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Sally Beauty Holdings, Inc.As of September 2019

beautyin motion

Sally Beauty Holdings is an international specialty retailer and distributor of professional hair color, hair care, and other beauty

products and supplies

Differentiated industry position, underpinned by resilient hair color and hair care categories

Annual consolidated sales of approximately $4 billion

5,061 stores located in 12 countries (1)

Strong owned and exclusive brand penetration

Strong cash flow generation

Proven resilience in recessionary cycles

Two distinct business segments

Diversified customer base: 60% salon professional; 40% specialty retail

Company Highlights

(1) As of September 30, 20192

Segments

Net Sales Gross Margin

% of SegmentOperatingEarnings

(1) See Addendum for a reconciliation of this non-GAAP financial measure.

Consolidated Fiscal 2019 Results

% of Sales 59.2% 40.8%

60.5% 39.5%

3

Open-Line Retail Exclusive / Full-Service

3,695 stores 1,366 stores 748 consultants

Professional stylists

`

Consumers:

DistributionChannel (1)

Salons

Retail Consumers $$$ High-end$ Value

Suppliers/Vendors:

Distributors:

Go To Market

Exclusive, third party professional-only brands

Third party and owned brands not available in mass retail

(1) As of September 30, 2019 4

Retail stores and e-commerce

Retail consumers ~ 70% of sales

Professional stylists ~ 30% of sales

SalesSSSEBITEBIT margin

Segment

DistributionChannel

Customers

FY2019Financials

$2.3b0.4%$366m16.0%

Business Segment Highlights

5

SalesSSSEBITEBIT margin

Segment

DistributionChannel

Customers

FY2019Financials

Stores and e-commerce for licensed professionalsDirect sales consultants and e-commerce for salons

Professional stylists (chair/suite renters)

Salons (via BSG’s direct sales consultants)

$1.6b0.2%$240m15.1%

Business Segment Highlights

6

Business Segment Review7

Sally Beauty global footprint (1)

3,695 stores worldwide 2,791 stores in U.S. (including Puerto Rico)

904 stores in Canada, Mexico, Chile, Peru, UK, Ireland, Belgium, Netherlands, France, Germany, and Spain

Average store size 1,700 sq. ft., 90% selling space

Professional open-line business - merchandise assortment not available through mass retailers

Launched new mobile-first e-commerce platform in March of 2019 and Sally app in June of 2019

44% of sales are owned-brand and exclusive products (1)

Sally Beauty U.S. Store

Sally Beauty Highlights

(1) As of September 30, 2019 8

20%

29%

15%

14%

7%

7%

8%

Sally Beauty Product Mix

Hair Care

Hair Color

Skin and Nail Care

Styling Tools

Salon Supplies andAccessories

Other BeautyItems

We offer a diversified mix of beauty products with a focus on hair color and care

*Fiscal year 2019

~50% ofSales areHair ColorHair Care

MulticulturalProducts

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Sally International

904 Sally stores located in 11 countries

Stores located in Canada, Mexico, Chile, Peru, UK, Ireland, Belgium, France, the Netherlands, Germany, and Spain

~25% of Sally sales from international

Sales mix differs from U.S./Canada

UK/Europe

o ~80-85% professionalo ~15-20% retail

Mexico and South America almost 100% retail

Existing International Platform Store Count by Geography (1)

248

201(Belgium, France,

139

37

262

Total 904

17

(Canada)

(Mexico)

(UK / Ireland)

Germany, Spain, Netherlands)

(Chile)

(Peru)

(1) As of September 30, 2019 10

2.1%

4.1%

6.3% 6.5%

-0.6%

1.3% 1.7% 1.7%

-1.6% -1.5%

0.4%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

$1,696 $1,835 $2,012

$2,199 $2,230 $2,309 $2,330 $2,365 $2,345 $2,334 $2,293

$0

$400

$800

$1,200

$1,600

$2,000

$2,400

$2,800

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Sally Beauty Net Sales (1)

Sally Beauty Same Store Sales

(1) The unfavorable impact of foreign currency exchange on net sales for the fiscal year 2019 was $27.4 million, or 1.2% of net sales

Sally Beauty Historical Sales

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Beauty Systems Group Highlights

Beauty Systems Group – 1,366(1) professional-only stores & professional distributor sales consultants

1,220 company-operated / 146 franchised stores (Armstrong McCall)

748 professional distributor sales consultants

Average store size 2,600 sq. ft.

