MacAndrews and Forbes, headed by billionaire investor Ronald Perleman, originally took out a $1.8bn stake in Revlon and absorbed $900m in costs back in 1985. But since MacAndrews and Forbes took out its first stake in the company profits have remained limited, despite repeated cash injections from the financiers and repeated boardroom shuffles. The latest loan was confirmed last week, when MacAndrews and Forbes agreed to provide Revlon with a further $170m loan to Revlon's operating subsidiary, giving it a 57 percent majority shareholding in the business. The refinancing is basically being used by Revlon as a means of streamlining its current debts. Revlon says the proceeds from the new loan will repay $167.4m on another loan, allowing it to trim back interest payments that are currently running at $135m a year. The cosmetics giant recently outlined its road map for the future, after announcing much lower losses for its third quarter, thanks to the reduced impact of losses attributed to the company's discontinued Vital Radiance range, which was first axed at the end of 2005. For the third quarter the company posted a loss of $10.4m, compared to a loss of $100.5m for the corresponding quarter in the previous year, which certainly puts the company in a rosier position compared to last year. Costs aside, the company is expecting to hit just over $200m in profits this year, but this figure will continue to be significantly impacted by the debt repayments. Bearing all of this in mind, Revlon is clearly under pressure from both ends. There is pressure to pin back the current debts in an effort to become more profitable, and, likewise, there is the pressure to continue to improve the performance in an effort to repay shareholders. In order to remedy the situation and put Revlon back on the path to profitability the company is launching an extensive new product line-up in 2008 for its Revlon and Almay color cosmetics brands. Among the ranges hitting shelves in the first half of next year is ColorStay Minerals, a line including a blusher, foundation, bronzer and eye shadow that Revlon claims will be the first-ever long-wearing mineral collection on the mass market.
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