Supercuts 2005 Annual Report Download - page 94

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
11. SEGMENT INFORMATION:
The Company operates or franchises 8,861 North American salons (located in the United States, Canada and Puerto Rico), 2,018
international salons and 24 beauty schools. Additionally, the Company operates or franchises 90 hair restoration centers (41 company-owned
and 49 franchise locations), stemming from its purchase of Hair Club for Men and Women during December 2004. The Company operates its
North American salon operations through five primary concepts: Regis Salons, MasterCuts, Trade Secret, SmartStyle and Strip Center salons.
Each of the concepts offer similar products and services, concentrates on the mass-market consumer marketplace and has consistent
distribution channels. All of the company-owned and franchise salons within the North American salon concepts are located in high traffic,
retail shopping locations that attract mass-market consumers, and the individual salons generally display similar economic characteristics. The
salons share interdependencies and a common support base. The Company’s international salon operations, which are primarily in Europe, are
located in malls, leading department stores, mass merchants and high-street locations. The Company’s beauty schools are located in the United
States and the United Kingdom. The Company’s newly acquired hair restoration centers are located in the United States and Canada.
Based on the way the Company manages its business, it has reported its North American salons, international salons, beauty schools and
hair restoration centers as four separate segments. In the prior fiscal year, the Company reported two segments: North American and
international operations. Salons and beauty schools were included within each of these segments due to the way in which the Company
managed its business at that time. Management began reviewing the operations of the beauty schools separately from the salon operations
during fiscal year 2005 in anticipation of further expansion into the beauty school business. Further, the acquisition of Hair Club for Men and
Women allowed the Company to expand into a new line of business, and thereby created an additional segment (hair restoration centers).
Segment information for the fiscal year 2004 and 2003 has been reclassified to conform to the current year presentation.
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