UPDATE 2-Regis profit falls after weak holiday season
(Adds details on price increases, stock action)
NEW YORK, Jan 22 (Reuters) - Hair salon operator Regis Corp (RGS.N) said on Tuesday that quarterly profit fell to the low end of its forecast range on a sharp drop in consumer spending over the holiday season.
The operator of the Vidal Sassoon and Supercuts chains said net profit declined about 16 percent to $22.6 million, or 51 cents a share, in the second quarter that ended Dec. 31 from $26.9 million, or 59 cents a share, a year earlier.
The results were in line with analysts' expectations, according to Reuters Estimates.
"Like many retailers, we had a disappointing holiday shopping season and, as a result, our quarterly same-store sales came in below expectations," Chief Executive Paul Finkelstein said in a statement.
Finkelstein said the company would raise prices in at least 6,000 salons between January and April, increasing the average ticket there by 6 percent.
"Our salon competitors are all facing minimum wage increases," he said, "and inflation is certainly with us."
Regis said its strongest segments during the quarter were its European business, excluding the UK; the Hair Club for Men and Women; and Supercuts.
Finkelstein also said the company will probably refrain from repurchasing stock in the near term following last week's agreement to buy the PureBeauty and BeautyFirst salon operations.
Earlier this month, Regis had reported a 4 percent increase in revenue to $682 million for the quarter.
Looking ahead, Regis said it expected third-quarter earnings of 48 cents to 54 cents per share on consolidated revenue of $675 million to $685 million.
Analysts on average are expecting profit of 52 cents a share on $677.6 million in revenue, according to Reuters Estimates.
For the full year, Regis forecast a 4 percent increase in consolidated revenue to $2.74 billion and earnings of $2.01 to $2.14 a share.
Analysts expect the company to earn $2.07 a share for the year on about $2.72 billion in revenue.
Regis shares, which reached a nearly five-year low last week, were up 20 cents, or nearly 1 percent, at $22.87 in afternoon New York Stock Exchange trade. (Reporting by Justin Grant; Editing by Lisa Von Ahn)
