Sally Beauty (SBH) 10-Q 4 Aug 16 2016 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Jun. 30, 2016	Jul. 29, 2016
Document and Entity Information
Entity Registrant Name	Sally Beauty Holdings, Inc.
Entity Central Index Key	1,368,458
Document Type	10-Q
Document Period End Date	Jun. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--09-30
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		146,444,961
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q3

Consolidated Statements of Earn

Consolidated Statements of Earnings - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Consolidated Statements of Earnings
Net sales	$ 998,161	$ 967,890	$ 2,976,260	$ 2,870,112
Cost of products sold and distribution expenses	499,185	486,571	1,495,761	1,447,572
Gross profit	498,976	481,319	1,480,499	1,422,540
Selling, general and administrative expenses	339,459	327,870	1,020,497	982,279
Depreciation and amortization	25,433	22,600	72,524	64,168
Operating earnings (loss)	134,084	130,849	387,478	376,093
Interest expense	26,703	29,221	117,617	87,690
Earnings (loss) before provision for income taxes	107,381	101,628	269,861	288,403
Provision for income taxes	39,462	39,165	99,540	109,496
Net earnings	$ 67,919	$ 62,463	$ 170,321	$ 178,907
Earnings per share:
Basic (in dollars per share)	$ 0.47	$ 0.40	$ 1.15	$ 1.14
Diluted (in dollars per share)	$ 0.46	$ 0.39	$ 1.14	$ 1.13
Weighted average shares:
Basic (in shares)	145,957	157,110	147,741	156,901
Diluted (in shares)	147,837	159,120	149,476	158,875

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Consolidated Statements of Comprehensive Income
Net earnings	$ 67,919	$ 62,463	$ 170,321	$ 178,907
Other comprehensive income (loss):
Foreign currency translation adjustments	(14,119)	11,815	(16,191)	(35,344)
Total other comprehensive income (loss), before tax	(14,119)	11,815	(16,191)	(35,344)
Other comprehensive income (loss), net of tax	(14,119)	11,815	(16,191)	(35,344)
Total comprehensive income (loss)	$ 53,800	$ 74,278	$ 154,130	$ 143,563

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2016	Sep. 30, 2015
Current assets:
Cash and cash equivalents	$ 90,997	$ 140,038
Trade accounts receivable, less allowance for doubtful accounts of $1,222 at June 30, 2016 and $1,162 at September 30, 2015	48,925	48,602
Accounts receivable, other	35,539	42,490
Inventory	909,255	885,214
Other current assets	40,640	37,049
Deferred income tax assets, net	33,789	33,709
Total current assets	1,159,145	1,187,102
Property and equipment, net of accumulated depreciation of $466,611 at June 30, 2016 and $428,501 at September 30, 2015	307,823	270,847
Goodwill	520,093	524,369
Intangible assets, excluding goodwill, net of accumulated amortization of $107,637 at June 30, 2016 and $97,897 at September 30, 2015	88,930	98,848
Other assets	15,105	13,185
Total assets	2,091,096	2,094,351
Current liabilities:
Current maturities of long-term debt	721	755
Accounts payable	280,224	275,917
Accrued liabilities	184,691	208,717
Income taxes payable	2,956	6,310
Total current liabilities	468,592	491,699
Long-term debt	1,782,883	1,786,839
Other liabilities	21,855	27,734
Deferred income tax liabilities, net	100,671	85,900
Total liabilities	2,374,001	2,392,172
Stockholders' deficit:
Common stock, $0.01 par value. Authorized 500,000 shares;146,375 and 151,898 shares issued and 146,023 and 151,452 shares outstanding at June 30, 2016 and September 30, 2015, respectively	1,460	1,515
Preferred stock, $0.01 par value. Authorized 50,000 shares; none issued
Accumulated deficit	(190,469)	(218,670)
Treasury Stock, 121 shares, at cost		(2,961)
Accumulated other comprehensive loss, net of tax	(93,896)	(77,705)
Total stockholders' deficit	(282,905)	(297,821)
Total liabilities and stockholders' deficit	$ 2,091,096	$ 2,094,351

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) shares in Thousands, $ in Thousands	Jun. 30, 2016	Sep. 30, 2015
Consolidated Balance Sheets
Trade accounts receivable, allowance for doubtful accounts (in dollars)	$ 1,222	$ 1,162
Property and equipment, accumulated depreciation (in dollars)	466,611	428,501
Intangible assets, excluding goodwill, accumulated amortization (in dollars)	$ 107,637	$ 97,897
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, Authorized shares	500,000	500,000
Common stock, shares issued	146,375	151,898
Common stock, shares outstanding	146,023	151,452
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, Authorized shares	50,000	50,000
Preferred stock, shares issued	0	0
Treasury stock shares, at cost	121	121

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands		9 Months Ended
		Jun. 30, 2016	Jun. 30, 2015
Cash Flows from Operating Activities:
Net earnings		$ 170,321	$ 178,907
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization		72,524	64,168
Share-based compensation expense		10,011	13,466
Amortization of deferred financing costs		2,467	2,843
Excess tax benefit from share-based compensation		(1,296)	(23,209)
Loss on extinguishment of debt		33,296
Deferred income taxes		12,787	7,067
Changes in (exclusive of effects of acquisitions):
Trade accounts receivable		(956)	(564)
Accounts receivable, other		6,338	9,412
Inventory		(32,759)	(61,833)
Other current assets		(4,403)	15,651
Other assets		(923)	6
Accounts payable and accrued liabilities		(11,182)	(189)
Income taxes payable		(1,851)	(551)
Other liabilities		(5,561)	1,737
Net cash provided by operating activities		248,813	206,911
Cash Flows from Investing Activities:
Capital expenditures		(110,798)	(70,649)
Proceeds from disposal of property and equipment		2,528
Acquisitions, net of cash acquired		(2,250)	(2,765)
Net cash used by investing activities		(110,520)	(73,414)
Cash Flows from Financing Activities:
Proceeds from issuance of long-term debt		912,000	983
Repayments of long-term debt		(938,346)	(1,619)
Repurchases of common stock		(162,367)	(74,284)
Debt issuance costs		(12,748)
Proceeds from exercises of stock options		13,072	52,627
Excess tax benefit from share-based compensation		1,296	23,209
Net cash provided by financing activities		(187,093)	916
Effect of foreign exchange rate changes on cash and cash equivalents		(241)	(1,843)
Net (decrease) increase in cash and cash equivalents		(49,041)	132,570
Cash and cash equivalents, beginning of period		140,038	106,575
Cash and cash equivalents, end of period		90,997	239,145
Supplemental Cash Flow Information:
Interest paid	[1]	138,563	112,647
Income taxes paid		$ 86,916	$ 83,074
[1]	For the nine months ended June 30, 2016, interest paid includes $25.8 million in call premiums paid in connection with the Company’s December 2015 redemption in full of its senior notes due 2019.

Consolidated Statements of Cas7

Consolidated Statements of Cash Flows (Parenthetical) $ in Millions	9 Months Ended
	Jun. 30, 2016USD ($)
Senior notes due Nov. 2019
Consolidated Statements of Cash Flows (Parenthetical)
Call premiums paid upon the redemption of certain notes	$ 25.8

Description of Business and Bas

Description of Business and Basis of Presentation	9 Months Ended
	Jun. 30, 2016
Description of Business and Basis of Presentation
Description of Business and Basis of Presentation	1. Description of Business and Basis of Presentation Description of Business Sally Beauty Holdings, Inc. and its consolidated subsidiaries (“Sally Beauty” or “the Company”) sell professional beauty supplies through its Sally Beauty Supply retail stores located in the U.S., Puerto Rico, Canada, Mexico, Chile, Colombia, Peru, the United Kingdom, Ireland, Belgium, France, Germany, the Netherlands and Spain. Additionally, the Company distributes professional beauty products to salons and salon professionals through its Beauty Systems Group (“BSG”) store operations and a commissioned direct sales force that calls on salons primarily in the U.S., Canada, the United Kingdom and certain other countries in Europe, and to franchises in the southern and southwestern regions of the U.S. and in Mexico through the operations of its subsidiary Armstrong McCall. A significant number of the Company’s products are also available through a number of Sally Beauty Supply and BSG-operated websites. Certain beauty products sold by BSG and Armstrong McCall are sold under exclusive territory agreements with the manufacturers of the products. Basis of Presentation The accompanying consolidated interim financial statements include the accounts of the Company and its subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation. In the opinion of management, these consolidated financial statements reflect all adjustments which are of a normal recurring nature and which are necessary to present fairly the Company’s consolidated financial position as of June 30, 2016 and September 30, 2015, its consolidated results of operations for the three and nine months ended June 30, 2016 and 2015, and consolidated cash flows for the nine months ended June 30, 2016 and 2015. All references in these notes to “management” are to the management of Sally Beauty.

Significant Accounting Policies

Significant Accounting Policies	9 Months Ended
	Jun. 30, 2016
Significant Accounting Policies
Significant Accounting Policies	2. Significant Accounting Policies The consolidated interim financial statements included herein are unaudited and have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and note disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading. These consolidated interim financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2015. The Company adheres to the same accounting policies in the preparation of its interim financial statements. As permitted under GAAP, interim accounting for certain expenses, including income taxes, is based on full year assumptions. Such amounts are expensed in full in the year incurred. For interim financial reporting purposes, income taxes are recorded based upon estimated annual effective income tax rates. The results of operations for the interim periods reported upon herein are not necessarily indicative of the results that may be expected for any future interim period or any entire fiscal year.

Recent Accounting Pronouncement

Recent Accounting Pronouncements	9 Months Ended
	Jun. 30, 2016
Recent Accounting Pronouncements
Recent Accounting Pronouncements	3. Recent Accounting Pronouncements The Company has not yet adopted and is currently assessing the potential effect of the following pronouncements on its consolidated financial statements: In September 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments (“ASU 2015-16”) which will eliminate the current requirement to recognize measurement-period adjustments to provisional amounts retrospectively. Instead, ASU 2015-16 requires the acquirer to recognize measurement-period adjustments, as well as the impact on earnings of changes in depreciation, amortization and similar items (if any) resulting from the change to the provisional amounts, in the period when the amount of each measurement-period adjustment is determined. For public companies, this amendment is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. In November 2015, the FASB issued ASU No. 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Income Taxes (“ASU 2015-17”) which aims to simplify the classification of deferred taxes on the balance sheet. More specifically, ASU 2015-17 will require that all deferred tax assets and liabilities, and any related valuation allowance, be reported as noncurrent in a classified balance sheet. The new guidance will replace the existing practice of reporting deferred taxes for each tax jurisdiction (or taxing component of a jurisdiction) as (a) a net current asset or liability and (b) a net noncurrent asset or liability. The new guidance does not change the existing requirement that only permits offsetting assets and liabilities within the same jurisdiction. For public companies, this amendment is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted. In February 2016, the FASB issued ASU No. 2016-02, Leases , which will require lessees to report on their balance sheets a right-of-use asset and a lease liability in connection with most lease agreements classified as operating leases under the current guidance. The lease liability will be measured based on the present value of future lease payments, subject to certain conditions. The right-of-use asset will be measured based on the initial amount of the liability, plus certain initial direct costs. The new guidance will further require that leases be classified at inception as either (a) operating leases or (b) finance leases. For operating leases, periodic expense will generally be flat (straight-line) throughout the life of the lease. For finance leases, periodic expense will decline (similar to capital leases under current rules) over the life of the lease. The new standard must be adopted using a modified retrospective transition method. For public companies, this amendment is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. In March 2016, the FASB issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting , intended to simplify various aspects of how share-based payments are recorded and presented on the financial statements. For example, the new guidance will require that all the income tax effect related to share-based payments be recorded in income tax expense. The new guidance further removes the current requirement to delay recognition of a windfall tax benefit until it reduces current taxes payable. In addition, the new standard will require that excess tax benefits and shortfalls from share-based compensation awards be reported as operating activities in the statement of cash flows. For public companies, these amendments are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted. In addition, the Company has not yet adopted the following recent accounting pronouncements and does not believe their adoption will have a material effect on its consolidated financial statements: In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers which will supersede Accounting Standards Codification (“ASC”) Topic 605, Revenue Recognition . In August 2015, the FASB deferred the effective date of this new standard by one year. A core principle of the new guidance, as amended, is that an entity should measure revenue in connection with its sale of goods and services to a customer based on an amount that depicts the consideration to which the entity expects to be entitled in exchange for each of those goods and services. For a contract that involves more than one performance obligation, the entity must (a) determine or, if necessary, estimate the standalone selling price at inception of the contract for the distinct goods or services underlying each performance obligation and (b) allocate the transaction price to each performance obligation on the basis of the relative standalone selling prices. In addition, under the new guidance, an entity should recognize revenue when (or as) it satisfies each performance obligation under the contract by transferring the promised good or service to the customer. A good or service is deemed transferred when (or as) the customer obtains control of that good or service. The new standard permits the use of either the retrospective or cumulative effect transition method. For public companies, this amendment is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Early application is permitted, but no earlier than December 16, 2016. The Company has not yet selected a transition method. In April 2015, the FASB issued ASU No. 2015-05, Customer’s Accounting for Fees Paid in Cloud Computing Arrangement . This pronouncement provides guidance to determine whether a cloud-based computing arrangement includes a software license. If a cloud-based computing arrangement includes a software license, the customer must account for the software element of the arrangement consistent with the acquisition of other software licenses. Otherwise, the customer must account for the arrangement as a service contract. The new standard permits the use of either the prospective or retrospective transition method. For public companies, this amendment is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015.

