Revlon Inc (REV) 2016 Q3 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to Revlon's third-quarter 2016 earnings conference call. At the request of Revlon, today's conference call is being recorded. If you have any objections, you may disconnect at this time.

I would now like to turn the call over to Siobhan Anderson, Revlon's Chief Accounting Officer and Treasurer. You may begin, Ms. Anderson.

Thank you. Good morning, everyone, and thanks for joining today's call. Earlier today we released our financial results for the quarter ended September 30, 2016. If you have not already received a copy of the earnings release, you can obtain one on our website at revloninc.com. On the call with me this morning are Fabian Garcia, our President and Chief Executive Officer; and Juan Figuereo, our Chief Financial Officer.

Before I turn the call over to Fabian, I would like to remind everyone of a few items. First, our discussion this morning might include forward-looking statements that are based on our current expectations and are provided pursuant to the Private Securities Litigation Reform Act of 1995. Information on factors that could affect our actual results and cause them to differ materially from such forward-looking statements is set forth in our SEC filings, including our 2015 Form 10-K and our Q3 2016 Form 10-Q, which we filed earlier this morning. We undertake no obligation to publicly update any forward-looking statements, except for the Company's ongoing obligations under the US federal securities laws.

Next, our remarks today will include a discussion of certain GAAP and non-GAAP results. On an as-reported basis, Elizabeth Arden's results have been included in the Company's financial performance beginning on the acquisition date of September 7, 2016. However, in order to provide comparative discussion, our remarks today will be on a pro-forma basis, which presents the GAAP and non-GAAP results as if Revlon and Elizabeth Arden were a combined company for all periods discussed. From a segment view, all of Elizabeth Arden's operating results have been included in the Elizabeth Arden segment.

In addition, consistent with our past reporting practices, the Company has identified certain non-operating and unusual items impacting the comparability of our period-over-period performance. As a result of these unusual items, the individual components within adjusted EBITDA have changed from that used in prior periods, and such adjusted results have been appropriately restated. The adjusted measures are defined in our earnings release and are also reconciled in the financial tables at the end of the release.

And finally, unless otherwise indicated, our discussion today will be on an XFX basis, which excludes the impact of foreign currency fluctuations on the period-over-period variances. Our discussion this morning should not be copied or recorded.

And with that, I will turn the call over to Fabian.

Thank you, Siobhan. Good morning to all and thank you for joining our call. Today marks the first time that we are reporting our quarterly performance as one Company since completing the Elizabeth Arden acquisition on September 7. There are three key points that I would like to open with this morning.

First, as a combined company, our global beauty business continues to grow. Second, we are managing the business as usual for now, minimizing disruptions from integration planning, and intend to continue to do so through the end of the year. We will begin implementing our integration plans early next year, after the crucial fourth quarter is behind us. And third, we remain extremely enthusiastic about the tremendous value creation opportunity presented by the combination of our companies and brands.

With that, I am now pleased to share with you more specific highlights for the third quarter. As stated in this morning's earnings release, we ended the third quarter strong, with as-reported net sales up 30% or plus 2.5% on a pro forma basis for the combined Company, adjusted for foreign currency. All four of our reporting segments -- consumer, professional, Elizabeth Arden, and other -- delivered ex-foreign exchange net sales growth in the quarter.

As we take a closer look at the performance of each reporting segment, we are pleased to report that the Elizabeth Arden brand achieved its seventh consecutive quarter of net sales growth, driven by new product innovation and efforts to modernize the brand's relevance and attract new consumers. In the quarter on a pro forma basis, net sales grew in all three categories under the Elizabeth Arden brand -- skincare, color cosmetics, and fragrances.

Within the Elizabeth Arden cosmetics category, which experienced double-digit net sales growth for the period, Grand Entrance Mascara, and Prevage anti-aging foundation were notable contributors. The Elizabeth Arden brand business also grew online sales double digit for the quarter, as we continue to leverage digital strategies that align with shifting consumer purchasing behavior.

Also within the Elizabeth Arden segment, our owned and licensed fragrance business, had strong performance this quarter on a pro forma basis, as many of the designer and lifestyle brands continued to grow both at retail and online. Specifically during the quarter, sales were strong in John Varvatos, White Diamonds, and Britney Spears fragrances, the latter behind the new Private Show line.

