Sally Beauty Supply continued its steady growth and enjoyed improving profit margins expanding to 2,389 stores in North America (including Canada and Mexico), the United Kingdom, Germany and Japan, while Beauty Systems Group (BSG) ended the quarter with 817 stores and 1,274 professional distributor sales consultants.
"As expected, BSG continued to be negatively affected by several factors including the loss of sales and sales force disruption resulting from certain full service product line distribution changes in the United States, as well as acquisition and integration costs related to recent CosmoProf and West Coast Beauty Supply purchases."
"In spite of all of this, BSG, while posting lower profits than last year, was able to record higher operating margins and profits in the third quarter versus the 2005 second quarter by focusing its efforts on overcoming these temporary disruptions. They believe BSG will continue to expand their operating margins over the next several years," added Mr. Bernick.
Also announced today, the Company's board of directors approved the regular 11.5 cent quarterly cash dividend. The dividend will be paid on August 19, 2005 to shareholders of record on August 8, 2005.
Generally accepted accounting principles (GAAP) require that the Company record a non-cash charge in the current quarter against pre-tax earnings of $3.7 million ($2.4 million after tax), due to the remeasurement of the intrinsic value of stock options affected by the November, 2003 conversion to a single class of common stock. In fiscal year 2004, the non-cash charge reduced pre-tax earnings in the third quarter by $7.8 million ($5.1 million after tax). These non-cash charges relate only to the conversion and had no effect on the sales, operating profits or cash flows of the Company's business units or on the consolidated sales and cash flows of the Company.
20240830145952.gif)
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "UBM China (Shanghai)")
-Ltd..jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Thermore (Far East) Ltd.")