Fair Value Measurements

Fair Value Measurements	9 Months Ended
	Jun. 30, 2016
Fair Value Measurements
Fair Value Measurements	4. Fair Value Measurements The Company’s financial instruments consist of cash equivalents, trade and other accounts receivable, accounts payable, foreign currency derivative instruments and debt. The carrying amounts of cash equivalents, trade and other accounts receivable and accounts payable approximate their respective fair values due to the short-term nature of these financial instruments. The Company measures on a recurring basis and discloses the fair value of its financial instruments under the provisions of ASC Topic 820, Fair Value Measurement , as amended (“ASC 820”). The Company defines “fair value” as the price that would be received to sell an asset or paid to transfer a liability (i.e., the exit price) in an orderly transaction between market participants at the measurement date. ASC 820 establishes a three-level hierarchy for measuring fair value and requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. This valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability on the measurement date. The three levels of that hierarchy are defined as follows: Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities; Level 2 - Unadjusted quoted prices in active markets for similar assets or liabilities; or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active; or inputs other than quoted prices that are observable for the asset or liability; or inputs that are derived principally from or corroborated by observable market data; and Level 3 - Unobservable inputs for the asset or liability. Consistent with this hierarchy, the Company categorized certain of its financial assets and liabilities as follows at June 30, 2016 and September 30, 2015 (in thousands): As of June 30, 2016 Total Level 1 Level 2 Level 3 Assets Foreign exchange contracts (b) $ $ — $ — Total assets $ $ — $ — Liabilities Long-term debt (c) $ $ $ — Foreign exchange contracts (b) — — Total liabilities $ $ $ — As of September 30, 2015 Total Level 1 Level 2 Level 3 Assets Cash equivalents (a) $ $ $ — — Foreign exchange contracts (b) — — Total assets $ $ $ — Liabilities Long-term debt (c) $ $ $ — Foreign exchange contracts (b) — — Total liabilities $ $ $ — (a) Cash equivalents consist of highly liquid investments which have no maturity and are valued using unadjusted quoted market prices for such securities. The Company may from time to time invest in securities with maturities of three months or less (consisting primarily of investment-grade corporate and government bonds), with the primary investment objective of minimizing the potential risk of loss of principal. (b) Foreign exchange contracts (including foreign currency forwards and options) are valued for purposes of this disclosure using widely accepted valuation techniques, such as discounted cash flow analyses, and observable inputs, such as market foreign currency exchange rates. Please see Note 11 for more information about the Company’s foreign exchange contracts. (c) Long-term debt (including current maturities and borrowings under the ABL facility, if any) is carried in the Company’s consolidated financial statements at amortized cost of $1,808.1 million at June 30, 2016 and $1,809.4 million at September 30, 2015, less unamortized debt issuance costs of $24.5 million and $21.8 million at June 30, 2016 and September 30, 2015, respectively. The Company’s senior notes are valued for purposes of this disclosure using unadjusted quoted market prices for such debt securities. Other long-term debt (consisting primarily of borrowings under the ABL facility, if any, and capital lease obligations) is generally valued for purposes of this disclosure using widely accepted valuation techniques, such as discounted cash flow analyses, and observable inputs, such as market interest rates. Please see Note 10 for more information about the Company’s debt.

Accumulated Stockholders' Equit

Accumulated Stockholders' Equity (Deficit)	9 Months Ended
	Jun. 30, 2016
Accumulated Stockholders' Equity (Deficit)
Accumulated Stockholders' Equity (Deficit)	5. Accumulated Stockholders’ Equity (Deficit) In August 2014, we announced that our Board of Directors approved a share repurchase program authorizing us to repurchase up to $1.0 billion of our common stock over a period of approximately three years (the “2014 Share Repurchase Program”). The 2014 Share Repurchase Program expires on September 30, 2017. During the nine months ended June 30, 2016 and 2015, the Company repurchased and subsequently retired approximately 6.2 million and 2.3 million shares, respectively, of its common stock under the 2014 Share Repurchase Program at an aggregate cost of $162.4 million and $74.3 million, respectively. We funded these share repurchases with existing cash balances, cash from operations and borrowings under the ABL facility. The Company reduced common stock and additional paid-in capital, in the aggregate, by these amounts. However, as required by GAAP, to the extent that share repurchase amounts exceeded the balance of additional paid-in capital prior to us recording such repurchases, we recorded the excess in accumulated deficit. At June 30, 2016 and September 30, 2015, accumulated other comprehensive loss consists of cumulative foreign currency translation adjustments of $93.9 million and $77.7 million, respectively, net of income taxes of $2.3 million at both dates. Comprehensive income (loss) reflects changes in accumulated stockholders’ equity (deficit) from sources other than transactions with stockholders and, as such, includes net earnings and certain other specified components. Currently, the Company’s only component of comprehensive income, other than net earnings, is foreign currency translation adjustments, net of income tax.

Earnings Per Share

Earnings Per Share	9 Months Ended
	Jun. 30, 2016
Earnings Per Share
Earnings Per Share	6. Earnings Per Share Basic earnings per share is calculated by dividing net earnings by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is calculated similarly but includes the potential dilution from the exercise of all outstanding stock options and from stock awards, except when the effect would be anti-dilutive. The following table sets forth the computations of basic and diluted earnings per share (in thousands, except per share data): Three Months Ended June 30, Nine Months Ended June 30, 2016 2015 2016 2015 Net earnings $ $ $ $ Total weighted average basic shares Dilutive securities: Stock options and stock awards Total weighted average diluted shares Earnings per share: Basic $ $ $ $ Diluted $ $ $ $ At June 30, 2016 and 2015, options to purchase 66,573 shares and 33,592 shares, respectively, of the Company’s common stock were outstanding but not included in the computations of diluted earnings per share for the three months ended June 30, 2016 and 2015, respectively, since these options were anti-dilutive. At June 30, 2016 and 2015, options to purchase 1,094,343 shares and 1,091,466 shares, respectively, of the Company’s common stock were outstanding but not included in the computations of diluted earnings per share for the nine months ended June 30, 2016 and 2015, respectively, since these options were anti-dilutive. Anti-dilutive options are: (a) out-of-the-money options (options the exercise price of which is greater than the average price per share of the Company’s common stock during the period), and (b) in-the-money options (options the exercise price of which is less than the average price per share of the Company’s common stock during the period) for which the sum of assumed proceeds, including any unrecognized compensation expense related to such options, exceeds the average price per share for the period.

Share-Based Payments

Share-Based Payments	9 Months Ended
	Jun. 30, 2016
Share-Based Payments
Share-Based Payments	7. Share-Based Payments The following table presents the total compensation cost charged against income and included in selling, general and administrative expenses for all share-based compensation arrangements, and the related tax benefits recognized in our consolidated statements of earnings (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2016 2015 2016 2015 Share-based compensation expense $ $ $ $ Income tax benefit related to share-based compensation expense $ $ $ $ Performance-Based Unit Awards The Company from time to time grants Performance-Based Unit (“Performance Units”) awards subject to three-year cliff-vesting provisions, pursuant to the Sally Beauty Holdings, Inc. Amended and Restated 2010 Omnibus Incentive Plan (the “2010 Plan”). The Company’s Performance Units represent unsecured obligations of the Company to issue shares of its common stock. The number of shares, if any, which will be issued in connection with these awards, is contingent upon both (a) employee service conditions and (b) the achievement of specified Company performance targets. The Company measures the cost of services received from officers and employees in exchange for an award of Performance Units based on the fair value of the award on the date of grant and it recognizes expense over the requisite service period (generally three years). The fair value of a Performance Unit is determined based on the closing market price of the Company’s common stock on the date of grant. During the nine months ended June 30, 2016, the Company granted approximately 152,000 Performance Units (“target shares”) to its officers and employees. Under the terms of these awards, a grantee may earn from 0% to 200% of his or her target shares, with the ultimate settlement (and expense recognized) dependent on the Company achieving certain specified cumulative performance targets during the three-year period ending on September 30, 2018 (the “Performance Period”) and satisfaction of the employee service condition. Periodic expense for Performance Unit awards, which is estimated quarterly, is based on the Company’s projected performance during the Performance Period compared to the performance targets contained in the award. As such, for the nine months ended June 30, 2016, the Company has estimated and recognized compensation expense at 100% of the performance targets since it believes achievement of the performance targets is probable. To date, the Company has only granted Performance Units subject to the Company’s achievement of two performance targets: consolidated sales growth (as defined in the award documents) and return on invested capital (as defined in the award documents), in addition to service conditions. For the awards issued during the nine months ended June 30, 2016, 40% of the award is contingent on achieving the consolidated sales growth target and 60% is contingent on achieving the return on invested capital target. The following table presents a summary of the activity for the Company’s Performance Unit awards for the nine months ended June 30, 2016: Performance Unit Awards Number of Shares (in Thousands) Weighted Average Fair Value Per Share Weighted Average Remaining Vesting Term (in Years) Unvested at September 30, 2015 — $ — — Granted Vested — — Forfeited ) Unvested at June 30, 2016 $ At June 30, 2016, unrecognized compensation costs related to unvested performance unit awards are approximately $2.5 million and are expected to be recognized over the weighted average period of 2.2 years. Service-Based Awards The Company measures the cost of services received from employees, directors and consultants, if any, in exchange for a service-based award of equity instruments based on the fair value of the award on the date of grant, and recognizes compensation expense on a straight-line basis over the vesting period or over the period ending on the date a participant becomes eligible for retirement, if earlier. The Company granted approximately 1.5 million and 1.2 million service-based stock options and approximately 40,000 and 219,000 service-based restricted share awards to its employees during the nine months ended June 30, 2016 and 2015, respectively. Upon issuance of such grants, the Company recognized accelerated share-based compensation expense of $1.3 million and $4.8 million in the nine months ended June 30, 2016 and 2015, respectively, in connection with certain retirement eligible employees who are eligible to continue vesting awards upon retirement under the provisions of the 2010 Plan. In addition, the Company granted approximately 27,000 and 20,000 service-based restricted stock units to its non-employee directors during the nine months ended June 30, 2016 and 2015, respectively. Stock Option Awards Each option has an exercise price equal to the closing market price of the Company’s common stock on the date of grant and generally has a maximum term of 10 years. Options generally vest ratably over a three or four-year period and are generally subject to forfeiture until the vesting period is complete, subject to certain retirement provisions contained in the 2010 Plan and certain predecessor share-based compensation plans such as the Sally Beauty Holdings, Inc. 2007 Omnibus Incentive Plan. The following table presents a summary of the activity for the Company’s service-based stock option awards for the nine months ended June 30, 2016: Number of Outstanding Options (in Thousands) Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in Years) Aggregate Intrinsic Value (in Thousands) Outstanding at September 30, 2015 $ $ Granted Exercised ) Forfeited or expired ) Outstanding at June 30, 2016 $ $ Exercisable at June 30, 2016 $ $ The following table summarizes additional information about service-based stock options outstanding at June 30, 2016 under the Company’s share-based compensation plans: Options Outstanding Options Exercisable Range of Exercise Prices Number of Options Outstanding (in Thousands) Weighted Average Remaining Contractual Term (in Years) Weighted Average Exercise Price Number of Options Exercisable (in Thousands) Weighted Average Exercise Price $5.24 – 19.99 $ $ $20.00–31.58 Total $ $ The Company uses the Black-Scholes option pricing model to value the Company’s stock options for each stock option award. Using this option pricing model, the fair value of each stock option award is estimated on the date of grant. The fair value of the Company’s stock option awards is expensed on a straight-line basis over the vesting period (generally three or four years) of the stock options or to the date a participant becomes eligible for retirement, if earlier. The weighted average assumptions relating to the valuation of the Company’s stock options are as follows: Nine Months Ended June 30, 2016 2015 Expected life (in years) Expected volatility for the Company’s common stock % % Risk-free interest rate % % Dividend yield % % The expected life of options represents the period of time that the options granted are expected to be outstanding and is based on historical experience of employees of the Company who have been granted stock options. The risk-free interest rate is based on the zero-coupon U.S. Treasury notes with a comparable term as of the date of the grant. Since the Company does not currently expect to pay dividends, the dividend yield used is 0%. The weighted average fair value at the date of grant of the stock options issued by the Company in the nine months ended June 30, 2016 and 2015 was $6.32 and $8.78 per option, respectively. The total intrinsic value of options exercised during the nine months ended June 30, 2016 was $9.1 million. The cash proceeds from these option exercises were $13.1 million and the tax benefit realized from these option exercises was $3.2 million. At June 30, 2016, unrecognized compensation costs related to unvested stock option awards are approximately $11.5 million and are expected to be recognized over the weighted average period of 2.0 years. Restricted Stock Awards The Company from time to time grants service-based restricted stock awards to employees and consultants, if any, under the 2010 Plan. A restricted stock award is an award of shares of the Company’s common stock (which have full voting and dividend rights but are restricted with regard to sale or transfer) the restrictions over which lapse ratably over a specified period of time (generally three to five years). Restricted stock awards are independent of stock option grants and are generally subject to forfeiture if employment terminates prior to these restrictions lapsing, subject to certain retirement provisions of the 2010 Plan. The fair value of the Company’s restricted stock awards is expensed on a straight-line basis over the period (generally three to five years) in which the restrictions on these stock awards lapse (“vesting”) or over the period ending on the date a participant becomes eligible for retirement, if earlier. The fair value of a service-based restricted stock award is determined based on the closing market price of the Company’s common stock on the date of grant. The following table presents a summary of the activity for the Company’s service-based restricted stock awards for the nine months ended June 30, 2016: Restricted Stock Awards Number of Shares (in Thousands) Weighted Average Fair Value Per Share Weighted Average Remaining Vesting Term (in Years) Unvested at September 30, 2015 $ Granted Vested ) Forfeited ) Unvested at June 30, 2016 $ At June 30, 2016, unrecognized compensation costs related to unvested restricted stock awards are approximately $3.8 million and are expected to be recognized over the weighted average period of 2.1 years. Restricted Stock Units The Company also grants service-based RSU awards, which generally vest within one year from the date of grant, pursuant to the 2010 Plan. To date, the Company has only granted service-based RSU awards to its non-employee directors. RSUs represent an unsecured promise of the Company to issue shares of the Company’s common stock. Unless forfeited prior to the vesting date, RSUs are converted into shares of the Company’s common stock generally on the vesting date. An independent director who receives an RSU award may elect, upon receipt of such award, to defer until a later date delivery of the shares of common stock of the Company that would otherwise be issued to such director on the vesting date. RSUs granted prior to the fiscal year 2012 are generally retained by the Company as deferred stock units that are not distributed until six months after the independent director’s service as a director terminates. RSUs are independent of stock option grants and are generally subject to forfeiture if service terminates prior to the vesting of the units. Participants have no voting rights with respect to unvested RSUs. Under the 2010 Plan, the Company may settle the vested deferred stock units with shares of the Company’s common stock or in cash. The Company expenses the cost of a service-based RSU, which is determined to be the fair value of the RSU at the date of grant, on a straight-line basis over the vesting period (generally one year). For these purposes, the fair value of the RSU is determined based on the closing market price of the Company’s common stock on the date of grant. The following table presents a summary of the activity for the Company’s service-based RSUs for the nine months ended June 30, 2016: Restricted Stock Units Number of Shares (in Thousands) Weighted Average Fair Value Per Share Weighted Average Remaining Vesting Term (in Years) Unvested at September 30, 2015 — $ — — Granted Vested — — Forfeited — — Unvested at June 30, 2016 $ At June 30, 2016, unrecognized compensation costs related to unvested RSUs are approximately $0.2 million and are expected to be recognized over the weighted average period of 0.2 years.

