Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jun. 30, 2021 | Jul. 23, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | SALLY BEAUTY HOLDINGS, INC. | |
Entity Central Index Key | 0001368458 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2021 | |
Trading Symbol | SBH | |
Amendment Flag | false | |
Current Fiscal Year End Date | --09-30 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Shell Company | false | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity File Number | 1-33145 | |
Entity Tax Identification Number | 36-2257936 | |
Entity Address, Address Line One | 3001 Colorado Boulevard | |
Entity Address, City or Town | Denton | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 76210 | |
City Area Code | 940 | |
Local Phone Number | 898-7500 | |
Security Exchange Name | NYSE | |
Title of 12(b) Security | Common Stock, $0.01 par value | |
Entity Incorporation, State or Country Code | DE | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Interactive Data Current | Yes | |
Entity Common Stock, Shares Outstanding | 113,033,420 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2021 | Sep. 30, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 270,317 | $ 514,151 |
Trade accounts receivable, net | 44,660 | 35,590 |
Accounts receivable, other | 31,779 | 20,839 |
Inventory | 935,427 | 814,503 |
Other current assets | 46,928 | 48,014 |
Total current assets | 1,329,111 | 1,433,097 |
Property and equipment, net of accumulated depreciation of $764,875 at June 30, 2021, and $694,709 at September 30, 2020 | 283,033 | 315,029 |
Operating lease assets | 540,480 | 525,634 |
Goodwill | 546,284 | 540,038 |
Intangible assets, excluding goodwill, net of accumulated amortization of $37,847 at June 30, 2021, and $63,491 at September 30, 2020 | 55,651 | 58,283 |
Other assets | 23,623 | 23,066 |
Total assets | 2,778,182 | 2,895,147 |
Current liabilities: | ||
Current maturities of long-term debt | 181 | 180 |
Accounts payable | 268,868 | 236,333 |
Accrued liabilities | 213,099 | 170,665 |
Current operating lease liabilities | 159,094 | 153,267 |
Income taxes payable | 8,963 | 2,917 |
Total current liabilities | 650,205 | 563,362 |
Long-term debt | 1,383,145 | 1,796,897 |
Long-term operating lease liabilities | 401,706 | 394,375 |
Other liabilities | 30,008 | 32,976 |
Deferred income tax liabilities, net | 90,848 | 92,094 |
Total liabilities | 2,555,912 | 2,879,704 |
Stockholders’ equity: | ||
Common stock, $0.01 par value. Authorized 500,000 shares; 113,033 and 112,824 shares issued and 112,780 and 112,405 shares outstanding at June 30, 2021, and September 30, 2020, respectively | 1,128 | 1,124 |
Preferred stock, $0.01 par value. Authorized 50,000 shares; none issued | ||
Additional paid-in capital | 13,858 | 1,913 |
Accumulated earnings | 288,818 | 117,109 |
Accumulated other comprehensive loss, net of tax | (81,534) | (104,703) |
Total stockholders’ equity | 222,270 | 15,443 |
Total liabilities and stockholders’ equity | $ 2,778,182 | $ 2,895,147 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2021 | Sep. 30, 2020 |
Statement Of Financial Position [Abstract] | ||
Property and equipment, accumulated depreciation (in dollars) | $ 764,875 | $ 694,709 |
Intangible assets, excluding goodwill, accumulated amortization (in dollars) | $ 37,847 | $ 63,491 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, Authorized shares | 500,000,000 | 500,000,000 |
Common stock, shares issued | 113,033,000 | 112,824,000 |
Common stock, shares outstanding | 112,780,000 | 112,405,000 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, Authorized shares | 50,000,000 | 50,000,000 |
Preferred stock, shares issued | 0 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Earnings (Loss) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Income Statement [Abstract] | ||||
Net sales | $ 1,022,387 | $ 705,287 | $ 2,884,737 | $ 2,556,518 |
Cost of goods sold | 507,981 | 383,441 | 1,432,378 | 1,330,067 |
Gross profit | 514,406 | 321,846 | 1,452,359 | 1,226,451 |
Selling, general and administrative expenses | 386,481 | 314,599 | 1,143,738 | 1,075,827 |
Restructuring | 508 | 5,816 | 1,371 | 11,541 |
Operating earnings | 127,417 | 1,431 | 307,250 | 139,083 |
Interest expense | 23,452 | 27,298 | 73,313 | 70,483 |
Earnings (loss) before provision for income taxes | 103,965 | (25,867) | 233,937 | 68,600 |
Provision (benefit) for income taxes | 27,759 | (2,341) | 62,228 | 25,543 |
Net earnings (loss) | $ 76,206 | $ (23,526) | $ 171,709 | $ 43,057 |
Earnings (loss) per share: | ||||
Basic | $ 0.68 | $ (0.21) | $ 1.52 | $ 0.38 |
Diluted | $ 0.66 | $ (0.21) | $ 1.50 | $ 0.37 |
Weighted-average shares: | ||||
Basic | 112,739 | 112,271 | 112,605 | 114,413 |
Diluted | 114,927 | 112,271 | 114,274 | 115,370 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Net earnings (loss) | $ 76,206 | $ (23,526) | $ 171,709 | $ 43,057 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments | 6,617 | 5,116 | 23,734 | (3,707) |
Interest rate caps, net of tax | 471 | 245 | 646 | 274 |
Foreign exchange contracts, net of tax | (191) | (286) | (1,211) | 1,552 |
Other comprehensive income (loss), net of tax | 6,897 | 5,075 | 23,169 | (1,881) |
Total comprehensive income (loss) | $ 83,103 | $ (18,451) | $ 194,878 | $ 41,176 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) shares in Thousands, $ in Thousands | Total | Cumulative Effect Period of Adoption Adjustment | Common Stock | Common StockCumulative Effect Period of Adoption Adjustment | Additional Paid-in Capital | Additional Paid-in CapitalCumulative Effect Period of Adoption Adjustment | Accumulated Earnings (Deficit) | Accumulated Earnings (Deficit)Cumulative Effect Period of Adoption Adjustment | Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive LossCumulative Effect Period of Adoption Adjustment |
Balance at Sep. 30, 2019 | $ (60,323) | $ (445) | $ 1,167 | $ 55,797 | $ (445) | $ (117,287) | ||||
Balance (in shares) at Sep. 30, 2019 | 116,725 | |||||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201602Member | us-gaap:AccountingStandardsUpdate201602Member | us-gaap:AccountingStandardsUpdate201602Member | us-gaap:AccountingStandardsUpdate201602Member | us-gaap:AccountingStandardsUpdate201602Member | |||||
Increase (Decrease) in Stockholders' Equity | ||||||||||
Net earnings (loss) | 53,215 | 53,215 | ||||||||
Other comprehensive income (loss) | 14,870 | 14,870 | ||||||||
Repurchases and cancellations of common stock | (11,357) | $ (7) | $ (6,237) | (5,113) | ||||||
