NEW YORK (AP) – Revlon, a cosmetics producer that broke racist limitations and dictated magnificence tendencies for a lot of the final century, has utilized 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 well-known names, from Almay to Elizabeth Arden.
However Revlon didn’t preserve tempo with altering tastes, sluggish to comply with girls as they switched flashy purple lipstick to extra muted tones within the Nineties.
Along with shedding market share to main rivals equivalent to Procter & Gamble, the newcomer’s beauty strains from Kylie Jenner and different celebrities efficiently took benefit of the large social media follower of the well-known faces who stood for the merchandise.
Already burdened by rising debt, Revlon’s issues solely worsened with the pandemic when lipstick gave method to a brand new period in vogue, this one with medical-quality masks.
Gross sales fell by 21% in 2020, the primary yr of the pandemic, though it recovered by 9.2% through the firm’s most up-to-date reporting yr with vaccines that had been widespread. Over the last quarter ending in March, Revlon’s gross sales rose by virtually 8%, however are nonetheless lagging behind pre-pandemic ranges of over $ 2.4 billion per yr.
The disruptions of the worldwide provide chain which have hampered lots of of worldwide corporations in latest months had been an excessive amount of for Revlon, which barely escaped chapter on the finish of 2020 by persuading bondholders to increase their overdue debt.
There could also be extra company restructuring within the shopper product sector sooner or later with the specter of a recession and the rising value of borrowing cash.
Revlon mentioned on Thursday that after the courtroom’s approval, it expects to obtain $ 575 million in funding from its current lenders, enabling it to proceed its day-to-day operations.
“Immediately’s announcement will allow Revlon to supply our customers the long-lasting merchandise we have now delivered for many years, whereas offering a clearer path for our future development,” mentioned Debra Perelman, who was named Revlon’s President and CEO 2018.
Her father, billionaire Ron Perelman, helps the corporate by means of MacAndrews & Forbes, which acquired the enterprise by means of a hostile takeover in 1985. Revlon went public in 1996.
Perelman mentioned demand for its merchandise remained sturdy, however its “difficult capital construction” provided restricted means to navigate.
Throughout its heyday within the twentieth century, Revlon was solely after Avon on sale. It now ranks twenty second amongst cosmetics producers, in keeping with a latest rating by vogue journal WWD.
Revlon grew to become the primary magnificence firm with a black mannequin in 1970, Naomi Sims. Within the Nineteen Eighties, the corporate gave power to the cosmetics business by placing each well-known and as but undiscovered fashions equivalent to Iman, Claudia Schiffer, Cindy Crawford and Christy Turlington on the middle, and promised to make all girls “unforgettable”.
In an interview with The Related Press final yr earlier than the worldwide provide chains closed, Perelman mentioned she was optimistic in regards to the future. The corporate doubled through the pandemic to get extra on-line with providers like one-on-one digital consultations by means of its Elizabeth Arden line, she mentioned.
Perelman additionally mentioned that the corporate discovered from superstar launches to be smoother and that Revlon had regained market share.
None of Revlon’s worldwide working subsidiaries is concerned within the continuing, besides Canada and the UK. The lawsuit was filed within the U.S. District Courtroom for Southern District of New York,
The corporate listed belongings and liabilities between $ 1 billion and $ 10 billion, in keeping with its chapter utility.
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