Sally Magnificence Holdings Experiences Fourth Quarter and Full 12 months Fiscal 2021 Outcomes; Offers Fiscal 2022 Outlook


DENTON, Texas–(BUSINESS WIRE)–Sally Magnificence Holdings, Inc. (NYSE: SBH) (“the Firm”), the chief in skilled hair shade, in the present day introduced monetary outcomes for its fourth quarter and full yr ended September 30, 2021. The Firm will maintain a convention name in the present day at 7:30 a.m. Central Time to debate the outcomes.

Fiscal 2021 Fourth Quarter Abstract

  • Consolidated web gross sales elevated 3.4% to $990 million with a similar retailer gross sales enhance of two.1%;
  • World e-commerce gross sales had been $71 million, representing 7.1% of web gross sales;
  • Gross margin of fifty.6%, down 50 foundation factors in comparison with the prior yr;
  • GAAP working earnings of $111 million and GAAP working margin of 11.2%, Adjusted Working Earnings of $116 million and Adjusted Working Margin of 11.7%;
  • Curiosity expense of $20 million in comparison with $28 million within the prior yr, reflecting the Firm’s deleveraging efforts;
  • GAAP diluted web earnings per share of $0.59 and Adjusted Diluted Web Earnings Per Share of $0.64; and
  • Sturdy money circulation from operations of $164 million, primarily pushed by sturdy earnings and timing of working capital necessities.

Fiscal 2021 Full 12 months Abstract

  • Consolidated web gross sales elevated 10.3% to $3.87 billion, with a similar retailer gross sales enhance of 10.2%;
  • World e-commerce gross sales had been $281 million, representing 7.2% of web gross sales;
  • Gross margin expanded 160 foundation factors to 50.4% in comparison with the prior yr;
  • GAAP working earnings of $418 million and GAAP working margin of 10.8%, Adjusted Working Earnings of $461 million and Adjusted Working Margin of 11.9%;
  • GAAP diluted web earnings per share of $2.10 and Adjusted Diluted Web Earnings Per Share of $2.40;
  • Sturdy money circulation from operations of $382 million;
  • Sturdy liquidity place, money and money equivalents of $401 million with no excellent borrowings below the $500 million asset-based revolving line of credit score at yr finish; and
  • Retired roughly $420 million of debt throughout the fiscal yr.

We’re happy to conclude the yr with sturdy fourth quarter efficiency, highlighted by web gross sales progress of three.4%, adjusted working margin of 11.7% and working money circulation of $164 million,” stated Denise Paulonis, president and chief govt officer. “In fiscal 2021, we efficiently executed on our acknowledged priorities to considerably full the remaining parts of our transformation and leverage our new capabilities and instruments in service of our mission to recruit and retain shade prospects. We rebounded strongly from final yr’s pandemic challenges, delivering web gross sales progress of 10.3% whereas producing sturdy profitability and money circulation and lowering our debt ranges by over $400 million in fiscal 2021.”

Serving on the Board of Administrators over the past 4 years, I’ve admired the large work and dedication of our groups and associates as they prioritized the client and reworked our enterprise into a contemporary, dynamic magnificence firm. I’m extremely excited to affix this administration group and stay up for constructing upon our sturdy basis of enhanced capabilities throughout CRM, loyalty, e-commerce, merchandising, expertise and expertise, as we pivot to a brand new period for SBH centered on buyer centricity and the acceleration of long-term worthwhile progress.”

Fiscal 2021 Fourth Quarter Working Outcomes

Fourth quarter consolidated web gross sales had been $990.3 million, a rise of three.4% in comparison with the prior yr, with a similar retailer gross sales enhance of two.1%. Overseas forex translation had a positive influence of roughly 90 foundation factors on reported gross sales. The Firm was working 127 fewer shops on the finish of the quarter in comparison with the prior yr. World e-commerce gross sales had been $71 million or 7.1% of web gross sales for the quarter.

Consolidated gross revenue for the fourth quarter was $501.0 million in comparison with $489.1 million within the prior yr, a rise of two.4%. Consolidated gross margin was 50.6%, a lower of fifty foundation factors in comparison with 51.1% within the prior yr, primarily reflecting a better mixture of Magnificence Methods Group gross sales and a decrease gross margin at Magnificence Methods Group.

Promoting, basic and administrative (SG&A) bills totaled $386.5 million, up $19.6 million in comparison with the prior yr, pushed primarily by elevated labor and promoting prices, as beforehand deliberate. As a share of gross sales, SG&A bills had been 39.0% in comparison with 38.3% within the prior yr.

