Sally Beauty Holdings Inc (SBH) 2024 Q2 法說會逐字稿

Good morning, everyone, and welcome to the Sally Beauty Holdings Conference Call to discuss the company's second quarter fiscal 2024 results. (Operator Instructions)

大家早安，歡迎參加 Sally Beauty Holdings 電話會議，討論該公司 2024 財年第二季業績。（操作員說明）

Now I would like to turn the call over to Jeff Harkins, Vice President of Investor Relations and Treasurer for Sally Beauty Holdings. Please go ahead.

現在我想將電話轉給 Sally Beauty Holdings 投資者關係副總裁兼財務主管 Jeff Harkins。請繼續。

Thank you. Good morning, everyone, and thank you for joining us. With me on the call today are Denise Paulonis, President and Chief Executive Officer; and Marlo Cormier, Chief Financial Officer.

謝謝。大家早安，感謝您加入我們。今天與我一起參加電話會議的是總裁兼執行長 Denise Paulonis；和財務長 Marlo Cormier。

Before we begin, I'd like to remind everyone that management's remarks on this call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the risk factors section of our most recent annual report on Form 10-K and other filings with the SEC. Any forward-looking statements made on this call represent our views only as of today, and we undertake no obligations to update them. The company has provided a detailed explanation and reconciliations of its adjusting items and non-GAAP financial measures in its earnings press release and on its website.

在開始之前，我想提醒大家，管理階層在本次電話會議上的言論可能包含 1995 年《私人證券訴訟改革法案》含義內的前瞻性陳述。由於各種重要因素的影響，實際結果可能與這些前瞻性陳述所顯示的結果有重大差異，包括我們最近的 10-K 表格年度報告和向 SEC 提交的其他文件的風險因素部分中討論的因素。本次電話會議中所做的任何前瞻性陳述僅代表我們今天的觀點，我們不承擔更新這些陳述的義務。該公司在其收益新聞稿和網站上提供了對其調整項目和非公認會計原則財務指標的詳細解釋和調節。

Now I'd like to turn the call over to Denise to begin the formal remarks.

現在我想把電話轉給丹尼斯，讓她開始正式發言。

Thank you, Jeff, and good morning, everyone. Our teams navigated dynamic sales trends during the second quarter while continuing to execute against our strategic priorities and deliver engaging experiences for our customers.

謝謝你，傑夫，大家早安。我們的團隊在第二季度掌握了動態銷售趨勢，同時繼續執行我們的策略重點並為客戶提供引人入勝的體驗。

Net sales came in at the lower end of our expectations at $908 million, down 1% and comparable sales declined 1.5%. Our sales results reflect notable strength and momentum in our BSG segment, offset by softer sales performance at Sally amidst weather challenges in January and ongoing customer frugality. Adjusted gross margin was 51%, which came in lower than we anticipated due to higher promotional penetration as well as an unfavorable sales mix shift out of our highest margin Sally US business.

淨銷售額為 9.08 億美元，低於我們預期的下限，下降 1%，可比銷售額下降 1.5%。我們的銷售業績反映了 BSG 部門的顯著實力和勢頭，但由於 1 月份的天氣挑戰和持續的客戶節儉，Sally 的銷售業績疲軟，抵消了這一影響。調整後的毛利率為 51%，低於我們的預期，原因是促銷滲透率較高，以及我們利潤率最高的 Sally 美國業務的不利銷售組合轉移。

We continue to execute solid cost controls with adjusted SG&A of 1% versus last year, in line with our expectations. The business generated solid cash flow from operations of $37 million, allowing us to return value to shareholders via continued share repurchase activity. We also strengthened the balance sheet with the refinancing of our 2025 senior unsecured notes. More on that later from Marlo.

我們繼續執行穩健的成本控制，調整後的 SG&A 較去年下降 1%，符合我們的預期。該業務產生了 3700 萬美元的穩定現金流，使我們能夠透過持續的股票回購活動向股東回報價值。我們也透過 2025 年優先無抵押票據的再融資強化了資產負債表。馬洛稍後會對此進行更多介紹。

Let's take a look at performance by segment. At BSG, Q2 comparable sales were up 2%, a bit ahead of our expectations. This represents the second consecutive quarter of positive comps and reflects continuing improvement in salon demand trends paired with a robust flow of product innovation. Comparable transactions increased 2% and average ticket value was flat to the prior year.

我們來看看各細分市場的表現。BSG 在第二季度可比銷售額成長 2%，略高於我們的預期。這是連續第二季出現積極的業績，反映了沙龍需求趨勢的持續改善以及強勁的產品創新流。可比交易量增加 2%，平均票價與上年持平。

We are pleased to see momentum returning to BSG with color and care, both in positive territory. It is clear that our stylists are seeking value, which was reflected in the strength of our quarterly customer appreciation sales. In our Sally segment, sales were at the low end of our expectations for the quarter as our customers continue to exhibit cautious shopping behavior. Q2 comparable sales declined 4% with comparable transactions down 5% and average ticket value up 1%.

我們很高興看到 BSG 在色彩和護理方面恢復了勢頭，兩者都處於積極的領域。顯然，我們的造型師正在尋求價值，這反映在我們季度客戶感謝銷售的強勁勢頭中。在我們的 Sally 部門，由於我們的客戶繼續表現出謹慎的購物行為，本季銷售額處於我們預期的低端。第二季可比銷售額下降 4%，可比交易量下降 5%，平均票價上漲 1%。

Looking at the cadence of the quarter. As we shared on our Q1 call, we started the quarter with about $10 million of weather impact to January, which put outsized pressure on transactions for the quarter. Subsequently, Sally returned to a more normalized traffic and transaction trend line at the end of the month and into early February. Although transactions continued to improve throughout the quarter, our Sally US and Canada customers demonstrated price sensitivity, leaning into promotions more heavily than we've seen in recent quarters, negatively impacting average unit retail. While promo offerings were approximately flat year over year, we believe the macro backdrop had a heightened impact on the increased take rate of promotional items by our lower income consumers who are seeking value in response to the inflationary environment, including elevated credit card and buy now pay later balances with higher interest rates.

看看本季的節奏。正如我們在第一季電話會議上分享的那樣，本季一開始，天氣對 1 月的影響約為 1000 萬美元，這給本季的交易帶來了巨大的壓力。隨後，Sally 在月底和 2 月初恢復到更正常的流量和交易趨勢線。儘管整個季度的交易量持續改善，但我們的 Sally 美國和加拿大客戶表現出了價格敏感性，比最近幾季更傾向於促銷，這對平均單位零售量產生了負面影響。雖然促銷產品與去年同期相比大致持平，但我們認為，宏觀背景對低收入消費者對促銷產品的購買率產生了更大的影響，他們正在尋求價值以應對通貨膨脹環境，包括提高信用卡和立即購買以更高的利率支付稍後的餘額。

As we have seen both our stylists and our retail customers increased their promotional purchases in recent months, we are partnering with our vendors and we are adjusting our tactics, including looking at the design, depth, and duration of our offers. We're taking these actions while remaining intensely focused on retaining and growing loyalty among our shoppers by leveraging our strategic initiatives from innovation to marketplaces and beyond. To that end, our ongoing focus on our core strategic initiatives, enhancing our customer centricity, growing our high margin owned brands and amplifying innovation and increasing the efficiency of our operations is bearing fruit.

由於我們看到我們的造型師和零售客戶近幾個月來都增加了促銷購買，因此我們正在與供應商合作，並調整我們的策略，包括考慮我們優惠的設計、深度和持續時間。我們在採取這些行動的同時，仍然高度關注透過利用我們從創新到市場及其他領域的策略性舉措來保留和提高購物者的忠誠度。為此，我們持續專注於核心策略措施、加強以客戶為中心、發展高利潤自有品牌、擴大創新並提高營運效率，這些措施正在取得成果。

In Q2, product innovation, territory expansion, and new services contributed over 250 basis points to our comparable sales results, and we remain on track to achieve 200 to 300 basis points of contribution from these initiatives for the full year. There are a number of highlights from the quarter and actions planned for the second half.

第二季度，產品創新、領土擴張和新服務為我們的可比較銷售業績貢獻了超過 250 個基點，我們仍有望在全年從這些舉措中實現 200 至 300 個基點的貢獻。本季有許多亮點以及下半年計劃採取的行動。

Starting with product innovation. This continues to be an important driver of growth and customer engagement in both our BSG and Sally segment. At BSG, we recently secured substantial territory expansion with two important brands. We added key geographies with Moroccan Oil, and we're now selling Amika across all stores and e-com in the US and Canada.

