Regis Corp. (NYSE:RGS) Q2 2016 Earnings Conference Call - Final Transcript
Jan 28, 2016 • 10:00 am ET
previous earnings call. As we have been stabilizing the business, we began to thoughtfully invest in stylist hours to grow guest traffic and we continued to do so during the second quarter. While this has a short term unfavorable impact on margins, we will not consistently grow our revenue and margin dollars without enough stylists in our salons.
Investments are focused on salons with the greatest needs to improve staffing and stylist scheduling in our salons. Making this investment is not simply a flip the switch decision. It requires execution across the board. As we add hours to grow the business, we monitor stylist productivity by salon and field leader to ensure the additional hours are becoming more and more productive. Our strategy is to staff the salon, coach stylists to commission, so they are earning well and work diligently to retain these productive stylists. The process is iterative and why I say our progress will not be linear.
To deliver more linear progress and consistent growth, we are focused on optimally balancing the investment in stylist hours with driving guest traffic and growing comps. Progress we've made in laying our foundation for the future, continuing field leadership training, development and upgrades, improvement in our execution capabilities each quarter and the fact that our best leaders grow comps following the investment in stylist hours gives me the confidence this investment will pay off longer-term.
Before concluding, I want to spend a few moments covering capital allocation. We continue to believe we have begun to stabilize our business. We're confident in our strategy and in the direction our business is heading. Our primary focus has been on stabilizing the core business and building the foundation for growth. As a result, we're not yet at a point where we can consistently deploy capital to grow our business by reinvesting salons where expected returns provide attractive rewards relative to risk taken.
Our default use of capital remains share repurchases at reasonable prices. In the first half of our fiscal year, we repurchased 6 million shares for $77 million at an average price of $12.90 per share. We will continue to follow our capital allocation policy by ensuring our balance sheet remains strong and deploying excess capital in a manner that maximizes shareholder value.
In a few moments, Steve will provide further color on this and recent modifications we made to our high yield notes and bank credit facility. I'm confident we are following the right strategies and I'm proud of our team for the progress in making Regis a place where stylists can have successful and satisfying careers. Our field leadership talent and execution capabilities are improving. We have work to do to drive sustainable growth in guest traffic which will enable us to realize the potential of each of our salons and result in long-term growth and shareholder value.
I'd now like to turn it over to Steve.
Thank you, Dan, and good morning. Before discussing our performance for the second quarter,