GAAP working earnings and working margin within the fourth quarter had been $111.2 million and 11.2%, in comparison with $119.7 million and 12.5%, within the prior yr. Adjusted Working Earnings and Working Margin, excluding the Firm’s beforehand introduced restructuring efforts and COVID-19 associated earnings in each years, had been $115.8 million and 11.7%, in comparison with $120.3 million and 12.6%, within the prior yr.

GAAP web earnings within the fourth quarter had been $68.1 million, or $0.59 per diluted share, in comparison with web earnings of $70.2 million, or $0.62 per diluted share within the prior yr. Adjusted Web Earnings had been $73.1 million, or $0.64 per diluted share, in comparison with Adjusted Web Earnings of $70.7 million, or $0.63 per diluted share within the prior yr. Adjusted EBITDA within the fourth quarter was $143.4 million, a lower of two% in comparison with the prior yr, and Adjusted EBITDA Margin was 14.5%, a lower of 80 foundation factors in comparison with the prior yr.

Stability Sheet and Money Circulation

As of September 30, 2021, the Firm had money and money equivalents of $401 million and no borrowings excellent below its asset-based revolving line of credit score. Fourth quarter money circulation from operations totaled $164.1 million, capital expenditures totaled $28.8 million and Working Free Money Circulation totaled $135.4 million. For the complete fiscal yr, money circulation from operations totaled $381.9 million, capital expenditures totaled $73.7 million and Working Free Money Circulation totaled $308.2 million.

In fiscal 2021, the Firm diminished its debt ranges by roughly $420 million. Moreover, the Firm ended the yr with a web debt leverage ratio of 1.69x.

Fiscal 2021 Fourth Quarter Section Outcomes

Sally Magnificence Provide

  • Section web gross sales had been $585.4 million within the quarter, a rise of 1.5% in comparison with the prior yr. The section had a positive influence of 120 foundation factors from international forex translation on reported gross sales and operated 104 fewer shops on the finish of the quarter in comparison with the prior yr. Section e-commerce gross sales had been $29 million or 5.0% of section web gross sales for the quarter.
  • Section similar retailer gross sales elevated 2.3% within the fourth quarter. The Sally Magnificence companies within the U.S. and Canada represented 79% of section web gross sales for the quarter and had a similar retailer gross sales enhance of 1.9%.
  • On the finish of the quarter, web retailer rely was 3,549, a lower of 104 shops in comparison with the prior yr.
  • Gross margin decreased by 10 foundation factors to 57.5%, with the Sally Magnificence enterprise within the U.S. and Canada delivering gross margin of 60.9%. Product margin was up barely in comparison with the prior yr, offset by larger distribution and freight prices.
  • GAAP working earnings had been $105.7 million in comparison with $103.9 million within the prior yr, representing a rise of 1.7%. GAAP working margin elevated to 18.1% in comparison with 18.0% within the prior yr.

Magnificence Methods Group

  • Section web gross sales had been $404.9 million within the quarter, a rise of 6.2% in comparison with the prior yr. The section had a positive influence from international forex translation of roughly 60 foundation factors on reported gross sales and operated 23 fewer shops on the finish of the quarter in comparison with the prior yr. Section e-commerce gross sales had been $42 million or 10.3% of section web gross sales for the quarter.
  • Section similar retailer gross sales elevated 1.7% within the fourth quarter.
  • On the finish of the quarter, web retailer rely was 1,362, a lower of 23 shops in comparison with the prior yr.
  • Gross margin decreased 50 foundation factors to 40.7% within the quarter, pushed primarily by a gross sales combine shift in the direction of giant quantity/decrease margin full service prospects that continued to rebound from the COVID-19 influence within the prior yr.
  • GAAP working earnings had been $53.4 million within the quarter, a rise of 5.4% in comparison with $50.6 million within the prior yr. GAAP working margin within the quarter was 13.2% in comparison with 13.3% within the prior yr.
  • On the finish of the quarter, there have been 719 distributor gross sales consultants in comparison with 715 within the prior yr.

Fiscal 12 months 2022 Steering

The Firm’s full yr steerage for fiscal yr 2022 is printed under and extra perspective can be supplied throughout the earnings convention name.

  • Web gross sales are anticipated to extend 3% to 4% in comparison with the prior yr;
  • Web retailer rely is predicted to lower by roughly 1% to 2% for the fiscal yr, reflecting the Firm’s give attention to optimizing its retailer portfolio;
  • Gross margin is predicted to broaden by 40 to 60 foundation factors in comparison with the prior yr;
  • GAAP working margin is predicted to extend by roughly 90 to 110 foundation factors in comparison with fiscal yr 2021; and
  • Adjusted Working Margin is predicted to be roughly flat in comparison with fiscal yr 2021.

