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Revlon Brand Color Cosmetics net sales up
16 Feb '09
6 min read
2008 Results:
Net sales in 2008 were $1,346.8 million, a decrease of $20.3 million, or 1.5%, compared to $1,367.1 million in 2007. Foreign currency fluctuations negatively impacted net sales by $8.3 million. Excluding foreign currency fluctuations, net sales of Revlon brand color cosmetics increased 9% driven by strong new product introductions (higher shipments and favorable product returns, partially offset by higher promotional allowances). Increased net sales of Revlon brand color cosmetics were offset by declines in net sales for Almay (higher shipments, offset by higher product returns and higher promotional allowances), and lower net sales of certain fragrance and beauty care brands.
In the United States, net sales in 2008 were $782.6 million, a decrease of $21.6 million, or 2.7%, compared to $804.2 million in 2007. Higher net sales of Revlon brand color cosmetics were offset by lower net sales of Almay, fragrance and beauty care products. In 2008, higher net sales of Revlon ColorSilk and Revlon beauty tools were offset by cycling the 2007 launches of Revlon Colorist hair color, Revlon Flair fragrance and Mitchum Smart Solid anti-perspirant deodorant.
In the Company's international operations, net sales in 2008 were $564.2 million, an increase of $1.3 million, or 0.2%, compared to $562.9 million in 2007. Excluding the unfavorable impact of foreign currency fluctuations of $8.3 million, net sales increased by 1.7% as a result of higher net sales of Revlon and Almay color cosmetics, Revlon beauty tools and Mitchum anti-perspirant deodorant, partially offset by lower net sales of fragrance and hair care products. Higher net sales in the Asia Pacific and Latin America regions were partially offset by lower net sales in the Europe region.
Consistent with the Company's business plan and the increased level of new product introductions, the Company supported its brands with advertising and promotions throughout the year. In 2008, advertising and promotional spending across all the Company's brands remained largely unchanged.
The Company increased spending on its color cosmetics brands, while spending on certain of its beauty care brands was lower as a result of cycling prior year spending on the launches of Revlon Colorist hair color, Revlon Flair fragrance and Mitchum Smart Solid anti-perspirant deodorant. These actions contributed to our performance in the marketplace in 2008 as reflected in the U.S. mass retail dollar share and dollar volume growth related to the Revlon and Almay brands in the segments in which our new product launches and advertising and promotional spending were focused.
Operating income in 2008 was $155.0 million, representing an 11.5% operating income margin, compared to $118.4 million, representing an 8.7% operating income margin, in 2007, and Adjusted EBITDA in 2008 was $248.1 million, compared to $221.4 million in 2007. Operating income and Adjusted EBITDA benefitted from lower selling, general and administrative expenses, an improvement in gross profit margin, and lower restructuring charges.
Additionally, operating income and Adjusted EBITDA in 2008 benefitted from a net gain of $4.7 million and $5.2 million, respectively, related to the sale of a facility in Mexico, and a net gain of $5.9 million related to the sale of a non-core trademark.
Net income in 2008 was $57.9 million, or $1.13 per diluted share, compared to a net loss of $16.1 million, or $0.32 per diluted share, in the prior year. Net income in 2008 includes a $45.2 million, or $0.88 per diluted share, gain on the sale of discontinued operations and a loss from discontinued operations of $0.4 million, or $0.01 per diluted share. Income from continuing operations in 2008 was $13.1 million and includes a net gain of $4.3 million related to the sale of a facility in Mexico and a net gain of $5.9 million related to the sale of a non-core trademark, and compares to a loss from continuing operations of $19.0 million in 2007.
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Net sales in 2008 were $1,346.8 million, a decrease of $20.3 million, or 1.5%, compared to $1,367.1 million in 2007. Foreign currency fluctuations negatively impacted net sales by $8.3 million. Excluding foreign currency fluctuations, net sales of Revlon brand color cosmetics increased 9% driven by strong new product introductions (higher shipments and favorable product returns, partially offset by higher promotional allowances). Increased net sales of Revlon brand color cosmetics were offset by declines in net sales for Almay (higher shipments, offset by higher product returns and higher promotional allowances), and lower net sales of certain fragrance and beauty care brands.
In the United States, net sales in 2008 were $782.6 million, a decrease of $21.6 million, or 2.7%, compared to $804.2 million in 2007. Higher net sales of Revlon brand color cosmetics were offset by lower net sales of Almay, fragrance and beauty care products. In 2008, higher net sales of Revlon ColorSilk and Revlon beauty tools were offset by cycling the 2007 launches of Revlon Colorist hair color, Revlon Flair fragrance and Mitchum Smart Solid anti-perspirant deodorant.
In the Company's international operations, net sales in 2008 were $564.2 million, an increase of $1.3 million, or 0.2%, compared to $562.9 million in 2007. Excluding the unfavorable impact of foreign currency fluctuations of $8.3 million, net sales increased by 1.7% as a result of higher net sales of Revlon and Almay color cosmetics, Revlon beauty tools and Mitchum anti-perspirant deodorant, partially offset by lower net sales of fragrance and hair care products. Higher net sales in the Asia Pacific and Latin America regions were partially offset by lower net sales in the Europe region.
Consistent with the Company's business plan and the increased level of new product introductions, the Company supported its brands with advertising and promotions throughout the year. In 2008, advertising and promotional spending across all the Company's brands remained largely unchanged.
The Company increased spending on its color cosmetics brands, while spending on certain of its beauty care brands was lower as a result of cycling prior year spending on the launches of Revlon Colorist hair color, Revlon Flair fragrance and Mitchum Smart Solid anti-perspirant deodorant. These actions contributed to our performance in the marketplace in 2008 as reflected in the U.S. mass retail dollar share and dollar volume growth related to the Revlon and Almay brands in the segments in which our new product launches and advertising and promotional spending were focused.
Operating income in 2008 was $155.0 million, representing an 11.5% operating income margin, compared to $118.4 million, representing an 8.7% operating income margin, in 2007, and Adjusted EBITDA in 2008 was $248.1 million, compared to $221.4 million in 2007. Operating income and Adjusted EBITDA benefitted from lower selling, general and administrative expenses, an improvement in gross profit margin, and lower restructuring charges.
Additionally, operating income and Adjusted EBITDA in 2008 benefitted from a net gain of $4.7 million and $5.2 million, respectively, related to the sale of a facility in Mexico, and a net gain of $5.9 million related to the sale of a non-core trademark.
Net income in 2008 was $57.9 million, or $1.13 per diluted share, compared to a net loss of $16.1 million, or $0.32 per diluted share, in the prior year. Net income in 2008 includes a $45.2 million, or $0.88 per diluted share, gain on the sale of discontinued operations and a loss from discontinued operations of $0.4 million, or $0.01 per diluted share. Income from continuing operations in 2008 was $13.1 million and includes a net gain of $4.3 million related to the sale of a facility in Mexico and a net gain of $5.9 million related to the sale of a non-core trademark, and compares to a loss from continuing operations of $19.0 million in 2007.
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Revlon Inc
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