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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: November 6, 2007
(Date of earliest event reported): (November 6, 2007)
Revlon, Inc.
------------
(Exact Name of Registrant as Specified in its Charter)
Delaware 1-11178 13-3662955
- --------------------------------------------------------------------------------
(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
237 Park Avenue
New York, New York 10017
- --------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
(212) 527-4000
---------------
(Registrant's telephone number, including area code)
None
----
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 2.02. Results of Operations and Financial Condition.
On November 6, 2007, Revlon, Inc. issued a press release announcing its earnings
for the third quarter of 2007. A copy of the press release is attached hereto as
Exhibit 99.1 and is incorporated by reference herein. In accordance with General
Instruction B.2 to the Form 8-K, the information under this Item 2.02 and the
press release attached hereto as Exhibit 99.1 shall be deemed to be "furnished"
to the SEC and not be deemed to be "filed" with the SEC for purposes of Section
18 of the Exchange Act or otherwise subject to the liabilities of that section.
Item 9.01. Financial Statements and Exhibits.
(c) Exhibits
Exhibit No. Description
----------- -----------
99.1 Press release dated November 6, 2007.
2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
REVLON, INC.
By: /s/ Robert K. Kretzman
----------------------
Robert K. Kretzman
Executive Vice President,
Human Resources, Chief Legal Officer,
General Counsel and Secretary
Date: November 6, 2007
3
EXHIBIT INDEX
Exhibit No. Description
----------- -----------
99.1 Press release dated November 6, 2007.
4
Exhibit 99.1
Revlon Reports Third Quarter 2007 Results
Increases in Net Sales and Continued Benefits from Restructuring
Actions Positively Impact Third Quarter Results
Full Year Adjusted EBITDA Expected to Exceed $210 Million
Strong 2008 New Product Lineup
NEW YORK--(BUSINESS WIRE)--Nov. 6, 2007--Revlon, Inc. (NYSE: REV)
today announced results for the third quarter and nine months ended
September 30, 2007.
Third quarter 2007 financial highlights compared to the same
period last year:
-- Net sales increased to $339.7 million from $305.9 million.
-- Operating income increased to $20.7 million, compared to an
operating loss of $57.2 million.
-- Net loss was $10.4 million, or $0.02 per diluted share,
compared to a net loss of $100.5 million, or $0.24 per diluted
share.
-- Adjusted EBITDA(1) increased to $43.9 million, compared to an
Adjusted EBITDA loss of $25.1 million.
-- Vital Radiance, executive severance and restructuring expenses
affected comparability of the 2007 over 2006 period. In the
third quarter 2006, these items collectively reduced net sales
by approximately $15 million, reduced operating profitability
by approximately $72 million and reduced Adjusted EBITDA by
approximately $64 million. The third quarter of 2007 included
restructuring expenses of $0.5 million.
Commenting on today's announcement, Revlon President and Chief
Executive Officer, David Kennedy, said, "Our performance in the third
quarter was driven by a combination of increased net sales, continued
benefits from the restructuring actions we took in 2006 and early in
2007 and ongoing control of our costs. Based on our performance in the
third quarter and our outlook for the remainder of the year, full year
adjusted EBITDA is expected to exceed our previous forecast of $210
million."
Third Quarter Results
Net sales in the third quarter of 2007 increased 11.0% to $339.7
million, compared to net sales of $305.9 million in the third quarter
of 2006. Excluding the impact of foreign currency fluctuations, net
sales in the third quarter increased 8.6% versus year-ago. Third
quarter 2006 net sales were reduced by approximately $15 million from
Vital Radiance.
In the United States, net sales in the third quarter of 2007
increased 19.7% to $190.9 million, compared with net sales of $159.5
million in the third quarter of 2006. Third quarter 2006 net sales
were reduced by approximately $15 million from Vital Radiance.
Excluding the impact of Vital Radiance, the increase in net sales was
driven by an improvement in sales returns (primarily due to higher
accrued returns in the third quarter 2006 related to a national
promotional program) and higher shipments in beauty care products
(primarily from women's hair color), partially offset by lower
shipments of Revlon and Almay color cosmetics.
