Exhibit 99.1
FOR IMMEDIATE RELEASE
Revlon Reports First Quarter 2002 Performance
NEW YORK, May 9, 2002 - Revlon, Inc. (NYSE:REV) today announced first quarter
2002 results. In the first quarter 2002, Revlon's net loss per share from
ongoing operations(1) was $0.65 compared to First Call consensus estimate of a
net loss per share of $0.69.
Please read the notes at the end of this release for a detailed description of
ongoing operations and the tabular reconciliation of results as reported to
results from ongoing operations.
Comparison of Ongoing Operations - First Quarter(1),(2)
The financial information for our ongoing operations for the 2002 and 2001
periods is provided to allow a comparison of results solely from ongoing
operations. Net sales in the first quarter of 2002 were $275.4 million,
compared with $303.8 million in the first quarter of 2001, a decrease of 9.3%
or 6.3% on a comparable currency basis. Operating income was $7.0 million in
the first quarter of 2002, compared with $12.5 million in the first quarter of
2001.
EBITDA(3) was $30.2 million in the first quarter of 2002, compared with $35.4
million in the first quarter of 2001, and net loss in the first quarter 2002
was $33.8 million, or $0.65 per diluted share, compared with $24.7 million, or
$0.47 per diluted share, for the first quarter of 2001.
In North America, which includes the U.S. and Canada, net sales were $196.4
million for the first quarter of 2002, compared with $212.5 million in the
first quarter of 2001, a decrease of 7.6%. This decrease was driven primarily
by lower shipments to our retail customers as a result of the decision by two
major U.S. retailers to shift the timing plan-o-gram resets for certain 2002
new products. This resulted in shipments of approximately $14 million of 2002
new products in the fourth quarter 2001.
International net sales were $79.0 million for the first quarter of 2002,
compared with $91.3 million in the first quarter of 2001, a decrease of 13.5%,
or 3.6% on a constant dollar basis, primarily due to lower sales in the
European region, and lower sales in Argentina and Venezuela primarily due to
political and economic conditions in those two countries.
Results As Reported - First Quarter(2)
Net sales in the first quarter 2002 were $275.4 million, compared with net
sales of $313.6 million in the first quarter 2001. The 2001 period includes
sales from the Colorama business, which we disposed of in July 2001.
Including restructuring costs of $4.0 million in the first quarter 2002 and
$14.6 million in the first quarter 2001, business consolidation costs of $0.8
million in the first quarter 2002 and $8.1 million in the first quarter 2001,
and executive severance costs of $6.5 million in the first quarter 2002,
operating loss was $4.3 million in the first quarter 2002 versus an operating
loss of $9.5 million in the first quarter 2001. Also including the
aforementioned costs, net loss in the first quarter 2002 was $46.1 million, or
$0.88 per diluted share, compared with a net loss of $46.5 million, or $0.89
per diluted share, in the first quarter of 2001.
U.S. Mass-Market Consumption Up at Retail(4)
Market Share Highlights and Brand Support
According to ACNielsen, in the first quarter of 2002, the combined dollar
consumption (which means products purchased by consumers from our retail
customers) of our color cosmetics, skin care, women's hair coloring,
anti-perspirant/deodorant and beauty tools in the U.S. mass-market grew by
2.0% versus the prior year quarter and by 5.7% versus the fourth quarter 2001.
There was consumption growth in Revlon brand color cosmetics, Revlon brand
hair color, Almay brand skin care, and Mitchum brand
anti-perspirant/deodorants. This consumption growth was partially offset by
declines in Almay brand color cosmetics. Revlon brand U.S. mass-market color
cosmetics dollar consumption increased versus the prior year quarter by 2.6%.
In terms of dollar market share, we experienced declines versus the 2001 first
quarter and increases versus the fourth quarter 2001 in Revlon and Almay brand
color cosmetics. We experienced increases in dollar market share versus the
2001 first quarter in skin care and women's hair coloring and
anti-perspirant/deodorant, and a decrease in beauty tools dollar market share.
Revlon brand color cosmetics dollar market share in the first quarter 2002 was
16.1% versus 16.7% in the first quarter 2001 and 15.9% in the fourth quarter
2001. Almay brand color cosmetics dollar market share in the first quarter
2002 was 5.7% versus 6.5% in the first quarter 2001 and 5.6% in the fourth
quarter 2001.
Total brand support expense, includes all expenses incurred (except permanent
display amortization) to support our brands to increase consumption at our
retail customers, as a percent of gross sales was 24.8%, or $84.4 million, in
the first quarter of 2002 compared with 22.0%, or $81.2 million, in the first
quarter of 2001.
CEO Comments
President and Chief Executive Officer Jack Stahl said, "Since joining in
February, I have spent much of my time at Revlon performing a detailed
analysis of the Company's business, meeting with employees and customers, and
working with my management team to develop a comprehensive strategy.
