Regis Corp (RGS) 2024 Q3 法說會逐字稿

Good morning, and thank you for joining the Regis Third Quarter Fiscal 2024 Earnings Conference Call. I'm your host, Biz McShane, Vice President, Corporate Controller. (Operator Instructions) This conference is being recorded. The prepared remarks by our President and Chief Executive Officer, Matthew Doctor; and Executive Vice President and Chief Financial Officer, Kersten Zupfer, are accompanied by slides to help participants follow along.

早安，感謝您參加瑞吉 2024 財年第三季財報電話會議。我是主持人 Biz McShane，公司財務副總裁。（操作員指示）本次會議正在錄製中。我們的總裁兼執行長 Matthew Doctor 準備的演講；執行副總裁兼財務長 Kersten Zupfer 均附有幻燈片，以幫助參與者跟進。

I would like to remind everyone that the language on forward-looking statements included in our earnings release and 8-K filing also apply to our comments made on the call today. These documents, along with our presentation today, can be found on our website, www.regiscorp.com/investorrelations, along with reconciliation of any non-GAAP financial measures mentioned on today's call with their corresponding GAAP measures. Today's slides are located in the Investor Presentations and Supplemental Financial Statements section of the investor site. With that, I will now turn the call over to Matt.

我想提醒大家，我們的收益發布和 8-K 文件中包含的前瞻性陳述的語言也適用於我們今天在電話會議上發表的評論。這些文件以及我們今天的簡報可以在我們的網站 www.regiscorp.com/investorrelations 上找到，以及今天電話會議中提到的任何非公認會計原則財務指標與其相應的公認會計原則指標的調節表。今天的幻燈片位於投資者網站的投資者簡報和補充財務報表部分。現在，我將把電話轉給馬特。

Thank you, Biz. Good morning, everyone. Before I jump into our Q3 fiscal 2024 results, just a quick note about our strategic review process.

謝謝你，比茲。大家，早安。在我進入 2024 年第三季財報之前，先簡單介紹一下我們的策略審查流程。

As I've noted on prior calls, this effort is aimed towards improving the health of our balance sheet and best position the business for long-term profitable growth. We are making progress on the review and will not be otherwise be disclosing any new developments on the call today. As Kersten and I will discuss, we will remain focused on executing our strategic plan as this process continues.

正如我在之前的電話會議中指出的那樣，這項努力的目的是改善我們資產負債表的健康狀況，並為業務的長期盈利增長提供最佳定位。我們正在審查方面取得進展，並且不會在今天的電話會議上披露任何新進展。正如克爾斯滕和我將討論的那樣，隨著這一過程的繼續，我們將繼續專注於執行我們的策略計劃。

Now with that, let's turn to the quarter. Same-store sales rose 0.5% in the quarter and 1.4% year-to-date. We saw a similar progression in comparable sales throughout the quarter, just as we did in our last quarter, which is our fiscal Q2. Weather had a significant impact to the start of our fiscal Q3, as the first 3 weeks ending January 21 demonstrated comps down 6.2%. Our salons did a good job during the rest of the quarter, making up for that lost ground as we ended the month of January with a negative 3% sales comp, followed by positive 1.3% comps in February and a 2.8% positive comp in March. The disparity I mentioned last quarter between our top and bottom quartile salons that has been a recurrent theme is still a factor here, which is driving the overall sales comp as well, with our top quartile salons by sales volume across all of our brands collectively demonstrating approximately 5% same-store sales growth for the quarter.

現在，讓我們轉向本季。同店銷售額本季成長 0.5%，年初至今成長 1.4%。我們在整個季度的可比銷售額中看到了類似的進展，就像我們在上個季度（即我們的第二財季）所做的那樣。天氣對我們第三財季的開始產生了重大影響，截至 1 月 21 日的前 3 週，公司業績下降了 6.2%。我們的沙龍在本季度剩餘時間表現出色，彌補了 1 月份銷售同比下降 3% 的損失，隨後 2 月份銷售額同比增長 1.3%，3 月份銷售額同比增長 2.8% 。我上個季度提到的頂部和底部四分之一沙龍之間的差異一直是一個反覆出現的主題，這仍然是這裡的一個因素，這也推動了整體銷售競爭，我們所有品牌銷量最高的四分之一沙龍共同證明了這一點該季度同店銷售額增長約 5%。

Adjusted Q3 EBITDA on a consolidated basis was $5 million compared to $4.2 million in the prior year's quarter, putting us back on track for year-over-year progress and profitability. For the first 3 quarters of fiscal 2024, our adjusted EBITDA of $18.5 million versus -- is a $2.7 million improvement versus the first 3 quarters of fiscal 2023 adjusted EBITDA of $15.8 million.

