Cosmetics maker Revlon has submitted for personal bankruptcy in the US, as it claims source chain disruptions have driven up the value of uncooked resources for its items.
The 90-yr-previous firm says it has also been struggling with provider payments, inflation and labour shortages.
The enterprise claims it expects to acquire $575m (£466.6m) from its current creditors to help day-to-day operations.
Its shares lost extra than 13% in New York buying and selling just after the announcement.
In a courtroom submitting, the company explained that provide chain disruptions experienced prompted intense competitors for the ingredients applied in its cosmetics. It additional that suppliers have also questioned to be compensated for orders upfront.
This has caused “shortages of necessary elements across the firm’s portfolio,” Revlon’s main restructuring officer Robert Caruso mentioned in the filing.
“For instance, a single tube of Revlon lipstick calls for 35 to 40 raw elements and element areas, each and every of which is critical to bringing the product or service to marketplace,” he included.
As nicely as the Revlon manufacturer, the organization also owns properly-acknowledged names this kind of as Elizabeth Arden, Almay and Cutex, and fragrances fronted by Christina Aguilera and Britney Spears.
In recent decades it has confronted elevated competitors from new makes like people backed by celebrities these types of as Kylie Jenner’s Kylie Cosmetics and Rihanna’s Fenty Elegance.
By submitting for Chapter 11 individual bankruptcy protection in the US Revlon will be in a position to carry on to function even though it is performing out a strategy to repay its lenders.
Revlon’s president and chief govt Debra Perelman claimed the individual bankruptcy filing will let the organization to “provide our prospects the legendary solutions we have delivered for a long time, while providing a clearer route for our upcoming advancement”.
Nonetheless, the New York Inventory Exchange stated on Thursday that it experienced started the procedure of eradicating the company’s shares from its platform.
Revlon was shaped in 1932 by brothers Charles and Joseph Revson and Charles Lachman and began providing nail polish shortly immediately after. By the mid-1950s it experienced turn into an global brand.
It was acquired by billionaire businessman Ronald Perelman’s MacAndrews & Forbes in 1985. Revlon now sells its products in additional than 150 nations.
Earlier this 12 months, Revlon warned that it was dealing with “liquidity constraints introduced on by continued world wide worries, which includes provide chain disruption and climbing inflation”.
It experienced $3.3bn of prolonged-expression debt at the close of March, and stories of its impending individual bankruptcy final 7 days triggered a slide in its share price tag.
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