Guarantor Financial Information

9 Months Ended

Sep. 30, 2011

Guarantor Financial Information

Guarantor Financial Information

(13) Guarantor Financial Information

Products Corporation's 9 ³/4% Senior Secured Notes are fully and unconditionally guaranteed on a senior secured basis by Revlon, Inc. and Products Corporation's domestic subsidiaries (other than certain immaterial subsidiaries) that guarantee Products Corporation's obligations under its 2011 Credit Agreements (the "Guarantor Subsidiaries").

The following Condensed Consolidating Financial Statements present the financial information as of September 30, 2011 and December 31, 2010, and for the three and nine months ended September 30, 2011 and 2010 for (i) Products Corporation on a stand-alone basis; (ii) the Guarantor Subsidiaries on a stand-alone basis; (iii) the subsidiaries of Products Corporation that do not guarantee Products Corporation's 9 ³/4% Senior Secured Notes (the "Non-Guarantor Subsidiaries") on a stand-alone basis; and (iv) Products Corporation, the Guarantor Subsidiaries and the Non-Guarantor Subsidiaries on a consolidated basis. The Condensed Consolidating Financial Statements are presented on the equity method, under which the investments in subsidiaries are recorded at cost and adjusted for the applicable share of the subsidiary's cumulative results of operations, capital contributions, distributions and other equity changes. The principal elimination entries eliminate investments in subsidiaries and intercompany balances and transactions.

Consolidating Condensed Balance Sheets

As of September 30, 2011

	Products Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
ASSETS
Cash and cash equivalents	$	17.9		$	0.1		$	31.9		$	—		$	49.9
Trade receivables, less allowances for doubtful accounts		73.5			22.7			89.3			—			185.5
Inventories		87.4			10.8			45.4			—			143.6
Deferred income taxes — current		38.4			—			5.6			—			44.0
Prepaid expenses and other		78.9			5.3			25.4			—			109.6
Intercompany receivables		911.1			439.6			347.6			(1,698.3	)		—
Investment in subsidiaries		(201.0	)		(200.6	)		—			401.6			—
Property, plant and equipment, net		86.3			0.8			12.9			—			100.0
Deferred income taxes — noncurrent		192.6			—			2.4			—			195.0
Goodwill, net		150.6			41.4			1.9			—			193.9
Other assets		49.8			25.6			30.4			—			105.8
Total assets	$	1,485.5		$	345.7		$	592.8		$	(1,296.7	)	$	1,127.3
LIABILITIES AND STOCKHOLDER'S DEFICIENCY
Short-term borrowings	$	—		$	6.0		$	3.2		$	—		$	9.2
Current portion of long-term debt		8.0			—			—			—			8.0
Accounts payable		57.8			4.7			29.4			—			91.9
Accrued expenses and other		127.2			14.1			69.8			—			211.1
Intercompany payables		539.1			615.4			543.8			(1,698.3	)		—
Long-term debt		1,108.6			—			—			—			1,108.6
Long-term debt — affiliates		107.0			—			—			—			107.0
Other long-term liabilities		174.1			6.9			46.8			—			227.8
Total liabilities		2,121.8			647.1			693.0			(1,698.3	)		1,763.6
Stockholder's deficiency		(636.3	)		(301.4	)		(100.2	)		401.6			(636.3	)
Total liabilities and stockholder's deficiency	$	1,485.5		$	345.7		$	592.8		$	(1,296.7	)	$	1,127.3

Consolidating Condensed Balance Sheets

As of December 31, 2010

	Products Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
ASSETS
Cash and cash equivalents	$	20.5		$	0.1		$	56.1		$	—		$	76.7
Trade receivables, less allowances for doubtful accounts		91.0			14.9			91.6			—			197.5
Inventories		76.6			2.4			36.0			—			115.0
Deferred income taxes — current		34.4			—			5.9			—			40.3
Prepaid expenses and other		72.5			3.2			22.4			—			98.1
Intercompany receivables		895.1			432.0			331.1			(1,658.2	)		—
Investment in subsidiaries		(229.8	)		(184.7	)		—			414.5			—
Property, plant and equipment, net		89.4			0.6			16.2			—			106.2
Deferred income taxes — noncurrent		214.0			—			2.6			—			216.6
Goodwill, net		150.6			30.0			2.1			—			182.7
Other assets		55.8			4.2			27.3			—			87.3
Total assets	$	1,470.1		$	302.7		$	591.3		$	(1,243.7	)	$	1,120.4
LIABILITIES AND STOCKHOLDER'S DEFICIENCY
Short-term borrowings	$	—		$	1.8		$	1.9		$	—		$	3.7
Current portion of long-term debt		8.0			—			—			—			8.0
Accounts payable		54.3			4.4			25.8			—			84.5
Accrued expenses and other		140.1			9.0			67.1			—			216.2
Intercompany payables		516.4			613.4			528.4			(1,658.2	)		—
Long-term debt		1,100.9			—			—			—			1,100.9
Long-term debt — affiliates		107.0			—			—			—			107.0
Other long-term liabilities		200.5			9.1			47.6			—			257.2
Total liabilities		2,127.2			637.7			670.8			(1,658.2	)		1,777.5
Stockholder's deficiency		(657.1	)		(335.0	)		(79.5	)		414.5			(657.1	)
Total liabilities and stockholder's deficiency	$	1,470.1		$	302.7		$	591.3		$	(1,243.7	)	$	1,120.4

