Avon Reports “Unsatisfactory” Q1 2018 Results
Avon Products, Inc., a London, U.K.-based global leader in the beauty sector, has announced its results for the quarter ended March 31, 2018. Revenue rose 5 percent to $1.4 billion; however, net loss was $21 million and the number of Avon’s active representatives fell 4 percent, the steepest decline in three years.
“Avon’s first-quarter results were unsatisfactory and do not represent the underlying potential of the business,” said Avon CEO Jan Zijderveld. “During my first 90 days, I have been deeply engaged in a comprehensive review of the company’s operations, including on-the-ground visits to many of our top markets where I have met with many of our direct selling Representatives. While we are focused on the formulation of Avon’s longer-term plans, we are already implementing near-term fixes that support the success and satisfaction of our Representatives—starting with actions to improve service delivery. Our long-term mission is clear, to return Avon to a competitive market position, and we are moving with deliberate urgency to design our turnaround plan.”
For the Europe, Middle East and Africa segment, revenue was up 12 percent, or 2 percent in constant dollars, both including a benefit of approximately 5 percent due to the impact of adopting the new revenue recognition standard. Revenue and constant-dollar revenue were negatively impacted by a decrease in Active Representatives and lower average order.
In South America, revenue was relatively unchanged, or up 4 percent in constant dollars, both including a benefit of approximately 9 percent due to the impact of adopting the new revenue recognition standard. Revenue and constant-dollar revenue were negatively impacted by a decrease in Active Representatives. Revenue and constant-dollar revenue were primarily impacted by a decline in Brazil, partially offset by growth in Argentina, driven by inflationary pricing.
In North Latin America, revenue was up 1 percent, or down 3 percent in constant dollars, both including a benefit of approximately 5 percent due to the impact of adopting the new revenue recognition standard. Revenue and constant-dollar revenue were negatively impacted by a decrease in Active Representatives and, to a lesser extent, by lower average order.
In Asia Pacific, revenue was down 2 percent, or 3 percent in constant dollars, both including a decline of 1 percent due to the impact of adopting the new revenue recognition standard. Revenue and constant-dollar revenue were negatively impacted by a decrease in Active Representatives, most significantly in Malaysia, as well as lower average order.
You can read the full Avon Q1 2018 report, here.