從產品創新入手。這仍然是我們 BSG 和 Sally 部門成長和客戶參與的重要驅動力。在 BSG，我們最近透過兩個重要品牌實現了大幅領土擴張。我們在主要地區添加了摩洛哥石油，現在我們在美國和加拿大的所有商店和電子商務網站上銷售 Amika。

We also added two new compelling brands to our stable, Briogeo and epres, both of which have earned a cult following fueled by innovation. Considered a pioneer in scalp care, Briogeo brings a line of clean, plant-based products to approximately 500 CosmoProf locations nationwide. Founded by the scientist behind Olaplex, epres brings a new line of highly innovative bonding products to BSG, providing another efficacious tool to support our stylists as they serve their clients. From a trend perspective, blonding, glossing, and express coloring remains strong as well as conscious beauty and textured hair products.

我們還在我們的穩定中添加了兩個新的引人注目的品牌：Briogeo 和 epres，這兩個品牌都因創新而贏得了狂熱的追隨者。Briogeo 被認為是頭皮護理領域的先驅，為全國約 500 家 CosmoProf 門市帶來了一系列清潔、植物性產品。由 Olaplex 背後的科學家創立，epres 為 BSG 帶來了一系列高度創新的黏合產品，為我們的造型師在為客戶服務時提供支援提供了另一種有效的工具。從趨勢的角度來看，金髮、光澤和強烈的色彩以及有意識的美容和質感護髮產品仍然很流行。

In our Sally Beauty segment, innovation is also paramount across both owned and third-party brands. Major trends include dark vivids, toners with built-in color and sustainable products which we are beginning to telegraph under a new Mindful banner.

在我們的 Sally Beauty 細分市場中，創新對於自有品牌和第三方品牌也至關重要。主要趨勢包括深色鮮豔、內建顏色​​的調色劑和永續產品，我們開始在新的 Mindful 旗幟下傳達這些趨勢。

In Q2, owned brand sales penetration for the global Sally Beauty segment was 34%, up 60 basis points over the prior year. During the second half of the year, we have additional innovation forthcoming in skin care and men's grooming.

第二季度，全球 Sally Beauty 細分市場的自有品牌銷售滲透率為 34%，較上年增長 60 個基點。今年下半年，我們將在皮膚護理和男士美容領域推出更多創新。

Our latest marketing campaign, rooted in success demonstrates our focus on creating branding moments that go beyond our Sally Beauty banner. Launched in connection with Black History Month, the campaign celebrates entrepreneurism and creativity. We'll be building on this early success and the momentum we're seeing during other key moments throughout the year, including Pride Month and Hispanic Heritage month.

我們最新的行銷活動取得了成功，這表明我們致力於創造超越 Sally Beauty 旗幟的品牌時刻。該活動是與黑人歷史月共同發起的，旨在慶祝企業家精神和創造力。我們將在這一早期成功和全年其他關鍵時刻（包括驕傲月和西班牙傳統月）所看到的勢頭的基礎上再接再厲。

Turning now to customer centricity. Let me start with a few updates on our new concepts and services. Starting with Licensed Colorist OnDemand, this service is available nationwide online and is now linked to all Sally US stores. Momentum continues to build. We saw over 3,000 consultations per week throughout Q2 with growth month over month throughout the quarter. In Q2, 40% of customers who engaged in the service were new to Sally. While it remains early days to understand the long-term benefit of the service, I'd note that for existing customers, we are seeing an uptick in visit frequency in the months following their consultation. Additionally, average ticket value increased to $35 from $33 in Q1.

現在轉向以客戶為中心。讓我先介紹一下我們的新概念和服務的一些最新情況。從 Licensed Colorist OnDemand 開始，這項服務在全國範圍內在線提供，現在已與所有 Sally US 商店相連。勢頭繼續增強。第二季度，我們每週收到超過 3,000 次諮詢，整個季度逐月成長。第二季度，參與服務的客戶中有 40% 是 Sally 的新客戶。雖然了解該服務的長期利益還處於早期階段，但我要指出的是，對於現有客戶來說，我們發現在諮詢後的幾個月內訪問頻率有所上升。此外，平均票價從第一季的 33 美元增至 35 美元。

We're also seeing strong results from our marketplace initiatives with both Amazon and Walmart performing well. Additionally, we are up and running with DoorDash as of March, and we'll launch Instacart in Q3. We view our marketplaces as an important omnichannel offering for our customers, allowing us to meet our existing customers where they are while also building awareness with new consumers.

我們也看到我們的市場計劃取得了強勁成果，亞馬遜和沃爾瑪都表現良好。此外，我們已於 3 月啟動並運行 DoorDash，並將在第三季推出 Instacart。我們將市場視為為客戶提供的重要全通路產品，使我們能夠滿足現有客戶的需求，同時提高新消費者的認知度。

Looking at Studio by Sally, we are generating key insights around format, store layout, services and education, all of which is informing new ways to engage the customer. Although we're seeing pockets of strength, results are mixed, and we need more time to evaluate our KPIs before we take definitive steps to expand the initiative. More to come on this in the quarters ahead.

看看 Studio by Sally，我們正在圍繞業態、商店佈局、服務和教育產生重要的見解，所有這些都為吸引客戶提供了新的方式。儘管我們看到了一些優勢，但結果好壞參半，在採取明確措施擴大該計劃之前，我們需要更多時間來評估我們的 KPI。未來幾季還會有更多相關內容。

Moving now to Happy Beauty Co. As we test the concept and read results, we're pleased with the performance of our initial 10 pilot stores. Traffic is continuing to build as our teams implement creative marketing strategies around social media, grassroots initiative and DIY events in stores. Gifting continues to be a strong driver, and we've been seeing that in the lead up to Mother's Day this weekend. Average ticket and units per transaction are tracking strongly, and we recently started testing a luxury closeout section on items above $10. Early uptake there is positive.

現在轉到 Happy Beauty Co。隨著我們的團隊圍繞社交媒體、草根倡議和商店 DIY 活動實施創意行銷策略，客流量持續增加。送禮仍然是一個強大的推動力，我們在本週末母親節之前就已經看到了這一點。每筆交易的平均門票和單位數量正在強勁增長，我們最近開始測試 10 美元以上商品的豪華清倉部分。早期的採用是積極的。

Based on the strength of our initial Happy Beauty rollout, we plan to open up to an additional 10 pilot stores prior to Thanksgiving in the Dallas and Phoenix market. These additional stores will further test the demographic and co-tenancy profiles that are showing strength. As part of the expanded pilot, we will also test mall locations, which we believe could be well suited for the concept given their inherent traffic and exposure to demographic profiles that are resonating in our pilot to date. Longer term, we have conviction there will be an opportunity for more accelerated expansion in fiscal 2025 and beyond.

基於我們最初推出 Happy Beauty 的實力，我們計劃感恩節前在達拉斯和菲尼克斯市場再開設 10 家試點店。這些額外的商店將進一步測試顯示實力的人口統計和共同租賃情況。作為擴大試點的一部分，我們還將測試商場地點，鑑於其固有的流量和人口統計特徵，我們認為這些地點可能非常適合這一概念，而這些地點在我們的試點中迄今為止引起了共鳴。從長遠來看，我們堅信 2025 財年及以後將有機會加速擴張。

Profitability remains a priority across the organization, and our teams are coalesced around our Fuel for Growth initiatives. We’re on track to capture previously announced pre-tax benefits of $20 million in fiscal 2024. And as shared on our last earnings call, we have identified another tranche of potential pre-tax benefit totaling approximately $50 million in fiscal 2025 with cumulative run rate benefits in fiscal 2026, approaching $120 million.

獲利能力仍然是整個組織的首要任務，我們的團隊圍繞著我們的成長動力計劃團結起來。我們預計在 2024 財年獲得先前宣布的 2,000 萬美元稅前福利。正如我們在上次財報電話會議上分享的那樣，我們已經確定了 2025 財年的另一筆潛在稅前福利總額約為 5000 萬美元，2026 財年的累計運行率福利接近 1.2 億美元。

In closing, this was a quarter with a number of learnings to build upon as we look to the future. We’re pleased to see momentum return to BSG with comparable sales in positive territory for two consecutive quarters. We believe the path to continued growth there will be driven by a combination of innovation distribution expansion and strengthening forward demand. On the Sally side, we anticipate that macro pressures will persist in the near term and remain sharply focused on controlling the controllables, which includes enhancing customer centricity through our marketplaces and Licensed Colorist OnDemand initiative.