Replace on Monetary Disclosures

Starting in fiscal 2022, the Firm can be changing the identical retailer gross sales metric with comparable gross sales, which can embrace gross sales from the complete service divisions and franchise operations, together with any associated e-commerce gross sales. In fiscal 2022, for every quarter the Firm will disclose each present and prior yr comparable gross sales below the brand new definition.

Convention Name and The place You Can Discover Further Info

The Firm will maintain a convention name and audio webcast in the present day to debate its monetary outcomes and its enterprise at roughly 7:30 a.m. Central Time in the present day, November 11, 2021. In the course of the convention name, the Firm might talk about and reply a number of questions regarding enterprise and monetary issues and developments affecting the Firm. The Firm’s responses to those questions, in addition to different issues mentioned throughout the convention name, might include or represent materials info that has not been beforehand disclosed. Simultaneous to the convention name, an audio webcast of the decision can be out there through a hyperlink on the Firm’s web site, sallybeautyholdings.com/investor-relations. The convention name might be accessed by dialing (844) 291-4185 (Worldwide: (409) 207-6997) and referencing the entry code 3661420#. The teleconference can be held in a “listen-only” mode for all individuals aside from the Firm’s present sell-side and buy-side funding professionals. As well as, a supplemental slide presentation could also be considered throughout the name on the following hyperlink SBH This autumn Earnings Presentation and getting into the occasion password Ke5Yd3Prgt8. A replay of the earnings convention name can be out there beginning at 10:30 a.m. Central Time, November 11, 2021, by means of November 25, 2021, by dialing (866) 207-1041 (Worldwide: (402) 970-0847) and referencing entry code 5241224#. Additionally, a web site replay can be out there on sallybeautyholdings.com/investor-relations.

About Sally Magnificence Holdings, Inc.

Sally Magnificence Holdings, Inc. (NYSE: SBH), because the chief in skilled hair shade, sells and distributes skilled magnificence provides globally by means of its Sally Magnificence Provide and Magnificence Methods Group companies. Sally Magnificence Provide shops provide as much as 7,000 merchandise for hair shade, hair care, nails, and skincare by means of proprietary manufacturers akin to Ion®, Generic Worth Merchandise®, Past the Zone® and Silk Components® in addition to skilled traces akin to Wella®, Clairol®, OPI®, Conair® and L’Oreal®. Magnificence Methods Group shops, branded as CosmoProf® or Armstrong McCall® shops, together with its exterior gross sales consultants, promote as much as 10,000 professionally branded merchandise together with Paul Mitchell®, Wella®, Matrix®, Schwarzkopf®, Kenra®, Goldwell®, Joico® and Olaplex®, supposed to be used in salons and for resale by salons to retail shoppers. For extra details about Sally Magnificence Holdings, Inc., please go to https://www.sallybeautyholdings.com/.

Cautionary Discover Concerning Ahead-Trying Statements

Statements on this information launch and the schedules hereto which aren’t purely historic information or which rely on future occasions could also be forward-looking statements throughout the that means of Part 27A of the Securities Act of 1933, as amended, and Part 21E of the Securities Trade Act of 1934, as amended. Ahead-looking statements, as that time period is outlined within the Non-public Securities Litigation Reform Act of 1995, might be recognized by means of forward-looking terminology akin to “believes,” “initiatives,” “expects,” “can,” “might,” “estimates,” “ought to,” “plans,” “targets,” “intends,” “might,” “will,” “would,” “anticipates,” “potential,” “assured,” “optimistic,” or the damaging thereof, or different variations thereon, or comparable terminology, or by discussions of technique, goals, estimates, steerage, expectations and future plans. Ahead-looking statements will also be recognized by the truth that these statements don’t relate strictly to historic or present issues.

Readers are cautioned to not place undue reliance on forward-looking statements as such statements converse solely as of the date they had been made. Any forward-looking statements contain dangers and uncertainties that might trigger precise occasions or outcomes to vary materially from the occasions or outcomes described within the forward-looking statements, together with, however not restricted to, the dangers and uncertainties associated to COVID-19 and people described in our filings with the Securities and Trade Fee, together with our Annual Report on Type 10-Okay for the yr ended September 30, 2020. Consequently, all forward-looking statements on this launch are certified by the elements, dangers and uncertainties contained therein. We assume no obligation to publicly replace or revise any forward-looking statements.