調整後的第三季 EBITDA 合併後為 500 萬美元，而去年同期為 420 萬美元，使我們重回同比進展和盈利的正軌。2024 財年前 3 季度，我們的調整後 EBITDA 為 1,850 萬美元，與 2023 財年前 3 季調整後 EBITDA 1,580 萬美元相比，提高了 270 萬美元。

We continue to make progress on our reported operating income with $4.1 million in the quarter versus $2.0 million in Q3 fiscal '23, a $2.1 million improvement. Operating income for the first 3 quarters has improved by $11.1 million versus the prior year at $16.3 million versus $5.2 million during the first 3 quarters of fiscal '23. From a liquidity perspective, we continue to have ample liquidity and have made progress in limiting our cash use despite the headwinds that remain in our business. We ended the quarter with approximately $37 million of liquidity and were roughly breakeven regarding cash from operations for the quarter.

我們報告的營業收入持續取得進展，本季達到 410 萬美元，而 23 財年第三季的營業收入為 200 萬美元，增加了 210 萬美元。前 3 個季度的營業收入比前一年增加了 1,110 萬美元，達到 1,630 萬美元，而 23 財年前 3 個季度的營業收入為 520 萬美元。從流動性角度來看，儘管我們的業務仍然存在阻力，但我們仍然擁有充足的流動性，並且在限制現金使用方面取得了進展。本季末，我們的流動資金約為 3,700 萬美元，本季營運現金大致實現損益兩平。

From a salon count perspective, we continue to see declines in our franchisee store count. Over the quarter, we had net closures of 124 versus 139 during Q3 2023. On a year-to-date basis, we've had net closures of 268 versus 339 during the first 3 quarters of fiscal 2023. I've discussed on each of our calls that this is a dynamic that is ongoing and, unfortunately, one that is fairly unavoidable, with these closure salons averaging $131,000 in sales for the last 12 months of being open, which is less than half of the system average and 1/3 of the top quartile average of close to $400,000 for the last 12 months.

從沙龍數量的角度來看，我們的特許經營店數量持續下降。本季度，我們的淨關閉數量為 124 家，而 2023 年第三季為 139 家。年初至今，我們在 2023 財年前 3 季淨關閉的工廠數量為 268 家，而 2023 財年前 3 季為 339 家。我在每次通話中都討論過，這是一種持續的動態，不幸的是，這是不可避免的，這些關閉的沙龍在過去12 個月的營業時間中平均銷售額為131,000 美元，不到營業額的一半。

We expect this trend to continue, and we will ultimately get to a point where we reestablish a foundation with a lower salon count albeit with a base of higher sales volumes. And don't get me wrong, while I have looked to lay out the potential benefits to come with shedding salons with significant losses borne by our franchisees, this is absolutely not a celebrated effort as even losing low-volume salons means we lose revenue as a franchisor and the potential brand perception implications. However, these closures do ultimately strengthen the underlying franchisee base given the drag these salons have on their profitability, especially as our franchisees work hard to build their businesses back.

我們預計這種趨勢將持續下去，我們最終將達到一個地步：儘管銷售基礎較高，但沙龍數量較少，我們將重新建立基礎。不要誤會我的意思，雖然我一直在闡述脫髮沙龍的潛在好處，而我們的特許經營商卻承擔了重大損失，但這絕對不是一個值得讚揚的努力，因為即使失去小批量的沙龍也意味著我們會損失收入，因為特許人和潛在的品牌認知影響。然而，考慮到這些沙龍對其盈利能力的拖累，這些關閉最終確實會加強潛在的加盟商基礎，特別是在我們的加盟商努力重建業務的情況下。

It's the reality that we face. And despite these closures, we have managed to operate the business in a manner which allows us to continue to grow profitability, and it is this smaller base of stronger salons that our efforts will be pointed towards in order to drive performance going forward.