Sells exclusively to salons and salon professionals

Professional exclusive / full-service business –includes merchandise assortment of premium brands sold through salons and generally not available in mass retail or Sally Beauty stores

52% of sales are exclusive and owned-brand products (1)

(1) As of September 30, 201912

35%

40%

3%

8%

8%6%

Beauty Systems Group Product Mix

We offer a diversified mix of beauty products not carried in Sally stores or mass retail

Hair Care

Skin and Nail Care

Styling Tools

PromotionalItems

Other BeautyItems

Hair Color

~75% of Sales areHair ColorHair Care

*Fiscal year 2019 13

Beauty Systems Group Historical Sales

$941 $1,081

$1,257 $1,325 $1,392 $1,445 $1,505 $1,588 $1,593 $1,599 $1,583

$0$200$400$600$800

$1,000$1,200$1,400$1,600$1,800

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

BSG Net Sales (1)

1.0%

6.2%5.5% 6.1%

4.2%3.5%

5.7% 5.5%

1.3%

(1.5%)

0.2%

(4.0%)

0.0%

4.0%

8.0%

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

BSG Same Store Sales Growth

(1) The unfavorable impact of foreign currency exchange on net sales for the fiscal year 2019 was $4.5 million, or 0.3% of net sales 14

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Consolidated Financials

$0.52

$0.77

$1.07

$1.42$1.48 $1.53 $1.53

$1.72$1.80

$2.16$2.26

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Consolidated Sales and Adj. EPS

Consolidated Sales (1) EPS (adjusted) (2)

(1) The impact from unfavorable foreign currency exchange in the 2019 fiscal year was $31.9 million, or 0.8%(2) See Addendum for a reconciliation of this non-GAAP financial measure. 16

$2,637

$2,916

$3,269

$3,524 $3,622 $3,754 $3,834

$3,953 $3,938 $3,933 $3,876

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

$4,500

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Q4 FY19 and Full Fiscal Year Results

Q4 FY19 Financial Results

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• Net sales of $966m, flat vs. prior year Consolidated same store sales growth +1.1% Unfavorable foreign exchange (70 bps) 95 fewer stores versus prior year

• GAAP EPS of $0.58, increase of $0.12 or 26.1% vs. prior year

• Adjusted EPS of $0.58, increase of $0.07 or 13.7% vs. prior year

• Cash flow from operations of $116.6m• Operating free cash flow of $78.9m

• Reduced debt levels by $16.9m and repurchased shares totaling $46.6m

Full Fiscal Year Financial Results

• Net sales of $3,876m, -1.4% vs. prior year Consolidated same store sales growth +0.3% Unfavorable foreign exchange (80 bps) 95 fewer stores versus prior year

• GAAP EPS of $2.26, increase of $0.18 or 8.7% vs. prior year

• Adjusted EPS of $2.26, increase of $0.10 or 4.6% vs. prior year

• Cash flow from operations of $320.4m• Operating free cash flow of $228.0m

• Reduced debt levels by $185m and repurchased shares totaling $46.6m

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Steady Cash Flow Generation

SBH Free Cash Flow ($m) (1)

$225.6$239.2

$194.3 $202.3

$253.7

$286.5

$228.0

2013A 2014A 2015A 2016A 2017A 2018A 2019A

49% 40%37% 39% 32% 32%

Cash conversion (%) (2)

