Sally Beauty Supply 2006 Annual Report Download - page 86
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Table of Contents
Sally Holdings, Inc. and Subsidiaries
(A Wholly-Owned Subsidiary of Alberto-Culver Company)
Notes to Consolidated Financial Statements
18. Business Segments and Geographic Area Information
The Company’ s business is organized into two separate segments: (i) Sally Beauty Supply, a domestic and international chain of cash
and carry retail stores, which offers professional beauty supplies to both salon professionals and retail customers, and (ii) Beauty
Systems Group, a full service beauty supply distributor, which offers professional brands of beauty products directly to salons through
its own sales force and professional only stores in exclusive geographical territories in North America, the United Kingdom, Spain and
the Netherlands.
The accounting policies of the segments are the same as described in the summary of significant accounting policies in “note 1.” The
Company does not sell between segments.
Segment data for the fiscal years ended September 30, 2006, 2005 and 2004 is as follows (in thousands):
Business Segments Information
2006 2005 2004
Net sales:
Sally Beauty Supply $ 1,419,332 $ 1,358,899 $ 1,296,057
Beauty Systems Group 953,768 895,408 801,610
$ 2,373,100 $ 2,254,307 $ 2,097,667
Earnings before provision for income taxes:
Sally Beauty Supply $ 188,786 $ 168,663 $ 151,811
Beauty Systems Group 66,928 55,584 70,895
Segment operating profit 255,714 224,247 222,706
Unallocated expenses* (28,852 ) (27,615 ) (26,051 )
Stock option expense (5,186 )
—
—
Non-cash charge related to Alberto-Culver’ s conversion to
one class of common stock
—
(4,051 ) (27,036 )
Transaction expense (41,475 )
—
—
Interest expense, net of interest income (92 ) (2,966 ) (2,250 )
$ 180,109 $ 189,615 $ 167,369
Identifiable assets:
Sally Beauty Supply $ 557,615 $ 465,091 $ 465,813
Beauty Systems Group 770,436 726,182 601,098
Sub-total 1,328,051 1,191,273 1,066,911
Corporate** 10,790 34,234 35,517
Total $ 1,338,841 $ 1,225,507 $ 1,102,428
Depreciation and amortization:
Sally Beauty Supply $ 21,923 $ 20,506 $ 15,596
Beauty Systems Group 16,109 13,400 9,023
Total depreciation and amortization $ 38,032 $ 33,906 $ 24,619
Capital expenditures:
Sally Beauty Supply $ 20,952 $ 33,358 $ 40,242
Beauty Systems Group 9,390 18,878 11,721
Total capital expenditures $ 30,342 $ 52,236 $ 51,963
*
Unallocated expenses consist of corporate charges from Alberto-Culver.
**
Corporate identifiable assets consist of amounts due from Alberto-Culver, deferred tax assets and notes
receivable from affiliated companies.
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