Goodwill and Intangible Assets

Goodwill and Intangible Assets	9 Months Ended
	Jun. 30, 2016
Goodwill and Intangible Assets
Goodwill and Intangible Assets	8. Goodwill and Intangible Assets The Company completed its annual assessment for impairment of goodwill during its fiscal quarter ended March 31, 2016 and there were no impairment losses recognized in the current or prior periods presented in connection with the Company’s goodwill. The Company also completed its annual assessment for impairment of intangible assets, other than goodwill, including indefinite-lived intangible assets during its fiscal quarter ended March 31, 2016 and there were no material impairment losses recognized in the current or prior periods presented in connection with the Company’s intangible assets. For the three months ended June 30, 2016 and 2015, amortization expense was $3.4 million and $3.6 million, respectively, and for the nine months ended June 30, 2016 and 2015, amortization expense was $10.3 million and $10.7 million, respectively.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Jun. 30, 2016
Commitments and Contingencies
Commitments and Contingencies	9. Commitments and Contingencies In the fiscal year ended September 30, 2014, the Company disclosed that it had experienced a data security incident (the “2014 data security incident”). In the fiscal year ended September 30, 2015, the Company disclosed that it had experienced a second data security incident (the “2015 data security incident” and, together with the 2014 data security incident, the “data security incidents”). The data security incidents involved the unauthorized installation of malicious software (malware) on our information technology systems, including our point-of-sale systems that, we believe, may have placed at risk certain payment card data for some transactions. The costs that the Company has incurred to date in connection with the data security incidents include professional advisory fees and legal costs and expenses relating to investigating and remediating the data security incidents. During the three months ended June 30, 2016, one of the payment card networks made claims against the Company’s acquiring banks for costs in the aggregate amount of approximately $0.9 million that it asserts its issuing banks have incurred in connection with the 2015 data security incident, including incremental counterfeit fraud losses and non-ordinary course operating expenses, such as card reissuance costs. The Company disputes the validity of these claims and intends to contest them vigorously. The Company has not yet received, but may in the future, receive notice of additional claims by other payment card networks. For the nine months ended June 30, 2016 and 2015, selling, general and administrative expenses reflect expenses of $2.6 million and $5.0 million, respectively, relating to the data security incidents, including an accrued liability of approximately $2.9 million related to loss contingencies associated with the 2014 data security incident recorded during the fiscal year ended September 30, 2015 and an accrued liability of approximately $0.9 million related to loss contingencies associated with the 2015 data security incident recorded during the nine months ended June 30, 2016. As of June 30, 2016, the Company has an aggregate accrued liability relating to the data security incidents of $3.8 million. The Company’s estimated probable losses related to the claims made by the payment card networks in connection with the data security incidents are based on currently available information and expected payments associated with those claims. These estimates may change as new information becomes available or circumstances change. The Company expects to incur additional costs and expenses related to the data security incidents in the future. These costs may result from liabilities related to claims by payment card networks, governmental or third party investigations, proceedings or litigation and legal and other fees necessary to defend against any potential liabilities or claims, and further investigatory and remediation costs. As of June 30, 2016, the scope of these additional costs, or a range thereof, cannot be reasonably estimated. While we do not anticipate these additional costs or liabilities would have a material adverse impact on our business, financial condition and operating results, these additional costs could be significant.

Short-term Borrowings and Long-

Short-term Borrowings and Long-term Debt	9 Months Ended
	Jun. 30, 2016
Short-term Borrowings and Long-term Debt
Short-term Borrowings and Long-term Debt	10. Short-term Borrowings and Long-term Debt Details of long-term debt as of June 30, 2016 and September 30, 2015 are as follows (dollars in thousands): June 30, 2016 September 30, 2015 Interest Rates(a) ABL facility(b) $ — $ — (i) Prime plus (0.50% to 0.75%) or; (ii) LIBOR(b) plus (1.50% to 1.75%) Senior notes due Nov. 2019 — 6.875% Senior notes due Jun. 2022 5.750% Senior notes due Nov. 2023 5.500% Senior notes due Dec. 2025 — 5.625% Total $ $ Plus: capital lease obligations Less: unamortized debt issuance costs and premium, net(c) Total debt $ $ Less: current maturities Total long-term debt $ $ (a) Interest rates shown represent the coupon or contractual rates related to each debt instrument listed. (b) When used in this Quarterly Report, LIBOR means the London Interbank Offered Rate. At June 30, 2016 and September 30, 2015, unamortized debt issuance costs of $1.8 million and $2.4 million, respectively, related to the ABL facility are reported in other assets in the Company’s consolidated balance sheets. (c) Amounts are net of unamortized premium of $5.8 million and $6.5 million as of June 30, 2016 and September 30, 2015, respectively, related to certain notes with an aggregate principal amount of $150.0 million. In 2006, the Company, through its subsidiaries (Sally Investment Holdings LLC and Sally Holdings LLC, which we refer to as “Sally Investment” and “Sally Holdings,” respectively) incurred $1,850.0 million of indebtedness in connection with the Company’s separation from its former parent, The Alberto-Culver Company, which we refer to as Alberto-Culver. In the fiscal year 2011, Sally Holdings entered into a five-year asset-based senior secured loan facility (the “ABL facility”). The availability of funds under the ABL facility is subject to a customary borrowing base comprised of: (i) a specified percentage of our eligible credit card and trade accounts receivable (as defined therein) and (ii) a specified percentage of our eligible inventory (as defined therein), and reduced by (iii) certain customary reserves and adjustments and by certain outstanding letters of credit. The ABL facility includes a $25.0 million Canadian sub-facility for our Canadian operations. In the fiscal year 2013, the Company, Sally Holdings and other parties to the ABL facility entered into an amendment to the ABL facility which, among other things, increased the maximum availability under the ABL Facility to $500.0 million (subject to borrowing base limitations), reduced pricing, relaxed the restrictions regarding the making of Restricted Payments, extended the maturity to July 2018 and improved certain other covenant terms. At June 30, 2016, there were no borrowings outstanding under the ABL facility and the Company had $478.4 million available for borrowing under the ABL facility, including the Canadian sub-facility. Borrowings under the ABL facility are secured by the accounts, inventory and credit card receivables of our domestic subsidiaries and Canadian subsidiaries (in the case of borrowings under the Canadian sub-facility), together with general intangibles and certain other personal property of our domestic subsidiaries and Canadian subsidiaries (in the case of borrowings under the Canadian sub-facility) relating to the accounts and inventory, as well as deposit accounts of our domestic subsidiaries and Canadian subsidiaries (in the case of borrowings under the Canadian sub-facility) and, solely with respect to borrowings by SBH Finance B.V., intercompany notes owed to SBH Finance B.V. by our foreign subsidiaries. In addition, the terms of the ABL facility contain a commitment fee of 0.25% on the unused portion of the facility. In the fiscal year 2012, Sally Holdings and Sally Capital Inc. (collectively, the “Issuers”), both indirectly wholly-owned subsidiaries of the Company, issued $750.0 million aggregate principal amount of their 6.875% Senior Notes due 2019 (the “senior notes due 2019”) and $850.0 million aggregate principal amount of their 5.75% Senior Notes due 2022 (the “senior notes due 2022”), including $150.0 million of the aggregate principal amount of the senior notes due 2022 issued at par plus a premium. Such premium is being amortized over the term of the notes using the effective interest method. The net proceeds from these debt issuances were used to retire outstanding indebtedness in the aggregate principal amount of approximately $1,391.9 million (substantially all of which was incurred in 2006 in connection with our separation from Alberto-Culver) and for general corporate purposes. In December 2015, the Company redeemed in full the senior notes due 2019 at a redemption premium equal to 103.438% primarily with the net proceeds from the issuance of the 5.625% Senior Notes due 2025 (the “senior notes due 2025”), as further discussed below. In the fiscal year 2014, the Issuers issued $200.0 million aggregate principal amount of their 5.5% Senior Notes due 2023 (the “senior notes due 2023”) at par. The Company used the net proceeds from this debt issuance, approximately $196.3 million, to repay borrowings outstanding under the ABL facility of $88.5 million (which borrowings were primarily used to fund share repurchases) and for general corporate purposes, including share repurchases . On December 3, 2015, the Issuers issued $750.0 million aggregate principal amount of their senior notes due 2025 at par. The Company used the net proceeds from this debt issuance (approximately $737.3 million) as well as cash from operations and borrowings under the ABL facility, to redeem in full the senior notes due 2019 at a total redemption cost of $775.8 million, including the redemption premium but excluding accrued interest paid upon redemption of such notes . In connection with our redemption of the senior notes due 2019, we recorded a loss on extinguishment of debt in the amount of approximately $33.3 million, including a redemption premium in the amount of approximately $25.8 million and unamortized deferred financing costs of approximately $7.5 million. In connection with the issuance of the senior notes due 2025, the Company incurred and capitalized financing costs of approximately $12.7 million. This amount is reported as a deduction from the senior notes due 2025 on the Company’s consolidated balance sheets in accordance with GAAP and is being amortized over the term of the senior notes due 2025 using the effective interest method. The senior notes due 2022, the senior notes due 2023 and the senior notes due 2025, which we refer to collectively as “the Senior Notes” or “the senior notes due 2022, 2023 and 2025,” are unsecured obligations of the Issuers and are jointly and severally guaranteed by the Company and Sally Investment, and by each material domestic subsidiary of the Company. Interest on the senior notes due 2022, 2023 and 2025 is payable semi-annually, during the Company’s first and third fiscal quarters. Please see Note 13 for certain condensed financial statement data pertaining to Sally Beauty, the Issuers, the guarantor subsidiaries and the non-guarantor subsidiaries. The senior notes due 2022 carry optional redemption features whereby the Company has the option to redeem the notes, in whole or in part, on or after June 1, 2020 at par, plus accrued and unpaid interest, if any, and on or after June 1, 2017 at par plus a premium declining ratably to par, plus accrued and unpaid interest, if any. Prior to June 1, 2017, the notes may be redeemed, in whole or in part, at a redemption price equal to par plus a make-whole premium as provided in the indenture, plus accrued and unpaid interest, if any. The senior notes due 2023 carry optional redemption features whereby the Company has the option to redeem the notes, in whole or in part, on or after November 1, 2021 at par, plus accrued and unpaid interest, if any, and on or after November 1, 2018 at par plus a premium declining ratably to par, plus accrued and unpaid interest, if any. Prior to November 1, 2018, the notes may be redeemed, in whole or in part, at a redemption price equal to par plus a make-whole premium as provided in the indenture, plus accrued and unpaid interest, if any. In addition, on or prior to November 1, 2016, the Company has the right to redeem at par plus a specified premium, plus accrued and unpaid interest, if any, up to 35% of the aggregate principal amount of notes originally issued, subject to certain limitations, with the proceeds from certain kinds of equity offerings, as defined in the indenture. The senior notes due 2025 carry optional redemption features whereby the Company has the option to redeem the notes, in whole or in part, on or after December 1, 2023 at par, plus accrued and unpaid interest, if any, and on or after December 1, 2020 at par plus a premium declining ratably to par, plus accrued and unpaid interest, if any. Prior to December 1, 2020, the notes may be redeemed, in whole or in part, at a redemption price equal to par plus a make-whole premium as provided in the indenture, plus accrued and unpaid interest, if any. In addition, on or prior to December 1, 2018, the Company has the right to redeem at par plus a specified premium, plus accrued and unpaid interest, if any, up to 35% of the aggregate principal amount of notes originally issued, subject to certain limitations, with the proceeds from certain kinds of equity offerings, as defined in the indenture. Maturities of the Company’s long-term debt are as follows as of June 30, 2016 (in thousands): Twelve months ending June 30: 2017-2021 $ — Thereafter $ Plus: capital lease obligations Less: unamortized debt issuance costs and premium, net Less: current maturities Total long-term debt $ We are a holding company and do not have any material assets or operations other than ownership of equity interests of our subsidiaries. The agreements and instruments governing the debt of Sally Holdings and its subsidiaries contain material limitations on their ability to pay dividends and other restricted payments to us which, in turn, constitute material limitations on our ability to pay dividends and other payments to our stockholders. The ABL facility does not contain any restriction against the incurrence of unsecured indebtedness. However, the ABL facility restricts the incurrence of secured indebtedness if, after giving effect to the incurrence of such secured indebtedness, the Company’s Secured Leverage Ratio exceeds 4.0 to 1.0. At June 30, 2016, the Company’s Secured Leverage Ratio was less than 0.1 to 1.0. Secured Leverage Ratio is defined as the ratio of (i) Secured Funded Indebtedness (as defined in the ABL facility) to (ii) Consolidated EBITDA (as defined in the ABL facility) for the most recently completed twelve fiscal months. The ABL facility is pre-payable and the commitments thereunder may be terminated, in whole or in part, at any time without penalty or premium. T he indentures governing the senior notes due 2022, 2023 and 2025 contain terms which restrict the ability of Sally Beauty’s subsidiaries to incur additional indebtedness. However, in addition to certain other material exceptions, the Company may incur additional indebtedness under the indentures if its Consolidated Coverage Ratio, after giving pro forma effect to the incurrence of such indebtedness, exceeds 2.0 to 1.0 (“Incurrence Test”). At June 30, 2016, the Company’s Consolidated Coverage Ratio was approximately 6.1 to 1.0. Consolidated Coverage Ratio is defined as the ratio of (i) Consolidated EBITDA (as defined in the indentures) for the period containing the most recent four consecutive fiscal quarters, to (ii) Consolidated Interest Expense (as defined in the indentures) for such period. The indentures governing the senior notes due 2022, 2023 and 2025 restrict Sally Holdings and its subsidiaries from making certain dividends and distributions to equity holders and certain other restricted payments (hereafter, a “Restricted Payment” or “Restricted Payments”) to us. However, the indentures permit the making of such Restricted Payments if, at the time of the making of such Restricted Payment, the Company satisfies the Incurrence Test as described above and the cumulative amount of all Restricted Payments made since the issue date of the applicable senior notes does not exceed the sum of: (i) 50% of Sally Holdings’ and its subsidiaries’ cumulative consolidated net earnings since July 1, 2006 (for the senior notes due 2022 and the senior notes due 2023) or since October 1, 2015 (for the senior notes due 2025), plus (ii) the proceeds from the issuance of certain equity securities or conversions of indebtedness to equity, in each case, since the issue date of the applicable senior notes plus (iii) the net reduction in investments in unrestricted subsidiaries since the issue date of the applicable senior notes plus (iv) the return of capital with respect to any sales or dispositions of certain minority investments since the issue date of the applicable senior notes plus (v) $350 million (for the senior notes due 2025). Further, in addition to certain other baskets, the indentures permit the Company to make additional Restricted Payments in an unlimited amount if, after giving pro forma effect to the incurrence of any indebtedness to make such Restricted Payment, the Company’s Consolidated Total Leverage Ratio (as defined in the indentures) is less than 3.25 to 1.00. At June 30, 2016, the Company’s Consolidated Total Leverage Ratio was approximately 2.7 to 1.0. Consolidated Total Leverage Ratio is defined as the ratio of (i) Consolidated Total Indebtedness (as defined in the indentures) minus cash and cash equivalents on-hand up to $100.0 million, in each case, as of the end of the most recently-ended fiscal quarter to (ii) Consolidated EBITDA (as defined in the indentures) for the period containing the most recent four consecutive fiscal quarters. The ABL facility also restricts the making of Restricted Payments. More specifically, under the ABL facility, Sally Holdings may make Restricted Payments if availability under the ABL facility equals or exceeds certain thresholds, and no default then exists under the facility. For Restricted Payments up to $30.0 million during each fiscal year, borrowing availability must equal or exceed the lesser of $75.0 million or 15% of the borrowing base for 45 days prior to such Restricted Payment. For Restricted Payments in excess of that amount, borrowing availability must equal or exceed the lesser of $100.0 million or 20% of the borrowing base for 45 days prior to such Restricted Payment and the Consolidated Fixed Charge Coverage Ratio (as defined below) must equal or exceed 1.1 to 1.0. Further, if borrowing availability equals or exceeds the lesser of $150.0 million or 30% of the borrowing base, Restricted Payments are not limited by the Consolidated Fixed Charge Coverage Ratio test. The Consolidated Fixed Charge Coverage Ratio is defined as the ratio of (i) Consolidated EBITDA (as defined in the ABL facility) during the trailing twelve-month period preceding such proposed Restricted Payment minus certain unfinanced capital expenditures made during such period and income tax payments paid in cash during such period to (ii) fixed charges (as defined in the ABL facility). In addition, during any period that borrowing availability under the ABL facility is less than the greater of $40.0 million or 10% of the borrowing base, the level of the Consolidated Fixed Charge Coverage Ratio that the Company must satisfy is 1.0 to 1.0. As of June 30, 2016, the Consolidated Fixed Charge Coverage Ratio was approximately 3.2 to 1.0. When used in this Quarterly Report, the phrase “Consolidated EBITDA” is intended to have the meaning ascribed to such phrase in the ABL facility or the indentures governing the senior notes due 2022, 2023 and 2025, as appropriate. EBITDA is not a recognized measurement under GAAP and should not be considered a substitute for financial performance and liquidity measures determined in accordance with GAAP, such as net earnings, operating earnings and operating cash flows. The ABL facility and the indentures governing the senior notes due 2022, 2023 and 2025 contain other covenants regarding restrictions on the disposition of assets, the granting of liens and security interests, the prepayment of certain indebtedness, and other matters and customary events of default, including customary cross-default and/or cross-acceleration provisions. As of June 30, 2016, all the net assets of our consolidated subsidiaries were unrestricted from transfer under our credit arrangements.

