None of the Company's salon leases are individually material to the operations of the Company, and the Company expects that it will be able to renew its leases on satisfactory terms as they expire. Legal Proceedings. The Company is a defendant in various lawsuits and claims arising out of the normal course of business. Like certain other large retail employers, the Company has been faced with allegations of purported class-wide consumer and wage and hour violations. In addition, the Company is a nominal defendant, and nine current and former directors and officers of the Company are named defendants, in a shareholder derivative action in Minnesota state court.
The derivative shareholder alleges that the individual defendants breached their fiduciary duties to the Company in connection with their approval of certain executive compensation arrangements and certain related party transactions. A Special Litigation Committee has been formed per the direction of the judge in the matter. The Company is working with outside counsel to formulate its next steps in keeping with the court. Litigation is inherently unpredictable and the outcome of these matters cannot presently be determined. Although the actions are being vigorously defended, the Company could in the future incur judgments or enter into settlements of claims that could have a material adverse effect on its results of operations in any particular period.
Mine Safety Disclosures. The quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission, and may not necessarily represent actual transactions. The Company expects to continue paying regular quarterly dividends in the foreseeable future. Notwithstanding anything to the contrary set forth in any of our previous filings under the Securities Act of or the Securities Exchange Act of that might incorporate future filings or this Annual Report, the following performance graph and accompanying data shall not be deemed to be incorporated by reference into any such filings.
In addition, they shall not be deemed to be "soliciting material" or "filed" with the SEC. The Peer Group is a self-constructed peer group of companies that have comparable annual revenues, the guest service element is a critical component to the business, and a target of moderate guests in terms of income and style, excluding apparel companies. The timing and amounts of any repurchases will depend on many factors, including the market price of the common stock and overall. Historically, the repurchases to date have been made primarily to eliminate the dilutive effect of shares issued in conjunction with acquisitions, restricted stock grants and stock option exercises.
All repurchased shares become authorized but unissued shares of the Company. This repurchase program has no stated expiration date. Selected Financial Data. All periods presented will reflect Trade Secret as a discontinued operation. The following discussion of results of operations will reflect results from continuing operations. Discontinued operations will be discussed at the end of this section. Company's Regis salon concept was recorded in fiscal year Regis Corporation RGS owns or franchises beauty salons and hair restoration centers.
Our salon concepts offer generally similar products and services and serve mass market consumers. Our salon operations are organized to be managed based on geographical location. During fiscal year , we had approximately 52, corporate employees worldwide. Our fiscal year growth strategy is focused on improving the guest experience. We plan to execute our strategy by putting guests and stylists first, leveraging the power of our salon brands, focusing on technology and connectivity, and reviewing our non-core assets.
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Initiatives include:. The strength of our salon business is in the fundamental similarity and broad appeal of our salon concepts. Each concept generally targets the middle market guest, however, each attracts a different demographic. We execute our salon growth strategy by focusing on real estate. Our salon real estate strategy is to add new units in convenient locations with good visibility and guest traffic, as well as appropriate trade demographics.
Our various salon and product concepts operate in a wide range of retailing environments, including regional shopping malls, strip centers and Walmart Supercenters. We believe that the availability of real estate will augment our ability to achieve the aforementioned long-term growth objectives.
Organic salon revenue is achieved through the combination of new salon construction and salon same-store sales results. Older, unprofitable salons will be closed or relocated. Although we have generally been experiencing negative same-store sales we believe our strategy of focusing on the in-salon guest experience will improve same-store sales. Historically, our salon acquisitions have varied in size from as small as one salon to over one thousand salons.
The median acquisition size is approximately ten salons. This industry is comprised of numerous locations domestically and is highly fragmented.
In an effort to provide confidentiality for guests, the hair restoration centers operate primarily in professional or medical office buildings. Further, the hair restoration business is more marketing intensive. As a result, organic growth at hair restoration centers is dependant on successfully generating new leads and converting them into hair restoration guests. The Consolidated Financial Statements are prepared in conformity with accounting principles generally accepted in the United States of America. In preparing the Consolidated Financial Statements, we are required to make various judgments, estimates and assumptions that could have a significant impact on the results reported in the Consolidated Financial Statements.