Use of Non-GAAP Monetary Measures

This information launch and the schedules hereto embrace the next monetary measures that haven’t been calculated in accordance with accounting ideas usually accepted in america, or GAAP, and are due to this fact known as non-GAAP monetary measures: (1) Adjusted Gross Margin; (2) Adjusted Promoting, Common and Administrative Bills; (3) Adjusted EBITDA and EBITDA Margin; (4) Adjusted Working Earnings and Working Margin; (5) Adjusted Web Earnings; (6) Adjusted Diluted Web Earnings Per Share; and (7) Working Free Money Circulation. We have now supplied definitions under for these non-GAAP monetary measures and have supplied tables within the schedules hereto to reconcile these non-GAAP monetary measures to the comparable GAAP monetary measures.

Adjusted Gross Margin – We outline the measure Adjusted Gross Margin as GAAP gross margin excluding the write-down of COVID-19 associated private protecting tools stock for the related time durations as indicated within the accompanying non-GAAP reconciliations to the comparable GAAP monetary measures.

Adjusted Promoting, Common and Administrative Bills – We outline the measure Adjusted Promoting, Common and Administrative Bills as GAAP promoting, basic and administrative bills excluding COVID-19 web bills for the related time durations as indicated within the accompanying non-GAAP reconciliations to the comparable GAAP monetary measures.

Adjusted EBITDA and EBITDA Margin – We outline the measure Adjusted EBITDA as GAAP web earnings earlier than depreciation and amortization, curiosity expense, earnings taxes, share-based compensation, prices associated to the Firm’s beforehand introduced restructuring plans, COVID-19 associated web bills, prices associated to the non-cash write down of stock, and impairment expenses associated to long-lived belongings and working lease belongings not included in restructuring for the related time durations as indicated within the accompanying non-GAAP reconciliations to the comparable GAAP monetary measures. Adjusted EBITDA Margin is Adjusted EBITDA as a share of web gross sales.

Adjusted Working Earnings and Working Margin – Adjusted working earnings are GAAP working earnings that exclude prices associated to the Firm’s beforehand introduced restructuring plans and web bills associated to COVID-19 for the related time durations as indicated within the accompanying non-GAAP reconciliations to the comparable GAAP monetary measures. Adjusted Working Margin is Adjusted Working Earnings as a share of web gross sales.

Adjusted Web Earnings – Adjusted web earnings is GAAP web earnings that exclude tax-effected prices associated to the Firm’s beforehand introduced restructuring plans and tax-effected web bills associated to COVID-19 for the related time durations as indicated within the accompanying non-GAAP reconciliations to the comparable GAAP monetary measures.

Adjusted Diluted Web Earnings Per Share – Adjusted diluted web earnings per share is GAAP diluted earnings per share that exclude tax-effected prices associated to the Firm’s beforehand introduced restructuring plans and tax-effected web bills associated to COVID-19 for the related time durations as indicated within the accompanying non-GAAP reconciliations to the comparable GAAP monetary measures.

Working Free Money Circulation – We outline the measure Working Free Money Circulation as GAAP web money supplied by working actions much less funds for capital expenditures (web). We consider Working Free Money Circulation is a vital liquidity measure that gives helpful info to traders about the amount of money generated from operations after considering funds for capital expenditures (web).

We consider that these non-GAAP monetary measures present priceless info relating to our earnings and enterprise developments by excluding particular objects that we consider usually are not indicative of the continuing working outcomes of our companies; offering a helpful method for traders to make a comparability of our efficiency over time and towards different firms in our trade.

We have now supplied these non-GAAP monetary measures as supplemental info to our GAAP monetary measures and consider these non-GAAP measures present traders with extra significant monetary info relating to our working efficiency and money flows. Our administration and Board of Administrators additionally use these non-GAAP measures as supplemental measures to judge our companies and the efficiency of administration, together with the willpower of performance-based compensation, to make working and strategic choices, and to allocate monetary assets. We consider that these non-GAAP measures additionally present significant info for traders and securities analysts to judge our historic and potential monetary efficiency. These non-GAAP measures shouldn’t be thought of an alternative choice to or superior to GAAP outcomes. Moreover, the non-GAAP measures offered by us is probably not similar to equally titled measures of different firms.

Supplemental Schedules

Section Info

1

Non-GAAP Monetary Measures Reconciliations

2-3

Non-GAAP Monetary Measures Reconciliations; Adjusted EBITDA and

 

Working Free Money Circulation

4

Retailer Depend and Similar Retailer Gross sales

5

SALLY BEAUTY HOLDINGS, INC. AND SUBSIDIARIES
Consolidated Statements of Earnings
(In 1000’s, besides per share information)
(Unaudited)
 
 
Three Months Ended September 30, Twelve Months Ended September 30,

2021

2020

Proportion
Change

2021

2020

Proportion
Change
 
Web gross sales

$

990,260

 

$

957,812

 

3.4

%

$

3,874,997

 

$

3,514,330

 

