SEGMENT REPORTING

6 Months Ended

Dec. 31, 2019

The Company’s current organizational structure is category focused, putting the consumers first, by specifically targeting how and where they shop and what and why they purchase. 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 Company’s 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.

The Company has the following three divisions which represent its operating segments and reportable segments:

Luxury — primarily focused on prestige fragrances, premium skin care and premium color 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.

On July 1, 2019, the Company announced its turnaround plan, which includes planned changes to the reporting structure to the CODM. As part of these reporting structure changes, management expects to move from the current organizational structure into regional commercial business units in Europe, Middle East & Africa (“EMEA”) and Americas and Asia Pacific for the combined Luxury and Consumer Beauty businesses. Such regional business units will be supported by central Luxury and Consumer Beauty marketing teams. Professional Beauty remains a distinct business unit. The Company anticipates that its

operating and reporting segments would change upon completion of such reporting structure changes and the related changes in the financial information provided to the CODM, which is expected to occur in the third quarter of fiscal 2020. See Note 1—Description of Business for information on the Company’s turnaround plan update announced on October 21, 2019.

Certain income and shared costs and the results of corporate initiatives are 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 and realignment costs, costs related to acquisition and divestiture 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 9—Goodwill and Other Intangible Assets, net.


	Three Months Ended December 31,						Six Months Ended December 31,
SEGMENT DATA	2019		2018		2019		2018
Net revenues:
Luxury	$	1,016.5	$	1,017.5	$	1,823.2	$	1,810.4
Consumer Beauty	799.7		967.8		1,516.2		1,796.6
Professional Beauty	528.8		525.9		948.4		935.5
Total	$	2,345.0	$	2,511.2	$	4,287.8	$	4,542.5
Operating income (loss):
Luxury	$	148.1	$	113.6	$	238.4	$	162.3
Consumer Beauty	26.9		(906.9)		(16.4)		(925.5)
Professional Beauty	73.5		73.8		97.9		78.8
Corporate	(213.1)		(85.1)		(158.5)		(140.9)
Total	$	35.4	$	(804.6)	$	161.4	$	(825.3)
Reconciliation:
Operating income (loss)	$	35.4	$	(804.6)	$	161.4	$	(825.3)
Interest expense, net	71.1		68.3		148.5		132.4
Other expense, net	1.3		4.8		3.5		7.5
(Loss) income before income taxes	$	(37.0)	$	(877.7)	$	9.4	$	(965.2)

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


	Three Months Ended December 31,						Six Months Ended December 31,
PRODUCT CATEGORY	2019		2018		2019		2018
Fragrance	44.9	%	43.5	%	43.7	%	42.3	%
Color Cosmetics	20.4		23.3		22.2		24.7
Hair Care	26.3		24.4		25.5		24.3
Skin & Body Care	8.4		8.8		8.6		8.7
Total Coty Inc.	100.0	%	100.0	%	100.0	%	100.0	%