We base these estimates on historical experience and other assumptions believed to be reasonable under the circumstances. Changes in these estimates could have a material effect on our Consolidated Financial Statements. We believe the following accounting policies are most critical to aid in fully understanding and evaluating our reported financial condition and results of operations. The Company has equity investments in securities of certain privately held entities.
The Company accounts for these investments under the equity method of accounting. The Company also has loan receivables from certain of these entities. Investments accounted for under the equity method are recorded at the amount of the Company's investment and adjusted each period for the Company's share of the investee's income or loss. Investments are reviewed for changes in circumstance or the occurrence of events that suggest the Company's investment may not be recoverable.
The note receivable balances within the Company's Consolidated Balance Sheet primarily include note receivables related to the Company's investments in EEG and MY Style, a note receivable with the purchaser of Trade Secret and note receivables with our franchisees. The balances are presented net of a valuation reserve for estimated losses. The Company monitors the financial condition of its counterparties with an outstanding note receivable and records provisions for estimated losses on receivables when it believes the counterparties are unable to make their required payments.
The valuation reserve is the Company's best estimate of the amount of probable credit losses related to existing notes receivable. During the third quarter of fiscal year , the Company did not receive a scheduled interest payment related to the outstanding note receivable with the purchaser of Trade Secret, the fair value of the collateral decreased to a level below the carrying value of the outstanding note receivable, and the purchaser of Trade Secret provided the Company with a new five year business plan that was well below their original projections.
Due to these factors that occurred during the third quarter of fiscal year , the Company evaluated the note receivable for impairment based on a probability weighted expected future cash flow analysis. During the fourth quarter of fiscal year , the Company did not receive a scheduled interest payment related to the outstanding note receivable with the purchaser of Trade Secret and the fair value of the collateral continued to decrease and was at a level significantly below the carrying value of the outstanding note receivable.
In addition, the Company received updated financial projections that were below the projections received during the third quarter of fiscal year Goodwill is tested for impairment annually or at the time of a triggering event. In evaluating whether goodwill is impaired, the Company compares the carrying value of each reporting unit, including goodwill, to the estimated fair value of the reporting unit.
The carrying value of each reporting unit is based on the assets and liabilities associated with the operations of the reporting unit,. Allocations are generally based on the number of salons in each reporting unit as a percent of total company-owned salons. The Company calculates the estimated fair value of the reporting units based on discounted future cash flows that utilize estimates in annual revenue, gross margins, fixed expense rates, allocated corporate overhead, and long-term growth rates for determining terminal value. The Company's estimated future cash flows also take into consideration acquisition integration and maturation.
Where available and as appropriate, comparative market multiples are used in conjunction with the results of the discounted cash flows. The Company considers its various concepts to be reporting units when testing for goodwill impairment because that is where the goodwill resides. The Company periodically engages third-party valuation consultants to assist in evaluation of the Company's estimated fair value calculations. In the situations where a reporting unit's carrying value exceeds its estimated fair value, the amount of the impairment loss must be measured.
The measurement of impairment is calculated by determining the implied fair value of a reporting unit's goodwill. In calculating the implied fair value of goodwill, the fair value of the reporting unit is allocated to all other assets and liabilities of that unit based on the relative fair values under the assumption of a taxable transaction.
The excess of the fair value of the reporting unit over the amount assigned to its assets and liabilities is the implied fair value of goodwill. The goodwill impairment is measured as the excess of the carrying value of goodwill over its implied fair value. As previously disclosed, the Company concluded that it was reasonably likely that goodwill for the Regis and Hair Restoration Centers reporting units might become impaired in future periods.
The Regis salon concept reported same-store sales of negative 4. Visitation patterns did not rebound as quickly as the Company originally projected. Accordingly, the Company reduced the budgeted financial projections for future years. A summary of the critical assumptions utilized during the fiscal year annual impairment test of the Regis salon concept are outlined below:.
