Operating Income Growth Continued in the
Fourth Quarter
Strong Growth in Key Sectors Including
E-Commerce, Elizabeth Arden, China and Travel Retail
Revlon, Inc. (NYSE:REV) today announced its unaudited1 fourth
quarter and full year 2018 financial results. As disclosed in a
Form 12b-25 that the Company filed with the SEC today, the Company
requires additional time to finalize management’s assessment and
the audit of the effectiveness of internal control over financial
reporting as of December 31, 2018. The Company expects to disclose
in its 2018 Form 10-K that it identified a material weakness in its
internal control over financial reporting as of year-end 2018,
primarily related to the lack of design and maintenance of
effective controls in connection with the previously-disclosed
implementation of its enterprise resource planning system in the
U.S. The Company will file its 2018 Form 10-K by no later than
March 29, 2019, within the 15 calendar-day extension afforded by
Rule 12b-25. The Company expects that these matters will not
result in any changes to its financial results.
Quarter ended December 31, 2018 summary developments:2
- As Reported net sales were $741.6
million in the fourth quarter of 2018, compared to $786.6 million
during the prior-year period, a decrease of 5.7% versus the
prior-year period. On a constant currency basis, net sales declined
$28.9 million or 3.7% versus the prior-year period. The net sales
decrease was driven by several one-time items including lower net
sales in the Revlon segment due in part to the shift in timing of
customer resets from the fourth quarter of 2018 into late first
quarter of 2019 and lower net sales in the Fragrances segment
driven by several expired brand licenses in 2018. The net sales
decline was partially offset by strong double digit growth in the
Elizabeth Arden segment, particularly within e-commerce, Travel
Retail and strong results in China.
- As Reported operating income increased
65.1% to $32.2 million in the fourth quarter of 2018, which
included the impact of non-cash pre-tax items totaling $37.1
million, consisting of an $18.0 million goodwill impairment charge
related to the Mass Portfolio reporting unit and $19.1 million of
accelerated amortization related to Pure Ice brand intangible
assets. The higher As Reported operating income was driven by lower
selling, general and administrative expenses, mainly attributed to
lower overhead costs and lower brand support in the Portfolio,
Fragrances, and Elizabeth Arden segments due primarily to the
re-phasing of marketing initiatives, as well as lower acquisition
and integration costs in the fourth quarter of 2018.
- As Reported net loss was $70.3 million
in the fourth quarter of 2018, representing an 8.6% improvement
over the prior-year period. The lower net loss was driven by the
higher operating income described above, partially offset by higher
interest expense. As Reported net loss included the impact of
non-cash after-tax items totaling $81.5 million, consisting of a
$49.0 million non-cash increase in tax valuation allowances and the
previously noted impairment and accelerated amortization
items.
- Adjusted EBITDA(a) of $124.6 million in
the fourth quarter of 2018 improved 12.8% compared to the
prior-year period, primarily driven by the factors described
above.
"We are very pleased with our continued momentum during the
fourth quarter of 2018 as we successfully execute on our core
strategies and business transformation. I am particularly
encouraged by strong growth in some of the key areas that we have
intensely focused on such as e-commerce, Elizabeth Arden skincare,
China and Travel Retail. Our digital strategy continues to pay off
as we once again achieved double-digit e-commerce growth, due in
part to strong performance from major consumer events including
Singles Day in China and Black Friday in North America. As a result
of improved operational performance, we achieved strong Adjusted
EBITDA growth during the second half of 2018, and together with the
recently-announced 2018 Optimization Program, I believe we are well
positioned for long-term success," said Debra Perelman, President
and CEO of Revlon.
1 See "Notices to Investors - Unaudited Results" below in the
footnotes to this release.
2 The results discussed include the following measures: U.S.
GAAP (“As Reported”); and non-GAAP (“Adjusted”), which excludes
certain Non-Operating Items and EBITDA Exclusions (as defined in
Footnote (a)) from As Reported results. See footnote (a) for
further discussion of the Company’s Adjusted measures.
Reconciliations of As Reported results to Adjusted results are
provided as an attachment to this release. In addition, where
indicated, the Company analyzes and presents its results excluding
the impact of foreign currency translation (“XFX”). Unless
otherwise noted, the discussion is presented on an As Reported
basis.
Fourth Quarter 2018
Results
Total Company Results
In calculating Adjusted results, adjustments were made for the
Non-Operating Items, and the EBITDA Exclusions in the case of
Adjusted EBITDA, in each case as described in footnote (a).
(USD millions, except per share data)
Three Months Ended December
31,(Unaudited)
2018 2017
AsReported
Adjusted(*)
AsReported
Adjusted(*)
AsReported
Adjusted(*)
% Change % Change Net Sales $ 741.6 $ 743.0 $ 786.6 $ 786.6
(5.7 )% (5.5 )% Gross Profit 431.8 435.8 458.7 459.1 (5.9 )% (5.1
)% Gross Margin 58.2 % 58.7 % 58.3 % 58.4 % -10bps 30bps Operating
Income $ 32.2 $ 64.4 $ 19.5 $ 65.5 65.1 % (1.7 )% Adjusted EBITDA
124.6 110.5 12.8 % Net Loss (70.3 ) (45.7 ) (76.9 ) (45.2 ) 8.6 %
(1.1 )% Diluted Loss per Common Share $ (1.33 ) $
(0.86 ) $ (1.46 ) $ (0.86 ) 8.9 % — %
(*) Refer to footnote (a) to this Earnings Release for a discussion
and reconciliation of our non-GAAP measures, including Adjusted Net
Sales, Adjusted Gross Profit, Adjusted Gross Profit Margin,
Adjusted Operating Income, Adjusted EBITDA, Adjusted Net Income
(Loss) and Adjusted Diluted Loss per Common Share.
Segment
Results
Effective January 1, 2018, the Company began reporting its
results under four new reporting segments: Revlon; Elizabeth Arden;
Portfolio brands; and Fragrances, as it began to operate under a
new brand-centric organizational structure built around four global
brand teams. These four reporting segments are:
Revlon - The Revlon segment is
comprised of the Company's flagship Revlon brands. Revlon segment
products are primarily marketed, distributed and sold in the mass
retail channel, large volume retailers, chain drug and food stores,
chemist shops, hypermarkets, general merchandise stores, e-commerce
sites, television shopping, department stores, professional hair
and nail salons, one-stop shopping beauty retailers and specialty
cosmetic stores in the U.S. and internationally under brands such
as Revlon in color cosmetics; Revlon ColorSilk and
Revlon Professional in hair color; and Revlon in
beauty tools.
