THE WHAT? Sally Beauty Holdings has reported a Q3 net sales decline of 27.7 percent to $705.3 million, driven by retail closures at almost all of its global operations due to the pandemic.
THE DETAILS Other factors detailed by the company include a smaller store base, with 27 fewer stores compared to the prior year, and an unfavorable impact from foreign currency translation of approximately 30 basis points on reported sales.
However, the difficulties were said to be partially offset by a surge in e-commerce activity, with online sales reaching $137 million for the third quarter, a growth of 278% YOY.
Chris Brickman, President and Chief Executive Officer, said, “We executed exceptionally well during a disrupted third quarter. The team aggressively managed costs and cash, drove an accelerated pivot to support digital growth and scale our key digital transformation initiatives, and reopened the store network faster than competitors.”
Per segment, Sally Beauty Supply reported same store sales decrease of 25.9 percent, while the Beauty Systems Group fell 27.9 percent.
THE WHY? While the company has withdrawn its full year guidance due to the uncertainty of COVID-19, Brickman spoke of its commitment to expand its digital capabilities going forward.
He said, “Because of the speed and agility of our team, we are well positioned to take advantage of emerging customer trends and gain share in a disrupted environment. As we enter the fourth quarter, we will continue to invest in our digital transformation, take advantage of the strong demand for our key categories, adapt quickly to any new local restrictions or changes to consumer shopping behavior tied to the pandemic, and stay disciplined in terms of cost and cash management.”