Annual revenue growth. Annual revenue growth is primarily driven by assumed same-store sales rates of approximately negative 2. Other considerations include anticipated economic conditions and moderate acquisition growth. Gross margin. Adjusted for anticipated salon closures, new salon construction and acquisitions estimated future gross margins were held constant. Fixed expense rates.
Fixed expense rate increases of approximately 1. Fixed expenses consisted of rent, site operating, and allocated general and administrative corporate overhead. Allocated corporate overhead. Corporate overhead incurred by the home office based on the number of Regis salons as a percent of total company-owned salons.
Long-term growth. A long-term growth rate of 2. Discount rate. A discount rate of The following table summarizes the approximate impact that a change in certain critical assumptions would have on the estimated fair value of our Regis salon concept reporting unit the approximate impact of the change in the critical assumptions assumes all other assumptions and factors remain constant :.
As previously disclosed, the Company has agreed to sell the Hair Restoration Centers reporting unit in the first half of fiscal year ; however, until this reporting unit is sold it is reasonably likely that there could be impairment of the Hair Restoration Centers reporting unit's goodwill in future periods.
The sensitivity of the Company's critical assumptions in estimating fair value of this reporting unit, the Company has provided additional information related to this reporting unit. A summary of the critical assumptions utilized during the fiscal year interim impairment test of the Hair Restoration Centers reporting unit are outlined below:.
Annual revenue growth is primarily driven by assumed same-store sales rates of approximately positive 1. Adjusted for anticipated center closures, new center construction and acquisitions. In addition, estimated future gross margins were adjusted for increasing supply costs. Corporate overhead incurred by the home office is not allocated as the Hair Restoration Centers reporting unit incurs its own overhead. A nontaxable structure based on the highest economic value and feasibility of the assumed structure.
The following table summarizes the approximate impact that a change in certain critical assumptions would have on the estimated fair value of our Hair Restoration Centers reporting unit goodwill balance the approximate impact of the change in the critical assumptions assumes all other assumptions and factors remain constant :. As it is reasonably likely that there could be impairment of the Promenade salon concept's goodwill in future periods along with the sensitivity of the Company's critical assumptions in estimating fair value of this reporting unit, the Company has provided additional information related to this reporting unit.
A summary of the critical assumptions utilized during the fiscal year annual impairment test of the Promenade salon concept are outlined below:. Corporate overhead incurred by the home office based on the number of Promenade company-owned salons as a percent of total company-owned salons. A long-term growth rate of 3. The following table summarizes the approximate impact that a change in certain critical assumptions would have on the estimated fair value of our Promenade salon concept goodwill balance the approximate impact of the change in the critical assumptions assumes all other assumptions and factors remain constant :.
While the Company has determined the estimated fair values of Promenade to be appropriate based on the historical level of revenue growth, operating income and cash flows, it is reasonably likely that Promenade may experience additional impairment in future periods. As previously disclosed, the Company has agreed to sell the Hair Restoration Centers reporting unit in the first half of fiscal year ; however, until this reporting unit is sold it is reasonably likely there could be impairment of the Hair Restoration Centers reporting unit's goodwill in future periods.
The term "reasonably likely" refers to an occurrence that is more than remote but less than probable in the judgment of the Company. Because some of the inherent assumptions and estimates used in determining the fair value of the reportable segment are outside the control of management, changes in these underlying assumptions can adversely impact fair value. Potential impairment of a portion or all of the carrying value of goodwill for the Promenade salon concept and Hair Restoration Centers reporting units is dependent on many factors and cannot be predicted with certainty.
We assess the impairment of long-lived assets annually or when events or changes in circumstances indicate that the carrying value of the assets or the asset grouping may not be recoverable. Our impairment analysis on salon property and equipment is performed on a salon by salon basis. The Company's test for impairment is performed at a salon level as this is the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities. Factors considered in deciding when to perform an impairment review include significant under-performance of an individual salon in relation to expectations, significant economic or geographic trends, and significant changes or planned changes in our use of the assets.
