morning. Sure. Thanks and good to you
in our we model. significant franchised progress to a transition you mentioned, fully to are As report very pleased
with details adoption accounting that -- you lease the release. into of we've changes a of new noticed getting the overview quarter, of likely I'd to related in morning's the standards like Before you quick these our this to share
through guidance we on restate and does comparative however, accounted like The on is the the lease we P&L. now not operating Historically, standard impact accounting a new is periods. guidelines, P&L, lease out separate the net corresponding line line basis prospectively rental we new lease expense with rental revenue point that record impact on the revenue and and franchise rental item the to expense in expense gross-up overall items on income. P&L, the have a for the income recorded lease expense both items new of line and not while for the I'd also did net
modeling. in your this please So consider
to lease addition impact, to on accounting lease lease P&L asset sheet. new a and the also required the a million $XXX record balance the approximately us liability of guidance In
However, this portfolio subleased to our long-term is liability a lease growing portion of franchisees.
turning million the company XXXX of primarily past owned by XX franchise conversion over Company's and XX XXX salons decline year. months. to represented driven year-over-year results, the salons we Now which prior over the $XXX reported months consolidated XX.X% morning was revenues the this of $XX.X portfolio quarter versus revenue The decrease the in million, of the to owned of first a or closure the past company
franchise guidance flow connection A our and cash new of accounting partially a majority which were essential with and increase related were to offset revenue by of revenue rent not to million in recorded lease headwinds franchise mentioned. the our negative future. million in segment I the is $XX.X segment $X.X just that These
consolidated the was million the million primarily to the First gain salons goodwill EBITDA of conversion to quarter. year driven was company-owned portfolio related by franchise XXX same derecognition XX.X% last and a during non-cash $XX.X quarter adjusted the or $XX.X and of period $X.X to sale million favorable cash excluding
which by that the have to prior-year million generated company-owned franchise converted year-over-year XX past was Excluding totaled that unfavorable this elimination sold salons from $X.X primarily unfavorable the had of of months. one-time period the variance the gain, in $XX.X been EBITDA year-over-year. was driven EBITDA adjusted the and million company's the The been platform
note marketing. First by in Please quarter and increases, impacted quarter first was the adjusted items technology the income same sales, share investments and $XX.X EBITDA consolidated adjusted as unfavorably million adjusted same-store decline period in operations, also and increased reported XXXX income discrete that $X.XX discontinued per $XX.X strategic $X.XX X.X% a per wage from or minimum income of diluted last net year. for million or company the compared net share diluted to of excluding
franchise segment, segment increased million $XX specific fees salon versus Looking royalties million quarter by the last increased first primarily quarter and with million year counts performance of driven starting XX.X% franchise franchisees to franchise and or at year-over-year. offset $X.X TBG same our counts. franchise to $X.X products same-store sales $X.X increased partially million million decreased by in sold Total year-over-year primarily flat essentially by were Product to decrease a sales $XX.X franchise driven salon
calculated the consistent how salon a our calculate franchise a with franchise and we more same-store in location same-store reminder, are for total company-owned change is have in months. represents XX been sales salons in a As manner portfolio that sales that than sales for
G&A million our investments franchise salon and First to $X support the quarter strategic into enhance franchise improved offset the adjusted EBITDA conversions and of year-over-year $XX.X volume million in further driven growth and portfolio. planned of by increased cadence transactions the portfolio to capabilities franchiser partially approximately by franchise
and recognition EBITDA is rent points comparable as EBITDA I year-over-year. segment XX EBITDA margin our years, with non-contributory point was product of Excluding revenue, expectations. XX.X%, for and not the After the which to cost, Franchise historical year-over-year. over was well the was revenue at impact with franchisee forma sales our line have favorable revenue last revenue, Franchise adjusting fund accounting our Ad favorable TBG, approximately $X.X with the margin sales, of adopted out adjusted as associated franchise in pro TBG percentage TBG approximately year-over-year like guidance we that basis and segment would million lease product to two
