Sally Beauty Holdings, Inc. reported its financial results for the second quarter of fiscal 2025, revealing a decrease in consolidated net sales to $883.1 million, down 2.8% from $908.4 million in the same period last year. The decline was attributed to a negative impact of $9.7 million from foreign currency exchange rates and a 1.3% decrease in comparable sales. Despite the drop in sales, the company experienced an increase in net earnings, which rose 34.1% to $39.2 million, compared to $29.2 million in the prior year. This resulted in a diluted earnings per share of $0.38, up from $0.27.
In terms of operational performance, Sally Beauty's gross profit for the quarter was $458.8 million, a slight decrease of 0.9% from $463.1 million a year earlier. However, the gross margin improved by 100 basis points to 52.0%, driven by lower distribution and freight costs, as well as enhanced promotional strategies. The company reported operating earnings of $69.4 million, an increase of 16.4% from $59.6 million in the previous year, reflecting a 130 basis point improvement in operating margin to 7.9%.
Sally Beauty's strategic initiatives included the sale of its corporate headquarters in Denton, Texas, for $45.5 million, which contributed to a gain of approximately $26.6 million recognized in the financial statements. The company also continued its share repurchase program, buying back 1.1 million shares for $10 million during the quarter. As of March 31, 2025, the company had approximately $500.8 million remaining under its share repurchase authorization.
The company reported a total of 4,446 stores at the end of the quarter, a decrease of 22 locations compared to the previous year. The decline in store count was attributed to strategic decisions regarding store performance and market conditions. Sally Beauty's liquidity position remained strong, with $574.9 million available, including $482.7 million under its asset-based lending facility and $92.2 million in cash and cash equivalents.
Looking ahead, Sally Beauty anticipates that its existing cash balances and cash generated from operations will be sufficient to meet its working capital and capital expenditure needs over the next twelve months. The company remains focused on enhancing its product offerings and improving operational efficiencies to navigate the challenges posed by market conditions and consumer behavior.
About Sally Beauty Holdings, Inc.
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