Elizabeth Arden (RDEN) 8-K Elizabeth Arden, Inc. Announces Second Quarter Results for Fiscal 2006

FOR IMMEDIATE RELEASE

ELIZABETH ARDEN, INC. ANNOUNCES SECOND QUARTER
RESULTS FOR FISCAL 2006

~ Net Sales of $346 million; Reported EPS of $1.12 ~
~ Reaffirming Full Year Net Sales and EPS Guidance ~
~ Significant Improvement in Cash Flow From Operations ~

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          New York, New York (February 2, 2006) -- Elizabeth Arden, Inc. (NASDAQ: RDEN), a global prestige beauty products company, today announced financial results for the second fiscal quarter ended December 31, 2005.

SECOND QUARTER RESULTS

          Net sales advanced 7.1% to $346.0 million for the three months ended December 31, 2005, from $323.0 million in the second quarter of the prior fiscal year. New products, including the PREVAGE™ skin care line, the fantasyBritney Spears fragrance, which ranked among the top three new fragrance launches in U.S. department stores, and the new Elizabeth Arden fragrance5^th Avenue after five led the growth. Net sales increased 8.2% excluding the unfavorable impact of foreign currency translation.

          Net income was $34.0 million, or $1.15 per diluted share, excluding the impact of FAS 123R, "Share-Based Payment," of $1.4 million before taxes, compared to $31.7 million, or $1.06 per diluted share, in the same period last year. On a reported basis, net income was $33.1 million, or $1.12 per diluted share, exceeding the Company's guidance.

          E. Scott Beattie, Chairman and Chief Executive Officer of Elizabeth Arden, Inc., commented, "We continue to be very excited about PREVAGEä , the breakthrough anti-aging treatment. PREVAGEä began appearing on counters at U.S. department stores largely in December and quickly became the number one selling skin care product in its category for the month. Sales activity has been accelerating in January, which is evidence that our advertising campaign is resonating well with consumers, and we intend to intensify our advertising efforts to increase awareness. In addition, PREVAGEä recently launched at Harrods in the U.K. as the exclusive European retailer and is on schedule to launch in other international accounts in the spring. The Harrods launch was extremely successful, and provides us additional confidence as we roll it out globally. Finally, our mass b usiness as a whole experienced solid sell-through performance, with holiday sets experiencing double-digits increases with the largest retailers."

          Mr. Beattie continued, "We also are extremely pleased with the success of our working capital initiatives. We reduced inventories by nearly $50 million year to date and increased inventory turns by 25% as compared to the prior year. This led to over a $60 million reduction in borrowings under our working capital facility, and is a testament to our company-wide focus on improving our return on invested capital.

          "As we look forward to the second half of the fiscal year, we are enthusiastic about the Daytona 500 fragrance launch in the U.S, the roll-out internationally offantasy and PREVAGEä and the introduction of the Britney Spears fragrancecurious In Control. Finally, our business strategy in Asia continues to develop. We just recently completed the acquisition of the assets of our distributor in Taiwan, which complements the August 2005 acquisition of our distributor in China," commented Mr. Beattie.

          The Company also noted that it recently added two key executives to its international operations. Smith Chih-Hsin Chen, President of Elizabeth Arden Greater China, joins the Company with extensive beauty sales and marketing experience and was previously a senior executive at Avon Products Inc., where he spent 20 years in various sales and operations positions in China, Taiwan and the U.S. Mr. Chen will be responsible for all of the sales, marketing and operational activities in the Greater China region. Tamara Minick-Scokalo, Senior Vice President, Europe, will be responsible for the sales and marketing activities in Western Europe, including management of all key European accounts. Ms. Minick-Scokalo has had a long career in sales and marketing at a number of leading consumer products companies, including Procter & Gamble where she was responsible for managing various pan-European businesses.

          Concluded Mr. Beattie, "These hires are part of our plan to accelerate the growth of our Northern Asia business and the growth and profitability of our business in Europe. Hiring key people in these regions allows us to maximize the significant brand recognition of the Elizabeth Arden name and capitalize on the significant growth opportunities that exist for our Company. While these initiatives were dilutive for the first half of fiscal 2006 and are expected to be so for the remainder of this fiscal year, we expect positive revenue and earnings contributions from these efforts in fiscal 2007."

SIX MONTHS RESULTS

          For the six-months ended December 31, 2005, net sales increased 7.1% to $573.3 million from $535.1 million from the six months ended December 31, 2004. Net income was $35.9 million versus $36.5 million for the year-ago period and earnings per share were $1.21, excluding the impact of FAS 123R, as compared to $1.23 in the prior year period. On a reported basis, earnings were $1.15 per share.

