Global leader in the $150 billion hair care industry, Regis Corporation reported financial results for its fiscal first quarter ended September 30, 2005.
Consolidated revenues increased 15 percent to a record $584 million compared to $506 million a year ago. Same-store sales increased 0.7 percent. First quarter revenue and same-store sales results met the low end of the Company's guidance. Net income decreased 12 percent to $22.2 million, or $0.48 per diluted share. First quarter earnings fell $0.03 per diluted share below the low end of the Company's guidance due exclusively to Hurricanes Katrina and Rita.
Hurricanes Katrina and Rita resulted in salon closures as residents evacuated communities in the storms' paths. The Company estimates that these closures reduced first quarter revenue by $2.1 million. In addition, Regis Corporation wrote off $450,000 of equipment and leasehold improvements, primarily associated with the destruction of seven corporate salons.
Finally, Regis Corporation came to the aid of its employees and the communities they serve by providing disaster pay to its stylists in the affected areas and donating $200,000 of professional hair care product, which was distributed to residents in need. In total, Hurricanes Katrina and Rita reduced first quarter earnings per diluted share by $0.03.
Regis Corporation ended the quarter with 11,077 worldwide locations, a net increase of 84 units during the quarter. The Company constructed 125 salons and franchisees built 57 salons. In addition, Regis acquired 48 salons (including 42 salon franchise buybacks) and 11 beauty schools. The Company closed or relocated 115 corporate and franchise salons during the quarter.
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