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Coty Delivers Strong 1Q22 Results, Well Ahead of Expectations


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November 18th Investor Day to Detail Strategic Progress and Medium Term Trajectory

NEW YORK–(BUSINESS WIRE)–
Coty Inc. (NYSE: COTY) (“Coty” or “the Company”) in the present day introduced one other quarter of enchancment in its monetary outcomes and additional progress throughout every of its strategic progress pillars for the primary quarter of fiscal 12 months 2022, ended September 30, 2021.

In Q1, revenues elevated 22%, or 20.6% LFL, surpassing steering of high-teens LFL progress, with a mixture of robust brick & mortar progress and 23% progress in e-commerce. Coty’s Prestige enterprise delivered superior 35% reported and 34% LFL progress within the quarter, regardless of a low single digit unfavorable influence from the continued discount of gross sales in low high quality channels. Prestige perfume gross sales elevated strongly throughout almost all manufacturers, with notably robust efficiency from Gucci, Burberry, Hugo Boss, Marc Jacobs, Calvin Klein, and Chloe. This momentum was fueled by a really robust perfume launch calendar in Q1 with explicit standout outcomes from Gucci Flora Gorgeous Gardenia and Burberry Hero. At the identical time, Prestige cosmetics gross sales greater than doubled year-on-year, led by Gucci make-up and the relaunch of Kylie Cosmetics. Regionally, the U.S. and China continued to ship very strong efficiency, Travel Retail greater than doubled led particularly by Asia and Europe, whereas traits in lots of Western European markets continued to enhance.

During the quarter, Consumer Beauty revenues elevated 4% as reported and three% LFL, as the worldwide mass magnificence class returned to progress and Coty continued to make progress in direction of share stabilization. CoverGirl generated double digit % sell-in and sell-out progress, rising market share in 4 of the final 7 months, with outsized momentum within the Magnificent 8 franchises. Meanwhile, the re-positioning of each Rimmel and Max Factor, which kicked off in the summertime, have additionally been exhibiting strong progress throughout key European markets. Rimmel’s Wonder’Extension mascara has turn into its most profitable mascara launch within the crucial UK and German markets, with momentum constructing exiting Q1 with the launch of Rimmel’s first-to-mass Kind & Free vary of clear, vegan and cruelty free cosmetics merchandise. At the identical time, Max Factor’s launch of its Facefinity basis with Priyanka Chopra Jonas as spokesperson have propelled Max Factor to market share features within the UK for the primary time in years.

The robust topline progress was matched by very strong profitability progress in Q1, supported by each important gross margin enlargement and extra price reductions, enabling a big step-up in advertising and marketing spend, with working media doubling year-on-year. Reported gross margins expanded 460 bps within the quarter to 63.2%, whereas adjusted gross margin was up 480 bps to 63.4%, above pre-pandemic ranges, pushed by a mixture of product and channel combine, improved extra & obsolescence, pricing and blend advantages, and better manufacturing volumes. This substantial enlargement fueled reinvestment behind key strategic initiatives. In addition, Coty continued to decrease its price base, with year-over-year financial savings of roughly $60 million, exhibiting important progress in direction of the FY22 financial savings goal of over $90 million. The Company has now cumulatively achieved near $400M of price financial savings versus the FY20 baseline, and stays on observe to realize roughly $600M of financial savings by FY23. The gross margin enchancment and value reductions allowed Coty to proceed to reinvest behind its manufacturers and highest ROI alternatives, as working media greater than doubled versus final 12 months, and whole A&CP remained constant sequentially at ~26% of gross sales. At the identical time, Coty delivered 1Q22 reported working revenue of $17.2 million and adjusted EBITDA of $278.5 million, growing 67% from final 12 months and leading to an adjusted EBITDA margin of 20.3% or 550 bps enchancment versus 1Q21.

Financial Net Debt improved by roughly $200 million to simply beneath $5 billion on the finish of 1Q. Free money move was robust in a seasonally weaker quarter at $240.7 million. With a rise within the worth of Coty’s 40% Wella stake at quarter finish to roughly $1.65 billion at quarter-end, the Company’s Economic Net Debt totaled roughly $3.3 billion.

Commenting on the working outcomes, Sue Y. Nabi, Coty’s CEO, mentioned:

“Our goal coming into fiscal 2022 was to construct on the good outcomes we delivered final 12 months and additional execute on our strategic progress pillars. I’m very happy to say that we’re off to an amazing begin, constructing upon our success. Q1 marks the fifth consecutive quarter of Coty delivering outcomes inline to forward of expectations. Importantly, our Q1 outcomes exemplify the virtuous cycle that we’ve been working to create, the place our robust topline efficiency coupled with sustained gross margin enlargement and value initiatives, gasoline each revenue enlargement and focused re-investments to assist future progress.

Coty’s profitable execution throughout every of our strategic pillars is exemplified in our Q1 efficiency. The repositioning of three key Consumer Beauty manufacturers – CoverGirl, Rimmel and Max Factor – are taking maintain, returning the general section to progress and pushing the Consumer Beauty enterprise to share stabilization. Gucci Flora and Burberry Hero are nicely on their option to turning into world perfume icons, serving to to speed up our status perfume portfolio, whereas the assortment and distribution enlargement of Gucci and Kylie cosmetics are solidifying Coty as a key participant in status cosmetics. In skincare, Lancaster is constructing momentum in Hainan because the lead marketplace for its repositioning, with a number of thrilling initiatives to return in our skincare portfolio within the coming months. Our e-commerce gross sales continued its momentum, with robust progress throughout each Prestige and Consumer Beauty, with whole e-commerce gross sales up 23%. And the mix of these areas fueled near 50% progress in China. Finally, on sustainability, we’ve concluded our footprint examine reflecting Coty’s scope following the Wella divestiture, and can be publishing our second sustainability report very quickly.

Importantly, at the same time as we tracked industry-wide headwinds starting from choose part shortages, provide chain bottlenecks, and inflationary strain in supplies and freight, the energy of our enterprise mannequin and the agility of our groups allowed to us to exceed our gross sales steering and ship almost 500 bps of gross margin enlargement. We really feel assured about our prospects for the rest of the 12 months and we’re subsequently elevating our FY22 gross sales outlook to low-to-mid teenagers progress from our earlier steering of low teenagers progress. While inflation influence is predicted to step up within the second half of FY22, we consider the influence is kind of manageable, notably as we double-down on accretive improvements and premiumizing our portfolio. As a outcome, we proceed to count on gross margin enlargement for the 12 months as in comparison with FY21. We count on FY22 adjusted EBITDA of $900M at a minimal, as we’re deliberately reinvesting our gross margin achieve and prices financial savings in our manufacturers to maximise worth.

Fifteen months into our turnaround, I’m extremely inspired by the energy of our portfolio, our individuals, and our strategic path, which collectively are delivering leads to document time as we rework Coty into a real chief in magnificence. I sit up for sharing extra particulars on our progress and medium time period trajectory at our Investor Day in New York City subsequent week on November 18th.”

*Adjusted monetary metrics used on this launch are non-GAAP. See reconciliations of GAAP outcomes to Adjusted leads to the accompanying tables.

1Based on truthful market worth, reflecting the Wella capital construction as of September 30, 2021

 

Highlights

  • 1Q22 internet revenues elevated 22% as reported and 20.6% LFL. Net income traits had been led by strong Prestige progress and progress in Consumer Beauty, in addition to e-commerce channels.
  • Reported working revenue was $17.2 million.
  • 1Q22 adjusted working revenue elevated to $200.5 million from an adjusted working revenue of $85.7 million, with 700 bps of margin enlargement to 14.6%.
  • 1Q22 adjusted EBITDA of $278.5 million, elevated 67%, with an adjusted EBITDA margin of 20.3% reflecting over 500bps of margin enlargement.
  • 1Q22 reported EPS of $0.13 and adjusted EPS of $0.08, improved from $(0.01) final 12 months.
  • Cost reductions remained strong with roughly $60 million of extra reductions.
  • 1Q22 free money move of $240.7 million improved by $269.0 million from final 12 months pushed by larger money producing internet revenue, robust working capital enchancment, and reductions to capex spend.
  • Financial Net Debt in step with expectations at $4,955.1 million, which decreased sequentially fueled by the free money move era, bringing the monetary leverage to five.7x. Economic Net Debt is now $3,305.1 million at quarter finish.

Outlook

Entering 2Q22, Coty continues to see magnificence market momentum, together with continued energy within the U.S. and China, a powerful rebound in Travel Retail, and regular enchancment in Western Europe. Given this market backdrop, coupled with very robust efficiency of Coty’s current product launches, Coty raises its FY22 LFL gross sales outlook to low-to-mid teenagers proportion progress, up from its earlier steering of low teenagers progress.

The Company additionally expects FY22 adjusted EBITDA of $900 million at a minimal, on a relentless foreign money foundation, as Coty deliberately reinvests gross margin achieve and prices financial savings in its manufacturers to maximise worth. This displays robust EBITDA margin enlargement YoY. With important progress made up to now in simplifying its capital construction, Coty anticipates FY22 adjusted EPS within the $0.19-0.23 vary.

In addition, the Company continues to focus on leverage transferring in direction of 5x exiting CY21, and an extra discount in leverage to roughly 4x exiting CY22.

Financial Results*

Refer to “Non-GAAP Financial Measures” for dialogue of the non-GAAP monetary measures used on this launch; reconciliations from reported to adjusted outcomes will be discovered on the finish of this launch.

Revenues:

  • 1Q22 reported internet revenues of $1,371.7 million elevated 22.0% year-over-year, together with a constructive international trade (FX) influence of 1.4%. LFL income elevated 20.6%, pushed by a 33.6% enhance in Prestige, and a 3.0% enhance in Consumer Beauty.