STOCK BUYBACK

          During the second quarter, the Company purchased 375,336 shares of common stock for a total purchase price of $7.2 million. The Company anticipates continuing its $40 million share repurchase program during the remainder of the 2006 fiscal year and fiscal 2007.

OUTLOOK

          Effective July 1, 2005, the Company adopted FAS 123R, "Share-Based Payment," a new accounting pronouncement requiring the expensing of stock-based compensation. Under this pronouncement, the Company has elected to apply the standard prospectively, and prior year results have not been restated. The earnings guidance, consistent with prior disclosure, includes a pre-tax charge of approximately $1.4 million for each of the third and fourth quarters of fiscal 2006, or $0.03 per diluted share, and a pre-tax charge of $5.7 million, or $0.13 per diluted share, for the full fiscal year related to this pronouncement. The earnings estimates exclude the debt extinguishment charge the Company incurred of $0.5 million, or $0.01 per diluted share, related to the early retirement of the $8.8 million of 11 3/4% Senior Subordinated Notes on February 1, 2006. This information is being provided for comparability purposes so that operating performance is pre sented on a consistent basis.

          For the full fiscal year, the Company is reaffirming its expectations for annual net sales of $980 million to $995 million and reported earnings per diluted share to range between $1.20 and $1.26. Foreign currency translation is estimated to negatively impact net sales growth by approximately 1.0%. Excluding the stock compensation expense related to the pronouncement mentioned above, earnings per diluted share are expected to range between $1.33 and $1.39.

          Regarding the second half of the fiscal year, the Company currently expects net sales and earnings to be weighted more heavily towards the fourth quarter than in the prior fiscal year. The guidance reflects the launches offantasy Britney Spears and PREVAGEä into international markets that will begin late this quarter, an increase in advertising and promotional expenses in the third quarter to support these new launches and the continued rationalization of inventory resulting from the Federated Department Store and The May Department Stores Company merger. Advertising and promotional costs are expected to increase double digits as compared to the third quarter of the prior fiscal year to support new products.

          As a result, the Company is introducing net sales guidance in the range of $195 million to $200 million and $215 million to $225 million for the third quarter and fourth quarters, respectively. Reported earnings per diluted share are currently estimated to range between $0.01 to $0.03 and $0.09 to $0.11 for the third quarter and fourth quarters, respectively.

CONFERENCE CALL INFORMATION

          The Company will host a conference call today at 10:00 a.m. Eastern Standard Time. All interested parties can listen to a live web cast of the conference call on the Company's web site at www.elizabetharden.com or at http://phx.corporate-ir.net/phoenix.zhtml?c=98237&p=irol-IRHome. An online archive of the broadcast will be available within one hour of the completion of the call and will be accessible on the Company's web site until February 16, 2006.

Elizabeth Arden is a global prestige beauty products company. The Company's portfolio of brands includes the fragrance brands ofElizabeth Arden: Red Door, Red Door Revealed, Elizabeth Arden 5^th Avenue, Elizabeth Arden after five, Elizabeth Arden green tea, and Elizabeth Arden Provocative Woman; the fragrance brands ofElizabeth Taylor: White Diamonds and Passion; the fragrances brands ofBritney Spears: curious, curious in control and fantasy; theDaytona 500and GANT adventuremen'sfragrances; and the fragrances White Shoulders,Geoffrey Beene's Grey Flannel, theHalstonbrands, Halston and Halston Z-14, PS Fine Cologne for Men, Design and Wings; theElizabeth Arden skin care lines, including Ceramide andEight Hour Cream, PREVAGE™ anti-aging treatment and the Elizabeth Arden color cosmetics line.

Company Contact:	Marcey Becker, Senior Vice President, Finance
	(203) 462-5809
Investor/Press Contact:	Allison Malkin/Michael Fox
	Integrated Corporate Relations
	(203) 682-8200