In addition to the strong performance from our new Elizabeth Arden segment, I would like to point out that the stand-alone Revlon business also continued its growth trajectory, reporting our sixth consecutive quarter of net sales increases. These segments experienced top-line growth and increased consumption across many key new product innovations and core franchises in the portfolio, including Revlon Ultra HD Matte Lipcolor, which year-to-date September is the most successful new product innovation in the US mass color cosmetics category, according to Nielsen.

Other strong performers in the quarter which contributed to net sales growth include Cutex, American Crew men's grooming line and three-in-one shampoo, conditioner and body wash, and the new Revlon Professional Be Fabulous haircare collection.

The North American consumer business, however, was soft in the period, driven primarily by Revlon Color Cosmetics and SinfulColors. These businesses were impacted by slowing consumption in the US mass retail channel and in addition, Revlon Color Cosmetics experienced customer inventory re-balancing and promotional display timing shifts.

Although we have many examples of sustained growth within our portfolio, and as previously reported, we continue to experience softness in three of our brands and have begun to implement strategies and plans to restore sales growth.

First, Revlon ColorSilk haircolor continues to be challenged in the entry-priced in-home haircolor category. The brand has already started to ship a new color protecting shampoo and conditioner range under the ColorSilk franchise and a new ColorSilk Buttercream haircolor formula. These initiatives further leverage our expertise in haircolor and care and we are encouraged by early results.

Almay will begin a re-launch of the brand in the second half of 2017, building on the brand's core equities with a modern, relevant positioning. Our marketing team has just completed extensive qualitative and quantitative research with more than 1,700 consumers to assess purchase interest and acceptance for the repositioned brand concept. We will begin to present the new positioning to our trade partners before the end of the year.

Also as previously reported, CND has been under pressure from low-priced competitors in the US, and we are beginning to respond with a more strategic approach, aiming to restore our growth in that category. Earlier this year we introduced CND Creative Play, a range of 80 shades of vibrant colors in the value-priced nail enamel category, and we are gaining momentum behind expanded distribution of the range. We also have another exciting innovation in the pipeline for the second half of 2017 that is designed to restore CND's leadership in the high-performance nail category.

The vitality of our business is further demonstrated by strong international growth for the period across all our business segments, with double-digit net sales growth for our consumer business in Asia and for the Elizabeth Arden business in China. We also had notable growth in the quarter in Argentina, the UK, Mexico, France, Germany and South Africa.

In addition to continuing to deliver our business objectives, almost immediately after closing the Elizabeth Arden acquisition, we began fine tuning our integration planning to reconfirm the synergy estimates we have shared externally during the due diligence process. I am happy to report that we are making good progress across multiple fronts and have confirmed our ability to deliver at least $140 million in multi-year synergies and cost reductions related to the transaction.

We have also have been working to design a new organizational structure to enable us to drive and accelerate future growth. You will be hearing more about this in the future.

Looking forward, we are already stronger and more competitive as a combined organization, with exciting opportunities for growth and development for our employees, business partners, shareholders, and consumers. As one Company we also have more capabilities and resources to grow our combined portfolio of brands, as well as the opportunity to reach consumers wherever and however they shop for beauty.

As we begin to better understand and leverage the opportunities that the acquisition presents for our business and our teams, I am encouraged by the strength and resilience of our iconic brands; excited about our strong growth potential, both in North America and internationally; and impressed by our passionate and talented employees, who are committed to our brands and business and to building a world-class beauty competitor.

To help us achieve this potential, we will pursue the following strategic objectives: first, build a foundation for sustainable growth that outpaces the industry. We will focus on fast-growing beauty segments and strategic categories, continue to diversify our channels, especially direct-to-consumer, and accelerate our expansion in Asia; second, harness the power of our iconic brand portfolio to delight consumers whenever and however they shop for beauty, advance our digital and multichannel capabilities while ensuring we continue to win in traditional mass, prestige, and salon channels around the world; and, third, develop a cost structure that delivers world-class profitability and permits us to continue to invest in our brands.

I will now turn the call over to Juan, who will walk you through a summary of our financial performance.

Thank you, Fabian, and good morning, everyone. As a reminder, unless otherwise indicated, our discussion today will be on an XFX basis and on a pro forma basis where applicable. And later, when we discuss total Company results, please refer to the reconciliations of as-reported results to adjusted and pro forma adjusted results, which are provided as an attachment to the earnings release.

