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EQUITY AND CONVERTIBLE PREFERRED STOCK | 6 Months Ended
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Dec. 31, 2021
Equity [Abstract] |
EQUITY AND CONVERTIBLE PREFERRED STOCK | EQUITY AND CONVERTIBLE PREFERRED STOCK Common Stock As of December 31, 2021, the Company’s common stock consisted of Class A Common Stock with a par value of $0.01 per share. The holders of Class A Common Stock are entitled to one vote per share. As of December 31, 2021, total authorized shares of Class A Common Stock was 1,250.0 million and total outstanding shares of Class A Common Stock was 838.7 million. As of December 31, 2021, the Company’s largest stockholder was Cottage Holdco B.V., which owned approximately 54% of Coty’s outstanding Class A Common Stock. Cottage Holdco B.V., a wholly-owned subsidiary of JAB Cosmetics B.V. (“JABC”), is indirectly controlled by Lucresca SE, Agnaten SE and JAB Holdings B.V. (“JAB”). The Company’s CEO, Sue Nabi, was granted a one-time sign-on award of restricted stock units (the “Award”) on June 30, 2021. On October 29, 2021, Cottage Holdco B.V. completed the transfer of 10.0 million shares of Common Stock to Ms. Nabi in connection with her sign-on award of restricted stock units. See Note 17—Share-Based Compensation Plans for additional information. Series A and A-1 Preferred Stock As of December 31, 2021, total authorized shares of preferred stock are 20.0 million. There are two classes of Preferred Stock, Series A Preferred Stock and Series A-1 Preferred Stock, both with a par value of $0.01 per share. As of December 31, 2021, there were 1.5 million shares of Series A and no shares of Series A-1 Preferred Stock authorized, issued and outstanding. Series A Preferred Stock and Series A-1 Preferred Stock are not entitled to receive any dividends and have no voting rights except as required by law. As of December 31, 2021, the Company has $1.7 Series A Preferred Stock classified as a liability recorded in Other noncurrent liabilities in the Condensed Consolidated Balance Sheet. Convertible Series B Preferred Stock On May 11, 2020, the Company entered into an Investment Agreement with KKR Aggregator, relating to the issuance and sale by the Company to KKR Aggregator of up to 1,000,000 shares of the Company’s new Convertible Series B Preferred Stock, par value $0.01 per share (the “Series B Preferred Stock”), for an aggregate purchase price of up to $1,000.0, or $1,000 per share (the “Issuance”). The Issuance was proposed to be issued in two tranches: (i) an initial issuance of 750,000 shares of Series B Preferred Stock (the “Initial Issuance”) and (ii) a subsequent issuance of 250,000 shares of Series B Preferred Stock (the “Second Issuance”), which was subject to the execution and delivery of a definitive purchase agreement between the Company and KKR Aggregator or certain of its affiliates in respect of the Wella Business. On May 26, 2020 (the “Closing Date”), the Company and KKR Aggregator completed the issuance and sale of 750,000 shares of Series B Preferred Stock for an aggregate purchase price of $750.0. On July 31, 2020, the Company completed the sale of 250,000 shares of the Company’s Series B Preferred Stock to KKR Aggregator for an aggregate purchase price of $250.0. On November 16, 2020, KKR Aggregator and affiliated investment funds agreed to sell 146,057 shares of Series B Preferred Stock, to HFS Holdings S.à r.l, that is beneficially owned by Peter Harf, a director of the Company. The transaction, which was subject to customary closing conditions, closed on August 27, 2021. On September 10, 2021, KKR Aggregator converted 285,576 shares of Series B Preferred Stock, and $26.4 of unpaid dividends into 50,000,088 shares of Class A common stock. Immediately after the conversion, KKR Aggregator completed the public secondary offering of 50,000,088 shares of Class A common stock. The Company did not receive any proceeds from the sale of the shares of Class A Common Stock by KKR Aggregator. As a result of the conversion, the Company measured the accrued dividends at fair value, which resulted in an increase of $6.7. Such adjustment is