Revlon Reports Third Quarter Results; Credit Agreement Amended

Search Blogs that Mention this News Release
Click this link to view linked Bookmarking Services
Click this link to view linked Blogging Services
Revlon Reports Third Quarter Results; Credit Agreement Amended
    NEW YORK, Nov. 15 /PRNewswire/ -- Revlon, Inc. (NYSE: REV) today announced
its results for the third quarter of 1999, which were in line with previously
announced expectations.  The Company also announced that its Credit Agreement
was successfully amended on satisfactory terms.  In addition, the Company
noted that it is proceeding with its negotiations and active discussions with
prospective purchasers of its worldwide Professional Products business and its
non-core Latin American brands, conducted under the Colorama, Juvena, Bozzano,
and Plusbelle names.  Subject to reaching agreement on terms and
documentation, Revlon anticipates consummating these sales during the first
quarter of next year for gross proceeds in excess of $500 million.
    On November 2, Revlon announced the election of Jeffrey M. Nugent as
President and Chief Executive Officer of Revlon.  Mr. Nugent, who will join
the Company on December 5, 1999, was formerly Worldwide President of
Neutrogena Corporation Inc.
    Operating loss in the third quarter of 1999 was $121.1 million, before
restructuring charges of $4.4 million, as compared with operating income of
$39.9 million, before non-recurring gains of $7.1 million, for the third
quarter of 1998.  EBITDA was $(91.8) million before restructuring charges in
the third quarter of 1999, as compared with $64.5 million before non-recurring
gains in the third quarter of 1998.
    Net sales in the third quarter were $452.4 million, a decrease of 17.5%,
on a reported basis, or a decrease of 15.4% on a constant U.S. dollar basis,
as compared with the third quarter of 1998.  In the 1999 third quarter, loss
from continuing operations before restructuring charges was $160.3 million, or
$3.12 per diluted share, as compared with income from continuing operations
before non-recurring gains of $5.6 million, or $.11 per diluted share, in the
third quarter of 1998.
    Revlon expects a 1999 full year operating loss before restructuring
charges in excess of the range that the Company estimated in its October 1
news release.  With the arrival on December 5 of Revlon's newly named
President and Chief Executive Officer, Jeffrey M. Nugent, the Company
anticipates working with its trade partners to complete its program for
achieving targeted inventory levels.  In the first quarter of 2000, the
Company expects to cooperate with retailers to increase the efficient
introduction of new products into the marketplace.

    QUARTERLY PERFORMANCE
    In the U.S., net sales were $250.0 million for the third quarter, as
compared with $334.3 million in the same period last year, a decrease of
25.2%.  This reflects Revlon's October 1 announcement in which it said that it
would be working with its customers to accelerate the reduction of U.S.
retailers' warehouse inventory levels.
    According to A.C. Nielsen, the Revlon brand maintained its position as the
leading mass cosmetics brand in the U.S. in the third quarter of 1999,
climbing to a 20.5% dollar share, a level equal to the third quarter of last
year, and higher than the brand's 19.6% share for the second quarter of 1999.
    International net sales were $202.4 million for the third quarter, as
compared with $214.3 million in the third quarter of 1998, a decrease of 5.6%
on a reported basis.  International net sales on a constant U.S. dollar basis
increased 0.4% in the third quarter of 1999 as compared with the third quarter
of 1998.
    Selling, general and administrative expenses were $403.5 million, or 89.2%
of sales in the third quarter of 1999, compared to $322.6 million or 58.8% of
sales for the third quarter of 1998.  The increase is due in large measure to
the expected reduced levels of sales throughout the second half of 1999
coupled with the Company's decision to maintain its brand support which is
intended to drive consumer purchasing.
    Net loss was $164.7 million, or $3.21 per diluted share, in the third
quarter of 1999, including $4.4 million, or $0.09 per diluted share, for the
Company's restructuring program.  Net income was $12.7 million, or $0.24 per
diluted share, in the third quarter of 1998, including $7.1 million, or
$0.14 per diluted share, of non-recurring gains.

    NINE MONTHS RESULTS
    Net sales for the first nine months of 1999 decreased by 10.8% to
$1.4 billion on a reported basis or 8.4% on a constant U.S. dollar basis.
Operating loss for the first nine months of 1999 was $64.7 million before
restructuring charges of $22.1 million, compared with operating income for the
corresponding period in 1998 of $120.1 million before non-recurring gains of
$7.1 million.  EBITDA for the nine months ended September 30, 1999 was
$22.9 million before restructuring charges as compared with $196.8 million
before non-recurring gains for the first nine months of 1998.  Net loss was
$202.8 million, or $3.96 per diluted share, for the first nine months of 1999,
which included a charge of $22.1 million, or $0.43 per diluted share for the
Company's restructuring program.  Net loss was $74.1 million, or $1.42 per
diluted share, for the first nine months of 1998, which included $7.1 million,
or $0.14 per diluted share, of non-recurring gains, and a loss from
discontinued operations of $31.5 million, or $0.60 per diluted share, and
$51.7 million, or $0.99 per diluted share, of extraordinary charges in
connection with refinancings.
    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 brands include Revlon(R), Almay(R), Ultima
II(R), Charlie(R) and Flex(R), and they are sold in approximately
175 countries and territories.

