Regis (RGS) - 2025 Q1 - Quarterly Report

Company Operations - As of September 30, 2024, Regis Corporation operated 4,359 locations, including 4,350 franchised salons and 9 company-owned salons[78]. Financial Performance - System-wide revenue for the three months ended September 30, 2024, was $285.6 million, a decrease of 6.5$306.6 million in the same period of 2023[84]. - Total system-wide same-store sales decreased by 1.1% for the three months ended September 30, 2024, compared to an increase of 1.8% in the same period of 2023[84]. - Royalties decreased by $0.9 million, or 5.5$6.1 million to $45.3 million for the three months ended September 30, 2024, compared to$51.4 million in the same period of 2023[102]. - Franchise same-store sales declined by 1.2% for the three months ended September 30, 2024, compared to an increase of 1.7% in the prior year[102]. - Franchise adjusted EBITDA totaled $8.0 million, a decrease of$0.6 million from $8.6 million in the same period of 2023[103]. - Company-owned salon revenue decreased by$1.1 million, or 59.5%, due to a reduction in company-owned salon count[91]. - Company-owned salon revenue decreased by $1.1 million to$1.9 million for the three months ended September 30, 2024, primarily due to a decrease in salon count[106]. Expenses and Costs - General and administrative expenses increased by $3.3 million, or 30.8$2.3 million and stock-based compensation[92]. - Interest expense decreased by $1.4 million, primarily due to less debt outstanding compared to the same period in 2023[95]. Cash and Debt Management - As of September 30, 2024, cash and cash equivalents were$6.3 million, with $5.4 million in the United States and$0.9 million in Canada[110]. - The company's total debt to capitalization ratio was 66.2% as of September 30, 2024, down from 67.0% in June 2024[119]. - Cash used in operating activities improved to $1.3 million for the three months ended September 30, 2024, compared to$2.8 million in the same period of 2023[116]. - The company has a $25.0 million revolving credit facility that matures in June 2029, with$15.7 million of unused available credit as of September 30, 2024[111]. Tax and Income - The effective tax rate for the three months ended September 30, 2024, was 11.1%, compared to (14.1)% in the same period of 2023[97]. - Income from discontinued operations increased by $1.0 million, primarily due to proceeds from the sale of OSP related to salons migrating to the Zenoti platform[98]. Future Expectations - The company expects additional proceeds of approximately$7.0 to $7.5 million from the sale of its OSP software-as-a-service solution in fiscal year 2025[112]. - No shares were repurchased during the three months ended September 30, 2024, with approximately 1.5 million shares repurchased cumulatively for$595.4 million[121].