|
|
| Revlon Reports Record Full Year and Fourth Quarter Results Record Earnings Per Share, Continuing Momentum |
NEW YORK, Jan. 22 /PRNewswire/ -- Revlon, Inc. (NYSE: REV) today announced
record performance for the full year and fourth quarter of 1997, marking
Revlon's 17th consecutive quarter of growth in net sales, operating income and
EBITDA compared with the corresponding quarter of the prior year.
"We are extremely proud to report record earnings per share for the year,"
said George Fellows, President and Chief Executive Officer. "By all
significant measures, including net sales and operating income, EBITDA and net
income before non-recurring charges, Revlon grew at double digit rates. The
Revlon brand solidified its #1 position with a 21.6% dollar market share and
widened its lead in dollar market share in the United States mass market color
cosmetics category. Our Almay and Revlon brands were the fastest growing
major brands at retail in dollar market share for the year according to A.C.
Nielsen. Our U.S. operation continued its strong growth based upon our
existing products and introduction of successful new product offerings. Our
International operation increased Revlon's global presence with the success
of Revlon branded color cosmetics, new launches and expanded distribution."
1997 PERFORMANCE
Net sales for 1997 increased 10.2% to $2.391 billion on a reported basis
or 12.6% on a constant U.S. dollar basis. Operating income rose 10.1% to
$220.9 million before a (non-recurring) charge of $7.6 million related to
business consolidation costs and other, net. EBITDA increased 12.3% to
$318.0 million before the (non-recurring) charge. Net income for 1997 was
$58.5 million, or $1.14 per share (based upon the weighted average common
shares outstanding for the period), before an extraordinary charge for early
extinguishment of debt of $14.9 million, or $.29 per share and after a gain of
$6.0 million which was recognized in 1997 as a result of the merger of
Revlon's Prestige Fragrance & Cosmetics subsidiary with The Cosmetic Center,
Inc. (Nasdaq: COSC). Net income for 1996 was $24.8 million, or $.50 per
share, before an extraordinary charge for early extinguishment of debt of
$6.6 million, or $.13 per share. Selling, general and administrative
expenses, other than advertising and consumer-directed promotion expense, as a
percentage of net sales improved to 39.3% from 40.9% in 1996. Advertising and
consumer-directed promotion increased 11.8% to $397.4 million or 16.6% of net
sales in 1997, from $355.5 million or 16.4% of sales in 1996.
FULL YEAR U.S. OPERATION
In the U.S., net sales grew by 15.3% to $1.453 billion for 1997, compared
with $1.260 billion last year. Excluding the impact of the Cosmetic Center
merger, net sales increased 10.1% for the year. Higher sales were driven by
successful new product introductions and the continued success of existing
product lines. New products launched in 1997 included ColorStay hair color,
which capitalizes on the ColorStay name and adds a new category to Revlon's
top-selling ColorStay cosmetics franchise, bringing proprietary long-wear
technology to the growing at-home hair color market; Top Speed Nail Enamel,
with a proprietary fast-drying formula, and Line and Shine, which uses
innovative technology combining a lip gloss and liner in one package. The
continued success of the ColorStay, Age Defying and New Complexion collections
and of seasonal fashion shade statements, featured in Revlon Reports, also
contributed to sales increases. In 1997 StreetWear, a line of cosmetics
targeted for the trend conscious consumer, was added to the Revlon portfolio.
The Almay brand generated excitement during 1997 with the continued success of
the Amazing and One Coat franchises.
FULL YEAR INTERNATIONAL OPERATION
The International operation's net sales increased to $938.4 million for
1997, compared to $909.8 million in 1996, an increase of 3.1% on a reported
basis. Net sales on a constant U.S. dollar basis and adjusted for the impact
of exiting the demonstrator-assisted distribution channel in Japan increased
10.1%. Net sales improved principally as a result of continued progress in
the Company's globalization strategy, particularly in Europe, Africa and the
Western Hemisphere. This increase was partially offset by less favorable
economic conditions in certain markets. However, the Company continued to
support the business in these markets as part of its long-term strategy.
