SEGMENT INFORMATION

3 Months Ended

Sep. 30, 2024

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION:

Segment information is prepared on the same basis that the chief operating decision maker (CODM) reviews financial information for operational decision-making purposes. The Company's reportable operating segments consisted of the following salons:

	September 30, 2024		June 30, 2024
FRANCHISE SALONS:
Supercuts	1,932		1,946
SmartStyle/Cost Cutters in Walmart stores	1,216		1,232
Portfolio Brands	1,106		1,117
Total North American salons	4,254		4,295
Total International salons (1)	96		96
Total franchise salons	4,350		4,391
as a percent of total franchise and company-owned salons	99.8	%	99.6	%
COMPANY-OWNED SALONS:
Supercuts	3		3
SmartStyle/Cost Cutters in Walmart stores	1		8
Portfolio Brands	5		6
Total company-owned salons	9		17
as a percent of total franchise and company-owned salons	0.2	%	0.4	%
Total franchise and company-owned salons	4,359		4,408

_______________________________________________________________________________

(1)Canadian and Puerto Rican salons are included in the North American salon totals.

Financial information concerning the Company's reportable operating segments is shown in the table below. Segment information is presented in the same way that the Company internally organizes the business for assessing performance and making decisions regarding allocation of resources. In fiscal year 2023, the Company revised its internal reporting such that the CODM’s primary measures of segment performance are revenue and segment adjusted EBITDA. Revenue and segment adjusted EBITDA are regularly reviewed by the CODM to make decisions about resources to be allocated to the segments, assess current performance, and forecast future performance. Asset information by segment is not provided to the CODM. Segment adjusted EBITDA is defined as income from continuing operations before interest, income taxes, depreciation, amortization, and impairment. Beginning in fiscal year 2025, management determined that stock-based compensation expenses will be excluded from adjusted EBITDA. This change has been retrospectively applied to all prior periods presented in this report. Consistent with our internal management reporting, unallocated expenses include certain items impacting comparability. These unallocated items are not defined terms within U.S. GAAP. They are based on how management views the business, makes financial, operating and planning decisions and evaluates the Company's ongoing performance and are not attributable to either segment. Unallocated fees include one-time professional fees and settlements, severance expense, the benefit from lease liability decreases in excess of previously impaired ROU assets, lease termination fees, asset retirement obligation costs and long-lived asset impairment charges.

	Three Months Ended September 30,
	2024		2023
	(Dollars in thousands)
Revenues:
Franchise	$	45,275	$	51,436
Company-owned	785		1,936
Total revenue	46,060		53,372
Segment adjusted EBITDA:
Franchise	7,986		8,590
Company-owned	(349)		(497)
Total	7,637		8,093
Unallocated expenses (1)	(2,597)		141
Depreciation and amortization	(446)		(370)
Long-lived asset impairment	(352)		—
Stock-based compensation	(1,430)		(630)
Interest expense	(4,846)		(6,188)
Income tax benefit	225		148
Income from discontinued operations	957		—
Total net (loss) income (2)	$	(853)	$	1,194

_______________________________________________________________________________

(1)Unallocated expenses for the three months ended September 30, 2024, includes severance expenses of $2.3 million.

(2)Total is a recalculation; line items calculated individually may not sum to total due to rounding.