In connection with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Elizabeth Arden, Inc., is hereby providing cautionary statements identifying important factors that could cause our actual results to differ materially from those projected in forward-looking statements (as defined in such act). Any statements that are not historical facts and that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, through the use of words or phrases such as "will likely result," "are expected to," "will continue," "is anticipated," "estimated," "intends," "plans" and "projects") may be forward-looking and may involve estimates and uncertainties which could cause actual results to differ materially from those expressed in the forward-looking statements. Accordingly, any such statements are qualified in their entirety by reference to, and are accompanied by, the following key factors that have a direct bearing on our results of operations: our absence of contracts with customers or suppliers and our ability to maintain and develop relationships with customers and suppliers; international and domestic economic and business changes that could impact consumer confidence and operations; the impact of competitive products and pricing; risks of international operations, including foreign currency fluctuations, economic and political consequences of terrorist attacks, political instability in certain regions of the world, and external factors affecting customer purchasing patterns; our ability to successfully launch new products and implement our growth strategy; our ability to successfully and cost-effectively integrate acquired businesses or new brands; our substantial indebtedness, debt service obligations and restrictive covenants in our revolving credit facility and our indenture for our 7 3/4% senior subordinated notes; our customers' financial condition; our ability to access cap ital for acquisitions; changes in product mix to less profitable products; the retention and availability of key personnel; the assumptions underlying our critical accounting estimates; delays in shipments, inventory shortages and higher costs of production due to interruption of operations at key third party manufacturing or fulfillment facilities that manufacture or provide logistic services for the majority of our supply of certain products; changes in the retail, fragrance and cosmetic industries; our ability to protect our intellectual property rights; changes in the legal, regulatory and political environment that impact, or will impact, our business, including changes to customs or trade regulations or accounting standards; and other risks and uncertainties. We caution that the factors described herein could cause actual results to differ materially from those expressed in any forward-looking statements we make and that investors should not place undue reliance on any such forward-looking statements. Further, any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New factors emerge from time to time, and it is not possible for us to predict all of such factors. Further, we cannot assess the impact of each such factor on our results of operations or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

ELIZABETH ARDEN, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS DATA

(Unaudited)

(In thousands, except percentages and per share data)

			Three Months Ended						Six Months Ended
			December 31,			December 31,			December 31,			December 31,
			2005			2004			2005			2004
Net Sales			$	345,893		$	322,951		$	573,271		$	535,107
Cost of Sales				200,133			181,348			338,445			303,993
Gross Profit				145,760			141,603			234,826			231,114
Gross Profit Percentage  (a)				42.1	%		43.8	%		41.0	%		43.2	%
Selling, General and   Administrative Expenses				86,105			83,944			162,496			154,902
Depreciation and Amortization				5,376			5,449			10,649			10,982
Total Operating Expenses				91,481			89,393			173,145			165,884
Interest Expense, Net				6,662			6,274			12,776			12,259
Income Before Income Taxes				47,617			45,936			48,906			52,971
Provision for Income Taxes				14,523			14,210			14,916			16,462
Net Income			$	33,094		$	31,726		$	33,990		$	36,509
As reported:
	Basic Income Per Share		$	1.16		$	1.15		$	1.19		$	1.33
	Diluted Income Per Share		$	1.12		$	1.06		$	1.15		$	1.23
	Basic Shares			28,461			27,519			28,519			27,430
	Diluted Shares			29,484			29,888			29,615			29,743
	EBITDA  (b)		$	59,655		$	57,659		$	72,331		$	76,212
Adjusted before giving effect to   the adoption of FAS 123R,   share-based payments:  (c)
	Net Income		$	34,033		$	31,726		$	35,915		$	36,509
	Basic Income Per Share		$	1.20		$	1.15		$	1.26		$	1.33
	Diluted Income Per Share		$	1.15		$	1.06		$	1.21		$	1.23
	Basic Shares			28,461			27,519			28,519			27,430
	Diluted Shares			29,484			29,888			29,615			29,743
		EBITDA  (b)	$	61,006		$	57,659		$	75,101		$	76,212

(a)    Based on the percentage of net sales for the periods.

(b)    EBITDA is defined as net income plus the provision for income taxes (or net loss less the benefit from income taxes), plus interest expense, plus depreciation and amortization. EBITDA should not be considered as an alternative to operating income (loss) or net income (loss) (as determined in accordance with generally accepted accounting principles (GAAP)) as a measure of our operating performance or to net cash provided by operating, investing and financing activities (as determined in accordance with GAAP) as a measure of our ability to meet cash needs. We believe that EBITDA is a measure commonly reported and widely used by investors and other interested parties as a measure of a company's operating performance and debt servicing ability because it assists in comparing performance on a consistent basis without regard to capital structure, depreciation and amortization or non-operating factors (such as historical cost). Accordingly, as a result of our capital struc ture, we believe EBITDA is a relevant measure. This information has been disclosed here to permit a more complete comparative analysis of our operating performance relative to other companies and of our debt servicing ability. EBITDA may not, however, be comparable in all instances to other similar types of measures.

