Sally Beauty’s sales and earnings dipped in its second quarter.
The results come just three days after Sharon Leite, president of Sally Beauty U.S. and Canada, informed the company of her resignation. Chris Brickman, president and chief executive officer of the business, has assumed Leite’s U.S. and Canadian responsibilities while the company looks for a successor.
For the quarter, Sally reported net earnings of almost $57 million, down about 5.3 percent from the prior-year period’s $60.2 million. Net sales were down about 1.4 percent to $966.5 million, from $980.1 million. Adjusted diluted earnings per share were 44 cents, up 7.3 percent from the prior-year period.
Sally Beauty Supply posted $576 million in sales for the quarter, down 2.9 percent. The company said the numbers were hurt by the effects of foreign currency as well as a 2.4 percent drop in same-store sales. The chain increased its store count by 106 in the quarter.
Beauty Systems Group posted sales of $390.5 million for the quarter, up almost 1 percent, driven by growth in full service sales. Store count was up 34, to 1,346.
“Store traffic was especially challenging in January and February, but improved in the last month of the quarter,” Brickman said. “Additionally, revenue performance in April – the first month of our third fiscal quarter – was in line with the expectations that are included in the full year revenue guidance being communicated today. We are focused on ‘controlling the things we can control’ and, most importantly, on profitable growth.”
For the full year, Sally expects sales to be flat. The company said it expects gross margin expansion of 20 to 30 basis points, operating income growth in the low- to mid-single digits and capital expenditures of between $115 million and $120 million.