Interviews
News Flash
Avon reports third-quarter total revenue up 13%
31 Oct '08
5 min read
At quarter end, Avon's total debt had increased $313 million from the year-end level, and cash had increased $4 million. Net cash provided by operating activities was $303 million through nine months of 2008, compared with $63 million in the same period of 2007. This favorable comparison was due in large part to higher net income and improved management of inventory and accounts receivable levels. Looking forward, the company said that it continues to expect full-year 2008 cash flow from operating activities to be substantially higher than that of full-year 2007.
Third-Quarter Regional Highlights
Latin America's third-quarter revenue rose 25% year over year (13% in local currency). Avon said that revenue increased over 30% in Brazil, nearly 40% in Venezuela, and nearly 10% in Mexico. The region's Active Representatives increased 4%, and units sold were flat with the prior year. Operating profit grew 44% versus the 2007 quarter, primarily due to higher revenue as well as favorable foreign exchange rates. Latin America's third-quarter operating margin was 19.4%.
In the North America region, third-quarter revenue was 3% lower (4% lower in local currency) than the prior-year's level. Active Representatives rose 1%. Units sold decreased 5% from prior-year levels. Sales of Beauty products were flat year over year, while sales of Beyond Beauty products declined 23%, reflecting, in large part, the general retail environment of the region. Operating profit was 29% lower than that of the 2007 quarter, primarily due to lower revenue coupled with higher input costs. The region's operating margin was 5.1%.
In Central & Eastern Europe, third-quarter revenue rose 17% (5% in local currency). The region's growth was driven by Russia, where revenue increased 12%, and also Ukraine, where revenue expanded 50%. The region's Active Representatives grew 5%. Units sold increased 2%. Operating profit was 13% lower than the prior year, as the region's revenue increase was offset by higher RVP and advertising expense and the unfavorable impact of foreign exchange on product costs. The region's third-quarter operating margin was 15.5%.
The Western Europe, Middle East & Africa region achieved revenue growth of 8% (6% in local currency), due in large part to continued growth in Turkey, where revenue increased over 20%, and Italy, where revenue rose nearly 30%. U.K. revenue grew 1%. Year over year, the region's Active Representatives rose 6%. Units sold decreased 5%. Operating profit was 73% higher versus the 2007 quarter due to higher revenue. The region's third-quarter operating margin was 5.8%.
Asia-Pacific revenue increased 6% (2% in local currency), with the Philippines contributing revenue growth of 20%. The region's Active Representatives rose 1% year over year, while units sold increased 3% compared with the prior year. Operating profit was up 96% year over year, primarily as a result of lower overheadexpenses. The region's operating margin was 11.0%.
Revenue in China grew 25% (13% in local currency), Active Representatives were up 98%. Units sold were 5% lower. Reflecting continued strategic investment, the region reported an operating loss of $7 million versus a loss of $5 million in the 2007 period. The region's third-quarter operating margin was (9.6)%.
Third-Quarter Regional Highlights
Latin America's third-quarter revenue rose 25% year over year (13% in local currency). Avon said that revenue increased over 30% in Brazil, nearly 40% in Venezuela, and nearly 10% in Mexico. The region's Active Representatives increased 4%, and units sold were flat with the prior year. Operating profit grew 44% versus the 2007 quarter, primarily due to higher revenue as well as favorable foreign exchange rates. Latin America's third-quarter operating margin was 19.4%.
In the North America region, third-quarter revenue was 3% lower (4% lower in local currency) than the prior-year's level. Active Representatives rose 1%. Units sold decreased 5% from prior-year levels. Sales of Beauty products were flat year over year, while sales of Beyond Beauty products declined 23%, reflecting, in large part, the general retail environment of the region. Operating profit was 29% lower than that of the 2007 quarter, primarily due to lower revenue coupled with higher input costs. The region's operating margin was 5.1%.
In Central & Eastern Europe, third-quarter revenue rose 17% (5% in local currency). The region's growth was driven by Russia, where revenue increased 12%, and also Ukraine, where revenue expanded 50%. The region's Active Representatives grew 5%. Units sold increased 2%. Operating profit was 13% lower than the prior year, as the region's revenue increase was offset by higher RVP and advertising expense and the unfavorable impact of foreign exchange on product costs. The region's third-quarter operating margin was 15.5%.
The Western Europe, Middle East & Africa region achieved revenue growth of 8% (6% in local currency), due in large part to continued growth in Turkey, where revenue increased over 20%, and Italy, where revenue rose nearly 30%. U.K. revenue grew 1%. Year over year, the region's Active Representatives rose 6%. Units sold decreased 5%. Operating profit was 73% higher versus the 2007 quarter due to higher revenue. The region's third-quarter operating margin was 5.8%.
Asia-Pacific revenue increased 6% (2% in local currency), with the Philippines contributing revenue growth of 20%. The region's Active Representatives rose 1% year over year, while units sold increased 3% compared with the prior year. Operating profit was up 96% year over year, primarily as a result of lower overheadexpenses. The region's operating margin was 11.0%.
Revenue in China grew 25% (13% in local currency), Active Representatives were up 98%. Units sold were 5% lower. Reflecting continued strategic investment, the region reported an operating loss of $7 million versus a loss of $5 million in the 2007 period. The region's third-quarter operating margin was (9.6)%.
Avon Products Inc
Popular News
Leave your Comments
Editor’s Pick
Esteemed Clients
-Ltd..jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Thermore (Far East) Ltd.")
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Telangana State Industrial Infrastructure Corporation Limited (TSllC Ltd)")
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Taiwan Textile Federation (TTF)")