We will now review our segment results. Starting with our consumer segment, consumer segment net sales were essentially flat in Q3, primarily as a result of incremental net sales from the Company's global consolidation of the Cutex brand as well as higher net sales of Revlon beauty tools and Revlon color cosmetics, mostly offset by lower net sales of SinfulColors.

As Fabian mentioned, our company net sales in North America were soft versus the prior-year quarter, down 5.3%, primarily driven by softening market conditions in core categories, which impacted Revlon color cosmetics and SinfulColors. These decreases were partially offset by incremental net sales in connection with the Company completing the global consolidation of the Cutex brand as well as higher net sales of Revlon beauty tools.

Internationally, net sales within the consumer segment grew 9.7% compared to the prior-year quarter, driven by higher net sales of Revlon color cosmetics and Revlon ColorSilk haircolor as well as incremental net sales from Cutex. From a geographic perspective, the increase in international net sales was mainly due to Argentina, the UK, and Mexico.

Consumer segment profit was $81 million in Q3, representing a decrease of 5.8%, primarily resulting from the absence in 2016 of a $3.5 million gain related to the sale of a non-core consumer brand that was completed in the third quarter of 2015. Excluding this gain, consumer segment profit would have decreased by 1.8%, resulting primarily from the unfavorable impact of FX transaction within cost of sales, offset by decreased brand support on lower performing brands.

Switching now to the professional segment, professional segment net sales in Q3 were $118.8 million, an increase of 4.5% versus the prior-year quarter. In North America, professional net sales increased 2.2%, driven primarily by the American Crew men's grooming products and the Elvis-branded marketing campaign.

Internationally, professional net sales grew 6.3% in the quarter, primarily driven by Revlon Professional hair products, in part due to the launch of the Be Fabulous haircare collection as well as an increase in net sales of American Crew men's grooming products throughout most of the international region, partially offset by lower net sales of CND, primarily in Russia. Professional segment profit was $23.7 million in Q3, an increase of 1.3%, driven by higher net sales internationally, partially offset by higher brand support.

Moving to the Elizabeth Arden segment, on a pro forma basis the Elizabeth Arden segment net sales in Q3 were $275.5 million, a 4.5% increase versus the prior-year quarter. In North America, Elizabeth Arden net sales increased 2.4%, primarily driven by increased net sales of Elizabeth Arden color cosmetics as well as higher net sales of owned and licensed fragrances in designer and heritage brands.

Internationally, Elizabeth Arden grew 8.5%, driven by higher net sales of fragrances in South Africa and the UK, as well as higher net sales of Elizabeth Arden color cosmetics in South Africa. Elizabeth Arden segment profit was $38.8 million in Q3, representing an increase of 46.7%, driven by higher net sales, coupled with lower cost of goods sold as a result of cost reduction initiatives and the favorable impact of product and channel mix.

As for our other segment, net sales increased 6.7% versus the prior-year quarter, while segment profit was essentially breakeven.

Moving now to total Company results, on a pro forma basis we reported consolidated net sales of $745.1 million in Q3, an increase of 1% or 2.5% XFX over the prior-year quarter. Consolidated pro forma adjusted EBITDA was $105.5 million, an increase of 9.3% XFX over the prior-year quarter. This was driven by the increase in net sales as well as gross margin improvement in the Elizabeth Arden segment. Consolidated pro forma adjusted net income in Q3 was $15.8 million, an increase of $21.8 million, driven by the increases discussed in pro forma adjusted EBITDA as well as a lower tax provision due to the phasing of pre-tax income.

Now for a liquidity update: taking a look at cash, we continue to feel good about our liquidity position. As of September 30, 2016, we had approximately $307.2 million of gross liquidity, consisting of $99.2 million of cash on hand and available borrowing capacity of $207.9 million on our revolver.

As for guidance, you will recall that we provided a full-year outlook for 2016 sales and EBITDA on an XFX basis in connection with the financing of the Elizabeth Arden acquisition. Now that the acquisition is completed, we will be returning to our long-standing practice of providing information about performance but not forward-looking guidance.

However, I wanted to close this chapter by letting you know that we still expect the stand-alone Revlon business to be within the previously announced range of $2 billion to $2.1 billion in net sales and $400 million to $420 million in adjusted EBITDA.

