Regis Corp (RGS) Q3 2025 Earnings Call Highlights: Strong EBITDA Growth Amidst Sales Challenges

GuruFocus News

Wed, May 14, 2025, 2:01 PM 3 min read

Release Date: May 13, 2025

For the implicit transcript of the net call, delight notation to the full net telephone transcript.

• Regis Corp (NASDAQ:RGS) reported a 33% maturation successful adjusted EBITDA and a 23% summation successful operating income compared to the erstwhile year.

• The institution has returned to profitability and is consistently generating affirmative operating currency flow.

• The acquisition of Allied Salon Group has expanded maturation and currency procreation opportunities, contributing positively to results.

• Regis Corp (NASDAQ:RGS) has implemented a caller wage program and pricing structure, which has shown aboriginal affirmative results successful same-store sales.

• The SuperCuts rewards loyalty programme is driving accrued income and lawsuit retention, with rewards members accounting for implicit 30% of full sales.

• Consolidated same-store income saw a humble diminution of 1.1% for the 3rd fiscal quarter.

• The institution experienced a diminution successful franchise revenues owed to the closure of unprofitable franchise locations.

• SmartStyle marque saw a important 7.4% same-store income diminution for the quarter.

• Regis Corp (NASDAQ:RGS) is inactive facing challenges successful expanding postulation to salons, particularly caller impermanent visits.

• The institution had 49 nett closures of underperforming stores during the 3rd quarter.

• Warning! GuruFocus has detected 9 Warning Signs with RGS.

Q: Can you elaborate connected the strategical rationale down the acquisition of Allied Salon Group? A: Matthew Doctor, President and CEO, explained that the acquisition was a proactive strategy by Regis to heighten fiscal and strategical benefits. It expands maturation and currency procreation levers, opens caller marque and operational betterment opportunities, and has positively contributed to results instantly upon closing.

Q: What were the main factors contributing to the 1.1% diminution successful same-store income for the 3rd quarter? A: Matthew Doctor noted that the diminution was influenced by the timing of Easter, which fell successful the 4th fiscal quarter, and continued softness successful wide salon postulation and caller impermanent visits. The Easter timing displacement had an estimated antagonistic interaction of 1.1% connected sales.

Q: How is the caller wage program for stylists expected to interaction the business? A: Matthew Doctor highlighted that the caller wage program is designed to beryllium much transparent and amended align incentives, providing a wide way for managers and stylists to gain much by generating much work and retail sales. This inaugural is portion of broader strategical changes aimed astatine improving profitability and operational efficiency.