Derivative Instruments and Hedg

Derivative Instruments and Hedging Activities	9 Months Ended
	Jun. 30, 2016
Derivative Instruments and Hedging Activities
Derivative Instruments and Hedging Activities	11. Derivative Instruments and Hedging Activities Risk Management Objectives of Using Derivative Instruments The Company is exposed to a wide variety of risks, including risks arising from changing economic conditions. The Company manages its exposure to certain economic risks (including liquidity, credit risk, and changes in foreign currency exchange rates and in interest rates) primarily: (a) by closely managing its cash flows from operating and investing activities and the amounts and sources of its debt obligations; (b) by assessing periodically the creditworthiness of its business partners; and (c) through the use of derivative instruments from time to time (including, foreign exchange contracts and interest rate swaps) by Sally Holdings and its subsidiaries. The Company from time to time uses foreign exchange contracts (including foreign currency forwards and options), as part of its overall economic risk management strategy, to fix the amount of certain foreign assets and obligations relative to its functional and reporting currency (the U.S. dollar) or relative to the functional currency of certain of its consolidated subsidiaries, or to add stability to cash flows resulting from its net investments (including intercompany notes not permanently invested) and earnings denominated in foreign currencies. The Company’s foreign currency exposures at times offset each other, sometimes providing a natural hedge against its foreign currency risk. In connection with the remaining foreign currency risk, the Company uses foreign exchange contracts to effectively fix the foreign currency exchange rate applicable to specific anticipated foreign currency-denominated cash flows, thus limiting the potential fluctuations in such cash flows as a result of foreign currency market movements. The Company from time to time has used interest rate swaps, as part of its overall economic risk management strategy, to add stability to the interest payments due in connection with its debt obligations. At June 30, 2016, our exposure to interest rate fluctuations relates to interest payments under the ABL facility, if any, and the Company held no derivative instruments in connection therewith. As of June 30, 2016, the Company did not purchase or hold any derivative instruments for trading or speculative purposes. Designated Cash Flow Hedges The Company may use from time to time derivative instruments designated as hedges to manage its exposure to interest rate or foreign currency exchange rate movements, as appropriate. However, at June 30, 2016, the Company did not purchase or hold any such derivatives. Non-designated Cash Flow Hedges The Company may use from time to time derivative instruments (such as foreign exchange contracts and interest rate swaps) not designated as hedges or that do not meet the requirements for hedge accounting, to manage its exposure to interest rate or foreign currency exchange rate movements, as appropriate. The Company uses foreign exchange contracts to manage the exposure to the U.S. dollar resulting from certain of its Sinelco Group subsidiaries’ purchases of merchandise from third-party suppliers. Sinelco’s functional currency is the Euro. As such, at June 30, 2016, we hold foreign currency forwards which enable us to sell approximately €3.2 million ($3.5 million, at the June 30, 2016 exchange rate) at the weighted average contractual exchange rate of 1.1290. The foreign currency forwards discussed in this paragraph are with a single counterparty and expire ratably through September 15, 2016. The Company also uses foreign exchange contracts to mitigate its exposure to changes in foreign currency exchange rates in connection with certain intercompany balances not permanently invested. As such, at June 30, 2016, we hold: (a) a foreign currency forward which enables us to sell approximately €22.2 million ($24.7 million, at the June 30, 2016 exchange rate) at the contractual exchange rate of 1.1107, (b) a foreign currency forward which enables us to sell approximately $7.9 million Canadian dollars ($6.1 million, at the June 30, 2016 exchange rate) at the contractual exchange rate of 1.3001, (c) a foreign currency forward which enables us to buy approximately $11.2 million Canadian dollars ($8.7 million, at the June 30, 2016 exchange rate) at the contractual exchange rate of 1.3036, (d) a foreign currency forward which enables us to sell approximately 28.9 million Mexican pesos ($1.6 million, at the June 30, 2016 exchange rate) at the contractual exchange rate of 18.6220, and (e) a foreign currency forward which enables us to buy approximately £7.2 million ($9.6 million, at the June 30, 2016 exchange rate) at the contractual exchange rate of 1.3357. All the foreign currency forwards discussed in this paragraph are with a single counterparty (not the same counterparty as that on the forwards discussed in the preceding paragraph) and expire on or before September 30, 2016. The Company’s foreign exchange contracts are not designated as hedges and do not currently meet the requirements for hedge accounting. Accordingly, the changes in the fair value (i.e., marked-to-market adjustments) of these derivative instruments, which are adjusted quarterly, are recorded in selling, general and administrative expenses in our consolidated statements of earnings. Selling, general and administrative expenses reflect a net gain of $0.2 million and a net loss of $1.0 million for the three months ended June 30, 2016 and 2015, respectively, and, for the nine months ended June 30, 2016 and 2015, a net loss of $0.4 million and a net gain of $4.0 million, respectively, in connection with all of the Company’s foreign currency derivative instruments, including marked-to-market adjustments . The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Company’s consolidated balance sheets as of June 30, 2016 and September 30, 2015 (in thousands): Asset Derivatives Liability Derivatives Classification June 30, 2016 September 30, 2015 Classification June 30, 2016 September 30, 2015 Derivatives designated as hedging instruments: None Derivatives not designated as hedging instruments: Foreign exchange contracts Other current assets $ $ Accrued liabilities $ $ $ $ $ $ The table below presents the effect of the Company’s derivative financial instruments on the Company’s consolidated statements of earnings for the three months ended June 30, 2016 and 2015 (in thousands): Derivatives Designated as Hedging Instruments Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion), net of tax Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) None Classification of Gain or Amount of Gain or (Loss) Recognized in Income on Derivatives Derivatives Not Designated as (Loss) Recognized into Three Months Ended June 30, Hedging Instruments Income 2016 2015 Foreign exchange contracts Selling, general and administrative expenses $ $ ) The table below presents the effect of the Company’s derivative financial instruments on the Company’s consolidated statements of earnings for the nine months ended June 30, 2016 and 2015 (in thousands): Derivatives Designated as Hedging Instruments Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion), net of tax Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) None Classification of Gain or Amount of Gain or (Loss) Recognized in Income on Derivatives Derivatives Not Designated as (Loss) Recognized into Nine Months Ended June 30, Hedging Instruments Income 2016 2015 Foreign exchange contracts Selling, general and administrative expenses $ ) $ Credit-risk-related Contingent Features At June 30, 2016, the aggregate fair value of all foreign exchange contracts held which consisted of derivative instruments in a liability position was $0.1 million . The Company was under no obligation to post and had not posted any collateral related to the agreements in a liability position. The counterparties to our derivative instruments are deemed by the Company to be of substantial resources and strong creditworthiness. However, these transactions result in exposure to credit risk in the event of default by a counterparty. For example, the financial crisis that has affected the global banking systems and financial markets in 2007-2009 resulted in many well-known financial institutions becoming less creditworthy or having diminished liquidity which could expose us to an increased level of counterparty credit risk. In the event that a counterparty defaults in its obligation under our derivative instruments, we could incur substantial financial losses. However, at the present time, no such losses are deemed probable.

Business Segments

Business Segments	9 Months Ended
	Jun. 30, 2016
Business Segments
Business Segments	12. Business Segments The Company’s business is organized into two separate segments: (i) Sally Beauty Supply, a domestic and international chain of cash and carry retail stores which offers professional beauty supplies to both salon professionals and retail customers primarily in North America, Puerto Rico, and parts of Europe and South America and (ii) BSG, including its franchise-based business Armstrong McCall, a full service beauty supply distributor which offers professional brands of beauty products directly to salons and salon professionals through its own sales force and professional-only stores (including franchise stores) in partially exclusive geographical territories in North America and parts of Europe. The accounting policies of both of our business segments are the same as described in the summary of significant accounting policies contained in Note 2 of the “Notes to Consolidated Financial Statements” in “Item 8 - Financial Statements and Supplementary Data” contained in our Annual Report on Form 10-K for the fiscal year ended September 30, 2015. Sales between segments, which were eliminated in consolidation, were not material during the three and nine months ended June 30, 2016 and 2015. Segment data for the three and nine months ended June 30, 2016 and 2015 is as follows (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2016 2015 2016 2015 Net sales: Sally Beauty Supply $ $ $ $ BSG Total $ $ $ $ Earnings before provision for income taxes: Segment operating profit: Sally Beauty Supply $ $ $ $ BSG Segment operating profit Unallocated expenses (a) ) ) ) ) Share-based compensation expense ) ) ) ) Interest expense (b) ) ) ) ) Earnings before provision for income taxes $ $ $ $ (a) Unallocated expenses consist of corporate and shared costs. (b) For the nine months ended June 30, 2016, interest expense includes a loss on extinguishment of debt of $33.3 million in connection with the Company’s December 2015 redemption of its senior notes due 2019.

Parent, Issuers, Guarantor and

Parent, Issuers, Guarantor and Non-Guarantor Condensed Consolidated Financial Statements	9 Months Ended
	Jun. 30, 2016
Parent, Issuers, Guarantor and Non-Guarantor Condensed Consolidated Financial Statements
Parent, Issuers, Guarantor and Non-Guarantor Condensed Consolidated Financial Statements	13. Parent, Issuers, Guarantor and Non-Guarantor Condensed Consolidated Financial Statements The following consolidating financial information presents the condensed consolidating balance sheets as of June 30, 2016 and September 30, 2015, and the related condensed consolidating statements of earnings and condensed consolidating statements of comprehensive income for the three and nine months ended June 30, 2016 and 2015, and condensed consolidating statements of cash flows for the nine months ended June 30, 2016 and 2015: (i) Sally Beauty Holdings, Inc., or the “Parent;” (ii) Sally Holdings LLC and Sally Capital Inc., or the “Issuers;” (iii) the guarantor subsidiaries; (iv) the non-guarantor subsidiaries; (v) elimination entries necessary for consolidation purposes; and (vi) Sally Beauty on a consolidated basis. Investments in subsidiaries are accounted for using the equity method for purposes of the consolidating financial information presented below. The principal elimination entries relate to investments in subsidiaries and intercompany balances and transactions. Separate financial statements and other disclosures with respect to the subsidiary guarantors have not been provided as management believes the following information is sufficient, as guarantor subsidiaries are 100% indirectly owned by the Parent and all guarantees are full and unconditional. Additionally, the accounts, inventory, credit card receivables, deposit accounts, certain intercompany notes and certain other personal property of the guarantor subsidiaries relating to the inventory and accounts are pledged under the ABL facility and consequently may not be available to satisfy the claims of general creditors . Condensed Consolidating Balance Sheet June 30, 2016 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Assets Cash and cash equivalents $ — $ — $ $ $ — $ Trade and other accounts receivable, less allowance for doubtful accounts — — — Due from affiliates — — ) — Inventory — — — Other current assets — Deferred income tax assets — — Property and equipment, net — — Investment in subsidiaries — ) — Goodwill and other intangible assets, net — — — Other assets ) — Total assets $ $ $ $ $ ) $ Liabilities and Stockholders’ (Deficit) Equity Accounts payable $ — $ — $ $ $ — $ Due to affiliates ) — Accrued liabilities — Income taxes payable — ) — Long-term debt — — Other liabilities — — — Deferred income tax liabilities — — Total liabilities ) Total stockholders’ (deficit) equity ) ) ) Total liabilities and stockholders’ (deficit) equity $ $ $ $ $ ) $ Condensed Consolidating Balance Sheet September 30, 2015 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Assets Cash and cash equivalents $ — $ $ $ $ — $ Trade and other accounts receivable, less allowance for doubtful accounts — — — Due from affiliates — — ) — Inventory — — — Other current assets — Deferred income tax assets — — Property and equipment, net — — Investment in subsidiaries — ) — Goodwill and other intangible assets, net — — — Other assets ) — Total assets $ $ $ $ $ ) $ Liabilities and Stockholders’ (Deficit) Equity Accounts payable $ — $ — $ $ $ — $ Due to affiliates ) — Accrued liabilities — Income taxes payable — — Long-term debt — — Other liabilities — — — Deferred income tax liabilities — — Total liabilities ) Total stockholders’ (deficit) equity ) ) ) Total liabilities and stockholders’ (deficit) equity $ $ $ $ $ ) $ Condensed Consolidating Statement of Earnings and Comprehensive Income Three Months Ended June 30, 2016 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non- Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Net sales $ — $ — $ $ $ — $ Related party sales — — — ) — Cost of products sold and distribution expenses — — ) Gross profit — — — Selling, general and administrative expenses — Depreciation and amortization — — Operating earnings (loss) ) ) — Interest expense (income) — ) — Earnings (loss) before provision for income taxes ) ) — Provision (benefit) for income taxes ) ) — Equity in earnings of subsidiaries, net of tax — ) — Net earnings ) Other comprehensive income (loss), net of tax — — — ) — ) Total comprehensive income (loss) $ $ $ $ ) $ ) $ Condensed Consolidating Statement of Earnings and Comprehensive Income Three Months Ended June 30, 2015 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non- Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Net sales $ — $ — $ $ $ — $ Related party sales — — — ) — Cost of products sold and distribution expenses — — ) Gross profit — — — Selling, general and administrative expenses — Depreciation and amortization — — Operating earnings (loss) ) ) — Interest expense — — — Earnings (loss) before provision for income taxes ) ) — Provision (benefit) for income taxes ) ) — Equity in earnings of subsidiaries, net of tax — ) — Net earnings ) Other comprehensive income, net of tax — — — — Total comprehensive income (loss) $ $ $ $ $ ) $ Condensed Consolidating Statement of Earnings and Comprehensive Income Nine Months Ended June 30, 2016 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Net sales $ — $ — $ $ $ — $ Related party sales — — — ) — Cost of products sold and distribution expenses — — ) Gross profit — — — Selling, general and administrative expenses — Depreciation and amortization — — Operating earnings (loss) ) ) — Interest expense (income) — ) — Earnings (loss) before provision for income taxes ) ) — Provision (benefit) for income taxes ) ) — Equity in earnings of subsidiaries, net of tax — ) — Net earnings ) Other comprehensive income (loss), net of tax — — — ) — ) Total comprehensive income (loss) $ $ $ $ ) $ ) $ Condensed Consolidating Statement of Earnings and Comprehensive Income Nine Months Ended June 30, 2015 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non- Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Net sales $ — $ — $ $ $ — $ Related party sales — — — ) — Cost of products sold and distribution expenses — — ) Gross profit — — — Selling, general and administrative expenses — Depreciation and amortization — — Operating earnings (loss) ) ) — Interest expense — — Earnings (loss) before provision for income taxes ) ) — Provision (benefit) for income taxes ) ) — Equity in earnings of subsidiaries, net of tax — ) — Net earnings ) Other comprehensive income (loss), net of tax — — — ) — ) Total comprehensive income (loss) $ $ $ $ ) $ ) $ Condensed Consolidating Statement of Cash Flows Nine months ended June 30, 2016 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non- Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Net cash provided (used) by operating activities $ $ ) $ $ $ — $ Cash Flows from Investing Activities: Capital expenditures, net of proceeds from sale of property and equipment ) — ) ) — ) Acquisitions, net of cash acquired — — ) — — ) Net cash used by investing activities ) — ) ) — ) Cash Flows from Financing Activities: Proceeds from issuance of long-term debt — — — — Repayments of long-term debt — ) ) ) — ) Repurchases of common stock ) — — — — ) Debt issuance costs — ) — — — ) Proceeds from exercises of stock options — — — — Excess tax benefit from share-based compensation — — — — Net cash used by financing activities ) ) ) ) — ) Effect of foreign exchange rate changes on cash and cash equivalents — — — ) — ) Net decrease in cash and cash equivalents — ) ) ) — ) Cash and cash equivalents, beginning of period — — Cash and cash equivalents, end of period $ — $ — $ $ $ — $ Condensed Consolidating Statement of Cash Flows Nine months ended June 30, 2015 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non- Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Net cash (used) provided by operating activities $ ) $ $ $ $ — $ Cash Flows from Investing Activities: Capital expenditures ) — ) ) — ) Acquisitions, net of cash acquired — — ) ) — ) Net cash used by investing activities ) — ) ) — ) Cash Flows from Financing Activities: Proceeds from issuance of long-term debt — — — Repayments of long-term debt — — ) ) — ) Repurchases of common stock ) — — — — ) Proceeds from exercises of stock options — — — — Excess tax benefit from share-based compensation — — — — Net cash provided (used) by financing activities — ) ) — Effect of foreign exchange rate changes on cash and cash equivalents — — — ) — ) Net increase (decrease) in cash and cash equivalents — ) — Cash and cash equivalents, beginning of period — — Cash and cash equivalents, end of period $ — $ $ $ $ — $