In the Company's international operations, net sales in the third
quarter of 2007 increased 1.6% to $148.8 million, compared to net
sales of $146.4 million in the third quarter of 2006. Excluding the
impact of foreign currency fluctuations, net sales in the third
quarter of 2007 declined 3.4% compared to the same period last year.
These results reflected lower net sales in the Europe region,
particularly in Canada, partially offset by increases in net sales in
the Asia Pacific region. Net sales in the Latin America region were
unchanged compared to the same period last year. Third quarter 2006
net sales in Canada were positively impacted by the restage of Almay
color cosmetics. In the third quarter of 2007, international operating
profits and margins continued to improve compared to the same period
last year.
Operating income was $20.7 million in the third quarter of 2007,
versus an operating loss of $57.2 million in the third quarter of
2006. Net loss in the third quarter of 2007 was $10.4 million, or
$0.02 per diluted share, compared with a net loss of $100.5 million,
or $0.24 per diluted share, in the third quarter of 2006. Adjusted
EBITDA in the third quarter of 2007 was $43.9 million, compared to an
Adjusted EBITDA loss of $25.1 million in the same period last year. In
the third quarter 2006, Vital Radiance, executive severance and
restructuring expenses reduced the Company's operating profitability
by $72 million and Adjusted EBITDA by approximately $64 million. The
third quarter of 2007 included restructuring expenses of $0.5 million.
Excluding the impact of these items, the improvements in operating
income, net loss and Adjusted EBITDA were driven by net sales
increases, continued benefits from restructuring actions and ongoing
cost controls.
Adjusted EBITDA is a non-GAAP measure that is defined in the
footnotes to this release and is reconciled to net income/(loss), the
most directly comparable GAAP measure, in the accompanying financial
tables.
Nine Months Results
Net sales in the first nine months of 2007 advanced 6.8% to
$1,017.5 million, compared to net sales of $952.5 million in the first
nine months of 2006. Excluding the impact of foreign currency
fluctuations, net sales in the first nine months increased 5.5% versus
year-ago. Net sales in the first nine months of 2006 were reduced by
approximately $15 million from Vital Radiance.
In the United States, net sales in the first nine months of 2007
increased 9.4% to $588.4 million compared with net sales of $537.8
million in the first nine months of 2006. Net sales in the United
States in the first nine months of 2006 were reduced by approximately
$15 million from Vital Radiance. Excluding the impact of Vital
Radiance, the increase in net sales was driven by higher shipments in
beauty care products (primarily women's hair color) and Almay color
cosmetics and an improvement in sales returns (primarily due to higher
accrued returns in the third quarter 2006 related to a national
promotional program), partially offset by lower shipments of Revlon
color cosmetics.
In the Company's international operations, net sales in the first
nine months of 2007 increased 3.5% to $429.1 million, compared with
net sales of $414.7 million in the first nine months of 2006.
Excluding the impact of foreign currency fluctuations, international
net sales in the first nine months of 2007 advanced 0.5% versus
year-ago. These results reflected net sales increases in the Asia
Pacific and Latin America regions, offset by lower net sales in the
Europe region, particularly in Canada. Net sales in the first nine
months of 2006 in Canada were positively impacted by the restage of
Almay and certain promotional programs in color cosmetics. In the
first nine months of 2007, international operating profits and margins
continued to improve compared to the same period last year.
Operating income was $40.6 million in the first nine months of
2007, versus an operating loss of $120.3 million in the first nine
months of 2006. Net loss in the first nine months of 2007 was $56.9
million, or $0.11 per diluted share, compared with a net loss of
$245.8 million, or $0.59 per diluted share in the first nine months of
2006. Adjusted EBITDA in the first nine months of 2007 was $118.2
million, compared to an Adjusted EBITDA loss of $30.0 million in the
same period last year. In the first nine months of 2006, Vital
Radiance, executive severance and restructuring expenses reduced the
Company's operating profitability by $124 million and Adjusted EBITDA
by approximately $113 million. Results for the first nine months of
2007 included restructuring expenses of $6.9 million. Excluding the
impact of these items, the improvements in operating income, net loss
and Adjusted EBITDA were driven by net sales increases, continued
benefits from restructuring actions and ongoing cost controls.