considered a deemed dividend for purposes of calculating basic and diluted EPS. On September 30, 2021, the Company entered into a definitive agreement to sell a 9.4% stake in Wella to KKR Aggregator in exchange for the redemption of 290,465 shares of Series B Preferred Stock and $22.5 of unpaid dividends, as previously defined as the First Exchange. As a result, the Series B Preferred Stock, net of issuance costs, and related accrued dividends were reclassified from temporary equity to a liability as Mandatorily redeemable Convertible Series B Preferred Stock as of September 30, 2021. Upon reclassification, the Company measured the Series B Preferred Stock and accrued dividends at fair value, which resulted in an increase of $93.6. The excess in fair value is considered a deemed dividend for purposes of calculating basic and diluted EPS. The First Exchange was completed on October 20, 2021. Upon closing, the Company re-measured the Series B Preferred Stock and accrued dividends at fair value, which resulted in a decrease of $6.5. Such adjustment is considered a gain on extinguishment and is included in Other (income) expense, net in the Consolidated Statements of Operations. A key input in determining the fair value of the liability was based on the Company's share price as of the measurement date. As this liability is not actively traded, it is classified as a Level 2 fair value measurements. Upon closing of the First Exchange, the Company recognized a non-monetary loss of $2.9 and is included in Other (income) expense, net in the Consolidated Statements of Operations. See Note 9—Equity Investments for additional information. On November 10, 2021, KKR Aggregator converted 123,219 shares of Series B Preferred Stock, and $1.2 of unpaid dividends into 19,944,701 shares of Class A common stock. Immediately after the conversion, KKR Aggregator completed a sale of 19,944,701 shares of Class A common stock. The Company did not receive any proceeds from the sale of the shares of Class A Common Stock by KKR Aggregator. As a result of the conversion, the Company measured the accrued dividends at fair value, which resulted in an increase of $0.8. Such adjustment is considered a deemed dividend for purposes of calculating basic and diluted EPS. On November 6, 2021, the Company entered into a definitive agreement to sell an additional 4.7% stake in Wella to KKR Aggregator in exchange for the redemption or conversion of 154,683 shares of Series B Preferred Stock, as previously defined as the Second Exchange. The Second Exchange closed on November 30, 2021. Upon closing, the Company recognized $66.4 in excess of the fair value of the consideration transferred in exchange for the redemption of the Series B Preferred Stock. The excess in fair value is considered a deemed dividend for purposes of calculating basic and diluted EPS. As of December 31, 2021, KKR has fully redeemed/exchanged all of their Series B Preferred Stock. See Note 9—Equity Investments for additional information. In October 2021, the Company paid the remaining accrued unpaid dividends on the Series B Preferred Stock that were outstanding as of June 30, 2021, totaling $25.1. As a result, $4.4 of previously recorded fair value adjustments for unpaid dividends were reversed through additional paid-in capital (“APIC”) and is considered a deemed contribution. Cumulative preferred dividends accrue daily on the Series B Preferred Stock at a rate of 9.0% per year. During the three months ended December 31, 2021, the Board of Directors declared dividends on the Series B Preferred Stock of $5.9, of which $1.4 was paid and $1.2 was converted as part of the November 10, 2021 conversion. Additionally, the Company also paid the remaining accrued unpaid dividends on the Series B Preferred Stock that were outstanding as of September 30, 2021, totaling 19.2. During the six months ended December 31, 2021, the Board of Directors declared dividends on the Series B Preferred Stock of $28.6 of which $24.1 was paid and $1.2 was converted as part of the November 10, 2021 conversion. The Series B Preferred Stock had accrued unpaid dividends of $3.3 and $74.1 as of December 31, 2021 