Consolidating Condensed Statement of Operations

For the Three Months Ended September 30, 2011

	Products Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net Sales	$	212.2		$	28.1		$	139.7		$	(42.8	)	$	337.2
Cost of Sales		98.9			13.3			53.7			(42.8	)		123.1
Gross profit		113.3			14.8			86.0			—			214.1
Selling, general and administrative expenses		96.5			11.8			59.4			—			167.7
Operating income		16.8			3.0			26.6			—			46.4
Other expenses (income):
Intercompany interest, net		—			(0.3	)		1.8			—			1.5
Interest expense		20.2			0.1			0.1			—			20.4
Amortization of debt issuance costs		0.8			—			—			—			0.8
Loss on early extinguishment of debt		—			—			—			—			—
Foreign currency gains, net		(0.2	)		—			(0.7	)		—			(0.9	)
Miscellaneous, net		(8.5	)		(3.8	)		12.5			—			0.2
Other expenses (income), net		12.3			(4.0	)		13.7			—			22.0
Income from continuing operations before income taxes		4.5			7.0			12.9			—			24.4
Provision for (benefit from) income taxes		12.5			(0.5	)		7.1			—			19.1
(Loss) income from continuing operations		(8.0	)		7.5			5.8			—			5.3
Equity in income of subsidiaries		13.3			1.5			—			(14.8	)		—
Net income	$	5.3		$	9.0		$	5.8		$	(14.8	)	$	5.3

Consolidating Condensed Statement of Operations

For the Three Months Ended September 30, 2010

	Products Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Net Sales	$	196.7		$	20.5		$	137.9	$	(36.1	)	$	319.0
Cost of Sales		85.4			9.2			51.9		(36.1	)		110.4
Gross profit		111.3			11.3			86.0		—			208.6
Selling, general and administrative expenses		101.2			8.4			58.3		—			167.9
Operating income		10.1			2.9			27.7		—			40.7
Other expenses (income):
Intercompany interest, net		0.7			(0.4	)		1.3		—			1.6
Interest expense		22.9			0.1			0.1		—			23.1
Amortization of debt issuance costs		1.1			—			—		—			1.1
Foreign currency (gains) losses, net		(0.3	)		—			1.1		—			0.8
Miscellaneous, net		(7.0	)		(3.8	)		11.1		—			0.3
Other expenses (income), net		17.4			(4.1	)		13.6		—			26.9
(Loss) income from continuing operations before income taxes		(7.3	)		7.0			14.1		—			13.8
(Benefit from) provision for income taxes		(1.5	)		0.3			0.7		—			(0.5	)
(Loss) income from continuing operations		(5.8	)		6.7			13.4		—			14.3
Loss from discontinued operations, net of taxes		(0.1	)		—			—		—			(0.1	)
Equity in income of subsidiaries		20.1			10.0			—		(30.1	)		—
Net income	$	14.2		$	16.7		$	13.4	$	(30.1	)	$	14.2

Consolidating Condensed Statement of Operations

For the Nine Months Ended September 30, 2011

	Products Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Net Sales	$	659.2		$	71.8		$	420.4	$	(129.8	)	$	1,021.6
Cost of Sales		295.6			33.2			159.3		(129.8	)		358.3
Gross profit		363.6			38.6			261.1		—			663.3
Selling, general and administrative expenses		300.4			31.4			188.3		—			520.1
Operating income		63.2			7.2			72.8		—			143.2
Other expenses (income):
Intercompany interest, net		(0.1	)		(0.8	)		5.5		—			4.6
Interest expense		64.2			0.2			0.3		—			64.7
Amortization of debt issuance costs		2.9			—			—		—			2.9
Loss on early extinguishment of debt, net		11.3			—			—		—			11.3
Foreign currency (gains) losses, net		(1.4	)		0.4			3.4		—			2.4
Miscellaneous, net		(43.1	)		3.4			40.9		—			1.2
Other expenses, net		33.8			3.2			50.1		—			87.1
Income from continuing operations before income taxes		29.4			4.0			22.7		—			56.1
Provision for income taxes		16.6			1.9			13.1		—			31.6
Income from continuing operations		12.8			2.1			9.6		—			24.5
Income from discontinued operations, net of taxes		0.6			—			—		—			0.6
Equity in income of subsidiaries		11.7			0.4			—		(12.1	)		—
Net income	$	25.1		$	2.5		$	9.6	$	(12.1	)	$	25.1