Repurchases and cancellations of common stock (in shares) | (766) | |||||||||
Share-based compensation | 3,473 | 3,473 | ||||||||
Stock issued for equity awards | 2,766 | $ 2 | 2,764 | |||||||
Stock issued for equity awards (in shares) | 206 | |||||||||
Balance at Dec. 31, 2019 | 2,199 | $ 1,162 | 103,454 | (102,417) | ||||||
Balance (in shares) at Dec. 31, 2019 | 116,165 | |||||||||
Balance at Sep. 30, 2019 | (60,323) | $ (445) | $ 1,167 | 55,797 | $ (445) | (117,287) | ||||
Balance (in shares) at Sep. 30, 2019 | 116,725 | |||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||
Net earnings (loss) | 43,057 | |||||||||
Other comprehensive income (loss) | (1,881) | |||||||||
Balance at Jun. 30, 2020 | (69,133) | $ 1,123 | 2,513 | 46,399 | (119,168) | |||||
Balance (in shares) at Jun. 30, 2020 | 112,280 | |||||||||
Balance at Dec. 31, 2019 | 2,199 | $ 1,162 | 103,454 | (102,417) | ||||||
Balance (in shares) at Dec. 31, 2019 | 116,165 | |||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||
Net earnings (loss) | 13,368 | 13,368 | ||||||||
Other comprehensive income (loss) | (21,826) | (21,826) | ||||||||
Repurchases and cancellations of common stock | (50,000) | $ (39) | (3,064) | (46,897) | ||||||
Repurchases and cancellations of common stock (in shares) | (3,936) | |||||||||
Share-based compensation | 3,059 | 3,059 | ||||||||
Stock issued for equity awards | 5 | 5 | ||||||||
Stock issued for equity awards (in shares) | 35 | |||||||||
Balance at Mar. 31, 2020 | (53,195) | $ 1,123 | 69,925 | (124,243) | ||||||
Balance (in shares) at Mar. 31, 2020 | 112,264 | |||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||
Net earnings (loss) | (23,526) | (23,526) | ||||||||
Other comprehensive income (loss) | 5,075 | 5,075 | ||||||||
Share-based compensation | 2,562 | 2,562 | ||||||||
Stock issued for stock options | (49) | (49) | ||||||||
Stock issued for stock options (in shares) | 16 | |||||||||
Balance at Jun. 30, 2020 | (69,133) | $ 1,123 | 2,513 | 46,399 | (119,168) | |||||
Balance (in shares) at Jun. 30, 2020 | 112,280 | |||||||||
Balance at Sep. 30, 2020 | $ 15,443 | $ 1,124 | 1,913 | 117,109 | (104,703) | |||||
Balance (in shares) at Sep. 30, 2020 | 112,405 | 112,405 | ||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||
Net earnings (loss) | $ 57,191 | 57,191 | ||||||||
Other comprehensive income (loss) | 23,588 | 23,588 | ||||||||
Share-based compensation | 2,893 | 2,893 | ||||||||
Stock issued for equity awards | (249) | $ 1 | (250) | |||||||
Stock issued for equity awards (in shares) | 133 | |||||||||
Balance at Dec. 31, 2020 | 98,866 | $ 1,125 | 4,556 | 174,300 | (81,115) | |||||
Balance (in shares) at Dec. 31, 2020 | 112,538 | |||||||||
Balance at Sep. 30, 2020 | $ 15,443 | $ 1,124 | 1,913 | 117,109 | (104,703) | |||||
Balance (in shares) at Sep. 30, 2020 | 112,405 | 112,405 | ||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||
Net earnings (loss) | $ 171,709 | |||||||||
Other comprehensive income (loss) | 23,169 | |||||||||
Balance at Jun. 30, 2021 | $ 222,270 | $ 1,128 | 13,858 | 288,818 | (81,534) | |||||
Balance (in shares) at Jun. 30, 2021 | 112,780 | 112,780 | ||||||||
Balance at Dec. 31, 2020 | $ 98,866 | $ 1,125 | 4,556 | 174,300 | (81,115) | |||||
Balance (in shares) at Dec. 31, 2020 | 112,538 | |||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||
Net earnings (loss) | 38,312 | 38,312 | ||||||||
Other comprehensive income (loss) | (7,316) | (7,316) | ||||||||
Share-based compensation | 2,648 | 2,648 | ||||||||
Stock issued for equity awards | 2,323 | $ 2 | 2,321 | |||||||
Stock issued for equity awards (in shares) | 141 | |||||||||
Balance at Mar. 31, 2021 | 134,833 | $ 1,127 | 9,525 | 212,612 | (88,431) | |||||
Balance (in shares) at Mar. 31, 2021 | 112,679 | |||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||
Net earnings (loss) | 76,206 | 76,206 | ||||||||
Other comprehensive income (loss) | 6,897 | 6,897 | ||||||||
Share-based compensation | 2,617 | 2,617 | ||||||||
Stock issued for equity awards | 1,717 | $ 1 | 1,716 | |||||||
Stock issued for equity awards (in shares) | 101 | |||||||||
Balance at Jun. 30, 2021 | $ 222,270 | $ 1,128 | $ 13,858 | $ 288,818 | $ (81,534) | |||||
Balance (in shares) at Jun. 30, 2021 | 112,780 | 112,780 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Cash Flows from Operating Activities: | ||
Net earnings | $ 171,709 | $ 43,057 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 78,090 | 80,829 |
Share-based compensation expense | 8,158 | 9,094 |
Amortization of deferred financing costs | 3,280 | 2,965 |
Loss (gain) on early extinguishment of debt | 2,449 | (357) |
Loss on disposal of equipment and other property | 1,638 | 2,910 |
Deferred income taxes | (998) | 600 |
Changes in (exclusive of effects of acquisitions): | ||
Trade accounts receivable | (8,612) | 495 |
Accounts receivable, other | (10,363) | 45,888 |
Inventory | (108,317) | 134,824 |
Other current assets | (931) | (15,840) |
Other assets | 1,578 | (691) |
Operating leases, net | (1,595) | |
Accounts payable and accrued liabilities | 78,250 | (35,572) |
Income taxes payable | 6,372 | (7,154) |
Other liabilities | (2,980) | 13,336 |
Net cash provided by operating activities | 217,728 | 274,384 |
Cash Flows from Investing Activities: | ||
Payments for property and equipment, net of proceeds | (44,888) | (89,702) |
Acquisitions, net of cash acquired | (2,351) | (1,944) |
Net cash used by investing activities | (47,239) | (91,646) |
Cash Flows from Financing Activities: | ||
Proceeds from issuance of long-term debt | 1,087,504 | |
Repayments of long-term debt | (418,986) | (437,391) |
Debt issuance costs | (1,300) | (6,257) |
Payments for common stock repurchased | (61,357) | |
Proceeds from equity awards | 3,790 | 2,722 |
Net cash (used) provided by financing activities | (416,496) | 585,221 |
Effect of foreign exchange rate changes on cash and cash equivalents | 2,173 | (643) |
Net (decrease) increase in cash and cash equivalents | (243,834) | 767,316 |
Cash and cash equivalents, beginning of period | 514,151 | 71,495 |
Cash and cash equivalents, end of period | 270,317 | 838,811 |
Supplemental Cash Flow Information: | ||
Interest paid | 86,293 | 74,046 |
Income taxes paid | 53,764 | 45,292 |
