UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED: MARCH 31, 2024
or
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File No. 1-33145
SALLY BEAUTY HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
Delaware
36-2257936
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
3001 Colorado Boulevard
Denton, Texas
76210
(Address of principal executive offices)
(Zip Code)
(940) 898-7500
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol
Name of each exchange on which registered
Common Stock, $0.01 par value
SBH
The New York Stock Exchange
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Accelerated filer
Non-accelerated filer
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
Number of shares of common stock outstanding as of May 3, 2024: 103,514,140
TABLE OF CONTENTS
Page
PART I — FINANCIAL INFORMATION
Item 1. Financial Statements
4
Condensed Consolidated Balance Sheets
Condensed Consolidated Statements of Earnings
5
Condensed Consolidated Statements of Comprehensive Income
6
Condensed Consolidated Statements of Stockholders’ Equity
7
Condensed Consolidated Statements of Cash Flows
8
Notes to Condensed Consolidated Financial Statements
9
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
17
Item 3. Quantitative and Qualitative Disclosures About Market Risk
24
Item 4. Controls and Procedures
PART II — OTHER INFORMATION
Item 1. Legal Proceedings
25
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities.
Item 5. Other Information
Item 6. Exhibits
26
2
In this Quarterly Report, references to “the Company,” “Sally Beauty,” “our company,” “we,” “our,” “ours” and “us” refer to Sally Beauty Holdings, Inc. and its consolidated subsidiaries unless otherwise indicated or the context otherwise requires.
cautionary notice regarding forward-looking statements
Statements in this Quarterly Report on Form 10-Q and in the documents incorporated by reference herein which are not purely historical facts or which depend upon future events may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which we refer to as the Exchange Act. Words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “project,” “target,” “can,” “could,” “may,” “should,” “will,” “would” or similar expressions may also identify such forward-looking statements.
Readers are cautioned not to place undue reliance on forward-looking statements as such statements speak only as of the date they were made and involve risks and uncertainties that could cause actual events or results to differ materially from the events or results described in the forward-looking statements. The most important factors which could cause our actual results to differ from our forward-looking statements are set forth in our description of risk factors in Item 1A contained in our Annual Report on Form 10-K for the fiscal year ended September 30, 2023, which should be read in conjunction with the forward-looking statements in this report. Forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update any forward-looking statement.
The events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. As a result, our actual results may differ materially from the results contemplated by these forward-looking statements.
3
Item 1. Financial Statements.
SALLY BEAUTY HOLDINGS, INC. AND SUBSIDIARIES
(In thousands, except par value data)
March 31,2024
September 30,2023
(Unaudited)
Assets
Current assets:
Cash and cash equivalents
$
97,174
123,001
Trade accounts receivable, net
34,693
33,421
Accounts receivable, other
52,868
42,454
Inventory
1,039,752
975,218
Other current assets
55,836
53,903
Total current assets
1,280,323
1,227,997
Property and equipment, net of accumulated depreciation of $833,581 at March 31, 2024, and $780,212 at September 30, 2023
273,175
297,779
Operating lease assets
562,770
570,657
Goodwill
534,494
533,081
Intangible assets, excluding goodwill, net of accumulated amortization of $31,821 at March 31, 2024, and $30,587 at September 30, 2023
54,088
55,171
Other assets
41,692
40,565
Total assets
2,746,542
2,725,250
Liabilities and Stockholders’ Equity
Current liabilities:
Current maturities of long-term debt
66,164
4,173
Accounts payable
289,606
258,884
Accrued liabilities
150,002
163,366
Current operating lease liabilities
137,631
150,479
Income taxes payable
366
2,355
Total current liabilities
643,769
579,257
Long-term debt
978,360
1,065,811
Long-term operating lease liabilities
458,030
455,071
Other liabilities
21,626
23,139
Deferred income tax liabilities, net
93,907
93,224
Total liabilities
2,195,692
2,216,502
Stockholders’ equity:
Common stock, $0.01 par value. Authorized 500,000 shares; 103,514 and 106,266 shares issued and shares outstanding at March 31, 2024, and September 30, 2023, respectively
1,035
1,063
Preferred stock, $0.01 par value. Authorized 50,000 shares; none issued
—
Additional paid-in capital
5,677
Accumulated earnings
666,647
624,772
Accumulated other comprehensive loss, net of tax
(116,832
)
(122,764
Total stockholders’ equity
550,850
508,748
Total liabilities and stockholders’ equity
The accompanying notes are an integral part of these condensed consolidated financial statements.
