A noncash aftertax impairment charge of $23.4 million related to its salon division dropped Regis Corp. to a $64,000 loss during the third quarter ended March 31.
This story first appeared in the April 29, 2010 issue of WWD. Subscribe Today.
The results, breakeven on a per-share basis, compare with net income of $8.9 million, or 21 cents a diluted share, in the year-ago period. Excluding the onetime item, earnings per share in the 2010 quarter were 37 cents, beating by 5 cents the average expectations of analysts.
The firm reported on April 8 that revenues in the quarter declined 2.7 percent to $587.6 million from $604.1 million. Same-store sales declined 1.8 percent.
However, Paul D. Finkelstein, chairman and chief executive officer, called March “our best month in a long time with flat North American same-store sales.” He noted that Regis’ value-priced concepts are performing better than its higher-priced point Regis division.
Still, he warned that recovery would be “slow” with same-store sales for next year in the range of down 1 percent to up 2 percent.
During the fiscal year to date, profits came in at $25.9 million, or 46 cents a share, compared with a loss of $119.9 million, $2.79 a share, in the same nine-month period ended in 2009. Sales receded 2 percent to $1.77 billion from $1.81 billion.
As of March 31, Regis Corp. owned, franchised or held ownership interest in 12,748 worldwide locations, a 1.4 percent decline from a year ago. The firm plans to build 160 new salon locations during fiscal 2011.