Sally Beauty Holdings Inc. posted flat sales and decreased earnings for the third quarter.
The company’s net earnings were down 2 percent in the quarter, to $66.5 million from $67.9 million. Net sales were flat from the prior-year period, at $998 million. Diluted earnings per share were up 6.5 percent year-over-year, to 49 cents.
For the quarter, Sally Beauty Supply sales were $594.9 million, down 1.3 percent year-over-year, while the Beauty Systems Group posted $403.2 million in net sales, up 1.9 percent from the prior-year period.
The company said that incremental sales from new stores were partially offset by foreign currency translation, which impacted revenue growth by $10.2 million.
“We are pleased to report solid third quarter results, with improved revenue performance, excellent gross margin expansion and meaningful growth in adjusted earnings per share,” said Chris Brickman, Sally Beauty Holding’s president and chief executive officer. “Our results reflect a balanced approach to managing our business in a challenging retail environment, combining appropriate long-term strategic investments with an unrelenting focus on operating discipline and organizational efficiencies.
“Our effort to position the company for better financial performance extends to our capital structure,” Brickman continued. “As we announced shortly after quarter end, we refinanced $850 million of our long-term debt in early July by redeeming higher cost senior notes with funds generated from a new, lower cost institutional term loan, a move that should generate a significant reduction in annual cash interest expense.”
Sally Beauty is maintaining its guidance of flat full-year consolidated same-store sales growth, and now expects full-year net new store growth of about 1.5 percent.