Cash flow used for operating activities in the first nine months
of 2007 was $47.6 million, compared with cash flow used for operating
activities of $124.8 million in the first nine months of 2006. This
improvement was primarily due to a lower net loss and decreased
permanent display spending, partially offset by changes in net working
capital.
U.S. Market Share Results(2)
In terms of U.S. market share performance, according to ACNielsen,
the color cosmetics category increased 0.7% in the third quarter 2007
compared to the same period last year. U.S. mass-market share for the
Revlon, Almay and Vital Radiance (which was discontinued in September
2006) color cosmetics brands, and for women's hair color,
anti-perspirants and deodorants, and beauty tools for the third
quarter of 2007 are summarized in the table below:
$Share %
------------------------
Point
Q3 2007 Q3 2006 Change
------- ------- --------
Total Company Color Cosmetics 19.0 22.1 -3.1
Revlon Brand 13.1 14.5 -1.4
Almay Brand 5.8 6.2 -0.4
Vital Radiance Brand 0.0 1.3 -1.3
Total Company Women's Hair Color 11.8 9.4 2.4
Total Company Anti-perspirants / deodorants 5.7 6.1 -0.4
Revlon Beauty Tools 23.9 26.4 -2.5
Commenting on the Company's market share results, Mr. Kennedy
said, "In the third quarter 2007, Revlon color cosmetics market share
declined year-over-year, which reflected a decrease in market share by
products launched in prior years, offset, in part, by positive
performance from new products launched in the second half of 2006 and
in 2007. On a sequential basis, since the fourth quarter 2006, the
Revlon brand has maintained an approximate 13% dollar share."
Mr. Kennedy continued, "In the third quarter 2007, Revlon's
positive performance in the eye category was more than offset by
declines in the face, lip and nail categories. Revlon's positive
performance in the eye category was driven by the Limited Edition Eye
Collection, Luxurious Color Eyeliner and 3D Extreme Mascara, which
were all launched in 2007. In the third quarter 2007, Almay's positive
performance in the face category was offset by declines in the lip and
eye categories. Almay's positive performance in the face category was
driven by the recently launched Smart Shade Makeup, and by its new
line extensions, Smart Shade Blush and Bronzer. In the third quarter
and first nine months of 2007, we continued to competitively support
our existing brands worldwide with increased dollar spending versus
last year."
2008 New Product Lineup
Revlon is focused on building and leveraging its strong brands and
believes that consistent development and marketing of innovative new
products is a key driver for building brand equity and profitable
growth. For 2008, the Company will introduce an extensive new product
lineup of Revlon and Almay color cosmetics. These product launches
include differentiated and unique offerings for the mass channel,
innovations in products and packaging, new technologies, exciting
styles and extensions within the Revlon and Almay power franchises.
The Company intends to continue its strategy of supporting new
products with advertising and promotions, at competitive levels, using
its talented spokesmodels.
First half 2008 Revlon color cosmetics introductions:
-- ColorStay Minerals - the first-ever longwearing minerals
collection in the mass-market. The ColorStay Minerals
collection includes foundation as well as baked blush, bronzer
and eye shadow. These products contain a unique
skin-nourishing mineral complex that is combined with Revlon's
patented and longstanding ColorStay longwear technology.
-- Custom Creations Foundation - a first-to-market foundation
packaged in an innovative bottle that delivers five different
custom shades at the turn of a dial.
-- Limited Edition Collection - exciting new cross-category
introductions in face, eye and lip. Revlon continues to set
the trends in color cosmetics with its 2008 Limited Edition
Collection that focuses on self-expression and freedom of
experimentation.
First half 2008 Almay color cosmetics introductions:
-- TLC (Truly Lasting Color) Foundation - the first mass-market
healthy beauty longwear makeup that incorporates skincare
benefits.
-- Intense i-Color Play Up Collection - a relaunch of the highly
successful Intense i-Color Collection with new Play Up
shadows, liners and mascara with a molded brush. These
products are expertly coordinated to intensify natural eye
color.