Gross Margin:

  • 1Q22 reported gross margin of 63.2% elevated from 58.6% within the prior-year interval, whereas adjusted gross margin of 63.4% elevated from 58.6% in 1Q21. The enhance was due constructive mix-shift, together with in each Prestige and Consumer Beauty, extra & obsolescence enchancment, higher absorption, and improved volumes.

Operating Income and EBITDA:

  • 1Q22 reported working revenue of $17.2 million improved from a reported working loss of $66.0 million within the prior 12 months as a consequence of a $20.3 million discount in restructuring and different enterprise realignment prices, a $42.3 million discount in acquisition and divestiture associated bills, and better gross margin, partially offset by larger SG&A bills stemming from elevated advertising and marketing funding.
  • 1Q22 adjusted working revenue of $200.5 million rose from $85.7 million within the prior 12 months, whereas the adjusted EBITDA of $278.5 million elevated 67% from $166.6 million within the prior 12 months. The enhance was pushed by a better gross margin and continued fastened price reductions, partially offset by larger A&CP bills, primarily inside working media. For 1Q22, the adjusted working margin elevated 700 bps to 14.6%, whereas the adjusted EBITDA margin elevated 550 bps to twenty.3%.

Net Income:

  • 1Q22 reported internet revenue of $103.0 million improved from a internet revenue of $95.9 million within the prior 12 months, primarily because of the $390.0 million change in truthful worth of funding in Wella and the aforementioned enhance in reported working revenue, partially offset by larger taxes in comparison with the year-ago interval.
  • The 1Q22 adjusted internet revenue of $63.1 million elevated from a loss of $9.8 million within the prior 12 months interval.

Earnings Per Share (EPS) – diluted:

  • 1Q22 reported earnings per share of $0.13 remained per a reported earnings per share of $0.13 within the prior 12 months.
  • 1Q22 adjusted EPS of $0.08 improved from $(0.01) within the prior 12 months.

Operating Cash Flow:

  • 1Q22 money from operations totaling $285.7 million improved from $42.6 million within the prior-year interval, reflecting a rise in internet revenue on a money foundation and powerful working capital.
  • 1Q22 free money move of $240.7 million improved from a free money outflow of $28.3 million within the prior 12 months pushed by the rise in working money move of $243.1 million coupled with a $25.9 million discount in capex.

Financial Net Debt:

  • As anticipated, Financial Net Debt of $4,955.1 million on September 30, 2021 decreased from $5,228.0 million on June 30, 2021. The lower was pushed by the robust free money move generated within the quarter.

Immediate Liquidity:

  • Coty ended This fall with $376.9 million in money and money equivalents, and rapid liquidity of $2,526.8 million.

First Quarter Business Review by Segment*

Prestige

In 1Q22, Prestige internet revenues of $870.7 million or 63% of Coty gross sales, elevated by 35.1% versus the prior 12 months. On a LFL foundation, Prestige internet revenues delivered strong progress of 33.6%, pushed by continued energy within the U.S. and China, in addition to many key markets within the EMEA area and Travel Retail. In addition, LFL progress was broad-based throughout fragrances and make-up.

During the quarter, our U.S. Prestige perfume sell-out continued to generate very strong progress, up robust double-digits versus final 12 months, with notably favorable efficiency from Burberry, Marc Jacobs, Gucci, and Chloe. Encouragingly, our current key improvements similar to Gucci Flora Gorgeous Gardenia and Burberry Hero are delivering stellar early outcomes. In the EMEA area, Prestige perfume continued to enhance in 1Q22 as many markets remained on their re-opening trajectories. Similar to the U.S., the EMEA area additionally benefited from very robust outcomes of the current Prestige perfume launches. Despite a resurgence of COVID-19 throughout the quarter, China continued to ship strong outcomes, with income growing nearly 50%.

Coty continued to execute on its latest progress pillars: increasing its presence in Prestige skincare and cosmetics. Within cosmetics, Gucci generated strong triple-digit sell-out progress throughout many key markets together with within the U.S. and China. On skincare, the revitalization of Lancaster in Hainan continues to take maintain with visitors and gross sales rebounding in September, following a short COVID-related slowdown in August.

E-commerce gross sales for the section continued to extend 21% in Q1, with strong progress throughout areas. E-commerce penetration was within the 20% stage on the finish of 1Q22.

The Prestige section generated a reported working revenue of $132.1 million in 1Q22, in comparison with a reported working revenue of $34.0 million within the prior 12 months. The 1Q22 adjusted working revenue was $177.0 million, up from an adjusted working revenue of $85.7 million within the prior 12 months, pushed by gross margin enchancment and glued price discount, partially offset by larger working media bills. Adjusted EBITDA for the Prestige section rose to $215.0 million from $119.8 million within the prior 12 months, with a margin of 24.7%.

Consumer Beauty

In 1Q22, Consumer Beauty internet revenues of $501.0 million, or 37% of Coty gross sales, elevated by 4.4% versus the prior 12 months. On a LFL foundation, Consumer Beauty internet revenues elevated 3.0%.

During the quarter, Coty progressed in direction of share stabilization in Consumer Beauty. In the U.S., CoverGirl continues to show it’s on considerably stronger footing, with the Magnificent 8 franchises outperforming the cosmetics class and the model returning to market share features exiting Q1 and into Q2. Meanwhile, Sally Hansen additionally continued to ship robust efficiency, gaining share all through the quarter with sell-out monitoring above 2019 ranges.

Coty’s stabilization efforts in Europe proceed to take maintain by means of the re-positioning of Rimmel and Max Factor. Capitalizing on the success the Company has had with clear magnificence within the U.S., Coty lately launched Rimmel Kind & Free, the largest Consumer Beauty launch of FY22. Meanwhile, Max Factor is already realizing strong market share features within the UK and Netherlands, with the general model sustaining or gaining share in over 75% of its markets.

1Q22 Consumer Beauty e-commerce gross sales grew 27%, driving e-commerce penetration as a proportion of gross sales to the high-single-digit proportion stage.

Reported working revenue was $11.4 million in 1Q22 versus reported working loss of $13.7 million within the prior 12 months. The 1Q22 adjusted working revenue of $23.5 million elevated from an adjusted working loss of $0.0 million within the prior 12 months, pushed by a better gross margin and strong fastened price reductions, partially offset by a reinvestment in advertising and marketing bills, notably in direction of working media. During the quarter, adjusted EBITDA elevated to $63.5 million from $46.8 million within the prior 12 months, with a margin of 12.7%.

First Quarter Fiscal 2021 Business Review by Region*

Americas

  • In 1Q22, Americas internet revenues of $581.5 million, or 42% of Coty gross sales, elevated 23.6% as reported and elevated 22.9% LFL. This was pushed by notably robust progress of Prestige, and to a lesser extent, Consumer Beauty gross sales progress. Prestige fragrances continued to learn from strong class traits within the U.S., coupled with Coty’s robust pipeline of perfume improvements. CoverGirl grew within the double digits, with good market share momentum exiting Q1 and into Q2, whereas Sally Hansen additionally gained share.

EMEA

  • In 1Q22, EMEA internet revenues of $627.1 million, or 46% of Coty gross sales, elevated 18.2% as reported and 16.6% LFL. Similar to what we skilled within the Americas area, Prestige gross sales progress was strongest, whereas Consumer Beauty grew at a extra reasonable tempo.

Asia Pacific

  • In 1Q22, Asia Pacific internet revenues of $163.1 million, or 12% of Coty gross sales, elevated 32.5% as reported and 29.0% LFL. Sales had been pushed by robust efficiency in China, notably inside Prestige fragrances, whereas status skincare and cosmetics additionally delivered very strong progress.

*As beforehand disclosed, we’ve realigned our reportable segments to a principally product category-based construction, comprised of a Prestige enterprise section and a Consumer Beauty enterprise section. In addition, we’ve amended the definition of inventory compensation expense to be used in sure Non-GAAP Financial Measures. In order to mirror these modifications, the Company has recast reported internet income by section, reported working revenue (loss) by section, adjusted working revenue (loss) by section and whole, adjusted EBITDA by section, and whole adjusted revenue (loss) earlier than revenue taxes and whole adjusted internet revenue (loss) from persevering with operations for all comparative intervals proven.

 

Noteworthy Company Developments

Other noteworthy firm developments embrace:

  • On September 27, 2021, Coty introduced a multi-channel settlement with main magnificence tech options supplier Perfect Corp. that can embed a set of best-in-class augmented actuality and synthetic intelligence experiences into the digital advertising and marketing toolkits of its magnificence manufacturers.
  • On October 1, 2021, Coty introduced a definitive settlement to promote an approximate 9% stake in Wella to KKR in trade for the redemption of roughly half of KKR’s remaining convertible most popular shares in Coty, decreasing its whole shareholding within the skilled magnificence firm to 30.6%.
  • As of November 5, 2021, Coty has obtained binding commitments from lenders beneath the 2018 Coty Credit Agreement to interchange its two current lessons of revolving commitments, having an combination principal quantity of $2,750.0 million, with a single class of revolving commitments, having an combination principal quantity of $2,000.0 million. The ensuing class of revolving commitments may have considerably the identical phrases as the brand new class of revolving commitments established pursuant to the 2021 Coty Revolving Credit Facility, together with a maturity in April 2025, and can be topic to customary closing situations. Coty expects the transaction to shut within the second quarter of FY22.
  • On November 8, 2021, Coty introduced a definitive settlement to promote a further approximate 4.7% stake in Wella to KKR in trade for the redemption of roughly 56% of KKR’s remaining convertible most popular shares in Coty, decreasing its whole shareholding within the skilled magnificence firm to 25.9%. The two Wella trade transactions mirror a key milestone within the simplification of Coty’s capital construction and end in roughly $65 million in annual dividend money financial savings, when mixed with the KKR secondary share providing that closed in September.

