Sally Beauty Holdings, Inc. Leases Disclosure
Our operating and finance leases consisted of the following (in thousands):
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September 30, |
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Balance Sheet Classification |
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2024 |
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2023 |
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Assets: |
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Operating lease (a) |
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Operating lease assets |
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$ |
582,573 |
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$ |
570,657 |
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Finance lease |
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1,553 |
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1,754 |
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Total lease assets |
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$ |
584,126 |
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$ |
572,411 |
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Liabilities: |
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Current: |
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Operating lease |
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Current operating lease liabilities |
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$ |
136,068 |
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$ |
150,479 |
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Finance lease |
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127 |
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173 |
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Long-term: |
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Operating lease |
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Long-term operating lease liabilities |
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479,616 |
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455,071 |
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Finance lease |
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— |
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119 |
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Total lease liabilities |
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$ |
615,811 |
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$ |
605,842 |
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Our lease costs consisted of the following (in thousands):
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For the Year Ended September 30, |
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Statement of Earnings Classification |
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2024 |
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2023 |
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Operating lease costs |
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Cost of goods sold and selling, general and administrative expenses (a) |
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$ |
179,121 |
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$ |
180,624 |
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Finance lease costs: |
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Amortization of leased assets |
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Selling, general and administrative expenses |
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291 |
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292 |
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Interest on lease liabilities |
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Interest expense |
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12 |
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12 |
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Variable lease costs (b) |
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Selling, general and administrative expenses |
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70,146 |
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59,996 |
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Total lease costs |
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$ |
249,570 |
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$ |
240,924 |
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As of September 30, 2024, the approximate future lease payments under our leases under ASC 842, Leases, are as follows (in thousands):
Fiscal Year |
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Operating leases |
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Finance leases |
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2025 |
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$ |
175,266 |
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$ |
137 |
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2026 |
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149,646 |
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— |
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2027 |
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121,159 |
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— |
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2028 |
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89,373 |
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— |
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2029 |
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59,092 |
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— |
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Thereafter |
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109,101 |
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— |
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Total undiscounted lease payments |
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703,637 |
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137 |
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Less: imputed interest |
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87,953 |
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10 |
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Present value of lease liabilities |
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$ |
615,684 |
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$ |
127 |
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The table above does not include operating leases we have entered into of approximately $4.0 million that have not commenced, primarily related to future retail stores.
Other lease information is as follows (dollars in thousands):
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For the Year Ended September 30, |
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2024 |
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2023 |
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Cash paid for amounts included in the measurement of lease liabilities: |
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Operating cash flows – operating leases |
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$ |
178,950 |
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$ |
182,405 |
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Operating cash flows – finance leases |
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12 |
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12 |
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Financing cash flows – finance leases |
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176 |
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176 |
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Supplemental non-cash information on lease liabilities: |
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Lease assets obtained in exchange for new operating lease liabilities |
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$ |
159,331 |
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$ |
184,039 |
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September 30, |
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2024 |
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2023 |
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Weighted-average remaining lease term (in years): |
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Operating leases |
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5.0 |
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5.2 |
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Finance leases |
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0.7 |
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1.7 |
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Weighted-average discount rate: |
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Operating leases |
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5.5 |
% |
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5.3 |
% |
Finance leases |
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0.3 |
% |
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0.3 |
% |
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2024 | Nov 14, 2024 | Showing above |
| 2023 | Nov 16, 2023 | |
| 2022 | Nov 17, 2022 | |
| 2021 | Nov 22, 2021 | |
| 2020 | Nov 24, 2020 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.