RVELON

Presented To

Sir Shahid Mehmood

Presented by

GROUP # 6
 GROUP NO. 6
SIDRA NOOR KHAN 11
NAZIA QAMAR 08
SHAHNEELA NAZ 40
AYSHA SAHAR 25
SHAHBAZ GHLIB 13
Introduction & Overview

SHAHBAZ GHALIB
ROLL NO 13
 Overview
• Introduction
• Products & Brands of Revlon
• Financial Analysis
• Competitor of Revlon
• SWOT Analysis
• Five Forces of Industry Competition
• Strategies of Revlon
 Overview
• Revlon is a world leader in cosmetics, skin care,
fragrance and personal care and is a leading mass market
cosmetics brand. Our vision is to provide glamour,
excitement and innovation through quality products at
affordable prices.
 Overview
• Our global brand name recognition, product
quality and marketing experience have enabled
us to create one of the strongest consumer brand
franchises in the world, with our products sold in
approximately 175 countries and territories.
Revlon's brands include Revlon®, ColorStay®,
New Complexion®, Revlon Age Defying®,
Almay®, Ultima II® and Flex® and Charlie®.
 History

• Revlon was founded in the midest of the Great

depression, 1932, by Charles Revson and his
brother Joseph, along with a chemist, Charles
Lachman, who contributed the "L" in the
REVLON name.
 History

• Starting with a single product — a new type of

nail enamel — the three founders pooled their
resources and developed a unique manufecturing
process. Revlon developed a variety of new
shades of opaque nail enamel. Successful in
salons from the start, in 1937 Revlon started
selling the polishes in department stores and drug
stores.
 History

• In six years the company became a multimillion

dollar organization. By 1940, Revlon offered an
entire manicure line, and added lipstick to the
collection. During World War II Revlon created
makeup and related products for the U.S. Army,
which was honored in 1944 with the Army-Navy
‘E’ Award for Excellence
 Ownership

• MacAndrews & Forbes Holdings: 60%(74% of

votes)
MacAndrews & Forbes Holdings, Inc. is the
principalholding company used by and wholly
owned by private equity investor,
Ronald Perelman. MacAndrews & Forbes holds
interests in a diversified portfolio of public and private
companies
 FMR Corp.: 20%
• Fidelity Investments is an investment company.
It consists of two independent but closely
cooperating companies, Fidelity Management
and Research LLC (FMR LLC), founded in
1946 and serving North America, and Fidelity
International Limited (FIL), spun off in 1969
and serving the rest of the world.
 Corporate governance

• Current members of the

board of directors of
Revlon are: Alan
Bernikow, Paul Bohan,
Meyer Feldberg, Debra
Lee, David Kennedy,
Ronald Perelman, Linda
Robinson, Barry David L. Kennedy
Schwartz, Kathi Seifert, President and Chief Executive
and Ken Wolfe. Officer
 Subsidiaries
• Domestic
• Almay, Inc., a Delaware corporation
• Charles of the Ritz Group Ltd., a Delaware corporation
• Charles Revson Inc., a New York corporation
• Cosmetics & More Inc., a Delaware corporation
• North America Revsale Inc., a New York corporation
• PPI Two Corporation, a Delaware corporation
• Revlon Consumer Corp., a Delaware corporation
Products & Brands of
Revlon
 BRANDS OF REVLON
Revlon®,
ColorStay®,
New Complexion®,
Revlon Age Defying®,
Almay®,
Ultima II®
Flex® and Charlie®.
 Products & Brands of Revlon