Conference Call

Coty Inc. will host a convention name at 8:00 a.m. (ET) in the present day, November 8, 2021 to debate its outcomes. The dial-in quantity for the decision is (800) 895-3361 within the U.S. or (785) 424-1062 internationally (convention passcode quantity: COTY1Q22). The dwell audio webcast and presentation slides can be accessible at http://investors.coty.com. The convention name can be accessible for replay.

About Coty Inc.

Coty is one of the world’s largest magnificence corporations with an iconic portfolio of manufacturers throughout perfume, shade cosmetics, and pores and skin and physique care. Coty is the worldwide chief in perfume, and quantity three in shade cosmetics. Coty markets, sells and distributes the merchandise in roughly 130 international locations and territories. Coty and its manufacturers are dedicated to a variety of social causes in addition to searching for to reduce its influence on the surroundings. For extra details about Coty Inc., please go to www.coty.com.

Forward Looking Statements

Certain statements on this Earnings Release are “forward-looking statements” inside the that means of the Private Securities Litigation Reform Act of 1995. These forward-looking statements mirror the Company’s present views with respect to, amongst different issues, the influence of COVID-19 and potential restoration situations, the Company’s complete transformation agenda (the “Transformation Plan”), strategic planning, targets, section reporting and outlook for future reporting intervals (together with the extent and timing of income, expense and revenue traits and modifications in working money flows and money flows from working actions and investing actions), the influence of the Wella divestiture and the associated transition providers (the “Wella TSA”), the Company’s future operations and technique (together with the anticipated implementation and associated influence of its strategic priorities), ongoing and future price effectivity, optimization and restructuring initiatives and packages, strategic transactions (together with their anticipated timing and influence), the Company’s capital allocation technique and fee of dividends (together with suspension of dividend funds and the length thereof and any plans to renew money dividends or to proceed to pay dividends in money on most popular inventory) , investments, licenses and portfolio modifications, synergies, financial savings, efficiency, price, timing and integration of acquisitions, together with the strategic partnership with Kylie Jenner and the strategic partnership with Kim Kardashian West, future money flows, liquidity and borrowing capability (together with any debt refinancing actions), timing and measurement of money outflows and debt deleveraging, the timing and extent of any future impairments, and synergies, financial savings, influence, price, timing and implementation of the Company’s Transformation Plan, together with operational and organizational construction modifications, operational execution and simplification initiatives, fastened price reductions, provide chain modifications, e-commerce and digital initiatives, the anticipated influence of world provide chain challenges or inflationary pressures, and the priorities of senior administration. These forward-looking statements are typically recognized by phrases or phrases, similar to “anticipate”, “are going to”, “estimate”, “plan”, “project”, “expect”, “believe”, “intend”, “foresee”, “forecast”, “will”, “may”, “should”, “outlook”, “continue”, “temporary”, “target”, “aim”, “potential”, “goal” and comparable phrases or phrases. These statements are primarily based on sure assumptions and estimates that we take into account cheap, however are topic to a quantity of dangers and uncertainties, many of that are past our management, which might trigger precise occasions or outcomes (together with our monetary situation, outcomes of operations, money flows and prospects) to vary materially from such statements, together with dangers and uncertainties referring to:

  • the influence of COVID-19 (or future comparable occasions), together with demand for the Company’s merchandise, sickness, quarantines, authorities actions, facility closures, retailer closures or different restrictions in reference to the COVID-19 pandemic, and the extent and length thereof, the supply and widespread distribution of a secure and efficient vaccine, associated influence on the Company’s skill to fulfill buyer wants and on the power of third events on which the Company depends, together with its suppliers, prospects, contract producers, distributors, contractors, business banks and joint-venture companions, to fulfill their obligations to the Company, particularly collections from prospects, the extent that authorities funding and reimbursement packages in reference to COVID-19 can be found to the Company, and the power to efficiently implement measures to reply to such impacts;
  • the Company’s skill to efficiently implement its multi-year Transformation Plan, together with its administration realignment, reporting construction modifications, operational and organizational modifications, and the initiatives to additional cut back the Company’s price base, and to develop and obtain its world enterprise methods (together with combine administration, choose worth will increase, extra disciplined promotions, and foregoing low worth gross sales), compete successfully within the magnificence {industry}, obtain the advantages contemplated by its strategic initiatives (together with income progress, price management, gross margin progress and debt deleveraging) and efficiently implement its strategic priorities (together with innovation efficiency in status and mass channels, strengthening its positions in core markets, accelerating its digital and e-commerce capabilities, constructing on its skincare portfolio, and increasing its presence in China) in every case inside the anticipated timeframe or in any respect;
  • the Company’s skill to anticipate, gauge and reply to market traits and client preferences, which can change quickly, and the market acceptance of new merchandise, together with new merchandise associated to Kylie Jenner’s or Kim Kardashian West’s current magnificence enterprise, any relaunched or rebranded merchandise and the anticipated prices and discounting related to such relaunches and rebrands, and client receptiveness to our present and future advertising and marketing philosophy and client engagement actions (together with digital advertising and marketing and media);
  • use of estimates and assumptions in making ready the Company’s monetary statements, together with with regard to income recognition, revenue taxes (together with the anticipated timing and quantity of the discharge of any tax valuation allowance), the evaluation of goodwill, different intangible and long-lived property for impairments, the market worth of stock, the truthful worth of the fairness funding, and the truthful worth of acquired property and liabilities related to acquisitions;
  • the influence of any future impairments;
  • managerial, transformational, operational, regulatory, authorized and monetary dangers, together with diversion of administration consideration to and administration of money flows, bills and prices related to the Company’s response to COVID-19, the Transformation Plan, the Wella TSA, the combination of the King Kylie transaction and the KKW transaction, and future strategic initiatives, and, particularly, the Company’s skill to handle and execute many initiatives concurrently together with any ensuing complexity, worker attrition or diversion of assets;
  • the timing, prices and impacts of divestitures and the quantity and use of proceeds from any such transactions;
  • future divestitures and the influence thereof on, and future acquisitions, new licenses and joint ventures and the combination thereof with, our enterprise, operations, methods, monetary information and tradition and the power to understand synergies, keep away from future provide chain and different enterprise disruptions, cut back prices (together with by means of the Company’s money effectivity initiatives), keep away from liabilities and understand potential efficiencies and advantages (together with by means of our restructuring initiatives) on the ranges and on the prices and inside the time frames contemplated or in any respect;
  • elevated competitors, consolidation amongst retailers, shifts in customers’ most popular distribution and advertising and marketing channels (together with to digital and status channels), distribution and shelf-space resets or reductions, compression of go-to-market cycles, modifications in product and advertising and marketing necessities by retailers, reductions in retailer stock ranges and order lead-times or modifications in buying patterns, influence from COVID-19 on retail revenues, and different modifications within the retail, e-commerce and wholesale surroundings through which the Company does enterprise and sells its merchandise and the Company’s skill to reply to such modifications (together with its skill to broaden its digital, direct-to-consumer and e-commerce capabilities inside contemplated timeframes or in any respect);
  • the Company and its joint ventures’, enterprise companions’ and licensors’ skills to acquire, keep and shield the mental property utilized in its and their respective companies, shield its and their respective reputations (together with these of its and their executives or influencers), public goodwill, and defend claims by third events for infringement of mental property rights, and particularly in reference to the strategic partnerships with Kylie Jenner and Kim Kardashian, dangers associated to the entry into a brand new distribution channel, the potential for channel battle, dangers of retaining prospects and key workers, difficulties of integration (or the dangers related to limiting integration),skill to guard emblems and model names, litigation or investigations by governmental authorities, and modifications in regulation, rules and insurance policies that have an effect on KKW Holdings, LLC’s (“KKW Holdings”) enterprise or merchandise, together with threat that direct promoting legal guidelines and rules could also be modified, interpreted or enforced in a fashion that leads to a unfavorable influence to KKW Holdings’ enterprise mannequin, income, gross sales drive or enterprise;
  • any change to the Company’s capital allocation and/or money administration priorities, together with any change within the Company’s dividend coverage or, if the Company’s Board declares dividends, the Company’s inventory dividend reinvestment program;
  • any unanticipated issues, liabilities or integration or different challenges related to a previous or future acquired enterprise, joint ventures or strategic partnerships which might end in elevated threat or new, unanticipated or unknown liabilities, together with with respect to environmental, competitors and different regulatory, compliance or authorized issues;
  • the Company’s worldwide operations and joint ventures, together with enforceability and effectiveness of its three way partnership agreements and reputational, compliance, regulatory, financial and international political dangers, together with difficulties and prices related to sustaining compliance with a broad selection of complicated native and worldwide rules;
  • the Company’s dependence on sure licenses (particularly within the perfume class) and the Company’s skill to resume expiring licenses on favorable phrases or in any respect;
  • the Company’s dependence on entities performing outsourced capabilities, together with outsourcing of distribution capabilities, and third-party producers, logistics and provide chain suppliers, and different suppliers, together with third-party software program suppliers, web-hosting and e-commerce suppliers;
  • administrative, product growth and different difficulties in assembly the anticipated timing of market expansions, product launches, re-launches and advertising and marketing efforts, together with in reference to new merchandise associated to Kylie Jenner’s or Kim Kardashian West’s current magnificence companies;
  • world political and/or financial uncertainties, disruptions or main regulatory or coverage modifications, and/or the enforcement thereof that have an effect on the Company’s enterprise, monetary efficiency, operations or merchandise, together with the influence of Brexit (and associated enterprise or market disruption), the present U.S. administration and elections, modifications within the U.S. tax code, and up to date modifications and future modifications in tariffs, retaliatory or commerce safety measures, commerce insurance policies and different worldwide commerce rules within the U.S., the European Union and Asia and in different areas the place the Company operates;
  • foreign money trade price volatility and foreign money devaluation and/or inflation;
  • the quantity, sort, outcomes (by judgment, order or settlement) and prices of present or future authorized, compliance, tax, regulatory or administrative proceedings, investigations and/or litigation, together with litigation referring to the tender provide by Cottage Holdco B.V. (the “Cottage Tender Offer”) and product legal responsibility circumstances (together with asbestos and talc-related litigation for which indemnities and/or insurance coverage will not be accessible), distributor or licensor litigation, and litigation or investigations referring to the strategic partnerships with Kylie Jenner and Kim Kardashian West;
  • the Company’s skill to handle seasonal components and different variability and to anticipate future enterprise traits and desires;
  • disruptions in operations, gross sales and in different areas, together with as a consequence of disruptions in our provide chain, restructurings and different enterprise alignment actions, the Wella divestiture and associated carve-out and transition actions, manufacturing or data expertise methods, labor disputes, excessive climate and pure disasters, influence from COVID-19 or comparable world public well being occasions, influence of world provide chain challenges, and the influence of such disruptions on the Company’s skill to generate earnings, stabilize or develop revenues or money flows, adjust to its contractual obligations and precisely forecast demand and provide wants and/or future outcomes;
  • restrictions imposed on the Company by means of its license agreements, credit score services and senior unsecured bonds or different materials contracts, its skill to generate money move to repay, refinance or recapitalize debt and in any other case adjust to its debt devices, and modifications within the method through which the Company funds its debt and future capital wants;
  • growing dependency on data expertise, together with in consequence of distant working in response to COVID-19, and the Company’s skill to guard towards service interruptions, information corruption, cyber-based assaults or community safety breaches, together with ransomware assaults, prices and timing of implementation and effectiveness of any upgrades or different modifications to data expertise methods, and the price of compliance or the Company’s failure to adjust to any privateness or information safety legal guidelines (together with the European Union General Data Protection Regulation, the California Consumer Privacy Act and the Brazil General Data Protection Law) or to guard towards theft of buyer, worker and company delicate data;
  • the Company’s skill to draw and retain key personnel and the influence of senior administration transitions and organizational construction modifications;
  • the distribution and sale by third events of counterfeit and/or grey market variations of the Company’s merchandise;
  • the influence of the Transformation Plan in addition to the Wella Transaction on the Company’s relationships with key prospects and suppliers and sure materials contracts;
  • the Company’s relationship with Cottage Holdco B.V., because the Company’s majority stockholder, and its associates, and any associated conflicts of curiosity or litigation;
  • the Company’s relationship with KKR, whose associates KKR Rainbow Aggregator L.P. and KKR Bidco are respectively a big stockholder in Coty and an investor within the Wella Business, and any associated conflicts of curiosity or litigation;
  • future gross sales of a big quantity of shares by the Company’s majority stockholder or the notion that such gross sales might happen; and
  • different components described elsewhere on this doc and in paperwork that the Company information with the SEC now and again.

