Revlon replaces CEO and records first quarter profit
The US-based color cosmetics company suffered a slight drop in sales for the quarter ending March 31 2009, but net income was up significantly on last year’s figures.
Sales dropped from $311.7m to $303.3m, but the company said figures suffered from unfavorable currency fluctuations. Discounting this effect, net sales increased by 3.8 percent.
A good performance from Revlon and Almay color cosmetics fed by strong new launches was dampened by a weaker performance from the Mitchum anti-perspirant deodorant brand. Fragrance sales also suffered, according to Revlon.
Revlon moves into profit
Lower interest expenses and lower income tax expenses helped bring net income into the black to reach $12.7m compared to a loss of $2.4m in the same quarter last year.
Commenting on the results CEO David Kennedy said the continued execution of the company’s strategy to concentrate on key brands and drivers of growth had led to a positive quarter.
“We improved net income and free cash flow, reduced debt, grew Revlon color cosmetics US retail sales over 9 percent and increased market share,” he said.
“We believe that the continued execution of our strategy will, over time, generate profitable net sales growth and sustainable positive free cash flow.”
New CEO
From May 1, Kennedy will be replaced by Alan T. Ennis as the CEO, with the former taking the position as vice chairman of the board.
Ennis has served as the company’s CFO, executive vice president and president of Revlon International. Steven Berns will take the position of CFO later in the month.
Commenting on today’s announcement, Kennedy said: “This planned leadership transition ensures that we have highly capable executives to continue to lead our business. I am most confident that Alan is best positioned to lead the Company, as he has strong leadership capability, strategic ability and financial acumen.”
Kennedy will also become the senior executive vice president at Revlon’s largest shareholder MacAndrews & Forbes Holdings.
Earlier this month Revlon received an offer from MacAndrews & Forbes Holdings to buy-out shares in the business, which would serve to reduce the debt load for the company.
