UPDATE 1-Regis shares jump after Q2 profit, Trade Secret deal

(Adds details from conference call; updates share movement)

Jan 28 (Reuters) - Shares of hair-salon operator Regis Corp (RGS.N) rose as much as 25 percent Wednesday, a day after the company posted a better-than-expected second-quarter profit and said it would sell its Trade Secret retail-product division.

Regis is also planning to increase prices in 5000 stores, Chief Executive Paul Finkelstein said on a conference call with analysts on Wednesday. It had increased prices in 6000 stores in the 2008 financial year, he said.

Chief Financial Officer Randy Pearce said the company closed 19 salons in the second quarter, and is working with landlords to close additional salons or obtain rent reductions.

Although Regis will not get any proceeds from the sale of the Trade Secret division, which was expected to post losses of more than $23 million in 2009, the company expects to receive an income tax benefit and related cash refund of $56 million. [ID:nBNG120593]

Shares of Minneapolis-based Regis rose to a high of $13.25, before paring some gains to trade up $2.30 at $12.92 Wednesday afternoon on the New York Stock Exchange. (Reporting by Anne Pallivathuckal and Mihir Dalal in Bangalore; Editing by Himani Sarkar, Pratish Narayanan)