RESTRUCTURING CHARGES

2015 Efficiency Program

In September 2015, the Company initiated certain restructuring actions to drive certain organizational efficiencies across the Company's Consumer and Professional segments (the "2015 Efficiency Program" or "Efficiency Program"). The actions, which are planned to occur during the remainder of 2015 and through 2016, are expected to reduce departmental expenses within the Consumer and Professional segments. The Company expects to recognize a total of approximately $4 million to $8 million of restructuring and related charges for the Efficiency Program through early 2016. Of the $3.7 million of restructuring and related charges recognized in the third quarter of 2015 for the Efficiency Program, $2.8 million related to the Consumer segment and $0.5 million related to the Professional segment, with the remaining charges included within unallocated corporate expenses.

A summary of the restructuring and related charges incurred through September 30, 2015 in connection with the Efficiency Program is presented in the following table:



	Restructuring Charges and Other, Net
	Employee Severance and Other Personnel Benefits		Other		Total Restructuring Charges		Other Charges (a)		Total Restructuring and Related Charges
Charges incurred in the nine months ended September 30, 2015	$	3.7	$	—	$	3.7	$	—	$	3.7
Total expected charges	$	8.0	$	—	$	8.0	$	—	$	8.0


^(a)	Other charges are recorded within SG&A expenses within the Company’s Consolidated Statements of Income and Comprehensive Income.

In connection with the restructuring actions initiated during the third quarter of 2015 for the Efficiency Program, the Company expects that cash payments will total approximately $3.7 million, of which $1.0 million was paid during the three months ended September 30, 2015. An additional $1.9 million is expected to be paid during the fourth quarter of 2015, with the remaining balance expected to be paid in 2016.

Integration Program

Following Products Corporation's October 2013 acquisition of The Colomer Group Participations, S.L. ("Colomer" and the "Colomer Acquisition"), the Company announced in January 2014 that it was implementing actions to integrate Colomer’s operations into the Company’s business, as well as additional restructuring actions identified to reduce costs across the Company’s businesses (all such actions, together, the “Integration Program”).

The Company expects to recognize total restructuring charges, capital expenditures and related non-restructuring costs under the Integration Program of approximately $50 million in the aggregate over the periods described below.

The Integration Program is designed to deliver cost reductions throughout the combined organization by generating synergies and operating efficiencies within the Company’s global supply chain and consolidating offices and back office support, and other actions designed to reduce selling, general and administrative ("SG&A") expenses. Certain actions that are part of the Integration Program are subject to consultations with employees, works councils or unions and governmental authorities. The Company expects to substantially complete the Integration Program by the end of 2015.

The approximately $50 million of total expected non-restructuring costs, capital expenditures and restructuring charges under the Integration Program referred to above consist of the following:

$1.5 million and $18.4 million of non-restructuring integration costs recognized during the nine months ended September 30, 2015, and through December 31, 2014, respectively. Such costs have been reflected within acquisition and integration costs in the Company's Consolidated Statements of Income and Comprehensive Income and are related to combining Colomer’s operations into the Company’s business;


2.	Expected integration-related capital expenditures of approximately $6 million, of which $0.8 million and $4.4 million were paid during the nine months ended September 30, 2015 and through December 31, 2014, respectively, with the remaining balance expected to be paid during the remainder of 2015; and

Expected total restructuring and related charges of approximately $21 million, of which $(2.3) million and $20.1 million were recognized during the nine months ended September 30, 2015 and through December 31, 2014, respectively, with the remaining charges expected to be recognized during the remainder of 2015. A summary of the restructuring and related charges for the Integration Program incurred through September 30, 2015 and those expected to be incurred during the remainder of 2015 are as follows:



	Restructuring Charges and Other, Net
	Employee Severance and Other Personnel Benefits			Other		Total Restructuring Charges			Inventory Write-offs and Other Manufacturing-Related Costs (a)		Other Charges (b)		Total Restructuring and Related Charges
Charges incurred through December 31, 2014	$	17.3		$	1.6	$	18.9		$	0.6	$	0.6	$	20.1
Charges incurred in the nine months ended September 30, 2015	$	(3.2	)	$	0.3	$	(2.9	)	$	0.3	$	0.3	$	(2.3	)
Cumulative charges incurred through September 30, 2015	$	14.1		$	1.9	$	16.0		$	0.9	$	0.9	$	17.8
Total expected charges	$	14.5		$	2.5	$	17.0		$	2.5	$	1.5	$	21.0


^(a)	Inventory write-offs and other manufacturing-related costs are recorded within cost of sales within the Company’s Consolidated Statements of Income and Comprehensive Income (Loss).


