NEW YORK — Revlon, a cosmetics maker that broke racial limitations and dictated magnificence developments for a lot of the final century, has filed for Chapter 11 chapter safety.
The corporate has been a mainstay on retailer cabinets since its founding 90 years in the past in New York Metropolis, overseeing a steady of family names, from Almay to Elizabeth Arden.
However Revlon didn’t hold tempo with altering tastes, gradual to observe girls as they traded flashy purple lipstick for extra muted tones within the Nineties.
Along with shedding market share to large rivals like Procter & Gamble, newcomer beauty strains from Kylie Jenner and different celebrities efficiently capitalized on the large social media following of the well-known faces that fronted the merchandise.
Already weighed down by rising debt, Revlon’s issues solely intensified with the pandemic as lipstick gave method to a brand new period in vogue, this one that includes medical-grade masks.
Gross sales dropped 21% in 2020, the primary 12 months of the pandemic, although they rebounded 9.2% within the firm’s most up-to-date reporting 12 months with vaccines widespread. Within the newest quarter that resulted in March, Revlon’s gross sales rose almost 8%, however nonetheless lag pre-pandemic ranges in extra of $2.4 billion a 12 months.
The worldwide provide chain disruptions which can be hobbling a whole lot of worldwide corporations in current months have been an excessive amount of for Revlon, which barely escaped chapter in late 2020 by persuading bondholders to increase its maturing debt.
There could also be extra company restructurings within the shopper merchandise sector forward with the specter of a recession and the rising prices of borrowing cash.
Revlon mentioned Thursday that upon court docket approval, it expects to obtain $575 million in financing from its current lenders, which can enable it to maintain its day-to-day operations operating.
“At the moment’s submitting will enable Revlon to supply our shoppers the enduring merchandise now we have delivered for many years, whereas offering a clearer path for our future development,” mentioned Debra Perelman, who was named Revlon president and CEO in 2018.
Her father, billionaire Ron Perelman, backs 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 that demand for its merchandise stays sturdy, however its “difficult capital construction” supplied restricted means to navigate.
Throughout its heyday within the twentieth century, Revlon trailed solely Avon in gross sales. It now holds the twenty second spot amongst cosmetics makers, based on a current rating by vogue commerce journal WWD.
Revlon grew to become the primary magnificence firm to characteristic a Black mannequin in 1970, Naomi Sims. Within the Nineteen Eighties, the corporate energized the cosmetics trade by placing each well-known and yet-to-be-discovered fashions like Iman, Claudia Schiffer, Cindy Crawford and Christy Turlington entrance and heart, promising to make all girls “unforgettable.”
Perelman, in an interview with The Related Press final 12 months earlier than world provide chains locked up, mentioned she was optimistic concerning the future. The corporate doubled-down throughout the pandemic to get extra on-line with companies like one-on-one digital consultations by way of its Elizabeth Arden line, she mentioned.
Perelman additionally mentioned that the corporate was studying from superstar launches to be extra nimble and that Revlon had regained market share.
None of Revlon’s worldwide working subsidiaries are included within the proceedings, apart from Canada and the UK. The submitting was made within the U.S. Chapter Courtroom for the Southern District of New York,
The corporate listed property and liabilities between $1 billion and $10 billion, based on its chapter submitting.
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