Helen of Troy Limited (NASDAQ: HELE), designer, developer and worldwide marketer of consumer brand-name housewares, health and home and beauty products, announced today that it has, through its subsidiaries, entered into an amended and extended Trademark License Agreement with Revlon to license Revlon’s trademark for hair care appliances and tools (the “Revlon License”). The terms of the Revlon License grant Helen of Troy an exclusive, global, fully paid-up license to use the Revlon trademark to manufacture, sell and distribute licensed merchandise through December 31, 2060 with, at our option, three additional 20-year auto renewal periods. In exchange for this 100-year exclusive global license, the Company paid a one-time, up-front license fee of $72.5 million in cash and will no longer pay ongoing royalties. The transaction implies a multiple of less than 9 times estimated fiscal year 2022 after-tax cash flows and provides for long-term continuity of our right to use the Revlon trademark and related intellectual property. The transaction also leverages our strong balance sheet and efficient debt structure to further accelerate our value creation flywheel. The up-front license fee of $72.5 million is expected to be funded using the Company’s cash on hand.
Julien R. Mininberg, Chief Executive Officer, stated: “Revlon has been an important brand in Helen of Troy’s Beauty portfolio since 1992. As part of Helen of Troy’s overall transformation, our global hair appliance business has more than doubled in recent years and made significant gains in profitability and market share. Our Revlon products have led the way in the United States, Canada, Europe, and Latin America. Outstanding innovation has been a key driver in delighting consumers and winning awards around the world. Our strong portfolio of Beauty brands is now the market share leader online in the U.S. hair appliance category, a share leader in several of the largest U.S. brick & mortar customers, and growing rapidly in all major channels.
The fully paid up 100-year Revlon License we are announcing today is a major step forward in Helen of Troy’s plan to continue strengthening and growing its Beauty business. We preserved global rights to the brand in all the same categories and channels as before, with favorable terms and compelling economics. In addition to our owned brands of HOT TOOLS, Drybar, and Gold ‘N Hot, further expanding Revlon plays a critical role in our overall Good/Better/Best strategy for continued growth in global hair appliances. We would like to thank Revlon Inc. for their continued faith in Helen of Troy and in our stewardship of the Revlon brand.”
About Helen of Troy Limited
Helen of Troy Limited (NASDAQ: HELE) is a leading global consumer products company offering creative solutions for its customers through a strong portfolio of well-recognized and widely trusted brands, including OXO, Hydro Flask, Vicks, Braun, Honeywell, PUR, Hot Tools, and Drybar. We sometimes refer to these brands as our Leadership Brands. All trademarks herein belong to Helen of Troy Limited (or its subsidiaries) and/or are used under license from their respective licensors.
For more information about Helen of Troy, please visit http://investor.helenoftroy.com/
Forward Looking Statements
Certain written and oral statements made by the Company and subsidiaries of the Company may constitute “forward-looking statements” as defined under the Private Securities Litigation Reform Act of 1995. This includes statements made in this press release. Generally, the words “anticipates”, “believes”, “expects”, “plans”, “may”, “will”, “should”, “seeks”, “estimates”, “project”, “predict”, “potential”, “continue”, “intends”, and other similar words identify forward-looking statements. All statements that address operating results, events or developments that the Company expects or anticipates will occur in the future, including statements related to sales, earnings per share results, and statements expressing general expectations about future operating results, are forward-looking statements and are based upon its current expectations and various assumptions. The Company believes there is a reasonable basis for these expectations and assumptions, but there can be no assurance that the Company will realize these expectations or that these assumptions will prove correct. Forward-looking statements are subject to risks that could cause them to differ materially from actual results. Accordingly, the Company cautions readers not to place undue reliance on forward-looking statements. The forward-looking statements contained in this press release should be read in conjunction with, and are subject to and qualified by, the risks described in the Company’s Form 10-K for the year ended February 29, 2020, and in the Company's other filings with the SEC. Investors are urged to refer to the risk factors referred to above for a description of these risks. Such risks include, among others, our ability to successfully manage the demand, supply and operational challenges associated with the actual or perceived effects of COVID-19 and any similar future public health crisis, pandemic or epidemic, our ability to deliver products to our customers in a timely manner and according to their fulfillment standards, the costs of complying with the business demands and requirements of large sophisticated customers, our dependence on the strength of retail economies and vulnerabilities to any prolonged economic downturn, including from the effects of COVID-19, our relationships with key customers and licensors, our dependence on sales to several large customers and the risks associated with any loss or substantial decline in sales to top customers, expectations regarding recent, pending and future acquisitions or divestitures, including our ability to realize anticipated cost savings, synergies and other benefits along with our ability to effectively integrate acquired businesses or separate divested businesses, circumstances which may contribute to future impairment of goodwill, intangible or other long-lived assets, the retention and recruitment of key personnel, the costs, complexity and challenges of upgrading and managing our global information systems, the risks associated with cybersecurity and information security breaches, the risks associated with global legal developments regarding privacy and data security could result in changes to our business practices, penalties, increased cost of operations, or otherwise harm our business, risks associated with foreign currency exchange rate fluctuations, the risks associated with accounting for tax positions, tax audits and related disputes with taxing authorities, the risks of potential changes in laws in the U.S. or abroad, including tax laws, regulations or treaties, employment and health insurance laws and regulations, laws relating to environmental policy, personal data, financial regulation, transportation policy and infrastructure policy along with the costs and complexities of compliance with such laws, our ability to continue to avoid classification as a controlled foreign corporation, the risks of new legislation enacted in Bermuda and Barbados in response to the European Union’s review of harmful tax competition, risks associated with weather conditions, the duration and severity of the cold and flu season and other related factors, our dependence on foreign sources of supply and foreign manufacturing, and associated operational risks including, but not limited to, long lead times, consistent local labor availability and capacity, and timely availability of sufficient shipping carrier capacity, the impact of changing costs of raw materials, labor and energy on cost of goods sold and certain operating expenses, the risks associated with significant tariffs or other restrictions on imports from China or any retaliatory trade measures taken by China, the risks associated with the geographic concentration and peak season capacity of certain U.S. distribution facilities, our projections of product demand, sales and net income are highly subjective in nature and future sales and net income could vary in a material amount from such projections, the risks associated with the use of trademarks licensed from and to third parties, our ability to develop and introduce a continuing stream of new products to meet changing consumer preferences, trade barriers, exchange controls, expropriations, and other risks associated with U.S. and foreign operations, the risks to our liquidity as a result of changes to capital market conditions and other constraints or events that impose constraints on our cash resources and ability to operate our business, the risks associated with product recalls, product liability, other claims, and related litigation against us and the risks associated with changes in regulations or product certifications.
Helen of Troy Limited
Anne Rakunas, Director, External Communications