這就是我們面臨的現實。儘管有這些關閉，我們仍然設法以一種能夠繼續提高盈利能力的方式經營業務，而我們的努力將針對這個規模較小、實力較強的沙龍，以推動未來的業績。

In recent quarters, you've heard me speak about our 6 priority areas of focus, each of which will help ensure the stability and longevity of Regis. The first being addressing our capital structure. And as I alluded to earlier, we are in the midst of our strategic review process with the goal of addressing this for the long term. The other 5 priorities relate to the core business, and we will continue to make progress on these areas, and I would like to share some developments related to these initiatives on the call today. I want to reiterate that many of these are foundational back-to-basics initiatives, and you'll notice they're a bit different from others that we've been speaking about in the past and at this time, after trial and error, we strongly believe is what our system requires to unlock the potential of our brands and set them up for success going forward.

最近幾個季度，您已經聽到我談論我們的 6 個優先重點領域，每個領域都將有助於確保 Regis 的穩定性和壽命。首先是解決我們的資本結構問題。正如我之前提到的，我們正在進行策略審查過程，目標是長期解決這個問題。另外5個優先事項與核心業務相關，我們將繼續在這些領域取得進展，我想在今天的電話會議上分享與這些舉措相關的一些進展。我想重申，其中許多都是基礎性的回歸基礎的舉措，你會注意到它們與我們過去討論過的其他舉措有點不同，在經過反複試驗後，我們堅信，這是我們的系統所需要的，可以釋放我們品牌的潛力，並為它們未來的成功奠定基礎。

Our first and primary area of focus is customer experience, which we have been working to improve by honing our consistency and processes across our salons to revamp development, rollout and enforcement of brand standards. I view this as the #1 priority to drive salon operations going forward, and I am excited as this is a very much needed effort having observed disparities in operations and procedures throughout our salons. These disparities are not the result of any singular event or reason but rather a by-product of various historical initiatives that Regis had over the years in addition to the need for stabilization and survival during recent times.

我們首要關注的領域是客戶體驗，我們一直在努力透過磨練整個沙龍的一致性和流程來改善客戶體驗，以改善品牌標準的開發、推出和執行。我認為這是推動沙龍運營向前發展的第一要務，我很興奮，因為在觀察到整個沙龍運營和程序方面的差異後，這是一項非常需要的努力。這些差異並不是任何單一事件或原因的結果，而是除了近年來穩定和生存的需要之外，瑞吉斯多年來採取的各種歷史舉措的副產品。

While there's no doubt been a focus in the past, for the first time in many years, customer experience through service excellence will be the #1 priority of our organization. The initial rollout will start in our Supercuts brand. And this past quarter, we made good progress on that front by aligning on the revised set of standards, which will be accompanied by a complete overhaul of franchisee and stylist training materials.

雖然過去毫無疑問是一個焦點，但多年來第一次，透過卓越服務提供客戶體驗將成為我們組織的第一要務。最初的推出將從我們的 Supercuts 品牌開始。上個季度，我們透過調整修訂後的標準，在這方面取得了良好進展，同時也將對加盟商和造型師培訓教材進行全面改革。

We are also narrowing in on the manner in which we will be ensuring we have eyes on each one of our salons over the course of the year -- something we haven't had for quite some time and, frankly, can no longer continue. Having clear views on each of our salons and where they land on the ability to deliver a quality environment and service excellence is critical. And we expect to start implementing this in full force towards the end of this calendar year. I view this as the next significant change management exercise for our system now that we are coming up on the end of the Zenoti technology platform rollout, which I will speak about next.