-- Almay Makeup Remover - an enhanced formula and an improved
package for the already successful makeup remover. The product
contains a botanical blend of ingredients to condition skin.
In the second half of 2008, the Company will offer additional and
significant new products and innovations within the Revlon and Almay
portfolios.
Company Strategy
In conclusion, Mr. Kennedy said, "We continue to execute our
business strategy.
(1) Building and leveraging our strong brands - throughout 2007 we
launched several exciting new products in our core brands and are
supporting these launches at competitive levels. As noted, we
believe we have an exciting and strong 2008 new product lineup;
(2) Improving the execution of our strategies and plans, and providing
for continued improvement in our organizational capability
through enabling and developing our employees - effective October
1, 2007, we established a U.S. region and appointed Chris Elshaw
as General Manager to run this significant part of our business.
This organizational change is providing the focus and continued
clear accountability to grow the U.S. business profitably. Prior
to his new role, Chris successfully grew our business in Europe
and Canada for the past five years as Managing Director of our
Europe region;
(3) Continuing to strengthen our international business - we continue
to strengthen our international business by leveraging our U.S.-
based Revlon brand marketing, as well as our strong regional
brands. In third quarter and first nine months of 2007,
international operating profits and margins continued to improve
compared to the same periods last year;
(4) Improving our operating profit margins and cash flow - we are
focusing on sales growth and expect continuing, sustainable
benefits from our restructuring actions and ongoing cost
controls; and
(5) Improving our capital structure - In September 2007, we entered
into a $150 million two-year floating-to-fixed interest rate swap
transaction related to indebtedness under our term loan in order
to reduce our exposure to interest rate volatility. We plan to
refinance the remaining balance of our 8 5/8% senior subordinated
notes in the fourth quarter of 2007."
Conference Call
The Company will host a conference call with members of the
investment community on November 6, 2007 at 9:30 AM EST to discuss the
results of the third quarter. Access to the call is available to the
public at www.revloninc.com.
About Revlon
Revlon is a worldwide cosmetics, skincare, fragrances, beauty
tools, hair color, anti-perspirants/deodorants and personal care
products company. The Company's vision is to deliver the promise of
beauty through creating and developing the most consumer preferred
brands. Websites featuring current product and promotional information
can be reached at www.revlon.com, www.almay.com and
www.mitchumman.com. Corporate and investor relations information can
be accessed at www.revloninc.com. The Company's brands, which are sold
worldwide, include Revlon(R), Almay(R), Ultima(R), Charlie(R), Flex(R)
and Mitchum(R).
Footnotes to Press Release
(1)Adjusted EBITDA is a non-GAAP financial measure that is
reconciled to net income/(loss), its most directly comparable GAAP
measure, in the accompanying financial tables. Adjusted EBITDA is
defined as net earnings before interest, taxes, depreciation,
amortization, gains/losses on foreign currency transactions,
gains/losses on the sale of assets, gains/losses on the early
extinguishment of debt and miscellaneous expenses. In calculating
Adjusted EBITDA, the Company excludes the effects of gains/losses on
foreign currency transactions, gains/losses on the sale of assets,
gains/losses on the early extinguishment of debt and miscellaneous
expenses because the Company's management believes that some of these
items may not occur in certain periods, the amounts recognized can
vary significantly from period to period and these items do not
facilitate an understanding of the Company's operating performance.
The Company's management utilizes Adjusted EBITDA as an operating
performance measure in conjunction with GAAP measures, such as net
income and gross margin calculated in accordance with GAAP.
The Company's management uses Adjusted EBITDA as an integral part
of its reporting and planning processes and as one of the primary
measures to, among other things --
(i) monitor and evaluate the performance of the Company's business
operations;
(ii) facilitate management's internal comparisons of the Company's
historical operating performance of its business operations;
(iii) facilitate management's external comparisons of the results of
its overall business to the historical operating performance of
other companies that may have different capital structures and
debt levels;
(iv) review and assess the operating performance of the Company's
management team and as a measure in evaluating employee
compensation and bonuses;
(v) analyze and evaluate financial and strategic planning decisions
regarding future operating investments; and
(vi) plan for and prepare future annual operating budgets and
determine appropriate levels of operating investments.