And with regards to the integration of Elizabeth Arden, as Fabian previously mentioned, through our post-closing detailed planning work, we have confirmed our ability to generate at least $140 million of synergies and cost reductions. We expect to complete the integration planning phase by the end of the year and to start executing those plans early in 2017. We are also revisiting cost estimates and evaluating options to increase and/or accelerate synergy capture. We will provide more information at the proper time.

Now I will turn the call back over to Siobhan.

Thank you, Juan. This concludes our prepared remarks, and we would now like to open up the call for your questions. Operator, please prompt the participants for questions.

(Operator Instructions) Kevin Ziets, Citi.

Thanks for taking my questions. The first one is just understanding the guidance a little bit. I see there is a breakdown for Arden's EBITDA for the quarter, I guess prior to when you owned it, of about negative $8 million. It seems to me that, just using the segment information, that they may have done somewhere around $20 million in EBITDA on a combined basis for the quarter -- which leaves, I guess, a pretty good gap for Revlon standalone to achieve its $400 million to $420 million for the full year. I'm just thinking about that in terms of what happened in North America in cosmetics this quarter, and where the confidence comes from.

I think what you are asking is really about the Revlon standalone. Obviously, next quarter and the quarters after that, it will be very difficult to see Revlon standalone, since we are now reporting combined.

But with regards to guidance, to be clear, I would tell you that we are in the range, but tracking towards the lower end of that range. The seasonality this year for Revlon standalone is a little higher than we have had in the past, although every year the fourth quarter has more weight than almost any other quarter on the EBITDA result.

This year is higher because, as we had previously indicated, that is how we planned the rollout of the innovations, and there's significant pipeline of innovation in the fourth quarter this year. That is basically what drives such a heavy weight on the fourth quarter.

Okay, that's great. Along those lines, do you feel like you picked up additional shelf space going into the planogram resets in January?

So we feel that we are faring quite well with our trade partners, given the innovation that we are presenting and the strength in the business. And I just wanted to add a comment to the guidance answer that Juan provided.

We continue to feel very good about the balance of our business in Revlon, and of course we feel very good about how Elizabeth Arden is doing. Our international businesses in Revlon are terrific and have continued to accelerate. And obviously the headwinds in North America are what they are, but our brand continues to be strong and we have great innovation that is coming in the pipeline.

So the net of all of that is we feel good about getting within the range of the guidance that we provided, towards the lower end, despite the headwinds in North America.

Okay. Along the lines of the retailer rebalancing that you mentioned is: do you feel like that's complete? How long do you expect that to be a headwind? Is it driven by some of the consolidation that has happened, or is it exclusive of that?

I would say first it's hard to predict how they are going to move their inventory. Obviously, there is a lot of movement in consolidation, as you mentioned, with some retailers buying some others.

My view is that we have seen that in cycles as they close their own quarter. So our expectation is we are going to get to a normalized level that we can build from. So that is my answer to your question.

Okay. And then just on the synergies, and I know you said you are evaluating the timing of the spend, could you talk maybe just in broad strokes? I think you had laid out at the time of the deal a split between what was going to be achieved in supply chain versus other cost savings. I was wondering if you could maybe update your thoughts on that.

Sure, Kevin. This is Juan again. We said about $140 million in synergies, and roughly about 60% of those were from supply chain. And we also said that we expected about $105 million to be implemented -- not realized, to be clear; implemented, meaning that we have not yet taken the actions necessary for the reductions to happen.

But I think the important thing that we would like to leave you with is that we feel really good about that estimate now that we had a chance to go into the details. And we are actually now looking for ways to either accelerate the phasing, the timing; or increase -- the total amount of the synergies. When we have more details, then we will be able to provide it. But right now we are in the final stages.

Okay, great. I'll jump back in the queue and let some other people get in.

William Reuter, Bank of America Merrill Lynch.

You guys talked about in North America -- you described it as, I think, soft market conditions for color cosmetics and SinfulColors. I'm wondering whether you believe that this was specific to those brands, or whether they have lost some share in the quarter; or whether, alternatively, it was just the category that was down?

Let's take that in two parts. The category of North America color cosmetics is decelerating and also it's happening in hair coloring. So the growth rate for the third quarter are a fraction of what they were in the beginning of the year. So that's that.

Our brands continue to be strong, especially the Revlon color cosmetic brand as it is above 10% share. And within that, we are seeing very encouraging growth in the lip category and in the eye category. So those are, of course, where the innovation has been most active for the quarter.