(In thousands, except per share data)
Three Months Ended
Six Months Ended
March 31,
2024
2023
Net sales
908,361
918,712
1,839,663
1,875,767
Cost of goods sold
445,289
450,373
909,415
918,854
Gross profit
463,072
468,339
930,248
956,913
Selling, general and administrative expenses
403,435
389,657
801,573
781,237
Restructuring
63
7,274
(22
17,680
Operating earnings
59,574
71,408
128,697
157,996
Interest expense
20,523
16,685
37,837
34,608
Earnings before provision for income taxes
39,051
54,723
90,860
123,388
Provision for income taxes
9,807
13,862
23,226
32,190
Net earnings
29,244
40,861
67,634
91,198
Earnings per share:
Basic
0.28
0.38
0.64
0.85
Diluted
0.27
0.37
0.63
0.83
Weighted-average shares:
104,276
107,453
105,117
107,294
107,080
109,706
107,881
109,499
(In thousands)
Other comprehensive income (loss):
Foreign currency translation adjustments
(6,928
9,445
7,449
35,386
Interest rate swap, net of tax
1,584
(1,504
Interest rate caps, net of tax
(2,163
(1,960
Foreign exchange contracts, net of tax
468
(1,017
(13
(1,927
Other comprehensive income (loss), net of tax
(4,876
6,265
5,932
31,499
Total comprehensive income
24,368
47,126
73,566
122,697
Accumulated
Additional
Other
Total
Common Stock
Paid-in
Comprehensive
Stockholders’
Shares
Amount
Capital
Earnings
Loss
Equity
Balance at September 30, 2023
106,266
38,390
Other comprehensive income
10,808
Share-based compensation
5,118
Stock issued for equity awards
722
209
216
Employee withholding taxes paid related to net share settlement
(192
(2
(1,738
(1,740
Repurchases and cancellations of common stock
(1,939
(19
(9,266
(10,915
(20,200
Balance at December 31, 2023
104,857
1,049
652,247
(111,956
541,340
Other comprehensive loss
3,964
184
1,396
1,398
(1
(20
(1,526
(15
(5,341
(14,844
Balance at March 31, 2024
103,514
Balance at September 30, 2022
106,970
1,070
4,241
440,172
(151,847
293,636
50,337
25,234
5,135
404
78
82
(90
(1,125
(1,126
Balance at December 31, 2022
107,284
1,073
8,329
490,509
(126,613
373,298
3,838
266
1,638
1,641
Balance at March 31, 2023
107,549
1,076
13,790
531,370
(120,348
425,888
Six Months Ended March 31,
Cash Flows from Operating Activities:
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization
55,017
50,347
Share-based compensation expense
9,082
8,973
Amortization of deferred financing costs
1,272
1,311
Loss on early extinguishment of debt
2,037
601
Impairment of long-lived assets, including operating lease assets
1,765
Loss on disposal of equipment and other property
Deferred income taxes
171
862
Changes in (exclusive of effects of acquisitions):
Trade accounts receivable
(1,054
4,632
(10,141
(5,805
(59,741
(68,355
(1,412
6,053
(1,792
2,201
Operating leases, net
(2,072
(14,286
Accounts payable and accrued liabilities
32,314
108
(1,842
434
(1,516
(393
Net cash provided by operating activities
87,960
79,648
Cash Flows from Investing Activities:
Payments for property and equipment, net of proceeds
(44,659
(42,181
Acquisitions, net of cash acquired
(218
Net cash used by investing activities
(44,877
Cash Flows from Financing Activities:
Proceeds from issuance of long-term debt
1,056,000
853,000
Repayments of long-term debt
(1,076,054
(898,093
Debt issuance costs
(8,332
(4,726
Proceeds from equity awards
1,614
1,723
Payments for common stock repurchased
(40,400
Employee withholding taxes paid related to net share settlement of equity awards
(1,760
(1,141
Net cash used by financing activities
(68,932
(49,237
Effect of foreign exchange rate changes on cash and cash equivalents
22
2,832
Net decrease in cash and cash equivalents
(25,827
(8,938
Cash and cash equivalents, beginning of period
70,558
Cash and cash equivalents, end of period
61,620
Supplemental Cash Flow Information:
Interest paid
48,253
35,191
Income taxes paid
32,007
32,077
Capital expenditures incurred but not paid
16,992
5,466
Sally Beauty Holdings, Inc. and Subsidiaries
1. Significant Accounting Policies
Basis of Presentation
The unaudited condensed consolidated interim financial statements of Sally Beauty Holdings, Inc. and its subsidiaries 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 for the interim period presented. 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, 2023. In the opinion of management, these unaudited 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 March 31, 2024, and September 30, 2023, our consolidated results of operations, consolidated comprehensive income and consolidated statements of stockholders’ equity for the three and six months ended March 31, 2024 and 2023, and consolidated cash flows for the six months ended March 31, 2024 and 2023.
Principles of Consolidation
The unaudited condensed consolidated interim financial statements include all accounts of Sally Beauty Holdings, Inc. and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. All amounts are in U.S. Dollars.
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 our estimated annual effective income tax.
Use of Estimates
In order to present our financial statements in conformity with GAAP, we are required to make certain estimates and assumptions that impact our interim financial statements and supplementary disclosures. These estimates may use forecasted financial information based on reasonable information available, however are subject to change in the future. Significant estimates and assumptions are part of our accounting for sales allowances, deferred revenue, valuation of inventory, amortization and depreciation, intangibles and goodwill, and other reserves. We believe these estimates and assumptions are reasonable; however, they are based on management’s current knowledge of events and actions, and changes in facts and circumstances may result in revised estimates and impact actual results.
2. Recent Accounting Pronouncements
In November 2023, the Financial Accounting Standards Board (“FASB”) issued accounting standards update (“ASU”) No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, to enhance segment disclosures for annual and interim consolidated financial statements, including significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”). For public companies, the amendments in the update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. We are currently evaluating the impact of this update, but do not expect the update to impact our consolidated results of operations or financial position.
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, to expand disclosures in an entity’s income tax rate reconciliation table and the disaggregation of taxes paid in U.S. and foreign jurisdictions. For public business entities, the amendments in this update are effective for annual periods beginning after December 15, 2024. Early adoption is permitted. We are currently evaluating the impact of this update, but do not expect the update to impact our consolidated results of operations or financial position.
3. 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, which are included in accrued liabilities in our condensed consolidated balance sheets, for the periods were as follows (in thousands):
Beginning Balance
14,038
13,460
Loyalty points and gift cards issued but not redeemed, net of estimated breakage
8,700
9,327
Revenue recognized from beginning liability
(9,997
(8,370
Ending Balance
12,741
14,417
See Note 11, Segment Reporting, for additional information regarding the disaggregation of our sales revenue.
4. Fair Value Measurements
We measure on a recurring basis and disclose the fair value of our financial instruments under the provisions of ASC Topic 820, Fair Value Measurement, as amended (“ASC 820”). We define “fair value” as the price that would be received to sell an asset or paid to transfer a liability (i.e., the exit price) in an orderly transaction between market participants at the measurement date. ASC 820 establishes a three-level hierarchy for measuring fair value and requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. This valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability on the measurement date.