我們還縮小了範圍，以確保我們在這一年中關注每一個沙龍——這是我們已經有一段時間沒有關注的事情了，坦率地說，不能再繼續下去了。對我們的每家沙龍以及它們提供優質環境和卓越服務的能力有清晰的認識至關重要。我們預計將在今年底開始全面實施這項措施。我認為這是我們系統的下一個重大變更管理活動，因為我們即將推出 Zenoti 技術平台，接下來我將對此進行討論。

We've spoken about this transition of our salon to the Zenoti point-of-sale system for almost 2 years now as this forms the foundation of yet another key to reviving the customer experience. We are pleased to have this finish line for this transition in sight, which will mark the end of what has not only been a 2-year journey to Zenoti but really a 7-year technology journey for Regis when taking into account the development of OpenSalon Pro back in 2017. This transition will not only help increase digital engagement with our customers and ensure a seamless and reliable user experience but will also increase our data capture so we can better engage with our customers in a more personalized manner across the board. We're already seeing some early operational benefits that we plan on rallying around once the system is on the platform.

我們已經談論我們的沙龍向 Zenoti 銷售點系統的過渡近兩年了，因為這構成了恢復客戶體驗的另一個關鍵的基礎。我們很高興看到這一過渡的終點線，這不僅標誌著 Zenoti 的 2 年旅程的結束，而且考慮到 OpenSalon 的發展，Regis 也真正經歷了 7 年的技術之旅2017 年的專業版。這項轉變不僅有助於增加與客戶的數位互動，確保無縫、可靠的用戶體驗，而且還將增加我們的數據捕獲，以便我們能夠以更個性化的方式更好地與客戶互動。我們已經看到了一些早期的營運效益，我們計劃在系統上線後立即利用這些效益。

By and large, our efforts to date really have been focused, first and foremost, on the migration itself. Once that is complete, the real work begins to put it to full use. That said, organic online booking continues to prove fruitful. Salons with more online booking availability continue to outpace the system from a sales and traffic perspective, and this notion of advanced booking is made simpler on Zenoti and is one of the many key benefits it brings. In addition, we've noticed a significant uptick in our Google review footprint just by being on the Zenoti platform and leveraging its post-visit guest feedback capabilities, which in turn help drive search ranking and online presence. Now while these are just a few organic examples, we have not even scratched the surface with this platform, and we are excited to start utilizing it with intention as an execution tool for our customers and franchisee stylists.

總的來說，我們迄今為止的努力實際上首先集中在遷移本身。一旦完成，真正的工作就開始充分利用它。也就是說，有機線上預訂仍然卓有成效。從銷售和流量的角度來看，具有更多線上預訂可用性的沙龍繼續超越系統，而這種提前預訂的概念在 Zenoti 上變得更加簡單，也是它帶來的眾多關鍵優勢之一。此外，我們注意到，僅透過 Zenoti 平台並利用其訪問後訪客回饋功能，我們的 Google 評論足跡就顯著增加，這反過來又有助於推動搜尋排名和線上形象。現在，雖然這些只是一些有機的例子，但我們甚至還沒有觸及這個平台的表面，我們很高興開始有意利用它作為我們的客戶和加盟造型師的執行工具。

As of Friday, April 26, we had close to 2,600 salons to migrate to the Zenoti platform. This is up from 1,600 salons in our last earnings call, and we are on track to completing our migrations this summer, likely with the last salons migrating in July. We have completed the transition of all SuperSalon users to Zenoti, so all that is left now are those on OpenSalon Pro. And from a migration payment perspective, we will likely cross that salon count payment threshold this fiscal Q4 and receive payments in Q1 and Q2 fiscal 2025. As a reminder, we have received $20 million in proceeds to date, which has gone towards servicing our debt.

截至 4 月 26 日星期五，我們有近 2,600 家沙龍需要遷移到 Zenoti 平台。這高於我們上次財報電話會議中的 1,600 家沙龍，我們預計在今年夏天完成遷移，最後一批沙龍可能會在 7 月完成遷移。我們已經完成了所有 SuperSalon 用戶到 Zenoti 的轉換，所以現在剩下的就是 OpenSalon Pro 上的用戶了。從移民支付的角度來看，我們可能會在本財年第四季突破沙龍計數支付門檻，並在 2025 財年第一季和第二季收到付款。提醒一下，迄今為止，我們已收到 2000 萬美元的收益，這些收益已用於償還我們的債務。

Executing on brand standards and utilizing Zenoti are the 2 initiatives that really formed the foundation of our salon operations priorities. With these in place and ready to be executed on is where we will build the business. And our next major priority is the rollout of targeted promotions and loyalty strategies to drive traffic and sales.