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	9 Months Ended
	Jun. 30, 2016
Fair Value Measurements
Schedule of financial assets and liabilities by fair value hierarchy	As of June 30, 2016 Total Level 1 Level 2 Level 3 Assets Foreign exchange contracts (b) $ $ — $ — Total assets $ $ — $ — Liabilities Long-term debt (c) $ $ $ — Foreign exchange contracts (b) — — Total liabilities $ $ $ — As of September 30, 2015 Total Level 1 Level 2 Level 3 Assets Cash equivalents (a) $ $ $ — — Foreign exchange contracts (b) — — Total assets $ $ $ — Liabilities Long-term debt (c) $ $ $ — Foreign exchange contracts (b) — — Total liabilities $ $ $ — (a) Cash equivalents consist of highly liquid investments which have no maturity and are valued using unadjusted quoted market prices for such securities. The Company may from time to time invest in securities with maturities of three months or less (consisting primarily of investment-grade corporate and government bonds), with the primary investment objective of minimizing the potential risk of loss of principal. (b) Foreign exchange contracts (including foreign currency forwards and options) are valued for purposes of this disclosure using widely accepted valuation techniques, such as discounted cash flow analyses, and observable inputs, such as market foreign currency exchange rates. Please see Note 11 for more information about the Company’s foreign exchange contracts. (c) Long-term debt (including current maturities and borrowings under the ABL facility, if any) is carried in the Company’s consolidated financial statements at amortized cost of $1,808.1 million at June 30, 2016 and $1,809.4 million at September 30, 2015, less unamortized debt issuance costs of $24.5 million and $21.8 million at June 30, 2016 and September 30, 2015, respectively. The Company’s senior notes are valued for purposes of this disclosure using unadjusted quoted market prices for such debt securities. Other long-term debt (consisting primarily of borrowings under the ABL facility, if any, and capital lease obligations) is generally valued for purposes of this disclosure using widely accepted valuation techniques, such as discounted cash flow analyses, and observable inputs, such as market interest rates. Please see Note 10 for more information about the Company’s debt.

Earnings Per Share (Tables)

Earnings Per Share (Tables)	9 Months Ended
	Jun. 30, 2016
Earnings Per Share
Schedule of computations of basic and diluted earnings per share	Three Months Ended June 30, Nine Months Ended June 30, 2016 2015 2016 2015 Net earnings $ $ $ $ Total weighted average basic shares Dilutive securities: Stock options and stock awards Total weighted average diluted shares Earnings per share: Basic $ $ $ $ Diluted $ $ $ $

Share-Based Payments (Tables)

Share-Based Payments (Tables)	9 Months Ended
	Jun. 30, 2016
Share-Based Payments
Schedule of total compensation cost charged against income	Three Months Ended June 30, Nine Months Ended June 30, 2016 2015 2016 2015 Share-based compensation expense $ $ $ $ Income tax benefit related to share-based compensation expense $ $ $ $
Summary of activity for performance based unit awards	Performance Unit Awards Number of Shares (in Thousands) Weighted Average Fair Value Per Share Weighted Average Remaining Vesting Term (in Years) Unvested at September 30, 2015 — $ — — Granted Vested — — Forfeited ) Unvested at June 30, 2016 $
Summary of activity for stock option awards	Number of Outstanding Options (in Thousands) Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in Years) Aggregate Intrinsic Value (in Thousands) Outstanding at September 30, 2015 $ $ Granted Exercised ) Forfeited or expired ) Outstanding at June 30, 2016 $ $ Exercisable at June 30, 2016 $ $
Summary of stock options by range of exercise prices	The following table summarizes additional information about service-based stock options outstanding at June 30, 2016 under the Company’s share-based compensation plans: Options Outstanding Options Exercisable Range of Exercise Prices Number of Options Outstanding (in Thousands) Weighted Average Remaining Contractual Term (in Years) Weighted Average Exercise Price Number of Options Exercisable (in Thousands) Weighted Average Exercise Price $5.24 – 19.99 $ $ $20.00–31.58 Total $ $
Schedule of weighted average assumptions for valuation of stock options	Nine Months Ended June 30, 2016 2015 Expected life (in years) Expected volatility for the Company’s common stock % % Risk-free interest rate % % Dividend yield % %
Restricted Stock Awards
Share-Based Payments
Summary of the activity for restricted stock awards/units	Restricted Stock Awards Number of Shares (in Thousands) Weighted Average Fair Value Per Share Weighted Average Remaining Vesting Term (in Years) Unvested at September 30, 2015 $ Granted Vested ) Forfeited ) Unvested at June 30, 2016 $
Restricted Stock Units
Share-Based Payments
Summary of the activity for restricted stock awards/units	Restricted Stock Units Number of Shares (in Thousands) Weighted Average Fair Value Per Share Weighted Average Remaining Vesting Term (in Years) Unvested at September 30, 2015 — $ — — Granted Vested — — Forfeited — — Unvested at June 30, 2016 $

Short-term Borrowings and Lon24

Short-term Borrowings and Long-term Debt (Tables)	9 Months Ended
	Jun. 30, 2016
Short-term Borrowings and Long-term Debt
Summary of long-term debt	June 30, 2016 September 30, 2015 Interest Rates(a) ABL facility(b) $ — $ — (i) Prime plus (0.50% to 0.75%) or; (ii) LIBOR(b) plus (1.50% to 1.75%) Senior notes due Nov. 2019 — 6.875% Senior notes due Jun. 2022 5.750% Senior notes due Nov. 2023 5.500% Senior notes due Dec. 2025 — 5.625% Total $ $ Plus: capital lease obligations Less: unamortized debt issuance costs and premium, net(c) Total debt $ $ Less: current maturities Total long-term debt $ $ (a) Interest rates shown represent the coupon or contractual rates related to each debt instrument listed. (b) When used in this Quarterly Report, LIBOR means the London Interbank Offered Rate. At June 30, 2016 and September 30, 2015, unamortized debt issuance costs of $1.8 million and $2.4 million, respectively, related to the ABL facility are reported in other assets in the Company’s consolidated balance sheets. (c) Amounts are net of unamortized premium of $5.8 million and $6.5 million as of June 30, 2016 and September 30, 2015, respectively, related to certain notes with an aggregate principal amount of $150.0 million.
Schedule of maturities of long-term debt	Twelve months ending June 30: 2017-2021 $ — Thereafter $ Plus: capital lease obligations Less: unamortized debt issuance costs and premium, net Less: current maturities Total long-term debt $

Derivative Instruments and He25

Derivative Instruments and Hedging Activities (Tables)	9 Months Ended
	Jun. 30, 2016
Derivative Instruments and Hedging Activities
Tabular disclosure of fair values of derivative instruments	Asset Derivatives Liability Derivatives Classification June 30, 2016 September 30, 2015 Classification June 30, 2016 September 30, 2015 Derivatives designated as hedging instruments: None Derivatives not designated as hedging instruments: Foreign exchange contracts Other current assets $ $ Accrued liabilities $ $ $ $ $ $
Tabular disclosure of the effect of derivative instruments on the statement of earnings	Derivatives Designated as Hedging Instruments Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion), net of tax Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) None Classification of Gain or Amount of Gain or (Loss) Recognized in Income on Derivatives Derivatives Not Designated as (Loss) Recognized into Three Months Ended June 30, Hedging Instruments Income 2016 2015 Foreign exchange contracts Selling, general and administrative expenses $ $ ) Derivatives Designated as Hedging Instruments Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion), net of tax Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) None Classification of Gain or Amount of Gain or (Loss) Recognized in Income on Derivatives Derivatives Not Designated as (Loss) Recognized into Nine Months Ended June 30, Hedging Instruments Income 2016 2015 Foreign exchange contracts Selling, general and administrative expenses $ ) $

Business Segments (Tables)

Business Segments (Tables)	9 Months Ended
	Jun. 30, 2016
Business Segments
Schedule of segment data	Segment data for the three and nine months ended June 30, 2016 and 2015 is as follows (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2016 2015 2016 2015 Net sales: Sally Beauty Supply $ $ $ $ BSG Total $ $ $ $ Earnings before provision for income taxes: Segment operating profit: Sally Beauty Supply $ $ $ $ BSG Segment operating profit Unallocated expenses (a) ) ) ) ) Share-based compensation expense ) ) ) ) Interest expense (b) ) ) ) ) Earnings before provision for income taxes $ $ $ $ (a) Unallocated expenses consist of corporate and shared costs. (b) For the nine months ended June 30, 2016, interest expense includes a loss on extinguishment of debt of $33.3 million in connection with the Company’s December 2015 redemption of its senior notes due 2019.