When used herein, the time period “includes” and “including” means, until the context in any other case signifies, “including without limitation”. More details about potential dangers and uncertainties that would have an effect on the Company’s enterprise and monetary outcomes is included beneath the heading “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” within the Company’s Quarterly Report on Form 10-Q for the interval ended September 30, 2021 and annual report on Form 10-Okay for the 12 months ended June 30, 2021 and different periodic stories the Company has filed and should file with the SEC now and again.

All forward-looking statements made on this launch are certified by these cautionary statements. These forward-looking statements are made solely as of the date of this launch, and the Company doesn’t undertake any obligation, aside from as could also be required by relevant regulation, to replace or revise any forward-looking or cautionary statements to mirror modifications in assumptions, the prevalence of occasions, unanticipated or in any other case, or modifications in future working outcomes over time or in any other case.

Comparisons of outcomes for present and any prior intervals are usually not supposed to precise any future traits or indications of future efficiency until expressed as such, and will solely be seen as historic information.

Non-GAAP Financial Measures

The Company operates on a worldwide foundation, with the bulk of internet revenues generated exterior of the U.S. Accordingly, fluctuations in international foreign money trade charges can have an effect on outcomes of operations. Therefore, to complement monetary outcomes introduced in accordance with GAAP, sure monetary data is introduced excluding the influence of international foreign money trade translations to offer a framework for assessing how the underlying companies carried out excluding the influence of international foreign money trade translations (“constant currency”). Constant foreign money data compares outcomes between intervals as if trade charges had remained fixed period-over-period, with the present interval’s outcomes calculated on the prior-year interval’s charges. The Company calculates fixed foreign money data by translating present and prior-period outcomes for entities reporting in currencies aside from U.S. {dollars} into U.S. {dollars} utilizing fixed international foreign money trade charges. The fixed foreign money calculations don’t alter for the influence of revaluing particular transactions denominated in a foreign money that’s totally different to the practical foreign money of that entity when trade charges fluctuate. The fixed foreign money data introduced will not be akin to equally titled measures reported by different corporations. The Company discloses the next fixed foreign money monetary measures: internet revenues, natural like-for-like (LFL) internet revenues, adjusted gross revenue and adjusted working revenue.

The Company presents period-over-period comparisons of internet revenues on a relentless foreign money foundation in addition to on an natural (LFL) foundation. The Company believes that natural (LFL) higher allows administration and traders to investigate and examine the Company’s internet revenues efficiency from interval to interval. For the intervals described on this launch, the time period “like-for-like” describes the Company’s core working efficiency, excluding the monetary influence of (i) acquired manufacturers or companies within the present 12 months interval till we’ve twelve months of comparable monetary outcomes, (ii) the divested manufacturers or companies or early terminated manufacturers, typically, within the prior 12 months non-comparable intervals, to keep up comparable monetary outcomes with the present fiscal 12 months interval and (iii) international foreign money trade translations to the extent relevant. For a reconciliation of natural (LFL) period-over-period, see the desk entitled “Reconciliation of Reported Net Revenues to Like-For-Like Net Revenues”.

The Company presents working revenue, working revenue margin, gross revenue, gross margin, efficient tax price, internet revenue, internet revenue margin, internet revenues, EBITDA, and EPS (diluted) on a non-GAAP foundation and specifies that these measures are non-GAAP by utilizing the time period “adjusted” (collectively the Adjusted Performance Measures). The reconciliations of these non-GAAP monetary measures to probably the most immediately comparable monetary measures calculated and introduced in accordance with GAAP are proven in tables beneath. These non-GAAP monetary measures shouldn’t be thought of in isolation from, or as an alternative choice to or superior to, monetary measures reported in accordance with GAAP. Moreover, these non-GAAP monetary measures have limitations in that they don’t mirror all of the gadgets related to the operations of the enterprise as decided in accordance with GAAP. Other corporations, together with corporations within the magnificence {industry}, could calculate equally titled non-GAAP monetary measures otherwise than we do, limiting the usefulness of these measures for comparative functions.

Adjusted working revenue/Adjusted EBITDA from persevering with operations excludes restructuring prices and enterprise construction realignment packages, amortization, acquisition- and divestiture-related prices and acquisition accounting impacts, stock-based compensation, and asset impairment fees and different changes as described beneath. For adjusted EBITDA, along with the previous, we exclude the adjusted depreciation as outlined beneath. We don’t take into account this stuff to be reflective of our core working efficiency because of the variability of such gadgets from period-to-period in phrases of measurement, nature and significance. They are primarily incurred to realign our working construction and combine new acquisitions, and exclude divestitures, and fluctuate primarily based on particular information and circumstances. Additionally, Adjusted internet revenue attributable to Coty Inc. and Adjusted internet revenue attributable to Coty Inc. per widespread share are adjusted for sure curiosity and different (revenue) expense and deemed most popular inventory dividends, as described beneath, and the associated tax results of every of the gadgets used to derive Adjusted internet revenue as such fees are usually not utilized by our administration in assessing our working efficiency period-to-period.

Adjusted Performance Measures mirror changes primarily based on the next gadgets:

