Jeffrey Nugent New Revlon CEO
NEW YORK (AP) _ Revlon Inc. has hired Jeffrey M. Nugent as president and chief executive, hoping the former president of Neutrogena Corp. can give the cosmetics and hair-care products company a facelift.
Revlon’s current top executive, George Fellows, submitted his resignation to the board after more than a year of dismal performance and a failed attempt to find a buyer.
``Having some kind of shakeup can help,″ said Melissa Grant, an analyst with Warburg Dillon Read. But, she added, ``There are too many intermediary steps that need to be taken before that can take effect.″
Revlon, which makes Revlon and Almay makeup, Flex shampoo and Charlie perfume, is trying to fix inventory problems at drugstore cosmetics counters. The company also is trying to sell its professional hair-care products business, and some Latin American brands in order to pay down its $1.83 billion in debt.
These distractions have put Revlon behind its rivals, which are moving forward with strategies to compete on the Internet and in a changing retail environment, Grant said.
``They will have a little catching up to do,″ she said.
Revlon has seen its stock price nosedive 68 percent since its high in June. Revlon’s stock rose 25 cents Tuesday to close at $10.62 1/2 a share on the New York Stock Exchange.
New York billionaire Ronald O. Perelman, who controls most of Revlon’s stock and serves as chairman, said Nugent ``is joining a company with great brand names and many other strengths on which to build. He will vigorously address all the challenges and opportunities facing this company, and we are excited to have him as Revlon’s new CEO.″
Nugent. 53, will take his new posts with the New York-based company on Dec. 5.
Nugent served in various senior management positions with Johnson & Johnson, the consumer products giant that owns Neutrogena. The skin-care company has turned into one of Revlon’s more aggressive competitors, recently launching its own Neutrogena makeup line.
Fellows, 56, joined Revlon in 1993 as a senior executive vice president, and was named president and chief executive in 1997.
He took the heat last month for surprising analysts and investors with bad news about the inventory problems and trouble in Brazil, South Africa and other overseas markets.
Revlon has said it expects to report an operating loss of about $125 million in the third quarter, and an operating loss of $70 million to $80 million for the year before additional charges for its restructuring.
The company, which was on the auction block for much of the year, now is negotiating to sell its salon products business, which includes the American Crew and Creative Nails brands. Revlon also will sell some of its Latin American hair care brands, including the Colorama, Juvena, and Plusbelle names.
Together, the two businesses account for 20 percent of Revlon’s $2.2 billion in annual sales.