The Company's management believes that Adjusted EBITDA is useful
to investors to provide them with disclosures of the Company's
operating results on the same basis as that used by the Company's
management. Additionally, the Company's management believes that
Adjusted EBITDA provides useful information to investors about the
performance of the Company's overall business because such measure
eliminates the effects of unusual or other infrequent charges that are
not directly attributable to the Company's underlying operating
performance. Additionally, the Company's management believes that
because it has historically provided Adjusted EBITDA in previous press
releases, that including such non-GAAP measure in its earnings
releases provides consistency in its financial reporting and
continuity to investors for comparability purposes. Accordingly, the
Company believes that the presentation of Adjusted EBITDA, when used
in conjunction with GAAP financial measures, is a useful financial
analysis tool, used by the Company's management as described above
that can assist investors in assessing the Company's financial
condition, operating performance and underlying strength. Adjusted
EBITDA should not be considered in isolation or as a substitute for
net income/(loss) prepared in accordance with GAAP. Other companies
may define EBITDA differently. Also, while EBITDA is defined
differently than Adjusted EBITDA for the Company's credit agreement,
certain financial covenants in its borrowing arrangements are tied to
similar measures. Adjusted EBITDA, as well as the other information in
this press release, should be read in conjunction with the Company's
financial statements and footnotes contained in the documents that the
Company files with the U.S. Securities and Exchange Commission.
(2)All market share and consumption data is U.S. mass-market
dollar volume according to ACNielsen (an independent research entity).
ACNielsen data is an aggregate of the drug channel, Kmart, Target and
Food and Combo stores, and excludes Wal-Mart and regional mass volume
retailers, as well as prestige, department stores, door-to-door,
internet, television shopping, specialty stores, perfumeries and other
outlets, all of which are channels for cosmetics sales. This data
represents approximately two-thirds of the Company's U.S. mass-market
dollar volume. Such data represent ACNielsen's estimates based upon
data gathered by ACNielsen from market samples and are therefore
subject to some degree of variance and may contain slight rounding
differences.
Forward-Looking Statements
Statements made in this press release, which are not historical
facts, including statements about the Company's plans, strategies,
beliefs and expectations, are forward-looking and subject to the safe
harbor provisions of the Private Securities Litigation Reform Act of
1995. Forward-looking statements speak only as of the date they are
made and, except for the Company's ongoing obligations under the U.S.
federal securities laws, the Company undertakes no obligation to
publicly update any forward-looking statement, whether to reflect
actual results of operations; changes in financial condition; changes
in general economic, industry or cosmetics category conditions;
changes in estimates, expectations or assumptions; or other
circumstances or events arising after the issuance of this press
release. Such forward-looking statements include, without limitation,
the Company's beliefs, expectations and/or plans: (i) concerning our
future growth, profitability, cash flow and financial performance,
including that our 2007 full year Adjusted EBITDA is expected to
exceed our previous forecast of $210 million; (ii) concerning the
launch of new products, including that consistent development and
marketing of innovative new products is a key driver for building
brand equity and profitable growth, that for 2008 we will introduce an
extensive new product lineup for Revlon and Almay color cosmetics,
including differentiated and unique offerings for the mass channel,
innovations in products and packaging, new technologies, exciting
styles and extensions within the Revlon and Almay power franchises and
our intentions to continue our strategy of supporting new products
with advertising and promotions, at competitive levels, using our
talented spokesmodels and that in the second half of 2008, we will
offer additional and significant new products and innovations within
the Revlon and Almay portfolios; and (iii) to continue to execute our
business strategy, including by (a) building and leveraging our strong
brands, including having an exciting and strong 2008 new product
lineup; (b) improving the execution of our strategies and plans and
providing for continued improvement in our organizational capability
through enabling and developing our employees, including that our U.S.
region organizational change will provide focus and continue the clear
accountability to grow our U.S. business profitably; (c) continuing to
strengthen our international business, including by leveraging our
U.S.-based Revlon brand marketing, as well as our strong regional
brands; (d) improving our operating profit margins and cash flow,
including our focusing on sales growth and continuing, sustainable
benefits from our restructuring actions and ongoing cost controls; and
(e) improving our capital structure, including our expectation that
the interest rate swap transaction will reduce our exposure to
interest rate volatility and our plans to refinance the remaining
balance of our upcoming 8 5/8% senior subordinated notes in the fourth
quarter of 2007.
