SEGMENT DATA AND RELATED INFORMATION

Operating segments include components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (the Company's “Chief Executive Officer”) in deciding how to allocate resources and in assessing the Company's performance. As a result of the similarities in the procurement, manufacturing and distribution processes for the Company’s products, much of the information provided in the Unaudited Consolidated Financial Statements, and provided in the segment table below, is similar to, or the same as, that reviewed on a regular basis by the Company's Chief Executive Officer. As of September 30, 2017, and since the Elizabeth Arden Acquisition Date, the Elizabeth Arden organization has continued to operate and be evaluated on a stand-alone basis.

At September 30, 2017, the Company’s operations are organized into the following reportable segments:

•

Consumer - The Company’s Consumer segment is comprised of products that are marketed, distributed and sold in large volume retailers, chain drug and food stores, chemist shops, hypermarkets, general merchandise stores, the Internet/e-commerce, television shopping, department stores, one-stop shopping beauty retailers, specialty cosmetic stores and perfumeries in the U.S. and internationally under brands such as Revlon, Almay, SinfulColors and Pure Ice in cosmetics; Revlon ColorSilk in women’s hair color; Revlon in beauty tools; and Mitchum in anti-perspirant deodorants. The Consumer segment also includes a skin care line under the Natural Honey brand and hair color line under the Llongueras brand (licensed from a third party) that are sold in large volume retailers and other retailers, primarily in Spain, as well as Cutex nail care products.

•

Elizabeth Arden - The Elizabeth Arden segment markets, distributes and sells fragrances, skin care and color cosmetics to prestige retailers, specialty stores, the mass retail channel, distributors, perfumeries, department stores, boutiques, travel retailers and other retailers in the U.S. and internationally, as well as direct sales to consumers via its Elizabeth Arden Red Door branded retail stores, Elizabeth Arden.com e-commerce business and Elizabeth Arden Red Door spa beauty salons and spas under brands such as Skin Illuminating, SUPERSTART, Prevage, Eight Hour Cream, Elizabeth Arden Ceramide and Visible Difference in the Elizabeth Arden skin care brands; Elizabeth Arden Red Door, Elizabeth Arden 5th Avenue, Elizabeth Arden Green Tea and UNTOLD in Elizabeth Arden fragrances; Juicy Couture, John Varvatos and Wildfox Couture in designer fragrances; and Curve, Elizabeth Taylor, Britney Spears, Christina Aguilera, Halston, Ed Hardy, Geoffrey Beene, Alfred Sung, Giorgio Beverly Hills, Lucky Brand, PS Fine Cologne for Men, White Shoulders and Jennifer Aniston in heritage fragrances.

•

Professional - The Company’s Professional segment markets, distributes and sells professional products primarily to hair and nail salons and professional salon distributors in the U.S. and internationally under brands such as Revlon Professional in hair color, hair care and hair treatments; CND in nail polishes and nail enhancements, including CND Shellac and CND Vinylux nail polishes; and American Crew in men’s grooming products. The Professional segment also includes a multi-cultural hair care line consisting of Creme of Nature hair care products, which are sold in both professional salons and in large volume retailers and other retailers, primarily in the U.S.


•	Other - The Other segment includes the operating results related to the development, marketing and distribution of certain licensed fragrances and other beauty products. The results included within the Other segment are not material to the Company’s consolidated results of operations.

The Company's management evaluates segment profit, which is defined as income from continuing operations before interest, taxes, depreciation, amortization, stock-based compensation expense, gains/losses on foreign currency fluctuations, gains/losses on the early extinguishment of debt and miscellaneous expenses, for each of the Company's reportable segments. Segment profit also excludes unallocated corporate expenses and the impact of certain items that are not directly attributable to the reportable segments' underlying operating performance, which includes the impacts of: (i) restructuring and related charges; (ii) acquisition and integration costs; (iii) deferred compensation costs; (iv) costs of sales resulting from a fair value adjustment to inventory acquired in the Elizabeth Arden Acquisition; and (v) charges related to the Elizabeth Arden 2016 Business Transformation Program. Such items are shown below in the table reconciling segment profit to consolidated income from continuing operations before income taxes. Unallocated corporate expenses primarily include general and administrative expenses related to the corporate organization. These expenses are recorded in unallocated corporate expenses, as these items are centrally directed and controlled and are not included in internal measures of segment operating performance. The Company does not have any material inter-segment sales.

