Sally Beauty first-quarter sales fall 2.4% on store closures
Professional hair and beauty supply company Sally Beauty Holdings Inc. announced on Thursday net sales of $957 million for the first quarter ended December 31, down 2.4% compared to the prior year, driven primarily by store closures and unfavorable foreign exchange impact.
The Denton, Texas-based company said comparable sales increased 1.1%, while global e-commerce sales equally climbed 14% to $91 million, representing 9.5% of net sales in the quarter. It was operating 395 fewer stores at the end of the quarter compared to the prior year.
The company's earnings for the quarter were $50.3 million, or $0.46 per diluted share, compared to net earnings of $68.8 million, or $0.60 per diluted share in the prior year.
The company's Sally Beauty Supply sales were $549.5 million in the quarter, a decrease of 2.1% compared to the prior year. Meanwhile, its Beauty Systems Group sales were $407.6 million in the quarter, also down 2.7% compared to the prior year.
“We are pleased with our first quarter results, which reflect strong execution from our teams and a continuing focus on our strategic initiatives designed to inspire a more colorful, confident and welcoming world,” said Denise Paulonis, president and chief executive officer.
“During the first quarter, we delivered net sales of $957 million, Adjusted Gross Margin of 51% and Adjusted EBITDA of $126 million. In addition, we successfully implemented our distribution center consolidation and store optimization plan, furthering our goal to maximize the value of our large real estate portfolio, optimize our supply chain and provide a seamless omni-channel experience to our customers.”
Looking ahead, comparable sales are expected to increase by low single digits compared to the prior year, while net sales are expected to decline by low-single digits compared to the prior year.
“As we execute on our growth agenda, we remain focused on serving our customers and bringing a heightened level of education, expertise, innovation and services to both our Sally and BSG businesses. We remain confident that our initiatives will enable us to drive long-term growth and shareholder value,” added Paulonis.
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