執行品牌標準並利用 Zenoti 是真正構成我們沙龍營運優先事項基礎的兩項舉措。有了這些並準備好執行，我們就可以開展業務了。我們的下一個主要優先事項是推出有針對性的促銷和忠誠度策略，以推動流量和銷售。

One of the key initiatives here is the development and rollout of our Supercuts loyalty program, Supercuts Rewards. This has moved out of the test phase and into full rollout. Our first wave of salons include 350 going live by the end of May, with the expectation this will be a brand standard for all of Supercuts in 2024 with all remaining salons participating by the end of September this year. Now based on the results that we see from this launch, we can pivot and take relevant elements to roll out across our other brands in addition to other promotion strategies that we are running. When thinking about the differentiating areas of our brands and where we will win, these 3 initiatives are all key pieces of the equation with the salon experience underpinned by enforced standards, convenience and connections through Zenoti and stickiness through a powerful loyalty program, which is fairly nascent in our industry.

這裡的關鍵舉措之一是開發和推出我們的 Supercuts 忠誠度計畫 Supercuts 獎勵。這已經結束了測試階段並進入全面推出階段。我們的第一波沙龍包括 350 家沙龍，將於 5 月底上線，預計這將成為 2024 年所有 Supercuts 的品牌標準，所有剩餘沙龍將於今年 9 月底參與。現在，根據我們從這次發布中看到的結果，除了我們正在運行的其他促銷策略之外，我們還可以轉向並採取相關元素在我們的其他品牌中推廣。在考慮我們品牌的差異化領域以及我們將在哪裡獲勝時，這三項舉措都是等式的關鍵部分，沙龍體驗以強制標準、Zenoti 的便利性和聯繫以及強大的忠誠度計劃的粘性為基礎，這是相當不錯的。

The fourth focus area I want to address on this call is the backbone of execution in salons, the stylists. We know how important it is for stylists to be equipped with the best education in the most current trends, techniques and soft skills to provide superior excellence for the customer. We have a robust network of corporate and franchisee employee trainers to ensure stylists have the tools and training they need to deliver quality hair services. Our training program is a differentiator for us and often the reason franchisees choose Regis. In-person training is supplemented with our proprietary digital training program known as the Regis Education Playground, and that has engaging digital training modules for our stylist community.

我想在這次電話會議上討論的第四個重點領域是沙龍執行的支柱，即造型師。我們知道，對於造型師來說，接受最新趨勢、技術和軟技能的最佳教育對於為客戶提供卓越的服務是多麼重要。我們擁有強大的企業和加盟商員工培訓師網絡，以確保造型師擁有提供優質美髮服務所需的工具和培訓。我們的培訓計畫是我們的優勢所在，也是加盟主選擇瑞吉斯的原因。面對面培訓還輔以我們專有的數位培訓計劃（稱為瑞吉斯教育遊樂場），該計劃為我們的造型師社群提供了引人入勝的數位培訓模組。

As we look forward, we're thinking about innovative ways to deliver an even more enhanced education experience. We firmly believe having both live training and digital components are foundational elements of stylist training, and we're looking to further bolster continuous engagement by leaning into AI and digital learning. Franchisees looking to address the turnover that exists at the 30, 60, 90-day marks of new hires and we believe that engaging with them through the education program and a more robust onboarding process with that right mix of live and digital education will increase engagement and drive retention of stylists past those critical points upon which they stay longer and tend to become more productive. More to come here as we continue to work through what this may look like with our franchisees.

展望未來，我們正在考慮創新的方式來提供更優質的教育體驗。我們堅信，現場培訓和數位組件是造型師培訓的基本要素，我們希望透過人工智慧和數位學習來進一步增強持續參與。特許經營商希望解決新員工 30 天、60 天、90 天的營業額問題，我們相信，透過教育計劃和更強大的入職流程以及現場和數位教育的正確組合與他們互動將提高參與度並推動造型師的保留超過他們停留更長時間並往往變得更有效率的關鍵點。隨著我們繼續與我們的特許經營商一起解決這個問題，將會有更多內容出現。

The last area I want to touch on before wrapping up is our focus on managing G&A. We are currently on track to end fiscal '24 at approximately $45 million in G&A, equating to approximately $5 million in savings versus fiscal 2023 and over $50 million in savings since fiscal '21. This marks yet another quarter we have decreased our G&A due to our continued efforts to ensure the business is appropriately sized and managed.