(1) Free Cash Flow defined as cash flow from operations minus capital expenditures; See Addendum for reconciliation of this non-GAAP financial measure(2) Cash conversion defined as FCF/Adjusted EBITDANote: Free Cash Flow for 2015 and 2016 reflects increased capital expenditures primarily related to store openings and ongoing information technology upgrades

in both business segments, store remodels and upgrades to certain distribution centers

41%

Long-Term Capital Structure

No near-term maturities

Targeted consolidated leverage ratio (Net Debt/EBITDA) of 2.5x to 3.0x

Leverage 2.63x at September 30

Ample liquidity

Strong cash flow

$500 million asset-based revolving credit facility

Long-Term Debt Maturities ($ millions)

Consolidated Debt

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AMOUNT ($MM)

% OF TOTAL DEBT

TERM LOAN B (FY2024) $724.0 45.0% 5.500% SENIOR NOTES (FY2024) $197.4 12.3% 5.625% SENIOR NOTES (FY2026) $687.9 42.7% TOTAL DEBT $1,609.3 100.0%

$921.4

$687.9

$-

$200.0

$400.0

$600.0

$800.0

$1,000.0

$1,200.0

2018 2019 2020 2021 2022 2023 2024 2025 2026

Capital Allocation

$327

$228 $209

$346

$166

$47

2014 2015 2016 2017 2018 2019

Cash used per year to acquire stock(in millions)

Over past six years, $1.3 billion of capital allocated to stock repurchases

In August 2017, launched a new share repurchase program to repurchase up to $1.0 billion, at the discretion of the Board of Directors, of common stock through the end of fiscal year 2021

Going forward, capital allocation will be in order of priority: invest in the business, then pay down debt while being opportunistic in returning cash to shareholders

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21

Transformation Plan

OVERALL STRATEGY

Be the undisputed expert and leader in hair color and hair care for the consumer and the professional

Play to win with our customers

Improve ourretail

fundamentals

Advance ourdigital commerce

capabilities

Drive costs out of the business

Focus marketing and merchandising efforts in our differentiated core – Hair Color and Hair Care

• Build brands jointly with influencers

• Expand distribution rights of important color and care brands, and pursue additional new and exclusive brands, bringing new customers to Beauty Systems Group

• Enter a multi-billion dollar category by launching box color across Sally Beauty Supply

Targeted investment in people, processes, technology and our stores

• Leverage data via Loyalty programs to enhance our understanding of our business and customers

• Complete point-of-sale system and JDA implementation for both Sally Beauty and BSG

• Expanding the roll-out of our new store concepts to refresh/rebuild our store experience

• Modernize our supply chain

• Hire the best talent and leverage the Power of One

• Grow digital commerce capabilities and enhance online and mobile customer experience

• Further leverage commerce-based apps and other omni-channel capabilities to satisfy rapidly evolving customer expectations while showcasing key product categories

• Develop dynamic inventory delivery options including ship from store, buy online/pickup at store and split shipment

• Through continuous improvement efforts, achieve additional selling, general and administrative expense savings to offset inflation and wage pressure

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SBH Highlights

Differentiated industry position: hair color and hair care

Strong owned and exclusive brand penetration

North American and Global Reach

Team members are “Color Experts”

Strong cash flow generation

Proven resilience in recessions

Equal Share with All Grocery; Just Below All Drug

44% Owned/Exclusive Brand (SBS)52% Owned/Exclusive Brand (BSG) (1)

5,000+ Locations; 12 Countries; Close to Consumer

12,000+ Trained Cosmetologists or “Advanced Color” Certified by SBH

>$200M Free Cash Flow Each Year (2)

60% salon pros; 40% specialty retail(1) As of September 30, 2019(2) Free Cash Flow is a non-GAAP measure. See Appendix for a reconciliation of this non-GAAP measure.