  • Costs associated to acquisition and divestiture actions: The Company excludes acquisition- and divestiture-related prices and the accounting impacts similar to these associated to transaction prices and prices related to the revaluation of acquired stock in reference to enterprise mixtures as a result of these prices are distinctive to every transaction. Additionally, for divestitures, the Company excludes write-offs of property which can be not recoverable and contract associated prices because of the divestiture. The nature and quantity of such prices range considerably primarily based on the scale and timing of the acquisitions and divestitures, and the maturities of the companies being acquired or divested. Also, the scale, complexity and/or quantity of previous transactions, which frequently drives the magnitude of such bills, will not be indicative of the scale, complexity and/or quantity of any future acquisitions or divestitures.
  • Restructuring and different enterprise realignment prices: The Company excludes prices related to restructuring and enterprise construction realignment packages to permit for comparable monetary outcomes to historic operations and forward-looking steering. In addition, the character and quantity of such fees range considerably primarily based on the scale and timing of the packages. By excluding the referenced bills from the non-GAAP monetary measures, administration is ready to additional consider the Company’s skill to make the most of current property and estimate their long-term worth. Furthermore, administration believes that the adjustment of this stuff complement the GAAP data with a measure that can be utilized to evaluate the sustainability of the Company’s working efficiency.
  • Asset impairment fees: The Company excludes the influence of asset impairments as such non-cash quantities are inconsistent in quantity and frequency and are considerably impacted by the timing and/or measurement of acquisitions. Our administration believes that the adjustment of this stuff complement the GAAP data with a measure that can be utilized to evaluate the sustainability of our working efficiency.
  • Amortization expense: We have excluded the influence of amortization of finite-lived intangible property, as such non-cash quantities are inconsistent in quantity and frequency and are considerably impacted by the timing and/or measurement of acquisitions. Our administration believes that the adjustment of this stuff complement the GAAP data with a measure that can be utilized to evaluate the sustainability of our working efficiency. Although we exclude amortization of intangible property from our non-GAAP bills, our administration believes that it will be important for traders to grasp that such intangible property contribute to income era. Amortization of intangible property that relate to previous acquisitions will recur in future intervals till such intangible property have been absolutely amortized. Any future acquisitions could outcome within the amortization of extra intangible property.
  • Loss/(Gain) on divestitures and sale of model property: The Company excludes the influence of Loss/(achieve) on divestitures and sale of model property as such quantities are inconsistent in quantity and frequency and are considerably impacted by the scale of divestitures. Our administration believes that the adjustment of this stuff complement the GAAP data with a measure that can be utilized to evaluate the sustainability of our working efficiency.
  • Stock-based compensation: Although stock-based compensation is a key incentive provided to our workers, we’ve excluded the impact of these bills from the calculation of adjusted working revenue and adjusted EBITDA. This is because of their primarily non-cash nature; as well as, the quantity and timing of these bills could also be extremely variable and unpredictable, which can negatively have an effect on comparability between intervals.
  • Depreciation and Adjusted depreciation: Our adjusted working revenue excludes the influence of accelerated depreciation for sure restructuring tasks that have an effect on the anticipated helpful lives of Property, Plant and Equipment, as such fees range considerably primarily based on the scale and timing of the packages. Further, we’ve excluded adjusted depreciation, which represents depreciation expense internet of accelerated depreciation fees, from our adjusted EBITDA. Our administration believes that the adjustment of this stuff complement the GAAP data with a measure that can be utilized to evaluate the sustainability of our working efficiency.
  • Other (revenue) expense: We have excluded the write-off of deferred financing charges and reductions that resulted from the pay down of our time period debt from the proceeds of the Wella sale, because of the necessities of the 2018 Coty Credit Agreement, as amended. Our administration believes these prices don’t mirror our underlying ongoing enterprise, and the adjustment of such prices helps traders and others examine and analyze efficiency from interval to interval. We have additionally excluded the influence of pension curtailment (features) and losses and pension settlements as such occasions are triggered by our restructuring and different enterprise realignment actions and the quantity of such fees range considerably primarily based on the scale and timing of the packages. Further, we’ve excluded the change in truthful worth of the funding in Wella, as our administration believes these unrealized (features) and losses don’t mirror our underlying ongoing enterprise, and the adjustment of such influence helps traders and others examine and analyze efficiency from interval to interval.
  • Noncontrolling curiosity: This adjustment represents the after-tax influence of the non-GAAP changes included in Net revenue attributable to noncontrolling pursuits primarily based on the related non-controlling curiosity proportion.
  • Tax: This adjustment represents the influence of the tax impact of the pretax gadgets excluded from Adjusted internet revenue. The tax influence of the non-GAAP changes relies on the tax charges associated to the jurisdiction through which the adjusted gadgets are acquired or incurred. Additionally, changes are made for the tax influence of any intra-entity switch of property and liabilities.
  • Deemed Preferred Stock Dividends: We have excluded most popular inventory deemed dividends associated to the Exchange Agreement from our calculation of adjusted internet revenue attributable to Coty Inc. These deemed dividends are non-monetary in nature and don’t mirror our underlying ongoing enterprise. Management believes that this adjustment helps traders and others examine and analyze our efficiency from interval to interval.

The Company has supplied a quantitative reconciliation of the distinction between the non-GAAP monetary measures and the monetary measures calculated and reported in accordance with GAAP. For a reconciliation of adjusted gross revenue to gross revenue, adjusted EPS (diluted) to EPS (diluted), and adjusted internet revenues to internet revenues, see the desk entitled “Reconciliation of Reported to Adjusted Results for the Consolidated Statements of Operations.” For a reconciliation of adjusted working revenue to working revenue and adjusted working revenue margin to working revenue margin, see the tables entitled “Reconciliation of Reported Operating Income (Loss) to Adjusted Operating Income” and “Reconciliation of Reported Operating Income (Loss) to Adjusted Operating Income by Segment.” For a reconciliation of adjusted efficient tax price to efficient tax price, see the desk entitled “Reconciliation of Reported Income (Loss) Before Income Taxes and Effective Tax Rates to Adjusted Income Before Income Taxes and Adjusted Effective Tax Rates.” For a reconciliation of adjusted internet revenue and adjusted internet revenue margin to internet revenue (loss), see the desk entitled “Reconciliation of Reported Net Income (Loss) to Adjusted Net Income.”

The Company additionally presents free money move, adjusted earnings earlier than curiosity, taxes, depreciation and amortization (“adjusted EBITDA”), rapid liquidity, Financial Net Debt and Economic Net Debt. Management believes that these measures are helpful for traders as a result of it gives them with an essential perspective on the money accessible for debt reimbursement and different strategic measures and gives them with the identical measures that administration makes use of as the idea for making useful resource allocation selections. Free money move is outlined as internet money supplied by working actions much less capital expenditures; adjusted EBITDA is outlined as adjusted working revenue, excluding adjusted depreciation and non-cash stock-based compensation. Net debt or Financial Net Debt (which the Company known as “internet debt” in prior reporting intervals) is outlined as whole debt much less money and money equivalents, and Economic Net Debt is outlined as whole debt much less money and money equivalents much less the worth of the Wella Stake. For a reconciliation of Free Cash Flow, see the desk entitled “Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow,” for adjusted EBITDA, see the desk entitled “Reconciliation of Adjusted Operating Income to Adjusted EBITDA” and for Financial Net Debt and Economic Net Debt, see the tables entitled “Reconciliation of Total Debt to Financial Net Debt and Economic Net Debt.” Further, our rapid liquidity is outlined because the sum of accessible money and money equivalents and accessible borrowings beneath our Revolving Credit Facility (please see desk “Immediate Liquidity”).

These non-GAAP measures shouldn’t be thought of in isolation, or as an alternative choice to, or superior to, monetary measures calculated in accordance with GAAP.

To the extent that the Company gives steering, it does so solely on a non-GAAP foundation and doesn’t present reconciliations of such forward-looking non-GAAP measures to GAAP because of the inherent problem in forecasting and quantifying sure quantities which can be needed for such reconciliation, together with changes that could possibly be made for restructuring, integration and acquisition-related bills, amortization bills, non-cash stock-based compensation, changes to stock, and different fees mirrored in our reconciliation of historic numbers, the quantity of which, primarily based on historic expertise, could possibly be important.

– Tables Follow –

COTY INC.

SUPPLEMENTAL SCHEDULES INCLUDING NON-GAAP FINANCIAL MEASURES(a)

 

RESULTS AT A GLANCE

 

 

Three Months Ended September 30,

2021

(in hundreds of thousands, besides per share information)

 

 

 

Change YoY

 

CONTINUING OPERATIONS

 

 

 

Reported Basis

 

(LFL)

Net revenues

 

$

1,371.7

 

 

22

%

 

21

%

Operating revenue – reported

 

17.2

 

 

>100

%

 

 

Operating revenue – adjusted*

 

200.5

 

 

>100

%

 

 

EBITDA – adjusted

 

278.5

 

 

67

%

 

 

Net revenue attributable to widespread shareholders – reported**

 

103.0

 

 

7

%

 

 

Net revenue attributable to widespread shareholders – adjusted* **

 

63.1

 

 

>100

%

 

 

EPS attributable to widespread shareholders (diluted) – reported

 

$

0.13

 

 

%

 

 

EPS attributable to widespread shareholders (diluted) – adjusted*

 

$

0.08

 

 

>100

%

 

 

 

 

 

 

 

 

 

COTY, INC.

 

 

 

 

 

 

Net revenue attributable to widespread shareholders – reported **

 

103.0

 

 

(49

%)

 

 

Net revenue attributable to widespread shareholders – adjusted* **

 

63.1

 

 

(31

%)

 

 

EPS attributable to widespread shareholders (diluted) – reported

 

$

0.13

 

 

(46

%)

 

 

EPS attributable to widespread shareholders (diluted) – adjusted*

 

$

0.08

 

 

(33

%)

 

 

* These measures, in addition to “free cash flow,” “adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA),” “rapid liquidity,” “financial net debt,” and “financial internet debt” are Non-GAAP Financial Measures. Refer to “Non-GAAP Financial Measures” for dialogue of these measures. Reconciliations from reported to adjusted outcomes will be discovered on the finish of this launch.

** Net revenue for Continuing Operations and Coty Inc. are internet of the Convertible Series B Preferred Stock dividends.

FIRST QUARTER BY SEGMENT (CONTINUING OPERATIONS)

 

 

Three Months Ended September 30,

 

 

 

 

Net Revenues

 

Change

Reported Operating Income (Loss)

 

Adjusted Operating Income

(in hundreds of thousands)

 

2021

 

2020

 

Reported

Basis

 

LFL

 

2021

 

Change

 

Margin

 

2021

 

Change

 

Margin

Prestige

 

$

870.7

 

 

$

644.4

 

 

35

%

 

34

%

 

$

132.1

 

 

>100

%

 

15

%

 

$

177.0

 

 

>100%

 

20

%

Consumer Beauty

 

501.0

 

 

479.7

 

 

4

%

 

3

%

 

11.4

 

 

>100

%

 

2

%

 

23.5

 

 

N/A

 

5

%

Corporate

 

 

 

 

 

N/A

 

N/A

 

(126.3

)

 

(46

%)

 

N/A

 

 

 

N/A

 

N/A

Total

 

$

1,371.7

 

 

$

1,124.1

 

 

22

%

 

21

%

 

$

17.2

 

 

>100

%

 

1

%

 

$

200.5

 

 

>100%

 

15

%

 

(a) As beforehand disclosed, we’ve realigned our reportable segments to a principally product category-based construction, comprised of a Prestige enterprise section and a Consumer Beauty enterprise section. In addition, we’ve amended the definition of inventory compensation expense to be used in sure Non-GAAP Financial Measures. In order to mirror these modifications, the Company has recast reported internet income by section, reported working revenue (loss) by section, adjusted working revenue (loss) by section and whole, adjusted EBITDA by section, and whole adjusted revenue (loss) earlier than revenue taxes and whole adjusted internet revenue (loss) from persevering with operations for all comparative intervals proven.