• Lips
• Face
• Eyes
• Nails
• Hair Color
• Beauty Tools
 Lips
Lips Products are
lipstick
lip glaze
lip liner
lip shiner
crème gloss
liquid lip stick.
L
i
p
s
 FACE
PRODUCTS
Face Matching Makeup
Smoothing Premier
Pressed powder
Finishing powder
Matte powder blush
 HAIR COLOR
PRODUCTS
 Color silk
 Color silk root perfect
 Frost & glow
 Revlon colorist
Shampoo & Gel
 EYES
PRODUCTS
 Matte eye shadow
 Powder eye shadow
 Mineral eye shadow
 Kohl eye liner
 Liquid eye pin
 Eye pencil
 NAIL
PRODUCTS
 Nail Enamel
 Naturally Chic
 Daily wear
 Color allure
 Cuticle remover
 Gel nail hardener
 BEAUTY TOOL
PRODUCTS
 Eyes shape
 Curl
 Finish
 Prep + shape
 Groom
 Smooth + treat
 FRAGRANCE
• PRODUCTS
 Charlie
 Ciara
 Enjoli
 Fire& Ice
 Jean Nate
 Jontue
Body Spray
FINANCIAL STATEMENT AND
RATIO ANALYSIS

Aysha sahar
ROLL NO 25
Financial Analysis
INCOME STATEMENT
 REVLON Financial Overview

Income Statement: REVLON

2008 2007 Change (2007 - 2008)
Net Sales/Revenues 1346
M 1367 -21M
M
Gross Profit 855 861M -6
M M
Net Income 57.9 -
M 13.1M 71 M

Operating Income 155 118.4M

M 36.67 M
Cash Flow:
 Cash Flow:
2008 2007 Change (2007 - 2008)
Net Cash Flow - 21.3 2.5 18.5
Operating
Net Cash Flow - 100.5 - 118.5
Investing 17
.6

Net Cash Flow/ -112.3 24.5 -87.8

Financing Activities

Net change in 7.7 9.9 -2.2

cash
Balance Sheet:
 Balance Sheet:
2008 2007Change (2007 - 2008)

Total Assets 813.4 M 889 M -78.6 M

Total Liabilities 1926.2 M 1971.3M 24.8 M

Shareholders Equity -1113 M -1082M 31 M

RATIOS ANALYSIS
 Ratio Analysis
• Profitability Ratio

• Liquidity Ratio

• Activity Ratio

• Debt Ratio
 Profitability
Gross Margin 63.5%

Operating Margin 11.5%

Profit Margin 0.97%

 Profitability

Return on Equity -5.20%

Return on Assets 16.37 %

Return on Investments
Liquidity ratio
 Liquidity Ratio
Quick Ratio .84:1

Current Ratio 1.32:1

Cash Ratio .16:1

 Activity Ratio
Inventory turnover 3.18 times

Account receivable turnover 7.93times

Total asset turnover 1.65times

Days sales in Receivable 46 Days

Days sales in Inventory 114.6 Days

Debt Ratio
 Debt Ratio

Debt Ratio 237%

Debt/Equity Ratio -119.48

 Key Ratio :

Price/Earnings 1.13
Competitor Comparison

SIDRA NOOR KHAN

ROLL NO 11
Competitor Comparison
 Competitor Comparison

Avon

Top Segment cosmetics Consumer care CG/Food cosmetics

Top Brand Revlon Tide Dove
CEO David L.kendy A.G. Lafley A.Burgmans Andrea Jung

Growth 0.72 % 9.25% 15.58% 5.2%

Revenues 1346.8M 28200 m 42942M 10690m
Revenue Growth -10.50% 19% -11.93% -8.70%
International 100+ 42 100+ 100+
Business Segments 3 5 3 2
Employees 350000 110000 234000 42000
June 7, 2010 GROUP # 4 57
June 7, 2010 GROUP # 4 58
June 7, 2010 GROUP # 4 59
 Top Competitors Key Measures:
REVLON

REVLON AVON P&G

Valuation
Price/Earnings 1.13 7.88 — 16.75
 Per Share Data
REVLON AVON P&G
Last Dividend 0 $ 0.80 — 43.36

Revenue 1.35B 10.69B — 83.5 B

 Profitability
REVLON AVON ------ P&G

Operating Margin 11.5% 13.10% — 22.13%

Profit Margin 0.97% 8.18% — 14.46%

Gross Profit Margin 63.5% 63.09% — 51.27%

 Growth REVLON AVON ------ P&G

Net Income 57.9M 875.30M — 12070 M

Revenue 1346M 10690M — 83500M

 Financial Strength
REVLON AVON --------- PG

Quick Ratio .84 3.15 14.46

Current Ratio 1.32 7.07 0.69
LT Debt to Equity Ratio -117 83.73 32.45
ROE -5.20 7.93 17.34
ROA 7.11 5.69 10.61
ROIC (Return on Invested Capital) 5.2 8.22 12.51
 Assets
REVLON AVON ------------- P&G

