Non-GAAP Financial Measures Reconciliations:

 

SALLY BEAUTY HOLDINGS, INC. AND SUBSIDIARIES
Non-GAAP Financial Measures Reconciliations
(In thousands, except per share data)
(Unaudited)
 
Three Months Ended
June 30,
      2012   2011   % CHG
Adjusted EBITDA:    
Net earnings (per GAAP) $ 69,487 $ 69,143 0.5 %
Add:
Depreciation and amortization 16,299 15,273 6.7 %
Share-based compensation 2,825 2,462 14.7 %
Interest expense (1) 26,925 27,741 -2.9 %
Litigation settlement (2) - (27,000 )
Other non-recurring items (2) - 5,749
Provision for income taxes     40,135       39,367     2.0 %
Adjusted EBITDA (Non-GAAP)   $ 155,671     $ 132,735     17.3 %
Net earnings (per GAAP) $ 69,487 $ 69,143
Add (Less):
Loss on extinguishment of debt (1) 3,231 -
Litigation settlement and other non-recurring items, net (2) - (21,251 )
Tax provision for the adjustments to net earnings (3)     (1,163 )     7,863      
Adjusted net earnings, excluding non-recurring items (Non-GAAP)   $ 71,555     $ 55,755     28.3 %
 
Adjusted net earnings per share (Non-GAAP):
Basic $ 0.39 $ 0.30 30.0 %
Diluted $ 0.38 $ 0.30 26.7 %
Weighted average shares:
Basic 182,756 183,164
Diluted 188,496 188,592
               
(1)     For the three months ended June 30, 2012, interest expense includes $3.2 million in unamortized deferred financing costs expensed in connection with the Company's May 2012 repayment in full of its senior term loan B.
(2) Results for the three months ended June 30, 2011, reflect a $27.0 million benefit of a litigation settlement and non-recurring charges of $5.7 million. The net favorable impact of these items is $21.3 million.
(3) The tax provisions for the adjustments to net earnings were calculated using an estimated effective tax rate of 36.0% and 37.0% for the periods ended June 30, 2012 and 2011, respectively.
 

About Sally Beauty Holdings, Inc.

Sally Beauty Holdings, Inc. (NYSE: SBH) (the "Company") is an international specialty retailer and distributor of professional beauty supplies with annual revenues of $3.3 billion. The Company operates primarily through two business units, Sally Beauty Supply and Beauty Systems Group (BSG), and is the largest distributor of professional beauty supplies in the U.S. based on store count. The Sally Beauty Supply and Beauty Systems Group businesses sell and distribute through over 4,300 stores, including 185 franchised units, throughout the United States and Puerto Rico, the United Kingdom, Belgium, Canada, Chile, Mexico, France, Ireland, Spain, Germany and the Netherlands.

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