Good morning and thank you for joining the Regis First Quarter 2023 Earnings Release Conference Call. All participants are in a listen-only mode. The prepared remarks by our President and Chief Executive Officer, Matthew Doctor; and Executive Vice President and Chief Financial Officer, Kersten Zupfer are accompanied by the slides to help participants follow on. After the prepared remarks, we will have time for questions. Please use the chat feature or raise your hand feature to ask a question. Also joining Matt and Kersten on this call is Jim Lain, our Chief Operations Officer. I am your host, Biz McShane, Vice President, Corporate Controller. As a reminder, this conference is being recorded. I'd like to remind everyone that the language on forward-looking statements included in our earnings release and 8-K filing are also applied to our comments made on the call today. These documents along with our presentation can be found on our website www.regiscorp.com/investorRelations along with the reconciliation of any non-GAAP financial measures mentioned on our call today with the corresponding GAAP measure. Today's slides are also located in the Supplemental Financial section of the Investor site. With that, I will now turn the call over to Matt.

Thank you, Biz. Good morning, everyone, and thank you for your interest in Regis. I am excited to speak with you today and share our results for the quarter. Over the past several quarters, perhaps even years, we've been discussing what our company will look like and what the results should be on the other side of completing the transition to a fully franchised model and winding down our legacy businesses. Over the course of the past year, we've made significant progress on this front. As I mentioned on our last call, we should start demonstrating positive EBITDA going forward, and we are starting to do exactly that. We have come a long way through the hard work and resilience of the Regis team and our franchise, and that effort is reflected in our results. I am pleased to share our positive start to the year with the first quarter marking key milestones as we progress towards advancing our strategy. To this end, in the first quarter, we generated more EBITDA than all of fiscal 2022, and we recorded positive operating income for the first time since the quarter ended September 30, 2018. While we have certainly come a long way, I would be remiss if I didn't acknowledge that there is still significant work ahead. Work that we are addressing head-on through the initiatives we have in place and have discussed at length on previous calls. We have a strong conviction that they are the right ones to capitalize on the foundational work that has transformed Regis into an asset-light franchise model. With a durable balance sheet, talented team, and dedicated franchisees, we continue to be laser-focused on providing our franchisees with the tools to ensure we continue to build on the momentum we are gaining, and pave the way for a bright future for the entire Regis system. For today's call, I will highlight our results, share the progress we've made on our strategy, and review the priorities we have for the business as we enter the second quarter and for the full fiscal year. Delving deeper into our first quarter results, same-store sales rose 4.5% compared to the prior year's first quarter. Adjusted EBITDA on a consolidated basis was $3.8 million, compared to a loss of $5 million in the prior year's quarter, an improvement of $8.8 million. Our franchise segment EBITDA was $5 million, increasing $8.5 million from a loss of $3.5 million in the first quarter of fiscal 2022. Our franchise segment EBITDA continues its positive trend, representing yet another quarter of strong franchise EBITDA growth. As I mentioned in my opening remarks, we reported positive operating income of $2.5 million versus a loss of $4.9 million in Q1 of fiscal 2022, marking the first quarter of positive operating income in 16 quarters. Another financial highlight is our decreased cash use, as we've come a long way from the cash use we've seen over the past two years. Kersten will provide more details on this later during her remarks. Our liquidity position and capital structure remain strong having successfully renegotiated our credit agreement during the quarter. We ended the quarter with total liquidity of $48 million providing us ample runway to continue investing in and improving the business. Now turning to our business initiatives, operationally, we are sticking with the game plan and must stay on top of those items directly in our control that will have an impact, such as reducing G&A and winding down company-owned salons. We are also focused on driving salon-level sales and productivity with our initiatives in technology, stylist retention, recruitment, and marketing expected to do just that. I want to take a moment to touch on the areas within our control, as the team has done an