decrease is bucketed to Looking revenue driven million prior year-over-year and be can or This XX.X% salon with into categories. decreased main $XXX.X salons which the versus quarter $XX.X past the of two XXXX now over XX company-owned year company-owned segment, fourth decline the consistent by at million. months,
salons XX over not which conversion XXX of second, strategy. of the and closure to of technology our our and course most to franchise I last the enabled course First, over were of as salons sold noted the first of X,XXX unprofitable approximately XX which months, asset future during light earlier, the the past were company-owned months, XXX of the platform quarter essential company-owned the
organic to we franchise by reductions that last offset from salon These company-owned the year salon were partially transition over our ahead. last were XX to and our company-owned in which portfolio back during the net bought XX franchisees salons expect the new months, openings XX months
the $XX.X EBITDA been converted franchise million company to prior year-over-year company-owned salon consolidated in primarily in into was results. the generated quarter the company-owned and over adjusted First of by past were driven platform the year the unfavorable that adjusted variance that the months. XX with segment The $XX.X EBITDA total consistent period salons has the million sold year-over-year elimination decreased
stylist wages a The quarter in launched a Series. during and same-store our playoff was increases decline advertising which campaign, and Supercuts in investments by new season commissions impacted sales MLB unfavorably World X% also and in minimum the
and expenses overhead, sale net non-cash expenses. corporate of company-owned conversion goodwill year-over-year The non-essential to adjusted initiatives EBITDA derecognition million lower $XX.X of and salons. driven quarter million gains the the first net to eliminate of management non-core, of by G&A now is Turning primarily incentive excluding $X.X from impact
These year. in were franchise in timing partially convention that second of first offset the the of the this occurred to prior the year company's compared annual quarter by quarter the
Lastly, want of approximately received out $XXX,XXX 'XX. the salons for cash the proceeds per during $XX,XXX to point year the first full to were quarter compared per unit unit venditioned that for we approximately I the FY
The both -- of these primarily unit SmartStyle the decline mix Supercuts in transaction in salons per and proceeds the lower cash salon venditions have is Signature portfolio. lower by have driven as vendition in typically during multiples year-over-year than our increased quarter
now our strong strategy. providing company's the fund while we flexibility as position, maintained balance sheet, optimal Looking the balance liquidity sheet transformational at have of the elements to expected overall
million. liquidity end $XX.X the equaled net-net On front, quarter cash
proceeds expect we maximize to cash ways in mentioned, Hugh value. utilize shareholder various our vendition As to
ahead. So may cash our quarters in quarter the fluctuate end
quarter, During of for million first the approximately outstanding or shares X.X% we shares X.X million. $XX.X the repurchased total
equivalent year-end $XX 'XX our was our As drawn had on of which million levels. FY existing to credit September we XX, facility,
and a of with by Turning fully the to through single now thought we from franchised associated might flow, of the company-owned flow. first of impacted to million cash down platform. approximately convert cash capital. be cash we of our is working is cash salons wind cash quarter reconciliation cash adjusted it as largest flow This $XX looking see to cash EBITDA at significantly When statement, operations use high free helpful a level to of outlays I use use how provide net flow
the in first quarter, working Specifically capital is the use primarily driven
items. X by
vacation these we of as We future payments related and First continue our restructuring likely teams anticipate franchise our will payroll transition to the fully better platform. to with payments to severance field align types transition state. including outlays related
to lead related normal Secondly, long-term we And incentive both build performance. course and short-term bonus third, inventory payments upcoming and during up quarter, the holiday the FY as 'XX to season. saw we
franchisees. decrease in merchandise to our company's to model point needed to stabilize and expect continue the months ahead However, I convert wholesale want we the support to that to inventory we out materially levels inventory the as
In when into the but franchise flow, operating the net to of adjusted net $XX.X that company-owned our addition platform not you to and are reconciling the from in income to million our in cash change to EBITDA from conversion working in the operations. included fact salons capital take cash account a need gain EBITDA, the adjusted included
