THE WHAT? Revlon CEO Debra Perelman said that the US beauty firm saw ‘positive developments’ in the final quarter of fiscal 2020, despite reporting a 10.4 percent drop in net sales to US$626.2 million.
THE DETAILS As Perelman noted, e-commerce sales were up 39 percent in the three months to December 31, 2020 and represented approximately 20 percent of fourth quarter sales versus 13 percent in the prior-year period.
Operating income fell to US$28.4 million compared to US$76.7 million in fiscal 2019, primarily due to the adverse impacts of the COVID-19 pandemic on net sales, sales mix and higher manufacturing overheads.
THE WHY? Perelman reveals, “In the fourth quarter of 2020, we continued to see positive developments tracing back to the transformational initiatives begun in the second half of 2018 to rationalize the business, capture our share of the E-commerce channel, and launch new products in the segments that will add the greatest value to the Company. While these initiatives, including the Revlon 2020 Restructuring Program, were designed with a long-term view of our business, they have also been essential in helping to mitigate the ongoing effects of COVID-19. The impact of our disciplined expense controls and cost cutting measures was reflected in our adjusted EBITDA margin, which improved approximately 200 basis points from last quarter. We also saw yet another sequential improvement in our net sales decline – continuing a trend from the prior two quarters.
“We are seeing signs of broader positive momentum in the business, and with several major 2020 challenges behind us we believe we are well positioned to capture the re-emerging opportunities in the beauty industry. We continue to execute against the key pillars of our strategy, including driving growth in our iconic brands of Revlon and Elizabeth Arden, key markets such as China, and accelerating our e-commerce business. This remained our focus throughout 2020 and we are committed to delivering against these plans in 2021