Capital expenditures incurred but not paid | $ 2,098 | $ 4,469 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Jun. 30, 2021 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation | 1. Basis of Presentation The condensed consolidated interim financial statements included herein have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and pursuant to the rules and regulations of the SEC. Accordingly, certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC, although we believe that the disclosures included herein are adequate to make the information not misleading. These condensed consolidated interim financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended September 30, 2020. In the opinion of management, these condensed consolidated interim financial statements reflect all adjustments that are of a normal recurring nature and which are necessary to present fairly our consolidated financial position as of June 30, 2021 and September 30, 2020, and our consolidated results of operations, consolidated comprehensive income, and consolidated statements of stockholders’ equity for the three and nine months ended June 30, 2021 and 2020, our consolidated cash flows for the nine months ended June 30, 2021 and 2020. Our operating results for the three and nine months ended June 30, 2021, may not be indicative of the results that may be expected for the full fiscal year ending September 30, 2021, in particular as a result of the uncertainty around the continuing effects of the COVID-19 pandemic on future periods. Due to the uncertainty over the duration and severity of the economic and operational impacts of COVID-19, the adverse impact of the pandemic may continue further into our fiscal year 2021 and possibly beyond, and it may be material. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | 2. Significant Accounting Policies We adhere to the same accounting policies in the preparation of our condensed consolidated interim financial statements as we do in the preparation of our full year consolidated financial statements. As permitted under GAAP, interim accounting for certain expenses, including income taxes, is based on full-year assumptions. For interim financial reporting purposes, income taxes are recorded based upon estimated annual effective income tax rates. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Jun. 30, 2021 | |
New Accounting Pronouncements And Changes In Accounting Principles [Abstract] | |
Recent Accounting Pronouncements | 3. Recent Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019-12 which simplifies the accounting for income taxes by removing an exception related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period with year to date losses and the recognition of deferred tax liabilities for outside basis differences. Additionally, the update clarifies and simplifies other areas of ASC 740, Income Taxes |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Jun. 30, 2021 | |
Revenue From Contract With Customer [Abstract] | |
Revenue Recognition | 4. Revenue Recognition Substantially all of our revenue is derived through the sale of merchandise at the point-of-sale. Revenue is recognized net of estimated sales returns and sales taxes. We estimate sales returns based on historical data. Changes to our contract liabilities for the period were as follows (in thousands): September 30, 2020 $ 13,947 Loyalty points and gift cards issued but not redeemed, net of estimated breakage 11,950 Revenue recognized from beginning liability (9,391 ) June 30, 2021 $ 16,506 See Note 11, Business Segments |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Jun. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 5. Fair Value Measurements Fair value on recurring basis Consistent with the three-level hierarchy defined in ASC Topic 820, Fair Value Measurement Classification Fair Value Hierarchy Level June 30, 2021 September 30, 2020 Financial Assets: Cash equivalents Cash and cash equivalents Level 1 $ — $ 194,612 Foreign exchange contracts Other current assets Level 2 1 — Interest rate caps Other assets Level 2 54 27 Total assets $ 55 $ 194,639 . Financial Liabilities: Foreign exchange contracts Accrued liabilities Level 2 $ 535 $ — Other fair value disclosures June 30, 2021 September 30, 2020 Fair Value Hierarchy Level Carrying Value Fair Value Carrying Value Fair Value Long-term debt, excluding capital leases Senior notes Level 1 $ 979,961 $ 1,029,810 $ 1,177,380 $ 1,217,707 Term loan B Level 2 414,375 413,339 635,788 619,397 Total long-term debt $ 1,394,336 $ 1,443,149 $ 1,813,168 $ 1,837,104 The table above excludes amounts, if any, related to our ABL facility as the balance approximates fair value due to the short-term nature of our borrowings. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Jun. 30, 2021 | |
Stockholders Equity Note [Abstract] | |
Stockholders' Equity | 6. Stockholders’ Equity Share Repurchases In August 2017, our Board of Directors approved a share repurchase program authorizing the Company to repurchase up to $1.0 billion of its common stock, subject to certain limitations governed by our debt agreements, over an approximate four-year Subsequent Event Information related to our shares repurchased and subsequently retired were as follows (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2021 2020 2021 2020 Number of shares repurchased — — — 4,702 Total cost of share repurchased $ — $ — $ — $ 61,357 Accumulated Other Comprehensive Loss The change in accumulated other comprehensive loss (“AOCL”) was as follows (in thousands): Foreign Currency Translation Adjustments Interest Rate Caps Foreign Exchange Contracts Total Balance at September 30, 2020 $ (102,111 ) $ (3,003 ) $ 411 $ (104,703 ) Other comprehensive income (loss) before reclassification, net of tax 23,734 (196 ) (1,072 ) 22,466 Reclassification to net earnings, net of tax — 842 (139 ) 703 Balance at June 30, 2021 $ (78,377 ) $ (2,357 ) $ (800 ) $ (81,534 ) The tax impact for the changes in other comprehensive loss and the reclassifications to net earnings was not material. |
Weighted-Average Shares
