REVLON INC (REV, Financial) filed Quarterly Report for the period ended 2009-06-30.
Revlon Inc. conducts its business exclusively through its subsidiary Revlon Consumer Products Corp. and its subsidiaries. They manufacture market and sell an extensive array of cosmetics and skin carefragrances and personal care products. Their brand names are REVLON COLORSTAY REVLON AGE DEFYING ALMAY and ULTIMA II in cosmetics; MOON DROPS ETERNA 27 ULTIMA II and JEANNE GATINEAU in skin care; CHARLIE and FIRE & ICE in fragrances; and FLEX OUTRAGEOUS MITCHUM COLORSTAY COLORSILK JEAN NATE PLUSBELLE BOZZANO and COLORAMA in personal care. REVLON INC has a market cap of $291.6 million; its shares were traded at around $5.66 with a P/E ratio of 11.6 and P/S ratio of 0.2.
In the United States, net sales in the second quarter of 2009 were $186.2 million, a decrease of $30.2 million, or 14.0%, compared to $216.4 million in the second quarter of 2008, primarily driven by retailer inventory reduction actions, which resulted in lower net sales of Revlon and Almay color cosmetics. In the first half of 2009, U.S. net sales were $377.2 million, a decrease of $16.4 million, or 4.2%, compared to $393.6 million in the first half of 2008, primarily driven by lower net sales of Revlon and Almay color cosmetics, Mitchum anti-perspirant deodorant and Revlon beauty tools.
In the Companys international operations, net sales in the second quarter of 2009 decreased by $14.5 million, or 9.7%, to $135.6 million, compared to $150.1 million in the second quarter of 2008 (while net sales increased 1.5% excluding the unfavorable impact of foreign currency fluctuations). The growth in net sales, excluding the impact of foreign currency fluctuations, was primarily due to higher net sales of Revlon color cosmetics and Revlon ColorSilk hair color, partially offset by declines in Revlon beauty tools. Excluding the impact of foreign currency fluctuations, higher net sales in the Companys Latin America and Asia Pacific regions in the second quarter of 2009, compared to the second quarter of 2008, were partially offset by lower net sales in the Companys Europe region. In the first half of 2009, international net sales decreased $36.7 million, or 12.9%, to $247.9 million, compared to $284.6 million in the first half of 2008 (while net sales increased 0.1% excluding the unfavorable impact of foreign currency fluctuations). The growth in net sales, excluding the impact of foreign currency fluctuations, was primarily due to higher net sales of Revlon color cosmetics and Revlon ColorSilk hair color, substantially offset by declines in certain beauty care products and fragrances. Excluding the impact of foreign currency fluctuations, higher net sales in the Companys Asia Pacific and Latin America regions in the first half of 2009, compared to the first half of 2008, were partially offset by lower net sales in the Companys Europe region.
9½% Senior Notes: In the first quarter of 2009, Products Corporation used $16.5 million to repurchase an aggregate principal amount of $23.9 million of its 91/2% Senior Notes due April 1, 2011 (the 91/2% Senior Notes), and paid an additional $1.2 million of accrued and unpaid interest and fees through the respective dates of the repurchases. In the second quarter of 2009, Products Corporation used $6.3 million to repurchase an aggregate principal amount of $7.0 million of its 91/2% Senior Notes and paid an additional $0.2 million of accrued and unpaid interest and fees through the respective dates of the repurchases. As a result of these 2009 repurchases, the Company recorded a gain of $7.0 million during the first quarter of 2009 and a gain of $0.5 million during the second quarter of 2009, which are net of the write-off of the ratable portion of unamortized debt discounts and deferred financing fees. After these repurchases, the repurchased notes were cancelled and there remained outstanding $359.1 million aggregate principal amount of the 91/2% Senior Notes, or $357.8 million net of discounts, at June 30, 2009.