 

 

Adjusted EBITDA

 

 

Three Months Ended

September 30,

(in hundreds of thousands)

 

2021

 

2020

Prestige

 

$

215.0

 

 

$

119.8

 

Consumer Beauty

 

63.5

 

 

46.8

 

Corporate

 

 

 

 

Total

 

$

278.5

 

 

$

166.6

 

FIRST QUARTER FISCAL 2022 BY REGION

 

Continuing Operations

 

 

Three Months Ended September 30,

 

 

Net Revenues

 

Change

(in hundreds of thousands)

 

2021

 

2020

 

Reported

Basis

 

LFL

Americas

 

$

581.5

 

 

$

470.6

 

 

24

%

 

23

%

EMEA

 

627.1

 

 

530.4

 

 

18

%

 

17

%

Asia Pacific

 

163.1

 

 

123.1

 

 

32

%

 

29

%

Total

 

$

1,371.7

 

 

$

1,124.1

 

 

22

%

 

21

%

COTY INC. & SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 

Three Months Ended

September 30,

(in hundreds of thousands, besides per share information)

2021

 

2020

Net revenues

$

1,371.7

 

 

 

$

1,124.1

 

 

Cost of gross sales

504.8

 

 

 

464.9

 

 

as % of Net revenues

36.8

 

%

 

41.4

 

%

Gross revenue

866.9

 

 

 

659.2

 

 

Gross margin

63.2

 

%

 

58.6

 

%

 

 

 

 

Selling, basic and administrative bills

776.3

 

 

 

583.4

 

 

as % of Net revenues

56.6

 

%

 

51.9

 

%

Amortization expense

57.0

 

 

 

65.4

 

 

Restructuring prices

12.4

 

 

 

30.1

 

 

Acquisition-and divestiture- associated prices

4.0

 

 

 

46.3

 

 

Operating revenue (loss)

17.2

 

 

 

(66.0

)

 

as % of Net revenues

1.3

 

%

 

(5.9

 

%)

Interest expense, internet

59.8

 

 

 

62.1

 

 

Other revenue, internet

(386.1

)

 

 

(5.8

)

 

Income (loss) from persevering with operations earlier than revenue taxes

343.5

 

 

 

(122.3

)

 

as % of Net revenues

25.0

 

%

 

(10.9

 

%)

Provision (profit) for revenue taxes on persevering with operations

114.6

 

 

 

(244.9

)

 

Net revenue from persevering with operations

228.9

 

 

 

122.6

 

 

as % of Net revenues

16.7

 

%

 

10.9

 

%

Net revenue from discontinued operations

 

 

 

104.7

 

 

Net revenue

228.9

 

 

 

227.3

 

 

Net (loss) revenue attributable to noncontrolling pursuits

(0.5

)

 

 

0.4

 

 

Net revenue attributable to redeemable noncontrolling pursuits

3.4

 

 

 

5.5

 

 

Net revenue attributable to Coty Inc.

$

226.0

 

 

 

$

221.4

 

 

Amounts attributable to Coty Inc.

 

 

 

Net revenue from persevering with operations

$

226.0

 

 

 

$

116.7

 

 

Convertible Series B Preferred Stock dividends

(123.0

)

 

 

(20.8

)

 

Net revenue from persevering with operations attributable to widespread stockholders

$

103.0

 

 

 

$

95.9

 

 

Net revenue from discontinued operations

 

 

 

104.7

 

 

Net revenue attributable to widespread stockholders

$

103.0

 

 

 

$

200.6

 

 

 

 

 

 

Earnings per widespread share:

 

 

 

Basic for Continuing Operations

$

0.13

 

 

 

$

0.13

 

 

Diluted for Continuing Operations(a)

$

0.13

 

 

 

$

0.13

 

 

Basic for Coty Inc.

$

0.13

 

 

 

$

0.26

 

 

Diluted for Coty Inc.(a)

$

0.13

 

 

 

$

0.24

 

 

Weighted-average widespread shares excellent:

 

 

 

Basic

777.6

 

 

 

763.9

 

 

Diluted(a)

787.7

 

 

 

916.7

 

 

 

 

 

 

Depreciation – Continuing Operations

$

80.8

 

 

 

$

80.9

 

 

(a)

Diluted EPS is adjusted by the impact of dilutive securities, together with awards beneath our fairness compensation plans and the convertible Series B Preferred Stock. When calculating any potential dilutive impact of inventory choices, Series A Preferred Stock, restricted inventory and RSUs we use the treasury methodology and the if-converted methodology for the Convertible Series B Preferred Stock. The treasury methodology usually doesn’t alter the web revenue attributable to Coty Inc., whereas the if-converted methodology requires an adjustment to reverse the influence of the popular inventory dividends of $123.0 million and $20.8 million for the three months ended September 30, 2021 and 2020, respectively, on internet revenue relevant to widespread stockholders throughout the interval.

RECONCILIATION OF REPORTED TO ADJUSTED RESULTS FOR THE CONSOLIDATED STATEMENTS OF OPERATIONS

These supplemental schedules present adjusted Non-GAAP monetary data and a quantitative reconciliation of the distinction between the Non-GAAP monetary measure and the monetary measure calculated and reported in accordance with GAAP.

 

Three Months Ended September 30, 2021

 

 

 

CONTINUING OPERATIONS

 

 

(in hundreds of thousands)

Reported

(GAAP)

 

Adjustments(a)

 

Adjusted

(Non-GAAP)

 

 

Net revenues

$

1,371.7

 

 

 

$

 

 

$

1,371.7

 

 

 

 

Gross revenue

866.9

 

 

 

2.7

 

 

869.6

 

 

 

 

Gross margin

63.2

 

%

 

 

 

63.4

 

%

 

 

Operating revenue

17.2

 

 

 

183.3

 

 

200.5

 

 

 

 

as % of Net revenues

1.3

 

%

 

 

 

14.6

 

%

 

 

Net revenue

103.0

 

 

 

(39.9

)

 

63.1

 

 

 

 

as % of Net revenues

7.5

 

%

 

 

 

4.6

 

%

 

 

Adjusted EBITDA

 

 

 

 

278.5

 

 

 

 

as % of Net revenues

 

 

 

 

20.3

 

%

 

 

 

COTY INC.

 

 

Net revenue attributable to Coty Inc.

103.0

 

 

 

(39.9

)

 

63.1

 

 

 

 

 

 

 

 

 

 

 

 

EPS (diluted)

$

0.13

 

 

 

 

 

$

0.08

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended September 30, 2020

(in hundreds of thousands)

Reported

(GAAP)

 

Adjustments(a)

 

Adjusted

(Non-GAAP)

 

Discontinued

Operations

Adjusted

(Non-GAAP)

Net revenues

$

1,124.1

 

 

 

$

 

 

$

1,124.1

 

 

 

$

566.4

 

Gross revenue

659.2

 

 

 

 

 

659.2

 

 

 

385.4

 

Gross margin

58.6

 

%

 

 

 

58.6

 

%

 

68.0

%

Operating (loss) revenue

(66.0

)

 

 

151.7

 

 

85.7

 

 

 

146.8

 

as % of Net revenues

(5.9

 

%)

 

 

 

7.6

 

%

 

26.0

%

Net revenue (loss)

95.9

 

 

 

(105.7

)

 

(9.8

)

 

 

101.1

 

as % of Net revenues

8.5

 

%

 

 

 

(0.9

 

%)

 

17.8

%

Adjusted EBITDA

 

 

 

 

166.6

 

 

 

146.8

 

as % of Net revenues

 

 

 

 

14.8

 

%

 

25.9

%

 

COTY INC.

 

 

Net revenue attributable to Coty Inc.

200.6

 

 

 

(109.3

)

 

91.3

 

 

 

 

 

 

 

 

 

 

 

 

EPS (diluted)

$

0.24

 

 

 

 

 

$

0.12

 

 

 

 

 

 

 

 

 

 

 

 

(a) See “Reconciliation of Reported Operating (Loss) Income to Adjusted Operated Income” and “Reconciliation of Reported Net (Loss) Income to Adjusted Net Income” for an in depth description of adjusted gadgets.

RECONCILIATION OF REPORTED OPERATING (LOSS) INCOME TO ADJUSTED OPERATING INCOME AND ADJUSTED EBITDA

 

CONTINUING OPERATIONS

 

Three Months Ended September 30,

(in hundreds of thousands)

 

2021

 

2020

 

Change

Reported Operating revenue (loss)

 

$

17.2

 

 

$

(66.0

)

 

 

>100

%

% of Net revenues

 

1.3

%

 

(5.9

 

%)

 

 

Amortization expense (a)

 

57.0

 

 

65.4

 

 

 

(13

%)

Restructuring and different enterprise realignment prices (b)

 

14.1

 

 

34.4

 

 

 

(59

%)

Stock-based compensation (c)

 

108.2

 

 

5.6

 

 

 

>100

%

Acquisition- and divestiture-related prices (d)

 

4.0

 

 

46.3

 

 

 

(91

%)

Total changes to reported working revenue (loss)

 

183.3

 

 

151.7

 

 

 

21

%

Adjusted Operating revenue

 

$

200.5

 

 

$

85.7

 

 

 

>100

%

% of Net revenues

 

14.6

%

 

7.6

 

%

 

 

Adjusted depreciation (e)

 

78.0

 

 

80.9

 

 

 

(4

%)

Adjusted EBITDA

 

$

278.5

 

 

$

166.6

 

 

 

67

%

% of Revenues

 

20.3

%

 

14.8

 

%

 

 

(a)

In the three months ended September 30, 2021, amortization expense of $44.9 and $12.1 was reported within the Prestige and Consumer Beauty segments, respectively. In the three months ended September 30, 2020, amortization expense of $51.7 and $13.7 was reported within the Prestige and Consumer Beauty segments, respectively.