After a successful cost reduction effort completed in 2001, we are devoting
greater energy and attention to what Revlon does best - the development and
marketing of innovative cosmetics and personal care products. Improving
overall execution at all areas of our business and developing and executing
consumer and retail partner based growth strategies, will be our primary focus
for the foreseeable future. To improve overall execution, we are improving
various processes within Revlon, spanning from when products are first
conceived to when products leave the retail store in the hands of satisfied
consumers. Revlon is a great company with great brands and talented and
dedicated people. With the right focus and with better execution and brand
positioning, we can take Revlon to the next level.
We look forward to sharing our strategies for growth with investors and
analysts at a conference, which we have tentatively scheduled for August 2nd
in New York City. At that time, our leadership team will talk about where
Revlon is today and the growth opportunities we see for Revlon in the future."
The Company will host an analyst call on May 9, 2002 at 10:30 a.m. EST to
discuss first quarter 2002 results. The conference call will be webcast on our
website www.revloninc.com so it is available to the public on a real time
basis.
About Revlon
Revlon is a worldwide cosmetics, skincare, fragrance, and personal care
products company. The Company's vision is to become the world's most dynamic
leader in global beauty and skincare. Websites featuring current product and
promotional information, as well as corporate investor relation's information,
can be reached at www.RevlonInc.com, www.Revlon.com, and www.Almay.com. The
Company's brands include Revlon(R), Almay(R), Ultima(R), Charlie(R) and
Flex(R) and they are sold worldwide.
Footnotes to Press Release
(1) Ongoing operations are presented in order to provide a comparative analysis
of our results of operations for the periods presented by eliminating the
gains, losses and results of businesses and brands which have been sold.
Excludes restructuring costs of $4.0 million and $14.6 million in the
first quarter of 2002 and 2001, respectively, and additional
consolidation costs of $0.8 million and $8.1 million in the first quarter
of 2002 and 2001, respectively, primarily associated with the closing of
the Phoenix facility. Also excludes executive severance costs of $6.5
million in the first quarter 2002.
(2) 2001 results have been reclassified to reflect the change in presentation
for the second portion of EITF 01-09, "Accounting for Consideration Given
by a Vendor to a Customer or Reseller of the Vendor's Products,"
(formerly EITF 00-25), which addresses accounting for sales incentives.
(3) EBITDA throughout this press release is defined as earnings from the
Company's ongoing operations before interest, taxes, depreciation and
amortization (including non-cash compensation) (or operating
income/(loss) from ongoing operations plus depreciation and amortization
expenses). EBITDA is presented here as a measure of our debt service
ability, not of our operating results. EBITDA should not be considered in
isolation, as a substitute for net income/(loss) or cash flow from
operations prepared in accordance with accounting principles generally
accepted in the United States of America or as a measure of our
profitability or liquidity. EBITDA is defined differently in our credit
agreement.
(4) All market share and consumption data is 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
which no longer reports its results to ACNielsen. This represents
approximately 60%-65% of the Company's U.S. mass-market volume.
You may visit our website, www.revloninc.com, for a Statement of Ongoing
Operations for the quarters ended March 31, 2002 and March 31, 2001, and year
ended December 31, 2001. See the reconciliation of reported results to ongoing
operations reported herein.
Forward-Looking Statements
Statements 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 to disclose material information under the U.S. federal securities
laws, the Company undertakes no obligation to publicly update any
forward-looking statements, whether as a result of new information, future
events or otherwise. Investors are advised, however, to consult any additional
disclosures the Company makes in its Quarterly Reports on Form 10-Q, Annual
Report on Form 10-K and Current Reports on Form 8-K to the Securities and
Exchange Commission (which, among other places, can be found on the SEC's
website at http://www.sec.gov or on the Company's website at
http://www.revloninc.com). Such forward looking statements include, without
limitation, the Company's expectations and estimates about future events
including the Company's expectations regarding: (i) improving overall
execution at all levels of the Company's business; (ii) developing and
executing consumer and retail partner-based growth strategies; (iii) improving
various processes within the Company; and (iv) achieving the next level of the
Company's strategic plan.
Actual results may differ materially from such forward-looking statements for
a number of reasons, including those set forth in the Company's filings with
the SEC, including its Form 10-K for 2001, and reasons including difficulties,
delays in or the inability of the Company to: (i) improve overall execution at
all levels of the Company's business; (ii) develop and execute consumer and
retail partner-based growth strategies; (iii) improve various processes within
the Company; and (iv) achieve the next level of the Company's strategic plan.
Factors other than those listed above could cause the Company's results to
differ materially from expected results.
The reference to First Call consensus estimates is for comparison purposes
only. The Company does not intend to adopt or endorse such estimates.