10.3

%

Value of merchandise bought

 

489,285

 

 

468,669

 

4.4

%

 

1,921,663

 

 

1,798,736

 

6.8

%

Gross revenue

 

500,975

 

 

489,143

 

2.4

%

 

1,953,334

 

 

1,715,594

 

13.9

%

Promoting, basic and administrative bills

 

386,542

 

 

366,982

 

5.3

%

 

1,530,280

 

 

1,442,809

 

6.1

%

Restructuring

 

3,240

 

 

2,484

 

30.4

%

 

4,611

 

 

14,025

 

(67.1

)%

Working earnings

 

111,193

 

 

119,677

 

(7.1

)%

 

418,443

 

 

258,760

 

61.7

%

Curiosity expense

 

20,196

 

 

28,310

 

(28.7

)%

 

93,509

 

 

98,793

 

(5.3

)%

Earnings earlier than provision for earnings taxes

 

90,997

 

 

91,367

 

(0.4

)%

 

324,934

 

 

159,967

 

103.1

%

Provision for earnings taxes

 

22,848

 

 

21,179

 

7.9

%

 

85,076

 

 

46,722

 

82.1

%

Web earnings

$

68,149

 

$

70,188

 

(2.9

)%

$

239,858

 

$

113,245

 

111.8

%

 
Earnings per share:
Fundamental

$

0.60

 

$

0.63

 

(4.8

)%

$

2.13

 

$

0.99

 

115.2

%

Diluted

$

0.59

 

$

0.62

 

(4.8

)%

$

2.10

 

$

0.99

 

112.1

%

 
Weighted common shares:
Fundamental

 

112,797

 

 

112,296

 

 

112,653

 

 

113,881

 

Diluted

 

114,565

 

 

113,090

 

 

114,212

 

 

114,680

 

Foundation Level
Change
Foundation Level
Change
Comparability as a share of web gross sales
Consolidated gross margin

 

50.6

%

 

51.1

%

(50

)

 

50.4

%

 

48.8

%

160

 

Promoting, basic and administrative bills

 

39.0

%

 

38.3

%

70

 

 

39.5

%

 

41.1

%

(160

)

Consolidated working margin

 

11.2

%

 

12.5

%

(130

)

 

10.8

%

 

7.4

%

340

 

 
Efficient tax fee

 

25.1

%

 

23.2

%

190

 

 

26.2

%

 

29.2

%

(300

)

 
SALLY BEAUTY HOLDINGS, INC. AND SUBSIDIARIES
Condensed Consolidated Stability Sheets
(In 1000’s)
(Unaudited)
 
September 30,

2021

2020

 
Money and money equivalents

$

400,959

$

514,151

Commerce and different accounts receivable

 

66,581

 

56,429

Stock

 

871,349

 

814,503

Different present belongings

 

44,686

 

48,014

Whole present belongings

 

1,383,575

 

1,433,097

Property and tools, web

 

307,377

 

315,029

Working lease asset

 

537,673

 

525,634

Goodwill and different intangible belongings

 

596,741

 

598,321

Different belongings

 

21,766

 

23,066

Whole belongings

$

2,847,132

$

2,895,147

 
Present maturities of long-term debt

$

194

$

180

Accounts payable

 

291,632

 

236,333

Accrued liabilities

 

206,155

 

170,665

Present working lease liabilities

 

156,234

 

153,267

Earnings taxes payable

 

10,666

 

2,917

Whole present liabilities

 

664,881

 

563,362

Lengthy-term debt

 

1,382,530

 

1,796,897

Lengthy-term working lease liabilities

 

404,147

 

394,375

Different liabilities

 

29,056

 

32,976

Deferred earnings tax liabilities, web

 

85,777

 

92,094

Whole liabilities

 

2,566,391

 

2,879,704

Whole stockholders’ fairness

 

280,741

 

15,443

Whole liabilities and stockholders’ fairness

$

2,847,132

$

2,895,147

 
 

Supplemental Schedule 1

 
SALLY BEAUTY HOLDINGS, INC. AND SUBSIDIARIES
Section Info
(In 1000’s)
(Unaudited)
 
 
Three Months Ended September 30, Twelve Months Ended September 30,

2021

2020

Proportion

Change

2021

2020

Proportion
Change
Web gross sales:
Sally Magnificence Provide (“SBS”)

$

585,367

 

$

576,578

 

1.5

%

$

2,278,382

 

$

2,080,703

 

9.5

%

Magnificence Methods Group (“BSG”)

 

404,893

 

 

381,234

 

6.2

%

 

1,596,615

 

 

1,433,627

 

11.4

%

Whole web gross sales

$

990,260

 