Weighted-Average Shares | 9 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Weighted-Average Shares | 7. Weighted-Average Shares The following table sets forth the reconciliation of basic and diluted weighted-average shares (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2021 2020 2021 2020 Weighted-average basic shares 112,739 112,271 112,605 114,413 Dilutive securities: Stock option and stock award programs 2,188 — 1,669 957 Weighted-average diluted shares 114,927 112,271 114,274 115,370 Anti-dilutive options excluded from our computation of diluted shares 2,188 4,976 1,670 4,887 Potentially dilutive stock option and stock award programs excluded from our computation of diluted shares — 941 — — |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Jun. 30, 2021 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | 8. Goodwill and Intangible Assets During the three months ended March 31, 2021, we completed our annual assessment for impairment of goodwill and other intangible assets. For goodwill, we used a qualitative analysis and our actual and forecasted results are exceeding the estimates from the last quantitative test . No material impairment losses were recognized in the current or prior periods presented in connection with our goodwill and other intangible assets. For the three months ended June 30, 2021 and 2020, amortization expense related to other intangible assets was $1.6 million and $2.2 million, respectively, and for the nine months ended June 30, 2021 and 2020, amortization expense was $5.0 million and $6.8 million, respectively. Additionally during the nine months ended June 30, 2021, the increase in goodwill was primarily from the effects of foreign currency exchange rates of $6.1 million. |
Short-term Borrowings and Long-
Short-term Borrowings and Long-term Debt | 9 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
Short-term Borrowings and Long-term Debt | 9. Short-term Borrowings and Long-term Debt At June 30, 2021, there were no outstanding borrowings under our ABL facility During the three months ended March 31, 2021, we paid the remaining $213.2 million of aggregate outstanding principal on our term loan B fixed tranche at par, excluding accrued interest. In connection with the debt repayment, we recognized a $1.4 million loss on the extinguishment of debt from the write-off of unamortized deferred financing costs On April 1, 2021, we called the entire outstanding balance of $197.4 million of our 5.50% senior notes due 2023 at par plus a premium. In connection with the repayment, we recognized losses on extinguishment of debt in the aggregate amount of $2.8 million, which included a $1.8 million call premium and the write-off of $1.0 million in unamortized deferred financing costs. On June 30, 2021, we elected to repay $8.3 million of aggregate outstanding principal on our term loan B variable tranche. This optional prepayment did not have any early prepayment penalties. In connection with the prepayment, we recognized a loss on extinguishment of debt of $0.1 million from the write-off of unamortized deferred financing costs. As of June 30, 2021, we still have $414.4 million remaining on our term loan B variable tranche. Covenants The agreements governing our ABL facility, term loan B and the senior notes contain a customary covenant package that places restrictions on the disposition of assets, the granting of liens and security interests, the prepayment of certain indebtedness, and other matters with customary events of default, including customary cross-default and/or cross-acceleration provisions. As of June 30, 2021, we were in compliance with all debt covenants, and all the net assets of our consolidated subsidiaries were unrestricted from transfer. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 9 Months Ended |
Jun. 30, 2021 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | 10. Derivative Instruments and Hedging Activities During the nine months ended June 30, 2021, we did not purchase or hold any derivative instruments for trading or speculative purposes. See Note 5, Fair Value Measurements Designated Cash Flow Hedges Foreign Currency Forwards We regularly enter into foreign currency forwards to mitigate our exposure to exchange rate changes on inventory purchases in U.S. dollars by our foreign subsidiaries. At June 30, 2021, the notional amount we held through these forwards, based upon exchange rates at June 30, 2021, was as follows (in thousands): Notional Currency Notional Amount Euro $ 4,558 Mexican Peso 3,698 Canadian Dollar 1,393 Total $ 9,649 We record quarterly, net of income tax, the changes in fair value related to the foreign currency forwards into AOCL. As the forwards are exercised, the realized value is recognized into cost of goods sold based on inventory turns. For the three and nine months ended June 30, 2021, we recognized a loss of $0.3 million and a gain of $0.1 million, respectively, into cost of goods sold on our condensed consolidated statements of earnings. Based on June 30, 2021 valuations and exchange rates, we expect to reclassify losses of approximately $1.0 million into cost of goods sold over the next 12 months. Interest Rate Caps In July 2017, we purchased two interest rate caps with an initial aggregate notional amount of $550 million (the “interest rate caps”) to mitigate the exposure to higher interest rates in connection with our term loan B. The interest rate caps are comprised of individual caplets that expire ratably through June 30, 2023, and are designated as cash flow hedges. Accordingly, changes in fair value of the interest rate caps are recorded quarterly, net of income tax, and are included in AOCL. Over the next 12 months, we expect to reclassify approximately $1.6 million into interest expense, which represents the original value of the expiring caplets. The effects of our interest rate caps on our condensed consolidated statements of earnings were not material for the three and nine months ended June 30, 2021. |
Business Segments
Business Segments | 9 Months Ended |
Jun. 30, 2021 | |
Segment Reporting [Abstract] | |
Business Segments | 11. Business Segments Segment data for the three and nine months ended June 30, 2021 and 2020, is as follows (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2021 2020 2021 2020 Net sales: Sally Beauty Supply ("SBS") $ 602,681 $ 415,468 $ 1,693,015 $ 1,504,125 Beauty Systems Group ("BSG") 419,706 289,819 1,191,722 1,052,393 Total $ 1,022,387 $ 705,287 $ 2,884,737 $ 2,556,518 Earnings (loss) before provision for income taxes: Segment operating earnings: SBS $ 116,784 $ 3,087 $ 311,975 $ 133,684 BSG 55,265 40,084 151,680 143,557 Segment operating earnings 172,049 43,171 463,655 277,241 Unallocated expenses 44,124 35,924 155,034 126,617 Restructuring 508 5,816 1,371 11,541 Consolidated operating earnings 127,417 1,431 307,250 139,083 Interest expense 23,452 27,298 73,313 70,483 Earnings (loss) before provision for income taxes $ 103,965 $ (25,867 ) $ 233,937 $ 68,600 Sales between segments, which are eliminated in consolidation, were not material during the three and nine months ended June 30, 2021 and 2020. Disaggregation of net sales by segment Three Months