Revlon, a magnificence icon in a crowded market, declares chapter

Revlon, a cosmetics producer that has damaged racial obstacles and set magnificence traits for a lot of the final century, has filed for Chapter 11 chapter safety.

The corporate has been a mainstay of retailer cabinets since its founding 90 years in the past in New York Metropolis, overseeing a secure of family names, from Almay to Elizabeth Arden.

However Revlon could not sustain with altering tastes, gradual to observe girls as they swapped flashy purple lipstick for extra muted tones within the ’90s.

Along with shedding market share to huge rivals like Procter & Gamble, Kylie Jenner’s and different celebs’ new cosmetics strains have efficiently capitalized on the large social media following of well-known faces who showcased the merchandise.

Revlon CEO Debra Perelman, the corporate’s first feminine CEO in its 89-year historical past, confirmed the merchandise throughout an interview on Wednesday, August 18, 2021 in New York. (AP Picture / Bebeto Matthews, File)

Already weighed down by rising debt, Revlon’s woes solely escalated with the pandemic as lipstick gave method to a brand new trend period, this one with medical-grade masks.

Gross sales fell 21% in 2020, the primary 12 months of the pandemic, though they rebounded 9.2% within the firm’s final reporting 12 months with the unfold of vaccines.

Within the closing quarter ending March, Revlon’s gross sales elevated practically 8%, however are nonetheless lagging behind pre-pandemic ranges of over $ 2.4 billion a 12 months.

The disruptions within the international provide chain which have been limping a whole lot of worldwide corporations in latest months have been an excessive amount of for Revlon, which barely escaped chapter in late 2020 by convincing bondholders to increase its maturing debt.

There could also be additional company restructuring within the shopper merchandise sector within the face of the specter of a recession and rising prices of borrowing cash.

Revlon mentioned Thursday that, topic to courtroom approval, it plans to obtain $ 575 million in funding from its present lenders, which can enable it to maintain its day-to-day operations working.

“Immediately’s submitting will allow Revlon to supply our shoppers the enduring merchandise we’ve offered for many years, whereas offering a clearer path for our future progress,” mentioned Debra Perelman, appointed president and CEO of Revlon in 2018.

His father, billionaire Ron Perelman, helps the corporate by way of MacAndrews & Forbes, which acquired the enterprise by way of a hostile takeover in 1985. Revlon went public in 1996.

Perelman mentioned demand for its merchandise stays sturdy, however its “difficult capital construction” provided restricted delivery capability.

Throughout its heyday within the twentieth century, Revlon solely adopted Avon in gross sales. It now holds the twenty second spot amongst cosmetics producers, in response to a latest rating from trend journal WWD.

Revlon turned the primary magnificence firm to function a black mannequin in 1970, Naomi Sims.

Within the Nineteen Eighties, the corporate energized the cosmetics trade by highlighting each well-known and undiscovered fashions similar to Iman, Claudia Schiffer, Cindy Crawford and Christy Turlington, promising to make all girls “unforgettable”.

Perelman, in an interview with The Related Press final 12 months earlier than international provide chains crashed, mentioned he was optimistic concerning the future.

The corporate doubled down throughout the pandemic to get extra on-line with providers like digital one-on-one counseling by way of its Elizabeth Arden line, she mentioned.

Perelman additionally mentioned the corporate was studying from movie star launches to be extra agile and that Revlon had regained market share.

None of Revlon’s worldwide working subsidiaries are included within the continuing, aside from Canada and the UK.

The submitting was filed with the USA Chapter Courtroom for the Southern District of New York.

The corporate has listed belongings and liabilities ranging between $ 1 billion and $ 10 billion, in response to its chapter submitting.

By Anna D’innocenzio

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