SEGMENT REPORTING

Operating and reportable segments (referred to as “segments”) reflect the way the Company is managed and for which separate financial information is available and evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and assess performance. The Company has designated its Chief Executive Officer as the CODM.

In connection with the Company’s acquisition of the P&G Beauty Business, the Company realigned its operations and determined management’s internal and external reporting based on the following three divisions – Luxury, Consumer Beauty and Professional Beauty. The new organizational structure is category focused, putting the consumer first, by specifically targeting how and where they shop and what and why they purchase. Each division has full end-to-end responsibility to optimize consumers’ beauty experience in the relevant categories and channels. The Company has determined that its three divisions are its operating segments and reportable segments. The operating and reportable segments are:

Luxury — primarily focused on prestige fragrances, premium skin care and premium cosmetics;

Consumer Beauty — primarily focused on color cosmetics, retail hair coloring and styling products, mass fragrance, mass skin care and body care;

Professional Beauty — primarily focused on hair and nail care products for professionals.

As a result of this change in segment reporting, the Company retrospectively revised prior period results, by segment, to conform to current period presentation. Prior to the realignment, the Company operated and managed its business as four operating and reportable segments: Fragrances, Color Cosmetics, Skin & Body Care, and the Brazil Acquisition.

Certain revenues and shared costs and the results of corporate initiatives are being managed outside of the three segments by Corporate. The items within Corporate relate to corporate-based responsibilities and decisions and are not used by the CODM to measure the underlying performance of the segments. Corporate primarily includes restructuring costs, costs related to acquisition activities and certain other expense items not attributable to ongoing operating activities of the segments.

With the exception of goodwill and acquired intangible assets, the Company does not identify or monitor assets by segment. The Company does not present assets by reportable segment since various assets are shared between reportable segments. The allocation of goodwill and acquired intangible assets by segment is presented in Note 10—Goodwill.



	Year Ended June 30,
SEGMENT DATA	2017			2016			2015
Net revenues:
Luxury	$	2,566.6		$	1,836.6		$	1,938.3
Consumer Beauty	3,688.2			2,262.5			2,185.4
Professional Beauty	1,395.5			250.0			271.5
Total	$	7,650.3		$	4,349.1		$	4,395.2
Depreciation and amortization:
Luxury	$	203.5		$	99.1		$	113.0
Consumer Beauty	256.2			114.6			99.7
Professional Beauty	95.4			18.0			16.9
Corporate	—			0.3			1.3
Total	$	555.1		$	232.0		$	230.9
Operating income (loss):
Luxury	$	158.0		$	228.9		$	313.1
Consumer Beauty	261.2			246.5			156.4
Professional Beauty	78.5			68.0			74.8
Corporate	(935.5		)	(289.2		)	(149.2		)
Total	$	(437.8	)	$	254.2		$	395.1
Reconciliation:
Operating (loss) income	$	(437.8	)	$	254.2		$	395.1
Interest expense, net	218.6			81.9			73.0
Loss on early extinguishment of debt	—			3.1			88.8
Other expense, net	1.6			30.4			—
(Loss) income before income taxes	$	(658.0	)	$	138.8		$	233.3

Additionally, in connection with the Company’s acquisition of the P&G Beauty Business, the Company reorganized its geographical structure into three regions: North America (Canada and the United States), Europe and ALMEA (Asia, Latin America, the Middle East, Africa and Australia).



	Year Ended June 30,
GEOGRAPHIC DATA	2017		2016		2015
Net revenues:
North America	$	2,506.9	$	1,413.0	$	1,499.7
Europe	3,325.7		1,924.6		1,961.6
ALMEA	1,817.7		1,011.5		933.9
Total	$	7,650.3	$	4,349.1	$	4,395.2



Long-lived assets:
U.S.	$	7,662.4	$	2,688.7	$	2,713.9
Switzerland	6,899.8		508.0		297.4
Brazil	863.3		882.7		1.4
All other	3,187.3		830.9		931.8
Total	$	18,612.8	$	4,910.3	$	3,944.5

For Net revenues, a major country is defined as a group of subsidiaries in a country with combined revenues greater than 10% of consolidated net revenues or as otherwise deemed significant. The United States and United Kingdom are the only two countries that account for more than 10% of total net revenue for fiscal years 2017, 2016, and 2015. The United States had net revenues of $2,220.4, $1,256.0 and $1,342.9 in fiscal 2017, 2016, and 2015, respectively. The United Kingdom had net revenues of $735.1, $429.5, and $450.4 in fiscal 2017, 2016, and 2015, respectively.

For Long-lived assets, a major country is defined as a group of subsidiaries within a country with combined long-lived assets greater than 10% of consolidated long-lived assets or as otherwise deemed significant. Long-lived assets include property and equipment, goodwill and other intangible assets.

No customer or group of affiliated customers accounted for more than 10% of the Company’s Net revenues in fiscal 2017, 2016 and 2015 or are otherwise deemed significant.

Presented below are the net revenues associated with Company’s product categories:



	Year Ended June 30,
PRODUCT CATEGORY	2017		2016		2015
Fragrances	36.1	%	46.3	%	49.6	%
Color Cosmetics	29.6	%	35.9	%	32.9	%
Skin & Body Care	12.4	%	17.6	%	17.5	%
Hair Care	21.9	%	0.2	%	—	%
Total	100.0	%	100.0	%	100.0	%