The three levels of that hierarchy are defined as follows:
Level 1 - Quoted prices are available in active markets for identical assets or liabilities;
Level 2 - Pricing inputs are other than quoted prices in active markets, included in Level 1, that are either directly or indirectly observable; and
Level 3 - Unobservable pricing inputs in which little or no market activity exists, therefore requiring an entity to develop its own model with estimates and assumptions.
Financial instruments measured at fair value on recurring basis
Consistent with the fair value hierarchy, we categorized our financial assets and liabilities as follow:
(in thousands)
Classification
Fair Value Hierarchy Level
Financial Assets:
Foreign exchange contracts
Non-designated cash flow hedges
Level 2
483
1,160
Interest rate swap
2,920
4,668
3,403
5,828
.
Financial Liabilities:
Designated cash flow hedges
1,301
685
397
1,986
The fair value of each asset and liability were measured using widely accepted valuation techniques, such as discounted cash flow analyses and observable inputs, such as market interest rates and foreign exchange rates.
10
Other fair value disclosures
The carrying amounts of cash equivalents, trade and other accounts receivable, and accounts payable and borrowing under our ABL facility approximate their respective fair values due to the short-term nature of these financial instruments. Carrying amounts and the related estimated fair value of our long-term debt, excluding finance lease obligations, debt issuance costs and original issue discounts, are as follows:
March 31, 2024
September 30, 2023
Carrying Value
Fair Value
Long-term debt, excluding finance lease obligations
Senior notes
Level 1
600,000
593,250
679,961
662,962
Term loan B due 2030
396,000
395,505
398,000
Total long-term debt
996,000
988,755
1,077,961
1,060,962
The fair values of our term loans were measured using quoted market prices for similar debt securities in active markets or widely accepted valuation techniques, such as discounted cash flow analyses, using observable inputs, such as market interest rates.
5. Stockholders’ Equity
Share Repurchases
In August 2017, our Board of Directors (“Board”) approved a share repurchase program authorizing us to repurchase up to $1.0 billion of our common stock, subject to certain limitations governed by our debt agreements. In July 2021, our Board approved a term extension of our share repurchase program to September 30, 2025. As of March 31, 2024, we had approximately $540.8 million of additional share repurchase authorizations remaining under our share repurchase program. For the three and six months ended March 31, 2024, we repurchased 1.5 million and 3.5 million shares of our common stock at a total cost of $20.0 million and $40.0 million, respectively, excluding the impact of excise taxes. For the three and six months ended March 31, 2023, we did not repurchase shares under our share repurchase program.
Accumulated Other Comprehensive Loss
The change in accumulated other comprehensive loss (“AOCL”) was as follows (in thousands):
Foreign Currency Translation Adjustments
Interest Rate Swap
Foreign Exchange Contracts
(124,846
3,716
(1,634
Other comprehensive income (loss) before reclassification, net of tax
152
(2,042
5,559
Reclassification to net earnings, net of tax
(1,656
2,029
373
(117,397
2,212
(1,647
The tax impact for the changes in other comprehensive income (loss) and the reclassifications to net earnings was not material.
6. Weighted-Average Shares
The following table sets forth the reconciliation of basic and diluted weighted-average shares (in thousands):
Three Months EndedMarch 31,
Six Months EndedMarch 31,
Weighted-average basic shares
Dilutive securities:
Stock option and stock award programs
2,804
2,253
2,764
2,205
Weighted-average diluted shares
Anti-dilutive options excluded from our computation of diluted shares
1,733
1,964
1,754
11
7. Goodwill and Intangible Assets
During the three months ended March 31, 2024, we completed our annual assessments for impairment of goodwill and indefinite-lived intangible assets. For our goodwill testing, we performed a qualitative analysis and determined that there was no indication of impairment requiring further quantitative testing. No material impairment losses were recognized in the current or prior periods presented in connection with our goodwill and intangible assets.
At September 30, 2023, we determined that due to the recent decline in the Company's share price and market capitalization, among other factors, a quantitative assessment was required. Based on our September 30, 2023, quantitative assessment using a discounted cash flow, we estimated the fair value for our BSG reporting unit to be approximately 18% more than its carrying value. The critical assumptions used as part of our evaluation included a projected long-term revenue growth rate of 2.0% and a discount rate of 11.25%, based on a weighted-average cost of capital analysis (adjusted for company specific risk). Our September 30, 2023, quantitative assessment indicated that the fair value of our SBS segment was substantially higher than its carrying value. Goodwill allocated to our SBS and BSG reporting units, which are also defined as our SBS and BSG segment, was $84.9 million and $449.6 million, respectively, as of March 31, 2024.
Intangible assets amortization expense
791
866
1,651
1,875
For the six months ended March 31, 2024, changes in goodwill reflects the effects of foreign currency exchange rates of $1.8 million and adjustments of $0.4 million from the completion of our Goldwell of NY, Inc. acquisition fair value assessment. Additionally, the changes to other intangibles included effects of foreign currency exchange rates of $0.8 million.
8. Accrued Liabilities
Accrued liabilities consist of the following (in thousands):
Compensation and benefits
63,758
69,915
Deferred revenue
17,874
18,259
Rental obligations
10,677
11,266
Insurance reserves
6,931
6,656
Interest payable
4,758
13,447
Property and other taxes
1,379
2,617
Operating accruals and other
44,625
41,206
Total accrued liabilities
9. Short-term and Long-term Debt
At March 31, 2024, our ABL facility had $62.0 million in outstanding borrowings and $420.6 million available for borrowing, including the Canadian sub-facility, subject to borrowing base limitation, as reduced by outstanding letters of credit.
