Revlon sales drop on poor color cosmetics performance

The US headquartered company has reported a drop in sales and net income for the year and warns of the effect of the Venezuelan currency devaluation on the coming year.

Sales for 2009 dropped 3.8 percent in comparison to 2008’s figures, from $1.35bn to $1.30bn, and the company puts this down to a weaker performance from the Revlon and Almay color cosmetics brands.

In contrast, the company’s hair color range RevlonColor Silk performed well in almost all markets.

Net income fell 10.2 percent for the period compared to 2008, coming in at $48.8m in comparison to the $57.9m that was recorded the year before.

International results stronger than US

The international sales for the company were better than its domestic performance, although according to Revlon strong performances in Latin America and Asia Pacific were dragged down by weak performance in Europe.

Excluding unfavorable currency fluctuations, net sales for the year in its international division ($548m) increased 1.7 percent (including the effects of currency fluctuations leads to a drop of 2.9 percent) compared to last year’s figures.

In the US, the company’s biggest market, net sales were $747.9m a decrease of 4.4 percent compared to 2008.

Bolivar devaluation will be felt in 2010

Venezuela is one of the company’s important markets in the Latin American region and Revlon said the effects of its recent currency devaluation will be felt in the coming months.

In 2009 the country accounted for 4 percent of Revlon’s net sales and 7 percent of the net income for the year, and the drop in value of the Bolivar for non essential goods is expected to negatively affect sales.