Actual results may differ materially from such forward-looking
statements for a number of reasons, including those set forth in our
filings with the SEC, including our 2006 Annual Report on Form 10-K
and our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K
that we file with the SEC during 2007 (which may be viewed on the
SEC's website at http://www.sec.gov or on our website at
http://www.revloninc.com), as well as reasons including difficulties,
delays, unanticipated costs or our inability: (i) to achieve our
future growth, profitability, cash flow and financial performance
objectives, including less than anticipated growth, or a decrease, in
Adjusted EBITDA, including, without limitation, 2007 Adjusted EBITDA
not exceeding, or being less than, $210 million, such as due to lower
than anticipated revenues, less than anticipated shipments, more than
anticipated returns and/or higher than expected expenses, as well as
actions by our retail customers impacting our financial performance,
including in response to decreased consumer spending in response to
weak economic conditions or weakness in the category or retailer
inventory management, changes in consumer preferences, such as reduced
consumer demand for our products, changes in consumer purchasing
habits, including with respect to shopping channels, changes in the
competitive environment and actions by our competitors, including
business combinations, technological breakthroughs, new products
offerings, promotional spending and/or marketing and promotional
successes; (ii) develop and launch new products as a key driver for
building brand equity and growth, such as due to less than effective
new product development or less than expected acceptance of our new
products by consumers and/or retail customers and/or less than
expected levels of support for our new product launches; and/or (iii)
to continue to execute on our business strategy, such as (a) less than
expected growth of our strong brands, such as due to less than
expected acceptance of our new or existing products under these brands
by consumers and/or retail customers; (b) difficulties, delays or the
inability to improve the execution of our strategies and plans and/or
organizational capability through enabling and developing our
employees, including less than expected benefits from our U.S. region
organizational changes, such as the inability to grow our U.S.
business, or less than expected growth; (c) our inability to continue
to strengthen our international business, such as due to higher than
anticipated levels of investment required to support and build our
brands globally or less than anticipated results from our regional
and/or multi-national brands; (d) our inability to improve our
operating profit margins and cash flow, such as due to less than
anticipated sales growth and/or less than anticipated savings from our
restructuring actions and/or ongoing cost controls; and/or (e)
difficulties, delays, unanticipated costs or our inability to improve
our capital structure, including in connection with refinancing the
remaining balance of our 8 5/8% Senior Subordinated Notes, in whole or
in part, in the fourth quarter of 2007 or less than anticipated
benefits from our interest rate swap transaction. Factors other than
those listed above could also cause the Company's results to differ
materially from expected results. Additionally, the business and
financial materials and any other statement or disclosure on, or made
available through, the Company's websites or other websites referenced
herein shall not be incorporated by reference into this release.