Elizabeth Arden - The Elizabeth Arden
segment is comprised of the Company's Elizabeth Arden branded
products. The Elizabeth Arden segment markets, distributes and
sells fragrances, skin care and color cosmetics primarily to
prestige retailers, department and specialty stores, perfumeries,
boutiques, e-commerce sites, the mass retail channel, travel
retailers and distributors, as well as direct sales to consumers
via its Elizabeth Arden branded retail stores and
elizabetharden.com e-commerce website, in the U.S. and
internationally, under brands such as Elizabeth Arden Ceramide,
Prevage, Eight Hour, SUPERSTART, Visible Difference and Skin
Illuminating in the Elizabeth Arden skin care brands; and
Elizabeth Arden White Tea, Elizabeth Arden Red Door, Elizabeth
Arden 5th Avenue and Elizabeth Arden Green Tea in
Elizabeth Arden fragrances.
Portfolio - The Company’s Portfolio
segment markets, distributes and sells a comprehensive line of
premium, specialty and mass products primarily to the mass retail
channel, hair and nail salons and professional salon distributors
in the U.S. and internationally and large volume retailers,
specialty and department stores under brands such as Almay
and SinfulColors in color cosmetics; American Crew in
men’s grooming products (which are also sold direct-to-consumer on
its americancrew.com website); CND in nail polishes, gel
nail color and nail enhancements; Mitchum in anti-perspirant
deodorants; Cutex nail care products; and Pure Ice in
nail polishes. The Portfolio segment also includes a multi-cultural
hair care line consisting of Creme of Nature hair care
products, which are sold in both professional salons and in large
volume retailers and other retailers, primarily in the U.S.; and a
body care line under the Natural Honey brand and a hair
color line under the Llongueras brand (licensed from a third
party) that are both sold in the mass retail channel, large volume
retailers and other retailers, primarily in Spain.
Fragrances - The Fragrances segment
includes the development, marketing and distribution of certain
owned and licensed fragrances, as well as the distribution of
prestige fragrance brands owned by third parties. These products
are typically sold to retailers in the U.S. and internationally,
including prestige retailers, specialty stores, e-commerce sites,
the mass retail channel, travel retailers and other international
retailers. The owned and licensed fragrances include brands such as
Juicy Couture (which are also sold direct-to-consumer on its
juicycouturebeauty.com website), Britney Spears, Elizabeth
Taylor, Curve, John Varvatos, Christina Aguilera, Giorgio
Beverly Hills, Ed Hardy, Charlie, Lucky Brand,
Paul Sebastian, Alfred Sung, Jennifer Aniston,
Mariah Carey, Halston, Geoffrey Beene, La
Perla, White Shoulders, AllSaints and Wildfox.
Effective January 1, 2018, segment profit includes the
allocation of corporate expenses, as these expenses are included in
segment operating performance. Segment profit has been adjusted for
the prior-year period to conform to this methodology.
(USD
millions)
Three Months Ended December
31,(Unaudited)
Net Sales As Reported As Reported 2018 2017 % Change
XFX% Change Revlon $ 261.4 $ 301.5 (13.3 )% (11.2 )%
Elizabeth Arden 156.3 132.2 18.2 % 21.1 % Portfolio 144.1 154.6
(6.8 )% (4.0 )% Fragrances 179.8 198.3 (9.3 )% (8.5
)% Total $ 741.6 $ 786.6 (5.7 )% (3.7 )%
Three Months Ended December
31,(Unaudited)
Segment Profit As Reported As Reported 2018 2017 % Change XFX%
Change Revlon $ 54.0 $ 82.0 (34.1 )% (32.1 )% Elizabeth
Arden 22.1 4.6 380.4 % 402.2 % Portfolio 13.7 0.4 N.M. N.M.
Fragrances 34.8 23.5 48.1 % 48.5 % Total
$ 124.6 $ 110.5
12.8 % 15.9 %
Revlon Segment
Revlon segment net sales in the fourth quarter of 2018 were
$261.4 million, a 13.3% (or 11.2% XFX) decrease compared to the
prior-year period, driven by lower net sales of Revlon color
cosmetics due in part to declines in the North America mass color
cosmetics category and a shift in timing of customer resets from
the fourth quarter of 2018 into late first quarter of 2019,
partially offset by higher net sales in Revlon-branded professional
and haircare product lines. The resets are now complete in the
U.S.
Revlon segment profit in the fourth quarter of 2018 was $54.0
million, compared to $82.0 million in the prior-year period,
primarily driven by the segment's net sales decline and increased
investment in brand support.
Elizabeth Arden Segment
Elizabeth Arden segment net sales in the fourth quarter of 2018
were $156.3 million, a 18.2% (or 21.1% XFX) increase compared to
the prior-year period, primarily driven by the segment's higher net
sales of Elizabeth Arden skin care products, including Ceramide and
Prevage, primarily internationally.
Elizabeth Arden segment profit in the fourth quarter of 2018 was
$22.1 million, compared to $4.6 million in the prior-year period,
primarily due to the segment's higher net sales and lower brand
support expenses.
Portfolio Segment
Portfolio segment net sales of $144.1 million in the fourth
quarter of 2018 decreased by 6.8% (or 4.0% XFX) compared to the
prior-year period, primarily driven by the segment's lower net
sales of local and regional brands as well as CND gel nail color,
partially offset by higher net sales of Almay color cosmetics,
American Crew men's grooming products and Mitchum anti-perspirant
deodorants.
Portfolio segment profit in the fourth quarter of 2018 was $13.7
million, compared to $0.4 million in the prior-year period,
primarily as a result of lower brand support expenses, partially
offset by the segment's lower net sales.
Fragrances Segment
Fragrances segment net sales of $179.8 million in the fourth
quarter of 2018 decreased by 9.3% (or 8.5% XFX) compared to the
prior-year period, driven primarily by several expired brand
licenses in 2018 and lower net sales of other licensed fragrances
due to weakness in the mass retail channel, partially offset by new
product launches.
As a result of the Fragrances segment's realization of cost
reductions principally associated with insourcing production
capabilities and lower brand support expenses, segment profit
increased by 48.1% (or 48.5% XFX) in the fourth quarter of 2018
compared to the prior-year period, despite the lower net sales.
Geographic Net Sales
Overall, As Reported net sales decreased by 5.7%, as detailed
below by segment for the Company's North America and International
Regions.