Asset Turnover 0.82 0.67 0.58

Inventory Turnover 3.55 6.95 4.93

SWOT ANALYSIS & PORTER
MODEL

NAZIA QAMAR
Roll No.08
Strengths
 Strengths

Leader in mass-market cosmetic brand

 Strong relationship with retailers
Known Word Wide in nail Product
Present in 175 Countries
Weaknesses
 Weaknesses
Too much focus on streamlining operations
rather than improving revenues
Low spending on promotion and marketing
Relatively low R&D spending <2%
Most product has short life cycle as they rely on
color i.e. is nail polish
OPPERTUNITIES
 Opportunities

New executive team appointed to boost sales

Recently, more spending on ads and promotions
McAndrews & Forbes financial support to
improve cash flow
Create uniform images split up between world
wide region
 Threats

Recently downgraded by S&P from CCC- to CC

JC Penny cut cosmetics (incl. Revlon) out of
shelves due to low sales
Divers marketing Strategies
Need a global strategies to succeed around the
world
Large financial losses makes an unstable
company
 Five Forces of Industry Competition

Potential Entrants
Threat of
new entrants

Industry
Bargaining power Competitors Bargaining power
of suppliers of customers

Suppliers Customers

Rivalry Among
Existing Firms
Threat of
substitute products
or services
Substitute
s
Internal Rivalry
 Internal rivalry

Internal rivalry in the cosmetic industry is high.

There are a lot of existing cosmetic companies
competing in the market. The environment
endorses giant corporations to acquire numerous
brand name products.
Threat of new entry
 Threat of entry

Threat of entry is high. To build a cosmetic company

requires a significant amount of capital investments,
associated with research and development (R&D) and
marketing expenditures. Cosmetic companies are no
different than drugs companies. There are a lot of
regulations and requirements imposed by the
government to launch a single product. This is due to a
high level of direct contact between cosmetics products
and human body.
 Products substitutes

Products substitutes are not available in the

market. Products complements are high. Beauty
tools (brush, mirror, cottons ball, etc.) are needed
to complement most of cosmetics products. The
price of product complements will definitely
affect the sales of cosmetics products.
Buyer
 Buyer

Buyer (i.e. consumer) power is high, since there

are a variety of cosmetics products available in
the markets, ranging in price. All firms are
competing to attract consumer’s attention by
providing the best quality, most stylish, and great
price.
Supplier
 Supplier

Supplier power ranges from low to medium.

Owing to a lot of merging and acquisitions, the
monopoly in the cosmetics industry will be huge in
the future. If the industry is becoming
monopolized, therefore, suppliers will have low
power, where they will compete tightly in order to
get the biggest piece of share.
 STRATEGIES AND
RECOMMENDATION

SHAHNEELA NAZ
ROLL NO 40
 STRATEGIES
• Building and leveraging our strong brands.
• Improving the execution of our strategies and plans
and providing for continued improvement
• in our organizational capability through enabling and
developing our employees.
• Continuing to strengthen our international business.
• Improving our operating profit margins and cash flow.
• Continuing to improve our capital structure.
Building and leveraging our strong brands.
in our organizational capability through enabling
and developing our employees.
Continuing to strengthen our international business.
Improving our operating profit margins and cash
flow.
Continuing to improve our capital structure.
 Revlon, Inc. conducts its business through its direct wholly
owned operating subsidiary, Revlon Consumer Products
Corporation and its subsidiaries (Products Corporation), which
manufactures markets and sells an array of cosmetics, skincare,
fragrances, beauty tools, hair color and personal care products.
The company is a mass-market cosmetics brand.

June 7, 2010 GROUP # 4 94