Parent, Issuers, Guarantor an27

Parent, Issuers, Guarantor and Non-Guarantor Condensed Consolidated Financial Statements (Tables)	9 Months Ended
	Jun. 30, 2016
Parent, Issuers, Guarantor and Non-Guarantor Condensed Consolidated Financial Statements
Schedule of Condensed Consolidating Balance Sheet	Condensed Consolidating Balance Sheet June 30, 2016 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Assets Cash and cash equivalents $ — $ — $ $ $ — $ Trade and other accounts receivable, less allowance for doubtful accounts — — — Due from affiliates — — ) — Inventory — — — Other current assets — Deferred income tax assets — — Property and equipment, net — — Investment in subsidiaries — ) — Goodwill and other intangible assets, net — — — Other assets ) — Total assets $ $ $ $ $ ) $ Liabilities and Stockholders’ (Deficit) Equity Accounts payable $ — $ — $ $ $ — $ Due to affiliates ) — Accrued liabilities — Income taxes payable — ) — Long-term debt — — Other liabilities — — — Deferred income tax liabilities — — Total liabilities ) Total stockholders’ (deficit) equity ) ) ) Total liabilities and stockholders’ (deficit) equity $ $ $ $ $ ) $ Condensed Consolidating Balance Sheet September 30, 2015 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Assets Cash and cash equivalents $ — $ $ $ $ — $ Trade and other accounts receivable, less allowance for doubtful accounts — — — Due from affiliates — — ) — Inventory — — — Other current assets — Deferred income tax assets — — Property and equipment, net — — Investment in subsidiaries — ) — Goodwill and other intangible assets, net — — — Other assets ) — Total assets $ $ $ $ $ ) $ Liabilities and Stockholders’ (Deficit) Equity Accounts payable $ — $ — $ $ $ — $ Due to affiliates ) — Accrued liabilities — Income taxes payable — — Long-term debt — — Other liabilities — — — Deferred income tax liabilities — — Total liabilities ) Total stockholders’ (deficit) equity ) ) ) Total liabilities and stockholders’ (deficit) equity $ $ $ $ $ ) $
Schedule of Condensed Consolidating Statement of Earnings and Comprehensive Income	Condensed Consolidating Statement of Earnings and Comprehensive Income Three Months Ended June 30, 2016 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non- Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Net sales $ — $ — $ $ $ — $ Related party sales — — — ) — Cost of products sold and distribution expenses — — ) Gross profit — — — Selling, general and administrative expenses — Depreciation and amortization — — Operating earnings (loss) ) ) — Interest expense (income) — ) — Earnings (loss) before provision for income taxes ) ) — Provision (benefit) for income taxes ) ) — Equity in earnings of subsidiaries, net of tax — ) — Net earnings ) Other comprehensive income (loss), net of tax — — — ) — ) Total comprehensive income (loss) $ $ $ $ ) $ ) $ Condensed Consolidating Statement of Earnings and Comprehensive Income Three Months Ended June 30, 2015 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non- Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Net sales $ — $ — $ $ $ — $ Related party sales — — — ) — Cost of products sold and distribution expenses — — ) Gross profit — — — Selling, general and administrative expenses — Depreciation and amortization — — Operating earnings (loss) ) ) — Interest expense — — — Earnings (loss) before provision for income taxes ) ) — Provision (benefit) for income taxes ) ) — Equity in earnings of subsidiaries, net of tax — ) — Net earnings ) Other comprehensive income, net of tax — — — — Total comprehensive income (loss) $ $ $ $ $ ) $ Condensed Consolidating Statement of Earnings and Comprehensive Income Nine Months Ended June 30, 2016 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Net sales $ — $ — $ $ $ — $ Related party sales — — — ) — Cost of products sold and distribution expenses — — ) Gross profit — — — Selling, general and administrative expenses — Depreciation and amortization — — Operating earnings (loss) ) ) — Interest expense (income) — ) — Earnings (loss) before provision for income taxes ) ) — Provision (benefit) for income taxes ) ) — Equity in earnings of subsidiaries, net of tax — ) — Net earnings ) Other comprehensive income (loss), net of tax — — — ) — ) Total comprehensive income (loss) $ $ $ $ ) $ ) $ Condensed Consolidating Statement of Earnings and Comprehensive Income Nine Months Ended June 30, 2015 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non- Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Net sales $ — $ — $ $ $ — $ Related party sales — — — ) — Cost of products sold and distribution expenses — — ) Gross profit — — — Selling, general and administrative expenses — Depreciation and amortization — — Operating earnings (loss) ) ) — Interest expense — — Earnings (loss) before provision for income taxes ) ) — Provision (benefit) for income taxes ) ) — Equity in earnings of subsidiaries, net of tax — ) — Net earnings ) Other comprehensive income (loss), net of tax — — — ) — ) Total comprehensive income (loss) $ $ $ $ ) $ ) $
Schedule of Condensed Consolidating Statement of Cash Flows	Condensed Consolidating Statement of Cash Flows Nine months ended June 30, 2016 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non- Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Net cash provided (used) by operating activities $ $ ) $ $ $ — $ Cash Flows from Investing Activities: Capital expenditures, net of proceeds from sale of property and equipment ) — ) ) — ) Acquisitions, net of cash acquired — — ) — — ) Net cash used by investing activities ) — ) ) — ) Cash Flows from Financing Activities: Proceeds from issuance of long-term debt — — — — Repayments of long-term debt — ) ) ) — ) Repurchases of common stock ) — — — — ) Debt issuance costs — ) — — — ) Proceeds from exercises of stock options — — — — Excess tax benefit from share-based compensation — — — — Net cash used by financing activities ) ) ) ) — ) Effect of foreign exchange rate changes on cash and cash equivalents — — — ) — ) Net decrease in cash and cash equivalents — ) ) ) — ) Cash and cash equivalents, beginning of period — — Cash and cash equivalents, end of period $ — $ — $ $ $ — $ Condensed Consolidating Statement of Cash Flows Nine months ended June 30, 2015 (In thousands) Parent Sally Holdings LLC and Sally Capital Inc. Guarantor Subsidiaries Non- Guarantor Subsidiaries Consolidating Eliminations Sally Beauty Holdings, Inc. and Subsidiaries Net cash (used) provided by operating activities $ ) $ $ $ $ — $ Cash Flows from Investing Activities: Capital expenditures ) — ) ) — ) Acquisitions, net of cash acquired — — ) ) — ) Net cash used by investing activities ) — ) ) — ) Cash Flows from Financing Activities: Proceeds from issuance of long-term debt — — — Repayments of long-term debt — — ) ) — ) Repurchases of common stock ) — — — — ) Proceeds from exercises of stock options — — — — Excess tax benefit from share-based compensation — — — — Net cash provided (used) by financing activities — ) ) — Effect of foreign exchange rate changes on cash and cash equivalents — — — ) — ) Net increase (decrease) in cash and cash equivalents — ) — Cash and cash equivalents, beginning of period — — Cash and cash equivalents, end of period $ — $ $ $ $ — $

Fair Value Measurements (Detail

Fair Value Measurements (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Sep. 30, 2015
Liabilities
Long-term debt	$ 1,800,000	$ 1,800,000
Unamortized debt issuance costs	18,688	15,276
Fair value measurement on recurring basis | Total
Assets
Cash equivalents (a)		46,003
Total assets	132	46,325
Liabilities
Long-term debt (c)	1,876,292	1,873,620
Total liabilities	1,876,429	1,873,678
Foreign exchange contracts | Fair value measurement on recurring basis | Total
Assets
Foreign exchange contracts (b)	132	322
Liabilities
Foreign exchange contracts (b)	137	58
Level 1 | Fair value measurement on recurring basis
Assets
Cash equivalents (a)		46,003
Total assets		46,003
Liabilities
Long-term debt (c)	1,874,000	1,870,750
Total liabilities	1,874,000	1,870,750
Level 2 | Fair value measurement on recurring basis
Assets
Total assets	132	322
Liabilities
Long-term debt (c)	2,292	2,870
Total liabilities	2,429	2,928
Level 2 | Foreign exchange contracts | Fair value measurement on recurring basis
Assets
Foreign exchange contracts (b)	132	322
Liabilities
Foreign exchange contracts (b)	137	58
ABL facility
Liabilities
Long-term debt	1,808,100	1,809,400
Unamortized debt issuance costs	$ 24,500	$ 21,800

Accumulated Stockholders' Equ29

Accumulated Stockholders' Equity (Deficit) - Share Repurchase Program (Details) - 2014 Share Repurchase Program - USD ($) shares in Millions, $ in Millions	1 Months Ended	9 Months Ended
	Aug. 31, 2014	Jun. 30, 2016	Jun. 30, 2015
Share repurchase program
Amount of shares authorized to be repurchased	$ 1,000
Term of share repurchase program	3 years
Common stock shares repurchased and retired (in shares)		6.2	2.3
Cost of repurchase and retirement of common stock		$ 162.4	$ 74.3

Accumulated Stockholders' Equ30

Accumulated Stockholders' Equity (Deficit) - Accumulated other comprehensive loss (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Sep. 30, 2015
Accumulated Stockholders' Equity (Deficit)
Accumulated other comprehensive loss	$ 93,896	$ 77,705
Foreign currency translation adjustments
Accumulated Stockholders' Equity (Deficit)
Accumulated other comprehensive loss	93,900	77,700
Income taxes on accumulated other comprehensive loss	$ 2,300	$ 2,300

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Earnings Per Share Reconciliation:
Net earnings	$ 67,919	$ 62,463	$ 170,321	$ 178,907
Total weighted average basic shares	145,957,000	157,110,000	147,741,000	156,901,000
Dilutive securities:
Stock option and stock awards (in shares)	1,880,000	2,010,000	1,735,000	1,974,000
Total weighted average diluted shares	147,837,000	159,120,000	149,476,000	158,875,000
Earnings per share:
Basic (in dollars per share)	$ 0.47	$ 0.40	$ 1.15	$ 1.14
Diluted (in dollars per share)	$ 0.46	$ 0.39	$ 1.14	$ 1.13
Common stock potentially outstanding but not included in the computation of diluted earnings per share
Options to purchase shares not included in the computation of diluted earnings per share since the options were anti-dilutive (in shares)	66,573	33,592	1,094,343	1,091,466

Share-Based Payments (Details)

Share-Based Payments (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Share-Based Payments
Share-based compensation expense (in dollars)	$ 2,838	$ 2,866	$ 10,011	$ 13,466
Income tax benefit related to share-based compensation expense (in dollars)	$ 1,062	$ 1,075	$ 3,769	$ 5,070

Share-Based Payments - Performa

Share-Based Payments - Performance-Based Unit Awards (Details) - Performance Shares $ / shares in Units, $ in Millions	9 Months Ended
	Jun. 30, 2016USD ($)item$ / sharesshares
Share-Based Payments
Vesting period	3 years
Expected life (in years)	3 years
Number of performance targets | item	2
Compensation expenses as percentage of performance target (as a percent)	100.00%
Performance-Based Unit Awards (in shares)
Granted (in shares) | shares	152,000
Forfeited (in shares) | shares	(6,000)
Unvested at the end of the period (in shares) | shares	146,000
Performance-Based Unit Awards (in dollars per share)
Granted (in dollars per share) | $ / shares	$ 23.45
Forfeited (in dollars per share) | $ / shares	23.45
Unvested at the end of the period (in dollars per share) | $ / shares	$ 23.45
Performance-Based Unit Awards (in years)
Weighted average remaining vested term (in years)	2 years 2 months 12 days
Total unrecognized compensation costs related to unvested stock option awards | $	$ 2.5
Weighted average period for recognition of unvested awards	2 years 2 months 12 days
Consolidated sales growth
Share-Based Payments
Vesting Percentage	40.00%
Return on invested capital target
Share-Based Payments
Vesting Percentage	60.00%
Minimum
Share-Based Payments
Percentage of target shares	0.00%
Maximum
Share-Based Payments
Percentage of target shares	200.00%

Share-Based Payments - Service-

Share-Based Payments - Service-Based Awards (Details) - USD ($) $ in Millions	9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Share-Based Payments
Accelerated expense related to certain retirement eligible employees (in dollars)	$ 1.3	$ 4.8
Service Based Stock Options Member
Share-Based Payments
Granted (in shares)	1,500,000	1,200,000
Service Based Restricted Share Awards Member
Share-Based Payments
Granted (in shares)	40,000	219,000
Service Based Restricted Stock Units Member
Share-Based Payments
Granted (in shares)	27,000	20,000

Share-Based Payments - Stock Op

Share-Based Payments - Stock Option Awards (Details) - Stock Option Awards - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	9 Months Ended	12 Months Ended
	Jun. 30, 2016	Sep. 30, 2015
Stock Options, Number of Outstanding Options
Outstanding at the beginning of the period (in shares)	5,316
Granted (in shares)	1,486
Exercised (in shares)	(763)
Forfeited or expired (in shares)	(131)
Outstanding at the end of the period (in shares)	5,908	5,316
Exercisable at the end of the period (in shares)	2,707
Stock Options, Weighted Average Exercise Price
Outstanding at the beginning of the period (in dollars per share)	$ 21.89
Granted (in dollars per share)	23.65
Exercised (in dollars per share)	17.13
Forfeited or expired (in dollars per share)	26.16
Outstanding at the end of the period (in dollars per share)	22.85	$ 21.89
Exercisable at the end of the period (in dollars per share)	$ 19.71
Stock Options, Weighted Average Remaining Contractual Term
Weighted average remaining contractual term (in years)	6 years 3 months 18 days	6 years 9 months 18 days
Exercisable at the end of the period	4 years 10 months 24 days
Stock Options, Aggregate Intrinsic Value
Outstanding at the beginning of the period (in dollars)	$ 19,255
Outstanding at the end of the period (in dollars)	38,743	$ 19,255
Exercisable at the end of the period (in dollars)	$ 26,273
Minimum
Share-Based Payments
Vesting period	3 years
Maximum
Share-Based Payments
Term of stock options	10 years
Vesting period	4 years

Share-Based Payments - Summary

Share-Based Payments - Summary of stock options by range of exercise prices (Details) shares in Thousands	9 Months Ended
	Jun. 30, 2016$ / sharesshares
Options Outstanding
Range of Exercise Prices, Number of Options Outstanding (in shares) | shares	5,908
Range of Exercise Prices, Weighted Average Remaining Contractual Term	6 years 3 months 18 days
Range of Exercise Prices, Weighted Average Exercise Price (in dollars per share)	$ 22.85
Options Exercisable
Range of Exercise Prices, Number of Options Exercisable (in shares) | shares	2,707
Range of Exercise Prices, Weighted Average Exercise Price (in dollars per share)	$ 19.71
Range of Exercise Prices $5.24 - 19.99
Information about stock options under option plans
Lower Range of Exercise Prices (in dollars per share)	5.24
Upper Range of Exercise Prices (in dollars per share)	$ 19.99
Options Outstanding
Range of Exercise Prices, Number of Options Outstanding (in shares) | shares	1,309
Range of Exercise Prices, Weighted Average Remaining Contractual Term	3 years 9 months 18 days
Range of Exercise Prices, Weighted Average Exercise Price (in dollars per share)	$ 13.21
Options Exercisable
Range of Exercise Prices, Number of Options Exercisable (in shares) | shares	1,309
Range of Exercise Prices, Weighted Average Exercise Price (in dollars per share)	$ 13.21
Range of Exercise Prices $20.00 - 31.58
Information about stock options under option plans
Lower Range of Exercise Prices (in dollars per share)	20
Upper Range of Exercise Prices (in dollars per share)	$ 31.58
Options Outstanding
Range of Exercise Prices, Number of Options Outstanding (in shares) | shares	4,599
Range of Exercise Prices, Weighted Average Remaining Contractual Term	7 years
Range of Exercise Prices, Weighted Average Exercise Price (in dollars per share)	$ 25.60
Options Exercisable
Range of Exercise Prices, Number of Options Exercisable (in shares) | shares	1,398
Range of Exercise Prices, Weighted Average Exercise Price (in dollars per share)	$ 25.79

Share-Based Payments - Schedule

Share-Based Payments - Schedule of weighted average assumptions for valuation of stock options (Details) - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Stock option disclosures
Proceeds from exercises of stock options	$ 13,072	$ 52,627
Stock Option Awards
Weighted average assumptions relating to the valuation of stock options
Expected life (in years)	5 years	5 years
Expected volatility (as a percent)	27.20%	30.90%
Risk-free interest rate (as a percent)	1.50%	1.60%
Dividend yield (as a percent)	0.00%	0.00%
Stock option disclosures
Weighted average fair value of the stock options issued (in dollars per share)	$ 6.32	$ 8.78
Aggregate intrinsic value of options exercised	$ 9,100
Proceeds from exercises of stock options	13,100
Tax benefit realized for the tax deductions of stock option exercises	3,200
Total unrecognized compensation costs related to unvested stock option awards	$ 11,500
Weighted average period for recognition of unvested awards	2 years

Share-Based Payments - Restrict

Share-Based Payments - Restricted Stock Awards (Details) - Restricted Stock Awards - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	9 Months Ended	12 Months Ended
	Jun. 30, 2016	Sep. 30, 2015
Restricted stock (in shares)
Unvested at the beginning of the period (in shares)	446
Granted (in shares)	40
Vested (in shares)	(125)
Forfeited (in shares)	(9)
Unvested at the end of the period (in shares)	352	446
Restricted Stock (in dollars per share)
Unvested at the beginning of the period (in dollars per share)	$ 25.82
Granted (in dollars per share)	25.35
Vested (in dollars per share)	21.92
Forfeited (in dollars per share)	27.92
Unvested at the end of the period (in dollars per share)	$ 27.09	$ 25.82
Restricted stock (in years)
Weighted average remaining vested term (in years)	2 years 1 month 6 days	2 years 9 months 18 days
Total unrecognized compensation costs	$ 3.8
Weighted average period for recognition of unvested restricted awards	2 years 1 month 6 days
Minimum
Restricted stock (in years)
Vesting period	3 years
Maximum
Restricted stock (in years)
Vesting period	5 years