(USD
millions)
Three Months Ended December
31,(Unaudited)
2018As Reported 2017As Reported As Reported% Change
As ReportedXFX% Change
Net Sales: Revlon North America $ 134.1 $ 169.8 (21.0 )% (20.8 )%
International 127.3 131.7 (3.3 )% 1.2 % Elizabeth Arden North
America $ 39.4 $ 36.9 6.8 % 7.6 % International 116.9 95.3 22.7 %
26.3 % Portfolio North America $ 85.6 $ 89.5 (4.4 )% (4.4 )%
International 58.5 65.1 (10.1 )% (3.8 )% Fragrances North America $
129.0 $ 134.7 (4.2 )% (4.1 )% International 50.8 63.6
(20.1 )% (17.9 )% Total Net Sales 1 $ 741.6 $ 786.6 (5.7 )%
(3.8 )%
Total Net Sales
Summary North America $
388.1 $ 430.9 (9.9 )% (9.8 )% International
353.5 355.7 (0.6
)% 3.6 % 1 As Reported net sales in North America includes
the impact of $1.4 million of costs incurred in the fourth quarter
of 2018 related to the service level disruptions at the Company's
Oxford, N.C. manufacturing facility.
Revlon Segment
In North America, Revlon segment net sales of $134.1 million in
the fourth quarter of 2018 decreased by 21.0% (or 20.8% XFX)
compared to the prior-year period, largely driven by declines in
the U.S. mass channel due to overall weak U.S. mass category
performance, the shift in timing of customer resets from the fourth
quarter of 2018 into late first quarter of 2019 and the timing of
innovation pipeline that benefited the 2017 period.
In International, Revlon segment net sales of $127.3 million in
the fourth quarter of 2018 decreased by 3.3% (or increased 1.2%
XFX) compared to the prior-year period, driven by declines in
Revlon color cosmetics and the timing of innovation pipeline that
benefited the 2017 period.
Elizabeth Arden Segment
In North America, Elizabeth Arden segment net sales were $39.4
million in the fourth quarter of 2018, an increase of 6.8% (or 7.6%
XFX) compared to the prior-year period, primarily due to higher net
sales of skin care products, partially offset by decreased net
sales resulting from retail store closures.
In International, Elizabeth Arden segment net sales of $116.9
million in the fourth quarter of 2018 increased by 22.7% (or 26.3%
XFX) compared to the prior-year period, primarily driven by higher
net sales of skin care products within the Company's Travel Retail
business and Asia region, particularly in China.
Portfolio Segment
In North America, Portfolio segment net sales of $85.6 million
in the fourth quarter of 2018 decreased by 4.4% compared to the
prior-year period, primarily driven by overall U.S. mass category
softness, partially offset by higher net sales of American Crew
men's grooming products.
In International, Portfolio segment net sales of $58.5 million
in the fourth quarter of 2018 decreased by 10.1% (or 3.8% XFX)
compared to the prior-year period, driven by lower net sales of
local and regional brands and CND gel nail color, partially offset
by growth in Mitchum anti-perspirant deodorants and American Crew
men's grooming products.
Fragrances Segment
In North America, Fragrances segment net sales of $129.0 million
in the fourth quarter of 2018 decreased by 4.2% (or 4.1% XFX)
compared to the prior-year period, primarily driven by several
expired brand licenses, as well as lower net sales due to the
segment's weakness in the mass retail channel and retail store
closures in the prestige channel.
In International, Fragrances segment net sales of $50.8 million
in the fourth quarter of 2018 decreased by 20.1% (or 17.9% XFX)
compared to the prior-year period, primarily due to several expired
brand licenses, partially offset by new product launches.
Cash Flow for the Full Year
Period
Net cash used in operating activities in 2018 was $170.8
million, compared to $139.3 million in 2017. Free cash flow(a) used
in 2018 was $228.0 million, compared to $247.6 million used in
2017. The decline in free cash flow usage was driven by lower
capital expenditures, partially offset by increased use of cash in
operating activities primarily attributed to lower net sales and
direct costs associated with remediating the SAP disruption at the
Company's Oxford, N.C. manufacturing facility as compared to the
prior-year period.
Liquidity Update
As of December 31, 2018, the Company had approximately $160.3
million of available liquidity, consisting of $87.3 million of
unrestricted cash and cash equivalents, as well as $96.4 million in
available borrowing capacity under the Revolving Credit Facility
(which had $335.0 million drawn as of such date), less float of
$23.4 million.
As of February 28, 2019, the Company had approximately $118
million of available liquidity, consisting of $75 million of
unrestricted cash and cash equivalents, as well as approximately
$50 million in available borrowing capacity under the Revolving
Credit Facility, less float of $7 million.
As previously reported in a Form 8-K filed with the SEC, on
March 6, 2019 the Company extended the maturity of its $41.5
million “first in, last out” Tranche B under its Revolving Credit
Facility through April 17, 2020.
Full Year 2018
Results
- As Reported net sales were $2,564.5
million in 2018 compared to $2,693.7 million in 2017, a 4.8%
decrease due to declines in the Revlon, Fragrances and Portfolio
segments, driven in part by approximately $64 million in net sales
reductions associated with service level disruptions at the
Company's Oxford, N.C. manufacturing facility related to the
Company's February 2018 implementation of a new SAP enterprise
resource planning system, partially offset by strong growth in the
Elizabeth Arden segment.
- As Reported operating loss was $85.2
million in 2018 compared to an operating loss of $23.8 million in
2017, driven primarily by lower net sales, costs associated with
remediating the SAP disruption at the Company's Oxford, N.C.
manufacturing facility and a $20.1 million loss, primarily
non-cash, related to reacquiring certain iconic Elizabeth Arden
trademark rights, partially offset by lower integration and
restructuring expenses, as well as lower selling, general and
administrative expenses.
- As Reported net loss was $294.2 million
in 2018 compared to a net loss of $183.2 million in 2017, with the
higher net loss driven by the higher operating loss described above
and higher interest expense, partially offset by a lower tax
provision due to the impact of the U.S. Tax Act.
- Adjusted EBITDA(a) was $237.9 million
in 2018 compared to $257.3 million in 2017, primarily driven by the
factors described above including the impact of the SAP disruption
at the Company's Oxford, N.C. manufacturing facility.
