Revlon, one of the most iconic and long-running brands in the cosmetic industry, neared over a century of production but was forced to file for Chapter 11 bankruptcy on Thursday. The near-century-old brand explained their decision comes from “macro-economic issues,” with “legacy debt” challenges and supply-chain disruptions as some of the defining factors.
As a result, Revlon will be receiving $575 million in debtor-in-possession financing to support the brand’s day-to-day operations.
“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 Revlon President and CEO Debra Perelman in a company statement. “Consumer demand for our products remains strong – people love our brands, and we continue to have a healthy market position.”
Despite solid earnings in the first quarter of 2022, the effects of the COVID-19 pandemic left a significant impact on the company that was far too overwhelming to mitigate for Revlon.
The reports show Revlon hit its highest first-quarter operating income in six years with $479.6 million in net sales, a year-over-year increase of 7.8%.
CEO Perelman admitted that supply chain challenges still affected the company, citing Revlon’s strategy to double down on “core” brands and implement an aggressive digital strategy. As a result, the company saw a $67 million net loss in the first quarter.
Revlon was previously acquired in 2016 by former rival brand Elizabeth Arden in a deal reported to be around $870 million. The purchase left Revlon as the parent brand forward-facing and on the NYSE as the ticker symbol.
“We expect to benefit from greater scale, an expanded global footprint and a significant presence across all major beauty categories and channels,” said Revlon in 2016. “As a combined organization with net sales of approximately $3 billion, this acquisition will help to further accelerate our growth trajectory, position us among the top beauty players and unlock far greater upside than either company would have realized on a stand-alone basis.”
Revlon was founded by Charles and Joseph Revson and Charles Lachman in 1932. It later went public in 1996 on the stock exchange. Since its founding, Revlon has housed top brands, including Britney Spears Fragrances and Christina Aguilera Fragrances.