REVLON, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(dollars in millions, except per share data)
Three Months Ended
March 31,
------------------------------------
2002 2001
--------------- ----------------
Net sales $ 275.4 313.6
Cost of sales 109.0 131.6
--------------- ----------------
Gross profit 166.4 182.0
Selling, general and administrative expenses 166.7 176.9
Restructuring costs 4.0 14.6
--------------- ----------------
Operating loss (4.3) (9.5)
--------------- ----------------
Other expenses (income):
Interest expense 39.2 35.2
Interest income (0.5) (0.9)
Amortization of debt issuance costs 1.9 1.8
Foreign currency gains, net (0.6) (0.4)
Loss on sale of assets, net 1.0 -
Miscellaneous, net 0.7 0.8
--------------- ----------------
Other expenses, net 41.7 36.5
--------------- ----------------
Loss before income taxes (46.0) (46.0)
Provision for income taxes 0.1 0.5
--------------- ----------------
Net loss $ (46.1) $ (46.5)
=============== ================
Basic and diluted net loss per common share $ (0.88) $ (0.89)
=============== ================
Weighted average number of common shares outstanding:
Basic and diluted 52,199,468 52,199,268
=============== ================
REVLON, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(dollars in millions)
March 31, December 31,
ASSETS 2002 2001
----------- -----------
(Unaudited)
Current assets:
Cash and cash equivalents $ 67.5 $ 103.3
Marketable securities - 2.2
Trade receivables, net 189.8 203.9
Inventories 167.6 157.9
Prepaid expenses and other 47.6 45.6
----------- -----------
Total current assets 472.5 512.9
Property, plant and equipment, net 139.8 142.8
Intangible and other assets, net 342.9 341.9
----------- -----------
Total assets $ 955.2 $ 997.6
=========== ===========
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
Current liabilities:
Short-term borrowings - third parties $ 22.3 $ 17.5
Accounts payable, accrued expenses and other 364.8 368.3
----------- -----------
Total current liabilities 387.1 385.8
Long-term debt 1,650.0 1,643.6
Other long-term liabilities 252.5 250.9
Total stockholders' deficiency (1,334.4) (1,282.7)
----------- -----------
Total liabilities and stockholders' deficiency $ 955.2 $ 997.6
=========== ===========
REVLON, INC. AND SUBSIDIARIES
UNAUDITED SUMMARY ONGOING FINANCIAL DATA
(dollars in millions, except per share data)
Quarter Ended March 31, 2002:
- -----------------------------
Restructuring
Brand and costs and Ongoing
As reported facilities sold other, net Operations
-------------- -------------- -------------- --------------
Net sales $ 275.4 $ - $ - $ 275.4
Gross profit 166.4 - 0.7 167.1
Selling, general and administrative expenses 166.7 - (6.6) 160.1
Restructuring costs and other, net 4.0 - (4.0) -
-------------- -------------- -------------- --------------
Operating (loss) income (4.3) - 11.3 7.0
Other expenses, net 41.7 (1.0) - 40.7
-------------- -------------- -------------- --------------
Loss before income taxes (46.0) 1.0 11.3 (33.7)
Net loss $ (46.1) $ 1.0 $ 11.3 $ (33.8)
Diluted (loss) per common share
Loss before extraordinary item $ (0.88) $ 0.02 $ 0.22 $ (0.65)
EBITDA:
Operating (loss) income $ (4.3) $ - $ 11.3 $ 7.0
Depreciation and amortization 23.4 - (0.2) 23.2
-------------- -------------- -------------- --------------
EBITDA $ 19.1 $ - $ 11.1 $ 30.2
============== ============== ============== ==============
Quarter Ended March 31, 2001:
- ---------------------------------------------
Restructuring
Brand and costs and Ongoing
As reported facilities sold other, net Operations
-------------- -------------- -------------- --------------
Net sales $ 313.6 $ (9.8) $ - $ 303.8
Gross profit 182.0 (4.2) 6.4 184.2
Selling, general and administrative expenses 176.9 (3.5) (1.7) 171.7
Restructuring costs and other, net 14.6 - (14.6) -
-------------- -------------- -------------- --------------
Operating (loss) income (9.5) (0.7) 22.7 12.5
Other expenses, net 36.5 - 0.1 36.6
-------------- -------------- -------------- --------------
Loss before income taxes (46.0) (0.7) 22.6 (24.1)
Net loss $ (46.5) $ (0.8) $ 22.6 $ (24.7)
Diluted (loss) per common share
Loss before extraordinary item $ (0.89) $ (0.02) $ 0.43 $ (0.47)
EBITDA:
Operating (loss) income $ (9.5) $ (0.7) $ 22.7 $ 12.5
Depreciation and amortization 29.6 (0.5) (6.2) 22.9
-------------- -------------- -------------- --------------
EBITDA $ 20.1 $ (1.2) $ 16.5 $ 35.4
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Contact:
Revlon, New York
Investor Relations: Media Contact:
Laura Kiernan Catherine Fisher
(212) 527-5230 (212) 527-5727