(USD millions, except per share data)
Year Ended December
31,(Unaudited)
2018 2017
AsReported
Adjusted(*)
AsReported
Adjusted(*)
AsReported
Adjusted(*)
% Change % Change Net Sales $ 2,564.5 $ 2,576.0 $ 2,693.7 $
2,693.7 (4.8 )% (4.4 )% Gross Profit 1,447.5 1,501.5 1,541.4
1,559.8 (6.1 )% (3.7 )% Gross Margin 56.4 % 58.3 % 57.2 % 57.9 %
-80bps 40bps Operating (Loss) Income $ (85.2 ) $ 43.5 $ (23.8 ) $
94.7 258.0 % (54.1 )% Adjusted EBITDA 237.9 257.3 (7.5 )% Net Loss
(294.2 ) (194.9 ) (183.2 ) (101.4 ) (60.6 )% (92.2 )% Diluted Loss
per Common Share $ (5.57 ) $ (3.69 ) $ (3.48 )
$ (1.93 ) (60.1 )% (91.2 )% (*) Refer to
footnote (a) to this Earnings Release for a discussion and
reconciliation of the Company's non-GAAP measures, including
Adjusted Net Sales, Adjusted Gross Profit, Adjusted Gross Profit
Margin, Adjusted Operating Income (Loss), Adjusted EBITDA, Adjusted
Net Income (Loss) and Adjusted Diluted Loss per Common Share.
(USD millions)
Year Ended December
31,(Unaudited)
2018As Reported 2017As Reported As Reported% Change
As ReportedXFX% Change
Total Net Sales Summary
North America $ 1,354.2 $
1,433.3 (5.5 )% (5.5 )% International
1,210.3 1,260.4 (4.0 )% (4.1 )%
Total Net Sales 2,564.5
2,693.7 (4.8 )% (4.8 )%
2018 Results
Conference Call
The Company will host a conference call with members of the
investment community today, March 18, 2019, at 5:00 P.M. EDT
to discuss its fourth quarter 2018 financial results. Access to the
call is available to the public at www.revloninc.com.
Footnotes to Press
Release
(a) Non-GAAP Financial
Measures: EBITDA; Adjusted EBITDA; Adjusted net sales;
Adjusted operating loss/income; Adjusted net income/loss; Adjusted
gross profit; Adjusted gross profit margin; Adjusted diluted loss
per common share and free cash flow (together, the “Non-GAAP
Measures”) are non-GAAP financial measures. See the reconciliations
of such Non-GAAP Measures to their most directly comparable GAAP
measures in the accompanying financial tables, to the extent not
otherwise directly reconciled in the Company’s financial
results.
The Company defines EBITDA as income from continuing operations
before interest, taxes, depreciation, amortization, gains/losses on
foreign currency fluctuations, gains/losses on the early
extinguishment of debt and miscellaneous expenses (the foregoing
being the “EBITDA Exclusions”). The Company presents Adjusted
EBITDA to exclude the EBITDA Exclusions, as well as the impact of
non-cash stock compensation expense and certain other non-operating
items that are not directly attributable to the Company's
underlying operating performance (the “Non-Operating Items”). The
following table identifies the Non-Operating Items excluded in the
presentation of Adjusted EBITDA for all periods:
(USD millions)
Income / (Loss) Adjustments to EBITDA
Q4 2018
Q4 2017
(Unaudited) Non-Operating Items: Non-cash stock compensation
expense $ 2.4 $
0.9
Restructuring and related charges 8.3 22.2 Acquisition and
integration costs 1.9 12.7 Oxford SAP disruption-related charges
4.0 — Impairment charge 18.0 10.8 Elizabeth Arden 2016 Business
Transformation program — 0.3
(USD millions)
Income / (Loss) Adjustments to EBITDA
YTD 2018
YTD 2017
(Unaudited) Non-Operating Items: Non-cash stock compensation
expense $ 17.2 $
6.8
Restructuring and related charges 23.1 34.5 Acquisition and
integration costs 13.9 52.9 Oxford SAP disruption-related charges
53.6 — Loss on disposal of minority investment 20.1 — Elizabeth
Arden inventory purchase accounting adjustment, cost of sales —
17.2 Impairment charge 18.0 10.8 Deferred compensation — 2.0
Elizabeth Arden 2016 Business Transformation program
— 1.1
Adjusted net loss and adjusted diluted loss per common share
exclude the after-tax impact of the Non-Operating Items from As
Reported net loss.
The Company excludes the EBITDA Exclusions and Non-Operating
Items, as applicable, in calculating the Non-GAAP Measures because
the Company's management believes that some of these items may not
occur in certain periods, the amounts recognized can vary
significantly from period to period and/or these items do not
facilitate an understanding of the Company's underlying operating
performance.
Free cash flow is defined as net cash provided by operating
activities, less capital expenditures for property, plant and
equipment. Free cash flow excludes proceeds on sale of discontinued
operations. Free cash flow does not represent the residual cash
flow available for discretionary expenditures, as it excludes
certain expenditures such as mandatory debt service requirements,
which for the Company are significant.
The Company's management uses the Non-GAAP Measures as operating
performance measures, and in the case of free cash flow, as a
liquidity measure (in conjunction with GAAP financial measures), as
an integral part of its reporting and planning processes and to,
among other things: (i) monitor and evaluate the performance of the
Company's business operations, financial performance and overall
liquidity; (ii) facilitate management's internal comparisons of the
Company's historical operating performance of its business
operations; (iii) facilitate management's external comparisons of
the results of its overall business to the historical operating
performance of other companies that may have different capital
structures and debt levels; (iv) review and assess the operating
performance of the Company's management team and, together with
other operational objectives, as a measure in evaluating employee
compensation, including bonuses and other incentive compensation;
(v) analyze and evaluate financial and strategic planning decisions
regarding future operating investments; and (vi) plan for and
prepare future annual operating budgets and determine appropriate
levels of operating investments.
Management believes that the Non-GAAP Measures are useful to
investors to provide them with disclosures of the Company's
operating results on the same basis as that used by management.
Management believes that the Non-GAAP Measures provide useful
information to investors about the performance of the Company's
overall business because such measures eliminate the effects of
certain charges that are not directly attributable to the Company's
underlying operating performance. Additionally, management believes
that providing the Non-GAAP Measures enhances the comparability for
investors in assessing the Company’s financial reporting.
Management believes that free cash flow is useful for investors
because it provides them with an important perspective on the cash
available for debt service and other strategic measures, after
making necessary capital investments in property and equipment to
support the Company's ongoing business operations, and provides
them with the same measures that management uses as the basis for
making resource allocation decisions.
