RDEN Elizabeth Arden, Inc.

Elizabeth Arden, Inc. (NASDAQ: RDEN), a global prestige beauty products company, today announced that it has made an investment in Red Door Spa Holdings, the operator of the Elizabeth Arden Red Door Spas and the Mario Tricoci Hair Salons privately owned by North Castle Partners.

Elizabeth Arden, Inc. (“the Company”) licenses the trademarks for the Elizabeth Arden and Red Door brand names to Red Door Spa Holdings, the owner and operator of the Elizabeth Arden Red Door Spas. Red Door Spa Holdings is a privately-held company backed by North Castle Partners (“North Castle”), a leading investor in small-cap consumer companies focused on Health, Wellness and Active Living. Elizabeth Arden, Inc. has partnered with J.H. Anderson Holdings, Inc. and its principal John Anderson, to collectively invest $12 million for a minority interest in Red Door Spa Holdings. In addition, Elizabeth Arden, Inc. and J.H. Anderson Holdings have an option to acquire the remaining interest in Red Door Spa Holdings. The investment will be recorded as a minority investment by the Company and, therefore, it will not have a material impact on the Company’s financial results.

E. Scott Beattie, Chairman, President and Chief Executive Officer of Elizabeth Arden, Inc., commented, “Our intent in partnering with John Anderson and North Castle Partners is to accelerate the growth of the spa business in parallel with the growth of the Elizabeth Arden brand and the Elizabeth Arden brand repositioning. The collaboration between Elizabeth Arden, Inc., John Anderson and North Castle brings the relevant product, operational management and financial skills to maximize the growth potential and profitability of the Red Door Spa business. The equity of the Elizabeth Arden brand is rooted in its Red Door Spa heritage. We intend to leverage this unique association to drive both Elizabeth Arden product sales and the Red Door Spa business.”

Mr. Anderson continued, “I am extremely excited about the potential of Red Door Spas. The Elizabeth Arden Red Door Spa enjoys tremendous brand equity. As one of the most highly recognized names in the nearly $50 billion global spa industry, I look forward to leveraging this brand name in expanding the business.”

Alison Minter, North Castle Partners Managing Director, stated, “We believe the opportunity to align our economic interests and to leverage Elizabeth Arden, Inc’s. corporate resources and marketing capabilities, particularly in expanding product sales, will strengthen Red Door Spa Holdings’ leadership position in the day spa market. This transaction is another example of North Castle partnering with management teams to build high quality brands that are of strategic value to leading consumer product companies.”

Red Door Spa Holdings currently owns and operates 31 Red Door Spas in freestanding locations and upscale resort and hotel properties in the United States and 18 Mario Tricoci Hair Salons in the Chicago metro area and had combined revenue of approximately $150 million in fiscal 2011.

Mr. Anderson has been a developer, owner, and manager of hotel and resort projects. Mr. Anderson’s experience also includes spa development, management and consulting. Mr. Anderson has been involved in various hotel and spa properties, including the Hyatt Regency Pier 66, Fort Lauderdale, Florida and Sonoma Mission Inn & Spa, Sonoma, California. Sonoma Mission Inn & Spa was a pioneer in resort spas and one with a significant salon presence. A joint venture managed by Mr. Anderson created the first Ritz-Carlton Spa in San Juan, Puerto Rico, which also had a significant salon presence, under the brand name SonomaTherapy™ Spa. This spa consistently performed as one of the best spas at Ritz-Carlton properties, ranking in the upper quartile for all Ritz spas. Mr. Anderson has also provided consulting services to other hotel and resort companies, including Swissotel, Grupo Huarte, and Host Hotels.

Elizabeth Arden is a global prestige beauty products company with an extensive portfolio of prestige beauty brands sold in over 120 countries. The company's brand portfolio includes Elizabeth Arden skincare, color and fragrance products, the celebrity fragrance brands of Britney Spears, Elizabeth Taylor, Justin Bieber, Mariah Carey, Nicki Minaj, Taylor Swift, and Usher; the designer fragrance brands of Juicy Couture, Alfred Sung, BCBGMAXAZRIA, Geoffrey Beene, Halston, Bob Mackie, Ed Hardy, John Varvatos, Kate Spade, Lucky Brand, True Religion and Rocawear; and the lifestyle fragrance brands Curve, Giorgio Beverly Hills, and PS Fine Cologne.