Impairment is evaluated based on the sum of undiscounted estimated future cash flows expected to result from use of the related salon assets that does not recover the carrying value of the salon assets. When the sum of a salon's undiscounted estimated future cash flow is zero or negative, impairment is measured as the full carrying value of the related salon's equipment and leasehold improvements. When the sum of a salon's undiscounted cash flows is greater than zero but less than the carrying value of the related salon's equipment and leasehold improvements, a discounted cash flow analysis is performed to estimate the fair value of the salon assets and impairment is measured as the difference between the carrying value of the salon assets and the estimated fair value.
The fair value estimate is based on the best information available, including market data.
Judgments made by management related to the expected useful lives of long-lived assets and the ability to realize undiscounted cash flows in excess of the carrying amounts of such assets are affected by factors such as the ongoing maintenance and improvement of the assets, changes in economic conditions and changes in operating performance. As the ongoing expected cash flows and carrying amounts of long-lived assets are assessed, these factors could cause us to realize material impairment charges.
The acquisition purchase prices are allocated to assets acquired, including identifiable intangible assets, and liabilities assumed based on their estimated fair values at the dates of acquisition. Fair value is estimated based on the amount for which the asset or liability could be bought or sold in a current transaction between willing parties. For our acquisitions, the majority of the purchase price that is not allocated to identifiable assets, or liabilities assumed, is accounted for as residual goodwill rather than identifiable intangible assets.
This stems from the value associated with the walk-in guest base of the acquired salons, the value of which is not recorded as an identifiable intangible asset under current accounting guidance and the limited value of the acquired leased site and guest preference associated with the acquired hair salon brand. Residual goodwill further represents our opportunity to strategically combine the acquired business with our existing structure to serve a greater number of guests through our expansion strategies.
The Company uses a combination of third party insurance and self-insurance for a number of risks including workers' compensation, health insurance, employment practice liability and general liability claims. The liability represents the Company's estimate of the undiscounted ultimate cost of uninsured claims incurred as of the balance sheet date.
The workers' compensation, general liability and employment practice liability analysis includes applying loss development factors to the Company's historical claims data total paid and incurred amounts per claim for all policy years where the Company has not reached its aggregate limits to project the future development of incurred claims.
The workers' compensation analysis is performed for three models; California, Texas and all other states. A variety of accepted actuarial methodologies are followed to determine these liabilities, including several methods to predict the loss development factors for each policy period. These liabilities are determined by modeling the frequency number of claims and severity cost of claims , fitting statistical distributions to the experience, and then running simulations.
A similar analysis is performed for both general liability and employment practices liability; however, it is a single model for all liability claims rather than the three separate models used for workers' compensation. The lag factors are developed based on the Company's specific claim data utilizing a completion factor methodology.
The developed factor, expressed as a percentage of paid claims, is applied to the trailing twelve months of paid claims to calculate the estimated liability amount. The calculated liability amount is reviewed for reasonableness based on reserve adequacy ranges for historical periods by testing prior reserve levels against actual expenses to date. Although the Company does not expect the amounts ultimately paid to differ significantly from the estimates, self-insurance accruals could be affected if future claims experience differs significantly from the historical trends and actuarial assumptions.
The Company updates loss projections twice each year and adjusts its recorded liability to reflect the current projections. The updated loss projections consider new claims and developments associated with existing claims for each open policy period. As certain claims can take years to settle, the Company has multiple policy periods open at any point in time. In determining income for financial statement purposes, management must make certain estimates and judgments. These estimates and judgments occur in the calculation of certain tax liabilities and in the determination of the recoverability of certain deferred tax assets which arise from temporary differences between the tax and financial statement recognition of revenue and expense.
Management must assess the likelihood that deferred tax assets will be recovered. If recovery is not likely, we must increase our provision for taxes by recording a reserve, in the form of a valuation allowance, for the deferred tax assets that will not ultimately be recoverable. Should there be a change in our ability to recover our deferred tax assets, our tax provision would increase in the period in which it is determined that the recovery is not likely.