Ended June 30, Nine Months Ended June 30, SBS 2021 2020 2021 2020 Hair color 35.6 % 36.6 % 35.3 % 33.8 % Hair care 18.9 % 16.3 % 18.8 % 19.0 % Skin and nail care 14.6 % 13.3 % 12.2 % 13.8 % Styling tools 11.6 % 13.6 % 14.3 % 13.0 % Salon supplies and accessories 7.6 % 9.1 % 7.7 % 7.5 % Textured hair products 5.8 % 4.7 % 5.9 % 5.1 % Other beauty items 5.9 % 6.4 % 5.8 % 7.8 % Total 100.0 % 100.0 % 100.0 % 100.0 % Three Months Ended June 30, Nine Months Ended June 30, BSG 2021 2020 2021 2020 Hair color 45.1 % 42.2 % 43.2 % 39.7 % Hair care 36.6 % 32.5 % 36.5 % 34.2 % Skin and nail care 6.8 % 8.2 % 7.3 % 8.2 % Styling tools 6.3 % 6.2 % 6.5 % 6.4 % Other beauty items 2.6 % 7.0 % 2.5 % 3.9 % Promotional items 2.6 % 3.9 % 4.0 % 7.6 % Total 100.0 % 100.0 % 100.0 % 100.0 % The following tables disaggregate our segment revenue by sales channels: Three Months Ended June 30, Nine Months Ended June 30, SBS 2021 2020 2021 2020 Company-operated stores 94.2 % 79.1 % 93.7 % 90.9 % E-commerce 5.7 % 20.8 % 6.2 % 8.9 % Franchise stores 0.1 % 0.1 % 0.1 % 0.2 % Total 100.0 % 100.0 % 100.0 % 100.0 % Three Months Ended June 30, Nine Months Ended June 30, BSG 2021 2020 2021 2020 Company-operated stores 69.2 % 63.9 % 69.7 % 68.2 % Distributor sales consultants 14.1 % 10.8 % 14.0 % 15.5 % E-commerce 8.8 % 17.4 % 8.8 % 8.9 % Franchise stores 7.9 % 7.9 % 7.5 % 7.4 % Total 100.0 % 100.0 % 100.0 % 100.0 % |
Income Tax
Income Tax | 9 Months Ended |
Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Tax | 12. Income Tax For the three months ended June 30, 2021 and 2020, our effective tax rates were 26.7% and 9.1%, respectively. The effective tax rate for the third quarter of the prior year was negatively impacted by foreign losses for which a tax benefit could not be recognized. For the nine months ended June 30, 2021 and 2020, our effective tax rates were 26.6% and 37.2%, respectively. The decrease in the effective tax rate was primarily due to greater losses in the prior year from foreign subsidiaries for which a tax benefit could not be recognized and the establishment of a valuation allowance in a foreign subsidiary in the prior year. Refer to the following rate reconciliation for more details relating to the period over period differences in the effective tax rate: Three Months Ended Nine Months Ended June 30, June 30, 2021 2020 2021 2020 U.S. federal statutory income tax rate 21.0 % 21.0 % 21.0 % 21.0 % State income taxes, net of federal tax benefit 3.2 2.9 3.3 3.9 Effect of foreign operations 1.1 4.6 0.9 (0.5 ) Foreign valuation allowances (1) 0.5 (13.0 ) 0.3 10.2 Deemed repatriation tax (1) — (1.1 ) — 0.4 Other, net (1) 0.9 (5.3 ) 1.1 2.2 Effective tax rate 26.7 % 9.1 % 26.6 % 37.2 % (1) For the three months ended June 30, 2020, the impact of these and certain other tax impacting items is opposite the customary relationship due to the loss before the provision for income taxes that was incurred. A lower effective tax rate is not beneficial in situations where a pre-tax book loss has been incurred. |
Subsequent Event
Subsequent Event | 9 Months Ended |
Jun. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | 13. Subsequent Event In 2017 the Board of Directors approved a share repurchase program authorizing us to repurchase up to $1.0 billion of our common stock through September 30, 2021. On July 22, 2021, the Board approved a term extension of the share repurchase program for the four-year |
Recent Accounting Pronounceme_2
Recent Accounting Pronouncements (Policies) | 9 Months Ended |
Jun. 30, 2021 | |
New Accounting Pronouncements And Changes In Accounting Principles [Abstract] | |
Recent Accounting Pronouncements | In December 2019, the FASB issued ASU No. 2019-12 which simplifies the accounting for income taxes by removing an exception related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period with year to date losses and the recognition of deferred tax liabilities for outside basis differences. Additionally, the update clarifies and simplifies other areas of ASC 740, Income Taxes |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Jun. 30, 2021 | |
Revenue From Contract With Customer [Abstract] | |
Schedule of Changes to Contract Liabilities | Changes to our contract liabilities for the period were as follows (in thousands): September 30, 2020 $ 13,947 Loyalty points and gift cards issued but not redeemed, net of estimated breakage 11,950 Revenue recognized from beginning liability (9,391 ) June 30, 2021 $ 16,506 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Jun. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of financial assets and liabilities and other fair value disclosures by fair value hierarchy | Fair value on recurring basis Consistent with the three-level hierarchy defined in ASC Topic 820, Fair Value Measurement Classification Fair Value Hierarchy Level June 30, 2021 September 30, 2020 Financial Assets: Cash equivalents Cash and cash equivalents Level 1 $ — $ 194,612 Foreign exchange contracts Other current assets Level 2 1 — Interest rate caps Other assets Level 2 54 27 Total assets $ 55 $ 194,639 . Financial Liabilities: Foreign exchange contracts Accrued liabilities Level 2 $ 535 $ — Other fair value disclosures June 30, 2021 September 30, 2020 Fair Value Hierarchy Level Carrying Value Fair Value Carrying Value Fair Value Long-term debt, excluding capital leases Senior notes Level 1 $ 979,961 $ 1,029,810 $ 1,177,380 $ 1,217,707 Term loan B Level 2 414,375 413,339 635,788 619,397 Total long-term debt $ 1,394,336 $ 1,443,149 $ 1,813,168 $ 1,837,104 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Jun. 30, 2021 | |
Stockholders Equity Note [Abstract] | |
Schedule of Shares Repurchased and Subsequently Retired | Information related to our shares repurchased and subsequently retired were as follows (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2021 2020 2021 2020 Number of shares repurchased — — — 4,702 Total cost of share repurchased $ — $ — $ — $ 61,357 |
Schedule of changes in accumulated other comprehensive loss | The change in accumulated other comprehensive loss (“AOCL”) was as follows (in thousands): Foreign Currency Translation Adjustments Interest Rate Caps Foreign Exchange Contracts Total Balance at September 30, 2020 $ (102,111 ) $ (3,003 ) $ 411 $ (104,703 ) Other comprehensive income (loss) before reclassification, net of tax 23,734 (196 ) (1,072 ) 22,466 Reclassification to net earnings, net of tax — 842 (139 ) 703 Balance at June 30, 2021 $ (78,377 ) $ (2,357 ) $ (800 ) $ (81,534 ) |