As the activities statement. section cash are investing the the as proceeds flow inflows cash in reported of
other Turning items. thought to would update now I operational it helpful a be TBG. brief to on provide
we to transaction of back have pursue number discussed in in a the As XXXX. Regis reasons had October the TBG past, original of
premiums a and and us the risk transaction focus lease First, an exit value rather growth opportunity the than us third party to on in to provided transfer malls the mall-based salons. enabled to sector
continuing associated salons. were transaction, this the operating with Second, losses avoid to these substantially with able we
optionality buyer focus to the has enabled was created able transaction this the portfolio. the strategy. our finally franchise Third, us to improve we And of TBG of conversion performance on
as previously although had some had would as business not of have we this previously provided well performed hoped. we has -- disclosed, we buyer we support, provided ongoing As some the have although
ago. today, entered fact, be over million may approximately this when liability worst transaction that hard worked any $XX continues available and is scenario, and risk original have In two challenged. we this approximately is we from all-in significant struggled of prior to a ongoing our lease reduce decline the mitigation Nevertheless, has the remaining years to in to be and $XXX we the the lease case million estimate us to that business into efforts risks
landlords Looking cash we back operate transfer we OpCo ongoing could potentially to of the lease portfolio options a or buyout the We believe have We could salons and number further? the to minimize negotiated leases, should where these risk a forward, new and/or into to of rents. destabilize we reduce TBG bring have them reduced multiple risk our negotiating amounts our including with salons, operator.
the As we continuing review plan, options but a option our a for best concluded contingency not under have these business. have
You the may filed in have action administrative that recently an UK. been read also has
do any the we was reminder, with stock deal UK as and transaction not a a has or that salons. associated done As TBG this liability believe these with transaction Regis
related the particularly to course to However, continue and best monitor determined we will of UK and review the what this matter salons, action Supercuts.
back the turning Lastly, call questions. before to Katherine for
of we forma on our XX, discussed our provided results we modeled recast XX quarter's As have NewCo recast business. the actual last pro and view last ended for call, a components of months September the franchise between XXXX, ExitCo bifurcated
this you fully about state business. how the believe model, We future we're recast thinking will help franchised
allocations stand-alone this company-owned expenses, and the our cost salons overhead costs. subject one-time material product is in as presented While modeled business with intended ExitCo other they change, stranded are in distribution providing to and represent were a numbers related G&A though sales to to corporate
were our at fully the to like look of in quarter first months pro we what which This for the also The company business based franchise reflect our results. franchise a salons a as component may investments snap corporate end product strategic expenses, intended last to franchised NewCo G&A. long-term scenario, and is of existing with represents distribution a forma XX and our projected on technology sales actual and allocations overhead line new
absolute enables business more and traded sum the companies. pro simpler at one any Conversely, portion this the and work be other analysis believe for perpetuity, its in applied franchise of view business line parts and given should against it short the make pure cycle having anticipated valued we relatively This forma model the a it. at is should value the franchise ExitCo have nominal with NewCo not multiple continue of multiple value to not that publicly of to component a or in life fact
parts purposes, CapEx, franchise NewCo presented cash period Lastly, along consider for of a we when XX, as CapEx. cash of items EBITDA XX ExitCo with the ended actual sum the have and to for sale reminder, cash necessary while flow about the September future months results valuation overall reflects including is proceeds what XXXX, thinking it today last net
during reasonable business between intended in Cassidy. like we'll forward-looking direct Regis franchise G&A, expenses $XX,XXX call our used turn As terms modeling that, would the roughly to be Go guidance, distribution per costs which center G&A. future interest I now for to believe include G&A the to it support in and franchised and would With for like corporate salon fully continued model questions. G&A to in as split you earnings ahead, back discussed your to Cassidy and not August evenly future approximately of is while call, we of state thank