In addition, the calculation of tax liabilities involves dealing with uncertainties in the application of complex tax regulations. Management recognizes a reserve for potential liabilities for anticipated tax audit issues in the United States and other tax jurisdictions based on our estimate of whether additional taxes will be due.
If payment of these amounts ultimately proves to be unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period when we determine the liabilities are no longer necessary. If our estimate of tax liabilities proves to be less than the ultimate assessment, a further charge to expense would result.
In the United States, fiscal years For state tax audits, the statute of limitations generally spans three to four years, resulting in a number of states remaining open for tax audits dating back to fiscal year However, the Company is under audit in a number of states in which the statute of limitations has been extended for fiscal years and forward. Internationally, including Canada, the statute of limitations for tax audits varies by jurisdiction, but generally ranges from three to five years. We are involved in various lawsuits and claims that arise from time to time in the ordinary course of our business.
Accruals are recorded for such contingencies based on our assessment that the occurrence is probable, and where determinable, an estimate of the liability amount. Management considers many factors in making these assessments including past history and the specifics of each case.
However, litigation is inherently unpredictable and excessive verdicts do occur, which could have a material impact on our Consolidated Financial Statements. The following summarizes key aspects of our fiscal year results:. Consolidated Results of Operations. The percentages are computed as a percent of total revenues, except as noted. Results of Operations as a Percent of Revenues. Consolidated Revenues. Consolidated revenues primarily include revenues of company-owned salons, product and equipment sales to franchisees, hair restoration center revenues, and franchise royalties and fees.
As compared to the prior fiscal year, consolidated revenues decreased 2. The following table details our consolidated revenues by concept. All service revenues, product revenues which include product and equipment sales to. Quarterly and year-to-date same-store sales are the sum of the same-store sales computed on a daily basis.
Locations relocated within a one mile radius are included in same-store sales as they are considered to have been open in the prior period. International same-store sales are calculated in local currencies to remove foreign currency fluctuations from the calculation. The agreement included a provision that the Company would supply product to the purchaser of Trade Secret and provide certain administrative services for a transition period. The decreases of 2. The same-store sales decrease of 3. The Company constructed company-owned salons and six hair restoration centers.
The same-store sales decrease of 1. During fiscal year , there was no foreign currency impact on revenues as the weakening of the United States dollar against the Canadian dollar was offset by the strengthening of the United Stated dollar against the British pound and Euro as compared to the prior fiscal year's exchange rates.
During fiscal year , the foreign currency impact was driven by the weakening of the United States dollar against the Canadian dollar and British pound, as compared to the prior fiscal year's exchange rates. During fiscal year , the foreign currency impact was driven by the weakening of the United States dollar against the Canadian dollar, partially offset by the strengthening of the United Stated dollar against the British pound and Euro as compared to the prior fiscal year's exchange rates.
Consolidated revenues are primarily composed of service and product revenues, as well as franchise royalties and fees. Fluctuations in these three major revenue categories were as follows:. Service Revenues. Service revenues include revenues generated from company-owned salons and service revenues generated by hair restoration centers. Consolidated service revenues were as follows:.
The decrease in same-store services sales was primarily a result of a decline in same-store guest visits and a decline in average ticket due to promotional programs designed to generate additional guest visits in the salons with the promotional programs. The decrease in service revenues during fiscal year was due to same-store service sales decreasing 2. The decrease in service revenues during fiscal year was due to same-store service sales decreasing 3.
In addition, service revenues decreased due to the strengthening of the United States dollar against the British pound. Product Revenues. Product revenues are primarily sales at company-owned salons and hair restoration centers, and sales of product and equipment to franchisees. Consolidated product revenues were as follows:. Partially offsetting the decrease was same-store product sales increasing 0.
Royalties and Fees. Consolidated franchise revenues, which include royalties and franchise fees, were as follows:. During fiscal year , we purchased a The increase in royalties and fees was also due to same-store sales increases at franchise locations. Our cost of revenues primarily includes labor costs related to salon employees and hair restoration center employees, the cost of product used in providing services and the cost of products sold to guests and franchisees.