Accordingly, the Company believes that the presentation of the
Non-GAAP Measures, when used in conjunction with GAAP financial
measures, are useful financial analytical measures that are used by
management, as described above, and therefore can assist investors
in assessing the Company's financial condition, operating
performance and underlying strength. The Non-GAAP Measures should
not be considered in isolation or as a substitute for their
respective most directly comparable As Reported financial measures
prepared in accordance with GAAP, such as net income/loss,
operating income/loss, diluted earnings/loss per share or net cash
provided by (used in) operating activities. Other companies may
define such non-GAAP measures differently. Also, while EBITDA and
Adjusted EBITDA, as used in this release, are defined differently
than Adjusted EBITDA for the Company's credit agreements and
indentures, certain financial covenants in its borrowing
arrangements are tied to similar financial measures. These non-GAAP
financial measures should be read in conjunction with the Company's
financial statements and related footnotes filed with the SEC.
(b) Segment profit is defined as income from continuing
operations for each of the Company's Revlon, Elizabeth Arden,
Portfolio and Fragrances segments, excluding the EBITDA Exclusions.
Segment profit also excludes the impact of certain items that are
not directly attributable to the segments' underlying operating
performance, including the impact of the Non-Operating Items noted
above in footnote (a). The Company does not have any material
inter-segment sales.
NOTICES TO
INVESTORS
UNAUDITED RESULTS: On March
18, 2019 Revlon filed a Form 12b-25 with the SEC, disclosing that
it would be unable to file its 2018 Form 10-K by the SEC’s
prescribed filing deadline of March 18, 2019. The filing of the
Form 12b-25 affords Revlon with an extension period to file its
2018 Form 10-K of at least until March 29, 2019. While Revlon
expects to file its 2018 Form 10-K with the SEC by such date, there
can be no assurance that it will complete the filing within such
extension period. As the audit of the 2018 Form 10-K is yet to be
finalized, the Company’s results presented herein are preliminary,
unaudited and represent the most current information available to
the Company’s management. The preliminary unaudited results
included herein have been prepared by, and are the responsibility
of, the Company’s management. KPMG LLP, the Company’s independent
registered public accounting firm, has not yet expressed an opinion
or any other form of assurance with respect to these financial
results. The Company’s actual results may differ from the
preliminary results due to the completion of the year-end financial
closing procedures, review and audit and final adjustments and
other developments that may arise between the date of this press
release and the time that the Company files its 2018 Form 10-K with
the SEC. Accordingly, all amounts in the press release are
approximates.
FORWARD-LOOKING STATEMENTS:
Statements made in this press release, which are not historical
facts, are forward-looking and are provided pursuant 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 the Company undertakes no obligation to publicly
update any forward-looking statement, whether to reflect actual
results of operations; changes in financial condition; changes in
general U.S. or international economic or industry conditions
and/or conditions in the Company’s reportable segments; changes in
estimates, expectations or assumptions; or other circumstances,
conditions, developments and/or events arising after the issuance
of this press release, except for the Company's ongoing obligations
under the U.S. federal securities laws. Forward-looking statements
are subject to known and unknown risks and uncertainties and are
based on preliminary or potentially inaccurate estimates and
assumptions that could cause actual results to differ materially
from those expected or implied by the estimated financial
information. Such forward-looking statements include, among other
things: (i) the Company belief in its continued momentum during the
fourth quarter of 2018 as it successfully executes on its core
strategies and business transformation and being particularly
encouraged by strong growth in some of the key areas that the
Company has intensely focused on such as e-commerce, Elizabeth
Arden skincare, China and Travel Retail; (ii) the Company’s belief
that as a result of improved operational performance, its achieving
strong Adjusted EBITDA growth during the second half of 2018, and
together with the recently-announced 2018 Optimization Program, it
is well positioned for long-term success; (iii) the Company’s
expectation to disclose in its 2018 Form 10-K that it identified a
material weakness in its internal control over financial reporting
as of year-end 2018, primarily related to the lack of design and
maintenance of effective controls in connection with the
previously-disclosed implementation of its enterprise resource
planning system in the U.S.; (iv) the Company’s expectation that it
will file its 2018 Form 10-K by no later than March 29, 2019,
within the 15 calendar-day extension afforded by Rule 12b-25; and
(v) the Company’s expectation that these matters will not result in
any changes to its financial results. Actual results may differ
materially from the Company's forward-looking statements for a
number of reasons, including as a result of the risks and other
items described in Revlon’s filings with the SEC, including,
without limitation, in Revlon’s Annual Report on Form 10-K,
Quarterly Reports on Form 10-Q and Current Reports on Form 8-K and
any amendments thereto filed with the SEC during 2018 and 2019
(which may be viewed on the SEC’s website at http://www.sec.gov or
on Revlon, Inc.’s website at http://www.revloninc.com). Additional
important factors that could cause actual results to differ
materially from those indicated by the Company’s forward-looking
statements include risks, unanticipated circumstances and/or
uncertainties relating to: (i) less than expected results from the
Company’s core strategies and business transformation and/or
unanticipated circumstances or results that may adversely affect
the Company's financial performance and growth, such as due to less
than effective new product innovation and development and/or
greater than expected investments or unanticipated costs to achieve
such initiatives, as well as difficulties with, delays in or the
Company’s inability to successfully complete the actions underlying
the 2018 Optimization Program, in whole or in part, which could
result in less than expected operating and financial benefits from
such actions, such as difficulties with, delays in or the Company’s
inability to generate reductions in its cost base and/or overhead
costs, higher than anticipated restructuring charges and/or
payments and/or changes in the expected timing of such charges
and/or payments, delays in completing the actions underlying the
2018 Optimization Program, which could reduce and/or defer the
benefits expected to be realized from such activities, less than
anticipated annualized cost reductions from the 2018 Optimization