(b)

In the three months ended September 30, 2021, we incurred restructuring and different enterprise construction realignment prices of $14.1. We incurred restructuring prices of $12.4 primarily associated to the Transformation Plan, included within the Condensed Consolidated Statements of Operations; and enterprise construction realignment prices of $1.7 primarily associated to the Transformation Plan and sure different packages. This quantity contains $(1.0) reported in promoting, basic and administrative bills, and $2.7 reported in price of gross sales within the Condensed Consolidated Statement of Operations. In the three months ended September 30, 2020, we incurred restructuring and different enterprise construction realignment prices of $34.4. We incurred restructuring prices of $30.1 primarily associated to the Transformation Plan, included within the Condensed Consolidated Statements of Operations; and enterprise construction realignment prices of $4.3 primarily associated to the Transformation Plan and sure different packages. This quantity contains $4.3 reported in promoting, basic and administrative bills, and nil reported in price of gross sales within the Condensed Consolidated Statement of Operations.

(c)

In the three months ended September 30, 2021, stock-based compensation was $108.2 as in contrast with $5.6 within the three months ended September 30, 2020. The enhance in stock-based compensation is primarily associated to the CEO grant made on June 30, 2021.

(d)

In the three months ended September 30, 2021 and September 30, 2020, we incurred acquisition- and divestiture-related prices of $4.0 and $46.3, respectively. These prices had been primarily related to the Wella Transaction.

(e)

In the three months ended September 30, 2021, adjusted depreciation expense of $38.0 and $40.0 was reported within the Prestige and Consumer Beauty segments, respectively. In the three months ended September 30, 2020, adjusted depreciation expense of $34.1 and $46.8 was reported within the Prestige and Consumer Beauty segments, respectively.

RECONCILIATION OF REPORTED INCOME (LOSS) BEFORE INCOME TAXES AND EFFECTIVE TAX RATES TO ADJUSTED INCOME BEFORE INCOME TAXES AND ADJUSTED EFFECTIVE TAX RATES FOR CONTINUING OPERATIONS

 

 

Three Months Ended September 30, 2021

 

Three Months Ended September 30, 2020

(in hundreds of thousands)

 

(Loss)

revenue

earlier than

revenue

taxes

 

(Benefit)

Provision

for

revenue

taxes

 

Effective tax

price

 

(Loss)

revenue

earlier than

revenue

taxes

 

Provision

for

revenue

taxes

 

Effective tax

price

Reported Income (Loss) earlier than revenue taxes – Continuing Operations

 

$

343.5

 

 

$

114.6

 

 

33.4

%

 

$

(122.3

)

 

$

(244.9

)

 

200.2

%

Adjustments to Reported Operating Income (a)

 

183.3

 

 

 

 

 

 

151.7

 

 

 

 

 

Change in truthful worth of funding in Wella Business (c)

 

(390.0

)

 

 

 

 

 

 

 

 

 

 

Other changes (d)

 

0.2

 

 

 

 

 

 

(5.3

)

 

 

 

 

Total Adjustments (b) (e)

 

(206.5

)

 

(74.8

)

 

 

 

146.4

 

 

250.9

 

 

 

Adjusted Income earlier than revenue taxes – Continuing Operations

 

$

137.0

 

 

$

39.8

 

 

29.1

%

 

$

24.1

 

 

$

6.0

 

 

24.9

%

The adjusted efficient tax price was 29.1% for the three months ended September 30, 2021 in comparison with 24.9% for the three months ended September 30, 2020. The distinction was primarily because of the jurisdictional combine of revenue.

 

(a)

See an outline of changes beneath “Adjusted Operating (Loss) Income for Continuing Operations.”

(b)

The tax results of every of the gadgets included in adjusted revenue are calculated in a fashion that leads to a corresponding revenue tax expense/provision for adjusted revenue. In making ready the calculation, every adjustment to reported revenue is first analyzed to find out if the adjustment has an revenue tax consequence. The provision for taxes is then calculated primarily based on the jurisdiction through which the adjusted gadgets are incurred, multiplied by the respective statutory charges and offset by the rise or reversal of any valuation allowances commensurate with the non-GAAP measure of profitability.

(c)

The quantity represents the unrealized achieve acknowledged for the change within the truthful worth of the funding in Wella.

(d)

For the three months ended September 30, 2021, this primarily represents the loss from the fairness funding in KKW. For the three months ended September 30, 2020, this primarily represents the pension curtailment achieve.

(e)

The whole tax influence on changes within the prior interval features a $220.5 profit recorded because the outcome of a tax price differential on the deferred taxes acknowledged on the switch of property and liabilities, following the relocation of our primary principal location from Geneva to Amsterdam on July 1, 2020.

RECONCILIATION OF REPORTED NET INCOME TO ADJUSTED NET INCOME (LOSS) FOR CONTINUING OPERATIONS

 

Three Months Ended September 30,

(in hundreds of thousands)

2021

 

2020

 

Change

Net revenue from Continuing Operations, internet of noncontrolling pursuits

$

226.0

 

 

 

$

116.7

 

 

 

94

%

Convertible Series B Preferred Stock dividends (c)

(123.0

)

 

 

(20.8

)

 

 

%)

Reported Net revenue attributable to Continuing Operations

$

103.0

 

 

 

$

95.9

 

 

 

7

%

% of Net revenues

7.5

 

%

 

8.5

 

%

 

 

Adjustments to Reported Operating Income (a)

183.3

 

 

 

151.7

 

 

 

21

%

Change in truthful worth of funding in Wella Business (d)

(390.0

)

 

 

 

 

 

N/A

Adjustments to different (revenue) expense (e)

0.2

 

 

 

(5.3

)

 

 

>100

%

Adjustments to noncontrolling curiosity expense (b)

(1.8

)

 

 

(1.2

)

 

 

(50

%)

Change in tax provision as a consequence of changes to Reported Net revenue attributable to Continuing Operations

74.8

 

 

 

(250.9

)

 

 

>100

%

Adjustment for deemed Series B Preferred Stock dividends associated to the Exchange Agreement (c) (f)

93.6

 

 

 

 

 

 

N/A

Adjusted Net revenue (loss) attributable to Continuing Operations

$

63.1

 

 

 

$

(9.8

)

 

 

>100

%

% of Net revenues

4.6

 

%

 

(0.9

 

%)

 

 

 

 

 

 

 

 

Per Share Data

 

 

 

 

 

Adjusted weighted-average widespread shares

 

 

 

 

 

Basic

777.6

 

 

 

763.9

 

 

 

 

Diluted (c) (f)

787.7

 

 

 

763.9

 

 

 

 

Adjusted Net revenue (loss) attributable to Continuing Operations per Common Share

 

 

 

 

 

Basic

$

0.08

 

 

 

$

(0.01

)

 

 

 

Diluted (c)

$

0.08

 

 

 

$

(0.01

)

 

 

 

(a)

See an outline of changes beneath “Adjusted Operating Income for Continuing Operations.”

(b)

The quantities symbolize the after-tax influence of the non-GAAP changes included in Net revenue attributable to noncontrolling curiosity primarily based on the related noncontrolling curiosity proportion within the Condensed Consolidated Statements of Operations.

(c)

Adjusted Diluted EPS is adjusted by the impact of dilutive securities, together with awards beneath our fairness compensation plans and the convertible Series B Preferred Stock. For each intervals introduced, the convertible Series B Preferred Stock was antidilutive. Accordingly, we excluded the convertible Series B Preferred Stock from the diluted shares and didn’t alter the earnings for the associated dividend.

(d)

The quantity represents the unrealized achieve acknowledged for the change within the truthful worth of the funding in Wella.

(e)

For the three months ended September 30, 2021, this primarily represents the loss from fairness funding in KKW. For the three months ended September 30, 2020, this primarily represents the pension curtailment achieve.

(f)

This adjustment represents the deemed dividend that was brought on by the getting into into the Exchange Agreement on September 30, 2021. The deemed dividend is the distinction between the carrying worth and the truthful worth of the Convertible Series B Preferred Stock to be exchanged.

RECONCILIATION OF REPORTED NET INCOME TO ADJUSTED NET INCOME FOR COTY INC.

 

Three Months Ended September 30,

(in hundreds of thousands)

2021

 

2020

 

Change

Net revenue from Coty Inc. internet of noncontrolling pursuits

$

226.0

 

 

 

$

221.4

 

 

 

2

 

%

Convertible Series B Preferred Stock dividends (c)

(123.0

)

 

 

(20.8

)

 

 

%)

Reported Net revenue attributable to Coty Inc.

$

103.0

 

 

 

$

200.6

 

 

 

(49

 

%)

% of Net revenues

7.5

 

%

 

11.9

 

%

 

 

Adjustments to Reported Operating revenue (a)

183.3

 

 

 

153.1

 

 

 

20

 

%

Change in truthful worth of funding in Wella Business (d)

(390.0

)

 

 

 

 

 

N/A

Adjustments to different (revenue) expense (e)

0.2

 

 

 

(5.3

)

 

 

>100

%

Adjustments to noncontrolling curiosity expense (b)

(1.8

)

 

 

(1.2

)

 

 

(50

)

%

Change in tax provision as a consequence of changes to Reported Net revenue (loss) attributable to Coty Inc.

74.8

 

 

 

(255.9

)

 

 

>100

%

Adjustment for deemed Series B Preferred Stock dividends associated to the Exchange Agreement (c) (f)

93.6

 

 

 

 

 

 

N/A

Adjusted Net revenue attributable to Coty Inc.