The net impact of the re-measurements due to the cessation of future benefit accruals under the U.S. pension plans and the May 2009 Program is estimated to decrease the Companys pension expense (i.e., the net periodic benefit cost) for 2009 by approximately $2 million from its prior estimates (of which $1.1 million was reflected in the Companys financial statements in the second quarter of 2009, which includes a non-cash curtailment gain of $0.8 million related to the recognition of previously unrecognized prior service costs that had been reported in accumulated other comprehensive loss), such that the Companys pension expense is expected to be approximately $25 million to $30 million for all of 2009, rather than the prior estimate of $30 million to $35 million. In addition, the Companys pension benefit obligations for its U.S. pension plans decreased by $8.6 million from the level at December 31, 2008, as a result of the re-measurement of the pension liabilities resulting from the May 2009 Pension Plan Amendments, as well as the May 2009 Program. The May 2009 Plan Amendments are not expected to impact the Companys planned cash contributions to its U.S. pension plans or savings plans for 2009.
Consolidated net sales in the second quarter of 2009 were $321.8 million, a decrease of $44.7 million, or 12.2%, compared to $366.5 million in the second quarter of 2008. The primary drivers of the net sales decline were retailer inventory reduction actions and the unfavorable impact of foreign currency fluctuations. Consolidated net sales for the first half of 2009 were $625.1 million, a decrease of $53.1 million, or 7.8%, compared to $678.2 million for the first half of 2008. Excluding the unfavorable impact of foreign currency fluctuations of $16.7 million and $37.0 million, consolidated net sales decreased by 7.6% and 2.4%, in the second quarter of 2009 and first half of 2009, respectively. In the second quarter and first half of 2009, from a brand perspective, the decline in consolidated net sales was driven by lower net sales of Revlon and Almay color cosmetics and Revlon beauty tools, partially offset by higher net sales of Revlon ColorSilk hair color.
Read the The complete ReportREV is in the portfolios of Michael Price of MFP Investors LLC.
Revlon Inc. conducts its business exclusively through its subsidiary Revlon Consumer Products Corp. and its subsidiaries. They manufacture market and sell an extensive array of cosmetics and skin carefragrances and personal care products. Their brand names are REVLON COLORSTAY REVLON AGE DEFYING ALMAY and ULTIMA II in cosmetics; MOON DROPS ETERNA 27 ULTIMA II and JEANNE GATINEAU in skin care; CHARLIE and FIRE & ICE in fragrances; and FLEX OUTRAGEOUS MITCHUM COLORSTAY COLORSILK JEAN NATE PLUSBELLE BOZZANO and COLORAMA in personal care. REVLON INC has a market cap of $291.6 million; its shares were traded at around $5.66 with a P/E ratio of 11.6 and P/S ratio of 0.2.
Highlight of Business Operations:
Consolidated net sales in the second quarter of 2009 were $321.8 million, a decrease of $44.7 million, or 12.2%, compared to $366.5 million in the second quarter of 2008. Consolidated net sales for the first half of 2009 were $625.1 million, a decrease of $53.1 million, or 7.8%, compared to $678.2 million for the first half of 2008. Excluding the unfavorable impact of foreign currency fluctuations of $16.7 million and $37.0 million, consolidated net sales decreased by 7.6% and 2.4%, in the second quarter of 2009 and first half of 2009, respectively.In the United States, net sales in the second quarter of 2009 were $186.2 million, a decrease of $30.2 million, or 14.0%, compared to $216.4 million in the second quarter of 2008, primarily driven by retailer inventory reduction actions, which resulted in lower net sales of Revlon and Almay color cosmetics. In the first half of 2009, U.S. net sales were $377.2 million, a decrease of $16.4 million, or 4.2%, compared to $393.6 million in the first half of 2008, primarily driven by lower net sales of Revlon and Almay color cosmetics, Mitchum anti-perspirant deodorant and Revlon beauty tools.