最後，在展望未來的過程中，這個季度我們學到了許多經驗教訓。我們很高興看到 BSG 恢復勢頭，可比銷售額連續兩季保持正成長。我們相信，創新分銷擴張和未來需求增強將共同推動該地區的持續成長。在莎莉方面，我們預計宏觀壓力將在短期內持續存在，並將繼續集中精力控制可控因素，其中包括透過我們的市場和許可調色師按需計劃增強以客戶為中心的態度。

As we remain focused on delivering engaging customer experiences and executing our strategic initiatives, we are responding to the continued shift in customer dynamics with thoughtful adjustments to our promotional cadence and maintaining strict cost discipline. We greatly appreciate the ongoing support of our shareholders, and we remain committed to serving our customers and driving long-term profitable growth and value creation for all of our stakeholders.

在我們繼續專注於提供有吸引力的客戶體驗和執行我們的策略計劃的同時，我們正在透過對促銷節奏進行深思熟慮的調整併保持嚴格的成本控制來應對客戶動態的持續變化。我們非常感謝股東的持續支持，我們將繼續致力於服務客戶並為所有利害關係人推動長期獲利成長和價值創造。

Now I'll turn the call over to Marlo to discuss the financials.

現在我將把電話轉給馬洛討論財務問題。

Thank you, Denise, and good morning, everyone. Our second quarter was a dynamic one. And while we saw points of strength, our profit results came in below our expectations. Of note, sales came in at the lower end of our range, while gross margin relative to our internal expectations was our pressure point, and SG&A was in line. Let me unpack the major drivers of the quarter. First, starting with sales. We were pleased to see BSG deliver slightly ahead of expectations with the second consecutive quarter of comparable sales growth.

謝謝你，丹尼斯，大家早安。我們的第二季是一個充滿活力的季度。雖然我們看到了優勢，但我們的利潤結果低於我們的預期。值得注意的是，銷售額處於我們範圍的下限，而相對於我們內部預期的毛利率是我們的壓力點，SG&A 也符合要求。讓我來分析一下本季的主要驅動因素。首先，從銷售入手。我們很高興看到 BSG 的業績略高於預期，連續第二季的可比銷售額成長。

Turning to Sally, sales came in at the low end of our expectations. We started the quarter with about $10 million of weather impact to January. Subsequently, Sally returned to a more normalized trend line at the end of the month and into early February. Although transactions continued to improve throughout the quarter, performance at Sally US and Canada was further impacted by a decline in average unit retail prices. As Denise pointed out, we saw customers increase their take rate on promotions, and we attribute this to the inflationary environment that continues to persist.

說到莎莉，銷售額處於我們預期的低端。本季一開始，天氣對 1 月的影響約為 1,000 萬美元。隨後，莎莉在月底和二月初回到了更正常化的趨勢線。儘管整個季度的交易持續改善，但 Sally 美國和加拿大的業績受到平均單位零售價格下降的進一步影響。正如丹尼斯指出的那樣，我們看到客戶對促銷的接受率有所提高，我們將其歸因於持續存在的通貨膨脹環境。

Turning to gross margin. Although gross margin came in above our 50% target range at 51%, this was lower than we anticipated, primarily driven by a higher take rate on promotions across both business segments as our customers sought value, combined with a lower mix of our higher-margin Sally US sales.

轉向毛利率。儘管毛利率達到51%，高於我們50% 的目標範圍，但這低於我們的預期，這主要是由於我們的客戶尋求價值，導致兩個業務部門的促銷活動接受率較高，再加上我們的高端產品組合較少。

Now let me take you through the details. Second quarter consolidated net sales of $908 million declined 1.1%, while consolidated comparable sales declined 1.5%. Global e-commerce sales were $90 million and represented 10% of total net sales.

現在就讓我來帶大家詳細了解吧。第二季綜合淨銷售額為 9.08 億美元，下降 1.1%，綜合可比銷售額下降 1.5%。全球電子商務銷售額為 9,000 萬美元，佔總淨銷售額的 10%。

Looking at gross profit, we delivered solid gross margins, which came in at 51% and was flat to the prior year. Excluding last year's true-up of the non-cash inventory write-down related to the distribution center consolidation and store optimization plan that we executed last year, adjusted gross margin was 51%, an increase of 30 basis points compared to 50.7% in the prior year. Year-over-year increase reflects lower distribution and freight costs resulting from supply chain efficiencies, partially offset by a lower mix of our higher-margin Sally US sales, which I mentioned earlier.

從毛利來看，我們實現了穩健的毛利率，為 51%，與前一年持平。剔除去年我們執行的配送中心整合和門市優化計畫相關的非現金庫存減記的調整後，調整後的毛利率為 51%，比 2017 年的 50.7% 增長了 30 個基點。年比成長反映出供應鏈效率提高導致分銷和貨運成本下降，部分被我之前提到的利潤率較高的莎莉美國銷售組合的減少所抵消。

Second quarter adjusted SG&A was up $5 million versus prior year to $395 million. Year-over-year increase primarily reflects increased labor costs as well as higher rent expense, partially offset by lower accrued bonus expense.

第二季調整後的 SG&A 比去年同期增加 500 萬美元，達到 3.95 億美元。一年又一年成長主要反映了勞動成本的增加以及租金費用的增加，部分被應計獎金費用的減少所抵銷。

For the full year, we expect adjusted SG&A dollars to be up modestly versus fiscal 2023. This primarily reflects increased labor costs as well as investments in upper funnel marketing and other expenses related to our strategic growth initiatives, partially offset by the favorable impact of our fuel for growth initiatives. As a reminder, we expect to realize $20 million of pre-tax benefits to gross margin and SG&A that is weighted more heavily towards the second half of fiscal 2024. For perspective, approximately 75% of the benefits will be realized in SG&A.

就全年而言，我們預計調整後的 SG&A 美元將比 2023 財年小幅成長。這主要反映了勞動力成本的增加以及對上漏斗行銷的投資以及與我們的策略成長計劃相關的其他費用，但部分被我們的成長計劃燃料的有利影響所抵消。提醒一下，我們預計在 2024 財年下半年實現 2,000 萬美元的毛利率和 SG&A 稅前效益，其中比重更大。從長遠來看，大約 75% 的收益將在 SG&A 中實現。

We expect to incur pre-tax cash charges associated with the Fuel for Growth program in the range of $25 million to $30 million in the current fiscal year, including $14 million that has been realized year-to-date. Additionally, we are working with external partners on additional opportunities and expect to approach $120 million in cumulative run rate benefits by the end of fiscal 2026.

我們預計本財年將產生與成長燃料計畫相關的稅前現金費用在 2,500 萬至 3,000 萬美元之間，其中包括今年迄今已實現的 1,400 萬美元。此外，我們正在與外部合作夥伴合作尋找更多機會，預計到 2026 財年底，累計運行率效益將接近 1.2 億美元。

Turning now to earnings. Adjusted operating margin came in at 7.6%. Adjusted EBITDA margin was 11% and adjusted diluted earnings per share was $0.35. Moving to segment results. Sally Beauty comparable sales declined 4%, while net sales were down 3%, reflecting the factors I outlined earlier, including the January weather impact and ongoing frugality against the macro backdrop. At constant currency, Sally e-commerce sales were $34 million and represented 7% of segment net sales for the quarter.

現在轉向收益。調整後營業利益率為 7.6%。調整後 EBITDA 利潤率為 11%，調整後稀釋每股收益為 0.35 美元。轉向細分結果。Sally Beauty 可比銷售額下降 4%，淨銷售額下降 3%，反映了我之前概述的因素，包括 1 月份天氣影響和宏觀背景下持續的節儉政策。以固定匯率計算，Sally 電子商務銷售額為 3,400 萬美元，佔該季度部門淨銷售額的 7%。

For the Global Sally Beauty segment, color was down 4% and care was up 1%. At Sally US and Canada, color was down 6% and care was down 1%. Of note in Q2, we generated 79% of our Sally US and Canada sales from our 16 million loyalty members. Gross margin in our Sally segment was 59.9%, up 10 basis points to last year, reflecting supply chain efficiencies, partially offset by last year's true-up of the non-cash inventory write-down related to the distribution center consolidation and store optimization plan.

對於全球 Sally Beauty 細分市場，彩妝業務下降 ​​4%，護理業務成長 1%。在 Sally 美國和加拿大，色彩下降了 6%，護理下降了 1%。值得注意的是，在第二季度，我們的 Sally 美國和加拿大銷售額的 79% 來自我們的 1,600 萬忠誠會員。Sally 部門的毛利率為 59.9%，比去年增長 10 個基點，反映了供應鏈效率，但部分被去年與配送中心整合和商店優化計劃相關的非現金庫存減記調整所抵消。

Segment operating margin came in at 15%. Moving to the BSG segment, the combination of product innovation, expanded distribution, and strengthening salon demand trends drove strong performance in the quarter. Comparable sales and net sales were both up 2%. On a constant currency basis, BSG e-commerce sales were $56 million, representing 14% of segment net sales for the quarter. The color category was up 6% and care was up 3%. Gross margin at BSG increased 50 basis points to 39.4%, reflecting supply chain efficiencies, partially offset by lower product margin, which was driven mostly by higher take rate on promotions and brand mix. Segment operating margin was 10.9%.

