Top Companies Report

17. Revlon

July 11, 2011

New York, NY

212.527.4000

www.revlon.com

Sales: $1.3 billion


Sales:

$1.3 billion. Net income: $66.7 million.


Key Personnel:

David L. Kennedy, vice chairman; Alan T. Ennis, president and chief executive officer; Chris Elshaw, executive vice president and chief operating officer; Steven Berns, executive vice president and chief financial officer; Julia Goldin, executive vice president, global chief marketing officer; Robert K. Kretzman, executive vice president and chief administrative officer; Alan Meyers, executive vice president and chief science officer; Manuel Blanco, senior vice president and managing director, Latin America region; John Collier, senior vice president and general manager, US; Arthur Franson, senior vice president, global supply chain and manufacturing; David Teasdale, senior vice president and managing director, Asia Pacific; Mark Wood, senior vice president and managing director, Europe, Middle East and Africa; Simon Worraker, senior vice president and general manager, Canada.

 

Major Products:

Cosmetics, women’s hair color, beauty tools, fragrances, skin care, antiperspirants/deodorants and personal care products marketed under such names at Revlon, Almay, ColorSilk, Mitchum, Charlie, Gatineau and Ultima II.


New Products:

Skin care—Age Defying with DNA Advantage Cream Makeup; Color cosmetics—Grow Luscious Plumping Mascara and Lash Liner, Colorstay Aqua Mineral Finishing Powder, Summer Romantics collection, Sinful Colors (acquisition).


Comments:

Sales rose 2% to $1.3 billion and net income increased more than 36% last year. The company credited the gains to higher net sales of Revlon color cosmetics and Revlon ColorSilk hair color, which were partially offset by lower net sales of Almay color cosmetics and Mitchum antiperspirant deodorant. As previously disclosed, effective for periods beginning Jan. 1, 2010, the company reports Canada separately and reports South Africa as part of the Europe, Middle East and Africa region. As a result, prior year quarterly and year to date amounts have been reclassified.


In the US, net sales declined 2.5% to $729.1 million, due primarily to lower net sales of Almay color cosmetics, Revlon ColorSilk hair color and Mitchum antiperspirant deodorant, partially offset by higher net sales of Revlon color cosmetics. Net sales of color cosmetics benefitted from lower promotional allowances as the company continued to optimize its brand support mix, and also benefitted from lower returns.


In Asia Pacific, net sales rose 11% to $209.9 million. Excluding the favorable impact of foreign currency fluctuations, net sales increased $6.0 million, or 3.2%. Higher net sales of Revlon color cosmetics, Revlon ColorSilk hair color and other beauty care products in the region were partially offset by lower net sales of Revlon color cosmetics in Australia and Japan.


In Europe, Middle East and Africa, net sales increased 9% to $200.4 million. The increase was primarily due to higher net sales of fragrances throughout the region as well as higher net sales of color cosmetics and other beauty care products in South Africa.


In Latin America, net sales fell about 1% to $107.9 million, due primarily to currency fluctuations. Excluding fluctuations, Latin American sales rose 29.5% due to sales of Revlon ColorSilk hair color, Revlon color cosmetics and other beauty care products in both Venezuela and certain distributor markets.


In Canada, net sales increased nearly 12% to $74.1 million. Excluding the favorable impact of foreign currency fluctuations, net sales in Canada increased $1.4 million, or 2.1%. The increase was primarily driven by higher net sales of Revlon color cosmetics, which were partially offset by lower net sales of Revlon beauty tools.


For the first quarter of 2011, net sales rose 9.1% to $333.2 million. The increase was primarily due to higher net sales of Revlon color cosmetics, as well as Almay color cosmetics, fragrances, and other beauty care products, which were partially offset by lower net sales of Revlon ColorSilk hair color.


In the US, net sales increased 2.3% to $186.2 million. The increase was driven primarily by higher net sales of Revlon and Almay color cosmetics, which were partially offset by lower net sales of Revlon ColorSilk hair color. Net sales of Revlon color cosmetics increased in part due to lower promotional allowances as compared to the first quarter of 2010.


In Asia Pacific, net sales increased 15.7% to $53.1 million, primarily due to higher net sales of Revlon color cosmetics in China and certain distributor markets.


In Europe, Middle East and Africa, sales increased 15.9% to $49.7 million, thanks to higher net sales of Revlon color cosmetics, Mitchum antiperspirant deodorant and fragrances in the UK and South Africa.


In Latin America, sales rose 35% to $27.0 million, on the strength of higher sales of Revlon color cosmetics, Almay color cosmetics, Revlon ColorSilk hair color and other beauty care products. Finally, in Canada, sales increased 17.8% to $17.2 million, primarily due to higher net sales of Revlon color cosmetics.


Net income soared more than 400%, to $10.4 million, compared to $2.2 million a year ago.


Last month, a fire destroyed a substantial portion of Revlon facility in Venezuela. At press time, the company was evaluating the extent of the damage and the impact on its business in the Latin America region. During 2010, the company’s subsidiary in Venezuela had net sales of approximately 3% of the company’s consolidated net sales and its total assets were approximately 3% of the company’s total assets. Revlon’s net sales in Venezuela are comprised of locally manufactured product as well as product imported from its Oxford, NC facility.

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