Weighted-Average Shares (Tables
Weighted-Average Shares (Tables) | 9 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of reconciliation of basic and diluted weighted-average shares | The following table sets forth the reconciliation of basic and diluted weighted-average shares (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2021 2020 2021 2020 Weighted-average basic shares 112,739 112,271 112,605 114,413 Dilutive securities: Stock option and stock award programs 2,188 — 1,669 957 Weighted-average diluted shares 114,927 112,271 114,274 115,370 Anti-dilutive options excluded from our computation of diluted shares 2,188 4,976 1,670 4,887 Potentially dilutive stock option and stock award programs excluded from our computation of diluted shares — 941 — — |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activities (Tables) | 9 Months Ended |
Jun. 30, 2021 | |
Foreign Currency Forwards | |
Schedule of notional amount held through foreign currency forwards, based upon exchange rates | At June 30, 2021, the notional amount we held through these forwards, based upon exchange rates at June 30, 2021, was as follows (in thousands): Notional Currency Notional Amount Euro $ 4,558 Mexican Peso 3,698 Canadian Dollar 1,393 Total $ 9,649 |
Business Segments (Tables)
Business Segments (Tables) | 9 Months Ended |
Jun. 30, 2021 | |
Segment Reporting [Abstract] | |
Schedule of segment data | Segment data for the three and nine months ended June 30, 2021 and 2020, is as follows (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2021 2020 2021 2020 Net sales: Sally Beauty Supply ("SBS") $ 602,681 $ 415,468 $ 1,693,015 $ 1,504,125 Beauty Systems Group ("BSG") 419,706 289,819 1,191,722 1,052,393 Total $ 1,022,387 $ 705,287 $ 2,884,737 $ 2,556,518 Earnings (loss) before provision for income taxes: Segment operating earnings: SBS $ 116,784 $ 3,087 $ 311,975 $ 133,684 BSG 55,265 40,084 151,680 143,557 Segment operating earnings 172,049 43,171 463,655 277,241 Unallocated expenses 44,124 35,924 155,034 126,617 Restructuring 508 5,816 1,371 11,541 Consolidated operating earnings 127,417 1,431 307,250 139,083 Interest expense 23,452 27,298 73,313 70,483 Earnings (loss) before provision for income taxes $ 103,965 $ (25,867 ) $ 233,937 $ 68,600 |
Schedule of disaggregation of net sales by segment | Disaggregation of net sales by segment Three Months Ended June 30, Nine Months Ended June 30, SBS 2021 2020 2021 2020 Hair color 35.6 % 36.6 % 35.3 % 33.8 % Hair care 18.9 % 16.3 % 18.8 % 19.0 % Skin and nail care 14.6 % 13.3 % 12.2 % 13.8 % Styling tools 11.6 % 13.6 % 14.3 % 13.0 % Salon supplies and accessories 7.6 % 9.1 % 7.7 % 7.5 % Textured hair products 5.8 % 4.7 % 5.9 % 5.1 % Other beauty items 5.9 % 6.4 % 5.8 % 7.8 % Total 100.0 % 100.0 % 100.0 % 100.0 % Three Months Ended June 30, Nine Months Ended June 30, BSG 2021 2020 2021 2020 Hair color 45.1 % 42.2 % 43.2 % 39.7 % Hair care 36.6 % 32.5 % 36.5 % 34.2 % Skin and nail care 6.8 % 8.2 % 7.3 % 8.2 % Styling tools 6.3 % 6.2 % 6.5 % 6.4 % Other beauty items 2.6 % 7.0 % 2.5 % 3.9 % Promotional items 2.6 % 3.9 % 4.0 % 7.6 % Total 100.0 % 100.0 % 100.0 % 100.0 % The following tables disaggregate our segment revenue by sales channels: Three Months Ended June 30, Nine Months Ended June 30, SBS 2021 2020 2021 2020 Company-operated stores 94.2 % 79.1 % 93.7 % 90.9 % E-commerce 5.7 % 20.8 % 6.2 % 8.9 % Franchise stores 0.1 % 0.1 % 0.1 % 0.2 % Total 100.0 % 100.0 % 100.0 % 100.0 % Three Months Ended June 30, Nine Months Ended June 30, BSG 2021 2020 2021 2020 Company-operated stores 69.2 % 63.9 % 69.7 % 68.2 % Distributor sales consultants 14.1 % 10.8 % 14.0 % 15.5 % E-commerce 8.8 % 17.4 % 8.8 % 8.9 % Franchise stores 7.9 % 7.9 % 7.5 % 7.4 % Total 100.0 % 100.0 % 100.0 % 100.0 % |
Income Tax (Tables)
Income Tax (Tables) | 9 Months Ended |
Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Reconciliation for More Details Relating to Period Over Period Differences in Effective Tax Rate | Refer to the following rate reconciliation for more details relating to the period over period differences in the effective tax rate: Three Months Ended Nine Months Ended June 30, June 30, 2021 2020 2021 2020 U.S. federal statutory income tax rate 21.0 % 21.0 % 21.0 % 21.0 % State income taxes, net of federal tax benefit 3.2 2.9 3.3 3.9 Effect of foreign operations 1.1 4.6 0.9 (0.5 ) Foreign valuation allowances (1) 0.5 (13.0 ) 0.3 10.2 Deemed repatriation tax (1) — (1.1 ) — 0.4 Other, net (1) 0.9 (5.3 ) 1.1 2.2 Effective tax rate 26.7 % 9.1 % 26.6 % 37.2 % (1) For the three months ended June 30, 2020, the impact of these and certain other tax impacting items is opposite the customary relationship due to the loss before the provision for income taxes that was incurred. A lower effective tax rate is not beneficial in situations where a pre-tax book loss has been incurred. |
Revenue Recognition - Schedule
Revenue Recognition - Schedule of Changes to Contract Liabilities (Details) $ in Thousands | 9 Months Ended |
Jun. 30, 2021USD ($) | |
Contract With Customer Liability [Abstract] | |
Beginning balance | $ 13,947 |
Loyalty points and gift cards issued but not redeemed, net of estimated breakage | 11,950 |
Revenue recognized from beginning liability | (9,391) |
Ending balance | $ 16,506 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Jul. 23, 2021 | Jun. 30, 2021 | Sep. 30, 2020 |
Long-term debt, excluding capital leases | |||
Long-term debt, excluding capital leases, Carrying Value | $ 1,394,336 | $ 1,813,168 | |
Long-term debt, excluding capital leases, Fair Value | $ 1,443,149 | 1,837,104 | |
Level 1 | Senior notes | |||
Long-term debt, excluding capital leases | |||
Long-term debt, excluding capital leases, Carrying Value | 979,961 | 1,177,380 | |
Long-term debt, excluding capital leases, Fair Value | 1,029,810 | 1,217,707 | |
Level 2 | Term loan B | |||
Long-term debt, excluding capital leases | |||
Long-term debt, excluding capital leases, Carrying Value | $ 414,375 | 635,788 | |
Long-term debt, excluding capital leases, Fair Value | 413,339 | 619,397 | |
Fair value measurement on recurring basis | |||
Financial Assets: | |||
Total assets | 55 | 194,639 | |
Fair value measurement on recurring basis | Level 1 | Cash and cash equivalents | |||
Financial Assets: | |||
Cash equivalents | 194,612 | ||
Fair value measurement on recurring basis | Level 2 | Other current assets | |||
Financial Assets: | |||
Foreign exchange contracts | 1 | ||
Fair value measurement on recurring basis | Level 2 | Other assets | |||