Share-Based Payments - Restri39

Share-Based Payments - Restricted Stock Units (Details) - Restricted Stock Units $ / shares in Units, $ in Millions	9 Months Ended
	Jun. 30, 2016USD ($)$ / sharesshares
Restricted stock (in shares)
Granted (in shares) | shares	27,000
Unvested at the end of the period (in shares) | shares	27,000
Restricted Stock (in dollars per share)
Granted (in dollars per share) | $ / shares	$ 23.99
Unvested at the end of the period (in dollars per share) | $ / shares	$ 23.99
Restricted stock (in years)
Weighted average remaining vested term (in years)	2 months 12 days
Vesting period	1 year
Restricted stock units, retention period	6 months
Total unrecognized compensation costs | $	$ 0.2
Weighted average period for recognition of unvested awards	2 months 12 days
Maximum
Restricted stock (in years)
Vesting period	1 year

Goodwill and Intangible Assets

Goodwill and Intangible Assets (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Sep. 30, 2015
Goodwill and Intangible Assets
Impairment losses in connection with the goodwill			$ 0		$ 0
Impairment losses in connection with the intangible assets			0		$ 0
Amortization expense	$ 3.4	$ 3.6	$ 10.3	$ 10.7

Commitments and Contingencies (

Commitments and Contingencies (Details) $ in Millions	3 Months Ended	9 Months Ended
	Jun. 30, 2016USD ($)item	Jun. 30, 2016USD ($)	Jun. 30, 2015USD ($)	Sep. 30, 2015USD ($)
Commitments and contingencies
Accrued liability related to loss contingency	$ 3.8	$ 3.8
Data security incidents | 2015 data security incident
Commitments and contingencies
Number of payment card networks which made claims against the company | item	1
Value of claims against the company	$ 0.9
Accrued liability related to loss contingency	$ 0.9	0.9
Data security incidents | 2014 data security incident
Commitments and contingencies
Accrued liability related to loss contingency				$ 2.9
Selling, general and administrative expenses | Data security incidents
Commitments and contingencies
Data security incident expenses		$ 2.6	$ 5

Short-term Borrowings and Lon42

Short-term Borrowings and Long-Term Debt - Details of Long-Term Debt Table (Details) - USD ($) $ in Thousands	9 Months Ended
	Jun. 30, 2016	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2012
Debt Instruments
Total	$ 1,800,000	$ 1,800,000
ABL facility
Debt Instruments
Total	$ 1,808,100	1,809,400
ABL facility | Prime | Minimum
Debt Instruments
Percentage points added to the reference rate	0.50%
ABL facility | Prime | Maximum
Debt Instruments
Percentage points added to the reference rate	0.75%
ABL facility | LIBOR | Minimum
Debt Instruments
Percentage points added to the reference rate	1.50%
ABL facility | LIBOR | Maximum
Debt Instruments
Percentage points added to the reference rate	1.75%
Senior notes due Nov. 2019
Debt Instruments
Total		750,000
Interest rate (as a percent)	6.875%			6.875%
Senior notes due Jun. 2022
Debt Instruments
Total	$ 850,000	850,000
Interest rate (as a percent)	5.75%			5.75%
Senior notes due Nov. 2023
Debt Instruments
Total	$ 200,000	$ 200,000
Interest rate (as a percent)	5.50%		5.50%
Senior notes due Dec. 2025
Debt Instruments
Total	$ 750,000
Interest rate (as a percent)	5.625%			5.625%

Short-term Borrowings and Lon43

Short-term Borrowings and Long-Term Debt - Details of Long-Term Debt Table - Total debt (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Sep. 30, 2015
Short-term Borrowings and Long-term Debt
Total	$ 1,800,000	$ 1,800,000
Plus: capital lease obligations	2,292	2,870
Less: unamortized debt issuance costs and premium, net	18,688	15,276
Total debt	$ 1,783,604	$ 1,787,594

Short-term Borrowings and Lon44

Short-term Borrowings and Long-Term Debt - Details of Long-Term Debt Table - Total long-term debt (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Sep. 30, 2015
Short-term Borrowings and Long-term Debt
Total debt	$ 1,783,604	$ 1,787,594
Less: current maturities	721	755
Total long-term debt	$ 1,782,883	$ 1,786,839

Short-term Borrowings and Lon45

Short-term Borrowings and Long-Term Debt - Details of Long-Term Debt Table - Subscript Details (Details) - USD ($) $ in Millions	Jun. 30, 2016	Sep. 30, 2015
Debt Instruments
Unamortized premium related to certain notes	$ 5.8	$ 6.5
Aggregate principal amount related to certain notes	150
ABL facility | Other assets
Debt Instruments
Unamortized deferred financing costs	$ 1.8	$ 2.4

Short-term Borrowings and Lon46

Short-term Borrowings and Long-Term Debt - ABL Facility and Senior Notes (Details) - USD ($) $ in Thousands	Dec. 03, 2015	Dec. 31, 2015	Jun. 30, 2016	Jun. 30, 2015	Sep. 30, 2014	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2013	Sep. 30, 2006
Debt Instruments
Aggregate principal amount of debt retired						$ 1,391,900
Borrowings repaid			$ 938,346	$ 1,619
Loss on extinguishment of debt			33,296
Capitalized financing costs			12,748
Sally Investment Holdings LLC and Sally Holdings, LLC
Debt Instruments
Debt instrument, face amount									$ 1,850,000
ABL facility
Debt Instruments
Revolving credit facility								$ 500,000
Outstanding borrowings			0
Remaining credit facility available			$ 478,400
Commitment fee for line of credit facility (as a percent)			0.25%
Borrowings repaid					$ 88,500
ABL facility | Sally Holdings, LLC
Debt Instruments
Debt Instrument, Term							5 years
ABL facility | Restricted payments in excess of $30.0 million
Debt Instruments
Revolving credit facility			$ 150,000
Canadian sub-facility
Debt Instruments
Revolving credit facility							$ 25,000
Senior notes due Nov. 2019
Debt Instruments
Debt instrument, face amount						$ 750,000
Interest rate (as a percent)			6.875%			6.875%
Redemption premium (as a percent)		103.438%
Total redemption cost	$ 775,800
Loss on extinguishment of debt	33,300		$ 33,300
Redemption premium of debt	25,800
Unamortized deferred financing costs	7,500
Senior notes due Jun. 2022
Debt Instruments
Debt instrument, face amount						$ 850,000
Interest rate (as a percent)			5.75%			5.75%
Senior notes due Nov. 2023
Debt Instruments
Debt instrument, face amount					$ 200,000
Interest rate (as a percent)			5.50%		5.50%
Proceeds used to repay borrowings					$ 196,300
Maximum percentage of original principal amount that can be redeemed from specified proceeds			35.00%
Senior notes due Dec. 2025
Debt Instruments
Debt instrument, face amount	750,000
Interest rate (as a percent)			5.625%			5.625%
Proceeds used to repay borrowings	737,300
Capitalized financing costs	$ 12,700
Maximum percentage of original principal amount that can be redeemed from specified proceeds			35.00%
Senior notes due 2022 issued for $150 million
Debt Instruments
Debt instrument, face amount						$ 150,000

Short-term Borrowings and Lon47

Short-term Borrowings and Long-Term Debt - Maturities of the Company's long-term debt (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Sep. 30, 2015
Fiscal Year
Thereafter	$ 1,800,000
Total	1,800,000	$ 1,800,000
Plus: capital lease obligations	2,292	2,870
Less: unamortized debt issuance costs and premium, net	18,688	15,276
Less: current maturities	721	755
Total long-term debt	$ 1,782,883	$ 1,786,839

Short-term Borrowings and Lon48

Short-term Borrowings and Long-Term Debt - ABL Facility and Senior Notes Additional Details (Details) $ in Thousands	9 Months Ended
	Jun. 30, 2016USD ($)item	Sep. 30, 2015USD ($)	Jun. 30, 2015USD ($)	Sep. 30, 2014USD ($)	Sep. 30, 2013USD ($)
Debt Instruments
Cash and cash equivalents	$ 90,997	$ 140,038	$ 239,145	$ 106,575
ABL facility
Debt Instruments
Secured Leverage Ratio, threshold	4
Minimum borrowing availability	$ 40,000
Percentage of borrowing base	10.00%
Revolving credit facility					$ 500,000
Consolidated Fixed-Charge Coverage Ratio, threshold	1
Consolidated Fixed-Charge Coverage Ratio	3.2
ABL facility | Maximum
Debt Instruments
Secured Leverage Ratio	0.1
ABL facility | Restricted payments up to $30.0 million
Debt Instruments
Restricted payments	$ 30,000
Minimum borrowing availability	$ 75,000
Percentage of borrowing base	15.00%
Period prior to payments of dividends and other equity distributions up to certain thresholds under the terms of the credit facility must be met	45 days
ABL facility | Restricted payments in excess of $30.0 million
Debt Instruments
Minimum borrowing availability	$ 100,000
Percentage of borrowing base	20.00%
Revolving credit facility	$ 150,000
Period prior to payments of dividends and other equity distributions up to certain thresholds under the terms of the credit facility must be met	45 days
Consolidated Fixed-Charge Coverage Ratio, threshold	1.1
Percentage of lesser of $150.0 million or borrowing base, considered for applicability of Consolidated Fixed Charge Coverage Ratio	30
Trailing period preceding proposed Restricted Payment	12 months
Senior notes due 2022, 2023 and 2025
Debt Instruments
Consolidated Coverage Ratio, threshold	2
Consolidated Coverage Ratio	6.1
Number of consecutive fiscal quarters | item	4
Percentage of Sally Holdings and its subsidiaries cumulative consolidated net earnings	50.00%
Consolidated Total Leverage Ratio, threshold	3.25
Consolidated Total Leverage Ratio	2.7
Senior notes due 2022, 2023 and 2025 | Maximum
Debt Instruments
Cash and cash equivalents	$ 100,000
Senior notes due Dec. 2025
Debt Instruments
Maximum conditional amount of debt for restricted payments	$ 350,000

Derivative Instruments and He49

Derivative Instruments and Hedging Activities - (Details) - Jun. 30, 2016 € in Millions, £ in Millions, MXN in Millions, CAD in Millions, $ in Millions	MXNderivative	EUR (€)derivative	GBP (£)derivative	USD ($)derivative	CADderivative
Designated Cash Flow Hedges
Number of derivative instruments held	0	0	0	0	0
USD:EUR | Sale | Derivatives not designated as hedging instruments | Cash Flow Hedges To Manage Exposure Of International Subsidiaries Purchases Of Merchandise From Third Party Suppliers
Derivative Instruments
Notional amount		€ 3.2		$ 3.5
Non-designated Cash Flow Hedges
Weighted average contractual exchange rate (as a percent)	1.1290	1.1290	1.1290	1.1290	1.1290
USD:EUR | Sale | Derivatives not designated as hedging instruments | Cash Flow Hedges In Connection With Intercompany Balances
Derivative Instruments
Notional amount		€ 22.2		$ 24.7
Non-designated Cash Flow Hedges
Contractual exchange rate (as a percent)	1.1107	1.1107	1.1107	1.1107	1.1107
USD:CAD | Sale | Derivatives not designated as hedging instruments | Cash Flow Hedges In Connection With Intercompany Balances
Derivative Instruments
Notional amount				$ 6.1	CAD 7.9
Non-designated Cash Flow Hedges
Contractual exchange rate (as a percent)	1.3001	1.3001	1.3001	1.3001	1.3001
CAD:USD | Purchase | Derivatives not designated as hedging instruments | Cash Flow Hedges In Connection With Intercompany Balances
Derivative Instruments
Notional amount				$ 8.7	CAD 11.2
Non-designated Cash Flow Hedges
Weighted average contractual exchange rate (as a percent)	1.3036	1.3036	1.3036	1.3036	1.3036
USD:MXN | Sale | Derivatives not designated as hedging instruments | Cash Flow Hedges In Connection With Intercompany Balances
Derivative Instruments
Notional amount	MXN 28.9			$ 1.6
Non-designated Cash Flow Hedges
Contractual exchange rate (as a percent)	18.6220	18.6220	18.6220	18.6220	18.6220
UK Pounds:USD | Purchase | Derivatives not designated as hedging instruments | Cash Flow Hedges In Connection With Intercompany Balances
Derivative Instruments
Notional amount			£ 7.2	$ 9.6
Non-designated Cash Flow Hedges
Contractual exchange rate (as a percent)	1.3357	1.3357	1.3357	1.3357	1.3357

Derivative Instruments and He50

Derivative Instruments and Hedging Activities - Non-designated Cash Flow Hedges (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Sep. 30, 2015
Derivatives Not Designated as Hedging Instruments
Total derivatives not designated as hedging instruments, Asset	$ 132	$ 322
Total derivatives not designated as hedging instruments, Liability	137	58
Other current assets
Derivatives Not Designated as Hedging Instruments
Foreign Exchange Contracts, Asset	132	322
Accrued liabilities
Credit-risk-related Contingent Features
Foreign Exchange Contracts, Liability	$ 137	$ 58

Derivative Instruments and He51

Derivative Instruments and Hedging Activities - Derivatives Designated as Hedging Instruments (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Derivatives Designated as Hedging Instruments
Probable loss on counterparty defaults			$ 0
Selling, general and administrative expenses
Derivatives Designated as Hedging Instruments
Amount of Gain or (Loss) Recognized in Income on Derivatives, Foreign Exchange Contracts	$ 200	$ (1,000)	(400)	$ 4,000
Foreign exchange contracts
Credit-risk-related Contingent Features
Aggregate fair value of all foreign exchange contracts held in a liability position	100		100
Foreign exchange contracts | Selling, general and administrative expenses
Derivatives Designated as Hedging Instruments
Amount of Gain or (Loss) Recognized in Income on Derivatives, Foreign Exchange Contracts	$ 165	$ (960)	$ (434)	$ 3,991

Business Segments (Details)

Business Segments (Details) $ in Thousands		Dec. 03, 2015USD ($)	Jun. 30, 2016USD ($)	Jun. 30, 2015USD ($)	Jun. 30, 2016USD ($)segment	Jun. 30, 2015USD ($)
Segments
Number of operating segments | segment					2
Net sales:
Total net sales			$ 998,161	$ 967,890	$ 2,976,260	$ 2,870,112
Segment operating profit:
Total segment operating profit			134,084	130,849	387,478	376,093
Share-based compensation expense			(2,838)	(2,866)	(10,011)	(13,466)
Interest expense	[1]		(26,703)	(29,221)	(117,617)	(87,690)
Earnings (loss) before provision for income taxes			107,381	101,628	269,861	288,403
Loss on extinguishment of debt
Loss on extinguishment of debt					33,296
Senior notes due Nov. 2019
Loss on extinguishment of debt
Loss on extinguishment of debt		$ 33,300			33,300
Operating segments
Segment operating profit:
Total segment operating profit			170,104	168,358	505,441	487,822
Corporate
Segment operating profit:
Unallocated expenses (a)	[2]		(33,182)	(34,643)	(107,952)	(98,263)
Sally Beauty Supply
Net sales:
Total net sales			597,086	588,593	1,780,674	1,747,222
Sally Beauty Supply | Operating segments
Segment operating profit:
Total segment operating profit			104,797	107,264	312,849	314,532
Beauty Systems Group
Net sales:
Total net sales			401,075	379,297	1,195,586	1,122,890
Beauty Systems Group | Operating segments
Segment operating profit:
Total segment operating profit			$ 65,307	$ 61,094	$ 192,592	$ 173,290
[1]	For the nine months ended June 30, 2016, interest expense includes a loss on extinguishment of debt of $33.3 million in connection with the Company’s December 2015 redemption of its senior notes due 2019.
[2]	Unallocated expenses consist of corporate and shared costs.For the nine months ended June 30, 2016, interest expense includes a loss on extinguishment of debt of $33.3 million in connection with the Company’s December 2015 redemption of its senior notes due 2019.

