Revlon Inc announced results for the three months and year ended December 31, 2008.
2008 results compared to 2007:
• Net sales of $1,346.8 million compared to $1,367.1 million. Higher net sales of color cosmetics were offset by lower net sales of beauty care and unfavorable foreign currency fluctuations.
• Operating income of $155.0 million compared to $118.4 million.
• Net income of $57.9 million, or $1.13 per diluted share1, compared to a net loss of $16.1 million, or $0.32 per diluted share. Net income in 2008 includes discontinued operations2 of $44.8 million, or $0.87 per diluted share, of which $45.2 million, or $0.88 per diluted share, relates to the gain on sale of discontinued operations.
• Adjusted EBITDA3 of $248.1 million compared to $221.4 million.
• Positive free cash flow4 of $26.0 million compared to negative free cash flow of $17.1 million.
Commenting on today’s announcement, Revlon President and Chief Executive Officer, David Kennedy, said, “During the year, net sales growth in Revlon brand color cosmetics, which was driven by strong new product introductions and a more focused allocation of advertising and promotional expenditures, along with continued rigorous cost control, resulted in significantly improved financial performance. Specifically, and as we forecasted, the Company improved operating margins, profitability and generated positive free cash flow and net income. In addition, during 2008, we reduced debt by $110 million, improving our capital structure.”
Mr. Kennedy continued, "While we expect economic conditions and the retail sales environment to remain uncertain around the world, we believe we are better positioned than in many years to maximize our business results in light of these conditions. Specifically, we have strong global brands, a highly capable organization, a sustainable, reduced cost structure, and an improved capital structure. We are encouraged by the continued growth in mass channel color cosmetic consumption in the U.S. and in key markets around the world throughout 2008, despite the uncertain economic conditions.
We are also encouraged that, in January 2009, according to ACNielsen, the U.S. mass retail color cosmetics category expanded 3.6% and Revlon brand color cosmetics gained 0.7 percentage points, growing faster than the category, for a dollar share of 13.3%. We are continuing to execute our strategy and manage our business while maintaining flexibility to adapt to changes in business conditions.
We are also continuing our intense focus on the key growth drivers of our business, including innovative, high-quality, consumer-preferred products, effective integrated brand communication, appropriate levels of advertising and promotion, and superb execution with our retail partners, along with disciplined spending and rigorous cost control. Over time, we believe that with this focus we will generate profitable net sales growth and sustainable positive free cash flow."
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