Program and/or changes in the timing of realizing such cost
reductions, such as due to less than anticipated resources to fund
such activities and/or more than expected costs to achieve the
expected cost reductions; (ii) unanticipated circumstances or
developments that could affect the Company’s long-term success,
including, among other factors, the following: greater than
anticipated declines in the brick-and-mortar retail channel or
those conditions occurring at a rate faster than anticipated; the
Company’s inability to address the pace and impact of the new
commercial landscape, such as its inability to further enhance its
e-commerce and social media capabilities and/or increase its
penetration of e-commerce and social media channels; difficulties,
delays and/or the Company's inability to (in whole or in part)
develop and implement effective content to enhance its online
retail position, improve its consumer engagement across social
media platforms and/or transform its technology and data to support
efficient management of its digital infrastructure; the Company
incurring greater than anticipated levels of expenses and/or debt
to facilitate the foregoing objectives, which could result in,
among other things, less than anticipated revenues and/or
profitability; decreased consumer spending in response to weak
economic conditions or weakness in the consumption of beauty
products in one or more of the Company's segments; adverse changes
in tariffs, foreign currency exchange rates, foreign currency
controls and/or government-mandated pricing controls; decreased
performance by third-party suppliers, whether due to shortages of
raw materials or otherwise, and/or supply disruptions at the
Company’s manufacturing facilities; changes in consumer
preferences, such as reduced consumer demand for the Company's
color cosmetics and other current products, including new product
launches; changes in consumer purchasing habits, including with
respect to retailer preferences and/or among sales channels, such
as due to the continuing consumption declines in core beauty
categories in the mass retail channel in North America; lower than
expected customer acceptance or consumer acceptance of, or less
than anticipated results from, the Company’s existing or new
products; higher than expected retail store closures in the
brick-and-mortar channels where the Company sells its products, as
consumers continue to shift purchases to online and e-commerce
channels; higher than expected restructuring costs, severance
costs, permanent display costs and/or capital expenditures,
including, without limitation, costs and expenses related to the
2018 Optimization Program; higher than expected pension expense
and/or cash contributions under its benefit plans, costs related to
litigation, advertising, promotional and/or marketing expenses or
lower than expected results from the Company’s advertising,
promotional, pricing and/or marketing plans; higher than expected
sales returns related to any reduction of space by the Company's
customers, product discontinuances or otherwise or decreased sales
of the Company’s existing or new products; actions by the Company’s
customers, such as greater than expected inventory management
and/or de-stocking, and greater than anticipated space
reconfigurations or reductions in display space and/or product
discontinuances or a greater than expected impact from pricing,
marketing, advertising and/or promotional strategies by the
Company's customers; and/or decreased sales of the Company's
products as a result of changes in the competitive environment and
increased competitive activities by the Company's competitors,
including, among other things, business combinations, technological
breakthroughs, implementation of new pricing strategies, new
product offerings, increased advertising, promotional and marketing
spending and advertising, promotional and/or marketing successes by
competitors; (iii) unexpected developments as the audit of the
Company’s internal control over financial reporting is completed
prior to filing its 2018 Form 10-K, such as the unexpected
identification of other additional areas of material weakness in
the Company’s internal control over financial reporting as the
audit procedures are completed; (iv) unexpected difficulties and/or
delays in filing the Company’s 2018 Form 10-K by no later than
March 29, 2019; and/or (v) unexpected impacts on the Company’s
financial results as the fiscal year 2018 audit procedures are
completed. Factors other than those referred to above could also
cause Revlon’s results to differ materially from expected results.
Additionally, the business and financial materials and any other
statement or disclosure on, or made available through, Revlon’s
website or other websites referenced herein shall not be
incorporated by reference into this press release.
REVLON, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF
OPERATIONS AND COMPREHENSIVE LOSS (dollars in millions,
except share and per share amounts)
Three Months EndedDecember
31,
Year EndedDecember 31,
2018 2017 2018 2017
(Unaudited) (Unaudited) Net sales $ 741.6 $
786.6 $ 2,564.5 $ 2,693.7 Cost of sales 309.8 327.9
1,117.0 1,152.3 Gross profit 431.8 458.7
1,447.5 1,541.4 Selling, general and administrative expenses 373.4
393.6 1,460.5 1,468.1 Acquisition and integration costs 1.9 12.7
13.9 52.9 Restructuring charges and other, net 6.3 22.1 20.2 33.4
Impairment charge 18.0 10.8 18.0 10.8 Loss on disposal of minority
investment — — 20.1 — Operating income
(loss) 32.2 19.5 (85.2 ) (23.8 ) Other
expenses: Interest expense 47.5 39.5 176.6 149.8 Amortization of
debt issuance costs 3.9 2.3 13.0 9.1 Foreign currency losses
(gains), net 5.1 (1.7 ) 15.8 (18.5 ) Miscellaneous, net 0.7
(2.5 ) 1.3 (0.7 ) Other expenses 57.2 37.6
206.7 139.7 Loss from continuing operations
before income taxes (25.0 ) (18.1 ) (291.9 ) (163.5 ) Provision for
income taxes 45.3 59.6 2.2 21.8 Loss
from continuing operations, net of taxes (70.3 ) (77.7 ) (294.1 )
(185.3 ) Income (loss) from discontinued operations, net of taxes —
0.8 (0.1 ) 2.1 Net loss $ (70.3 ) $ (76.9 ) $
(294.2 ) $ (183.2 ) Other comprehensive (loss) income:
Foreign currency translation adjustments, net of tax 2.9 3.7 (9.4 )
9.0 Amortization of pension related costs, net of tax 1.9 2.0 8.4
8.1 Pension re-measurement, net of tax (5.5 ) 1.8 (5.5 ) 1.8
Pension curtailment, net of tax — (0.5 ) — 2.1 Reclassification
into earnings of accumulated losses from the de-designated 2013
Interest Rate Swap, net of tax — 0.5 0.7 2.3
Other comprehensive (loss) income, net (0.7 ) 7.5
(5.8 ) 23.3 Total comprehensive loss $ (71.0 ) $ (69.4 ) $
(300.0 ) $ (159.9 ) Basic (loss) earnings per common share:
Continuing operations $ (1.33 ) $ (1.48 ) $ (5.57 ) $ (3.52 )
Discontinued operations — 0.02 — 0.04
Net loss $ (1.33 ) $ (1.46 ) $ (5.57 ) $ (3.48 ) Diluted
(loss) earnings per common share: Continuing operations $ (1.33 ) $
(1.48 ) $ (5.57 ) $ (3.52 ) Discontinued operations — 0.02
— 0.04 Net loss $ (1.33 ) $ (1.46 ) $ (5.57 )
$ (3.48 ) Weighted average number of common shares
outstanding: Basic 52,856,448 52,635,051 52,797,686
52,597,582 Diluted 52,856,448 52,635,051
52,797,686 52,597,582
REVLON, INC.
AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS
(dollars in millions) December 31,
December 31, 2018 2017 (Unaudited)
ASSETS Current assets: Cash and cash equivalents $
87.3 $ 87.1 Trade receivables, net 431.3 444.8 Inventories 523.2
497.9 Prepaid expenses and other current assets 152.0 113.4
Total current assets 1,193.8 1,143.2 Property, plant and
equipment, net 354.5 372.7 Deferred income taxes 131.8 138.0
Goodwill 673.9 692.5 Intangible assets, net 532.0 592.1 Other
assets 130.8 118.4 Total assets $ 3,016.8 $
3,056.9
LIABILITIES AND STOCKHOLDERS'
DEFICIENCY Current liabilities: Short-term borrowings $ 9.3 $
12.4 Current portion of long-term debt 348.1 170.2 Accounts payable
332.1 336.9 Accrued expenses and other current liabilities 430.9
412.8 Total current liabilities 1,120.4 932.3
Long-term debt 2,727.7 2,653.7 Long-term pension and other
post-retirement plan liabilities 169.0 172.8 Other long-term
liabilities 56.5 68.5 Total stockholders' deficiency (1,056.8 )
(770.4 ) Total liabilities and stockholders' deficiency $ 3,016.8
$ 3,056.9
REVLON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (dollars in
millions) Year Ended December 31,
2018 2017 (Unaudited) CASH
FLOWS FROM OPERATING ACTIVITIES: Net loss $ (294.2 ) $
(183.2 ) Adjustments to reconcile net loss to net cash used
in operating activities: Depreciation and amortization 177.2 155.8
Foreign currency losses (gains) from re-measurement 15.8 (22.5 )
Amortization of debt discount 1.4 1.2 Stock-based compensation
amortization 17.2 6.8 Impairment charge 18.0 10.8 Provision for
deferred income taxes 1.7 22.6 Amortization of debt issuance costs
13.0 9.1 Non-cash loss on disposal of minority investment 18.6 —
Loss on sale of certain assets 0.8 1.6 Pension and other
post-retirement cost 2.6 1.5 Change in assets and liabilities:
Increase in trade receivables (0.3 ) (9.9 ) Increase in inventories
(36.4 ) (63.0 ) Increase in prepaid expenses and other current
assets (42.8 ) (21.2 ) Increase in accounts payable 1.6 26.8
Increase in accrued expenses and other current liabilities 23.9
12.3 Pension and other post-retirement plan contributions (8.8 )
(8.5 ) Purchases of permanent displays (80.7 ) (65.5 ) Other, net
0.6 (14.0 ) Net cash used in operating activities (170.8 )
(139.3 )
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (57.2 ) (108.3 ) Net cash used in investing
activities (57.2 ) (108.3 )
CASH FLOWS FROM FINANCING
ACTIVITIES: Net (decrease) increase in short-term borrowings
and overdraft (1.1 ) 3.3 Net borrowings under the 2016 Revolving
Credit Facility 178.0 157.0 Net borrowings under the 2018 Foreign
Asset-Based Term Loan 88.9 — Repayments under the 2016 Term Loan
Facility (18.0 ) (18.0 ) Payment of financing costs (9.7 ) (1.2 )
Tax withholdings related to net share settlements of restricted
stock units and awards (3.6 ) (2.5 ) Other financing activities
(1.4 ) (1.7 ) Net cash provided by financing activities 233.1
136.9 Effect of exchange rate changes on cash, cash
equivalents and restricted cash (5.0 ) 11.3 Net increase
(decrease) in cash, cash equivalents and restricted cash 0.1 (99.4
) Cash, cash equivalents and restricted cash at beginning of period
87.4 186.8 Cash, cash equivalents and restricted cash
at end of period $ 87.5 $ 87.4
Supplemental schedule of cash flow information: Cash paid during
the period for: Interest $ 163.7 $ 149.1 Income taxes, net of
refunds 16.0 0.4
REVLON, INC. AND SUBSIDIARIES
EBITDA AND ADJUSTED EBITDA RECONCILIATION (dollars in
millions)
Three Months EndedDecember
31,
2018 2017 (Unaudited)
Reconciliation to net loss: Net loss $ (70.3 )
$ (76.9 ) (Loss) income from discontinued operations, net of
taxes — 0.8 Loss from continuing operations, net of
taxes (70.3 ) (77.7 ) Interest expense 47.5 39.5
Amortization of debt issuance costs 3.9 2.3 Foreign currency losses
(gains), net 5.1 (1.7 ) Provision for income taxes 45.3 59.6
Depreciation and amortization 57.8 44.1 Miscellaneous, net 0.7
(2.5 ) EBITDA $ 90.0 $ 63.6
Non-operating items: Non-cash stock compensation
expense 2.4 0.9 Restructuring and related charges 8.3 22.2
Acquisition and integration costs 1.9 12.7 Oxford SAP
disruption-related charges 4.0 — Impairment charge 18.0 10.8
Elizabeth Arden 2016 Business Transformation program — 0.3
Adjusted EBITDA $ 124.6 $ 110.5
Year EndedDecember 31,
2018 2017 (Unaudited) Reconciliation
to net loss: Net loss $ (294.2 ) $ (183.2 ) (Loss)
income from discontinued operations, net of taxes (0.1 ) 2.1
Loss from continuing operations, net of taxes (294.1 ) (185.3 )
Interest expense 176.6 149.8 Amortization of debt issuance
costs 13.0 9.1 Foreign currency losses (gains), net 15.8 (18.5 )
Provision for income taxes 2.2 21.8 Depreciation and amortization
177.2 155.8 Miscellaneous, net 1.3 (0.7 ) EBITDA $
92.0 $ 132.0 Non-operating
items: Non-cash stock compensation expense 17.2 6.8 Restructuring
and related charges 23.1 34.5 Acquisition and integration costs
13.9 52.9 Oxford SAP disruption-related charges 53.6 — Impairment
charge 18.0 10.8 Loss on disposal of minority investment 20.1 —
Elizabeth Arden inventory purchase accounting adjustment, cost of
sales — 17.2 Deferred compensation — 2.0 Elizabeth Arden 2016
Business Transformation program — 1.1 Adjusted
EBITDA $ 237.9 $ 257.3
REVLON, INC. AND SUBSIDIARIES SEGMENT PROFIT, ADJUSTED
EBITDA AND ADJUSTED OPERATING LOSS RECONCILIATION (dollars
in millions)
Three Months EndedDecember
31,
2018 2017 (Unaudited) Segment Net
Sales: Revlon $ 261.4 $ 301.5 Elizabeth Arden
156.3 132.2 Portfolio 144.1 154.6 Fragrances 179.8 198.3
Total Segment Net Sales $ 741.6