Parent, Issuers, Guarantor an53

Parent, Issuers, Guarantor and Non-Guarantor Condensed Consolidated Financial Statements - Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Sep. 30, 2015	Jun. 30, 2015	Sep. 30, 2014
Condensed Consolidating Balance Sheet
Percentage of guarantor subsidiaries owned by parent	100.00%
Assets
Cash and cash equivalents	$ 90,997	$ 140,038	$ 239,145	$ 106,575
Trade and other accounts receivable, less allowance for doubtful accounts	84,464	91,092
Inventory	909,255	885,214
Other current assets	40,640	37,049
Deferred income tax assets	33,789	33,709
Property and equipment, net	307,823	270,847
Goodwill and other intangible assets, net	609,023	623,217
Other assets	15,105	13,185
Total assets	2,091,096	2,094,351
Liabilities and Stockholders' (Deficit) Equity
Accounts payable	280,224	275,917
Accrued liabilities	184,691	208,717
Income taxes payable	2,956	6,310
Long-term debt	1,783,604	1,787,594
Other liabilities	21,855	27,734
Deferred income tax liabilities	100,671	85,900
Total liabilities	2,374,001	2,392,172
Total stockholders' (deficit) equity	(282,905)	(297,821)
Total liabilities and stockholders' deficit	2,091,096	2,094,351
Reportable Legal Entities | Parent
Assets
Other current assets	1,898	2,308
Property and equipment, net	16	2
Investment in subsidiaries	822,299	663,045
Other assets	1,536	1,384
Total assets	825,749	666,739
Liabilities and Stockholders' (Deficit) Equity
Due to affiliates	1,106,313	962,264
Accrued liabilities	898	771
Income taxes payable	1,443	1,525
Total liabilities	1,108,654	964,560
Total stockholders' (deficit) equity	(282,905)	(297,821)
Total liabilities and stockholders' deficit	825,749	666,739
Reportable Legal Entities | Sally Holdings LLC and Sally Capital Inc.
Assets
Cash and cash equivalents		46,003	138,504	27,000
Other current assets	116	27
Deferred income tax assets	11	11
Investment in subsidiaries	3,330,447	3,099,141
Other assets	2,337	2,894
Total assets	3,332,911	3,148,076
Liabilities and Stockholders' (Deficit) Equity
Due to affiliates	717,605	658,106
Accrued liabilities	9,827	40,768
Income taxes payable	1,577	1,337
Long-term debt	1,781,312	1,784,724
Deferred income tax liabilities	291	96
Total liabilities	2,510,612	2,485,031
Total stockholders' (deficit) equity	822,299	663,045
Total liabilities and stockholders' deficit	3,332,911	3,148,076
Reportable Legal Entities | Guarantor Subsidiaries
Assets
Cash and cash equivalents	56,395	58,851	66,037	40,042
Trade and other accounts receivable, less allowance for doubtful accounts	55,686	60,744
Due from affiliates	1,900,261	1,687,325
Inventory	704,472	687,884
Other current assets	19,985	17,803
Deferred income tax assets	30,565	30,565
Property and equipment, net	234,211	195,271
Investment in subsidiaries	356,426	360,416
Goodwill and other intangible assets, net	461,879	468,342
Other assets	(6,007)	(6,949)
Total assets	3,813,873	3,560,252
Liabilities and Stockholders' (Deficit) Equity
Accounts payable	223,317	217,964
Due to affiliates	31	35
Accrued liabilities	145,398	136,688
Long-term debt	40	109
Other liabilities	18,124	24,686
Deferred income tax liabilities	96,516	81,629
Total liabilities	483,426	461,111
Total stockholders' (deficit) equity	3,330,447	3,099,141
Total liabilities and stockholders' deficit	3,813,873	3,560,252
Reportable Legal Entities | Non-Guarantor Subsidiaries
Assets
Cash and cash equivalents	34,602	35,184	$ 34,604	$ 39,533
Trade and other accounts receivable, less allowance for doubtful accounts	28,778	30,348
Due from affiliates	31	35
Inventory	204,783	197,330
Other current assets	18,641	16,911
Deferred income tax assets	3,213	3,133
Property and equipment, net	73,596	75,574
Goodwill and other intangible assets, net	147,144	154,875
Other assets	17,239	15,856
Total assets	528,027	529,246
Liabilities and Stockholders' (Deficit) Equity
Accounts payable	56,907	57,953
Due to affiliates	76,343	66,955
Accrued liabilities	28,568	30,490
Income taxes payable	(64)	3,448
Long-term debt	2,252	2,761
Other liabilities	3,731	3,048
Deferred income tax liabilities	3,864	4,175
Total liabilities	171,601	168,830
Total stockholders' (deficit) equity	356,426	360,416
Total liabilities and stockholders' deficit	528,027	529,246
Consolidating Eliminations
Assets
Due from affiliates	(1,900,292)	(1,687,360)
Investment in subsidiaries	(4,509,172)	(4,122,602)
Total assets	(6,409,464)	(5,809,962)
Liabilities and Stockholders' (Deficit) Equity
Due to affiliates	(1,900,292)	(1,687,360)
Total liabilities	(1,900,292)	(1,687,360)
Total stockholders' (deficit) equity	(4,509,172)	(4,122,602)
Total liabilities and stockholders' deficit	$ (6,409,464)	$ (5,809,962)

Parent, Issuers, Guarantor an54

Parent, Issuers, Guarantor and Non-Guarantor Condensed Consolidated Financial Statements - Condensed Consolidating Statement of Earnings and Comprehensive Income (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Condensed Consolidating Statement of Earnings and Comprehensive Income
Net sales	$ 998,161	$ 967,890	$ 2,976,260	$ 2,870,112
Cost of products sold and distribution expenses	499,185	486,571	1,495,761	1,447,572
Gross profit	498,976	481,319	1,480,499	1,422,540
Selling, general and administrative expenses	339,459	327,870	1,020,497	982,279
Depreciation and amortization	25,433	22,600	72,524	64,168
Operating earnings (loss)	134,084	130,849	387,478	376,093
Interest expense (income)	26,703	29,221	117,617	87,690
Earnings (loss) before provision for income taxes	107,381	101,628	269,861	288,403
Provision (benefit) for income taxes	39,462	39,165	99,540	109,496
Net earnings	67,919	62,463	170,321	178,907
Other comprehensive income (loss), net of tax	(14,119)	11,815	(16,191)	(35,344)
Total comprehensive income (loss)	53,800	74,278	154,130	143,563
Reportable Legal Entities | Parent
Condensed Consolidating Statement of Earnings and Comprehensive Income
Selling, general and administrative expenses	2,799	2,315	8,375	7,035
Depreciation and amortization	1	1	2	1
Operating earnings (loss)	(2,800)	(2,316)	(8,377)	(7,036)
Earnings (loss) before provision for income taxes	(2,800)	(2,316)	(8,377)	(7,036)
Provision (benefit) for income taxes	(1,088)	(900)	(3,254)	(2,733)
Equity in earnings of subsidiaries, net of tax	69,631	63,879	175,444	183,210
Net earnings	67,919	62,463	170,321	178,907
Total comprehensive income (loss)	67,919	62,463	170,321	178,907
Reportable Legal Entities | Sally Holdings LLC and Sally Capital Inc.
Condensed Consolidating Statement of Earnings and Comprehensive Income
Selling, general and administrative expenses	93	69	263	262
Operating earnings (loss)	(93)	(69)	(263)	(262)
Interest expense (income)	26,681	29,183	117,547	87,561
Earnings (loss) before provision for income taxes	(26,774)	(29,252)	(117,810)	(87,823)
Provision (benefit) for income taxes	(10,399)	(11,411)	(45,758)	(34,111)
Equity in earnings of subsidiaries, net of tax	86,006	81,720	247,496	236,922
Net earnings	69,631	63,879	175,444	183,210
Total comprehensive income (loss)	69,631	63,879	175,444	183,210
Reportable Legal Entities | Guarantor Subsidiaries
Condensed Consolidating Statement of Earnings and Comprehensive Income
Net sales	811,657	784,471	2,427,585	2,325,227
Related party sales	678	712	2,060	2,113
Cost of products sold and distribution expenses	399,317	388,683	1,201,276	1,159,415
Gross profit	413,018	396,500	1,228,369	1,167,925
Selling, general and administrative expenses	265,887	253,623	801,954	757,850
Depreciation and amortization	19,488	16,716	55,139	46,869
Operating earnings (loss)	127,643	126,161	371,276	363,206
Interest expense (income)	(8)		(4)	3
Earnings (loss) before provision for income taxes	127,651	126,161	371,280	363,203
Provision (benefit) for income taxes	48,037	49,098	139,860	138,563
Equity in earnings of subsidiaries, net of tax	6,392	4,657	16,076	12,282
Net earnings	86,006	81,720	247,496	236,922
Total comprehensive income (loss)	86,006	81,720	247,496	236,922
Reportable Legal Entities | Non-Guarantor Subsidiaries
Condensed Consolidating Statement of Earnings and Comprehensive Income
Net sales	186,504	183,419	548,675	544,885
Cost of products sold and distribution expenses	100,546	98,600	296,545	290,270
Gross profit	85,958	84,819	252,130	254,615
Selling, general and administrative expenses	70,680	71,863	209,905	217,132
Depreciation and amortization	5,944	5,883	17,383	17,298
Operating earnings (loss)	9,334	7,073	24,842	20,185
Interest expense (income)	30	38	74	126
Earnings (loss) before provision for income taxes	9,304	7,035	24,768	20,059
Provision (benefit) for income taxes	2,912	2,378	8,692	7,777
Net earnings	6,392	4,657	16,076	12,282
Other comprehensive income (loss), net of tax	(14,119)	11,815	(16,191)	(35,344)
Total comprehensive income (loss)	(7,727)	16,472	(115)	(23,062)
Consolidating Eliminations
Condensed Consolidating Statement of Earnings and Comprehensive Income
Related party sales	(678)	(712)	(2,060)	(2,113)
Cost of products sold and distribution expenses	(678)	(712)	(2,060)	(2,113)
Equity in earnings of subsidiaries, net of tax	(162,029)	(150,256)	(439,016)	(432,414)
Net earnings	(162,029)	(150,256)	(439,016)	(432,414)
Total comprehensive income (loss)	$ (162,029)	$ (150,256)	$ (439,016)	$ (432,414)

Parent, Issuers, Guarantor an55

Parent, Issuers, Guarantor and Non-Guarantor Condensed Consolidated Financial Statements - Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Thousands	9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Condensed Consolidating Statement of Cash Flows
Net cash provided (used) by operating activities	$ 248,813	$ 206,911
Cash Flows from Investing Activities:
Capital expenditures	(108,270)	(70,649)
Acquisitions, net of cash acquired	(2,250)	(2,765)
Net cash used by investing activities	(110,520)	(73,414)
Cash Flows from Financing Activities:
Proceeds from issuance of long-term debt	912,000	983
Repayments of long-term debt	(938,346)	(1,619)
Repurchases of common stock	(162,367)	(74,284)
Debt issuance costs	(12,748)
Proceeds from exercises of stock options	13,072	52,627
Excess tax benefit from share-based compensation	1,296	23,209
Net cash provided by financing activities	(187,093)	916
Effect of foreign exchange rate changes on cash and cash equivalents	(241)	(1,843)
Net (decrease) increase in cash and cash equivalents	(49,041)	132,570
Cash and cash equivalents, beginning of period	140,038	106,575
Cash and cash equivalents, end of period	90,997	239,145
Reportable Legal Entities | Parent
Condensed Consolidating Statement of Cash Flows
Net cash provided (used) by operating activities	148,015	(1,550)
Cash Flows from Investing Activities:
Capital expenditures	(16)	(2)
Net cash used by investing activities	(16)	(2)
Cash Flows from Financing Activities:
Repurchases of common stock	(162,367)	(74,284)
Proceeds from exercises of stock options	13,072	52,627
Excess tax benefit from share-based compensation	1,296	23,209
Net cash provided by financing activities	(147,999)	1,552
Reportable Legal Entities | Sally Holdings LLC and Sally Capital Inc.
Condensed Consolidating Statement of Cash Flows
Net cash provided (used) by operating activities	(7,470)	111,504
Cash Flows from Financing Activities:
Proceeds from issuance of long-term debt	912,000
Repayments of long-term debt	(937,785)
Debt issuance costs	(12,748)
Net cash provided by financing activities	(38,533)
Net (decrease) increase in cash and cash equivalents	(46,003)	111,504
Cash and cash equivalents, beginning of period	46,003	27,000
Cash and cash equivalents, end of period		138,504
Reportable Legal Entities | Guarantor Subsidiaries
Condensed Consolidating Statement of Cash Flows
Net cash provided (used) by operating activities	89,972	80,159
Cash Flows from Investing Activities:
Capital expenditures	(90,109)	(52,016)
Acquisitions, net of cash acquired	(2,250)	(2,028)
Net cash used by investing activities	(92,359)	(54,044)
Cash Flows from Financing Activities:
Proceeds from issuance of long-term debt		14
Repayments of long-term debt	(69)	(134)
Net cash provided by financing activities	(69)	(120)
Net (decrease) increase in cash and cash equivalents	(2,456)	25,995
Cash and cash equivalents, beginning of period	58,851	40,042
Cash and cash equivalents, end of period	56,395	66,037
Reportable Legal Entities | Non-Guarantor Subsidiaries
Condensed Consolidating Statement of Cash Flows
Net cash provided (used) by operating activities	18,296	16,798
Cash Flows from Investing Activities:
Capital expenditures	(18,145)	(18,631)
Acquisitions, net of cash acquired		(737)
Net cash used by investing activities	(18,145)	(19,368)
Cash Flows from Financing Activities:
Proceeds from issuance of long-term debt		969
Repayments of long-term debt	(492)	(1,485)
Net cash provided by financing activities	(492)	(516)
Effect of foreign exchange rate changes on cash and cash equivalents	(241)	(1,843)
Net (decrease) increase in cash and cash equivalents	(582)	(4,929)
Cash and cash equivalents, beginning of period	35,184	39,533
Cash and cash equivalents, end of period	$ 34,602	$ 34,604