Financial Assets: | |||
Interest rate caps | 54 | $ 27 | |
Fair value measurement on recurring basis | Level 2 | Accrued Liabilities | |||
Financial Liabilities: | |||
Foreign exchange contracts | $ 535 |
Stockholders' Equity - Share Re
Stockholders' Equity - Share Repurchase Program (Details) - 2017 Share Repurchase program | 1 Months Ended |
Aug. 31, 2017USD ($) | |
Share Repurchase Program | |
Amount of shares authorized to be repurchased | $ 1,000,000,000 |
Term of share repurchase program | 4 years |
Stock repurchase program, expiration date | Sep. 30, 2021 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Shares Repurchased and Subsequently Retired (Details) shares in Thousands, $ in Thousands | 9 Months Ended |
Jun. 30, 2020USD ($)shares | |
Stockholders Equity Note [Abstract] | |
Number of shares repurchased | shares | 4,702 |
Total cost of share repurchased | $ | $ 61,357 |
Stockholders' Equity - Change i
Stockholders' Equity - Change in AOCL (Details) $ in Thousands | 9 Months Ended |
Jun. 30, 2021USD ($) | |
Accumulated Other Comprehensive Income Loss [Line Items] | |
Balance | $ 15,443 |
Balance | 222,270 |
Interest rate caps | |
Accumulated Other Comprehensive Income Loss [Line Items] | |
Balance | (3,003) |
Other comprehensive income (loss) before reclassification, net of tax | (196) |
Reclassification to net earnings, net of tax | 842 |
Balance | (2,357) |
Foreign exchange contracts | |
Accumulated Other Comprehensive Income Loss [Line Items] | |
Balance | 411 |
Other comprehensive income (loss) before reclassification, net of tax | (1,072) |
Reclassification to net earnings, net of tax | (139) |
Balance | (800) |
Foreign currency translation adjustments | |
Accumulated Other Comprehensive Income Loss [Line Items] | |
Balance | (102,111) |
Other comprehensive income (loss) before reclassification, net of tax | 23,734 |
Balance | (78,377) |
Accumulated Other Comprehensive Loss | |
Accumulated Other Comprehensive Income Loss [Line Items] | |
Balance | (104,703) |
Other comprehensive income (loss) before reclassification, net of tax | 22,466 |
Reclassification to net earnings, net of tax | 703 |
Balance | $ (81,534) |
Weighted-Average Shares (Detail
Weighted-Average Shares (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Earnings Per Share Reconciliation: | ||||
Weighted-average basic shares | 112,739 | 112,271 | 112,605 | 114,413 |
Dilutive securities: | ||||
Stock option and stock award programs | 2,188 | 1,669 | 957 | |
Weighted-average diluted shares | 114,927 | 112,271 | 114,274 | 115,370 |
Anti-dilutive options excluded from our computation of diluted shares | 2,188 | 4,976 | 1,670 | 4,887 |
Potentially dilutive stock option and stock award programs excluded from our computation of diluted shares | 941 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets - (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||||
Impairment losses in connection with the goodwill | $ 0 | $ 0 | ||
Impairment losses in connection with the intangible assets | 0 | 0 | ||
Amortization expense related to other intangible assets | $ 1,600,000 | $ 2,200,000 | 5,000,000 | $ 6,800,000 |
Goodwill, increased from effects of foreign currency exchange rates | $ 6,100,000 |
Short-term Borrowings and Lon_2
Short-term Borrowings and Long-term Debt - ABL Facility and Canadian Sub-Facility (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | |
Debt Instruments | ||||
Remaining aggregate outstanding principal amount paid | $ 213,200,000 | $ 418,986,000 | $ 437,391,000 | |
Loss on extinguishment of debt from write-off of unamortized deferred financing costs | $ (1,400,000) | (2,449,000) | $ 357,000 | |
ABL facility | ||||
Debt Instruments | ||||
Outstanding borrowing | $ 0 | 0 | ||
Revolving credit facility | $ 481,700,000 | 481,700,000 | ||
Debt instrument, maturity date | May 11, 2026 | |||
Debt issuance cost before amortization | $ 1,300,000 | $ 1,300,000 |
Short-term Borrowings and Lon_3
Short-term Borrowings and Long-term Debt - (Details) - USD ($) $ in Thousands | Apr. 01, 2021 | Mar. 31, 2021 | Jun. 30, 2021 | Jun. 30, 2020 |
Debt Instruments | ||||
Loss on extinguishment of debt from write-off of unamortized deferred financing costs | $ (1,400) | $ (2,449) | $ 357 | |
Remaining aggregate outstanding principal amount paid | $ 213,200 | 418,986 | $ 437,391 | |
Senior notes due Nov. 2023 | ||||
Debt Instruments | ||||
Outstanding balance amount | $ 197,400 | |||
Interest rate | 5.50% | |||
Loss on extinguishment of debt from write-off of unamortized deferred financing costs | $ (2,800) | |||
Call premium | 1,800 | |||
Write off of unamortized debt issuance costs | $ 1,000 | |||
Term Loan B | ||||
Debt Instruments | ||||
Loss on extinguishment of debt from write-off of unamortized deferred financing costs | (100) | |||
Remaining aggregate outstanding principal amount paid | 8,300 | |||
Revolving credit facility | $ 414,400 |
Derivative Instruments and He_3
Derivative Instruments and Hedging Activities - (Details) | 3 Months Ended | 9 Months Ended | |
Jun. 30, 2021USD ($)instrument | Jun. 30, 2021USD ($)instrument | Jul. 31, 2017USD ($)derivative | |
Derivative Instruments | |||
Number of derivative instruments held | instrument | 0 | 0 | |
Foreign Currency Forwards | |||
Derivative Instruments | |||
Notional Amount | $ 9,649,000 | $ 9,649,000 | |
Interest rate caps | Variable-rate tranche | Sally Holdings, LLC | |||
Derivative Instruments | |||
Notional Amount | $ 550,000,000 | ||
Derivative instruments, expiration date | Jun. 30, 2023 | ||
Number of interest rate caps | derivative | 2 | ||
Interest rate caps | Term loan B variable tranche | Sally Holdings, LLC | |||
Derivative Instruments | |||
Interest rate caps designated as cash flow hedges to be reclassified into interest expense over next 12 months | 1,600,000 | $ 1,600,000 | |
Reclassification out of Accumulated Other Comprehensive Income | Foreign Currency Forwards | |||
Derivative Instruments | |||
Foreign currency forwards designated as cash flow hedges to be reclassified gain (loss) into cost of goods sold | (300,000) | 100,000 | |
Foreign currency forwards designated as cash flow hedges to be reclassified losses into cost of goods sold over next 12 months | $ 1,000,000 | $ 1,000,000 |
Derivative Instruments and He_4
Derivative Instruments and Hedging Activities - Schedule of Notional Amount Held Through Foreign Currency Forwards, Based Upon Exchange Rates (Details) $ in Thousands | Jun. 30, 2021USD ($) |
Foreign Currency Forwards | |
