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RGS > SEC Filings for RGS > Form 8-K on 10-Apr-2013All Recent SEC Filings

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Form 8-K for REGIS CORP


10-Apr-2013

Completion of Acquisition or Disposition of Assets, Financial Statements and Exhibits


ITEM 2.01. Completion of Acquisition or Disposition of Assets.

As previously disclosed, on July 13, 2012, Regis Corporation (the "Company") entered into a Stock Purchase Agreement (the "Stock Purchase Agreement") with Aderans Co., Ltd., a Japanese corporation ("Aderans"). The sale of HC (USA), Inc., a Delaware corporation and wholly owned subsidiary of the Company ("Hair Club"), to Aderans for $163.5 million excluding closing adjustments and transaction fees was completed on April 9, 2013.



ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.

(b) Pro forma financial information.

The following unaudited pro forma consolidated statements of operations for years ended June 30, 2012, 2011, and 2010 have been prepared to present our results of operations as if the sale of Hair Club had occurred on July 1, 2009. We have not presented the interim statements of operations for the quarters ended September 30, 2012 and December 31, 2012 as the Hair Club sale qualified as held for sale under ASC 205-20 Discontinued Operations, and was presented as a discontinued operation in our Form 10-Qs for those periods. The pro forma adjustments are based on factually supportable available information and certain assumptions that management believes are reasonable.

The pro forma effect of the sale on the December 31, 2012 balance sheet as reported in our Form 10-Q for the quarter ended December 31, 2012 would be to increase cash for $163.5 million, excluding closing adjustments and transaction fees, and remove current and long-term assets held for sale of $16.8 and $180.0 million, respectively, and current and long-term liabilities held for sale of $16.5 and $28.8 million, respectively, resulting in an after-tax gain of $12.0 million. The actual after-tax gain to be recognized by the Company during the three months ended June 30, 2013 will be adjusted by the closing adjustments and transaction fees.

These pro forma Consolidated Statements of Operations do not purport to be indicative of the financial position or results of operations of the Company as of such date or for such periods, nor are they necessarily indicative of future results. In the opinion of management, all necessary adjustments to the unaudited pro forma financial information have been made. The unaudited pro forma financial statements should be read in conjunction with historical consolidated financial statements of the Company, including the notes thereto, in the Company's Form 10-K for the year ended June 30, 2012 and Form 10-Q for the quarters ended September 30, 2012 and December 31, 2012.


Item 9.01 Financial Statements and Exhibits (Continued)



                               REGIS CORPORATION

                 PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS

                 (Dollars in thousands, expect per share data)

                                  (Unaudited)



                                                    Twelve Months Ended June 30, 2012
                                                Historical      Pro Forma        Pro Forma
                                                Financial       Adjustment       Financial
                                                Statement       Hair Club        Statement
                                                                                    (a)
Revenues:
Service                                        $  1,712,703    $     68,812     $ 1,643,891
Product                                             520,467          80,419         440,048
Royalties and fees                                   40,609           2,321          38,288
                                                  2,273,779         151,552       2,122,227

Operating expenses:
Cost of service                                     985,154          42,693         942,461
Cost of product                                     249,655          28,020         221,635
Site operating expenses                             198,725           6,479         192,246
General and administrative                          302,572          38,943 (b)     263,629
Rent                                                340,805           9,036         331,769
Depreciation and amortization                       118,071          13,101         104,970
Goodwill impairment                                 146,110          78,426          67,684
Total operating expenses                          2,341,092         216,698       2,124,394

Operating loss                                      (67,313 )       (65,146 )        (2,167 )

Other income (expense):
Interest expense                                    (28,245 )             -         (28,245 )
Interest income and other, net                        5,130              32           5,098

(Loss) income from continuing operations
before income taxes and equity in (loss)
income of affiliated companies                      (90,428 )       (65,114 )       (25,314 )

Income taxes                                          5,279             849 (c)       4,430 (c)
Equity in (loss) income of affiliated
companies, net of income taxes                      (30,043 )           816         (30,859 )

Loss from continuing operations                $   (115,192 )  $    (63,449 )   $   (51,743 )

Loss per share from continuing operations:
Basic                                          $      (2.02 )  $      (1.11 )   $     (0.91 )
Diluted                                        $      (2.02 )  $      (1.11 )   $     (0.91 )

Weighted average common and common
equivalent shares outstanding:
Basic                                                57,137          57,137          57,137
Diluted                                              57,137          57,137          57,137

See endnotes.