On February 12, 2024, we announced a registered public offering of 6.75% senior notes due 2032 (“2032 Senior Notes”). This offering was made pursuant to a shelf registration statement on Form S-3 filed with the SEC on May 10, 2021. On February 27, 2024, we closed on the 2032 Senior Notes and received $594.0 million in cash proceeds net of underwriter fees. The proceeds were used to repay the outstanding $680.0 million principal balance on the 5.625% Senior Notes due 2025 (the “2025 Senior Notes”). The 2032 Senior Notes were issued at par and bear interest at a fixed interest rate of 6.75%. Interest is paid semi-annually during our second and fourth fiscal quarters. The 2032 Senior Notes are guaranteed on a senior secured basis by the guarantors who have guaranteed obligations under our senior secured credit facilities and our existing notes. In connection with the issuance, we incurred approximately $8.8 million in debt issuance costs that is being amortized using the effective interest rate method through the life of the notes.
Additionally on February 12, 2024, we issued a notice to redeem the entire $680.0 million aggregate outstanding principal amount of the 2025 Senior Notes that remained outstanding on March 13, 2024, at a redemption price equal to 100.00% of the principal amount of the 2025 Senior Notes, plus accrued and unpaid interest to, but not including, the redemption date. On March 13, 2024, we redeemed the 2025 Senior Notes with the proceeds of our newly-issued 2032 Senior Notes, cash on hand prior to the new 2032 Senior Notes, and ABL borrowings. In connection with this redemption, we recognized a $2.0 million loss on the extinguishment of debt within interest expense related to unamortized debt issuance costs.
12
10. Derivative Instruments and Hedging Activities
During the six months ended March 31, 2024, we did not purchase or hold any derivative instruments for trading or speculative purposes. See Note 4, Fair Value Measurements, for the classification and fair value of our derivative instruments.
Designated Cash Flow Hedges
Foreign Currency Forwards
We regularly enter into foreign currency forwards to mitigate our exposure to exchange rate changes on forecasted inventory purchases in U.S. dollars by our foreign subsidiaries. At March 31, 2024, we held forwards, which expire ratably through September 30, 2024, with a notional amount, based upon exchange rates at March 31, 2024, as follows (in thousands):
Notional Currency
Notional Amount
Mexican Peso
11,490
Euro
5,597
Canadian Dollar
5,505
22,592
Quarterly, the changes in fair value related to these foreign currency forwards are recorded into AOCL. As the forwards are exercised, the realized value is recognized into cost of goods sold, based on inventory turns, in our condensed consolidated statements of earnings. For the three months ended March 31, 2024 and 2023, we recognized a loss of $0.6 million and a loss of $0.2 million, respectively. For the six months ended March 31, 2024 and 2023, we recognized a loss of $2.0 million and a gain of $0.1 million, respectively. Based on March 31, 2024, valuations and exchange rates, we expect to reclassify losses of approximately $1.8 million out of AOCL and into cost of goods sold over the next 12 months.
In April 2023, we entered into a three-year interest rate swap with an initial notional amount of $200 million (the “interest rate swap”) to mitigate the exposure to higher interest rates in connection with our Term Loan B due in 2030. The interest rate swap involves fixed monthly payments at the contract rate of 3.705%, and in return, we will receive a floating interest payment based on the 1-month Adjusted Term SOFR Rate. The interest rate swap will mature in April 2026 and is designated as a cash flow hedge. Changes in the fair value of the interest rate swap are recorded quarterly, net of income tax, and included in AOCL.
For the three and six months ended March 31, 2024, we recognized income of $0.8 million and $1.7 million, respectively, into interest expense on our condensed consolidated statements of earnings related to the interest rate swap. At March 31, 2024, we expect to reclassify gains of approximately $2.4 million out of AOCL and into interest expense 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 prior term loan due 2024. The interest rate caps were comprised of individual caplets and were designated as cash flow hedges. Accordingly, the changes in fair value of the interest rate caps were recorded quarterly, net of income tax, and included in AOCL. During fiscal year 2023, we early settled both interest rate caps due to the forecasted transactions being hedged no longer occurring as a result of the repayment of our prior term loan. The effects of our interest rate caps on our condensed consolidated statements of earnings were not material for the three months ended March 31, 2023. For the six months ended March 31, 2023, we recognized income of $2.8 million into interest expense on our condensed consolidated statements of earnings related to the caps.
Non-Designated Derivative Instruments
We also use foreign exchange contracts to mitigate our exposure to exchange rate changes in connection with certain intercompany balances not permanently invested. At March 31, 2024, we held forwards, which settle on various dates in the first month of the next two fiscal quarters, with a notional amount, based upon exchange rates at March 31, 2024, as follows (in thousands):
British Pound
44,761
22,547
20,928
17,009
105,245
We record changes in fair value and realized gains or losses related to these foreign currency forwards into selling, general and administrative expenses. For the three months ended March 31, 2024 and 2023, the effects of these foreign exchange contracts on our condensed consolidated financial statements were losses of $0.3 million and losses of $1.5 million, respectively. For the six months
13
ended March 31, 2024 and 2023, the effects of these foreign exchange contracts on our condensed consolidated financial statements were losses of $1.6 million and losses of $1.1 million, respectively.
11. Segment Reporting
Segment data for the three and six months ended March 31, 2024 and 2023, is as follows (in thousands):
Three Months Ended March 31,
Net sales:
Sally Beauty Supply ("SBS")
513,241
530,246
1,036,479
1,079,718
Beauty Systems Group ("BSG")
395,120
388,466
803,184
796,049
Earnings before provision for income taxes:
Segment operating earnings:
SBS
76,820
92,134
154,449
191,308
BSG
43,015
37,260
87,642
86,907
Segment operating earnings
119,835
129,394
242,091
278,215
Unallocated expenses
60,198
50,712
113,416
102,539
Consolidated operating earnings
Sales between segments, which are eliminated in consolidation, were not material during the three and six months ended March 31, 2024 and 2023.