^(b)	Other charges are recorded within SG&A expenses within the Company’s Consolidated Statements of Income and Comprehensive Income (Loss).

During the nine months ended September 30, 2015, the Company recorded a benefit of $2.3 million in connection with the Integration Program, of which $3.7 million is related to the Consumer segment, partially offset by charges of $1.4 million related to the Professional segment. During the nine months ended September 30, 2014, the Company recorded charges related to the Integration Program of $17.1 million, of which $7.3 million related to the Consumer segment and $9.8 million related to the Professional segment.

The Company expects that cash payments related to the restructuring and related charges in connection with the Integration Program will total approximately $20 million, of which $5.8 million was paid during the nine months ended September 30, 2015, and $9.6 million was paid during 2014. The remaining balance of $4.6 million is expected to be paid during the remainder of 2015.

December 2013 Program

In December 2013, the Company announced restructuring actions that included exiting its business operations in China, as well as implementing other immaterial restructuring actions outside the U.S., which are expected to generate other operating efficiencies (the "December 2013 Program"). These restructuring actions resulted in the Company eliminating approximately 1,100 positions in 2014, primarily in China, which included eliminating in the first quarter of 2014 approximately 940 beauty advisors retained indirectly through a third-party agency. The charges incurred for the December 2013 Program relate entirely to the Consumer segment.

A summary of the restructuring and related charges incurred through September 30, 2015 in connection with the December 2013 Program is presented in the following table:



	Restructuring Charges and Other, Net
	Employee Severance and Other Personnel Benefits		Other		Total Restructuring Charges		Allowances and Returns		Inventory Write-offs		Other Charges		Total Restructuring and Related Charges
Cumulative charges incurred through September 30, 2015	$	8.6	$	0.3	$	8.9	$	6.5	$	3.1	$	0.4	$	18.9
Total expected charges	$	8.6	$	0.3	$	8.9	$	6.5	$	3.1	$	0.4	$	18.9

The Company expects net cash payments related to the December 2013 Program to total approximately $17 million, of which $15.5 million was paid during 2014 and $0.1 million was paid in 2013. No charges were incurred during the nine months ended September 30, 2015 related to the December 2013 program. The remaining balance is expected to be paid in 2016.

Restructuring Reserve

The related liability balance and activity for each of the Company's restructuring programs, as summarized above, are presented as follows:



									Utilized, Net
	Balance Beginning of Year		(Income) Expense, Net			Foreign Currency Translation			Cash			Non-cash		September 30, 2015
Efficiency Program:
Employee severance and other personnel benefits	$	—	$	3.7		$	—		$	(1.0	)	$	—	$	2.7
Integration Program:
Employee severance and other personnel benefits	9.6		(3.2		)	(0.2		)	(4.8		)	—		1.4
Other	0.1		0.3			—			(0.4		)	—		—
December 2013 Program:
Employee severance and other personnel benefits	1.2		—			—			—			—		1.2
Other	—		—			—			—			—		—
Other immaterial actions:^(a)
Employee severance and other personnel benefits	3.1		0.1			—			(2.2		)	—		1.0
Other	—		—			—			—			—		—
Total restructuring reserve	$	14.0	$	0.9		$	(0.2	)	$	(8.4	)	$	—	$	6.3

^(a) Other immaterial actions primarily include liabilities for employee-related costs within both the Consumer and Professional segments related to immaterial restructuring actions.

As of September 30, 2015, $6.3 million of the restructuring reserve balance was included within accrued expenses and other in the Company's Consolidated Balance Sheet. At December 31, 2014, $13.7 million of the restructuring reserve balance was included within accrued expenses and other and $0.3 million was included within other long-term liabilities in the Company's Consolidated Balance Sheet.