Consolidating Condensed Statement of Operations

For the Nine Months Ended September 30, 2010

	Products Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Net Sales	$	620.0		$	50.7		$	389.4	$	(107.9	)	$	952.2
Cost of Sales		265.0			22.3			146.7		(107.9	)		326.1
Gross profit		355.0			28.4			242.7		—			626.1
Selling, general and administrative expenses		297.1			24.8			167.1		—			489.0
Operating income		57.9			3.6			75.6		—			137.1
Other expenses (income):
Intercompany interest, net		2.2			(1.0	)		3.5		—			4.7
Interest expense		67.0			0.2			0.2		—			67.4
Amortization of debt issuance costs		3.5			—			—		—			3.5
Loss on early extinguishment of debt, net		9.7			—			—		—			9.7
Foreign currency (gains) losses, net		(4.6	)		(0.2	)		9.5		—			4.7
Miscellaneous, net		(35.9	)		3.6			33.2		—			0.9
Other expenses, net		41.9			2.6			46.4		—			90.9
Income from continuing operations before income taxes		16.0			1.0			29.2		—			46.2
(Benefit from) provision for income taxes		(2.8	)		3.0			9.1		—			9.3
Income (loss) from continuing operations		18.8			(2.0	)		20.1		—			36.9
Income from discontinued operations, net of taxes		0.3			—			—		—			0.3
Equity in income of subsidiaries		18.1			8.6			—		(26.7	)		—
Net income	$	37.2		$	6.6		$	20.1	$	(26.7	)	$	37.2

Consolidating Condensed Statement of Cash Flow

For the Nine Months Ended September 30, 2011

	Products Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash provided by (used in) operating activities	$	6.1		$	34.9		$	(20.8	)	$	—	$	20.2
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		(8.2	)		(0.2	)		(1.2	)		—		(9.6	)
Acquisition		—			(39.0	)		—			—		(39.0	)
Proceeds from sales of certain assets		0.1			—			0.1			—		0.2
Net cash used in investing activities		(8.1	)		(39.2	)		(1.1	)		—		(48.4	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase in short-term borrowings and overdraft		4.1			4.3			1.6			—		10.0
Repayments under the 2010 Term Loan Facility		(794.0	)		—			—			—		(794.0	)
Borrowings under the 2011 Term Loan Facility		796.0			—			—			—		796.0
Repayments under the 2011 Term Loan Facility		(2.0	)		—			—			—		(2.0	)
Payment of financing costs		(4.2	)		—			—			—		(4.2	)
Other financing activities		(0.5	)		—			(0.7	)		—		(1.2	)
Net cash (used in) provided by financing activities		(0.6	)		4.3			0.9			—		4.6
Effect of exchange rate changes on cash and cash equivalents		—			—			(3.2	)		—		(3.2	)
Net decrease in cash and cash equivalents		(2.6	)		—			(24.2	)		—		(26.8	)
Cash and cash equivalents at beginning of period		20.5			0.1			56.1			—		76.7
Cash and cash equivalents at end of period	$	17.9		$	0.1		$	31.9		$	—	$	49.9

Consolidating Condensed Statement of Cash Flow

For the Nine Months Ended September 30, 2010

	Products Corporation			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash provided by (used in) operating activities	$	45.4		$	(2.4	)	$	6.5		$	—	$	49.5
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		(10.2	)		(0.1	)		(1.1	)		—		(11.4	)
Proceeds from sales of certain assets		—			—			0.2			—		0.2
Net cash used in investing activities		(10.2	)		(0.1	)		(0.9	)		—		(11.2	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net (decrease) increase in short-term borrowings and overdraft		(7.9	)		2.6			2.4			—		(2.9	)
Repayments under the 2006 Term Loan Facility		(815.0	)		—			—			—		(815.0	)
Borrowings under the 2010 Term Loan Facility		786.0			—			—			—		786.0
Repayments under the 2010 Term Loan Facility		(4.0	)		—			—			—		(4.0	)
Payment of financing costs		(17.0	)		—			—			—		(17.0	)
Other financing activities		(0.3	)		—			(0.3	)		—		(0.6	)
Net cash (used in) provided by financing activities		(58.2	)		2.6			2.1			—		(53.5	)
Effect of exchange rate changes on cash and cash equivalents		—			—			1.2			—		1.2
Net (decrease) increase in cash and cash equivalents		(23.0	)		0.1			8.9			—		(14.0	)
Cash and cash equivalents at beginning of period		27.4			0.4			26.7			—		54.5
Cash and cash equivalents at end of period	$	4.4		$	0.5		$	35.6		$	—	$	40.5