14
Disaggregation of net sales by segment
Periodically, we make minor adjustments to our product hierarchy, that impacts the roll-up of our merchandise categories. As a result, certain prior year amounts have been reclassified to conform to current year presentation. The following tables disaggregate our segment revenues by merchandise category.
Hair color
39.6
%
39.8
39.2
Hair care
25.2
24.3
24.6
23.9
Styling tools and supplies
17.0
17.9
17.6
18.7
Nail
9.9
10.0
10.2
Skin and cosmetics
7.9
7.5
8.0
7.4
Other beauty items
0.4
0.5
0.6
100.0
41.8
42.0
42.4
42.8
41.5
40.6
40.4
39.4
10.6
10.8
10.7
3.5
3.7
3.9
4.1
2.3
2.7
2.4
0.3
0.2
The following tables disaggregate our segment revenue by sales channels:
Company-operated stores
93.4
93.6
93.3
E-commerce
6.6
6.4
6.7
67.8
67.5
68.2
66.9
14.1
13.7
13.9
Distributor sales consultants
10.5
11.4
12.0
Franchise stores
7.6
7.3
15
12. Restructuring
Restructuring expenses, included in Cost of Goods Sold (“COGS”) and Restructuring for the three and six months ended March 31, 2024 and 2023, are as follows (in thousands):
Included in COGS (a)
Distribution Center Consolidation and Store Optimization Plan
(2,362
(5,042
Included in Restructuring (b)
In the fourth quarter of fiscal year 2022, our Board approved the Distribution Center Consolidation and Store Optimization Plan (“the Plan”) authorizing the closure of 330 SBS stores and 35 BSG stores, and the closure of two BSG distribution centers in Clackamas, Oregon and Pottsville, Pennsylvania. Stores identified for early closure were part of a strategic evaluation which included a market analysis of certain locations where we believed we would be able to recapture demand and improve profitability.
The Plan has been substantially completed, as the remaining two BSG stores were closed earlier this fiscal year. However, we may still incur future immaterial charges related to store closures such as exit costs, lease negotiation penalties and adjustments to estimates. As of March 31, 2024, there were no material outstanding liabilities for exit costs or involuntary employee termination benefits.
16
This section discusses management’s view of the financial condition, results of operations and cash flows of Sally Beauty for the periods covered by this Quarterly Report. 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, 2023, including the Risk Factors sections therein, and information contained elsewhere in this Quarterly Report, including the condensed consolidated interim financial statements and notes to those financial statements.
Financial Summary for the Three Months Ended March 31, 2024
Comparable Sales
We believe that comparable sales is an appropriate performance indicator to measure our sales growth compared to the prior period. Our comparable sales include sales from stores that have been operating for 14 months or longer as of the last day of a month and from e-commerce revenue. Additionally, comparable sales include sales to franchisees and full service sales. Our comparable sales excludes the effect of changes in foreign exchange rates and sales from stores relocated until 14 months after the relocation. Revenue from acquired stores are excluded from our comparable sales calculation until 14 months after the acquisition. Our calculation of comparable sales might not be the same as other retailers as the calculation varies across the retail industry.
Overview
Key Operating Metrics
The following table sets forth, for the periods indicated, information concerning key measures we rely on to evaluate our operating performance (dollars in thousands):
Increase (Decrease)
(17,005
(3.2
)%
(43,239
(4.0
6,654
1.7
7,135
0.9
Consolidated
(10,351
(1.1
(36,104
(1.9
Gross profit:
307,578
317,117
(9,539
(3.0
614,138
640,592
(26,454
(4.1
155,494
151,222
4,272
2.8
316,110
316,321
(211
(0.1
(5,267
(26,665
(2.8
Segment gross margin:
59.9
59.8
bps
59.3
38.9
50
39.7
(30)
51.0
50.6
(40)
Net earnings:
(15,314
(16.6
(36,859
(19.3
5,755
15.4
735
0.8
(9,559
(7.4
(36,124
(13.0
Unallocated expenses and restructuring(a)
60,261
57,986
2,275
113,394
120,219
(6,825
(5.7
(11,834
(29,299
(18.5
23.0
3,229
9.3
(15,672
(28.6
(32,528
(26.4
(4,055
(29.3
(8,964
(27.8
(11,617
(28.4
(23,564
(25.8
Comparable sales growth (decline):
9.1
(1,310)
5.9
(890)
2.0
1.3
70
(0.2
150
(1.5
5.7
(720)
3.3
(440)
Number of stores at end-of-period (including franchises):
3,134
3,143
(9
(0.3
1,334
1,341
(7
(0.5
4,468
4,484
(16
(0.4
18
Results of Operations
The Three Months Ended March 31, 2024, compared to the Three Months Ended March 31, 2023
Net Sales
SBS. The decrease in net sales for SBS was primarily driven by the following (in thousands):
Comparable sales
(21,210
Sales outside comparable sales (a)
(341
Foreign currency exchange
4,546
SBS's net sales decrease was primarily driven by a decline in comparable sales, partially offset by favorable impacts from foreign currency exchange rates. SBS’s decline in comparable sales was driven by a result of fewer transactions.
BSG. The increase in net sales for BSG was primarily driven by the following (in thousands):
7,624
(1,067
97
BSG's net sales increase was primarily driven by an increase in comparable sales, reflecting expanded distribution, new brand innovation and improving salon demand trends.
