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September 4, 2009

Clorox Delivers Solid Fiscal 2009, 4Q Results

Clorox reported solid earnings growth driven by stable sales and strong gross margin expansion for its fourth quarter and fiscal year 2009 ended June 30, according to the company. Fourth-quarter 2009 net earnings increased 8% to $170 million. Sales were unchanged at $1.5 billion, compared with the year-ago quarter.

“I’m extremely pleased with our strong performance in the fourth quarter, especially given continued economic pressure on consumers,” said chairman and chief executive officer Don Knauss.

For the fiscal year 2009, sales for fiscal 2009 grew 3% to $5.5 billion. Net earnings rose 16% to $537 million.

Commenting on the company’s fiscal year 2009 results, Mr. Knauss said, “The organization delivered strong results in fiscal 2009. We made significant progress against our Centennial Strategy. We drove sales growth on core businesses…and we maintained our all-outlet market share. We returned to annual gross margin expansion for the year and, despite the challenging economic environment, we’re continuing to invest in the long-term health of our brands.”

Clorox also confirmed its fiscal year 2010 financial outlook, with an estimation of 1-2% sales growth.

Revlon Reports 12.2% Decrease in Sales

Even with a slew of innovative rollouts for the summer season, the U.S. mass color cosmetics category has slowed down considerably due to the economy—even at the leading companies. Revlon, Inc. posted a 12.2% drop in net sales of $321.8 million for the second quarter ended June 30, 2009.

The decline in net sales was driven by lower net sales of Revlon and Almay color cosmetics, partially offset by higher net sales of Revlon ColorSilk hair color, according to the company.

In the U.S., net sales in the second quarter of 2009 slipped 14% to $186.2 million. In international operations, net sales in the second quarter of 2009 fell 14.5% to $135.6 million.

Net sales in the first six months of 2009 decreased 7.8% to $625.1 million. In the U.S., net sales dropped 4.2% to $377.2 million; while in the company’s international operations, net sales fell 12.9% to $247.9 million.

Revlon president and chief executive officer Alan T. Ennis commented, “We continue to focus on building our strong brands and are pleased with the performance of our key innovative new product launches, which we supported with appropriate levels of advertising and promotion.

“In the second quarter of 2009, while the mass color cosmetics category in the U.S., according to ACNielsen, continued to grow, the rate of growth slowed and certain retailers reduced inventory levels versus the year-ago period. These factors, along with the unfavorable effect of foreign currency fluctuations, impacted our second quarter results,” he continued.

In May, Revlon announced a worldwide organizational restructuring, rightsizing the organization to reflect the more efficient workflows and processes that have been implemented during the past two years.

A Profitable Quarter for Colgate-Palmolive

Things are looking brighter at Colgate-Palmolive. Besides recently ranking No. 2 in Happi’s Top 50 with annual sales of $13.1 billion, second-quarter profit rose 13.7% to $561.6 million in the company’s latest financial report. However, net sales fell 5.5% to $3.75 billion.

Avon’s 2Q Sales Down 10%

Avon Products, Inc. reported second-quarter 2009 total revenue of $2.5 billion, 10% lower than 2008. Beauty sales in the second quarter 2009 were also 10% lower versus the prior-year period. Active representatives grew 11%. Units overall rose 2% and beauty units increased 3%.

As previously reported in Happi, second-quarter 2009 expenses included costs associated with Avon’s 2009 and 2005 restructuring programs totaling $89 million.

Quarterly Drop at Bare Escentuals

For a company on the rise, even Bare Escentuals Inc. has taken a financial hit this year. For the three months ended June 28, profits at the mineral makeup giant slipped 20% to $19.8 million. Net sales dropped 4.4% to $132.5 million.

However, compared with the prior-year period, North American retail sales rose 5.2% in the quarter to $77.9 million, while direct-to-consumer sales declined 19.5% to $39 million. International sales dropped 2.7% to $15.6 million in the quarter.

For the first six months of fiscal 2009, Bare Escentuals’ net income declined 27.8% to $36.5 million.

A Tough Quarter for Culver

Alberto Culver Company reported that net sales for the third quarter decreased 3.6% to $351.6 million. Net sales for the nine-month period decreased 0.8% to $1.05 billion. Commenting on the results, Alberto Culver president and chief executive officer V. James Marino said, “Despite a prolonged softness in hair care, we continue to outpace the category and capture record shares for Alberto Culver.

“Our business and brands remain healthy as evidenced by our hair care consumption trends. We generated strong cash flow during the quarter and are very pleased with our results and the momentum that many of our brands have in the market.”

Inter Parfum’s Sales Fall 10% in Second Quarter Report

Inter Parfums, Inc.’s net sales for the second quarter fell 10.6% to $88.6 million. Through the first half of 2009, net sales were $179.0 million, or 19.4% below the $222.2 million reported in the first half of 2008. At comparable foreign currency exchange rates, net sales were down 13%.

“In light of the worldwide decline in consumer spending and the corresponding destocking of fragrance inventories by distributors and retailers, our 10.6% decline in net sales is rather modest and considerably less than many of our peers,” explained Jean Madar, chairman and chief executive officer.

“Of that amount, the continued strength of the U.S. dollar relative to the euro, was responsible for about 6.5% of the decline.

“As was the case in the first quarter, the second quarter bar was set quite high last year when sales by European-based operations were 19% ahead of the same period one year earlier with much of the gain due to the rollout of Burberry The Beat.

“Of special note, Lanvin, our second largest prestige brand, has proven somewhat resilient to the economic downturn with year-to-date sales running 25% ahead of last year due to the continued strength of Eclat d’Arpège, reorders of Jeanne Lanvin which debuted in the fall of 2008, and the good response to Lanvin L’Homme Sport this spring,” he said.

Second Quarter Slip at Symrise

Second-quarter earnings were impacted at Symrise due to restructuring expenses and high material costs, according to the company. Net income dropped 44% to $27.3 million. Total revenues stayed flat at $461 million.

The Symrise scent and care division posted a 40.3% decrease in earnings to $18.4 million. However, sales remained even at $223.1 million.