部門營業利益率為 15%。轉向 BSG 領域，產品創新、擴大分銷和加強沙龍需求趨勢相結合，推動了本季的強勁業績。可比銷售額和淨銷售額均成長 2%。以固定匯率計算，BSG 電子商務銷售額為 5,600 萬美元，佔該季度部門淨銷售額的 14%。顏色類別上漲了 6%，護理類別上漲了 3%。BSG 的毛利率成長了50 個基點，達到39.4%，反映出供應鏈效率的提高，但產品利潤率下降部分抵消了產品利潤率下降的影響，而產品利潤率下降主要是由於促銷和品牌組合的採用率提高所致。分部營業利益率為 10.9%。

Turning to the balance sheet and cash flow. We ended the second quarter with $97 million of cash and cash equivalents and $62 million outstanding under our asset-based revolving line of credit. Our net debt leverage ratio stood at 2.2 times. Importantly, during the quarter, we were able to take advantage of an opportunity to further optimize our balance sheet by issuing a new $600 million 8-year senior unsecured notes due 2032.

轉向資產負債表和現金流量。第二季結束時，我們的以資產為基礎的循環信貸額度下有 9,700 萬美元的現金和現金等價物以及 6,200 萬美元的未償餘額。我們的淨負債槓桿率為2.2倍。重要的是，在本季度，我們能夠利用這個機會，發行 2032 年到期的新的 6 億美元 8 年期高級無抵押票據，進一步優化我們的資產負債表。

The net proceeds from the transaction in combination with existing cash and a modest draw under our asset-based revolving line of credit were used to refinance our $680 million 5.58% senior unsecured notes due 2025. A new senior unsecured note was issued with a coupon rate of 6.75%. The lower principal amount of the new note will help offset the majority of the interest expense from the higher coupon rate.

該交易的淨收益與現有現金以及我們基於資產的循環信貸額度下的適度提款相結合，用於為 2025 年到期的 6.8 億美元、利率為 5.58% 的高級無擔保票據進行再融資。新發行優先無抵押票據，票面利率為6.75%。新票據本金較低將有助於抵銷較高票面利率帶來的大部分利息支出。

Quarter end inventory was up 1.6% to slightly over $1 billion, which is in line with our expectations and reflects a healthy overall position, including good in-stock levels. We generated positive cash flow from operations of $37 million allowing us to repurchase another 1.5 million shares at an aggregate cost of $20 million this quarter under our share repurchase plan.

季末庫存成長 1.6%，略高於 10 億美元，符合我們的預期，反映了健康的整體狀況，包括良好的庫存水準。我們從營運中產生了 3,700 萬美元的正現金流，使我們能夠根據股票回購計畫在本季以總成本 2,000 萬美元回購另外 150 萬股股票。

Turning now to guidance. We are revising our full year operating margin outlook to reflect our second quarter results. We continue to expect full year net sales and comparable sales to be approximately flat. As a reminder, for the second half of the year, we expect BSG to benefit from continued momentum in new brand innovation and expanded distribution opportunities as well as easier compares from lapping of hair care headwinds from the last several quarters.

現在轉向指導。我們正在修改全年營業利潤率預期，以反映我們第二季的業績。我們仍然預計全年淨銷售額和可比銷售額將大致持平。提醒一下，今年下半年，我們預計 BSG 將受益於新品牌創新的持續勢頭和擴大的分銷機會，以及過去幾季護髮行業逆風的影響。

Additionally, at Sally, we expect incremental improvement on the top line to be driven by the ramp of Walmart marketplace as well as the addition of Instacart and DoorDash. The expansion of Licensed Colorist OnDemand and benefits in Europe from pricing and new brand launches. Given the dynamics from our second quarter results, we are sharpening our guidance on gross margin and now expect the full year gross margin rate to be in the range of 50.5% to 51%. We now expect adjusted operating margin of approximately 8.5%. Accordingly, we are also revising our operating cash flow outlook to approximately $240 million.

此外，在 Sally，我們預計沃爾瑪市場的成長以及 Instacart 和 DoorDash 的加入將推動營收的逐步改善。Licensed Colorist OnDemand 的擴張以及在歐洲的受益於定價和新品牌的推出。鑑於第二季業績的動態，我們正在加強對毛利率的指導，目前預計全年毛利率將在 50.5% 至 51% 的範圍內。我們目前預計調整後營業利潤率約為 8.5%。因此，我們也將營運現金流前景修改為約 2.4 億美元。

Lastly, capital expenditures are still planned to be approximately $100 million. Looking at the third quarter, we expect net sales and comparable sales to be in the range of down 1% to up 1%. We expect the gross margin rate in Q3 to be down slightly from Q2, driven in large part by the Q2 factors I discussed earlier around higher take rate on promotions and overall sales mix.

最後，資本支出仍計劃約為 1 億美元。展望第三季度，我們預計淨銷售額和可比銷售額將下降 1% 至成長 1%。我們預計第三季的毛利率將比第二季略有下降，這在很大程度上是受到我之前討論的有關促銷和整體銷售組合較高的接受率的第二季度因素的推動。

Third quarter adjusted SG&A dollars are expected to be approximately flat compared to our second quarter. Incremental investments in marketing will be offset by the savings from our Fuel for Growth program as expected. Additionally, we anticipate the third quarter adjusted operating margin will be in the range of 8% to 8.5%. Lastly, we expect investments in share repurchases in the third quarter to be approximately $10 million.

與第二季相比，第三季調整後的銷售、管理及行政費用預計將大致持平。行銷方面的增量投資將被我們的成長燃料計畫所節省的費用所抵消，正如預期的那樣。此外，我們預計第三季調整後營業利潤率將在 8% 至 8.5% 之間。最後，我們預計第三季股票回購投資約 1,000 萬美元。

We appreciate your time this morning. Now I’ll ask the operator to open the call for Q&A.

我們非常感謝您今天早上的寶貴時間。現在我將要求接線員打開電話進行問答。

(Operator Instructions) Korinne Wolfmeyer, Piper Sandler.

（操作說明）Korinne Wolfmeyer、Piper Sandler。

This is Sarah, on for Korinne. Could you talk a bit about what you’re seeing in terms of stylist sentiment and if you’re still finding stylists shopping closer to their need versus holding more inventory or if that’s improving at all? And then with those recently added brands to BSG, how are you thinking about which brands you’re reducing shelf space for to bring those new brands on.

我是莎拉，替科琳代言。您能否談談您在造型師情緒方面所看到的情況，以及您是否仍然發現造型師會更接近他們的需求而不是持有更多庫存，或者情況是否有所改善？然後，對於最近添加到 BSG 的品牌，您如何考慮要減少哪些品牌的貨架空間以引入這些新品牌。

Yes. Happy to talk about that. We were extremely pleased to see continued stylist trends improve in Q2 and the strength of our BSG business overall, posting a positive comp. As you mentioned, both stylists’ sentiment and our innovation and territory expansion were contributions to that.

是的。很高興談論這個。我們非常高興地看到第二季度造型師趨勢持續改善，以及我們 BSG 業務的整體實力，並取得了積極的業績。正如您所提到的，造型師的情感以及我們的創新和領土擴張都對此做出了貢獻。

So on the stylist’s sentiment side, we’re still seeing stylists to buy closer to need. With an exception this past quarter, where when there was a discounting opportunity like with our customer appreciation sale, we actually saw better stylist response to that than we had in the past, which suggests to us that search for value on the part of the stylist is the most predominant behavior right now. So certainly not stocking up for just preparing for the future, but we’ll take advantage of those deals when those deals come forward. But we’re pleased to hear from our stylists that their chairs are relatively busy and returning to a bit of a normal cadence.

因此，在造型師的情緒方面，我們仍然看到造型師會根據需求進行購買。除了上個季度的例外，當有折扣機會（例如我們的客戶感謝促銷）時，我們實際上看到造型師對此的反應比過去更好，這表明我們要尋找造型師的價值是目前最主要的行為。因此，當然不是為了為未來做準備而儲備庫存，但當這些交易出現時，我們將利用這些交易。但我們很高興從造型師那裡得知，他們的椅子相對繁忙，並且恢復了正常的節奏。

If you think about it, the customers for those stylists are middle-to-higher income customers that are back on some of their core routines. When we look at BSG brands, the brands that we're bringing in and don't materially change the shelf space of any of our existing brands or existing products. You will trim a few SKUs from the assortment here and there, but no material changes in the reduction of an actual line.