    FORWARD-LOOKING STATEMENTS
    Information in this press release includes forward-looking statements made
pursuant to safe harbor provisions of the Private Securities Litigation Reform
Act of 1995.  Such statements include, without limitation, the Company's
expectations and estimates as to (i) the Company's intent to pursue the sale
of its worldwide Professional Products business and its non-core Latin
American brands, that it will consummate such sales during the first quarter
of 2000 and its expectations regarding the proceeds of such sales; (ii) future
financial performance, including operating loss before restructuring for 1999;
(iii) the Company's intention to work with its trade partners to complete its
program of achieving targeted inventory levels and to increase the efficient
introduction of new products into the marketplace; and (iv) the Company's
intention to drive consumer purchasing through brand support.  In addition to
the factors that are described in the Company's SEC filings, including its
annual and quarterly reports, the following factors could cause actual results
to differ materially from those expressed in the forward-looking statements:
(i) difficulties or delays in pursuing the sales of the Company's worldwide
Professional Products business and its non-core Latin American brands, the
inability to consummate such sales during the first quarter of 2000 or to
secure the expected level of proceeds from such sales; (ii) higher than
expected operating loss before restructuring for 1999; (iii) lower than
expected sales as a result of difficulties or delays in completing its program
of achieving targeted inventory levels; and (iv) difficulties or delays in
driving consumer purchasing through brand support.

                          REVLON, INC. AND SUBSIDIARIES
            UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
                   (dollars in millions, except per share data)

                              Three Months Ended          Nine Months Ended
                                September 30,               September 30,
                              1999          1998         1999          1998

    Net sales              $ 452.4       $ 548.6    $ 1,446.9     $ 1,621.7
    Cost of sales            170.0         186.1        510.6         543.4
    Gross profit             282.4         362.5        936.3       1,078.3
    Selling, general
     and administrative
     expenses                403.5         322.6      1,001.0         958.2
    Business consolidation
     costs and other, net      4.4         (7.1)         22.1         (7.1)

    Operating
     (loss) income         (125.5)          47.0       (86.8)         127.2

    Other expenses (income):
    Interest expense          36.8          33.0        108.6         103.3
    Interest income          (0.4)         (1.4)        (1.9)         (3.8)
    Amortization of debt
     issuance costs            0.8           1.1          3.3           3.9
    Foreign currency
     losses, net               0.2           1.9          0.2           4.7
    Miscellaneous, net       (0.1)           0.4          0.2           3.6
    Other expenses, net       37.3          35.0        110.4         111.7
    (Loss) income from
     continuing operations
     before income taxes   (162.8)          12.0      (197.2)          15.5

    Provision (benefit)
     for income taxes          1.9         (0.7)          5.6           6.4

    (Loss) income
     from continuing
     operations            (164.7)          12.7      (202.8)           9.1
    Loss from
     discontinued operations    --            --           --        (31.5)
    Extraordinary items -
     early extinguishments
     of debt                    --            --           --        (51.7)
    Net (loss) income    $ (164.7)        $ 12.7    $ (202.8)      $ (74.1)

    Basic (loss) income
     per common share:
    (Loss) income from
     continuing operations $(3.21)         $0.25      $(3.96)        $ 0.18
    Loss from
     discontinued operations    --            --           --        (0.62)
    Extraordinary items         --            --           --        (1.01)
    Net (loss) income
     per common share     $ (3.21)        $ 0.25     $ (3.96)      $ (1.45)

    Diluted (loss) income
     per common share:
    (Loss) income from
     continuing
     operations            $(3.21)         $0.24      $(3.96)        $ 0.17
    Loss from
     discontinued operations    --            --           --        (0.60)
    Extraordinary items         --            --           --        (0.99)
    Net (loss) income
     per common share      $(3.21)         $0.24      $(3.96)       $(1.42)

    Weighted average
     number of common
     shares outstanding:
    Basic               51,242,837    51,234,946   51,239,344    51,211,511
    Dilutive            51,242,837    52,175,749   51,239,344    52,326,097

                        REVLON, INC. AND SUBSIDIARIES
                    CONSOLIDATED CONDENSED BALANCE SHEETS
                            (dollars in millions)

                                               September 30,    December 31,
    ASSETS                                         1999             1998
                                                (Unaudited)
    Current assets:
    Cash and cash equivalents                     $97.7            $34.7
    Trade receivables, net                        447.7            536.0
    Inventories                                   301.6            264.1
    Prepaid expenses and other                     60.9             69.9
    Total current assets                          907.9            904.7
    Property, plant and equipment, net            359.3            378.9
    Intangible and other assets, net              532.1            546.4
    Total assets                               $1,799.3         $1,830.0

    LIABILITIES AND STOCKHOLDERS' DEFICIENCY

    Current liabilities:
    Short-term borrowings - third parties         $34.4            $27.9
    Current portion of long-term
     debt - third parties                           6.3              6.0
    Accounts payable,
     accrued expenses and other                   561.2            524.5
    Total current liabilities                     601.9            558.4
    Long-term debt                              1,835.1          1,654.0
    Other long-term liabilities                   246.2            265.6
    Total stockholders' deficiency              (883.9)          (648.0)
    Total liabilities and
     stockholders' deficiency                  $1,799.3         $1,830.0
SOURCE Revlon, Inc.
http://www.revlon.com
Company News On-Call:
http://www.prnewswire.com/comp/110701.html or fax,
800-758-5804, ext. 110701
CONTACT:
Press - Walter Montgomery, 212-527-5791, or
Investor Relations - Deena S. Fishman, 212-527-5230, both of
Revlon, Inc.