The resulting gross margin was as follows:. Service Margin Excluding Depreciation. Service margin was as follows:. Service margin as a percent of service revenues during fiscal year was consistent with fiscal year Lower commissions as a result of leveraged pay plans for new stylists and a decrease in salon health insurance costs due to lower claims were offset by decreased productivity in our North American segment and an increase in the cost of labor within our Hair Restoration Centers segment. The basis point decrease in service margins as a percent of service revenues during fiscal year was primarily due to an unexpected increase in salon health insurance costs due to several unusually large claims and an increase in payroll taxes as a result of states increasing unemployment taxes.
The basis point improvement in service margins as a percent of service revenues during fiscal year was primarily due to the benefit of the new leveraged salon pay plans implemented in the calendar year. Increases in salon health insurance and payroll taxes partially offset the basis point improvement. Product Margin Excluding Depreciation. Product margin was as follows:. The agreement included a provision that Regis Corporation would supply product to the purchaser at cost for a transition period.
The following tables breakout product revenues, cost of product and product margin as a percent of product revenues between product and product sold to the purchaser of Trade Secret.
Partially offsetting the basis point decrease was a reduction in commissions paid to new employees on retail product sales in our North American segment. The basis point decrease in product margin other than sold to purchaser of Trade Secret as a percentage of product revenues during fiscal year was primarily due to an increase in sales of slightly lower-profit margin appliances in our International segment and an increase in the cost of hair systems in our Hair Restoration Centers segment, partially offset by reduced commissions paid to new employees on retail product sales in our North American segment.
The basis point improvement in product margin other than sold to purchaser of Trade Secret as a percentage of product revenues during fiscal year was due to a planned reduction in retail commissions paid to new employees on retail product sales. This expense category includes direct costs incurred by our salons and hair restoration centers, such as on-site advertising, workers' compensation, insurance, utilities and janitorial costs.
Site operating expenses were as follows:. The basis point increase in site operating expenses as a percent of consolidated revenues during fiscal year was primarily due to negative leverage from the decrease in same-store sales. Site operating expenses as a percent of consolidated revenues during fiscal year was consistent with fiscal year A reduction in legal claims expense and a favorable sales tax audit adjustment were offset by a planned increase in advertising expense within the Company's Promenade concept and an increase in self-insurance accruals.
The basis point increase in site operating expenses as a percent of consolidated revenues during fiscal year was primarily due to higher self-insurance expense. Also contributing to the improvement during fiscal year was a reduction in salaries and other employee benefits as a result of the reduction in home office workforce that occurred in January Partially offsetting the basis point improvement were incremental costs associated with the Company's senior management restructuring, severance charges, and professional fees incurred in connection with the contested proxy and the exploration of alternatives for non-core assets.
Rent expense, which includes base and percentage rent, common area maintenance and real estate taxes, was as follows:. The basis point increase in rent expense as a percent of consolidated revenues during fiscal year was primarily due to negative leverage in this fixed cost category due to negative same-store sales, partially offset by favorable common area maintenance adjustments from landlords and salon closures.
The basis point increase in rent expense as a percent of consolidated revenues during fiscal year was primarily due to negative leverage in this fixed cost category due to negative same-store sales, partially offset by a favorable reduction to our common area maintenance expenses. The basis point increase in rent expense as a percent of consolidated revenues during fiscal year was primarily due to negative leverage in this fixed cost category, partially offset by a reduction in our percentage rent payments, both due to negative same-store sales.
Partially offsetting the basis point increase was the continuation of a decrease in depreciation expense from the reduction in salon construction beginning in fiscal year as compared to historical levels prior to fiscal year The basis point decrease was partially offset by negative leverage from the decrease in same-store sales. Partially offsetting the improvements was a decline due to negative leverage from the decrease in same-store sales. Goodwill impairment was as follows:. Due to the continuation of a decrease in same-store sales, the estimated fair value of the Regis salon operations was less than the carrying value of this concept's net assets, including goodwill.
