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Revlon consumer segment slightly decreased

Staff writer |
Revlon announced results for the third quarter ended September 30, 2014. Consumer segment net sales decreased 0.9% to $348.2 million, as compared to pro forma net sales of $351.3 million in Q3 2013.

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Excluding the impact of foreign currency fluctuations (XFX), net sales during the third quarter of 2014 increased 2.0%, primarily driven by $8.8 million of favorable returns reserve adjustments in the U.S. as a result of lower expected discontinued products in the future related to the Company's strategy to focus on fewer, bigger and better innovations, partially offset by increased returns expense for current year returns.

The third quarter of 2014 also had lower net sales of Almay color cosmetics and SinfulColors color cosmetics, partially offset by higher net sales of Mitchum products in the third quarter of 2014. The Consumer segment also includes the results of retail brands acquired in the TCG acquisition, which represented $19.6 million of As Reported net sales in the third quarter of 2014 and $18.2 million of Pro Forma net sales in the third quarter of 2013.

Consumer segment profit in the third quarter of 2014 was $78.1 million, as compared to Pro Forma Consumer segment profit of $80.4 million in the third quarter of 2013. On an XFX basis, Consumer segment profit during the third quarter of 2014 increased 1.6%, primarily driven by higher gross profit as a result of the returns adjustment discussed above.

This increase was mostly offset by $3.8 million of higher advertising expense to support the Company's Consumer brands. Professional Segment Professional segment net sales for the third quarter of 2014 were $124.1 million compared to Pro Forma net sales of $122.6 million in the third quarter of 2013.

On an XFX basis, net sales during the third quarter of 2014 increased 2.0% primarily due to higher net sales of American Crew, Revlon Professional products and Creme of Nature products, partially offset by lower net sales of CND nail products.

Professional segment profit in the third quarter of 2014 was $25.2 million, as compared to Pro Forma Professional segment profit of $25.8 million in the third quarter of 2013. On an XFX basis, Professional segment profit was essentially flat quarter over quarter.


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