如果你仔細想想，這些造型師的客戶都是中高收入客戶，他們已經恢復了一些核心習慣。當我們考慮 BSG 品牌時，我們引入的品牌不會實質改變我們任何現有品牌或現有產品的貨架空間。您將從各處的品種中削減一些 SKU，但實際產品線的減少不會發生重大變化。

But with Moroccan oil and Amika and Color Wow, clearly, those three entries were big ones for us. And then most recently, Briogeo and epres are nice additions, but they are limited SKU counts and can fit into our store assortment nicely.

但對於摩洛哥石油、Amika 和 Color Wow，顯然這三個條目對我們來說意義重大。最近，Briogeo 和 epres 都是不錯的補充，但它們的 SKU 數量有限，可以很好地融入我們的商店品種。

Very helpful. Thank you.

很有幫助。謝謝。

Oliver Chen, Cowen.

奧利佛·陳，考恩。

Would love your color on the difference in demand in terms of improving salons, but consumer spend at SBS being softer. And then also, how are you managing promotions as consumers remain cautious. What do you think about promotes in the back half? And then also as we think about the softer 2Q margins, at any other underlying driver for lower operating income margin guidance while you’re reiterating the top line would be helpful as well. Thank you.

我會喜歡你在改善沙龍方面的需求差異的顏色，但消費者在 SBS 的支出較為疲軟。另外，在消費者保持謹慎的情況下，您如何管理促銷活動。您對後半段的促銷有何看法？然後，當我們考慮第二季利潤率疲軟時，在您重申營收的同時，任何其他導致營業收入利潤率指引降低的潛在驅動因素也會有所幫助。謝謝。

Great. I’ll cover, Oliver, on both demand and promotions and then pass it to Marlo to talk a little bit more about margins and guidance. When we think about demand, we’re really seeing a bifurcation of two different consumer populations. What we’re seeing with stylists who predominantly serve a middle-to-higher income customer is a return of regular, more normalized services and cadence come through. And we’re seeing that with both strength in color and care coming through our sales portfolio.

偉大的。奧利弗，我將介紹需求和促銷活動，然後將其傳遞給馬洛，以便更多地討論利潤和指導。當我們考慮需求時，我們確實看到了兩個不同消費者群體的分歧。我們看到，主要為中高收入客戶服務的造型師正在回歸常規、更標準化的服務和節奏。我們透過我們的銷售組合看到了色彩和護理方面的實力。

I think when you contrast that with the lower income consumer, that’s a more typical Sally consumer, is they’re feeling more pressure, right? We see it as people come through and are selective in their baskets fueling the just general price inflation, food inflation, not going down in the way people would have hoped.

我認為，當你將其與低收入消費者（即更典型的莎莉消費者）進行比較時，他們是否感受到了更大的壓力，對吧？我們認為這是因為人們經歷了困難並在他們的籃子中進行了選擇性的刺激，從而加劇了總體價格通膨，食品通膨，而不是像人們希望的那樣下降。

And then your Buy Now Pay Later balances, credit card balances starting to make people make a few more choices. The good news is relatively resilient in what we believe is we maintain unit share in color in the category, but the category itself was pressured. So we’re expecting that some of that consumer pressure on the Sally side will persist. But working to navigate through it and still provide good value to our customers, but notably focusing on experiences like Licensed Colorist OnDemand in our marketplaces that provide reason beyond a deal to be shopping with us and having an experience with Sally.

然後你的「先買後付」餘額、信用卡餘額開始讓人們做出更多選擇。好消息是相對有彈性，我們認為我們保持了該類別中顏色的單位份額，但該類別本身受到了壓力。因此，我們預期莎莉方面的部分消費者壓力將持續存在。但努力克服它並仍然為我們的客戶提供良好的價值，但特別關注我們市場中的 Licensed Colorist OnDemand 等體驗，這些體驗為與我們一起購物和與 Sally 體驗的交易提供了超越交易的理由。

And to that end, you asked about promotions. It was a quarter where we saw that take rate on promotions on both the pro and the retail side increase. So the nature of everyone searching for an extra layer of value certainly came through. As we watch that happened through the quarter, we quickly started to mobilize the analytics on where we could shift to the design of some promotion the absolute depth of promotion, the duration of promotion.

為此，您詢問了晉升事宜。在這個季度，我們看到專業和零售的促銷活動率都有所增加。因此，每個人都尋求額外價值的本質肯定體現了出來。當我們看到整個季度發生的情況時，我們很快就開始進行分析，以了解我們可以在哪些方面轉向某些促銷的設計、促銷的絕對深度、促銷的持續時間。

And you’ll see some of those changes come through as we work through the second half of the year. We’re really balancing a depth of understanding of how shoppers are putting product in their basket to be able to maintain that share of wallet, while hopefully trimming a bit about AUR pressure that we saw just from that higher promo penetration. That is true on both the BSG and the Sally side in terms of the work we have going on. So we expect to see that trend to moderate a bit as we make these changes, but we’re going to be very live with our choices to maintain that customer loyalty and share of wallet.

當我們在今年下半年開展工作時，您將看到其中一些變化的發生。我們真正平衡了對購物者如何將產品放入購物籃的深度理解，以便能夠保持錢包份額，同時希望減輕我們從較高的促銷滲透率中看到的 AUR 壓力。就我們正在進行的工作而言，BSG 和 Sally 方面都是如此。因此，當我們做出這些改變時，我們預計這種趨勢會有所緩和，但我們將非常支持我們的選擇，以保持客戶忠誠度和錢包份額。

And I'll turn it over to Marlo to comment a bit on margins.

我會把它交給 Marlo，讓他對利潤率做一些評論。

Yes, in terms of our margin update. Really, that was driven predominantly from the adjustments we made to our gross margins. Our gross margins for Q2 came in at 51%, very solid we had the benefits of our supply chain efficiencies. We did have some offset from the lower mix of the higher-margin Sally US business being a lower penetration. But overall, it was a bit lower than our expectations, not significantly, but modestly where we thought based on that performance, that it was prudent to take down our gross margin expectations for the remainder of the year.

是的，就我們的保證金更新而言。事實上，這主要是由於我們對毛利率的調整。我們第二季的毛利率為 51%，我們從供應鏈效率中獲益良多。我們確實從利潤率較高的莎莉美國業務的較低組合中得到了一定的抵消，因為滲透率較低。但總體而言，它比我們的預期略低，雖然不是顯著，但略低於我們的預期，我們認為根據這一業績，降低今年剩餘時間的毛利率預期是謹慎的。

So we’re guiding to a 50.5% to 51% range, and that’s what translated through to the lowering of the operating margin. That range is still historically high. It has a very strong margin. We’re very pleased with that margin. But as we learn more about the shift in customer behavior and the adjustments we’re making to our promotional cadence, we just thought it was prudent to make that adjustment.

因此，我們的指導範圍是 50.5% 到 51%，這導致了營業利潤率的降低。該範圍仍處於歷史高點。它有非常強大的利潤。我們對這項利潤率感到非常滿意。但當我們更了解客戶行為的轉變以及我們對促銷節奏所做的調整時，我們認為進行這種調整是謹慎的。

Okay. Very helpful. Just a follow-up. As you think about upper funnel investing in marketing, it sounds like a great idea. What do you think about how this may be different from prior? And then finally, on the comps and as we think about the back half, what are some underlying factors that give you confidence that they’ll turn positive? Thanks so much, Denise and Marlo.

好的。很有幫助。只是後續行動。當您考慮行銷上漏斗投資時，這聽起來是個好主意。您認為這與之前有何不同？最後，在比較方面，當我們考慮後半部時，有哪些潛在因素讓您有信心它們會轉為正面？非常感謝，丹尼斯和馬洛。

Yes. So how about I take those in reverse order. So I think when we think about the second half of the year, there’s two predominant sets of trends going on. When we look at BSG, we do think the continued momentum in the new brand innovation is real and will continue to benefit. We also see expanded distribution opportunities continuing and that will be there.

是的。那麼我以相反的順序來處理這些呢？因此，我認為，當我們考慮今年下半年時，會出現兩個主要趨勢。當我們審視 BSG 時，我們確實認為新品牌創新的持續動力是真實的，並將繼續受益。我們也看到擴大的分銷機會仍在繼續，並且將會存在。

Underlying that, BSG is also lapping the hair care headwind we had from a big brand in early Q2. So that’s going to lead to some easier compares in the second half of the year, so BSG continuing on a nice solid trajectory. And on the Sally side, as we turn to the second half of the year, we do see marketplaces, Licensed Colorist OnDemand, product innovation, own brands, all combined with CRM and some personalization activities as things that will provide a lift there as well.