Due to the impact of recent industry developments, including a slow down in revenue growth and increasing supply costs, the estimated fair value of the. Hair Restoration Centers operations was less than the carrying value of this reporting unit's net assets, including goodwill. Due to lower than expected earnings and same-store sales, the estimated fair value of the Promenade salon operations was less than the carrying value of this concept's net assets, including goodwill.
Due to the current economic conditions, the estimated fair value of the Regis salon operations was less than the carrying value of this concept's net assets, including goodwill. Lease termination costs were as follows:. The fiscal year lease termination costs are associated with the Company's June plan to close underperforming United Kingdom company-owned salons in fiscal year During fiscal year we closed 29 salons under the June plan. Interest expense was as follows:.
The increase due to the make-whole payments and other fees was partially offset by a reduction in interest expense due to decreased debt levels. Interest income and other, net was as follows:. Interest income increased as a result of higher cash balances available to earn interest, partially offset by a decline in rates. Our reported effective tax rate was as follows:. The basis point change for fiscal year is not applicable due to the income tax benefit in fiscal year compared to income tax expense in fiscal year The basis point increase in our overall effective income tax rate for fiscal year was primarily due to the impact of the goodwill impairment charges recorded during fiscal year as compared to the impact of the goodwill impairment charge recorded during fiscal year The majority of the goodwill impairment charges recorded during fiscal year were non-deductible for tax purposes.
This adversely impacted the annual effective tax rate by Additionally, the impact of employment credits related to the Small Business and Work Opportunity Act of resulted in less of a tax benefit to the annual effective tax rate when compared to the prior year. This was due to the prior year employment credits having a larger favorable impact to the prior year effective tax rate because of the lower book loss recorded during fiscal year The rate reconciliation items have a greater impact on the annual effective income tax rate in fiscal year as the magnitude of the loss from continuing operations before income taxes is less than the magnitude of income from continuing operations before income taxes in fiscal year The annual effective tax rate was favorably impacted by the employment credits related to the Small Business and Work Opportunity Tax Act of Additionally, the foreign income taxes at other than U.
In addition, a 0. The impairment charge was based on the decline in equity value of MY Style as a result of changes in projected revenue growth after the natural disasters that occurred in Japan during March Income from Discontinued Operations, net of Taxes. Income from discontinued operations was as follows:.
We compensate some of our salon employees with percentage commissions based on sales they generate, thereby enabling salon payroll expense as a percent of company-owned salon revenues to remain relatively constant. Accordingly, this provides us certain protection against inflationary increases, as payroll expense and related benefits our major expense components are variable costs of sales. In addition, we may increase pricing in our salons to offset any significant increases in wages.
Therefore, we do not believe inflation has had a significant impact on the results of our operations. The presentation below demonstrates the effect of foreign currency exchange rate fluctuations from year to year.
To present this information, current period results for entities reporting in currencies other than United States dollars are converted into United States dollars at the average exchange rates in effect during the corresponding period of the prior fiscal year, rather than the actual average exchange rates in effect during the current fiscal year. Therefore, the foreign currency impact is equal to current year results in local currencies multiplied by the change in the average foreign currency exchange rate between the current fiscal period and the corresponding period of the prior fiscal year.
Based on our internal management structure, we report three segments: North American salons, International salons and Hair Restoration Centers. Significant results of operations are discussed below with respect to each of these segments. North American Salon Revenues. Total North American salon revenues were as follows:. Great place to get hair serices done but a bad place to try to make a living. Every salon is short handed. I worked for borics twice. The first time I was just starting out, and I loved where I worked becides for the fact I was making penny's on the dollar.
I LOVED all my co-workers, we were all extreamly different from one another, which was a really good thing. We concider ourselfs as the "island of misfit toys". It was a extreamly relaxed place to work.
I stayed for two years, then dicided to try my luck else where. The management was just so backwards. My manager seemed professional to clients faces, but once she got to the back room that was all over. See starting out working there my mother was very sick with cancer, and while working there she passed away. I wasn't always in the best emotional state of mind, but never the less I showed up did my job with a smile on my face. But somehow that was never enough. She follwed us girls around critiquing every single little thing.