$ 786.6 Segment
Profit: Revlon $ 54.0 $ 82.0 Elizabeth Arden 22.1 4.6 Portfolio
13.7 0.4 Fragrances 34.8 23.5
Total Segment
Profit/Adjusted EBITDA $ 124.6
$ 110.5 Reconciliation to
loss from continuing operations before income taxes: Loss from
continuing operations before income taxes $ (25.0 ) $ (18.1 )
Interest expense 47.5 39.5 Amortization of debt issuance
costs 3.9 2.3 Foreign currency losses (gains), net 5.1 (1.7 )
Miscellaneous, net 0.7 (2.5 ) Operating income 32.2 19.5
Non-operating items: Restructuring and related charges 8.3
22.2 Acquisition and integration costs 1.9 12.7 Oxford SAP
disruption-related charges 4.0 — Impairment charge 18.0 10.8
Elizabeth Arden 2016 Business Transformation program — 0.3
Adjusted Operating income 64.4 65.5 Non-cash stock
compensation expense 2.4 0.9 Depreciation and amortization 57.8
44.1 Adjusted EBITDA $ 124.6 $
110.5
REVLON, INC. AND SUBSIDIARIES SEGMENT
PROFIT, ADJUSTED EBITDA AND ADJUSTED OPERATING LOSS
RECONCILIATION (dollars in millions)
Year EndedDecember 31,
2018 2017 (Unaudited) Segment Net
Sales: Revlon $ 998.3 $ 1,089.3 Elizabeth Arden
490.2 433.8 Portfolio 564.6 592.5 Fragrances 511.4 578.1
Total Segment Net Sales $
2,564.5 $ 2,693.7
Segment Profit: Revlon $ 129.6 $ 180.1 Elizabeth Arden 24.4
6.9 Portfolio 7.9 8.1 Fragrances 76.0 62.2
Total Segment Profit/Adjusted EBITDA $
237.9 $ 257.3
Reconciliation to loss from continuing operations before income
taxes: Loss from continuing operations before income taxes $
(291.9 ) $ (163.5 ) Interest expense 176.6 149.8
Amortization of debt issuance costs 13.0 9.1 Foreign currency
losses (gains), net 15.8 (18.5 ) Miscellaneous, net 1.3 (0.7
) Operating loss (85.2 ) (23.8 ) Non-operating items:
Restructuring and related charges 23.1 34.5 Acquisition and
integration costs 13.9 52.9 Oxford SAP disruption-related charges
53.6 — Loss on disposal of minority investment 20.1 — Elizabeth
Arden inventory purchase accounting adjustment, cost of sales —
17.2 Impairment charge 18.0 10.8 Deferred compensation — 2.0
Elizabeth Arden 2016 Business Transformation program — 1.1
Adjusted Operating income 43.5 94.7 Non-cash stock
compensation expense 17.2 6.8 Depreciation and amortization 177.2
155.8 Adjusted EBITDA $ 237.9 $
257.3
REVLON, INC. AND SUBSIDIARIES
ADJUSTED NET SALES RECONCILIATION (dollars in
millions) Three Months Ended December
31, 2018 2017 (Unaudited) Net Sales
$ 741.6 $
786.6
Non-operating items: Oxford SAP disruption-related charges
1.4 — Adjusted Net Sales $ 743.0
$ 786.6
Year Ended
December 31, 2018 2017 (Unaudited)
Net Sales $ 2,564.5 $ 2,693.7 Non-operating items:
Oxford SAP disruption-related charges 11.5 —
Adjusted Net Sales $ 2,576.0 $
2,693.7
REVLON, INC. AND SUBSIDIARIES
ADJUSTED GROSS PROFIT RECONCILIATION (dollars in
millions)
Three Months EndedDecember
31,
2018 2017 (Unaudited) Gross Profit $
431.8 $
458.7
Non-operating items: Restructuring and related charges — 0.4
Oxford SAP disruption-related charges 4.0 — Adjusted
Gross Profit $ 435.8 $ 459.1
Year EndedDecember 31,
2018 2017 (Unaudited) Gross Profit $
1,447.5 $ 1,541.4 Non-operating items: Restructuring and
related charges 0.4 0.9 Oxford SAP disruption-related charges 53.6
— Elizabeth Arden inventory purchase accounting adjustment, cost of
sales — 17.2 Elizabeth Arden 2016 Business Transformation program —
0.3 Adjusted Gross Profit $ 1,501.5
$ 1,559.8
REVLON, INC. AND
SUBSIDIARIES ADJUSTED NET LOSS AND ADJUSTED DILUTED LOSS PER
SHARE RECONCILIATION (dollars in millions, except share and
per share amounts)
Three Months EndedDecember
31,
2018 2017 (Unaudited) Reconciliation
to net loss and diluted loss per share: Net loss $
(70.3 ) $ (76.9 ) Non-operating items
(after-tax): Restructuring and related charges 6.6 15.5 Acquisition
and integration costs 1.3 8.6 Oxford SAP disruption-related charges
3.1 — Impairment charge 13.6 7.4 Elizabeth Arden 2016 Business
Transformation program — 0.2 Adjusted net
income (loss) $ (45.7 ) $ (45.2 )
Net income (loss): Diluted loss per common share (1.33 )
(1.46 ) Adjustment to diluted loss per common share 0.47
0.60 Adjusted diluted earnings (loss) per common
share $ (0.86 ) $ (0.86 ) U.S.
GAAP weighted average number of common shares outstanding: Diluted
52,856,448 52,635,051
Year EndedDecember 31,
2018 2017 (Unaudited) Reconciliation
to net loss and diluted loss per share: Net loss $ (294.2 ) $
(183.2 ) Non-operating items (after-tax): Restructuring and
related charges 18.8 24.8 Acquisition and integration costs 10.7
34.2 Oxford SAP disruption-related charges 40.7 — Loss on disposal
of minority investment 15.5 — Elizabeth Arden inventory purchase
accounting adjustment, cost of sales — 12.7 Impairment charge 13.6
7.4 Deferred compensation — 2.0 Elizabeth Arden 2016 Business
Transformation program — 0.7 Adjusted net loss
$ (194.9 ) $ (101.4 ) Net (loss)
income: Diluted loss per common share (5.57 ) (3.48 ) Adjustment to
diluted loss per common share 1.88 1.55 Adjusted
diluted (loss) earnings per common share $ (3.69 ) $
(1.93 ) U.S. GAAP weighted average number of
common shares outstanding: Diluted 52,797,686 52,597,582
REVLON, INC. AND SUBSIDIARIES FREE CASH
FLOW RECONCILIATION (dollars in millions)
Year EndedDecember 31,
2018 2017 (Unaudited) Reconciliation
to net cash used in operating activities: Net cash used
in operating activities $ (170.8 ) $
(139.3 ) Less capital expenditures (57.2 ) (108.3 )
Free cash flow $ (228.0 ) $
(247.6 )
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190318005754/en/
Investor Relations:212-527-5230 or
Eric.warren@revlon.com
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