Revlon sales increase but litigation costs hit operating profit

Revlon has enjoyed net sales growth of $5.9m (up 1.7%) to $357.1m in the second quarter of 2012. The increase was primarily driven by higher net sales of Revlon and Almay colour cosmetics and Revlon ColorSilk hair colour, and growth was especially strong in the Americas, with sales up 4.6% (to $203.9m) in the US and 22.8% (to $32.3m) in Latin America, which benefited from higher selling prices in Venezuela and Argentina. Revlon’s Asia Pacific sales slid 4.6% to $55.8m due to lower sales in China and Australia. Meanwhile EMEA sales were $44.4m, down 14.6%.

Operating income in Q2 2012 was $42.8m, compared to $47.8m in the prior year period while adjusted EBITDA was $58.7m, compared to $63.3m. These were negatively impacted by a net charge of $6.7m with respect to estimated costs of resolving the pending litigation related to the company’s 2009 exchange offer.

Revlon’s acquisition of certain assets of Bari Cosmetics earlier this month, including Pure Ice nail enamel, did not impact the company’s Q2 2012 financial statements.

For the first six months of 2012, meanwhile, net sales amounted to $687.8m, while operating income was $87.1m.

“In the second quarter of 2012, we delivered top line growth of 4.2% and maintained competitive operating margins,” commented president and ceo Alan T Ennis. “From a marketplace perspective we introduced successful innovative high quality consumer preferred products into the marketplace and earlier this month added the Pure Ice brand to our portfolio. We remain focused on delivering on our strategic objective of growing our business.”