excellent job of managing G&A while more aggressively winding down our company-owned salons. These actions will be instrumental in providing us the runway needed to drive the turnaround and position Regis for growth. We have been closely managing G&A and are pleased with where this is arriving. Kersten will update you later in the call with more details on G&A and the expectation for continued improvement in our annual outlook for this metric. In addition to G&A, we have directed our real estate team to take an even more urgent approach to aligning company-owned salons. We ended the quarter with 95 company-owned salons, and we currently stand at 90 as of the end of October. These acceleration efforts should start bearing fruit in the coming quarters, as getting out of these salons will help us avoid future losses, which would further benefit our results. Moving on to our core salon initiatives: technology, stylist retention, recruiting, and marketing; our priorities remain the same as I laid out on previous calls. On the technology front, we are focused on the rollout of the Zenoti platform across our salons. Since completing the deal, we have deployed Zenoti in our rosters brand and have had franchisees from our other brands run pilot tests to ensure the product's functionality meets the needs of our salons. Our franchisees and Zenoti have collaborated throughout this process, as Zenoti has been very responsive in acknowledging and completing the necessary work in a timely manner. I am encouraged that this partnership is set up to be successful. After months of work, we are on the cusp of accelerating the rollout with the right feature set that meets the unique demands of all of our brands. Our expectation is that during this month of November, weekly migration rates will ramp up into the triple-digits, leading us to complete the rollout by the end of our fiscal year. As discussed, we believe our franchisees will benefit significantly from the targeted marketing platform, improved guest communication tools, greater product stability, and many other features found on Zenoti. It should also be noted that during the quarter, we received $4 million in proceeds related to the refinancing holdback, as well as an additional $500,000 in October, bringing the total cash proceeds of $17.5 million from the sale thus far. As a reminder, all proceeds will go towards repaying our bank debt. Regarding stylist retention and recruitment and other customer marketing efforts, I will mostly be reiterating the initiatives we have in place and will reserve more details and updates for subsequent calls. I mentioned on the previous quarter's call that we expect these initiatives to be largely in effect by the end of the calendar year. So we will likely start measuring and discussing results more robustly during the latter half of fiscal 2023. That said, we are starting to execute our stylist retention and recruitment efforts with two major work streams. The first is our increased investment in stylist support and educational efforts, as well as recruitment-focused marketing. In terms of our increased educational front, our artistic directors have been returning to the salon regularly for the first time in years, providing live, customized, hands-on training across our entire Supercuts brand. We are also training a large number of franchisee technical trainers, further expanding the reach of our educational teams. We're increasing our visits to beauty schools and collecting current enrolling contact information to ensure we maintain dialogue with them as they progress through their education with the goal of engaging them when they seek jobs upon graduation. In addition to the technical aspect, we are creating salon manager and leader training modules to focus on the soft skills needed to create the right environment and culture for stylists in our brands, as retention is just as important as a strong pipeline of candidates. Our incentive award and advanced education trips have officially kicked off, as we hosted our first event in mid-October in Las Vegas, with the next one to follow in January that will be attended by over 1,000 managers, stylists, and owners. The second major work stream here is recruitment marketing. We have just started testing some collateral across immediate channels to gauge where we achieve the best return. We view this work as preliminary and see it as laying groundwork to better understand where messages resonate with stylists, enabling us to deploy newly developed creative assets across the channels with the best ROI. In the meantime, we're working on unique ways to convey our employer value proposition and ensure our story stands out amongst the competition on both social and digital platforms. More updates on these efforts will come as we progress throughout the year. On the customer and marketing front, our goal remains to drive traffic through better customer retention and build