Revlon, the multinational beauty company, has filed for bankruptcy protection in the US, because of debt load, disruptions to its supply chain network and surging costs.
The New York-based company said that on court approval, it expects to receive $575m (£469m) in financing from its existing lenders, which will allow it to keep its day-to-day operations running.
Debra Perelman, Revlon president and CEO said: “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.”
Revlon’s problems intensified with the pandemic, which hurt sales of lipsticks as people wore masks. Sales fell 21% to $1.9bn in 2020 but rebounded 9.2% to $2.08bn in 2022 as shoppers went back to pre-pandemic routines. In the latest quarter that ended in March, sales rose nearly 8%. The company avoided bankruptcy in late 2020 by persuading enough bondholders to extend its maturing debt.
In recent months, Revlon experienced industry-wide supply chain challenges and higher costs. The beauty company said in March that logistical issues hurt its ability to meet customer orders. It also said it was stymied by rising prices on key ingredients and persistent labour shortages.
None of Revlon’s international operating subsidiaries is included in the proceedings, except for Canada and the UK. The filing was made in the US Bankruptcy Court for the Southern District of New York.
The company listed assets and liabilities between $1bn and $10bn, according to the filing.
Source: Revlon files for bankruptcy in US after supply chain trouble and surging costs | Retail industry | The Guardian