Sally Beauty Holdings Inc. (NYSE:SBH) shares rose more than 2% in premarket trading on Monday after the beauty products retailer reported second-quarter results that exceeded analyst expectations.
The company also narrowed its full-year guidance range following the quarterly performance
Earnings and Revenue Top Estimates For the quarter ended March 31, Sally Beauty posted adjusted earnings per share of $0.44, ahead of analyst expectations of $0.41 per share. Revenue totaled $903 million, slightly above the consensus forecast of $900.43 million and up 2.3% from $883 million in the same period last year. Comparable consolidated sales increased 1.3% during the quarter. “Our second quarter results reflect solid execution and the resilience of our operating model amid a dynamic macroeconomic environment,” said President and Chief Executive Officer Denise Paulonis. “We delivered low-single digit sales growth, gross margin expansion, and strong cash flow from operations, driven by the compounding benefits of our growth initiatives.” Cash Flow Supports Debt Reduction and Share Buybacks The company generated $73 million in operating cash flow during the quarter.
Sally Beauty used the funds to reduce debt, repurchase shares and continue investing in growth initiatives. During the period, the company bought back 1.7 million shares for $25 million and repaid $20 million of term loan debt. At quarter-end, Sally Beauty reported a net debt leverage ratio of 1.5x and said it had no outstanding borrowings under its revolving credit facility.