REVLON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(dollars in millions, except per share data)
Three Months Ended
September 30,
--------------------------
2007 2006
------------ ------------
(Unaudited)
Net sales $ 339.7 305.9
Cost of sales 124.3 148.9
------------ ------------
Gross profit 215.4 157.0
Selling, general and administrative
expenses 194.2 200.4
Restructuring costs and other, net 0.5 13.8
------------ ------------
Operating income (loss) 20.7 (57.2)
------------ ------------
Other expenses (income):
Interest expense 34.5 38.3
Interest income (0.2) (0.2)
Amortization of debt issuance costs 1.0 2.0
Foreign currency losses (gains), net (3.9) (0.2)
Loss on early extinguishment of debt - -
Miscellaneous, net (1.3) 0.1
------------ ------------
Other expenses, net 30.1 40.0
------------ ------------
Loss before income taxes (9.4) (97.2)
Provision for income taxes 1.0 3.3
------------ ------------
Net loss $ (10.4) $ (100.5)
============ ============
Basic and diluted net loss per common
share $ (0.02) $ (0.24)
============ ============
Weighted average number of common shares
outstanding:
Basic and diluted 510,488,380 425,405,089
============ ============
Nine Months Ended
September 30,
--------------------------
2007 2006
------------ ------------
Net sales $ 1,017.5 952.5
Cost of sales 378.3 404.2
------------ ------------
Gross profit 639.2 548.3
Selling, general and administrative
expenses 591.7 645.3
Restructuring costs and other, net 6.9 23.3
------------ ------------
Operating income (loss) 40.6 (120.3)
------------ ------------
Other expenses (income):
Interest expense 101.9 109.4
Interest income (1.7) (1.0)
Amortization of debt issuance costs 2.3 5.6
Foreign currency losses (gains), net (4.4) (1.4)
Loss on early extinguishment of debt 0.1 0.4
Miscellaneous, net (2.3) 0.5
------------ ------------
Other expenses, net 95.9 113.5
------------ ------------
Loss before income taxes (55.3) (233.8)
Provision for income taxes 1.6 12.0
------------ ------------
------------ ------------
Net loss $ (56.9) $ (245.8)
============ ============
Basic and diluted net loss per common
share $ (0.11) $ (0.59)
============ ============
Weighted average number of common shares
outstanding:
Basic and diluted 502,191,060 413,670,178
============ ============
REVLON, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(dollars in millions)
September December
30, 31,
ASSETS 2007 2006
----------- ---------
(Unaudited)
Current assets:
Cash and cash equivalents $ 29.9 $ 35.4
Trade receivables, net 178.6 207.8
Inventories 194.1 186.5
Prepaid expenses and other 54.0 58.3
----------- ---------
Total current assets 456.6 488.0
Property, plant and equipment, net 111.4 115.3
Other assets 128.2 142.4
Goodwill, net 186.2 186.2
----------- ---------
Total assets $ 882.4 $ 931.9
=========== =========
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
Current liabilities:
Short-term borrowings $ 3.1 $ 9.6
Current portion of long-term debt 171.8 -
Accounts payable 101.2 95.1
Accrued expenses and other 248.8 272.5
----------- ---------
Total current liabilities 524.9 377.2
Long-term debt 1,290.5 1,501.8
Long-term pension and other post-retirement
plan liabilities 140.2 175.7
Other long-term liabilities 75.9 107.0
Total stockholders' deficiency (1,149.1) (1,229.8)
----------- ---------
Total liabilities and stockholders'
deficiency $ 882.4 $ 931.9
=========== =========
REVLON, INC. AND SUBSIDIARIES
UNAUDITED ADJUSTED EBITDA RECONCILIATION
(dollars in millions)
Three Months
Ended
September 30,
---------------
2007 2006
------ -------
(Unaudited)
Reconciliation to net loss:
- ----------------------------------------------------
Net loss $(10.4) $(100.5)
Interest expense, net 34.3 38.1
Amortization of debt issuance costs 1.0 2.0
Foreign currency losses (gains), net (3.9) (0.2)
Loss on early extinguishment of debt - -
Miscellaneous, net (1.3) 0.1
Provision for income taxes 1.0 3.3
Depreciation and amortization 23.2 32.1
------ -------
Adjusted EBITDA $ 43.9 $ (25.1)
====== =======
Nine Months
Ended
September 30,
---------------
2007 2006
------ -------
(Unaudited)
Reconciliation to net loss:
- ----------------------------------------------------
Net loss $(56.9) $(245.8)
Interest expense, net 100.2 108.4
Amortization of debt issuance costs 2.3 5.6
Foreign currency losses (gains), net (4.4) (1.4)
Loss on early extinguishment of debt 0.1 0.4
Miscellaneous, net (2.3) 0.5
Provision for income taxes 1.6 12.0
Depreciation and amortization 77.6 90.3
------ -------
Adjusted EBITDA $118.2 $ (30.0)
====== =======
CONTACT: Investor Relations & Media:
Revlon, Inc.
Abbe F. Goldstein, CFA, 212-527-6465