Revenue during the quarter dropped 5.87 percent to $424.04 million from $450.47 million in the previous year period. Gross margin for the quarter contracted 81 basis points over the previous year period to 39.90 percent. Operating margin for the quarter stood at negative 0.20 percent as compared to a negative 0.64 percent for the previous year period.

Operating loss for the quarter was $0.85 million, compared with an operating loss of $2.88 million in the previous year period.

However, the adjusted operating loss for the quarter stood at $0.17 million compared to operating loss of $0.80 million in prior year period.

Dan Hanrahan, president and chief executive officer, commented, "The strength of our franchise business was demonstrated in a challenging second quarter retail environment as our franchisees once again posted positive same-store sales results. Our franchisees have now posted positive annual same-store sales growth for 10 consecutive fiscal years. We have made a serious commitment to transform our business operationally and strategically to drive improved shareholder value. We intend to operate our salons successfully, sell certain salons to franchisees and continue to close underperforming salons. As I mentioned last quarter, we are committed to a thoughtful, well planned strategic transformation that increases the scale of our franchise business. To accelerate our goal of improved performance across a broader base of our salons, we announced last quarter we intended to expand our franchise model and that we had formally engaged Huron Business Advisory to assist in the analysis and development of the best means of delivering an accelerated and expanded franchise business model. While still in the early stages, we are pleased by our progress to date working in collaboration with Huron. We expect our initial focus will be on franchising our underperforming company-owned SmartStyle salons located in Walmart. We believe this presents an opportunity for our existing and new franchisees as these locations have built-in Walmart guest traffic which can be coupled with franchise operators who have proven capabilities to react nimbly to local conditions and the market knowledge to implement necessary changes to operations, stylist labor, wages and pricing to improve front-line salon performance. In December, we issued our Franchise Disclosure Document for SmartStyle salons in Walmart. This enables us to actively market and franchise this concept and the initial response from our franchisees and new prospective franchisees for this concept has been positive."

The company has spent $17.33 million cash to meet investing activities during the first six months as against cash outgo of $15.42 million in the last year period. It has incurred net capital expenditure of $18.07 million on net basis during the first six months, up 24.78 percent or $3.59 million from year ago period.

The company has spent $1.11 million cash to carry out financing activities during the first six months as against cash outgo of $78.40 million in the last year period.

Cash and cash equivalents stood at $155.64 million as on Dec. 31, 2016, up 19.58 percent or $25.49 million from $130.15 million on Dec. 31, 2015.

Working capital increases
Regis Corp has recorded an increase in the working capital over the last year. It stood at $183.89 million as at Dec. 31, 2016, up 16.07 percent or $25.46 million from $158.43 million on Dec. 31, 2015. Current ratio was at 1.98 as on Dec. 31, 2016, up from 1.77 on Dec. 31, 2015.

Cash conversion cycle (CCC) has decreased to 6 days for the quarter from 31 days for the last year period. Days sales outstanding were almost stable at 6 days for the quarter, when compared with the last year period.

Days inventory outstanding has decreased to 24 days for the quarter compared with 49 days for the previous year period. At the same time, days payable outstanding was almost stable at 24 days for the quarter, when compared with the previous year period.