And if we didn't do exactly what she said, she'd start talking about us to customers, other employees, mumble curse words under her breath, slamming things, pretty much throwing a tantrum. Instead of being adult about it, she turned the entire salons feeling hostile. She was a 40 some year old woman that made the smallest error the biggest thing. I couldn't bare to be disrespected much longer and had no choice but to quit. But on a normal night I'd have just enough time, but she had discovered that all of the products were labeled with the wrong prices that same day and me and one other girl were working from the moment we got there in between clients to get the prices finished for her, and the entire day almost she was in the back room not doing any of the prices with us.
Well when 8 o'clock came there was still maybe a sheet or a sheet and a half left to do, and before she said that she counted the register and she was throwing one of her tantrums that she threw quite often like I said before and miss counted it, she of course accused me and my coworker of taking it and she said we'd have to put in the difference out of our tips, I was like oh no no no. I went over and as figured she was wrong the register was perfect. Then after that she said we couldn't leave till the labels were done,which would mean I would miss my ride home and be stranded 2 bus trips away from home.
I said no flat out I had had it with her episodes and tanturms, my coworker had a 1 year old baby to get home to on top of that. So I told her all about herself in that cause I just couldn't restrain from doing so any longer. She should of been working with us putting them labels on, and for her being the manager she sure didnt show any care to how I would be getting home that night, or the one year old baby my coworker needed to get home too. I couldn't help but to snap especially cause my emotional state on mind. I'm normally a relaxed person and easy to get along with but she sure did bring out the worst of me in that instants.
I wasn't fired for telling her off, actually she didn't even write me up or mention it to the district leader. She knew she was wrong and she would've gotten in more trouble then me. I shortly walked out on the job after that, and didn't even go back to retrieve my license and scissors. She made me second guess my whole perfession. I was traumatized. But not to worry I am back up on the horse with a new pair of scissors. She can't keep me down. Okay place to work.
I loved my store and loved the people I worked with. I wasn't able to make much money and I felt like I was easily replaced. If you enjoy what you are doing you will enjoy your job :. Salon Manager Duties my responsibilities were done on a weekly base include scheduling, productivity, closeout book, product orders, cycle counts and WIG huddles. As a hair stylist I give a great haircuts and shampoos to every client.
While working with clients you should be able to ask if they need their hair color refreshed or perhaps a waxing service. I like to recommend hair products to clients that would be ideal for their hair type and introduce them to promotional products as well. Here are some of my daily responsibilities were review my goals, logging in clients properly and keeping a clean work station and salon. My monthly responsibilities were to clean product shelves, attend store meeting along with learning salon coupon codes.
I loved working here. Plus, Great Clips has shown that they can be innovative with technology as well. In , they began offering Online Check-in , allowing people to check wait times at nearby salons and add their names to a wait list before heading to the salon of their choice.
Additionally, Clip Notes, offered beginning in , lets stylists add notes about customer preferences to a franchise-wide cloud base that can be accessed at any salon.
I will post new pictures of styles and trends as I become aware of them. Everyone gets along with no problems. They transform the way your practice grows. To learn more and place your order, contact your Bayer sales representative today. Forty-three franchise salons were not included in the sale of Trade Secret to the purchaser of Trade Secret and are not reported as discontinued operations.
Great Clips offers a variety of hair cuts and styling services and serves everyone from children to senior citizens. Children and senior citizens can enjoy discounted haircut prices. Clients can simply walk in and request any service because no services require appointment times. Haircuts and trims are among the most popular services requested.
Individuals can also get low-priced trims for their bangs, beards or necks. Shampoo and styling can be added on to any haircut or can be chosen alone for a blow-out. Conditioning treatments are great for overly-styled, frizzy or very dry hair to make the hair smooth and soft again. Some salons also offer perms and wave treatments. Each salon offers a variety of haircare products designed for all hair types and needs.
However, they also offer three of their own brands, which can only be found at Great Clips Salons. Solutions by Great Clips provides basic hair care that fits most everyday needs. Tea Tree Solutions uses natural products with pure oils and delightful fragrances for holistic haircare.