In the Companys international operations, net sales in the second quarter of 2009 decreased by $14.5 million, or 9.7%, to $135.6 million, compared to $150.1 million in the second quarter of 2008 (while net sales increased 1.5% excluding the unfavorable impact of foreign currency fluctuations). The growth in net sales, excluding the impact of foreign currency fluctuations, was primarily due to higher net sales of Revlon color cosmetics and Revlon ColorSilk hair color, partially offset by declines in Revlon beauty tools. Excluding the impact of foreign currency fluctuations, higher net sales in the Companys Latin America and Asia Pacific regions in the second quarter of 2009, compared to the second quarter of 2008, were partially offset by lower net sales in the Companys Europe region. In the first half of 2009, international net sales decreased $36.7 million, or 12.9%, to $247.9 million, compared to $284.6 million in the first half of 2008 (while net sales increased 0.1% excluding the unfavorable impact of foreign currency fluctuations). The growth in net sales, excluding the impact of foreign currency fluctuations, was primarily due to higher net sales of Revlon color cosmetics and Revlon ColorSilk hair color, substantially offset by declines in certain beauty care products and fragrances. Excluding the impact of foreign currency fluctuations, higher net sales in the Companys Asia Pacific and Latin America regions in the first half of 2009, compared to the first half of 2008, were partially offset by lower net sales in the Companys Europe region.
9½% Senior Notes: In the first quarter of 2009, Products Corporation used $16.5 million to repurchase an aggregate principal amount of $23.9 million of its 91/2% Senior Notes due April 1, 2011 (the 91/2% Senior Notes), and paid an additional $1.2 million of accrued and unpaid interest and fees through the respective dates of the repurchases. In the second quarter of 2009, Products Corporation used $6.3 million to repurchase an aggregate principal amount of $7.0 million of its 91/2% Senior Notes and paid an additional $0.2 million of accrued and unpaid interest and fees through the respective dates of the repurchases. As a result of these 2009 repurchases, the Company recorded a gain of $7.0 million during the first quarter of 2009 and a gain of $0.5 million during the second quarter of 2009, which are net of the write-off of the ratable portion of unamortized debt discounts and deferred financing fees. After these repurchases, the repurchased notes were cancelled and there remained outstanding $359.1 million aggregate principal amount of the 91/2% Senior Notes, or $357.8 million net of discounts, at June 30, 2009.
The net impact of the re-measurements due to the cessation of future benefit accruals under the U.S. pension plans and the May 2009 Program is estimated to decrease the Companys pension expense (i.e., the net periodic benefit cost) for 2009 by approximately $2 million from its prior estimates (of which $1.1 million was reflected in the Companys financial statements in the second quarter of 2009, which includes a non-cash curtailment gain of $0.8 million related to the recognition of previously unrecognized prior service costs that had been reported in accumulated other comprehensive loss), such that the Companys pension expense is expected to be approximately $25 million to $30 million for all of 2009, rather than the prior estimate of $30 million to $35 million. In addition, the Companys pension benefit obligations for its U.S. pension plans decreased by $8.6 million from the level at December 31, 2008, as a result of the re-measurement of the pension liabilities resulting from the May 2009 Pension Plan Amendments, as well as the May 2009 Program. The May 2009 Plan Amendments are not expected to impact the Companys planned cash contributions to its U.S. pension plans or savings plans for 2009.
Consolidated net sales in the second quarter of 2009 were $321.8 million, a decrease of $44.7 million, or 12.2%, compared to $366.5 million in the second quarter of 2008. The primary drivers of the net sales decline were retailer inventory reduction actions and the unfavorable impact of foreign currency fluctuations. Consolidated net sales for the first half of 2009 were $625.1 million, a decrease of $53.1 million, or 7.8%, compared to $678.2 million for the first half of 2008. Excluding the unfavorable impact of foreign currency fluctuations of $16.7 million and $37.0 million, consolidated net sales decreased by 7.6% and 2.4%, in the second quarter of 2009 and first half of 2009, respectively. In the second quarter and first half of 2009, from a brand perspective, the decline in consolidated net sales was driven by lower net sales of Revlon and Almay color cosmetics and Revlon beauty tools, partially offset by higher net sales of Revlon ColorSilk hair color.
Read the The complete ReportREV is in the portfolios of Michael Price of MFP Investors LLC.
