset and Liability Management - As of December 31, 2023, total assets for the Issuers and Guarantors amounted to $2,055,835, a decrease from $2,076,413 as of September 30, 2023, reflecting a decline of approximately 1.0%[84] - Current liabilities decreased from $468,202 as of September 30, 2023, to $459,005 as of December 31, 2023, indicating improved financial management[84] - Total liabilities also saw a reduction from $2,011,075 to $1,982,179 during the same period, reflecting a decrease of approximately 1.4%[84] Shareholder Actions - During the three months ended December 31, 2023, the company repurchased 1.9 million shares of common stock for $20.0 million, marking a strategic move to enhance shareholder value[85] Financial Reporting and Risks - The company had no off-balance sheet financing arrangements other than outstanding letters of credit related to inventory purchases as of December 31, 2023[87] - There have been no material changes to critical accounting estimates or assumptions since September 30, 2023, ensuring consistency in financial reporting[88] - The company remains subject to market risks including foreign currency fluctuations and interest rates, with no material changes reported since September 30, 2023[90] - There have been no material changes to contractual obligations outside the ordinary course of business since September 30, 2023, indicating stable operational commitments[86]