So this is a story of a market that is decelerating, and the market shares are holding. That's how the numbers pan out in North America.

Okay, that's helpful. I know that when we did the financing for the acquisition, you guys were unable to talk to some of your customers about Elizabeth Arden in certain ways. I'm curious, now that you guys have had a chance to talk to some of them, where do you guys believe the opportunity for revenue synergies are -- because I think most of the synergies we talked about were on the cost side.

Yes, thank you for the question. Obviously we are very busy with the cost reductions and the cost synergies, and that is our number-one priority. But at the same time, we are seeking to materialize some of the revenue synergies that we had talked during the funding period.

I'll give you an example. Very recently my team and I went to visit a very large multi-geographic retailer in the drug category and presented our combined plan and the reception that we had was very positive. We had started to lay out specific opportunities by country, mostly distribution gain, and making sure that we addressed joint business plans, as we have a combined portfolio in core categories that drive most of the growth.

And the outputs were positive and immediate. So we are planning to have these kind of meetings with most of our multinational retailers in the next two quarters. So we are encouraged by what we hear from our trade customers, and we will continue to materialize these quick wins into revenue synergies.

Do you think in a couple of quarters, after you have had these conversations, you would be able to provide estimates for what types of opportunities they would be in terms of quantifying them?

I don't think we are going to provide them customer by customer, but we feel very good about the prospects of that revenue synergy. And obviously that will add up to the cost synergies to make the acquisition more accretive for the Company.

Okay. And then just lastly for me, given there's a lot of opportunity for synergies here, will you guys focus on integrating the Elizabeth Arden business? Or would you guys consider other acquisitions at this point?

Obviously, we will not comment on future acquisitions. Our focus right now is to make sure this is a great success from both a cost reduction and synergies point of view as well as the revenue synergies that we just discussed. So that's our number-one priority. And believe me, it will keep us busy for a while.

Okay, I'll turn it to others. Thank you.

(Operator Instructions) Grant Jordan, Wells Fargo.

Thanks for taking the questions. Most of mine were covered. I guess I had one.

We did see some improvement in the Elizabeth Arden segment profit. In the press release it called out cost reduction efforts. Was that stuff that Arden had already enacted, or were those the result of some of the actions you've already taken post the close?

The improvements are mostly driven by the actions that they had already taken before we took them over. I think they had done a good job with the previously announced cost reduction plan. So some of that was already flowing through the P&L.

There is some impact related to the actions that we are taking. But I would say in the quarter that was very small. It was mostly what they had already done.

Okay, that's helpful. And then I think last quarter or maybe the quarter before, you had talked about the CND product trying to introduce some more lower-priced products. Was that what you were talking about earlier whenever you said you were hoping to regain share in that category?

Exactly, what we have talked about in prior quarters is a strategy that would help us address the value issue. That's the commentary I made in my remarks. And I also mentioned that we have another strategy, another strategic initiative coming in the second half of 2017 that would allow us to reassert the superiority of CND to gain share in the premium segment of the category.

Okay. All right. So those two are separate, but both on CND? Okay, that's helpful. That's all I had. I appreciate it.

Hale Holden, Barclays.

I had a couple of quick ones. On the US retailer inventory management, do you have a sense of what your sellout was during that period? Presumably they are going to have to restock at some point. So I was wondering if you felt good about the sellout of the stores versus what the stores were doing internally.

Yes, we feel good about the sellout. And we are working practically to restore their inventories in store and in their warehouses so that we can give the consumers what they are looking for.

On the two innovations that you highlighted, CND and the other product for the second half of 2017, how do we think about those brands in the meantime between now and then? It's a decent amount of time. Is there going to be a continued trail-off in sales for the next two quarters before it rebounds? Or can you keep it kind of steady state?

We plan to keep it kind of steady state. In fact, we have seen improvement in the trend for CND in the US and outside of the US in this particular quarter. We have also seen improvements in this quarter on Almay. So our intent is to take the necessary measures to stabilize the business before the strategic solutions situations come into play.

And then my last question was, you highlighted in the script the strong performance of Arden in China, which has kind of been a continued theme for that part of the business. Can you just provide us a little bit more color or details on where the strength in China is coming from, how it's working, and maybe the outlook for that?