further stickiness and loyalty to our brands. We have begun shifting our media spend to optimize search and social channels, and we are developing CRM test campaigns through both email and SMS text messaging for the first time, aiming to launch some of these initial test campaigns during November. We have kicked off the design phase of our branded loyalty programs and are gearing up for holiday promotions to capitalize on these high-volume months. We are also excited to launch what we believe will be a differentiated structured approach to our brand's promotional calendar efforts. Starting in December, we will release the first of our new seasonal trend promotional calendars for most of our brands to create more consistent brand stories and drive incremental service and retail add-ons, along with educational tie-ins for stylists. Given our scale, we believe we should not be reactive to trends but rather drive them. Each seasonal trend will focus on services and retail for each month within the season, aiming to drive incremental sales. We believe this will be a strong marketing tool and also another piece in the stylist recruitment and retention story, as stylists will receive new and exciting educational training on relevant trends consistently. This represents yet another item we are launching that we believe we can execute on a scale that cannot be matched. I look forward to updating you on the progress of these initiatives as we move throughout the year. Before wrapping up on the initiatives, I would like to discuss one other important business item, salon closures. As part of our overall strategy, we will focus not only on closure mitigation but also closure optimization. Honestly, taking some steps back from a salon count perspective may be necessary to move forward, as carrying low-volume, loss-making salons is not the best use of time and money for us or our franchisees. While losing footprint is something that no system wants, we need to acknowledge the realities to ensure that when salons do close, we can manage customers and stylists accordingly to optimize and improve those salons that represent the strongest return potential, ultimately benefiting from the transfer of sales-generating capabilities through more stylists as we migrate to ongoing salons. To put this in context, the impact of salon closures is not a major financial drag. For example, these salons generally average under $100,000 in annual sales, translating to royalties of around $5,000 or less for Regis annually. Through optimizing closures and better managing our performing fleet, we believe we can strengthen the system for the long run and get back to a path of salon growth in the future. As I stated before, all of these initiatives aim to drive the core of our business, which is the need for trained stylists and customer traffic, which in turn will drive sales, productivity, and operating performance at the salon level. To underscore the importance of these initiatives, I mentioned previously that our entire company will share the same overarching KPIs to ensure we are aligned on moving the needle on the metrics that matter. Those targets and metrics aim to achieve the following outcomes, all with specific numerical targets and timelines: increasing stylist hours worked per salon per day, increasing 90-day customer retention, both laddering up to increasing overall sales, ensuring adoption of the Zenoti platform, and improving franchisee support scores by proactively seeking feedback from our franchisees and acting accordingly. These are the focused set of initiatives for the year, and we believe that if we drive improvement in these metrics, we can enhance our franchisees' profitability and subsequently improve Regis' business. As we begin the second quarter, our business is performing relatively in line with the first quarter. The challenges we face continue to be present, with sales reflecting the negative impact of labor constraints and shifts in customer behavior, such as the lengthening of haircut cycles. However, we are confident in our plans. Our initiatives are expected to address these challenges over time, as we enhance stylist retention and recruitment through increased investment in education, drive traffic with optimized marketing spend, and streamline operations with the proper technology solution in Zenoti. I want to thank the entire Regis system for their contribution to our performance. I am proud of all the team members, all of our franchise owners, and our business partners for their passion and dedication to Regis. We believe we have identified and are implementing the initiatives necessary to build upon our improved operating platform and deliver long-term sustainable growth. I am encouraged that we can point to our results this quarter as the inflection point we have been striving for, a testament to the work accomplished, and a glimpse into what we believe is an exciting future ahead.