and June 30, 2021, respectively. Treasury Stock Share Repurchase Program Since February 2014, the Board has authorized the Company to repurchase its Class A Common Stock under approved repurchase programs. On February 3, 2016, the Board authorized the Company to repurchase up to $500.0 of its Class A Common Stock (the “Incremental Repurchase Program”). Repurchases may be made from time to time at the Company’s discretion, based on ongoing assessments of the capital needs of the business, the market price of its Class A Common Stock, and general market conditions. For the three and six months ended December 31, 2021, the Company did not repurchase any shares of its Class A Common Stock. As of December 31, 2021, the Company had authority for $396.8 remaining under the Incremental Repurchase Program. Other Repurchases There were no other stock repurchases during the three and six months ended December 31, 2021 and 2020. Dividends On April 29, 2020, the Board of Directors suspended the payment of dividends. During fiscal 2020, prior to the Board’s decision to suspend the payment of dividends, the Company maintained a Stock Dividend Reinvestment Program and had registered a total of 19.3 million shares of Class A Common Stock for purchase under the program. All holders of records of Class A Common Stock had the opportunity to participate in the program; if a holder elected to participate in the program fifty percent (50%) of their cash dividends were reinvested in additional shares of Class A Common Stock. The change in dividends accrued recorded to APIC in the Condensed Consolidated Balance Sheet as of December 31, 2021 was $0.7, which represent dividends no longer expected to vest as a result of forfeitures of outstanding restricted stock units (“RSUs”). In addition to the activity noted above, the Company made a payment of $1.2 for the previously accrued dividends on RSUs that vested during the six months ended December 31, 2021. Total accrued dividends on unvested RSUs and phantom units of $1.5 and $0.5 are included in Accrued expenses and other current liabilities and Other noncurrent liabilities, respectively, in the Condensed Consolidated Balance Sheet as of December 31, 2021. Accumulated Other Comprehensive Income (Loss)
|  |  | Foreign Currency Translation Adjustments |  |  |  |
| (Loss) gain on Cash Flow Hedges |  | (Loss) gain on Net Investment Hedge |  | Other Foreign Currency Translation Adjustments |  | Pension and Other Post-Employment Benefit Plans (a) |  | Total
Balance—July 1, 2021 | $ | (15.5) |  |  | $ | (32.2) |  |  | $ | (259.3) |  |  | $ | (14.9) |  |  | $ | (321.9) |
Other comprehensive income (loss) before reclassifications | 2.6 |  |  | 18.9 |  |  | (269.4) |  |  | — |  |  | (247.9) |
Net amounts reclassified from AOCI/(L) | 7.3 |  |  | — |  |  | — |  |  | 2.3 |  |  | 9.6 |
Net current-period other comprehensive income (loss) | 9.9 |  |  | 18.9 |  |  | (269.4) |  |  | 2.3 |  |  | (238.3) |
Balance—December 31, 2021 | $ | (5.6) |  |  | $ | (13.3) |  |  | $ | (528.7) |  |  | $ | (12.6) |  |  | $ | (560.2) |
(a) For the six months ended December 31, 2021, net amounts reclassified from AOCI/(L) related to pensions and other post-employment benefit plans included amortization of prior service credits and actuarial loss of $2.3, net of tax of nil.
|  |  | Foreign Currency Translation Adjustments |  |  |  |
| Loss on Cash Flow Hedges |  | Gain (loss) on Net Investment Hedge |  | Other Foreign Currency Translation Adjustments |  | Pension and Other Post-Employment Benefit Plans |  | Total
Balance—July 1, 2020 | $ | (43.0) |  |  | $ | 261.9 |  |  | $ | (683.8) |  |  | $ | 8.7 |  |  | $ | (456.2) |
Other comprehensive (loss) income before reclassifications | (0.2) |  |  | (385.1) |  |  | 514.1 |  |  | — |  |  | 128.8 |
Net amounts reclassified from AOCI/(L) | 15.6 |  |  | — |  |  | — |  |  | (14.7) |  |  | 0.9 |
Net current-period other comprehensive income (loss) | 15.4 |  |  | (385.1) |  |  | 514.1 |  |  | (14.7) |  |  | 129.7 |
Balance—December 31, 2020 | $ | (27.6) |  |  | $ | (123.2) |  |  | $ | (169.7) |  |  | $ | (6.0) |  |  | $ | (326.5) |

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