NEW YORK -- Although Revlon Inc.'s fourth-quarter losses narrowed, results were lower than expected and suggested a tough road ahead for newly named president and chief executive officer Jack Stahl.
Investors weren't spooked, however, and gave Revlon's new captain a vote of confidence by pushing up shares of the firm 50 cents, or 10.4 percent, to close Monday at $5.30 on the New York Stock Exchange.
Net losses for the quarter narrowed to $28.3 million, or 54 cents a share, against $51.3 million, or 98 cents, a year ago. The quarter's results were weighed down by a $3.6 million, or 7 cent, extraordinary item related to the early extinguishment of debt.
Losses from ongoing operations shrunk to $6.5 million, or 12 cents a share, from $29.2 million, or 56 cents, a year ago. This deficit, although smaller on a year-over-year basis, was twice that of Wall Street's expectations of 6 cents a share.
Sales for the quarter ended Dec. 31 increased 6 percent, to $332.5 million from $313.6 million, a year ago. Revenues from ongoing operations jumped 10.7 percent, to $332.5 million.
In a statement, executive vice president and chief financial officer Doug Greeff said: "While we made significant progress in 2001 with new products, we were disappointed with the overall level of consumption of our products. Improving customer take-away of our products is our primary goal for the 2002 and 2003 period."
Revlon brand market share of color cosmetics during the quarter totaled 15.7 percent, down from 16 percent in the preceding quarter and 17.1 percent a year ago.
Market share is not the top priority, however. Greeff, on a conference call, said Revlon was shooting for "profitable growth in consumption and market share, based on outstanding consumer-based marketing and strong execution."
Stahl, who is Revlon's third ceo in five years, hails from Coca-Cola and will spend the next three to four months closely studying the firm's business. At the end of that period he plans to emerge with a plan for the future.
"We will uncover significant, what I would call fertile, ground for growth in this business," he said. Stahl promised analysts he would be "very respectful of the differences" between Coke and Revlon. He described a brand as "a promise of what it is people want" from a product and noted that there are "differences in brands, but similarity in the way markets are built." Both the Coke and Revlon brands, he said, "deliver a little psychological boost" to the customer.
Hermès is launching a Laundromat pop-up shop in NYC - dubbed Hermèsmatic - where customers can bring their old scarves to be dip-dyed by an expert. Get all the details on WWD.com. #wwdnews (📷: @donstahl)