THE WHAT? Sally Beauty has announced its financial results for the second quarter of the financial year, ended March 31, 2020.
THE DETAILS Same store sales dropped 7.1 percent for the entire quarter. Prior to March 12 (the COVID-19 inflection date), sales were up 4.7 percent.
“The Company was on track for an excellent quarter, having achieved important milestones in its digital and retail transformation,” said Chris Brickman, President and CEO. “When COVID-19 struck, the company accomplished an incredibly adept pivot. I would like to recognize the amazing people at SBH who in a few short weeks pivoted the company to dramatically reduce our cost structure and manage cash, aggressively reinforce liquidity, accelerate the roll-out of in-demand delivery service models, and manage through a massive increase in online demand. Our teams, led by our store and distribution center teams, are the real stars of this story and because of them we expect to emerge as a transformed enterprise with a much larger digital footprint and an even stronger competitive position in professional hair color and hair care. In addition, with our recent capital markets transactions, we believe we have enhanced our financial flexibility and are well-positioned to survive a prolonged downturn and emerge from this crisis stronger.”
Indeed, shipped e-commerce sales for Sally US & Canada retail were up 118 percent in March, and 872 in April (which forms part of Q3), thanks to the company’s pre COVID-19 launch of a Canadian e-commerce site and the rapid expansion of its US ship-from-store capability as stores were shuttered; this facility is now enabled at some 1,100 locations nationwide.
THE WHY? The COVID-19 pandemic forced the shutdown of customer-facing operations in virtually all global stores in mid-March but the company’s rapid scale up of its e-commerce arm has helped keep sales losses in the single digits.