Foreign Currency Fair Value Hedge Derivative [Line Items] | |
Notional Amount | $ 9,649 |
Euro | |
Foreign Currency Fair Value Hedge Derivative [Line Items] | |
Notional Amount | 4,558 |
Mexican Peso | |
Foreign Currency Fair Value Hedge Derivative [Line Items] | |
Notional Amount | 3,698 |
Canadian Dollar | |
Foreign Currency Fair Value Hedge Derivative [Line Items] | |
Notional Amount | $ 1,393 |
Business Segments (Details)
Business Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Net sales: | ||||
Total net sales | $ 1,022,387 | $ 705,287 | $ 2,884,737 | $ 2,556,518 |
Segment operating earnings: | ||||
Segment operating earnings | 127,417 | 1,431 | 307,250 | 139,083 |
Restructuring | 508 | 5,816 | 1,371 | 11,541 |
Interest expense | 23,452 | 27,298 | 73,313 | 70,483 |
Earnings (loss) before provision for income taxes | 103,965 | (25,867) | 233,937 | 68,600 |
Operating segments | ||||
Segment operating earnings: | ||||
Segment operating earnings | 172,049 | 43,171 | 463,655 | 277,241 |
Corporate | ||||
Segment operating earnings: | ||||
Unallocated expenses | 44,124 | 35,924 | 155,034 | 126,617 |
Sally Beauty Supply | ||||
Net sales: | ||||
Total net sales | 602,681 | 415,468 | 1,693,015 | 1,504,125 |
Sally Beauty Supply | Operating segments | ||||
Segment operating earnings: | ||||
Segment operating earnings | 116,784 | 3,087 | 311,975 | 133,684 |
Beauty Systems Group | ||||
Net sales: | ||||
Total net sales | 419,706 | 289,819 | 1,191,722 | 1,052,393 |
Beauty Systems Group | Operating segments | ||||
Segment operating earnings: | ||||
Segment operating earnings | $ 55,265 | $ 40,084 | $ 151,680 | $ 143,557 |
Business Segments - Schedule of
Business Segments - Schedule of Disaggregation of Net Sales by Segment (Details) - Sales Revenue, Net | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Sally Beauty Supply | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 100.00% | 100.00% | 100.00% | 100.00% |
Sally Beauty Supply | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 100.00% | 100.00% | 100.00% | 100.00% |
Sally Beauty Supply | Hair color | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 35.60% | 36.60% | 35.30% | 33.80% |
Sally Beauty Supply | Hair care | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 18.90% | 16.30% | 18.80% | 19.00% |
Sally Beauty Supply | Skin and nail care | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 14.60% | 13.30% | 12.20% | 13.80% |
Sally Beauty Supply | Styling tools | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 11.60% | 13.60% | 14.30% | 13.00% |
Sally Beauty Supply | Salon supplies and accessories | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 7.60% | 9.10% | 7.70% | 7.50% |
Sally Beauty Supply | Textured hair products | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 5.80% | 4.70% | 5.90% | 5.10% |
Sally Beauty Supply | Other Beauty items | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 5.90% | 6.40% | 5.80% | 7.80% |
Sally Beauty Supply | Sales channel, directly to consumer | Company-operated stores | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 94.20% | 79.10% | 93.70% | 90.90% |
Sally Beauty Supply | Sales channel, through intermediary | E-commerce | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 5.70% | 20.80% | 6.20% | 8.90% |
Sally Beauty Supply | Sales channel, through intermediary | Franchise stores | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 0.10% | 0.10% | 0.10% | 0.20% |
Beauty Systems Group | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 100.00% | 100.00% | 100.00% | 100.00% |
Beauty Systems Group | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 100.00% | 100.00% | 100.00% | 100.00% |
Beauty Systems Group | Hair color | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 45.10% | 42.20% | 43.20% | 39.70% |
Beauty Systems Group | Hair care | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 36.60% | 32.50% | 36.50% | 34.20% |
Beauty Systems Group | Skin and nail care | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 6.80% | 8.20% | 7.30% | 8.20% |
Beauty Systems Group | Styling tools | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 6.30% | 6.20% | 6.50% | 6.40% |
Beauty Systems Group | Other Beauty items | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 2.60% | 7.00% | 2.50% | 3.90% |
Beauty Systems Group | Promotional items | Product Concentration Risk | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 2.60% | 3.90% | 4.00% | 7.60% |
Beauty Systems Group | Sales channel, directly to consumer | Company-operated stores | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 69.20% | 63.90% | 69.70% | 68.20% |
Beauty Systems Group | Sales channel, through intermediary | E-commerce | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 8.80% | 17.40% | 8.80% | 8.90% |
Beauty Systems Group | Sales channel, through intermediary | Franchise stores | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 7.90% | 7.90% | 7.50% | 7.40% |
Beauty Systems Group | Sales channel, through intermediary | Distributor sales consultants | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of net sales | 14.10% | 10.80% | 14.00% | 15.50% |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||||
Effective tax rate | 26.70% | 9.10% | 26.60% | 37.20% |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation for More Details Relating to Period Over Period Differences in Effective Tax Rate (Details) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||||
U.S. federal statutory income tax rate | 21.00% | 21.00% | 21.00% | 21.00% |
State income taxes, net of federal tax benefit | 3.20% | 2.90% | 3.30% | 3.90% |
Effect of foreign operations | 1.10% | 4.60% | 0.90% | (0.50%) |
Foreign valuation allowances | 0.50% | (13.00%) | 0.30% | 10.20% |
Deemed repatriation tax | (1.10%) | 0.40% | ||
Other, net | 0.90% | (5.30%) | 1.10% | 2.20% |
Effective tax rate | 26.70% | 9.10% | 26.60% | 37.20% |
Subsequent Event - Additional I
Subsequent Event - Additional Information (Details) - 2017 Share Repurchase program - USD ($) | Jul. 22, 2021 | Aug. 31, 2017 |
Subsequent Event [Line Items] | ||
Stock repurchase program, expiration date | Sep. 30, 2021 | |
Amount of shares authorized to be repurchased | $ 1,000,000,000 | |
Term of share repurchase program | 4 years | |
Subsequent Event | ||
Subsequent Event [Line Items] | ||
Stock repurchase program, expiration date | Sep. 30, 2025 | |
Term of share repurchase program | 4 years | |
Amount of shares remaining, authorized to be repurchased | $ 726,100,000 |