Regis Corp. (RGS) Posts Surprise Q4 Loss

Regis Corp. (NYSE: RGS) reported Q4 EPS of ($0.10), $0.14 worse than the analyst estimate of $0.04. Revenue for the quarter came in at $483.9 million versus the consensus estimate of $477.5 million.

Same-store sales declined 1.8%.

Dan Hanrahan, President and Chief Executive Officer commented, “During the last earnings call I outlined the path we have taken since joining Regis in August, 2012. I highlighted there was, and still is, a clear need for transformational change to lay the foundation for the turnaround. I also said, although early, we are seeing the first signs of transitioning from disruption to execution. During our fourth quarter we saw additional movement toward execution as our best operators continued to make progress. Consolidated same-store service sales declined 0.2% in the fourth quarter. Across the board, a greater percentage of our field leaders posted positive same-store service sales during the fourth quarter than in any previous quarter during the fiscal year. Where we have effective leaders using processes and metrics to drive results, we are beginning to win. While these early signs of transformation are encouraging, significant work is ahead of us before we achieve similar results across 7,000 salons.”

Mr. Hanrahan continued, “Our strategy, dedicated to making it easy for stylists to succeed, so they can provide an experience that creates guests for life, is beginning to take hold. However, we are still early on the transitional path of continuous improvement focused on people, process and metrics. While our same-store service sales were near flat, we did benefit from a late Easter. In addition, we still have too wide a range in performance across our salon base. A significant number of salons have yet to see traction and continue to comp negatively. Additionally, during the fourth quarter our same store retail sales were down 8.4%. I am cautiously encouraged by early signs of improvement, however, all of us at Regis understand how much work we still have to do.”

For earnings history and earnings-related data on Regis Corp. (RGS) click here.

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