$

957,812

 

3.4

%

$

3,874,997

 

$

3,514,330

 

10.3

%

 
Working earnings:
SBS

$

105,683

 

$

103,904

 

1.7

%

$

417,658

 

$

237,588

 

75.8

%

BSG

 

53,398

 

 

50,649

 

5.4

%

 

205,078

 

 

194,206

 

5.6

%

Section working earnings

 

159,081

 

 

154,553

 

2.9

%

 

622,736

 

 

431,794

 

44.2

%

 
Unallocated bills (1)

 

44,648

 

 

32,392

 

37.8

%

 

199,682

 

 

159,009

 

25.6

%

Restructuring

 

3,240

 

 

2,484

 

30.4

%

 

4,611

 

 

14,025

 

(67.1

)%

Curiosity expense

 

20,196

 

 

28,310

 

(28.7

)%

 

93,509

 

 

98,793

 

(5.3

)%

Earnings earlier than provision for earnings taxes

$

90,997

 

$

91,367

 

(0.4

)%

$

324,934

 

$

159,967

 

103.1

%

 
 
Section gross margin:

2021

2020

Foundation Level
Change

2021

2020

Foundation Level
Change
SBS

 

57.5

%

 

57.6

%

(10

)

 

57.9

%

 

54.4

%

350

 

BSG

 

40.7

%

 

41.2

%

(50

)

 

39.8

%

 

40.7

%

(90

)

 
Section working margin:
SBS

 

18.1

%

 

18.0

%

10

 

 

18.3

%

 

11.4

%

690

 

BSG

 

13.2

%

 

13.3

%

(10

)

 

12.8

%

 

13.5

%

(70

)

Consolidated working margin

 

11.2

%

 

12.5

%

(130

)

 

10.8

%

 

7.4

%

340

 

 
 
 
(1) Unallocated bills, together with share-based compensation expense, include company and shared prices and are included in promoting, basic and administrative bills.
 
Supplemental Schedule 2
 
SALLY BEAUTY HOLDINGS, INC. AND SUBSIDIARIES
Non-GAAP Monetary Measures Reconciliations
(In 1000’s, besides per share information)
(Unaudited)
 
 
Three Months Ended September 30, 2021
As Reported Restructuring (1) COVID-19 (2) As Adjusted
(Non-GAAP)
 
Value of merchandise bought

$

489,285

 

$

(1,444

)

$

 

$

487,841

 

Consolidated gross margin

 

50.6

%

 

50.7

%

Promoting, basic and administrative bills

 

386,542

 

 

 

 

86

 

 

386,628

 

SG&A bills, as a share of gross sales

 

39.0

%

 

39.0

%

Working earnings

 

111,193

 

 

4,684

 

 

(86

)

 

115,791

 

Working margin

 

11.2

%

 

11.7

%

Earnings earlier than provision for earnings taxes

 

90,997

 

 

4,684

 

 

(86

)

 

95,595

 

Provision for earnings taxes (3)

 

22,848

 

 

376

 

 

(738

)

 

22,486

 

Web earnings

$

68,149

 

$

4,308

 

$

652

 

$

73,109

 

 
Earnings per share:
Fundamental

$

0.60

 

$

0.04

 

$

0.01

 

$

0.65

 

Diluted

$

0.59

 

$

0.04

 

$

0.01

 

$

0.64

 

 
Three Months Ended September 30, 2020
As Reported Restructuring (1) COVID-19 (2) As Adjusted
(Non-GAAP)
 
Value of merchandise bought

$

468,669

 

$

 

$

 

$

468,669

 

Consolidated gross margin

 

51.1

%

 

51.1

%

Promoting, basic and administrative bills

 

366,982

 

 

 

 

1,872

 

 

368,854

 

SG&A bills, as a share of gross sales

 

38.3

%

 

38.5

%

Working earnings

 

119,677

 

 

2,484

 

 

(1,872

)

 

120,289

 

Working margin

 

12.5

%

 

12.6

%

Earnings earlier than provision for earnings taxes

 

91,367

 

 

2,484

 

 

(1,872

)

 

91,979

 

Provision for earnings taxes (3)

 

21,179

 

 

584

 

 

(502

)

 

21,261

 

Web earnings

$

70,188

 

$

1,900

 

$

(1,370

)

$

70,718

 

 
Earnings per share:
Fundamental

$

0.63

 

$

0.02

 

$

(0.01

)

$

0.63

 

Diluted

$

0.62

 

$

0.02

 

$

(0.01

)

$

0.63

 

 
 
(1) For the three months ended September 30, 2021, restructuring represents bills incurred primarily in reference to the Transformation Plan, together with $1.4 million associated to stock. For the three months ended September 30, 2020, restructuring represents bills incurred primarily in reference to Undertaking Surge and the Transformation Plan.
 
