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AVON SALES INCREASED 2 PERCENT FOR QUARTER, INCOME LEVEL WITH LAST YEAR; FOURTH QUARTER AND FULL YEAR RESULTS EXPECTED TO EXCEED 1992

 NEW YORK, Oct. 18 /PRNewswire/ -- For the third quarter, Avon Products, Inc. (NYSE: AVP), reported a 2 percent increase in sales and income level with last year, the company announced today.
 Sales rose to $957.1 million from $938.8 million reported the prior year. Net income was $54.0 million, compared with $53.9 million for the third quarter of 1992. Income per share was 75 cents, the same as the prior year.
 "Despite softness in some of our largest markets resulting primarily from sluggish economic conditions, the quarter came in a little better than we had anticipated," said James E. Preston, chairman and chief executive officer. "Our business around the world is basically healthy."
 Preston continued: "We are addressing the major problem area, the United States, which has been coping with an uncertain economy and has been in a transitional phase as new growth initiatives are introduced. Despite the weakness in the U.S., we are confident that both fourth quarter and full year consolidated sales and income from continuing operations will be up."
 Third quarter results include an $8 million pretax gain, or 9 cents per share, on the sale of a non-operating asset and reflect a lower annual effective tax rate.
 At the end of the quarter, total debt was $351.2 million, down from $429.8 million as of Sept. 30, 1992.
 For the quarter, Avon International sales and pretax profits were up 5 percent from last year. The company continued to experience strong sales and profit growth in the Americas, particularly in Argentina and Mexico. In Europe, sales were down from last year, mainly as a result of the strength of the dollar against European currencies. Although Europe's pretax profit increased, results in Germany continued to be impacted by recession. In the Pacific Region, sales were up due to the impact of a weaker dollar against the Japanese Yen and operational increases in the Pacific Rim. Pretax profit in the Pacific Rim was lower because of additional initiatives to accelerate growth in the area.
 Avon U.S. sales were down 4 percent. Pretax profit decreased 36 percent from the prior year. Half of the profit decline is attributable to continued long-term investment in advertising and introduction of improved methods of consumer access designed to stimulate growth. The other half came from the sales decline.
 Consolidated direct selling units were down 2 percent compared with the prior year. International units were up 4 percent. In the U.S., units were down 12 percent, reflecting the sales decline and a shift in the sales mix.
 For the first nine months of 1993, sales were $2.7 billion, up 4 percent from $2.6 billion in the prior year. Income from continuing operations for the nine-month period was $144.2 million, or $2.00 per share, up 6 percent and 5 percent, respectively, over the prior year. This increase excludes the impact of the first quarter 1992 after-tax restructuring charge of $64.4 million, or 90 cents per share.
 A first-quarter net non-cash charge of $107.5 million, or $1.49 per share, for accounting changes associated with post retirement benefits (FAS 106) and income taxes (FAS 109) and a $10 million, or 14 cents per share, charge to discontinued operations resulted in net income of $26.7 million, or 37 cents per share for the nine months ended Sept. 30, 1993.
 Avon is the world's leading direct seller and marketer of beauty and related products with $3.8 billion in annual revenues. Avon markets its products to women in more than 100 countries through 1.7 million independent representatives. Avon product lines include such recognizable brands as Anew, Skin-So-Soft, Moisture Therapy, Color Release Long-Wearing Lipstick and Imari fragrance. Avon is also the world's largest manufacturer of fashion jewelry, and markets an extensive line of gifts and collectibles. The company employs approximately 30,000 people worldwide.
 AVON PRODUCTS, INC.
 Consolidated Statement of Operations
 (In millions, except per share data)
 Three months Percent Nine Months Percent
 ended Sept 30 Change Ended Sept 30 Change
 1993 1992 1993 1992
 Net Sales $957.1 $938.8 2 $2,748.3 $2,635.3 4
 Costs, expenses
 and other:
 Cost of sales 368.5 371.2 1,050.5 1,021.1
 Mktg., distrib.,
 and admin.
 expenses 493.0 469.5 1,422.7 1,345.3
 Provision for
 restructuring
 costs -- -- -- 96.0
 Interest expense 11.6 10.2 33.2 33.9
 Interest income (3.9) (8.9) (19.1) (24.6)
 Other expense,
 net 2.7 6.7 22.8 27.8
 Total costs,
 expenses
 and other 871.9 848.7 3 2,510.1 2,499.5 0
 Income from
 continuing
 ops. before
 taxes,
 minority int.,
 and cumulative
 effect of
 accounting
 changes 85.2 90.1 (5) 238.2 135.8 75
 Income taxes 31.0 35.9 92.2 61.6
 Income from
 continuing
 ops. before
 minority int.,
 and cumulative
 effect of
 accounting
 changes 54.2 54.2 0 146.0 74.2 97
 Minority int. (.2) (.3) (1.8) (2.5)
 Income from
 continuing
 ops. before
 cumulative
 effect of
 accounting
 changes 54.0 53.9 0 144.2 71.7 -
 Discontinued
 ops., net -- -- (10.0) --
 Cumulative effect
 of changes in
 accounting for
 postretirement
 benefits and
 income taxes -- -- (107.5) --
 Net income $ 54.0 $ 53.9 0 $ 26.7 $ 71.7 (63)
 Income (loss)
 per share of
 common stock:
 Income from
 continuing ops.
 before cumulative
 effect of
 accounting
 changes $ .75 $ .75 0 $ 2.00 $ 1.00 100
 Discontinued
 ops. -- -- (.14) --
 Cumulative
 effect of
 accounting
 changes -- -- (1.49) --
 Net Income $ .75 $ .75 0 $ .37 $ 1.00 (63)
 Average shares
 outstanding 72.07 71.79 72.05 71.81
 -0- 10/18/93
 /CONTACT: Jim Daniels of Avon, 212-546-6058/
 (AVP)


CO: Avon Products, Inc. ST: New York IN: HOU SU: ERN

GK -- NY015 -- 3164 10/18/93 08:07 EDT
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Publication:PR Newswire
Date:Oct 18, 1993
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