Sales of seasonal fashion shade statements, featured in Revlon Reports, the
continued success of the ColorStay collection and the opening of new doors in
markets throughout the world all had a positive impact on International
business.
FOURTH QUARTER RESULTS
In the fourth quarter, net sales were $702.1 million, an increase of 14.2%
over the fourth quarter of 1996 on a reported basis or 17.0% on a constant
U.S. dollar basis. Operating income was $81.1 million, an increase of 5.7%,
after a (non-recurring) gain of $.8 million related to business consolidation.
EBITDA, after a (non-recurring) gain, grew to $106.0 million, up 7.0% compared
to last year's fourth quarter. Net income increased 32.3% for the quarter to
$41.4 million, or $.81 basic income per share compared to $31.3 million, or
$.61 basic income per share in the fourth quarter of 1996. Selling, general
and administrative expenses, other than advertising and consumer-directed
promotion expense, as a percentage of net sales improved to 36.1% from 36.9%
in 1996. Advertising and consumer-directed promotion increased 19.1% to
$121.5 million or 17.3% of net sales in the fourth quarter of 1997, from
$102.0 million or 16.6% of sales in the comparable 1996 period. In the U.S.,
net sales grew by 21.1% to $436.7 million for the fourth quarter, compared
with $360.5 million in the same period last year. Excluding the impact of the
merger of Revlon's Prestige Fragrance & Cosmetics subsidiary with Cosmetic
Center, net sales increased 12.8% for the period. The International
operation's net sales increased to $265.4 million for the fourth quarter,
compared to $254.2 million in the fourth quarter of 1996, an increase of 4.4%
on a reported basis. International net sales on a constant U.S. dollar basis
increased 11.1% primarily due to continued success in Europe, Africa and the
Western Hemisphere, including the acquisition of a hair care business in
Argentina.
1998 FOCUS
In 1998, Revlon plans to continue to drive innovation in the industry by
developing a wide range of revolutionary proprietary technology based products
designed to meet consumers' changing needs. MoistureStay, targeted for
launch in the spring, utilizes breakthrough technology to provide long-lasting
moisture for the lips. The Company also intends to launch Almay Stay Smooth
Anti-Chap lip color, which is the first anti-chap lip color with SPF 25.
Revlon also plans to expand successful brand franchises, including core
Revlon, ColorStay, Revlon Age Defying, and StreetWear, and will continue to
reinforce its color authority heritage through seasonal shade statements. The
Company plans to increase retail distribution in international markets and
further roll-out new products in key brand franchises internationally to
continue to support global objectives.
As previously reported, while consumer sell-through for the Revlon and
Almay brands was strong in 1997, the Company's sales to its retail customers
have been and may continue to be impacted by inventory balancing and
reductions resulting from consolidation in the chain drugstore industry.
Revlon is a worldwide leader in cosmetics, skin care, fragrance, personal
care and professional products. The Company's vision is to provide glamour,
excitement and innovation through quality products at affordable prices. A
web site featuring current product and promotional information can be reached
at http://www.revlon.com. Revlon's brands include Revlon(R), ColorStay(R), Age
Defying, StreetWear, Almay(R), Ultima II(R), Charlie(R) and Flex(R) and are
sold in approximately 175 countries and territories.
Forward Looking Statements
Information in this press release includes forward looking statements made
pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Such statements include, without limitation, the
Company's plans to continue as an industry innovator, its plans for the launch
of new products, expansion of successful brand franchises, and the increase in
retail distribution in international markets; and the possible impact
resulting from consolidation in the chain drugstore industry. In addition to
the factors that are described in the Company's SEC filings, including its
quarterly reports on Form 10-Q, the following factors could cause actual
results to differ materially from those expressed in the forward looking
statements: (i) difficulties or delays in developing and introducing new
proprietary, enhanced performance products and product franchise expansions or
failure of consumers to accept new product offerings and product franchise
expansions; (ii) difficulties or delays in the Company's continued expansion
outside the United States into the self-select distribution channel and into
new markets; (iii) greater than expected impact from consolidation in the
chain drugstore industry: and (iv) actions by competitors including business
combination, technological breakthroughs, new product offerings and marketing
and promotional success. The Company assumes no responsibility to update
forward looking information contained herein.