(2) For the three months ended September 30, 2021, COVID-19 primarily represents a hire subsidy supplied by the Canadian authorities and extra tax influence from the donation of personal-protective tools. For the three months ended September 30, 2020, COVID-19 primarily represents a wage subsidy supplied by the Canadian authorities below the Canada Emergency Wage Subsidy.
 
(3) The availability for earnings taxes was calculated utilizing the relevant tax charges for every nation, whereas excluding the tax advantages for international locations the place the tax profit is just not at present deemed possible of being realized.
 
Supplemental Schedule 3
 
SALLY BEAUTY HOLDINGS, INC. AND SUBSIDIARIES
Non-GAAP Monetary Measures Reconciliations, Continued
(In 1000’s, besides per share information)
(Unaudited)
 
 
Twelve Months Ended September 30, 2021
As Reported Restructuring (1) COVID-19 (2) As Adjusted
(Non-GAAP)
 
Value of merchandise bought

$

1,921,663

 

$

(1,444

)

$

(6,957

)

$

1,913,262

 

Consolidated gross margin

 

50.4

%

 

50.6

%

Promoting, basic and administrative bills

 

1,530,280

 

 

 

 

(29,667

)

 

1,500,613

 

SG&A bills, as a share of gross sales

 

39.5

%

 

38.7

%

Working earnings

 

418,443

 

 

6,055

 

 

36,624

 

 

461,122

 

Working margin

 

10.8

%

 

11.9

%

Earnings earlier than provision for earnings taxes

 

324,934

 

 

6,055

 

 

36,624

 

 

367,613

 

Provision for earnings taxes (3)

 

85,076

 

 

640

 

 

7,910

 

 

93,626

 

Web earnings

$

239,858

 

$

5,415

 

$

28,714

 

$

273,987

 

 
Earnings per share:
Fundamental

$

2.13

 

$

0.05

 

$

0.25

 

$

2.43

 

Diluted

$

2.10

 

$

0.05

 

$

0.25

 

$

2.40

 

 
Twelve Months Ended September 30, 2020
As Reported Restructuring (1) COVID-19 (2) As Adjusted
(Non-GAAP)
 
Value of merchandise bought

$

1,798,736

 

$

 

$

 

$

1,798,736

 

Consolidated gross margin

 

48.8

%

 

48.8

%

Promoting, basic and administrative bills

 

1,442,809

 

 

 

 

(21,578

)

 

1,421,231

 

SG&A bills, as a share of gross sales

 

41.1

%

 

40.4

%

Working earnings

 

258,760

 

 

14,025

 

 

21,578

 

 

294,363

 

Working margin

 

7.4

%

 

8.4

%

Earnings earlier than provision for earnings taxes

 

159,967

 

 

14,025

 

 

21,578

 

 

195,570

 

Provision for earnings taxes (3)

 

46,722

 

 

3,551

 

 

5,183

 

 

55,456

 

Web earnings

$

113,245

 

$

10,474

 

$

16,395

 

$

140,114

 

 
Earnings per share:
Fundamental

$

0.99

 

$

0.09

 

$

0.14

 

$

1.23

 

Diluted

$

0.99

 

$

0.09

 

$

0.14

 

$

1.22

 

 
 
 
 
(1) For fiscal yr 2021, restructuring represents bills incurred primarily in reference to Undertaking Surge and the Transformation Plan, together with the write-down of stock of $1.4 million in value of merchandise bought. For fiscal yr 2020, restructuring represents bills incurred primarily in reference to Undertaking Surge and the Transformation Plan.
 
(2) For fiscal yr 2021, COVID-19 bills primarily represents the write-down of personal-protective tools stock of $7.0 million in value of merchandise bought and donation expense associated to the personal-protective tools stock of $33.0 million in promoting, basic, and administrative bills, partially offset by wage and hire subsidies supplied by the Canadian authorities of $3.4 million. For fiscal yr 2020, COVID-19 primarily represents prices related to catastrophe pay and furloughed staff in response to the coronavirus pandemic. These value had been partially offset by an worker retention payroll tax credit score supplied by the U.S. Coronavirus Help, Reduction, and Financial Safety Act, or CARES Act, and the Canada Emergency Wage Subsidy supplied by the Canadian authorities.
 
(3) The availability for earnings taxes was calculated utilizing the relevant tax charges for every nation upon the popularity of bills or positive factors, whereas excluding the tax advantages for international locations the place the tax profit is just not at present deemed possible of being realized.
 

