Avon posts 14 percent rise after strong international sales

Source: Exec

Date :29/04/2008 04:39:05

Avon, the global beauty company, today reported that first quarter 2008 total revenue grew by 14 percent to $2.5 billion.

Net income in the same period was $185 million compared with $150 million in the year ago period. Earnings per share were $0.43 versus $0.34 per share in the first quarter 2007, or 26 percent higher.

Products

Sales of beauty products rose 17 percent, and included an increase in all categories. Sales increases were posted in Latin America and Eastern Europe, as well as China, reflecting the company’s continued success in operating in this priority growth market.

However, revenue in the North American region decreased, impacted by the weak economy and, to a lesser degree, service-related problems.

Andrea Jung, Chairman and CEO, said: “With this solid start to the year, and despite the challenges in North America, we remain confident that we can deliver on our 2008 objectives to achieve a full-year operating margin that approaches 2005’s level of approximately 14 percent and revenue growth in line with or long-term target of mid-single-digit growth.”

Avon increased advertising expense to support the launch of several new products, including Anew Ultimate Age Repair Day Cream and Contouring Eye System, and Supershock Mascara, as well as representative recruitment advertising.

The company is currently the world’s largest direct seller and markets to women in more than 100 countries through 5.4 million independent Avon Sales Representatives.

April 29, 2008