Categories: Earnings

Sally Beauty Holdings Sees Q3 Net Sales Drop 28 Pct YOY

Sally Beauty Holdings Inc. reported that its net sales fell in the third quarter to $705.3 million, a nearly 28 percent drop compared to the same period one year ago, amid a shutdown of almost all of its stores for much of the quarter.

The Texas-based beauty supplier reported on Thursday (July 30) that its losses were partially offset by a surge in online sales and the opening of its shops from mid-April through the end of June.

eCommerce sales were $137 million for Q3, a 278 percent increase from the prior year.

As a result of COVID-19, same-store sales dropped by 26.6 percent for Q3. But given the number of stores that were open, the company said it experienced strong demand in June at 10.8 percent as operations restarted.

GAAP diluted earnings per share in Q3 fell by $0.21, compared to a profit of $0.59 in the prior year.

“We executed exceptionally well during a disrupted third quarter,” said Chris Brickman, CEO and president, in a statement. "The team aggressively managed costs and cash, drove an accelerated pivot to support digital growth and scale our key digital transformation initiatives, and reopened the store network faster than competitors. … as we enter the fourth quarter, we will continue to invest in our digital transformation, take advantage of the strong demand for our key categories, adapt quickly to any new local restrictions or changes to consumer shopping behavior tied to the pandemic, and stay disciplined in terms of cost and cash management.”

At the close of Q3, Sally Beauty Holdings had $839 million of cash on its balance sheets, compared to $364 million at the end of the second quarter.

The company said it reduced inventory levels to a six-year low by the end of June. In addition, it reduced capital spend that was not tied to digital investments. As a result, Sally achieved rent abatements and reduced its marketing and back-office costs.

As of June 30, all stores in the U.S., Canada, the European Union and the United Kingdom were reopened. The company adopted COVID-19 safety protocols including store cleaning, mask and glove-wearing, limitations on numbers of customers and in-store social distancing.

Get our hottest stories delivered to your inbox.

Sign up for the PYMNTS.com Newsletter to get updates on top stories and viral hits.

——————————

NEW PYMNTS STUDY: LEVERAGING THE DIGITAL BANKING SHIFT – SEPTEMBER 2020

The September 2020 Leveraging The Digital Banking Shift Study, PYMNTS examines consumers’ growing use of online and mobile tools to open and manage accounts as well as the factors that are paramount in building and maintaining trust in the current economic environment. The report is based on a survey of nearly 2,200 account-holding U.S. consumers.

Recent Posts

The Outside-The-Box Ways The World Is Beating Boredom

The late William F. Buckley Jr. famously once said that “boredom is the deadliest poison.”…

1 day ago

Hims Inc. May Go Public Through Blank-Check Company

Remote healthcare firm Hims Inc. is getting close to an arrangement to go public via…

2 days ago

Decision On TikTok Ban Coming Sunday

The high-stakes court decision on whether to allow a ban of video-sharing app TikTok set to…

2 days ago

NYC Could Close Nonessential Businesses In Some Areas If Pandemic Outbreak Grows

New York City might shutter nonessential businesses in multiple districts and prohibit groups of over…

2 days ago

PayPal Provides $5M In Grants To Support Minority Businesses

PayPal Holdings Inc. provided $5 million in grants to support Black-owned businesses in the U.S.…

2 days ago

Fed Sees Possible Path To ‘Direct Issuance’ Of Digital Dollars

Digital dollars could make the leap from concept to reality, but there might be a…

2 days ago