Revlon sales drop 18% as Covid-19 takes its toll
NYC-based cosmetics conglomerate Revlon, Inc. announced an 18.1% decline in its first-quarter revenues on Monday, as store closures related to the Covid-19 pandemic left a significant dent in the company’s sales.
For the first quarter ended March 31, 2020, Revlon’s net sales totaled $453.0 million, down from $553.2 million in the prior-year period, reflecting an estimated $54 million in negative impacts resulting from the coronavirus crisis.
The company’s Revlon segment, which is made up of its flagship namesake brands, achieved quarterly sales of $181.8 million, down 26.5% from the same period in the previous year, while the Elizabeth Arden segment saw its net sales tumble 14.5% to $95.2 million, as lower skincare and color cosmetics revenues were partially offset by increases in Ceramide skincare sales.
The portfolio segment, which includes brands such as Almay, SinfulColors, American Crew, CND and Cutex, posted net sales of $110.0 million, down 6.1% year over year, with higher revenues from Mitchum anti-perspirant deodorants and Cutex nailcare products helping to make up for declines in color cosmetics and men’s grooming.
Quarterly sales in Revlon’s fragrance segment were $66.0 million, representing a 14.6% decrease when compared to the same period in the previous year.
By geography, Revlon saw a 16.2% revenue drop in North America, where sales totaled $233.5 million, down from $278.7 million, while international sales fell 20.0%, from $274.5 million to $219.5 million.
Revlon president and CEO Debbie Perelman was, however, keen to highlight the progress made in the company’s e-commerce business in a press release, pointing out that sales in the channel grew 47% year over year, and represented more than 12% of the group’s total sales for Q1.
Nonetheless, Revlon’s quarterly net loss widened to $213.9 million, or $4.02 per diluted share, versus a net loss of $75.1 million, or $1.42 per diluted share, in the prior-year period.
“Although our business was significantly impacted during the first quarter of 2020 by the ongoing global Covid-19 pandemic, we have taken aggressive steps to mitigate these effects and feel confident that we will emerge well positioned to continue our transformation and maintain our leadership position within the beauty category,” insisted Perelman. “Beauty is a resilient industry and we are already seeing signs of a return to strong sales activity in China and other markets.”
As companies resort to a range of different strategies to maintain liquidity during the health crisis, Revlon closed on a new $880 million term loan facility on May 7, 2020, using a portion of it to retire its $200 million 2019 term loan facility.
According to Revlon, it currently has approximately $600 million in total available liquidity.
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