在結束之前我想談的最後一個領域是我們對管理一般行政費用的關注。目前，我們預計 24 財年末的一般管理費用約為 4,500 萬美元，相當於與 2023 財年相比節省了約 500 萬美元，自 21 財年以來節省了超過 5,000 萬美元。這標誌著我們又一個季度減少了一般管理費用，因為我們不斷努力確保業務規模和管理適當。

Now in closing, I would be remiss if I did not mention all of the hard work and dedication of our employees and franchisees have put into these efforts. Everyone at Regis has been heads down and focused on advancing these important initiatives that we believe will set the company up for long-term success. We know how important it is to stay agile and innovative in this field, and the back-to-basics efforts we are instituting combined with the technological advancements we're implementing to improve the customer experience and salon productivity will pay dividends as we look to improve our current operations and open new salons.

最後，如果我沒有提及我們的員工和加盟商為這些努力所付出的所有辛勤工作和奉獻精神，那我就失職了。瑞吉斯的每個人都埋頭苦幹，專注於推進這些重要舉措，我們相信這些舉措將為公司長期成功奠定基礎。我們知道在這個領域保持敏捷和創新是多麼重要，我們正在為改善客戶體驗和沙龍生產力而進行的回歸基礎的努力與我們正在實施的技術進步相結合，將會帶來回報。並開設新的沙龍。

With that, I will now turn the call over to Kersten to provide more detail on our Q3 and full year results. Kersten?

現在，我將把電話轉給 Kersten，以提供有關我們第三季和全年業績的更多詳細資訊。克斯滕？

Thanks, Matt, and good morning. For this morning's call, I will review our third quarter results.

謝謝，馬特，早安。在今天早上的電話會議中，我將回顧我們第三季的業績。

Overall, the third quarter was positive with positive system-wide same-store sales, increased operating income and increased adjusted EBITDA.

整體而言，第三季業績良好，全系統同店銷售成長，營業收入增加，調整後 EBITDA 增加。

Reviewing the third quarter in more detail and beginning with the income statement, total third quarter revenues were $49.2 million and declined $6.6 million from the prior year. This revenue decline was expected and relates primarily to a reduction in franchise rental income and advertising fund revenue, which are a gross up of revenue and expense and have no impact on profitability. Additionally, transitioning out of company-owned salons and product sales reduced revenue with minimal impact on profitability. Royalty and fee revenue of $18.3 million, which represents our core business revenue, was down $200,000 versus the prior year's third quarter due to the number of salon closures over the course of the last 12 months. Another reflection of our revenue performance is system-wide same-store sales, which grew 0.5% in the quarter.

從損益表開始更詳細地回顧第三季度，第三季度總收入為 4,920 萬美元，比去年同期下降 660 萬美元。這項收入下降是預期的，主要與特許經營租金收入和廣告基金收入的減少有關，這些收入是收入和費用的總和，對獲利能力沒有影響。此外，從公司自有沙龍和產品銷售的轉型減少了收入，但對獲利能力的影響最小。由於過去 12 個月期間沙龍關閉的數量，代表我們核心業務收入的特許權使用費和費用收入 1,830 萬美元比去年第三季減少了 20 萬美元。我們營收表現的另一個反映是全系統同店銷售額，本季成長了 0.5%。

We posted GAAP operating income of $4.1 million in the third quarter compared to $2 million in the prior year quarter. The increase in GAAP operating income of $2.1 million was driven by, primarily, a decrease in G&A expenses compared to the prior year period. We continue to produce operating profit each quarter, and we expect that trend to continue.

我們公佈的第三季 GAAP 營業收入為 410 萬美元，而去年同期為 200 萬美元。GAAP 營業收入增加 210 萬美元，主要是因為 G&A 費用較去年同期減少。我們每季都會繼續產生營業利潤，我們預計這種趨勢將持續下去。

We reported a net loss of $2.3 million and a loss per share of $1 in the third quarter compared to a loss of $1.6 million a year ago and a loss per share of $0.71. The decline in the quarter was a result of contingent sale proceeds related to our sale of OpenSalon Pro in June of 2022 of $0.5 million in the prior year period compared to no proceeds recognized in the current quarter and higher interest payments this year, partially offset by an increase in operating income.

