06.17.22
Revlon shares plummeted 53% on Friday, June 10, after The Wall Street Journal reported that the beauty company was preparing to file for chapter 11 protection.
Update: Revlon filed for Chapter 11 bankruptcy protection this week.
In May, the company reported net sales of $479.6 million for the first quarter of 2022, compared to $445.0 million during the prior-year period, an increase of $34.6 million, or 7.8%.
At the time, Debra Perelman, Revlon’s president and CEO, called the first quarter results “strong on both the top and bottom line.”
The company claims that the Chapter 11 filing will allow Revlon to strategically reorganize its legacy capital structure and improve its long-term outlook, especially amid liquidity constraints brought on by continued global challenges, including supply chain disruption and rising inflation, as well as obligations to its lenders.
Upon receipt of court approval, the company expects to receive $575 million in debtor-in-possession (“DIP”) financing from its existing lender base, which in addition to its existing working capital facility, will provide liquidity to support day-to-day operations. The strong support by the company’s lenders will help the business manage through current macro-economic challenges and in turn enable it to better serve customers.
“Today’s filing will allow Revlon to offer our consumers the iconic products we have delivered for decades, while providing a clearer path for our future growth,” said Debra Perelman. “Consumer demand for our products remains strong – people love our brands, and we continue to have a healthy market position. But our challenging capital structure has limited our ability to navigate macro-economic issues in order to meet this demand.”
Perelman continued, “By addressing these complex legacy debt constraints, we expect to be able to simplify our capital structure and significantly reduce our debt, enabling us to unlock the full potential of our globally recognized brands.”
Update: Revlon filed for Chapter 11 bankruptcy protection this week.
In May, the company reported net sales of $479.6 million for the first quarter of 2022, compared to $445.0 million during the prior-year period, an increase of $34.6 million, or 7.8%.
At the time, Debra Perelman, Revlon’s president and CEO, called the first quarter results “strong on both the top and bottom line.”
Filing for Chapter 11
On June 16, Revlon Inc. filed voluntary petitions for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the Southern District of New York.The company claims that the Chapter 11 filing will allow Revlon to strategically reorganize its legacy capital structure and improve its long-term outlook, especially amid liquidity constraints brought on by continued global challenges, including supply chain disruption and rising inflation, as well as obligations to its lenders.
Upon receipt of court approval, the company expects to receive $575 million in debtor-in-possession (“DIP”) financing from its existing lender base, which in addition to its existing working capital facility, will provide liquidity to support day-to-day operations. The strong support by the company’s lenders will help the business manage through current macro-economic challenges and in turn enable it to better serve customers.
“Today’s filing will allow Revlon to offer our consumers the iconic products we have delivered for decades, while providing a clearer path for our future growth,” said Debra Perelman. “Consumer demand for our products remains strong – people love our brands, and we continue to have a healthy market position. But our challenging capital structure has limited our ability to navigate macro-economic issues in order to meet this demand.”
Perelman continued, “By addressing these complex legacy debt constraints, we expect to be able to simplify our capital structure and significantly reduce our debt, enabling us to unlock the full potential of our globally recognized brands.”
