Regis Takes Immediate Action to Mitigate COVID-19 Impact
March 19 2020 - 6:00AM
Business Wire
Regis Corporation (NYSE: RGS), a leader in the haircare
industry, whose primary business is franchising, owning, and
operating technology enabled hair salons, today announced it has,
over the last few weeks, taken various actions to mitigate the
effect on its customers, franchisees, and corporate business
operations from the national emergency that has arisen as a result
of the COVID-19 virus.
Regis has taken a number of proactive measures in its salon
operations, including:
- Regis has temporarily suspended operations in certain areas as
required by government mandate and has been adjusting days of
service or reducing hours of operation at select company-owned
salon locations where it supports the company’s liquidity
initiatives.
- Online check-in has been encouraged and utilized in order to
reduce the number of customers in the waiting area of our salons at
any given time.
- Implemented an increased focus on cleanliness and sanitization
by increasing and adding to our current supply of cleaning and
sanitizing materials to ensure our stylists can clean and disinfect
the salons even more thoroughly throughout the course of each
business day.
- Close coordination of activities and risk mitigation efforts
with all franchisees.
At the corporate level, Regis’s actions include the following
additional measures:
- Regis has drawn an additional $183 million from its current
committed credit facility as a precautionary measure in order to
increase its cash position and preserve financial flexibility in
light of the current uncertainty in the global economy. Taking into
account Regis’s existing cash balance of approximately $61 million
and the $183 million credit facility draw, Regis maintains
approximately $244 million of liquidity at this time.
- In recognition of the difficult challenges that may be faced by
its franchisees, Regis has temporarily suspended the collection of
ad fund fees from its franchisees from March 1st through June 30th
of this year. Regis is hopeful this will enable our franchisees,
many of whom are small business owners, to address potential
hardships during this national emergency.
- Requested that all non-essential personnel at our office
locations work remotely utilizing remote technologies the company
launched several months ago.
- Thoughtfully managing our purchasing activity and payables
cycle based on evolving business conditions.
Hugh Sawyer, Chairman, President and CEO of Regis said,
“Although our strategy has not changed, in the midst of these
uncertain times resulting from the COVID-19 outbreak we drew upon
our existing credit facility in an abundance of caution as part of
our company-wide contingency planning effort. “We intend to take
every appropriate step to facilitate the financial integrity of our
company as we consider the safety and welfare of our employees and
customers while confronting a business threat of still uncertain
severity and duration,” concluded Mr. Sawyer.
Kersten Zupfer, EVP and Chief Financial Officer stated, “We
appreciate the support of our lenders, franchisees and other key
constituents as we continue to vigorously manage our business
during this unprecedented crisis.”
About Regis Corporation
Regis Corporation (NYSE:RGS) is a leader in beauty salons and
cosmetology education. As of December 31, 2019, the Company
franchised, owned or held ownership interests in 7,152 worldwide
locations. Regis' franchised and corporate locations operate under
concepts such as Supercuts®, SmartStyle®, Cost Cutters®, Roosters®
and First Choice Haircutters®. Regis maintains an ownership
interest in Empire Education Group in the U.S. For additional
information about the Company, including a reconciliation of
certain non-GAAP financial information and certain supplemental
financial information, please visit the Investor Information
section of the corporate website at www.regiscorp.com.
Safe Harbor Statement
This press release contains or may contain "forward-looking
statements" within the meaning of the federal securities laws,
including statements concerning anticipated future events and
expectations that are not historical facts. These forward-looking
statements are made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. The
forward-looking statements in this document reflect management's
best judgment at the time they are made, but all such statements
are subject to numerous risks and uncertainties, which could cause
actual results to differ materially from those expressed in or
implied by the statements herein. Such forward-looking statements
are often identified herein by use of words including, but not
limited to, "may," "believe," "project," "forecast," "expect,"
"estimate," "anticipate," and "plan." In addition, the following
factors could affect the Company's actual results and cause such
results to differ materially from those expressed in
forward-looking statements. These factors include a potential
material reduction in revenue from our company-owned and franchised
salons as a result of the uncertain duration and severity of the
COVID-19 outbreak as well as the health of our stylists, customers
and employees. Additional information concerning potential factors
that could affect future financial results is set forth under Item
1A on Form 10-K. We undertake no obligation to publicly update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise. However, your attention is
directed to any further disclosures made in our subsequent annual
and periodic reports filed or furnished with the SEC on Forms 10-K,
10-Q and 8-K and Proxy Statements on Schedule 14A.
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REGIS CORPORATION Kersten Zupfer
investorrelations@regiscorp.com
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