我們報告第三季淨虧損 230 萬美元，每股虧損 1 美元，去年同期虧損 160 萬美元，每股虧損 0.71 美元。本季下降的原因是我們於 2022 年 6 月出售 OpenSalon Pro 相關的或有銷售收益，上年同期為 50 萬美元，而本季度沒有確認收益，而且今年利息支付增加，部分抵消了營業收入增加。

Now let's turn to our adjusted results, which reflects how management views the business. On an adjusted basis, third quarter consolidated EBITDA was $5 million compared to $4.2 million in the prior year quarter. The $800,000 increase was due primarily to the lower G&A costs. Our adjusted G&A was $11 million for the third quarter, a decrease of $1.3 million from the prior year quarter. The decrease is due primarily to lower headcount and timing of expenses. With our continued focus on cost structure, we now believe our annual run rate G&A will be in the range of $43 million to $46 million. Our core franchise business achieved adjusted EBITDA of $5.8 million in the quarter, a $1 million increase compared to $4.8 million in the prior year quarter. This improvement is primarily related to a reduction in G&A spend due partially to lower headcount and timing of expenses.

現在讓我們來看看調整後的結果，它反映了管理階層對業務的看法。調整後，第三季合併 EBITDA 為 500 萬美元，去年同期為 420 萬美元。增加 800,000 美元主要是由於 G&A 成本降低。第三季調整後的一般管理費用為 1,100 萬美元，比去年同期減少 130 萬美元。減少的主要原因是員工人數和費用時間安排的減少。隨著我們對成本結構的持續關注，我們現在相信我們的年度運行費率將在 4300 萬美元至 4600 萬美元之間。我們的核心特許經營業務本季調整後 EBITDA 為 580 萬美元，比去年同期的 480 萬美元增加了 100 萬美元。這項改善主要與一般管理支出的減少有關，部分原因是員工人數和支出時間的減少。

On an adjusted basis, our company-owned segment lost $800,000 for the quarter, a decline of $200,000 from the same quarter last year. The decline is due to inventory write-offs related to company-owned salon closures. With 20 company-owned salons as of March 31, our company-owned salon segment will have significantly less impact on future periods, including the remainder of fiscal year 2024.

調整後，我們公司擁有的部門本季虧損 80 萬美元，比去年同期減少 20 萬美元。下降的原因是與公司擁有的沙龍關閉相關的庫存沖銷。截至 3 月 31 日，我們公司擁有 20 家自有沙龍，因此公司自有沙龍部門對未來時期（包括 2024 財年剩餘時間）的影響將大大減少。

Revenues for the first 9 months of the year were $154 million compared to $178 million in the same period of fiscal year 2023. Similar to the second quarter revenue decline, this decline was expected and relates primarily to a reduction in franchise rental income, advertising revenue and the wind down of our company-owned salons as well as lower product sales to franchisees.

今年前 9 個月的營收為 1.54 億美元，而 2023 財年同期的營收為 1.78 億美元。與第二季收入下降類似，這種下降是預期的，主要與特許經營租金收入、廣告收入的減少和我們公司自有沙龍的關閉以及對特許經營商的產品銷售減少有關。

Adjusted EBITDA for the first 9 months of the year was $18.5 million, a $2.7 million improvement compared to $15.8 million for the same period in fiscal year 2023. Adjusted EBITDA improved primarily due to our lower G&A and rent, partially offset by the $1.1 million grant from the State of North Carolina related to COVID-19 relief received in 2023.

今年前 9 個月的調整後 EBITDA 為 1,850 萬美元，比 2023 財年同期的 1,580 萬美元增加了 270 萬美元。調整後 EBITDA 的改善主要是由於我們的一般管理費用和租金較低，但部分被北卡羅來納州 2023 年收到的與 COVID-19 救濟相關的 110 萬美元補助金所抵消。

Turning to liquidity. As of March 31, we had $36.7 million of liquidity, including $30.9 million of available revolver capacity and $5.9 million of cash. At March 31, 2024, our debt outstanding, excluding deferred financing fees, was $187.8 million. We are in compliance with our debt covenants currently, and we do not expect to violate any of the covenants during the term of our facility. Additionally, we believe we have adequate liquidity to operate the business.

