Burdened by debt and inflation, the multinational beauty products company Revlon filed for bankruptcy this Thursday90 years after its creation.

The New York-based company said it expects to receive loans for $ 575 million from your existing lenders to keep your day-to-day operations running.

Of all Revlon’s international subsidiaries in operation, Canada and UK only are included in the process. The application was filed with the United States Bankruptcy Court for the Southern District of New York.

“This introduction will enable Revlon to offer our consumers the iconic products we have been supplying for decades, while providing us with clearer path for our future growth“said Debra Perelman, who was named Revlon president and CEO in 2018.

His father, billionaire Ron Perelman, supports the company through MacAndrews & Forbes, which acquired the business through what is known as a hostile takeover in the late 1980s. Revlon went public in 1996.

While he said demand for his products remains strong, Perelman confessed that “the difficult way capital is structured” it limits your ability to address macroeconomic issues current.

Old and new problems for Revlon

Revlon brands, which include everything from Almay to Elizabeth Arden, are a constant presence on beauty store shelves. However, for some years now the company has had problems with his difficulty responding to changes in beauty criteria and growing competition.

The company has been slow to adapt to the transition from brightly colored cosmetics, such as red lipstick, to more muted shades, which began in the 1990s.

also revlon faced increasing competitionnot only from companies like Procter & Gamble, but also from well-known brands like Kylie Jenner, who don’t have to spend a lot on marketing due to their huge social media following.

Revlon problems only escalated with the pandemicwhich influenced lipstick sales as people dressed up.

Sales fell 21% to $ 1.9 billion in 2020, but rebounded 9.2% to $ 2.08 billion in 2022 as shoppers returned to pre-pandemic routines.

In the last quarter ending in March, sales increased by almost 8%. The company avoided bankruptcy in late 2020 by convincing enough bondholders to roll over their overdue debt.

In recent months, Revlon, like many other companies, has faced industry-wide supply chain challenges and rising costs.

The beauty company said in March that logistical issues were compromising its ability to fulfill customer orders. She also said she was hampered by the rising prices of key ingredients and persistent labor shortages.

Source: AP