Gross Profit
SBS. SBS’s gross profit decreased for the three months ended March 31, 2024, as a result of a decrease in net sales, partially offset by a higher gross margin on units sold. SBS’s gross margin improvement was driven primarily by lower distribution and freight costs from supply chain efficiencies, partially offset by the impact of favorable adjustments to our expected obsolescence reserve related to the Plan in the prior year.
BSG. BSG’s gross profit increased for the three months ended March 31, 2024, as a result of an increase in net sales and a higher gross margin on units sold. BSG’s gross margin improvement was driven by lower distribution and freight costs from supply chain efficiencies, partially offset by lower product margins primarily from higher take rate on promotions and brand mix.
Selling, General and Administrative Expenses
SBS. SBS’s selling, general and administrative expenses increased $5.8 million, or 2.6%, for the three months ended March 31, 2024, and included an unfavorable impact from foreign exchange rates of $1.8 million. As a percentage of SBS net sales, selling, general and administrative expense for the three months ended March 31, 2024, was 45.0% compared to 42.4% for the three months ended March 31, 2023. The increase as a percentage of sales was primarily due to higher labor and rent costs.
BSG. BSG’s selling, general and administrative expenses decreased $1.5 million, or 1.3%, for the three months ended March 31, 2024. As a percentage of BSG net sales, selling, general and administrative expense for the three months ended March 31, 2024, was 28.5% compared to 29.3% for the three months ended March 31, 2023. The decrease as a percentage of sales was primarily due to lower delivery expense.
Unallocated. Unallocated selling, general and administrative expenses, which represent certain corporate costs that have not been charged to our reporting segments, increased $9.5 million, or 18.7%, for the three months ended March 31, 2024, primarily due to expenses in connection with our Fuel for Growth initiative in the current year and higher health insurance costs, partially offset by lower accrued bonus expense.
The decrease in restructuring was primarily due to the lapping of expenses incurred in connection with our Distribution Center Consolidation and Store Optimization Plan in the prior year for $7.3 million. See Note 12, Restructuring, in Item 1 of this quarterly report for more information on the Plan.
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Interest Expense
The increase in interest expense is primarily due to higher interest rates on our variable rate debt and an increase in our losses on debt extinguishment, partially offset by lower average outstanding borrowings on our ABL facility during the current quarter. See Note 9, Short-term and Long-term Debt, and Note 10, Derivative Instruments and Hedging Activities, in Item 1 of this quarterly report for more information on our debt and interest rate swap that has helped mitigate some of the additional interest costs resulting from higher interest rates.
The Six Months Ended March 31, 2024, compared to the Six Months Ended March 31, 2023
(31,089
(25,442
13,292
SBS's net sales decrease was primarily driven by the impact of lower comparable sales and store closures primarily in connection with the Plan in an amount of approximately $23.6 million, partially offset by a significant portion of these sales being recaptured in other locations included within comparable sales and a favorable impact from foreign currency exchange rates. SBS’s comparable sales decline was a result of fewer transactions, partially offset by growth in our average unit retail, driven by inflationary impacts and pricing leverage.
10,497
(3,362
BSG's net sales increase was primarily driven by an increase in comparable sales, reflecting expanded distribution, new brand innovation and improving salon demand trends, partially offset by the impact of store closures.
SBS. SBS’s gross profit decreased for the six months ended March 31, 2024, as a result of a decrease in net sales. SBS’s gross margin was flat due to lower distribution and freight costs from supply chain efficiencies, offset by the impact of favorable adjustments to our expected obsolescence reserve related to the Plan in the prior year.
BSG. BSG’s gross profit was flat for the six months ended March 31, 2024, as a result of a lower gross margin on units sold, offset by an increase in net sales. BSG’s gross margin decline was driven by unfavorable fixed cost absorption, shrink expense, and adjustments to our expected obsolescence reserve related to the Plan in the prior year, partially offset by lower distribution and freight costs from supply chain efficiencies and higher product margins primarily from higher take rate on promotions and brand mix.
SBS. SBS’s selling, general and administrative expenses increased $10.4 million, or 2.3%, for the six months ended March 31, 2024, and included an unfavorable impact from foreign exchange rates of $5.1 million and cost savings from store closures in connection with the Plan. As a percentage of SBS net sales, selling, general and administrative expense for the six months ended March 31, 2024, was 44.4% compared to 41.6% for the six months ended March 31, 2023. The increase as a percentage of sales was due to higher labor costs, rent costs, and advertising expenses.
BSG. BSG’s selling, general and administrative expenses decreased $0.9 million, or 0.4%, for the six months ended March 31, 2024. As a percentage of BSG net sales, selling, general and administrative expense for the six months ended March 31, 2024, was 28.4% compared to 28.8% for the six months ended March 31, 2023. The decrease as a percentage of sales was driven primarily by lower delivery expense.
Unallocated. Unallocated selling, general and administrative expenses, which represent certain corporate costs that have not been charged to our reporting segments, increased $10.9 million, or 10.6%, for the six months ended March 31, 2024, primarily due to expenses in connection with our Fuel for Growth initiative in the current year, partially offset by lower accrued bonus expense.
20
The decrease in restructuring was primarily due to the lapping of expenses incurred in connection with our Distribution Center Consolidation and Store Optimization Plan in the prior year for $17.7 million. See Note 12, Restructuring, in Item 1 of this quarterly report for more information on the Plan.
The increase in interest expense is primarily due to higher interest rates on our variable rate debt and an increase in our losses on debt extinguishment, partially offset by lower average outstanding borrowings on our ABL facility during the current year. See Note 9, Short-term and Long-term Debt, and Note 10, Derivative Instruments and Hedging Activities, in Item 1 of this quarterly report for more information on our debt and interest rate swap that has helped mitigate some of the additional interest costs resulting from higher interest rates.
