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Sally Beauty (SBH)

Sally Beauty Holdings, Inc. is an international specialty retailer and distributor of professional beauty supplies with revenues of approximately $3.9 billion annually. Through the Sally Beauty Supply and Beauty Systems Group businesses, the Company sells and distributes through 5,062 stores, including 158 franchised units, and has operations throughout the United States, Puerto Rico, Canada, Mexico, Chile, Peru, the United Kingdom, Ireland, Belgium, France, the Netherlands, Spain and Germany. Sally Beauty Supply stores offer up to 8,000 products for hair color, hair care, skin care, and nails through proprietary brands such as Ion®, Generic Value Products®, Beyond the Zone® and Silk Elements® as well as professional lines such as Wella®, Clairol®, OPI®, Conair® and Hot Shot Tools®. Beauty Systems Group stores, branded as CosmoProf® or Armstrong McCall® stores, along with its outside sales consultants, sell up to 10,500 professionally branded products including Paul Mitchell®, Wella®, Matrix®, Schwarzkopf®, Kenra®, Goldwell®, Joico® and CHI®, intended for use in salons and for resale by salons to retail consumers.

Company profile

Ticker
SBH
Exchange
CEO
Christian Brickman
Employees
Location
Fiscal year end
Former names
New Sally Holdings, Inc.
SEC CIK
Subsidiaries
Arcadia Beauty Labs LLC • Armstrong McCall Holdings, Inc. • Armstrong McCall Holdings, L.L.C. • Armstrong McCall, L.P. • Beauty Holding LLC • Beauty Systems Group • Beauty Systems Group LLC • BSG Canada Holdings Company • Diorama Services Company, LLC • Gen X Beauty LLC ...
IRS number
362257936

SBH stock data

Analyst ratings and price targets

Last 3 months

Calendar

4 Aug 22
28 Sep 22
30 Sep 22
Quarter (USD) Jun 22 Mar 22 Dec 21 Sep 21
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Annual (USD) Sep 21 Sep 20 Sep 19 Sep 18
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Cash burn rate (est.) Burn method: Change in cash Burn method: Operating income Burn method: FCF (opex + capex)
Last Q Avg 4Q Last Q Avg 4Q Last Q Avg 4Q
Cash on hand (at last report) 101.32M 101.32M 101.32M 101.32M 101.32M 101.32M
Cash burn (monthly) 42.03M 14.08M (no burn) (no burn) (no burn) (no burn)
Cash used (since last report) 124.3M 41.65M n/a n/a n/a n/a
Cash remaining -22.98M 59.67M n/a n/a n/a n/a
Runway (months of cash) -0.5 4.2 n/a n/a n/a n/a

Beta Read what these cash burn values mean

Date Owner Security Transaction Code Indirect 10b5-1 $Price #Shares $Value #Remaining
9 Apr 22 Marlo Michelle Cormier Platz Common Stock Payment of exercise Dispose F No No 15.61 1,816 28.35K 23,431
2 Mar 22 John Howard Goss JR Common Stock Sell Dispose S No No 17.76 21,489 381.64K 20,179
2 Mar 22 John Howard Goss JR Common Stock Option exercise Acquire M No No 11.78 3,804 44.81K 41,668
2 Mar 22 John Howard Goss JR Common Stock Option exercise Acquire M No No 9.09 7,682 69.83K 37,864
2 Mar 22 John Howard Goss JR Common Stock Option exercise Acquire M No No 16.65 10,003 166.55K 30,182
2 Mar 22 John Howard Goss JR Stock option Common Stock Option exercise Dispose M No No 11.78 3,804 44.81K 7,608
2 Mar 22 John Howard Goss JR Stock option Common Stock Option exercise Dispose M No No 9.09 7,682 69.83K 15,364
2 Mar 22 John Howard Goss JR Stock option Common Stock Option exercise Dispose M No No 16.65 10,003 166.55K 5,002
13F holders Current Prev Q Change
Total holders 193 210 -8.1%
Opened positions 23 32 -28.1%
Closed positions 40 29 +37.9%
Increased positions 56 64 -12.5%
Reduced positions 77 79 -2.5%
13F shares Current Prev Q Change
Total value 1.38B 1.88B -26.7%
Total shares 115.67M 120.43M -4.0%
Total puts 87.1K 173.4K -49.8%
Total calls 262.6K 414.7K -36.7%
Total put/call ratio 0.3 0.4 -20.7%
Largest owners Shares Value Change
BLK Blackrock 16.58M $197.6M -3.2%
FMR 16.05M $191.32M -3.4%
ArrowMark Colorado 14.13M $168.46M -6.2%
Vanguard 11.72M $139.75M -2.7%
Alliancebernstein 7.49M $89.22M -4.9%
LSV Asset Management 4.34M $51.72M -4.2%
Champlain Investment Partners 4.14M $49.39M -4.1%
STT State Street 4.04M $48.2M +1.2%
PFG Principal Financial Group Inc - Registered Shares 3.59M $42.79M +18.4%
Fisher Asset Management 3.58M $42.7M -0.9%
Largest transactions Shares Bought/sold Change
Hawkeye Capital Management 150K -950K -86.4%
ArrowMark Colorado 14.13M -940.91K -6.2%
Parametric Portfolio Associates 0 -617.42K EXIT
Renaissance Technologies 0 -604.5K EXIT
FMR 16.05M -571.46K -3.4%
Pacer Advisors 0 -566.54K EXIT
PFG Principal Financial Group Inc - Registered Shares 3.59M +558.63K +18.4%
MS Morgan Stanley 1.57M +553.38K +54.7%
BLK Blackrock 16.58M -548.99K -3.2%
FHI Federated Hermes 147.52K -488.5K -76.8%