$

63.1

 

 

 

$

91.3

 

 

 

(31

)

%

 

 

 

 

 

 

Per Share Data

 

 

 

 

 

Adjusted weighted-average widespread shares

 

 

 

 

 

Basic

777.6

 

 

 

763.9

 

 

 

 

Diluted (c) (f)

787.7

 

 

 

763.9

 

 

 

 

Adjusted Net revenue attributable to Coty Inc. per Common Share

 

 

 

 

 

Basic

$

0.08

 

 

 

$

0.12

 

 

 

 

Diluted (c)

$

0.08

 

 

 

$

0.12

 

 

 

 

(a)

See an outline of changes beneath “Adjusted Operating Income (loss) for Coty Inc.”

(b)

The quantities symbolize the after-tax influence of the non-GAAP changes included in Net revenue attributable to noncontrolling curiosity primarily based on the related noncontrolling curiosity proportion within the Condensed Consolidated Statements of Operations.

(c)

Adjusted Diluted EPS is adjusted by the impact of dilutive securities, together with awards beneath our fairness compensation plans and the convertible Series B Preferred Stock. For each intervals introduced, the convertible Series B Preferred Stock was antidilutive. Accordingly, we excluded the convertible Series B Preferred Stock from the diluted shares and didn’t alter the earnings for the associated dividend.

(d)

The quantity represents the unrealized achieve acknowledged for the change within the truthful worth of the funding in Wella.

(e)

For the three months ended September 30, 2021, this primarily represents adjustment for the change within the truthful worth of funding in KKW.

(f)

This adjustment represents the deemed dividend that was brought on by the getting into into the Exchange Agreement on September 30, 2021. The deemed dividend is the distinction between the carrying worth and the truthful worth of the Convertible Series B Preferred Stock to be exchanged.

RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW

COTY INC.

 

Three Months Ended September

30,

(in hundreds of thousands)

 

2021

 

2020

Net money supplied by working actions

 

$

285.7

 

 

$

42.6

 

Capital expenditures

 

(45.0

)

 

(70.9

)

Free money move

 

$

240.7

 

 

$

(28.3

)

RECONCILIATION OF TOTAL DEBT TO ECONOMIC NET DEBT

COTY INC.

As of

(in hundreds of thousands)

September 30, 2021

Total debt

$

5,332.0

Less: Cash and money equivalents

 

376.9

Financial Net debt

$

4,955.1

Less Value of Wella stake

 

1,650.0

Economic Net debt

$

3,305.1

 
 

IMMEDIATE LIQUIDITY

COTY INC.

As of

(in hundreds of thousands)

September 30, 2021

Cash and money equivalents

$

376.9

Unutilized revolving credit score facility

 

2,149.9

Immediate Liquidity

$

2,526.8

 
 

RECONCILIATION OF ADJUSTED OPERATING INCOME TO ADJUSTED EBITDA

 

Twelve months ended

 

September 30, 2021

(in hundreds of thousands)

CONTINUING

OPERATIONS

Adjusted working revenue (a)

$

551.0

Add: Adjusted depreciation(b)

 

322.9

Adjusted EBITDA

$

873.9

(a)

Adjusted working revenue (loss) for the twelve months ended September 30, 2021 represents the summation of the adjusted working revenue (loss) for every of the quarters ended December 31, 2020, March 31, 2021, June 30, 2021 and September 30, 2021. For a reconciliation of adjusted working revenue (loss) to working revenue (loss) for every of these intervals, see the desk entitled “Reconciliation of Reported Operating Income (loss) to Adjusted Operating Income (loss)” for every of these intervals.

(b)

Adjusted depreciation for the twelve months ended September 30, 2021 represents depreciation expense for persevering with operations for the interval, excluding accelerated depreciation.

FINANCIAL NET DEBT/ADJUSTED EBITDA

 

 

September 30, 2021

Financial Net Debt – Coty Inc.

 

$

4,955.1

 

Adjusted EBITDA – Continuing operations

 

873.9

 

Financial Net Debt/Adjusted EBITDA

 

5.67

 

RECONCILIATION OF REPORTED NET REVENUES TO LIKE-FOR-LIKE NET REVENUES

 

 

 

Three Months Ended September 30, 2021 vs. Three Months Ended September 30, 2020

Net Revenue Change

Net Revenues Change YoY

 

Reported Basis

 

Constant Currency

 

Impact from Acquisitions

and Divestitures

 

LFL

Prestige

 

35

%

 

34

%

 

%

 

34

%

Consumer Beauty

 

4

%

 

3

%

 

%

 

3

%

Total Continuing Operations

 

22

%

 

21

%

 

%

 

21

%

COTY INC. & SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

 

(in hundreds of thousands)

 

September 30,

2021

 

June 30,

2021

ASSETS

 

 

 

 

Current property:

 

 

 

 

Cash and money equivalents

 

$

376.9

 

 

$

253.5

 

Restricted money

 

45.5

 

 

56.9

 

Trade receivables, internet

 

517.8

 

 

348.0

 

Inventories

 

660.7

 

 

650.8

 

Prepaid bills and different present property

 

459.3

 

 

473.9

 

Total present property

 

2,060.2

 

 

1,783.1

 

Property and gear, internet

 

847.1

 

 

918.1

 

Goodwill

 

4,037.4

 

 

4,118.1

 

Other intangible property, internet

 

4,336.0

 

 

4,463.0

 

Equity investments

 

1,665.6

 

 

1,276.2

 

Operating lease right-of-use property

 

302.6

 

 

318.5

 

Other noncurrent property

 

789.5

 

 

814.4

 

TOTAL ASSETS

 

$

14,038.4

 

 

$

13,691.4

 

 

 

 

 

 

LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable

 

$

1,232.5

 

 

$

1,166.1

 

Mandatorily redeemable Convertible Series B Preferred Stock

 

394.2

 

 

 

Short-term debt and present portion of long-term debt

 

24.0

 

 

24.2

 

Other present liabilities

 

1,421.1

 

 

1,225.1

 

Total present liabilities

 

3,071.8

 

 

2,415.4

 

Long-term debt, internet

 

5,250.0

 

 

5,401.0

 

Long-term working lease liabilities

 

257.8

 

 

269.3

 

Other noncurrent liabilities

 

1,477.5

 

 

1,423.1

 

TOTAL LIABILITIES

 

10,057.1

 

 

9,508.8

 

 

 

 

 

 

CONVERTIBLE SERIES B PREFERRED STOCK

 

453.7

 

 

1,036.3

 

REDEEMABLE NONCONTROLLING INTERESTS

 

83.4

 

 

84.1

 

Total Coty Inc. stockholders’ fairness

 

3,243.4

 

 

2,860.7

 

Noncontrolling pursuits

 

200.8

 

 

201.5

 

Total fairness

 

3,444.2

 

 

3,062.2

 

TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY

 

$

14,038.4

 

 

$

13,691.4

 

COTY INC. & SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

Three Months Ended

September 30,

 

2021

 

2020

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

Net revenue

$

228.9

 

 

227.3

 

 

 

 

 

Adjustments to reconcile internet loss to internet money (utilized in) supplied by working actions:

 

 

 

Depreciation and amortization

137.8

 

 

146.2

 

Non-cash lease expense

18.2

 

 

18.0

 

Deferred revenue taxes

89.9

 

 

(216.0

)

Provision (releases) for unhealthy money owed

1.9

 

 

(3.4

)

Provision for pension and different post-employment advantages

4.1

 

 

2.1

 

Share-based compensation

108.2

 

 

7.0

 

Unrealized features from fairness investments, internet

(389.4

)

 

 

Other

6.6

 

 

26.6

 

Change in working property and liabilities, internet of results from buy of acquired corporations:

 

 

 

Trade receivables

(183.5

)

 

(149.7

)

Inventories

(24.4

)

 

(15.5

)

Prepaid bills and different present property

(2.6

)

 

9.2

 

Accounts payable

82.9

 

 

(103.9

)

Accrued bills and different present liabilities

231.0

 

 

152.6

 

Operating lease liabilities

(20.4

)

 

(34.9

)

Other property and liabilities, internet

(3.5

)

 

(23.0

)

Net money supplied by working actions

285.7

 

 

42.6

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

Capital expenditures

(45.0

)

 

(70.9

)

Proceeds from sale of enterprise, internet of money disposed

 

 

27.0

 

Termination of foreign money swaps designated as internet funding hedges

 

 

(37.6

)

Net money utilized in investing actions

(45.0

)

 

(81.5

)

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

Net proceeds from short-term debt, unique maturity lower than three months

 

 

1.6

 

Proceeds from revolving mortgage services

285.3

 

 

637.4

 

Repayments of revolving mortgage services

(365.5

)

 

(554.2

)

Repayments of time period loans and different long run debt

(6.0

)

 

(48.3

)

Dividend fee on Class A Common Stock

(0.8

)

 

(0.8

)

Dividend fee on Convertible Series B Preferred Stock

(3.5

)

 

 

Proceeds from issuance of Convertible Series B Preferred Stock

 

 

227.2

 

Net proceeds from international foreign money contracts

(11.0

)

 

3.3

 

Purchase of remaining mandatorily redeemable noncontrolling curiosity

(7.1

)

 

 

Distributions to noncontrolling pursuits, redeemable noncontrolling pursuits and mandatorily redeemable monetary devices

 

 

(0.5

)

Payment of financing charges

(10.4

)

 

 

All different

(3.7

)

 

(1.5

)

Net money supplied by financing actions

(122.7

)

 

264.2

 

EFFECT OF EXCHANGE RATES ON CASH, CASH EQUIVALENTS AND RESTRICTED CASH

(6.0

)

 

(2.0

)

NET INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH

112.0

 

 

223.3

 

CASH, CASH EQUIVALENTS AND RESTRICTED CASH—Beginning of interval

310.4

 

 

352.0

 

CASH, CASH EQUIVALENTS AND RESTRICTED CASH—End of interval

$

422.4

 

 

$

575.3

 

 

Investor Relations

Olga Levinzon, +1 212 389-7733

[email protected]

Media

Antonia Werther, +31 621 394495 /

[email protected]

Source: Coty Inc.

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