Revlon files bankruptcy

2022 - 6 - 16

Revlon Revlon

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Image courtesy of "CNBC"

Cosmetics giant Revlon files for Chapter 11 bankruptcy protection (CNBC)

Revlon filed for Chapter 11 bankruptcy protection on Wednesday evening as it grappled with a cumbersome debt load and a snarled supply chain.

In late 2020, as stuck-at-home consumers dramatically curtailed their spending on beauty items, Revlon narrowly avoided bankruptcy when enough bondholders took part in its debt restructuring program. Revlon had long-term debt of $3.31 billion as of March 31, a securities filing shows. Now, however, as inflation rages, interest rates rise and consumers begin to pull back spending on discretionary items, experts predict more retail companies will be pressured to restructure. More than three dozen retailers filed for bankruptcy in 2020, marking an 11-year high, which experts say was an extensive and Covid pandemic-driven pull-forward of restructuring activity. Through May 31, S&P Global Market Intelligence tracked 143 bankruptcies, across all industries, so far this year, which is the slowest pace since at least 2010. Shipping components from China to the United States takes Revlon eight to 12 weeks and costs four times 2019 prices, it said.

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Image courtesy of "CNN"

Revlon files for bankruptcy (CNN)

Revlon, the 90-year-old cosmetics giant, filed for Chapter 11 bankruptcy protection because of its crippling debt and mounting celebrity competition.

Revlon's sales lagged over the years and in 2021 fell 22% from its 2017 levels. She added that its "challenging capital structure has limited our ability to navigate macro-economic issues in order to meet this demand." Revlon is receiving $575 million in debtor-in-possession financing to help support its day-to-day operations.

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Revlon files for bankruptcy after supply chain woes and competition ... (Financial Times)

US cosmetics group majority-owned by billionaire Ron Perelman vows to 'unlock the full potential' of its brands after debt overhaul.

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Image courtesy of "CBC.ca"

Revlon files for Chapter 11 bankruptcy protection in U.S. | CBC News (CBC.ca)

Revlon, the 90-year-old multinational beauty company, has filed for Chapter 11 bankruptcy, weighed down by a heavy debt load, disruptions to its supply ...

Perelman also said that the company was learning from celebrity launches like Kylie to be more nimble. The beauty company said in March that logistical issues hurt its ability to meet customer orders. The company hit many milestones in its heyday. The company avoided bankruptcy in late 2020 by persuading enough bondholders to extend its maturing debt. During an interview with The Associate Press last fall, Perelman said she was optimistic about the future. Revlon also faced increasing competition not only from the likes of Procter & Gamble, but most recently from celebrity lines like Kylie Jenner-backed Kylie, which don't have to invest a lot in marketing because of their massive social media following.

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Revlon files for bankruptcy amid competition and supply chain stress (NPR)

The international beauty company, which sells products in more than 150 countries, has struggled with heavy debt. It listed $3.7 billion in total debts in a ...

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Image courtesy of "CTV News"

Revlon, beauty icon in crowded market, files for bankruptcy (CTV News)

Revlon, the 90-year-old multinational beauty company, has filed for Chapter 11 bankruptcy protection, weighed down by debt load, disruptions to its supply ...

Perelman also said that the company was learning from celebrity launches like Kylie to be more nimble. Amid soaring inflation and the Bank of Canada increasing interest rates more aggressively relative to past tightening cycles, concerns about a possible recession are growing. It now holds the 22nd spot among cosmetics makers, according to a recent ranking by fashion trade journal WWD. In the latest quarter that ended in March, sales rose nearly 8 per cent. And in addition to rivals like Procter & Gamble, it faced increased competition from celebrity cosmetics lines like Kylie Jenner's Kylie, which capitalized on their massive social media following. With household names like Almay to Elizabeth Arden, Revlon has been a mainstay on store shelves for decades.

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Image courtesy of "The New York Times"

Revlon Files for Bankruptcy (The New York Times)

Revlon built a cosmetics empire on red nail polish, with lipstick to match. But the pioneering brand, a mainstay of cosmetic cabinets since the Great ...

High inflation, rising interest rates and warnings of a recession have made shoppers more wary of opening their wallets. The social media superstars have promoted their products directly to their millions of Instagram followers, embracing inclusive color palettes and sidestepping the drugstores Revlon has traditionally relied on to sell its products. But the pioneering brand, a mainstay of cosmetic cabinets since the Great Depression, has lost its shine, amid the rise of a new generation of cosmetic brands, changing shopping habits and supply chain snarls. The company’s stretched balance sheet “has limited our ability to navigate macroeconomic issues in order to meet this demand,” she said. Managing its debt load has also created problems beyond the company. The company has about 5,700 employees.