在此基礎上，BSG 也正在應對我們在第二季初從一個大品牌獲得的護髮逆風。因此，這將導致下半年的一些比較容易進行，因此 BSG 繼續保持良好的穩定發展軌跡。在Sally 方面，當我們轉向今年下半年時，我們確實看到市場、授權調色師按需、產品創新、自有品牌，所有這些都與CRM 和一些個人化活動相結合，這些都將帶來提振。

So our strategic initiative’s continuing to pay off, even though we’ll have that undercurrent of a little bit more macro pressure. I think when we combine all of those with the fuel for growth activity and the savings that we’ll have coming through in the second half of the year, we feel pretty confident about the guidance and the guidance update that we provided today.

因此，我們的策略性舉措將繼續獲得回報，儘管我們將面臨更多宏觀壓力的暗流。我認為，當我們將所有這些與成長活動的動力和下半年將實現的節省結合起來時，我們對今天提供的指導和指導更新充滿信心。

When we look at marketing, if I go back to your first question, marketing is a very interesting space for us in how we both serve our existing customers and attract new customers. And some of the things we're trying to do are use upper funnel marketing to take people more to something like a Licensed Colorist OnDemand, right? So how can we use social media, how can we use performance marketing to direct people to an experience that will bring a new customer into Sally.

當我們審視行銷時，如果我回到你的第一個問題，行銷對我們來說是一個非常有趣的領域，因為我們如何服務現有客戶並吸引新客戶。我們正在嘗試做的一些事情是利用上層漏斗行銷來引導人們更多地接觸許可調色師點播之類的東西，對吧？那麼我們如何使用社群媒體，如何使用績效行銷來引導人們獲得一種體驗，從而為 Sally 帶來新客戶。

And when we think about that Licensed Colorist OnDemand and the results of having pushed that initiative this past quarter, which we saw 40% of the customers who participated in that were new to Sally. We've started to see a little bit of increase in frequency in the month after those customers experienced that.

當我們考慮 Licensed Colorist OnDemand 以及上個季度推動該計劃的結果時，我們發現參與該計劃的客戶中有 40% 對 Sally 來說是新客戶。在這些客戶經歷過這種情況後的一個月裡，我們開始看到頻率增加。

So marketing really tailored to say what’s different about Sally and why Sally can make a difference to you is what we’re focused on as we’re headed towards the back half of the year. We also are pleased we’re about six months into having a new performance marketing agency supporting us and see that a lot of the work they’re doing to best target our efforts is going to pay off as well.

因此，我們在今年下半年的重點工作是進行真正量身定制的行銷活動，以說明 Sally 的不同之處以及 Sally 為何能夠為您帶來改變。我們也很高興我們已經有一家新的績效行銷機構為我們提供支持，大約六個月後，我們看到他們為最好地瞄準我們的努力所做的大量工作也將得到回報。

And I guess the last piece there is, we’re also purposefully doubling down on a bit of a test into nine of our markets where we think we have a share of wallet opportunity and understanding that if we put a little bit more fuel behind communications and messages in those markets. What can we do to see that push the needle a little bit more and hopefully convert a few more customers and drive a bit more frequency. So a number of pieces and parts there, but really trying to stay true to what’s unique about Sally and pushing experiences, product offering, expertise in those communications.

我想最後一點是，我們還特意加倍努力，對我們的九個市場進行了一些測試，我們認為我們在這些市場中擁有份額的錢包機會，並且了解如果我們多投入一點燃料這些市場中的通信和消息。我們可以做些什麼來進一步推動這一點，並希望轉換更多的客戶並提高頻率。因此，其中有很多部分，但真正努力保持莎莉的獨特之處，並推動體驗、產品供應和這些溝通方面的專業知識。

Thanks very much. Appreciate it.

非常感謝。欣賞它。

Olivia Tong, Raymond James.

唐奧立，雷蒙德詹姆斯。

A few questions here. First, on the Sally Beauty Stores, what did you see as you exited the quarter? Maybe talk through some of the initiatives to spur foot traffic? On the BSG side, can you help us understand how much of the territory expansion added to sales and whether there's any pipeline fill doesn't repeat.

這裡有幾個問題。首先，在莎莉美容店，當您離開本季時看到了什麼？或許談談一些刺激人流的舉措？在 BSG 方面，您能否幫助我們了解領土擴張增加了多少銷售額以及是否有管道填充不重複。

And then just last question is on operating margin, a point of clarification. I understand the margin guide change as a result of the mix shift that impacted Q2 and likely impact the second half, but are you adjusting second half expectations for margins by segment? And if not, can you talk about what's going to be the offset to keep second half margin targets unchanged if you want to have a little bit more flexibility on adjusted promotion. Thank you so much.

最後一個問題是關於營業利潤率，需要澄清一點。據我了解，由於混合變化影響了第二季度，並可能影響下半年，利潤率指南發生了變化，但您是否正在按部門調整下半年對利潤率的預期？如果沒有，如果您想在調整後的促銷方面有更多的靈活性，您能否談談保持下半年利潤目標不變的抵消額是多少。太感謝了。

Happy to take those. We'll try to take them in order. Sally, when we think about driving traffic to the stores and driving transactions overall, I think we're thinking about it very holistically in a very omni-channel. So as we look to the second half of the year and we look to the end of our second quarter, marketplaces ramped up for us. So we were able to add in DoorDash to our mix, along with Walmart and Amazon and saw nice early results there. Instacart is getting turned on in the beginning of Q3. That's nice traffic. It's traffic that actually goes through our stores.

很高興接受這些。我們會盡力按順序處理它們。莎莉，當我們考慮增加商店客流量並推動整體交易時，我認為我們是在一個非常全面的管道中非常全面地考慮它。因此，當我們展望今年下半年和第二季末時，市場對我們來說正在增加。因此，我們能夠將 DoorDash 與沃爾瑪和亞馬遜一起添加到我們的組合中，並在那裡看到了不錯的早期結果。Instacart 在第三季初開始上線。這交通真好啊這是實際流經我們商店的流量。

As you know, as those will get shopped in the stores, particularly for the DoorDash and Instacart piece and delivered to the customer, when we look beyond that, things that are generating those experiences and those reasons to shop with us were performing well at the end of the quarter. So as I mentioned earlier, Licensed Colorist OnDemand, our own brands and bond bar that are driving new customers into our store and building that loyalty piece as well. And then our CRM activities as we continue to get more targeted and more personalized for the reason for somebody to come back and shop with Sally, so looking at it a very omnichannel way.

如您所知，由於這些商品將在商店中購買，特別是 DoorDash 和 Instacart 商品並交付給客戶，當我們超越這一點時，產生這些體驗的事物以及在我們這裡購物的原因在商店中表現良好季度末。正如我之前提到的，Licensed Colorist OnDemand、我們自己的品牌和 Bond Bar 正在吸引新客戶進入我們的商店，並建立忠誠度。然後我們的 CRM 活動，因為我們繼續變得更有針對性和更加個性化，因為有人會回來和 Sally 一起購物，所以以一種非常全渠道的方式來看待它。

And then when a customer gets into the store, that store associate being knowledgeable, having the information that they need to really drive conversion. And we have seen a modest uptick in conversion as we have come through the quarter as well. So trying to capitalize on all fronts there as we also look to say a customer is shopping with a bit of frugality. And so pleased with what we are working on and the traction that we are starting to get and think that that will bear more fruit as we come into the second half of the year.

然後，當顧客進入商店時，店員知識淵博，擁有真正推動轉換所需的資訊。在整個季度中，我們也看到轉換率略有上升。因此，我們試圖充分利用各個方面，因為我們也希望顧客在購物時節儉一點。我們對我們正在進行的工作以及我們開始獲得的關注感到非常滿意，並認為隨著下半年的到來，這將結出更多成果。

On the BSG front, in terms of what’s contributing to the upside, it’s a broad-based set of things, right, that span from innovation gains, new innovation gains, distribution gains, and we have also talked a little bit about the stylist demand. We haven’t broken out those individual component pieces beyond talking about the Goldwell New York acquisition that we are kick-starting Q4, so it still has another couple of quarters to run there. I believe that that was – it’s $10 million to $15 million in top-line sales that will be on an annualized basis.

在 BSG 方面，就推動上行的因素而言，這是一系列廣泛基礎的因素，包括創新收益、新創新收益、分配收益，我們也討論了一些關於造型師的需求。除了談論我們正在第四季度啟動的 Goldwell New York 收購之外，我們還沒有分解這些單獨的組成部分，因此它還需要幾個季度的運行。我相信，以年計算，總銷售額將達到 1,000 萬至 1,500 萬美元。

All the other pieces we really believe are in the run rate and that is these items start to lap. We do have continued innovation in the pipeline behind them. So Amika and Moroccan oil and Color Wow, great strength today, and we think there is more to come. But adding in things like Briogeo and epres, we just want to continue that flywheel of innovation coming into the BSG ecosystem.