轉向流動性。截至 3 月 31 日，我們擁有 3,670 萬美元的流動資金，其中包括 3,090 萬美元的可用左輪手槍容量和 590 萬美元的現金。截至 2024 年 3 月 31 日，我們的未償債務（不含遞延融資費用）為 1.878 億美元。我們目前遵守我們的債務契約，並且我們預計在融資期限內不會違反任何契約。此外，我們相信我們有足夠的流動性來經營業務。

As a reminder, due to accounting standards, our balance sheet shows approximately $313 million of operating lease liabilities related to liabilities associated with subleasing salons to our franchisees over the entire life of their respective leases. These liabilities are serviced by our franchisees and should not be factored in Regis' debt position so long as the franchisees continue to pay their obligations as they have been. These liabilities have decreased approximately $230 million over the last 3 years due to the reduction in salon count and also due to Regis moving off of franchise leases. Having our franchisees sign the leases accounted for approximately $95 million of the reduction. Regis is solely responsible for lease liabilities for our corporate office space and the 20 remaining company-owned salons, which amounts to $9.7 million over the life of all the leases.

提醒一下，根據會計標準，我們的資產負債表顯示大約 3.13 億美元的營業租賃負債，這些負債與在整個租賃期內將沙龍轉租給我們的特許經營商相關的負債有關。這些負債由我們的特許經營商承擔，只要特許經營商繼續按原樣償還債務，就不應該計入瑞吉斯的債務狀況。由於沙龍數量的減少以及瑞吉斯取消特許經營租賃，這些負債在過去 3 年中減少了約 2.3 億美元。我們的特許經營商簽署租約減少了約 9500 萬美元。Regis 全權負責我們公司辦公空間和剩餘 20 家公司自有沙龍的租賃負債，在所有租賃期間內總計達 970 萬美元。

In the 9 months of the year, we used $7.1 million of cash from operations, which is a $1.3 million improvement from the prior year. Excluding the $1.1 million grant received from the State of North Carolina related to COVID-19 relief in fiscal year 2023, cash used in operations improved by $2.4 million, primarily due to our lower cost structure, partially offset by increased interest expense of approximately $3.3 million due primarily to higher variable interest rates on our bank debt. In the 3 months ended March 31, we used $280,000 of cash from operations, which is a $1.3 million improvement from the prior year 3-month period, primarily due to our lower cost structure and partially offset by increased interest expense of approximately $700,000, primarily due to the higher variable interest rates on our bank debt. Management remains committed to continued cash management and returning to cash generation.

今年前 9 個月，我們使用了 710 萬美元的營運現金，比前一年增加了 130 萬美元。不包括從北卡羅來納州收到的與2023 財年COVID-19 救濟相關的110 萬美元補助金，營運中使用的現金增加了240 萬美元，這主要是由於我們較低的成本結構，部分被約330 萬美元的利息支出增加所抵銷主要是由於我們銀行債務的可變利率較高。在截至3 月31 日的3 個月中，我們使用了28 萬美元的營運現金，比去年3 個月期間增加了130 萬美元，這主要是由於我們較低的成本結構，部分被增加的約70 萬美元的利息支出所抵消，主要是由於我們銀行債務的可變利率較高。管理層仍致力於持續現金管理並回歸現金產生。

This concludes my prepared remarks. I would like to thank you for your continued support and interest in Regis. I will turn it back to Biz to wrap up the call.

我準備好的發言到此結束。我要感謝您對瑞吉斯的持續支持與關注。我會將其轉回給 Biz 以結束通話。

Thanks, Kersten, and thank you for joining. This will conclude today's earnings call. If you have any questions about our financial results, please contact Kersten through our Investor Relations e-mail at investorrelations@regiscorp.com.

謝謝克爾斯滕，也謝謝您的加入。今天的財報電話會議到此結束。如果您對我們的財務表現有任何疑問，請透過我們的投資者關係電子郵件與 Kersten 聯絡：investorrelations@regiscorp.com。