Item 9.01 Financial Statements and Exhibits (Continued)



                               REGIS CORPORATION

                 PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS

                 (Dollars in thousands, expect per share data)

                                  (Unaudited)



                                                   Twelve Months Ended June 30, 2011
                                               Historical     Pro Forma         Pro Forma
                                               Financial      Adjustment        Financial
                                               Statement      Hair Club         Statement
                                                                                   (a)
Revenues:
Service                                       $  1,762,974   $     67,550      $ 1,695,424
Product                                            523,194         75,729          447,465
Royalties and fees                                  39,701          2,409           37,292
                                                 2,325,869        145,688        2,180,181

Operating expenses:
Cost of service                                  1,012,868         39,129          973,739
Cost of product                                    249,979         24,788          225,191
Site operating expenses                            197,722          4,318          193,404
General and administrative                         339,857         37,038          302,819
Rent                                               342,286          9,227          333,059
Depreciation and amortization                      105,109         12,958           92,151
Goodwill impairment                                 74,100              -           74,100
Total operating expenses                         2,321,921        127,458        2,194,463

Operating income (loss)                              3,948         18,230          (14,282 )

Other income (expense):
Interest expense                                   (34,388 )          (14 )        (34,374 )
Interest income and other, net                       4,811             88            4,723

(Loss) inome from continuing operations
before income taxes and equity in income
of affiliated companies                            (25,629 )       18,304          (43,933 )

Income taxes                                         9,496         (6,837 )(c)      16,333 (c)
Equity in income of affiliated companies,
net of income taxes                                  7,228            567            6,661

(Loss) income from continuing operations      $     (8,905 ) $     12,034      $   (20,939 )

(Loss) income per share from continuing
operations:
Basic                                         $      (0.16 ) $       0.21      $     (0.37 )
Diluted                                       $      (0.16 ) $       0.21      $     (0.37 )

Weighted average common and common
equivalent shares outstanding:
Basic                                               56,704         56,704           56,704
Diluted                                             56,704         56,704           56,704

See endnotes.


Item 9.01 Financial Statements and Exhibits (Continued)



                               REGIS CORPORATION

                 PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS

                 (Dollars in thousands, expect per share data)

                                  (Unaudited)



                                                    Twelve Months Ended June 30, 2010
                                               Historical      Pro Forma         Pro Forma
                                               Financial       Adjustment        Financial
                                               Statement       Hair Club         Statement
                                                                                    (a)
Revenues:
Service                                       $  1,784,137    $     66,325      $ 1,717,812
Product                                            534,593          72,978          461,615
Royalties and fees                                  39,704           2,483           37,221
                                                 2,358,434         141,786        2,216,648

Operating expenses:
Cost of service                                  1,015,720          37,158          978,562
Cost of product                                    263,883          21,568          242,315
Site operating expenses                            199,338           5,305          194,033
General and administrative                         291,991          36,207          255,784
Rent                                               344,098           9,013          335,085
Depreciation and amortization                      108,764          12,198           96,566
Goodwill impairment                                 35,277               -           35,277
Lease termination costs                              2,145               -            2,145
Total operating expenses                         2,261,216         121,449        2,139,767

Operating income                                    97,218          20,337           76,881

Other income (expense):
Interest expense                                   (54,414 )           (26 )        (54,388 )
Interest income and other, net                      10,410              (4 )         10,414

Income from continuing operations before
income taxes and equity in income of
affiliated companies                                53,214          20,307           32,907

Income taxes                                       (25,577 )        (7,365 )(c)     (18,212 )(c)
Equity in income of affiliated companies,
net of income taxes                                 11,942             909           11,033

Income from continuing operations             $     39,579    $     13,851      $    25,728

Income per share from continuing:
Basic                                         $       0.71    $       0.25      $      0.46
Diluted                                       $       0.71    $       0.25      $      0.46

Weighted average common and common
equivalent shares outstanding:
Basic                                               55,806          55,806           55,806
Diluted                                             66,753          56,023 (d)       56,023 (d)

See endnotes.


Item 9.01 Financial Statements and Exhibits (Continued)

REGIS CORPORATION

NOTES TO THE PRO FORMA FINANCIAL STATEMENTS

(Unaudited)



(a) Beginning in the first quarter of fiscal year 2013, the Company reclassified certain salon marketing and advertising expenses that were previously within the cost of service and general and administrative expense to site operating expense. The impact of these reclassifications have been excluded from the Pro Forma Financial Statements.

(b) $2.5 million of professional fees related to the sale of Hair Club were previously included within our Unallocated Corporate Segment and have been included in the Hair Club Pro Forma Adjustment.

(c) Income taxes have been allocated to continuing and discontinued operations based on the methodology required by accounting for income tax guidance.

(d) As a result of the Hair Club Pro Forma Adjustments, the impact of the convertible debt is anti-dilutive to the Pro Forma Financial Statements for the twelve months ended June 30, 2010 and is therefore excluded from the weighted average shares for diluted earnings per share.


Item 9.01 Financial Statements and Exhibits (Continued)

(d) Exhibits.

EXHIBIT
NUMBER

99 Regis Corporation News Release dated April 9, 2013


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