Financial Data and Key Metrics Changes - For fiscal year 2025, the company reported total revenue of $210 million, an increase of 3.5% or $7.2 million compared to the prior year, primarily driven by increased revenue from company-owned salons due to the acquisition of Align [20][21] - The fourth quarter revenue was $60.4 million, a 22.3% increase or $11 million compared to the prior year, mainly due to increased revenue from company-owned salons and a same-store sales growth of 1.3% [14][15] - Operating income for the fourth quarter was $7.3 million, up from $4.6 million in the year-ago quarter, reflecting a 58.7% increase [16][18] - Adjusted EBITDA for the fourth quarter was $9.7 million, a 24.8% increase compared to $7.8 million in the prior year quarter [19][21] Business Line Data and Key Metrics Changes - The company-owned salon segment's adjusted EBITDA improved by $700,000 year-over-year to $2 million for the quarter, primarily due to an increased number of company-owned salons and the closure of unprofitable salons [20] - The franchise segment's adjusted EBITDA was $7.7 million in the quarter, a $1.2 million increase compared to the prior year, driven by lower general and administrative expenses [19][20] Market Data and Key Metrics Changes - The professional hair salon industry remains resilient, driven by recurring consumer demand and a focus on self-care and wellness, with steady growth particularly in the value-focused segment [8][9] - Salons with higher online booking percentages show a strong correlation to business performance, indicating the effectiveness of digital channels [9] Company Strategy and Development Direction - The company is focused on two primary priorities: the holistic transformation of the Supercuts brand and optimizing sales and profitability in company-owned salons [4][13] - A comprehensive brand research study for Supercuts has been completed to enhance brand relevance and customer engagement [9][10] - The company is working on a new salon prototype aimed at improving efficiency and customer experience, with pilot launches expected in early 2026 [11][34] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's operational improvements and the potential of the company-owned salon portfolio, emphasizing the importance of a new stylist pay model and ongoing pilots [35] - The company anticipates a meaningful increase in unrestricted cash generation from core operations in fiscal year 2026, driven by operational strength and a full year of Align results [24][25] Other Important Information - The company reported a net decrease of 744 franchise locations compared to the previous year, with approximately 300 of these relating to the Align salons that converted from franchise to company-owned [15] - As of June 30, 2025, the company had $25.9 million of available liquidity, including $17 million in unrestricted cash [26] Q&A Session Summary Question: Can you talk more about the Forum 3 initiatives? - Management highlighted Forum 3's role in modernizing the Supercuts brand and enhancing omnichannel growth, including the success of the Supercuts Rewards loyalty program [30][31] Question: How would the new salon prototype be financed and implemented? - Management indicated that they are exploring various financing paths for the new salon prototype, with several franchisees ready to remodel once the prototype is finalized [34] Question: Do you think there's more upside to the Align results? - Management expressed optimism about the company-owned salon portfolio and noted that operational improvements are in the early stages [35] Question: What are your plans on refinancing the debt? - Management confirmed that discussions on refinancing the debt are ongoing, with a focus on strengthening financial positions to secure better terms [40]