Regis to Remain Independent Public Co.
Four months after it began exploring “strategic alternatives,” Regis Corporation said Wednesday that its board has decided that it will continue with its existing business plan and remain an independent public company.
The announcement dispels rumors of a possible sale or the substantial alteration of the Minneapolis-based hair-care company's business or strategy. Since August, when Regis disclosed its plans to explore various options, it has not disclosed any developments with regard to its findings or intentions.
“The board and management team are committed to enhancing shareholder value,” Chairman and CEO Paul D. Finkelstein said in a statement. “After careful review of the strategic alternatives currently available, and with the assistance of our legal and financial advisors, we believe that our stand-alone strategy will deliver superior value for our investors in the long-term compared to the alternatives that were presented as part of our review.”
Finkelstein didn't disclose details about those alternatives but added that he sees “no ceiling with respect to our growth opportunities.”
In an attempt to boost long-term shareholder value, Regis plans to take a number of actions going forward. They include implementing new in-store and marketing initiatives, offering unspecified new services and products in its salons, accelerating a planned expansion of Supercuts-branded salons in some “growth markets,” improving customer satisfaction, and increasing marketing spend for its Promenade-branded salons.
Regis also said that it wants to invest in the “relatively uncrowded” male hair-care market through a new sports-themed salon concept called Pro-Cuts.
Regis has struggled and trimmed expenses in recent years as consumers reduced the frequency of their salon visits amid the recession, but the company's bottom line has showed some signs of a rebound in recent months. Net income totaled $42.7 million, or 71 cents per share, in the fiscal year that ended in August-a vast improvement from the net loss of $124.5 million reported in the company's previous fiscal year. Meanwhile, revenue for the full year fell about 3 percent to $2.36 billion.
Regis operates more than 12,700 salons, cosmetology education centers, and hair restoration centers worldwide-including franchised locations. Those locations operate under numerous concepts, including-in addition to its namesake salons-Supercuts, MasterCuts, Cost Cutters, and Hair Club for Men and Women.