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Coty Maintains Momentum in Q2 Continued Improvement In Profit and Net Debt Reduction , with Revenues In Line FY21 Fixed Cost Savings Target Increased to ~ $ 300M Strong Strategic Progress in Prestige Business Especially in U.S. and China , and E - Commerce NEW YORK - February 9 , 2021-- Coty Inc. ( NYSE : COTY ) today announced continued improvement in financial results for the second quarter of fiscal year 2021 , ended December 31 , 2020 . In Q2 , Coty reported adjusted operating income of $ 188.4 million , up 7 % versus last year , with a reported operating income of $ 17.0 million . Strong profit performance in the quarter was fueled by fixed costs savings , which totaled approximately $ 80 million , consistent with Q1 . The strong delivery in 1H21 coupled with the acceleration of certain projects into the year are driving an increase to the savings target for FY21 , now expected to be approximately $ 300 million compared to the previous target of over $ 200 million . For the quarter , the operational improvements and stringent cost controls resulted in Adjusted EPS for Total Coty of $ 0.17 , which includes two months of contribution from Wella , while reported EPS was $ ( 0.36 ) driven by the impact of the cost of the Wella transaction as well as additional restructuring accruals under the fixed cost savings plan . The Wella divestiture closed as planned on November 30 , delivering $ 2.9 billion gross proceeds . Combined with free cash flow of $ 389.4 million , Financial Net Debt fell to approximately $ 4.8 billion at the end of Q2 . Economic Net Debt , which includes the stake in Wella valued at quarter end at approximately $ 1.2 billion¹ , fell to approximately $ 3.6 billion . Coty has elected to recognize its Wella stake on a fair value basis going forward , as permitted by U.S. GAAP . Separately , Coty will now use Adjusted EBITDA as a key performance measure , in order to more directly drive and highlight its focus on cash flow and deleveraging , which remains a priority . Adjusted EBITDA was $ 449.9 million for 1H21 , up 6 % versus the last year , and is expected to be $ 750 million in FY21 . Revenues continued to improve in the second quarter , with a 16 % revenue decline on a reported basis , or an 18 % LFL decline which was 1 percentage point ahead of Q1 , despite the resurgence of COVID and related lockdowns in multiple parts of the world . The Prestige business saw the biggest gain , with LFL trends better by 9 percentage points sequentially , even as the travel retail channel remained under pressure . Within the prestige business , which accounted for approximately 60 % of net revenues in the first half of FY21 , highlights for the quarter included strong retail sales momentum in the U.S. and China , and broad - based strength in e - commerce . Coty continues to make progress on its strategic priorities , including digital and e - commerce acceleration , which grew 40 % in Q2 , expanding into white space opportunities including prestige cosmetics and skincare , building out its presence in China , and strengthening its core prestige fragrance business and stabilizing share in the mass beauty business through leading innovation and improved execution . Commenting on the operating results , Sue Y. Nabi , Coty's CEO , said : " Our strong second quarter results build on the momentum of the first quarter , as the entire organization continued to act with discipline , flexibility and creativity in an uncertain environment . With revenues delivering on our objectives and profit , cash flow and debt all ahead of expectations , including 6 % EBITDA growth , it is clear that a much stronger Coty is emerging , which we believe will weather any near - term market headwinds while simultaneously positioned strongly to capture the opportunities of the eventual global recovery . Entering Q3 , January trends are starting inline with our expectations . The strong execution on our fixed cost savings plan , with approximately $ 160 million of savings generated in the first half of FY21 , and a solid pipeline of projects for the second half , give us confidence to raise our savings target for the full year to approximately $ 300 million . The additional savings will allow us to protect our profitability in the coming months of uncertainty while simultaneously freeing up funds to increase our A & CP investments in the second half of FY21 to support our carefully chosen strategic initiatives . We continued to progress on our strategic objectives during the quarter . Our e - commerce momentum , with 40 % sales growth was broad - based , spanning the prestige and mass businesses , across key regions , and fueled by success in pureplay e - retailers , brick & click retailers , and DTC . Our China prestige business continues to grow , with strong fragrance sell - out and the more than doubling of retail sales for both Gucci and Burberry cosmetics , speaking to the strong appeal of both brands to Chinese consumers . And we have continued building on Gucci's momentum in China , with the opening this week of the Gucci Beauty flagship store on Tmall , for which we see tremendous potential in the coming years . And in our core business , we continue to deliver leading innovation in both prestige and mass . I am delighted to see Marc Jacobs Perfect ending the year as the # 1 fragrance launch of CY20 in the 1