The accounting policies for each of the reportable segments are the same as those described in Note 1, “Description of Business and Summary of Significant Accounting Policies.” The Company's assets and liabilities are managed centrally and are reported internally in the same manner as the Unaudited Consolidated Financial Statements; thus, no additional information regarding assets and liabilities of the Company’s reportable segments is produced for the Company's Chief Executive Officer or included in these Unaudited Consolidated Financial Statements.

The following table is a comparative summary of the Company’s net sales and segment profit by reportable segment for each of the three and nine months ended September 30, 2017 and 2016.



	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
Segment Net Sales:
Consumer	$	306.7		$	342.8		$	932.8		$	1,022.3
Elizabeth Arden	248.1			135.2			639.3			135.2
Professional	107.0			118.8			320.4			357.2
Other	4.7			8.0			14.6			18.6
Total	$	666.5		$	604.8		$	1,907.1		$	1,533.3

Segment Profit:
Consumer	$	33.0		$	81.0		$	134.5		$	220.4
Elizabeth Arden	31.6			32.5			65.5			32.5
Professional	18.9			23.7			44.5			73.4
Other	(1.0		)	(0.1		)	(2.5		)	(0.9		)
Total	$	82.5		$	137.1		$	242.0		$	325.4

Reconciliation:
Segment Profit	$	82.5		$	137.1		$	242.0		$	325.4
Less:
Unallocated corporate expenses	28.9			24.2			95.2			59.1
Depreciation and amortization	37.9			28.8			111.7			81.0
Non-cash stock compensation expense	1.5			1.5			5.9			4.8
Non-Operating items:
Restructuring and related charges	6.6			0.5			12.3			2.3
Acquisition and integration costs	12.7			33.5			40.2			39.5
Elizabeth Arden 2016 Business Transformation Program	0.1			1.7			0.8			1.7
Elizabeth Arden inventory purchase accounting adjustment, cost of sales	—			4.2			17.2			4.2
Cutex International inventory purchase accounting adjustment, cost of sales	—			0.2			—			0.3
Deferred compensation	0.3			0.8			2.0			2.6
Operating (loss) income	(5.5		)	41.7			(43.3		)	129.9
Less:
Interest Expense	38.6			27.4			110.3			69.3
Amortization of debt issuance costs	2.3			1.7			6.8			4.6
Loss on early extinguishment of debt	—			16.9			—			16.9
Foreign currency (gains) losses, net	(3.1		)	1.2			(16.8		)	6.3
Miscellaneous, net	0.3			(0.6		)	1.8			(0.1		)
(Loss) income from continuing operations before income taxes	$	(43.6	)	$	(4.9	)	$	(145.4	)	$	32.9

As of September 30, 2017, after giving effect to the Elizabeth Arden Acquisition, the Company had operations established in 27 countries outside of the U.S. and its products are sold throughout the world. Generally, net sales by geographic area are presented by attributing revenues from external customers on the basis of where the products are sold.



	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
Geographic area:
Net sales:
United States	$	311.7	47%	$	326.1	54%	$	916.2	48%	$	836.8	55%
International	354.8		53%	278.7		46%	990.9		52%	696.5		45%
	$	666.5		$	604.8		$	1,907.1		$	1,533.3



	September 30, 2017			December 31, 2016
Long-lived assets, net:
United States	$	1,478.2	84%	$	1,494.3	85%
International	283.9		16%	255.4		15%
	$	1,762.1		$	1,749.7



	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
Classes of similar products:
Net sales:
Color cosmetics	$	221.3	33%	$	245.5	41%	$	681.6	36%	$	731.7	48%
Fragrance	197.6		30%	127.8		21%	487.7		26%	154.9		10%
Hair care	126.0		19%	135.3		22%	383.7		20%	402.1		26%
Beauty care	69.3		10%	94.1		16%	198.0		10%	236.9		15%
Skin care	52.3		8%	2.1		—%	156.1		8%	7.7		1%
	$	666.5		$	604.8		$	1,907.1		$	1,533.3