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Revlon Files Bankruptcy as Supply-Side Woes Prove Breaking Point (Bloomberg)

Revlon Inc. filed for Chapter 11 bankruptcy as the global supply chain crunch proved the tipping point for the debt-laden company that has struggled to tap ...

Revlon Inc. filed for Chapter 11 bankruptcy as the global supply chain crunch proved the tipping point for the debt-laden company that has struggled to tap into a broader cosmetics sales boom driven by social-media influencers.

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Image courtesy of "The Washington Post"

Revlon files for Chapter 11 bankruptcy protection (The Washington Post)

The cosmetics giant is attempting to get out from under its heavy debt load amid soaring prices and a snarled supply chain.

Shipping from China to the United States doubled in time and quadrupled in cost compared with 2019, the company said. Revlon said it’s unable to keep a regular supply of raw materials, putting production at risk, according to the court filing. In May, inflation reached 8.6 percent over the last year, which led to financial pressure felt by many households. “If executed effectively, Revlon could emerge from bankruptcy with a cleaner balance sheet and a better operating profile, improving longer term business prospects,” David Silverman, retail senior director at Fitch Ratings, told RetailDive in email comments. Among the 143 bankruptcies, only three are retail filings. In March 2020, Revlon cut 1,000 positions to improve profitability.

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Revlon files for bankruptcy as online beauty contest takes toll (Reuters)

Revlon Inc has filed for bankruptcy after the U.S cosmetics firm buckled under debts it built up in efforts to compete with online-focused upstarts.

But the company's sales lagged over the years and in 2021 fell 22% from its 2017 levels. Resulting product shortages were another major factor in tipping it into bankruptcy and analysts have said they were unlikely to be resolved in the near-term. Register now for FREE unlimited access to Reuters.com

Revlon files for bankruptcy, blames supply chain snags (Financial Post)

Cosmetics maker Revlon Inc has filed for bankruptcy, falling victim to global supply chain disruptions that pushed up raw material costs and prompted ...

Revlon plans to fund its bankruptcy case with $575 million in debtor-in-possession financing from its existing lender base. A quick prompt resolution of the dispute would help its bankruptcy case move forward, it said in court papers. In contrast, competitors like CoverGirl, owned by Coty Inc, have gained market share by investing heavily to improve supplies. It was sold in 1985 to MacAndrews & Forbes – which remains the controlling shareholder and is owned by Ron Perelman – and went public 11 years later. At the same time, vendors that traditionally offered up to 75 days for payment began demanding cash in advance of new orders, while labor shortages and inflation added to its troubles, it said. Article content

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Image courtesy of "Los Angeles Times"

Cosmetics company Revlon files for bankruptcy protection (Los Angeles Times)

Revlon is filing for Chapter 11 bankruptcy protection, weighed down by debt load, global supply chain disruptions and surging costs.

Perelman also said that the company was learning from celebrity launches such as Kylie to be more nimble. In the latest quarter that ended in March, sales rose nearly 8%. The company avoided bankruptcy in late 2020 by persuading enough bondholders to extend its maturing debt. During an interview with the Associate Press last fall, Perelman said she was optimistic about the future. In the 1980s, Revlon made a big splash with its supermodel campaign featuring diverse, famous and new models, including Iman, Schiffer, Crawford and Turlington, when it promised to make women “unforgettable.” It now holds the 22nd spot among cosmetics makers, according to a recent ranking by fashion trade journal WWD. The New York City company was slow to follow most women who gave up flashy cosmetics such as red lipstick for more muted tones starting in the 1990s.

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Image courtesy of "Drug Store News"

Revlon files for bankruptcy (Drug Store News)

Revlon stated that by filing for Chapter 11 it will be able to operate seamlessly in all markets and focus on driving future growth.

“By addressing these complex legacy debt constraints, we expect to be able to simplify our capital structure and significantly reduce our debt, enabling us to unlock the full potential of our globally recognized brands,” Perelman said. “Consumer demand for our products remains strong – people love our brands, and we continue to have a healthy market position. “Today’s filing will allow Revlon to offer our consumers the iconic products we have delivered for decades, while providing a clearer path for our future growth,” said Debra Perelman, Revlon's president and chief executive officer.

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