Updated from 9:00 AM EST.
Shares of Sally Beauty (SBH) were falling 16.79% to $24.23 in mid-morning trading on Tuesday after the company reported downbeat results for the 2016 fiscal fourth quarter.
The Denton, TX-based beauty supplies retailer posted adjusted earnings of 41 cents per diluted share on revenue of $976 million. Analysts surveyed by FactSet were projecting earnings of 41 cents per share on revenue of $991 million.
Same-store sales rose 1.2% in the quarter, but missed Wall Street's expectations for an increase of 2.3%, according to FactSet.
Revenue increased 1.3% year-over-year, primarily due to same-store sale growth and the addition of new stores.
However, Sally issued upbeat guidance for same-store sales in fiscal 2017. The company sees same-store sales increasing about 3% for the full year, while analysts surveyed by FactSet are looking for growth of 2.8%.
Additionally, the company appointed Donald Grimes as CFO and COO effective December 12. Previously he was the CFO and COO at luxury retailer Neiman Marcus.
In late September, former CFO Mark Flaherty resigned his position. Janna Minton, the chief accounting officer and controller, has been the interim principal financial officer.
"In Sally, our in-store investments are mostly behind us and the Sally team is focused on the next phase of customer conversion and engagement," CEO Chris Brickman said in a statement.
The company has been improving the look of its stores through remodeling and adding new studios, including for nails and cosmetics.
"We believe the combination of sales growth and gross margin expansion will lead to mid-single digit operating earnings growth (in 2017)," he added.