Financial report summary

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Risks
  • The beauty products distribution industry is highly competitive and is consolidating.
  • We may be unable to anticipate and effectively respond to changes in consumer preferences and buying trends in a timely manner.
  • Our future success depends in part on our ability to successfully implement our strategic initiatives to improve the customer experience, attract new customers and improve the sales productivity of our stores.
  • Our restructuring program may not be successful or we may not fully realize the expected cost savings and/or operating efficiencies from our restructuring plans.
  • We depend upon manufacturers who may be unable to provide products of adequate quality or who may be unwilling to continue to supply products to us.
  • Any significant interruption in the supply of products by manufacturers and fillers or disruptions in our supply chain infrastructure could disrupt our ability to deliver merchandise to our stores and customers in a timely manner, which could have a material adverse effect on our business, financial condition and results of operations.
  • Fluctuations in the price, availability and quality of inventory may result in higher cost of goods, which we may not be able to pass on to the customers.
  • Our e-commerce businesses may be unsuccessful or, if successful, may redirect sales from our stores.
  • Diversion of professional products sold by BSG could have an adverse impact on our revenues.
  • BSG’s financial results are affected by the financial results of BSG’s franchised-based business (Armstrong McCall).
  • We may not be able to successfully identify acquisition candidates or successfully complete desirable acquisitions, and any acquisition could prove difficult to integrate, disrupt our business or have an adverse effect on our results of operations.
  • If we are unable to optimize our store base by profitably opening and operating new stores and closing less profitable stores, our business, financial condition and results of operations may be adversely affected.
  • Use of social media may adversely impact our reputation.
  • Our associates or others may engage in misconduct or other improper activities, including noncompliance with our policies and procedures.
  • If products sold by us are found to be defective in labeling or content, our credibility and that of the brands we sell may be harmed, marketplace acceptance of our products may decrease, and we may be exposed to liability in excess of our products liability insurance coverage and manufacturer indemnities.
  • We could be adversely affected if we do not comply with current laws and regulations or if we become subject to additional or more stringent laws and regulations.
  • The risks associated with climate change and other environmental impacts and increased focus by stakeholders on environmental issues, including those associated with climate change, could adversely affect our business, financial condition, and operating results.
  • If we fail to protect our intellectual property rights or if our products are found to infringe on the intellectual property rights of others, it could materially and negatively impact our business.
  • We may be adversely affected by any disruption in our information technology systems.
  • Unauthorized access to confidential information and data on our information technology systems and security and data breaches could materially adversely affect our business, financial condition and operating results.
  • The political, social and economic conditions in the geographies we serve may affect consumer purchases of discretionary items such as beauty products and salon services, which could have a material adverse effect on our business, financial condition and results of operations.
  • The occurrence of natural disasters or acts of violence or terrorism could adversely affect our operations and financial performance.
  • Currency exchange rate fluctuations could result in higher costs and decreased margins and earnings.
  • The COVID-19 pandemic has had and may continue to have an adverse effect on our business and results of operations.
  • Changes in consumer behavior as a result of COVID-19 may materially and adversely affect our business.
  • A reduction in traffic to, or the closing of, other retailers in shopping areas where our SBS stores are located could significantly reduce our sales and leave us with excess inventory, which could have a material adverse effect on our business, financial condition, profitability, and cash flows.
  • Our same store sales and quarterly financial performance may fluctuate for a variety of reasons.
  • A portion of our indebtedness is subject to floating interest rates.
  • We have substantial debt and may incur substantial additional debt, which could adversely affect our financial health, our ability to obtain financing in the future and our ability to react to changes in our business.
Management Discussion
  • Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations
  • This section should be read in conjunction with the information contained in our Annual Report on Form 10-K for the fiscal year ended September 30, 2021.
  • In the third quarter of fiscal year 2022, we delivered solid gross margin growth in both segments compared to the same period last year. Additionally during the quarter, we repaid the entire $300 million dollar balance on our 8.75% Senior Notes and continued to invest for growth through many of our initiatives, despite volatile market conditions and its impact on our topline performance. With a healthy balance sheet, a strong operating infrastructure and the loyalty of our core customers, we believe we are well positioned to continue navigating the macro-environment and remain focused on our four strategic pillars: leveraging our digital platform, driving loyalty and personalization, delivering product innovation and optimizing our supply chain.

Content analysis

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Positive
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Uncertain
Constraining
Legalese
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Readability
H.S. freshman Avg
New words: accrual, adjusted, adjusting, closed, closing, curb, dollar, expanding, favorable, hand, hedged, inflation, infrastructure, leasehold, partnership, repaid, Reserve, shown, stabilization, structure, styling, ticket, topline, turn, unchanged, weighted
Removed: approximate, capacity, continuing, December, demand, economic, highly, level, leveraged, positive, previously, recently, restructuring, transformation