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2

3

4

5

6

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APPENDIX

EBITDA and EPS Reconciliation

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Adjusted EBITDA FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19Net Earnings (GAAP) 99.1$ 143.8$ 213.7$ 233.1$ 261.2$ 246.0$ 235.1$ 222.9$ 215.1$ 258.0$ 271.6$

Interest expense, net of interest income 132.0 113.0 112.5 138.4 107.7 116.3 116.8 144.2 132.9 98.2 96.3Provision for income taxes 65.7 84.1 122.2 127.9 151.5 144.7 143.4 131.1 130.6 70.4 90.5Depreciation and amortization 47.1 51.1 59.7 64.7 72.2 79.7 89.4 99.7 112.3 108.8 107.7Share-based compensation 8.6 12.8 15.6 16.9 19.2 22.1 16.8 12.6 10.5 10.5 9.2Transaction expenses - - - - - - - - - - - Sales-based service fee charged by Alberto-Culver - - - - - - - - - - - Expenses from data security incidents - - - - - 2.5 5.6 14.6 - 7.9 - Restructuring charges - - - - - - 5.3 - 22.7 33.6 (0.7) Litigation settlement and non-recurring items, net (1) - - (21.3) 10.2 - - - 2.6 - - -

Adjusted EBITDA 352.5$ 404.8$ 502.5$ 591.1$ 611.8$ 611.3$ 612.4$ 627.7$ 624.1$ 587.4$ 574.6$

Adjusted net earnings and adjusted diluted earnings per shareNet Earnings (GAAP) 99.1$ 143.8$ 213.7$ 233.1$ 261.2$ 246.0$ 235.1$ 222.9$ 215.1$ 258.0$ 271.6

Marked-to-market adjustment for certain interest rate swaps - (2.4) - - - - - - - - - Expenses associated with the spin-off from Alverto Culver - - - - - - - - - - - Loss on extinguishment of debt (5.3) - - 37.8 - - - 33.3 28.0 0.9 - Interest expense on redeemed debt - - - 5.1 - - - 2.1 - - - Amortization of deferred financing costs - - - 0.2 - - - - - - - Litigation settlement and non-recurring items, net (1) - - (21.3) 10.2 - - - - - - - Loss from securiy breach incidents - - - - - 2.5 5.6 14.7 - 7.9 - Management transition costs - - - - - 3.5 - 2.0 - - - Restructuring charges - - - - - - 5.3 - 22.7 33.6 (0.7) One-time benefits from U.S. tax reform - - - - - - - - - (23.2) - Other - - - - - - - 0.6 - - - Tax provision for the adjustments to net earnings 2.1 0.9 7.9 (19.2) - (2.3) (4.0) (20.1) (17.6) (10.1) 0.6

Adjusted net earnings 95.9$ 142.3$ 200.3$ 267.2$ 261.2$ 249.7$ 241.9$ 255.6$ 248.2$ 267.1$ 271.5$ Diluted adjusted net earnings per share (non-GAAP): 0.52$ 0.77$ 1.07$ 1.42$ 1.48$ 1.53$ 1.53$ 1.72$ 1.80$ 2.16$ 2.26$ Diluted GAAP net earnings per share: 0.54$ 0.78$ 1.14$ 1.24$ 1.48$ 1.51$ 1.49$ 1.50$ 1.56$ 2.08$ 2.26$

(1) Results for fiscal year 2011, reflect a $27.0 million benefit of a litigation settlement and non-recurring charges of $5.7 million.

Free Cash Flow

25

Cash Flow Reconciliation2013 2014 2015 2016 2017 2018 2019

Cash Flow from Operations 310.5$ 316.0$ 300.8$ 351.0$ 343.3$ 372.7$ 320.4$ Less: Capital Expenditures 84.9$ 76.8$ 106.5$ 148.7$ 89.6$ 86.1$ 92.4$ Free Cash Flow 225.6$ 239.2$ 194.3$ 202.3$ 253.7$ 286.5$ 228.0$