Net sales dipped at Sally Beauty Holdings in its first fiscal quarter, dented in part by fall hurricanes.
The retailer posted $995 million in net sales for the first year, a 0.5 percent year-over-year decline. Same-store sales were down 2.2 percent in the 12-month period. Hurricanes affected the company’s business, particularly in Puerto Rico, where the company said the effect on growth was 40 basis points.
Net earnings swelled 49.1 percent to $83.3 million from $55.8 million. Earnings per share rose to 65 cents. These figures were affected by U.S. Tax Reform.
“Consistent with our expectations, this was a challenging quarter in terms of revenue growth. Business in the first quarter was impacted by a continuation of disappointing traffic trends in our U.S. Sally Beauty stores, an additional day of store closures versus the prior year for our Beauty Systems Group Cosmoprof stores due to the holiday calendar and the residual impact of Hurricane Maria in Puerto Rico. However, we were pleased to have exceeded our expectations for both reported and adjusted diluted earnings per share, even after excluding the net benefits from U.S. Tax Reform,” said Chris Brickman, president and chief executive officer. “Modest declines in consolidated net sales and gross margin were offset by benefits from our 2017 Restructuring Plan, tight control of discretionary expenses and lower interest expense.”
The company also said that during the quarter it acquired a Canadian distributor, expanding the footprint of its Beauty Systems Group. In stores, Sally is testing its loyalty program and its exclusive lines, like Cololab, and focusing on the categories it is best-known for — hair color and hair care.
Sally is projecting flat sales growth for the fiscal year.