Coty has reported first quarter 2017 net revenues of $1,080.2 million, a decline of 3% year-over-year. The company has reported that the declines resulted in the organization's focus on completing the P&G beauty acquisition and bringing in a new management team, which drew resources and attention away from the business.
The effects are expected to continue into the second quarter, while Coty reportedly works to realize synergies of $750 million and working capital benefits of $500 million over the next four years.
Coty is "working on exiting transitional service agreements while increasingly focusing on rebuilding business momentum."
In the first quarter of fiscal 2017, Coty reported that fragrance and color cosmetics sales both dropped 10% year-over-year, while skin and body care dropped 7%. Growth was seen in brands such as Chloe and Davidoff, though celebrity and mass fragrances, as well as Calvin Klein, declined.
The Cutex divestiture negatively impacted the cosmetics business, while the skin and body care business witnessed a decline in the adidas and Playboy brands.
"The last several months have been truly transformational for Coty. On October 1, we closed the P&G Specialty Beauty Business merger, with a $1 billion lower cash payment than anticipated at the announcement of the transaction," said Bart Becht, chairman of the board. "Our new CEO, Camillo Pane, the executive team and the divisional, regional and country management teams are now almost fully in place and are working on exiting transitional service agreements while increasingly focusing on rebuilding business momentum."