我們真正相信的所有其他部件都在運行率中，這意味著這些部件開始磨損。我們確實在背後不斷進行創新。所以阿米卡和摩洛哥油和顏色哇，今天的力量很大，我們認為未來還會有更多。但加上 Briogeo 和 epres 等東西，我們只是想繼續將創新飛輪帶入 BSG 生態系統。

And Marlo, do you want to talk a little bit about the margin guide?

Marlo，你想談談保證金指南嗎？

Yes, the margin guide in terms of -- I think your question was directed at the segment. So a key component is the mix shift that we saw in Q2, and we expect that to continue again with the solid momentum around BSG and a little bit of softness in Sally, mainly from that AUR pressure. And then the gross margin guide, as we mentioned, again, being a little more prudent there as we continue to work through our adjustments to our promotional offerings as we try to continue to drive traffic and gain share of wallet.

是的，關於保證金指南——我認為您的問題是針對該細分市場的。因此，一個關鍵組成部分是我們在第二季度看到的混合轉變，我們預計這種情況將再次持續下去，BSG 周圍的強勁勢頭和 Sally 的一點疲軟（主要來自 AUR 壓力）。然後，正如我們再次提到的，毛利率指南變得更加謹慎，因為我們繼續對促銷產品進行調整，同時我們試圖繼續增加流量並獲得錢包份額。

Ashley Helgans, Jefferies.

阿什利·赫爾根斯，杰弗里斯。

To start, maybe you can just give us a little bit more color on the specifics around the innovation that you saw this quarter that really helped drive the strength at BSG. And then any innovation that you are seeing within Sally would be helpful. And then I know you mentioned like promotions and people shifting towards buying more on promotion. But anything you can tell about just the promotional rate this quarter versus last year would be great.

首先，也許您可以向我們介紹您本季看到的創新的具體細節，這些創新確實有助於推動 BSG 的實力。然後你在莎莉身上看到的任何創新都會有所幫助。然後我知道你提到了促銷活動以及人們轉向在促銷活動中購買更多商品。但如果你能透露本季與去年相比的促銷率，那就太好了。

So let me take those in reverse order. So promotional rate this year versus last year, no meaningful difference in the offers that we had out there on the Sally side, BSG probably had a slight bit more promotion, but we have been seeing that with our vendors leaning in over the last few quarters. But in the Sally World, offers were out there, they were just being more consistently pursued by our customer base. And in BSG, the most notable was our customers leaning in against the customer appreciation sale, which is a once a quarter event that we do. But to put it in proportion, this quarter versus the quarter a year ago, the same two-day customer appreciation sale, our sales were up 17%. So really leaning in and looking for that value is what came through, but the offers themselves very, very similar year over year.

那麼就讓我以相反的順序來看這些。因此，今年的促銷率與去年相比，我們在 Sally 方面提供的優惠沒有顯著差異，BSG 可能有更多的促銷，但我們已經看到我們的供應商在過去幾個季度中有所傾斜。但在莎莉世界，優惠就在那裡，只是我們的客戶群更一致地追求它們。在 BSG，最值得注意的是我們的客戶傾向於客戶答謝促銷，這是我們每季舉辦一次的活動。但以比例來說，這個季度與去年同期相比，同樣是兩天的客戶答謝促銷，我們的銷售額成長了17%。因此，真正投入並尋找這種價值就是我們所經歷的，但這些產品本身每年都非常非常相似。

On the innovation front, as I have said, we are extremely excited about the innovation cycle we are in and what we can bring in. And when you think about the drivers of the innovation on the BSG side, certainly continue to have some strength from core brands like Wella that we are bringing out new innovation. But a lot of the strength came from Moroccan oil, Color Wow, Amika. In some cases, that was expanding territory rights in some of those brands.

在創新方面，正如我所說，我們對我們所處的創新週期以及我們能夠帶來的東西感到非常興奮。當您考慮 BSG 方面的創新驅動力時，肯定會繼續從像 Wella 這樣的核心品牌中獲得一些優勢，我們正在推出新的創新。但很多力量來自摩洛哥油、Color Wow、Amika。在某些情況下，這是擴大其中一些品牌的領土權。

And in other cases, it was expanding to our entire store fleet and then cycling behind that a new level of innovation with the launch of Briogeo as well as epres. All of these are hair care products that are on the styling side, on the core care side, they just offer new and different alternatives for our stylists as they think about serving their customers and their clients, some of which are bonding, some of which are other functional solutions, but all of which are really resonating through our customer base.

在其他情況下，它擴展到我們的整個商店隊伍，然後隨著 Briogeo 和 epres 的推出，將創新水平推向新的水平。所有這些都是在造型方面、在核心護理方面的護髮產品，它們只是為我們的造型師提供了新的和不同的選擇，因為他們考慮為他們的客戶和他們的客戶提供服務，其中一些是黏合的，其中一些是是其他功能性解決方案，但所有這些都真正引起了我們客戶群的共鳴。

On the Sally side, we continue to look favorably to opportunities around our Mindful brands. So things that are more conscious beauty choices are inspired by nature products performed well. We continue to see bond bar perform well and grow from our own brands perspective.

在 Sally 方面，我們繼續看好 Mindful 品牌的機會。所以更多有意識的美容選擇都是受到大自然產品表現良好的啟發。從我們自己的品牌角度來看，我們繼續看到債券金條表現良好並且持續成長。

And then we see interest remains in vivid color, it was about 22% of our penetration in the quarter. So that has also leveled off in those low-20s, but there is still a nice pipeline there. The innovation to come in Sally is exciting around some things that we are doing on skin care, continue leaning into textured care that will all come as we are entering the second half of the year. So great pipeline on both sides of the business that we actually think are fantastic offerings for our customers.

然後我們看到人們對鮮豔色彩的興趣仍然存在，約占我們本季滲透率的 22%。因此，在 20 歲以下的人群中，這種情況也趨於平穩，但那裡仍然有一個不錯的管道。莎莉的創新令人興奮，圍繞著我們在皮膚護理方面所做的一些事情，繼續傾向於質感護理，這一切都將在我們進入下半年時實現。業務雙方的管道如此之長，我們實際上認為這對我們的客戶來說是很棒的產品。

Great. Thanks for all the color.

偉大的。感謝所有的顏色。

Jenna Giannelli, Morgan Stanley.

珍娜‧賈內利，摩根士丹利。

This is Sarah, on for Jenna. Can you update us on your capital allocation priorities if your leverage target of 1.5 to 2 times still holds and how you are balancing that with repurchases? Thanks.

這是莎拉，替詹娜發言。如果您的槓桿目標仍保持在 1.5 至 2 倍，您能否向我們介紹您的資本配置優先順序以及您如何平衡這一目標與回購？謝謝。

Thank you. So our leverage range of the 1.5 times to 2 times, we do believe that's appropriate for our business going forward. So we will continue to work towards that. This quarter, we were pleased to be able to further optimize our balance sheet with the recent refinancing. We did take $80 million of principal out of that secured note as we refinance into a new secured note. Just given the timing of our cash flow, we are generally much heavier in the back half and certainly in Q4 in terms of our free cash flow generation.

謝謝。因此，我們的槓桿範圍為 1.5 倍到 2 倍，我們確實相信這適合我們未來的業務。因此，我們將繼續為此努力。本季度，我們很高興能夠透過最近的再融資進一步優化我們的資產負債表。當我們再融資為新的擔保票據時，我們確實從該擔保票據中取出了 8000 萬美元的本金。考慮到我們現金流的時間安排，就我們的自由現金流產生而言，我們通常在後半段，尤其是第四季度，要重得多。

So we did use our ABL to help complete that refinancing. We have got about $60 million outstanding on that ABL. So we will continue to balance debt pay-down and share repurchase. But we do look to get out of that ABL as we progress through the coming quarters and as we get into our heavier cash generation quarters. But we will take a balanced approach as you heard us comment, we are guiding to about a $10 million share repurchase for Q3.

因此，我們確實使用 ABL 來幫助完成再融資。我們在該 ABL 上還有大約 6000 萬美元的未償付。因此，我們將繼續平衡債務償還和股票回購。但隨著我們在未來幾季的進展以及進入現金產生量較大的季度，我們確實希望擺脫 ABL。但我們將採取平衡的方法，正如您聽到我們評論的那樣，我們計劃在第三季回購約 1000 萬美元的股票。

Great. Thanks. And then just a follow-up, can you speak to the extent to which the weakness on higher ticket items continues to weigh on sales and when we might start to comp out of that?