The following is a reconciliation of net income, as determined in accordance with GAAP, to EBITDA: (For a reconciliation of net income to EBITDA for prior periods, see the Company's filings with the Securities and Exchange Commission which can be found on the Company's website at www.elizabetharden.com).

		Three Months Ended				Six Months Ended
(In thousands)		December 31,		December 31,		December 31,		December 31,
		2005		2004		2005		2004
Net income		$	33,094	$	31,726	$	33,990	$	36,509
Plus:
	Provision for income taxes		14,523		14,210		14,916		16,462
	Interest expense, net		6,662		6,274		12,776		12,259
	Depreciation and amortization		5,376		5,449		10,649		10,982
EBITDA			59,655		57,659		72,331		76,212
Impact of adopting FAS 123R,   share-based payments			1,351		--		2,770		--
EBTIDA, excluding FAS 123R   costs		$	61,006	$	57,659	$	75,101	$	76,212

(c)   The following tables reconcile the calculation of net income per share on a basic and fully diluted basis from the amounts reported in accordance with GAAP to such amounts before giving effect to the impact of adopting FAS 123R, share-based payments, net of taxes. This disclosure is being provided because we believe it is meaningful to our investors and other interested parties to understand the Company's operating performance for comparability purposes and on a consistent basis without regard to the impact of adopting FAS 123R, share-based payments. The presentation of the non-GAAP information titled "Net income per share as adjusted, before giving effect to the adoption of FAS 123R, share-based payments, net of taxes" or "Net income per diluted share as adjusted, before giving effect to the adoption of FAS 123R, share-based payments, net of taxes" is not meant to be considered in isolation or as a substitute for net income or diluted income per share prepared in accorda nce with GAAP.

[Remainder of Page Intentionally left Blank]

(In thousands, except per share data)			Three Months Ended				Six Months Ended
			December 31,		December 31,		December 31,		December 31,
			2005		2004		2005		2004
As reported:
Basic
	Net income as reported		$	33,094	$	31,726	$	33,990	$	36,509
	Weighted average shares outstanding as reported			28,461		27,519		28,519		27,430
		Net income per basic share as reported	$	1.16	$	1.15	$	1.19	$	1.33
Diluted
	Net income as reported		$	33,094	$	31,726	$	33,990	$	36,509
	Weighted average shares and potential dilutive   shares as reported			29,484		29,888		29,615		29,743
		Net income per diluted share as reported	$	1.12	$	1.06	$	1.15	$	1.23
Adjusted before giving effect to the adoption of FAS   123R, share-based payments, net of taxes
Basic
	Net income as reported		$	33,094	$	31,726	$	33,990	$	36,509
	Impact of adopting FAS 123R, share-based   payments, net of taxes			939		--		1,925		--
		Net income attributable to common   shareholders as adjusted, before giving effect   to the adoption of FAS 123R, share-based   payments, net of taxes	$	34,033	$	31,726	$	35,915	$	36,509
	Weighted average shares outstanding as reported			28,461		27,519		28,519		27,430
		Net income per share as adjusted, before giving   effect to the adoption of FAS 123R, share-   based payments, net of taxes	$	1.20	$	1.15	$	1.26	$	1.33
Diluted
	Net income as reported		$	33,094	$	31,726	$	33,990	$	36,509
	Impact of adopting FAS 123R, share-based   payments, net of taxes			939		--		1,925		--
		Net income as adjusted, before giving effect to   the adoption of FAS 123R, share-based   payments, net of taxes	$	34,033	$	31,726	$	35,915	$	36,509
	Weighted average shares and potential dilutive   shares as reported			29,484		29,888		29,615		29,743
	Net income per diluted share as adjusted, before   giving effect to the adoption of FAS 123R,   share-based payments, net of taxes		$	1.15	$	1.06	$	1.21	$	1.23

ELIZABETH ARDEN, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)	December 31, 2005		June 30, 2005		December 31, 2004
Cash	$	20,957	$	25,316	$	34,311
Accounts Receivable, Net		221,939		149,965		197,974
Inventories		227,261		273,343		259,709
Property and Equipment, Net		32,625		29,184		39,388
Exclusive Brand Licenses, Trademarks and Intangibles, Net		184,908		186,527		188,059
Total Assets		725,985		719,897		755,544
Short-Term Debt		20,474		47,700		83,096
Current Portion of Long-Term Debt		8,802		--		--
Current Liabilities		198,503		219,484		273,333
Long-Term Liabilities		234,351		241,213		236,892
Total Debt		254,276		281,502		316,898
Shareholders' Equity		293,131		259,200		245,319
Working Capital		301,341		275,628		237,976

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