Revlon (REV) Reports Q3 Loss of $0.71, Revenues Miss

Revlon (NYSE: REV) reported Q3 EPS of ($0.71), versus $0.14 reported last year. Revenue for the quarter came in at $596.8 million versus the consensus estimate of $641.9 million.

Quarter ended September 30, 2019 summary developments:1

• As Reported net sales were $596.8 million in the third quarter of 2019, compared to $655.4 million during the prior-year period, a decline of 8.9%. On a constant currency basis, net sales decreased 7.1% driven primarily by net sales declines in the Portfolio and Revlon segments, partially offset by net sales growth in the Elizabeth Arden segment. Revlon segment net sales declines were primarily driven by retailers reducing inventory and overall category declines.
• As Reported operating income improved to $16.7 million in the third quarter of 2019, compared to $2.3 million during the prior-year period. The higher operating income was driven primarily by cost reductions related to the Company's cost optimization initiatives and improved gross profit margin.
• As Reported net loss increased to $44.7 million in the third quarter of 2019 versus a $11.1 million net loss in the prior-year period. The higher net loss was driven primarily by a $36.6 million decrease in the benefit from income taxes due in part to a one-time, non-cash true-up associated with U.S. 2017 Tax Act in the prior-year period and higher interest expense, partially offset by the higher operating income described above.
• Adjusted EBITDA(a) in the third quarter of 2019 was $68.4 million which included the impact of $3.7 million of tariffs and $2.0 million of negative foreign exchange. Excluding these items, Adjusted EBITDA would have increased $1.7 million or approximately 2% versus the prior-year period's Adjusted EBITDA of $72.4 million.

"While we were disappointed with the negative results in the North America business, we remain pleased with the momentum and strong growth we are achieving in Elizabeth Arden and the expansion of our businesses in China, travel retail and e-commerce. The Revlon brand continued to be impacted by overall category declines as well as customer inventory reductions and the planned management of trade inventory levels. Despite top-line softness, we saw growth in profitability across three of our four segments, as well as improved cash flow usage resulting from our cost optimization program which remains on track to deliver the previously-announced cost reductions," said Debra Perelman, President and CEO of Revlon.

For earnings history and earnings-related data on Revlon (REV) click here.

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