REVLON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(dollars in millions, except per share data)
Three Months Ended
December 31, Year Ended December 31,
1997 1996 1997 1996
Net sales $702.1 $614.7 $2,390.9 $2,169.5
Cost of sales 246.8 209.3 832.1 726.5
Gross profit 455.3 405.4 1,558.8 1,443.0
Selling, general and
administrative expenses 375.0 328.7 1,337.9 1,242.4
Business consolidation
costs and other, net (0.8) 0.00 7.6 0.00
Operating income 81.1 76.7 213.3 200.6
Other expenses (income):
Interest expense 35.5 33.4 136.2 133.4
Interest and net
investment income (0.8) (1.1) (3.0) (3.4)
Gain on sale of
subsidiary stock 0.00 0.00 (6.0) 0.00
Amortization of debt
issuance costs 1.4 1.8 6.7 8.3
Foreign currency
losses, net 1.2 0.00 6.4 5.7
Miscellaneous, net 2.2 4.5 5.1 6.3
Other expenses, net 39.5 38.6 145.4 150.3
Income before
income taxes 41.6 38.1 67.9 50.3
Provision for
income taxes 0.2 6.8 9.4 25.5
Income before
extraordinary items 41.4 31.3 58.5 24.8
Extraordinary items -
early extinguishment
of debt 0.00 0.00 (14.9) (6.6)
Net income $41.4 $31.3 $43.6 $18.2
Basic income per common share:
Income before
extraordinary items $0.81 $0.61 $1.14 $0.50
Extraordinary items 0.00 0.00 (0.29) (0.13)
Net income per
common share $0.81 $0.61 $0.85 $0.37
Diluted income per common share:
Income before
extraordinary items $0.80 $0.61 $1.14 $0.50
Extraordinary items 0.00 0.00 (0.29) (0.13)
Net income per
common share $0.80 $0.61 $0.85 $0.37
Weighted average common
shares outstanding
Basic 51,136,329 51,125,000 51,131,440 49,687,500
Dilutive 51,464,122 51,342,562 51,544,318 49,818,792
* The results of The Cosmetic Center, Inc. for the three months ended
December 31, 1997 and 1996 are as follows: Net sales of $62.1 and $28.4, cost
of sales of $40.3 and $13.2, S,G&A of $18.5 and $11.1 and operating income of
$3.3 and $4.1. The results of The Cosmetic Center, Inc. for 1997 and 1996 are
as follows: Net sales of $151.1 and $77.4, cost of sales of $93.9 and $37.6,
S,G&A of $59.5 and $38.4 and operating (loss) income of $(6.3) and $1.4, the
1997 period includes business consolidation costs of $4.0 in the operating
(loss).
REVLON, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(dollars in millions)
December 31, December 31,
1997 1996
ASSETS
Current assets:
Cash and cash equivalents $42.8 $38.6
Trade receivables, net 493.9 426.8
Inventories 349.3 281.1
Prepaid expenses and other 97.5 74.5
Total current assets 983.5 821.0
Property, plant and equipment, net 378.2 381.1
Intangible and other assets, net 472.9 419.8
Total assets $1,834.6 $1,621.9
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
Current liabilities:
Short-term borrowings - third parties $42.7 $27.1
Current portion of long-term debt
- third parties 5.5 8.8
Accounts payable, accrued expenses
and other 561.6 528.1
Total current liabilities 609.8 564.0
Long-term debt 1,458.7 1,352.2
Other long-term liabilities 224.6 202.8
Total stockholders' deficiency (458.5) (497.1)
Total liabilities and stockholders'
deficiency $1,834.6 $1,621.9
SOURCE Revlon, Inc.
back to topRelated links:
Press: Nancy Risdon, 212-527-5791, or
Investor Relations: Deena S. Fishman, 212-527-5230, both of
Revlon
CNOC: http://www.prnewswire.com or fax, 800-758-5804, ext.
110701
