Today, Regis Corporation (NASDAQ:RGS), a leader in the personal services industry with a market capitalization of $57 million and significant recent stock volatility, disclosed the upcoming departure of a key executive. John Davi, the company's Executive Vice President and Chief Digital Officer, will see his position eliminated as of January 31, 2025. According to InvestingPro data, the company's stock has experienced a dramatic 112% gain over the past year, despite a concerning 28% decline in the last six months.
The company's filing with the Securities and Exchange Commission indicated that Davi is entitled to severance benefits under the Amended and Restated Senior Executive Severance Policy, contingent upon his adherence to certain conditions. To qualify for these benefits, Davi must sign a transition and separation agreement, fulfill the obligations within, and provide a release that he does not rescind.
Further details reveal that Davi will remain with Regis Corporation in a non-officer capacity until March 31, 2025, to assist with the handover of his duties. During this transition period, he will retain his current compensation.
In other recent news, Regis Corporation has reported mixed results in its first-quarter fiscal 2025 results, with total revenues falling to $46.1 million, a $7.3 million decrease from the previous year due to lower franchise rental income and advertising fund revenue. Despite this, adjusted EBITDA improved to $7.6 million, with margins expanding to 40%.
In a strategic move, Regis Corporation acquired Alline Salon Group, its largest franchisee, for an initial consideration of $22 million, potentially increasing by $3 million in earn-out payments over the next three years. This acquisition includes 314 salons operating under various brands, primarily in Michigan, Ohio, and Pennsylvania, which reported revenues of $83 million leading up to October 2024.
In other board changes, Susan Lintonsmith, known for her leadership roles at Quiznos and Elements Massage, has been appointed to the Board of Directors of Regis Corporation. Lintonsmith's extensive experience in franchise and public company operations is expected to provide valuable strategic insights for the company's future initiatives.
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