Thanks, Matt, and good morning. We are pleased to share our first quarter performance, which demonstrated strong progress against our strategy to transform Regis into an asset-light franchise operator. This has led to continued improvements in profitability. Notably, the first quarter marked our initial period of positive consolidated operating income since September of 2018, driven by improved core revenue consisting of royalty and fee income and reductions in G&A. Net income also showed positive growth, increasing by $11.9 million to positive $1.5 million from a loss of $10.4 million in the first quarter last year. This increase reflects the improvement in income from operations and the gain associated with proceeds received from the sale of OSP to Zenoti, as Matt discussed. Overall, we are very pleased with our business progress. While total first-quarter revenues of $62 million declined by $15 million from the prior year as expected due to our transition to a fully franchised business model, core revenue improved by nearly $1 million due to higher average royalty rates. System-wide same-store sales increased by 4.5% in the quarter. We remain focused on implementing initiatives to drive system-wide sales growth, with actions aimed at improving stylist recruitment and training. Our goal continues to be to increase awareness of the opportunities and benefits stylists and beauty school students can expect from joining our organization. I want to address our adjusted results to eliminate noise in the reported results. On an adjusted basis, first-quarter consolidated adjusted EBITDA was $4 million compared to a loss of $5 million in the prior year's quarter. This improvement came from higher royalties and our lower cost structure. Our adjusted G&A for the quarter was $14 million, which was lower than the expected run rate due to the timing of filling open positions and stylist recruiting events. We continuously review our G&A structure and have reduced our expected normalized G&A run rate from $60 million to $63 million down to $57 million to $60 million annually. Our core franchise business achieved adjusted EBITDA of $5 million, an $8 million improvement compared to a loss of $3 million in the prior year. Core business results continue to be driven primarily by higher royalties and our right-sized G&A structure. We narrowed our company-owned segment's adjusted EBITDA loss to approximately $1 million, a $0.4 million improvement in adjusted EBITDA from the same period last year. The improvement is primarily related to having fewer loss-generating company-owned salons in the current period. Prior period results were boosted by Canadian COVID relief benefits of $1.7 million. Excluding these benefits, company-owned adjusted EBITDA increased by $2 million. As Matt mentioned earlier, company-owned salons continue to be a drag on the business, and our real estate team is focused on aggressively exiting these loss-generating salons. Turning to liquidity, as of September 30, we had $48 million of liquidity, including $38 million of available revolver capacity and $10 million of cash. In the first quarter, we used $5 million of cash from operations, which is an improvement of $7 million from the prior year. This $5 million includes our annual bonus payment and annual insurance prepayment, as well as $1.3 million of other one-time payments. This is the closest we have been to generating cash from operations since the fourth quarter of fiscal year 2019, and we expect our cash used in operations to continue to decline as sales and customer traffic improve. Additionally, with the sale of OSP, our expected future capital expenditures will be around $1 million for the year. Given our working capital and modest capital expenditure requirements, we believe we have ample liquidity. This concludes my prepared remarks. I'd like to thank you for your continued support and interest in Regis, and I look forward to speaking with you at upcoming investor conferences, including the Wolf Consumer Conference in December and the ICR conference in January. I will hand it back to Biz, who will lead us through the Q&A.

Thank you, Kersten. As a reminder, please use the raise your hand or Q&A feature to ask a question. The first question that we received was about the trends in the sales channel. We are hearing about other companies in the beauty industry where customers are spacing out time between appointments longer due to financial stress.

Yeah. Sure. Thanks for the question. It's Matt. I touched on this a little bit earlier regarding some of the trends in consumer behavior. It's certainly something that we're seeing, not necessarily even due to financial stress, but I'd probably say the other word I'd use is inconsistent since COVID, inconsistent between the length of the cycles, the longer hair, hairstyles, who they’re going to, and how long this will last. What I would say is, even in this environment, there are still significant opportunities for us to ensure that even those who may be visiting less still stay with us and don’t go elsewhere. So getting back to that point of customer retention and doing a better job there will have a positive impact. Also, there's the opportunity to drive new traffic and keep them as well. So even in this environment, those two will still be net positives. Going back to something I said in the call, we can capitalize on driving some trends. I mean actual hairstyle trends, versus visitation trends. Having these folks within our salons, we can build service tickets to the promotional calendars we’re talking about, hopefully ensuring that when folks come in, we’re the salons they look forward to visiting for their baseline service as well as driving trends in hair and giving them further reasons to return versus just the usual, which is totally okay. All right. Well, we're not seeing any further questions here. I appreciate everyone joining. I just want to say that we probably won't be speaking to you until the New Year. So have a happy and healthy holiday season, and I look forward to speaking to you all when we report second-quarter results. Thank you.