Revlon Inc. saw its fourth-quarter profits surge upward, helped by growth in most of its global markets and a hefty income tax benefit.
For the quarter ended Dec. 31, the beauty firm recorded net income of $296.2 million, or $5.66 a diluted share, versus profits of $12.8 million, or 24 cents a share, in the year-ago period. Stripping out an income tax benefit, the company earned $35.6 million, or 68 cents a diluted share.
Net sales grew 7.1 percent to $369.2 million from $344.6 million a year earlier.
For the year, net income was $327.3 million, or $6.26 a diluted share, compared to $48.8 million, or 94 cents a share. Net sales for 2010 gained 2 percent to $1.32 billion, from $1.3 billion the prior year. Excluding unfavorable foreign currency fluctuations, net sales gained 2.3 percent.
“Following two years of declining net sales, we grew 2.3 percent in 2010,” said Alan Ennis, president and chief executive officer. “Strong performance in all of our regions outside of the U.S. was partially offset by a decline in the U.S. region.”
For the quarter, U.S. sales gained 7.5 percent to $201 million, driven by sales of Revlon and Almay cosmetics. However, for the year, U.S. sales decreased 2.5 percent.
Ennis acknowledged “one quarter doesn’t make a trend,” but added, “We believe that we’re doing a lot of the right things to drive U.S. business to be profitable and to grow.”
Revlon said efforts are under way to improve the U.S. business, including revamping in-store displays with new graphics and tweaks in layout.
“There is a much stronger presentation of the iconic nature of the brand using all of our brand ambassadors,” said Julia Goldin, who was named global chief marketing officer last fall. She added that wall displays will have a more consistent look that calls attention to new products. The company plans to spend $40 million on in-store displays this year.
Revlon also expects to benefit from the appointment of Goldin and John Collier, who was tapped as senior vice president and general manager for the U.S.
The company did increase its media presence in 2010, while benefiting from lower rates and plans to do the same in the first quarter of 2011. Ennis told WWD, “We are focused on building our strong brands” through the right mix of advertising and media with the right in-store strategy.
Earlier this month, Collier said that Revlon is also approaching the market more aggressively this year with “high-impact, blanket” marketing, where over a 24-hour period messages are sent via print, TV and digital avenues.