Liquidity and Capital Resources
Our principal sources of liquidity are cash from operations, cash and cash equivalents and borrowings under our ABL facility. A substantial portion of our liquidity needs arise from funding the costs of our operations, working capital, capital expenditures, debt interest and principal payments. Additionally, under our share repurchase program (see below for more details) we will from time-to-time repurchase shares of our common stock on the open market to return value to our shareholders. At March 31, 2024, we had $517.8 million in our liquidity pool, which includes $420.6 million available for borrowing under our ABL facility and cash and cash equivalents of $97.2 million.
Our working capital (current assets less current liabilities) decreased $12.1 million, to $636.6 million at March 31, 2024, compared to $648.7 million at September 30, 2023. The decrease was primarily driven by the impacts of our debt activity during the quarter, resulting in higher borrowings under our ABL facility and a decrease in cash and cash equivalents, and due to the timing of AP payments. These impacts were partially offset by an increase in inventory, as a result of expanded distribution rights in BSG, vendor price increases, the impact of foreign exchange rates of $4.7 million, and by fewer accrued liabilities, driven by the timing of interest and payroll payments.
We anticipate that existing cash balances (excluding certain amounts permanently invested in connection with foreign operations), cash expected to be generated by operations, and funds available under our ABL facility will be sufficient to fund our working capital and capital expenditure requirements over the next twelve months.
Cash Flows
Net Cash Provided by Operating Activities
The increase in cash provided by operating activities was driven by the timing of account payables payments and inventory purchases and lease contract termination and severance payments in connection with the Plan in the prior year, partially offset by the timing of cash receipts from customers.
Net Cash Used by Investing Activities
The increase in cash used by investing activities was driven by higher capital expenditures related to store improvements.
Net Cash Used by Financing Activities
The increase in cash used by financing activities was primarily due to shares repurchased in the current year under our share repurchases program, partially offset by fewer reductions in our debt outstanding in the current year compared to the prior year.
Debt and Guarantor Financial Information
During the three months ending March 31, 2024, we issued $600.0 million in 2032 Senior Notes and used the proceeds, together with cash on hand and borrowings under our ABL facility, to repay in full our 2025 Senior Notes. See Note 9, Short-term and Long-term Debt, in Item 1 of this quarterly report for more information on the issuance and repayment of debt.
21
At March 31, 2024, we had $1.1 billion in outstanding debt principal, excluding finance lease obligations, unamortized debt issuance costs and debt discounts, in the aggregate, of $13.7 million. Our debt consists of $600.0 million in 2032 Senior Notes outstanding, $396.0 million remaining on our term loan and $62.0 million in outstanding borrowings under our ABL facility.
We utilize our ABL facility for the issuance of letters of credit, certain working capital and liquidity needs, and to manage normal fluctuations in our operational cash flow. In that regard, we may from time to time draw funds under the ABL facility for general corporate purposes including funding of capital expenditures, acquisitions, paying down other debt and share repurchases. Amounts drawn on our ABL facility are generally paid down with cash provided by our operating activities. During the six months ended March 31, 2024, the weighted average interest rate on our borrowings under the ABL facility was 7.73%.
We are currently in compliance with the agreements and instruments governing our debt, including our financial covenants.
Guarantor Financial Information
Our 2032 Senior Notes were issued by our wholly-owned subsidiaries, Sally Holdings LLC and Sally Capital Inc. (the “Issuers”). The notes are unsecured debt instruments guaranteed by us and certain of our wholly-owned domestic subsidiaries (together, the “Guarantors”) and have certain restrictions on the ability of our subsidiaries to make certain restrictive payments to Sally Beauty. The guarantees are joint and several, and full and unconditional. Certain other subsidiaries, including our foreign subsidiaries, do not serve as guarantors.
The following summarized consolidating financial information represents financial information for the Issuers and the Guarantors on a combined basis. All transactions and intercompany balances between these combined entities has been eliminated.
The following table presents the summarized balance sheets information for the Issuers and the Guarantors as of March 31, 2024, and September 30, 2023:
32,784
66,148
787,351
735,853
Intercompany receivable
1,658
Current assets
915,327
890,462
2,073,759
2,076,413
Current liabilities
524,496
468,202
Intercompany payable
2,611
1,984,754
2,011,075
The following table presents the summarized statement of earnings information for the Issuers and the Guarantors for six months ended March 31, 2024 (in thousands):
1,479,062
757,827
72,048
Net Earnings
54,377
Share Repurchase Programs
Under our current share repurchase program, we may from time-to-time repurchase our common stock on the open market. During the three and six months ended March 31, 2024, we repurchased 1.5 million and 3.5 million shares of our common stock for $20.0 million and $40.0 million, respectively, under our share repurchase program, excluding the impact of excise taxes. During the three and six months ended March 31, 2023, no shares were repurchased in connection with our share repurchase program. See Note 5, Stockholders’ Equity, for more information about our share repurchase program.
Contractual Obligations
Other than our debt, as discussed above, there have been no material changes outside the ordinary course of our business to our contractual obligations since September 30, 2023.
Off-Balance Sheet Financing Arrangements
At March 31, 2024, and September 30, 2023, we had no off-balance sheet financing arrangements other than outstanding letters of credit related to inventory purchases and self-insurance programs.
Critical Accounting Estimates
There have been no material changes to our critical accounting estimates or assumptions since September 30, 2023.
Recent Accounting Pronouncements
See Note 2 of the Notes to Condensed Consolidated Financial Statements in Item 1 – “Financial Statements” in Part I – Financial Information.
23
As a multinational corporation, we are subject to certain market risks including foreign currency fluctuations, interest rates and government actions. There have been no material changes to our market risks from September 30, 2023. See our disclosures about market risks contained in Item 7A. “Quantitative and Qualitative Disclosures about Market Risk” in Part II of our Annual Report on Form 10-K for the fiscal year ended September 30, 2023.