Supplemental Schedule 4

 
SALLY BEAUTY HOLDINGS, INC. AND SUBSIDIARIES
Non-GAAP Monetary Measures Reconciliations, Continued
(In 1000’s)
(Unaudited)
 
 
Three Months Ended September 30, Twelve Months Ended September 30,
Adjusted EBITDA:

2021

2020

Proportion
Change

2021

2020

Proportion
Change
 
Web earnings

$

68,149

 

$

70,188

 

(2.9

)%

$

239,858

 

$

113,245

 

111.8

%

Add:

 

 

 

 

Depreciation and amortization

 

24,111

 

 

25,950

 

(7.1

)%

 

102,201

 

 

106,779

 

(4.3

)%

Curiosity expense

 

20,196

 

 

28,310

 

(28.7

)%

 

93,509

 

 

98,793

 

(5.3

)%

Provision for earnings taxes

 

22,848

 

 

21,179

 

7.9

%

 

85,076

 

 

46,722

 

82.1

%

EBITDA (non-GAAP)

 

135,304

 

 

145,627

 

(7.1

)%

 

520,644

 

 

365,539

 

42.4

%

Stock expenses (1)

 

 

 

 

 

 

 

 

27,054

 

(100.0

)%

COVID-19

 

(86

)

 

(1,872

)

(95.4

)%

 

36,624

 

 

21,578

 

69.7

%

Restructuring

 

4,684

 

 

2,484

 

88.6

%

 

6,055

 

 

14,025

 

(56.8

)%

Share-based compensation

 

3,498

 

 

(668

)

(623.7

)%

 

11,656

 

 

8,426

 

38.3

%

Impairment (2)

 

 

 

982

 

(100.0

)%

 

 

 

1,883

 

(100.0

)%

Adjusted EBITDA (non-GAAP)

$

143,400

 

$

146,553

 

(2.2

)%

$

574,979

 

$

438,505

 

31.1

%

 
Foundation Level
Change
Foundation Level
Change
Adjusted EBITDA as a share of web gross sales
Adjusted EBITDA margin

 

14.5

%

 

15.3

%

(80

)

 

14.8

%

 

12.5

%

230

 

 
 
Working Free Money Circulation:

2021

2020

Proportion
Change

2021

2020

Proportion
Change
Web money supplied by working actions

$

164,132

$

152,505

7.6

%

$

381,860

$

426,889

 

(10.5

)%

Much less:
Funds for property and tools, web

 

28,770

 

21,103

36.3

%

 

73,669

 

110,805

(33.5

)%

Working free money circulation (non-GAAP)

$

135,362

$

131,402

3.0

%

$

308,191

$

316,084

(2.5

)%

 
(1) Incremental, non-cash write down of stock as a part of aggressive tactical stock clearance actions.
(2) Impairment expenses associated to long-lived belongings and working lease belongings exterior of restructuring.
 
Supplemental Schedule 5
 
SALLY BEAUTY HOLDINGS, INC. AND SUBSIDIARIES
Retailer Depend and Similar Retailer Gross sales
(Unaudited)
 
 
As of September 30,

2021

2020

Change
 
Variety of shops:
SBS:
Firm-operated shops

3,547

3,644

(97

)

Franchise shops

2

9

(7

)

Whole SBS

3,549

3,653

(104

)

BSG:
Firm-operated shops

1,230

1,251

(21

)

Franchise shops

132

134

(2

)

Whole BSG

1,362

1,385

(23

)

Whole consolidated

4,911

5,038

(127

)

 
Variety of BSG distributor gross sales consultants

719

715

4

 

 
BSG distributor gross sales consultants (DSC) embrace 194 and 183 gross sales consultants employed by our franchisees at September 30, 2021 and 2020, respectively.
Three Months Ended September 30, Twelve Months Ended September 30,

2021

2020

Foundation Level Change

2021

2020

Foundation Level Change
Similar retailer gross sales progress (decline):
SBS

2.3

%

1.7

%

60

9.7

%

(8.1

)%

1,780

BSG

1.7

%

0.6

%

110

11.0

%

(8.3

)%

1,930

Consolidated

2.1

%

1.3

%

80

10.2

%

(8.1

)%

1,830

 
 
For the aim of calculating our similar retailer gross sales metrics, we evaluate the present interval gross sales for shops open for 14 months or longer as of the final day of a month with the gross sales for these shops for the comparable interval within the prior fiscal yr. Our similar retailer gross sales are calculated in fixed U.S. {dollars} and embrace e-commerce gross sales, however don’t usually embrace the gross sales from shops relocated till 14 months after the relocation. The gross sales from shops acquired are excluded from our similar retailer gross sales calculation till 14 months after the acquisition.

 



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