Well, we actually talked about this during the due diligence and as we were presenting the opportunity to the bank. We see a great opportunity for growth in China with Elizabeth Arden; and obviously, based on their platform, also for Revlon.

They are doing terrific in two aspects, I think. In the online world they continue to experience, obviously, the growth. And they have experienced such growth now for a sustained period of time.

In the brick-and-mortar world they are renovating the distribution and revitalizing the brand. Literally 2 1/2 weeks ago, I was with my team and the Elizabeth Arden team opening a new counter in a prominent department store in Shanghai, they have a New World store on Nanjing Road. And that is the first execution in the world of the brand-new counter look for Elizabeth Arden.

We had a similar effort in the UK a couple of weeks ago. But what we are very encouraged about is the renovation and the revitalization of the brand in brick-and-mortar. So we feel very good about what they're doing in China and how that Chinese initiative will be used to confirm the growth potential that we have in that part of the world.

Great. Thank you for the additional color. Appreciate it.

Carla Casella, JPMorgan.

Can you just give us some color on gross margins -- how much the gross margin was for Revlon and for Arden, or some sort of comparison year-over-year?

Sure. First, let me point out kind of the obvious, which is Revlon has a higher gross margin than Elizabeth Arden. So the combination on a pro forma basis would show lower gross margins.

The combined gross margin on a pro forma basis was actually 40 bps higher than the combined pro forma for the previous year at 56.9%. And Arden gross margin stand-alone was also a slight increase, primarily as a result of product and geographic mix.

So Arden stand-alone was up. Was Revlon, then, down?

Yes. Revlon was a little down from FX. We had a negative impact of ForEx on our gross margin in the quarter.

Okay. And the holiday is very important for fragrances. Can you give us a sense for how the retailers are setting up this holiday for fragrances? Are they allotting more or less shelf space to either general fragrances, or special box sets, or other special promotional items?

So far we haven't seen any material changes in space allocations. On the contrary, we feel very good about the sell-in. And this is what we are getting for fragrances in this season. So far, so good.

Okay, great. And then have you given a sense for how much you expect to spend next year on display spending for the combined businesses?

Thank you for the question, Carla. The answer is not yet. We are beginning our budget process right now. Obviously, we have the first half of the budget already approved for Elizabeth Arden, as they did that in their fiscal year base. But we will have a much better sense of the combined spending on displays, walls, and counters when we come back to you guys after the first quarter.

Okay, great. Thank you.

(Operator Instructions) Kevin Ziets, Citi.

The question was around brand support levels going into 2017. You announced a number of big initiatives, including the CND launch and the Almay launch in the second half of next year. So do you think in general we will be seeing higher levels of brand support -- maybe at a pace faster than sales growth next year?

Too early for me to comment on that, Kevin. I think, as I said before, we are in the middle of the budget season for the year.

Obviously, we will be supporting the innovations on the products that will be re-launched in the year. Obviously, lots of innovation in the major brands and I intend this is to make sure the consumers get exposure to those innovations.

So we will comment when the budgets are ready. But my expectation is that we will be supporting the brands competitively.

Okay. And you mentioned the double-digit online growth for Elizabeth Arden. Was that only in China or predominantly in China? Or is Arden experiencing a strong online growth in the US as well?

My understanding is that it's not only in China. For the quarter they were up significant double-digit, up 25%. So they did well wherever we are doing online sales.

Okay. And then lastly, on hedging, I'm just curious if -- you know, the pound has taken a beating. I'm curious if you are hedged for that exposure, at least from a transaction perspective?

Yes, Kevin. I think we had indicated previously that we have rolling hedges in place for all the currencies were we have significant exposure, including, of course, the British pound. In terms of a rule of thumb, I think every $0.10 in the pound is worth roughly about $1 million in EBITDA impact to us.

That's great. Thank you very much.

At this time there are no additional callers in the queue. I would like to turn the conference back over to Ms. Anderson for any additional or closing comments.

This is Fabian. So thank you very much for joining our call, for your continued interest in our newly combined Revlon and Elizabeth Arden Company. And a special thanks to both our Revlon and Elizabeth Arden teams around the world for their hard work, executional excellence, and continued commitment to growing our Company. I wish you all a very happy and healthy upcoming holiday season. We will talk to you in January. Thank you.

Thank you.

That does conclude today's teleconference. We thank you all for your participation.