Controls Evaluation and Related CEO and CFO Certifications. Our management, with the participation of our principal executive officer (“CEO”) and principal financial officer (“CFO”), conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of March 31, 2024. The controls evaluation was conducted by our Disclosure Committee, comprised of senior representatives from our finance, accounting, internal audit, and legal departments under the supervision of our CEO and CFO.
Certifications of our CEO and our CFO, which are required in accordance with Rule 13a-14 of the Exchange Act, are attached as exhibits to this Quarterly Report. This “Controls and Procedures” section includes the information concerning the controls evaluation referred to in the certifications, and it should be read in conjunction with the certifications for a more complete understanding of the topics presented.
Limitations on the Effectiveness of Controls. We do not expect that our disclosure controls and procedures will prevent all errors and all fraud. A system of controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the system are met. Because of the limitations in all such systems, no evaluation can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. Furthermore, the design of any system of controls and procedures is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how unlikely. Because of these inherent limitations in a cost-effective system of controls and procedures, misstatements or omissions due to error or fraud may occur and not be detected.
Scope of the Controls Evaluation. The evaluation of our disclosure controls and procedures included a review of their objectives and design, our implementation of the controls and procedures and the effect of the controls and procedures on the information generated for use in this Quarterly Report. In the course of the evaluation, we sought to identify whether we had any data errors, control problems or acts of fraud and to confirm that appropriate corrective action, including process improvements, was being undertaken if needed. This type of evaluation is performed on a quarterly basis so that conclusions concerning the effectiveness of our disclosure controls and procedures can be reported in our Quarterly Reports on Form 10-Q and our Annual Reports on Form 10-K. Many of the components of our disclosure controls and procedures are also evaluated by our internal audit department, by our legal department and by personnel in our finance organization. The overall goals of these various evaluation activities are to monitor our disclosure controls and procedures on an ongoing basis and to maintain them as dynamic systems that change as conditions warrant.
Conclusions regarding Disclosure Controls. Based on the required evaluation of our disclosure controls and procedures, our CEO and CFO have concluded that, as of March 31, 2024, we maintain disclosure controls and procedures that are effective in providing reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting. During our most recent fiscal quarter, there have been no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
We are involved, from time to time, in various claims and lawsuits incidental to the conduct of our business in the ordinary course. We carry insurance coverage in such amounts in excess of our self-insured retention as we believe to be reasonable under the circumstances and that may or may not cover any or all of our liabilities in respect of these matters. We do not believe that the ultimate resolution of these matters will have a material adverse impact on our consolidated financial position, cash flows or results of operations.
We are subject to a number of U.S., federal, state and local laws and regulations, as well as the laws and regulations applicable in each foreign country or jurisdiction in which we do business. These laws and regulations govern, among other things, the composition, packaging, labeling and safety of the products we sell, the methods we use to sell these products and the methods we use to import these products. We believe that we are in material compliance with such laws and regulations, although no assurance can be provided that this will remain true going forward.
In addition to the other information set forth in this Quarterly Report, you should carefully consider the factors contained in Item 1A. “Risk Factors” in Part I of our Annual Report on Form 10-K for the fiscal year ended September 30, 2023, which could materially affect our business, financial condition or future results. There have been no material changes from the risk factors disclosed in such Annual Report. The risks described in such Annual Report and herein are not the only risks facing our company.
Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities
Information regarding shares of common stock we repurchased during the second quarter of fiscal year 2024, excluding the impact of excise taxes, is as follows:
Fiscal Period
Total Number of Shares Purchased (1)
Average Price Paid per Share
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1)(2)
Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
Jan 1 -Jan 31, 2024
560,792,432
Feb 1 - Feb 29, 2024
1,209,241
13.22
544,801,708
Mar 1 - Mar 31, 2024
317,227
12.64
540,792,435
Total this quarter
1,526,468
13.10
During the quarter ended March 31, 2024, no director or officer of the Company adopted, modified, or terminated any Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement, as such terms are defined in Item 408(a) of Regulation S-K.
Exhibit No.
Description
3.1
Third Restated Certificate of Incorporation of Sally Beauty Holdings, Inc., dated January 30, 2014, which is incorporated herein by reference from Exhibit 3.3 to the Company’s Current Report on Form 8-K filed on January 30, 2014
3.2
Amended and Restated Bylaws of Sally Beauty Holdings, Inc., dated April 26, 2017, which is incorporated herein by reference from Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on April 28, 2017
Fifth Supplemental Indenture, dated as of February 27, 2024, by and among Sally Holdings LLC, Sally Capital Inc., the guarantors listed therein and Computershare Trust Company, N.A, which is incorporated herein by reference from Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on February 27, 2024
List of Subsidiary Guarantors*
31.1
Rule 13a-14(a)/15d-14(a) Certification of Denise Paulonis*
31.2
Rule 13a-14(a)/15d-14(a) Certification of Marlo M. Cormier*
32.1
Section 1350 Certification of Denise Paulonis*
32.2
Section 1350 Certification of Marlo M. Cormier*
101
The following financial information from our Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2024, formatted in iXBRL (Inline Extensible Business Reporting Language): (i) the Condensed Consolidated Balance Sheets; (ii) the Condensed Consolidated Statements of Earnings; (iii) the Condensed Consolidated Statements of Comprehensive Income; (iv) the Condensed Consolidated Statements of Stockholders’ Equity; (v) the Condensed Consolidated Statements of Cash Flows; and (vi) the Notes to Condensed Consolidated Financial Statements.
104
The cover page from our Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2024, formatted in iXBRL (contained in Exhibit 101).
* Included herewith
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
(Registrant)
Date: May 9, 2024
By:
/s/ Marlo M. Cormier
Marlo M. Cormier
Senior Vice President, Chief Financial Officer
For the Registrant and as its Principal Financial Officer
27