North Castle Partners is a leading private equity firm focused on investments in consumer product and service businesses that promote Health, Wellness, and Active Living. North Castle is a hands-on, value-added investor in high-growth, middle market companies in the (i) beauty & personal care, (ii) consumer health, (iii) fitness, recreation & sports, (iv) home & leisure and (v) nutrition sectors, among others. North Castle's current portfolio includes such well-known brands as Flatout Flatbreads, Ibex Outdoor Clothing, glominerals, Mineral Fusion, Performance Bicycle, World Health Club, Octane Fitness and Palladio Beauty Group. Prior portfolio company holdings include Naked Juice Company, Cascade Helmets, Enzymatic Therapy, Equinox Fitness, EAS, CRC Health Group, Doctor's Dermatologic Formula, and Avalon Natural Products. North Castle and its operating executives and advisors partner with management to bring a wide range of strategic and operational capabilities, as well as an extensive knowledge base and network to build world-class companies. North Castle is headquartered in Greenwich, CT. For more information, visit www.northcastlepartners.com.

In connection with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Elizabeth Arden, Inc. is hereby providing cautionary statements identifying important factors that could cause our actual results to differ materially from those projected in forward-looking statements (as defined in such act). Any statements that are not historical facts and that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, indicated through the use of words or phrases such as "will likely result," "are expected to," "will continue," "is anticipated," "should," "estimated," "intends," "plans," "believes" and "projects") may be forward-looking and may involve estimates and uncertainties which could cause actual results to differ materially from those expressed in the forward-looking statements. These statements include, but are not limited to, our guidance and expectations regarding net sales, earnings, gross margins, operating cash flow and returns on invested capital. In addition, any such statements are qualified in their entirety by reference to, and are accompanied by, the following key factors that have a direct bearing on our results of operations:

  *   factors affecting our relationships with our customers or our customers' businesses, including the absence of contracts with customers, our customers' financial condition, and changes in the retail, fragrance and cosmetic industries, such as the consolidation of retailers and the associated closing of retail doors as well as retailer inventory control practices, including, but not limited to, levels of inventory carried at point of sale and practices used to control inventory shrinkage; * risks of international operations, including foreign currency fluctuations, hedging activities, economic and political consequences of terrorist attacks, disruptions in travel, unfavorable changes in U.S. or international laws or regulations, diseases and pandemics, and political instability in certain regions of the world; * our reliance on license agreements with third parties for the rights to sell many of our prestige fragrance brands; * our reliance on third-party manufacturers for substantially all of our owned and licensed products and our absence of contracts with suppliers of distributed brands and components for manufacturing of owned and licensed brands; * delays in shipments, inventory shortages and higher costs of production due to the loss of or disruption in our distribution facilities or at key third party manufacturing or fulfillment facilities that manufacture or provide logistic services for our products; * our ability to respond in a timely manner to changing consumer preferences and purchasing patterns and other international and domestic conditions and events that impact retailer and/or consumer confidence and demand, such as domestic or global recessions or economic uncertainty; * our ability to protect our intellectual property rights; * the success, or changes in the timing or scope, of our new product launches, advertising and merchandising programs; * the quality, safety and efficacy of our products; * the impact of competitive products and pricing; * our ability to (i) implement our growth strategy and acquire or license additional brands or secure additional distribution arrangements, (ii) successfully and cost-effectively integrate acquired businesses or new brands, and (iii) finance our growth strategy and our working capital requirements; * our level of indebtedness, our ability to realize sufficient cash flows from operations to meet our debt service obligations and working capital requirements, and restrictive covenants in our revolving credit facility, term loan and the indenture for our 7 3/8% senior notes; * changes in product mix to less profitable products; * the retention and availability of key personnel; * changes in the legal, regulatory and political environment that impact, or will impact, our business, including changes to customs or trade regulations, laws or regulations relating to ingredients or other chemicals or raw materials contained in products or packaging, or accounting standards or critical accounting estimates; *

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the success of our global Elizabeth Arden brand repositioning efforts;

the impact of tax audits, including the ultimate outcome of the pending Internal Revenue Service examination of our U.S. federal tax returns for the fiscal years ended June 30, 2008 and June 30, 2009, changes in tax laws or tax rates, and our ability to utilize our deferred tax assets;

* our ability to effectively implement, manage and maintain our global information systems; * our reliance on third parties for certain outsourced business services, including information technology operations and employee benefit plan administration; * the potential for significant impairment charges relating to our trademarks, goodwill or other intangible assets that could result from a number of factors, including downward pressure on our stock price; and * other unanticipated risks and uncertainties.  

We caution that the factors described herein could cause actual results to differ materially from those expressed in any forward-looking statements we make and that investors should not place undue reliance on any such forward-looking statements. Further, any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New factors emerge from time to time, and it is not possible for us to predict all of such factors. Further, we cannot assess the impact of each such factor on our results of operations or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. This press release is qualified in its entirety by the cautionary statements and risk factor disclosure contained in our Securities and Exchange Commission filings, including our Annual Report on Form 10-K for the year ended June 30, 2011.