偉大的。謝謝。接下來，您能否談談高價商品的疲軟在多大程度上繼續影響銷售，以及我們什麼時候可以開始彌補這一點？

Yes. The way that I would think about it is we guided Q3 sales down one to plus one. So in general, progress in returning to the total business headed towards a positive comp. So as I mentioned earlier, our focus as we saw the uptake in promotion through Q2 take hold was really to think about our planning for Q3 and Q4. Those actions and changes are underway now as we are engaging with our customer and providing them with offers. So progressively see comps improving as we go into Q3 and getting us back into flat performance, which is what we expect for the full year.

是的。我的想法是，我們引導第三季銷售額下降一到加一。因此，總的來說，整體業務的恢復進展朝著積極的方向發展。因此，正如我之前提到的，當我們看到第二季促銷活動的發展時，我們的重點實際上是考慮第三季和第四季的計畫。這些行動和改變正在進行中，我們正在與客戶互動並向他們提供報價。因此，隨著進入第三季度，我們的業績將逐漸改善，並使我們的業績恢復持平，這正是我們對全年的預期。

Thank you so much.

太感謝了。

Simeon Gutman, Morgan Stanley.

西蒙古特曼，摩根士丹利。

I wanted to ask Denise about the industry. There seems to have been this like synchronous slowing little bit in beauty and then a lot from – it looks like middle and lower income, and I missed some of the prepared remarks, but curious on the industry, if it’s – we have reached some kind of peak in innovation and consumption or it’s just the macro and the wallet pressure is waning. Is there anything with innovation that’s not there? And why do you think that we might be seeing this pullback now?

我想向丹尼斯詢問這個行業的狀況。美容領域似乎出現了同步放緩，然後又大幅放緩——看起來是中低收入，我錯過了一些準備好的評論，但對這個行業感到好奇，如果它是—— “我們在創新和消費方面已經達到了某種頂峰，或者這只是宏觀因素，錢包壓力正在減弱。還有什麼創新是不存在的嗎？您認為為什麼我們現在可能會看到這種回調？

Yes. Simeon, happy to share at least some perspectives that I see through the data that I can examine in our business. What we talked about a little bit in the prepared remarks was a bit of the bifurcation of the customer, which is interesting that on the pro side, which serves more middle to more of an upper income customer demographic is that client sitting in the chair. We have actually seen pretty healthy stylist demand, which nice business there. And underneath that, the innovation cycle on the hair care, care color side for the pro is pretty robust. And particularly what we are picking up in distribution on some core performing brands has been solid.

是的。Simeon，很高興至少分享一些我透過可以在我們的業務中檢查的數據看到的觀點。我們在準備好的演講中談到了客戶的一些分歧，有趣的是，在專業方面，服務於更多中等到高收入客戶群的是坐在椅子上的客戶。我們實際上看到了相當健康的造型師需求，這生意很好。在此之下，專業人士在護髮、護理顏色方面的創新週期相當強勁。特別是我們在一些核心表現品牌的分銷方面取得的成果一直很穩固。

And so as we look to the second half of the year, we see that continuing and at least at this point, while we are monitoring it quite closely, our stylists feel pretty good about their book of business and where they are headed. I think the bifurcation comes and what we can see through our Sally data is that our lower income customer in Sally because we do serve all income levels, but we mix a little bit more lower income. That lower income customer has been the customer where the frugality is coming through more that when they are buying, they are looking for the deals, they are looking for ways to stretch those dollars a little bit more or be a little bit more frugal. I don’t think that the challenge is really an innovation cycle towards the lower end.

因此，當我們展望今年下半年時，我們看到這種情況仍在繼續，至少在這一點上，雖然我們正在密切監控，但我們的造型師對他們的業務和發展方向感到非常滿意。我認為分歧已經到來，透過莎莉數據我們可以看到，莎莉的低收入客戶是因為我們確實為所有收入水平提供服務，但我們混合了更多的低收入客戶。低收入客戶一直是節儉的客戶，當他們購買時，他們正在尋找優惠，他們正在尋找方法來多花一點錢或更節儉一點。我不認為挑戰其實是面向低端的創新週期。

As we mentioned, we also have our Happy Beauty pilot, which serves, I would call it right now primarily a middle-income customer and you weren’t necessarily seeing that same pull back or challenge with transactions and ticket there that we are seeing more on the Sally side. So I don’t think the innovation cycle is really the cause. I think it’s more of the customer pocketbook and that lower-income customer just feeling that much more pressure.

正如我們所提到的，我們還有我們的 Happy Beauty 試點項目，我現在主要服務於中等收入客戶，您不一定會看到我們所看到的交易和門票方面的同樣的回落或挑戰更多的是莎莉方面。所以我認為創新週期並不是真正的原因。我認為這更多的是客戶的錢包，而低收入客戶只是感受到了更大的壓力。

And I know you mentioned a little bit about the back half of your year. I don’t want to get into quarter-to-date, but curious if the trends have continued or what we were seeing in the last, like, I don’t know, four weeks to six weeks could have been a bit of a blip, I don’t know, pent-up demand, consumer spending on other things because the weather got better, and maybe now the wallet can return to normal because we have seen some head fakes before, whether it’s the industry and/or in the consumer. Curious if you are seeing any pivots again, not to get too granular into quarter-to-date, but of a different perspective.

我知道你提到了今年下半年的情況。我不想透露季度至今的情況，但很好奇這種趨勢是否持續下去，或者我們在過去看到了什麼，比如，我不知道，四個星期到六個星期可能有點我不知道，被壓抑的需求，消費者在其他事情上的支出，因為天氣好轉，也許現在錢包可以恢復正常，因為我們以前見過一些假頭，無論是行業和/或消費者。很好奇您是否再次看到任何轉變，不是為了太詳細地了解季度至今，而是從不同的角度來看。

Yes. If I look out over the longer term, we have seen a very dynamic customer on both sides of the business, right, different choices being made at different times. And I think as you mentioned, these cycles that seem to happen around pockets of spending and then maybe pockets of a bit more frugality. What I would more say is we certainly -- we guided to the minus one to plus one, which is a bit of a sequential improvement from where we were this past quarter in terms of our sales performance. That reflects our quarter-to-date results and what we are seeing happen with the business.

是的。如果我放眼長遠，我們會看到業務雙方的客戶都非常活躍，是的，在不同的時間做出不同的選擇。我認為正如你所提到的，這些週期似乎發生在一些支出上，然後可能是一些節儉的支出。我更想說的是，我們當然 - 我們引導負一到正一，這與我們上個季度的銷售業績相比是一個連續的改善。這反映了我們本季迄今的業績以及我們所看到的業務情況。

And I would say, in general, seeing continued solid performance on that BSG side and with a little bit of the softness continuing on the Sally side is what's underneath those numbers. We expect that for us, a factor as we are going through the year as well is now on the BSG side since we lapped one of the challenges with one of our hair care brands in the second quarter. But that's just an underlying good guy to deliver us back into the territory of the flat sales, flat comp that we guided to for the full year.

我想說，總的來說，BSG 方面持續穩定的表現，而 Sally 方面繼續表現疲軟，這就是這些數字背後的原因。我們預計，對我們來說，這一年的一個因素現在也在 BSG 方面，因為我們在第二季度克服了我們的一個護髮品牌的挑戰之一。但這只是一個潛在的好人，可以讓我們回到全年指導的固定銷售、固定補償的領域。

So everything about the trend of the start of this quarter is reflected in our guidance. And feel like following the new news of a little bit softer AUR that came through, we set another inflection point here with the customer that we are managing through.

因此，有關本季初趨勢的一切都反映在我們的指導下。感覺隨著 AUR 稍微疲軟的新消息傳來，我們與我們正在管理的客戶一起設定了另一個轉折點。

Thanks. Good luck.

謝謝。祝你好運。

I'm sorry. That's the final question.

對不起。這是最後一個問題。

Great. Well, thank you all. We appreciate all of our shareholders and appreciate all of you tuning in to hear more about our quarter today. And as always, thank you to all of our associates around the world for serving our customers. And we look forward to connecting with everyone again next quarter.

偉大的。嗯，謝謝大家。我們感謝所有股東，也感謝你們所有人收聽今天有關我們季度的更多資訊。一如既往，感謝我們在世界各地為客戶提供服務的所有員工。我們期待下個季度再次與大家聯繫。

Thank you. And ladies and gentlemen, that does conclude our conference for today. Thank you for your participation and for using AT&T teleconference. You may now disconnect.

謝謝。女士們、先生們，我們今天的會議到此結束。感謝您的參與和使用 AT&T 電話會議。您現在可以斷開連線。