The Company's equity investments, classified as Equity investments on the Consolidated Balance Sheets, as of June 30, 2022 are represented by the following:


	June 30, 2022		June 30, 2021
Equity method investments:
KKW Holdings (a)	$	12.6	$	16.2
Equity investments at fair value:
Wella (b)	830.0		1,260.0

Total equity investments	$	842.6	$	1,276.2

(a)On January 4, 2021, the Company completed its purchase of 20% of the outstanding equity of KKW Holdings. (See Note 4—Business Combinations, Asset Acquisitions and Divestitures). The Company accounts for this minority investment under the equity method, given it has the ability to exercise significant influence over, but not control, the investee. The carrying value of the Company’s investment includes basis differences allocated to amortizable intangible assets.

During the years ended June 30, 2022 and 2021, the Company recognized $3.6 and $3.2, respectively, representing its share of the investee’s net loss and the amortization of basis differences in Other income, net within the Consolidated Statements of Operations.

(b)On November 30, 2020, the Company completed the previously announced strategic transaction with KKR for the sale of a 60% stake in Coty’s Wella Business. As of June 30, 2022 and 2021, the Company's stake in the Wella Company was 25.9% and 40.0%, respectively.

On October 20, 2021, the Company completed the sale of a 9.4% stake in Wella to an affiliate of KKR, KKR Rainbow Aggregator L.P. ("KKR Aggregator”) in exchange for the redemption of 290,465 shares of KKR Aggregator's Series B Convertible Preferred Stock shares in Coty and a portion of unpaid dividends (the "First Exchange"). On November 30, 2021, Coty completed the sale of an additional 4.7% stake in Wella to KKR Aggregator in exchange for the redemption of KKR Aggregator's remaining convertible preferred shares in Coty (the "Second Exchange"), reducing the Company’s total shareholding in the Wella Company to 25.9%. Refer to Note 23—Equity and Convertible Preferred Stock.

On March 3, 2022, Wella approved an interim distribution to its shareholders. As part of the transaction, Wella refinanced its third party debt and used $210.7 of such funds to make a distribution to the Company, which the Company has accounted for as a return of capital. In addition, on June 16, 2022, Wella approved an additional distribution to its shareholders. As part of the transaction, Wella made a distribution of $19.9 to the Company, which the Company has accounted for as a return of capital.

The following table presents summarized financial information of the Company’s equity method investees for the years ended June 30, 2022 and 2021 (for the period of the Company’s investment). Amounts presented represent combined totals at the investee level and not the Company’s proportionate share:


Summarized Statements of Operations information:	Year Ended June 30, 2022		Year Ended June 30, 2021(a)
Net revenues	$	2,505.1	$	1,317.4
Gross profit	1,706.5		846.3
Operating income (loss)	91.9		(107.3)
Loss before income taxes	(137.8)		(157.7)
Net loss	(171.7)		(174.3)

(a) As the sale of the Wella Business was completed on November 30, 2020, financial results for the Wella Company for fiscal year 2021 reflect seven months of operations.


Summarized Balance Sheets information:	June 30, 2022		June 30, 2021
Current assets	$	951.4	$	1,112.5
Noncurrent assets	4,577.5		4,249.4
Total assets	5,528.9		5,361.9
Current liabilities	985.7		888.5
Noncurrent liabilities	2,525.6		1,624.5
Total liabilities	3,511.3		2,513.0

As of June 30, 2022, the Wella Company had 30.0 million shares of issued common stock and 1,843.2 million shares of issued redeemable preferred stock, of which Coty held 25.9% of each class of shares. The Wella Company had total equity inclusive of redeemable preferred stock of $2,042.0 as of June 30, 2022.

The following table summarizes movements in equity investments with fair value option that are classified within Level 3 for the period ended June 30, 2022. There were no internal movements to or from Level 3 from Level 1 or Level 2 for the period ended June 30, 2022.


Equity investments at fair value:
Balance as of June 30, 2021	$	1,260.0
First Exchange	(390.6)
Second Exchange	(212.7)
Wella Distribution	(230.6)
Total gains/(losses) included in earnings	403.9
Balance as of June 30, 2022	$	830.0

The following table summarizes the significant unobservable inputs used in Level 3 valuation of the Company’s investments carried at fair value as of June 30, 2022. Included in the table are the inputs or range of possible inputs that have an

effect on the overall valuation of the financial instruments.

Fair value

Valuation Technique

Unobservable input

Range

Equity investments at fair value

830.0

Discounted cash flows

Discount rate

11.25% (a)

Growth rate

1.5% - 7.2% (a)

Market multiple

Revenue multiple

2.0x (b)

EBITDA multiple

12.0x – 15.0x (b)

(a)The primary unobservable inputs used in the fair value measurement of the Company’s equity investments with fair value option, when using a discounted cash flow method, are the discount rate and revenue growth rate. Significant increases (decreases) in the discount rate in isolation would result in a significantly lower (higher) fair value measurement. The Company estimates the discount rate based on the investees' projected cost of equity and debt. The revenue growth rate is forecasted for future years by the investee based on their best estimates. Significant increases (decreases) in the revenue growth rate in isolation would result in a significantly higher (lower) fair value measurement.

(b)The primary unobservable inputs used in the fair value measurement of the Company’s equity investments with fair value option, when using a market multiple method, are the revenue multiple and EBITDA multiple. Significant increases (decreases) in the revenue multiple or EBITDA multiple in isolation would result in a significantly higher (lower) fair value measurement. The market multiples are derived from a group of guideline public companies.