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Coty’s Turnaround Plan Takes Aim At Excess Complexity; $3bn Write-down Reflects P&G Brands’ Erosion

 
• By Ryan Nelson

The firm’s “realistic” four-year plan, unveiled 1 July, is designed “to build a better business … while we gradually prepare for growth.” The turnaround effort is expected to cost Coty $600m over the 2020-2023 period and includes a $3bn impairment charge, largely within its ailing Consumer Beauty unit, to be recorded in fiscal 2019.

A professional businessman thinking while standing on a black arrow pointing forward in grey space concept

[Coty Inc.] has acknowledged that the 40-plus brands it acquired from Procter & Gamble Co. in 2016 face a radically different market today than they did three years ago, and that integration of those brands has been a “longer and more complex” undertaking than originally expected.

Still, investors may have underestimated the extent to which former P&G assets have staled in a cosmetics space brimming with flashy upstarts and the

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