Revlon misses 1Q18 top- and bottom-line forecasts
The New York–based Revlon (REV) reported its results for 1Q18 before the bell today. The cosmetics giant fell short of both top- and bottom-line expectations for the quarter.
Its total sales declined 5.7% YoY (year-over-year) to $560.7 million, $32 million short of the Thomson Reuters I/B/E/S Estimates. The adjusted loss per share stood at $1.43, compared to $0.23 in 1Q17. Analysts, in comparison, were expecting a loss of $0.91 per share for 1Q18.
What’s behind the poor results?
Revlon continued to face challenges in its home market as sales plunged 12% in North America during the quarter. All of its reported segments—Revlon (-13.4%), Elizabeth Arden (-13.7%), Portfolio Brands (-5.5%), and Fragrances (-16.1%)—reported reduced business.
However, in international markets, Elizabeth Arden delivered strong results with sales improving 23.5% YoY, driven by strong performance in travel retail channels and China.
“Our quarterly results continue to reflect the challenges the Company faces in the current mass retail and beauty environment in the United States. While our international sales remain strong, we are aggressively driving change and innovation in our brands, products, and sales processes to meet these challenges head on,” said Paul Meister, executive vice chairman of the board.
Revlon stock is facing downward pressure. Its stock price tumbled 9% to 18.10 at 10:56 AM. Competitor Estée Lauder (EL) closed 12% lower after the results on May 2, despite beating on both sales and earnings. Investors were unhappy with the ongoing weakness in the company’s US brick-and-mortar stores.