Avon Expects to Report Strong First Quarter Results

Apr 12, 2001, 01:00 ET from Avon Products, Inc.

    NEW YORK, April 12 /PRNewswire/ -- Avon Products, Inc. (NYSE:   AVP) said
 today it expects to report strong first quarter financial results, reflecting
 the continuing success of the company's strategic initiatives.  Avon is
 scheduled to report final results for the quarter on April 27.
     Avon said it estimates first quarter earnings will slightly exceed the
 $.33 per share consensus estimate among Wall Street analysts and guidance
 provided by the company in late February.  In the year-ago first quarter, Avon
 earned $.30 per share, before the cumulative effect of an accounting change.
     Sales in the quarter are expected to increase in the low- to mid-single
 digit range, on top of very strong 9% sales growth in the first quarter of
 last year, and in line with guidance previously provided by the company.
 Excluding the effects of foreign currency exchange, sales are expected to grow
 approximately 8% in the quarter, reflecting double-digit growth in local
 currency sales in international markets.
     Operating margin is expected to show further improvement over the
 1.5-point increase in the first quarter of 2000.  This would be the 13th
 consecutive quarter of operating margin improvement for Avon.
     In the U.S., Avon's largest market, the company expects to report sales
 growth in the low single digits, as previously anticipated, despite a
 generally weak retail environment.  Avon said U.S. sales growth accelerated
 throughout the quarter, driven by a particularly strong 3% increase in the
 number of Representative orders -- the highest order growth rate in 11 years.
 Sales of Cosmetics, Fragrance and Toiletries (CFT) products are expected to
 increase approximately 5%, outpacing overall U.S. sales growth in the quarter,
 reflecting Avon's strategy to focus on its beauty business.
     Avon also said it expects to show a very significant increase in operating
 cash flow in the quarter versus prior year, even excluding the $95 million
 one-time cash benefit from a recent income tax settlement.
     Commenting on the company's performance, CEO Andrea Jung said, "We're off
 to a very solid start in 2001 and we are pleased with the underlying strength
 of the business and the outlook for the full year.  Our strategies to
 accelerate beauty sales growth and contemporize the direct selling channel are
 working well," she said.
     "We are obviously aware of recent currency volatility in some markets, and
 we have built conservative assumptions for exchange rates into our plans for
 the year.  In addition, we have hedging contracts in place to further mitigate
 Avon's currency risks," Ms. Jung said.
     "Our new business strategies are on track, including the launch this Fall
 of our new retail brand in the U.S. -- beComing -- as well as our new line of
 Health and Well Being products to be sold through the direct selling channel
 in over 15 markets in the second half of this year," Ms. Jung said.
 
     Avon is the world's leading direct seller of beauty and related products,
 with $5.7 billion in annual revenues.  Avon markets to women in 139 countries
 through 3.4 million independent sales representatives.  Avon product lines
 include such recognizable brands as Anew, Skin-So-Soft, Avon Color, Far Away,
 Rare Gold, Perceive, and Avon Skin Care.  Avon also markets an extensive line
 of fashion jewelry, apparel, gifts and collectibles.  More information about
 Avon and its products can be found on the company's award-winning website
 http://www.avon.com
 
     Cautionary Statement under the Private Securities Litigation Reform Act of
 1995
     Statements in this release, which are not historical facts or information,
 are "forward-looking statements" within the meaning of the Private Securities
 Litigation Reform Act of 1995.  Such forward-looking statements are based on
 management's reasonable current assumptions and expectations.  Such
 forward-looking statements involve risks, uncertainties and other important
 factors which may cause the actual results of the Company to be materially
 different from any future results expressed or implied by such forward-looking
 statements, and there can be no assurance that actual results will not differ
 materially from management's expectations.  Such important factors include,
 among others, the following:  general economic and business conditions in the
 Company's markets; the Company's ability to implement its business strategy;
 the Company's ability to achieve anticipated cost savings and profitability
 targets; the impact of substantial currency exchange devaluations in the
 Company's principal foreign markets; and the effect of legal and regulatory
 proceedings and restrictions imposed on the Company or its operations by
 foreign governments.  Additional information identifying such important
 factors is contained in the Company's Form 10-K report for the year ended
 December 31, 2000, filed with the S.E.C.  The Company undertakes no obligation
 to update any such forward-looking statements.
 
 

SOURCE Avon Products, Inc.
    NEW YORK, April 12 /PRNewswire/ -- Avon Products, Inc. (NYSE:   AVP) said
 today it expects to report strong first quarter financial results, reflecting
 the continuing success of the company's strategic initiatives.  Avon is
 scheduled to report final results for the quarter on April 27.
     Avon said it estimates first quarter earnings will slightly exceed the
 $.33 per share consensus estimate among Wall Street analysts and guidance
 provided by the company in late February.  In the year-ago first quarter, Avon
 earned $.30 per share, before the cumulative effect of an accounting change.
     Sales in the quarter are expected to increase in the low- to mid-single
 digit range, on top of very strong 9% sales growth in the first quarter of
 last year, and in line with guidance previously provided by the company.
 Excluding the effects of foreign currency exchange, sales are expected to grow
 approximately 8% in the quarter, reflecting double-digit growth in local
 currency sales in international markets.
     Operating margin is expected to show further improvement over the
 1.5-point increase in the first quarter of 2000.  This would be the 13th
 consecutive quarter of operating margin improvement for Avon.
     In the U.S., Avon's largest market, the company expects to report sales
 growth in the low single digits, as previously anticipated, despite a
 generally weak retail environment.  Avon said U.S. sales growth accelerated
 throughout the quarter, driven by a particularly strong 3% increase in the
 number of Representative orders -- the highest order growth rate in 11 years.
 Sales of Cosmetics, Fragrance and Toiletries (CFT) products are expected to
 increase approximately 5%, outpacing overall U.S. sales growth in the quarter,
 reflecting Avon's strategy to focus on its beauty business.
     Avon also said it expects to show a very significant increase in operating
 cash flow in the quarter versus prior year, even excluding the $95 million
 one-time cash benefit from a recent income tax settlement.
     Commenting on the company's performance, CEO Andrea Jung said, "We're off
 to a very solid start in 2001 and we are pleased with the underlying strength
 of the business and the outlook for the full year.  Our strategies to
 accelerate beauty sales growth and contemporize the direct selling channel are
 working well," she said.
     "We are obviously aware of recent currency volatility in some markets, and
 we have built conservative assumptions for exchange rates into our plans for
 the year.  In addition, we have hedging contracts in place to further mitigate
 Avon's currency risks," Ms. Jung said.
     "Our new business strategies are on track, including the launch this Fall
 of our new retail brand in the U.S. -- beComing -- as well as our new line of
 Health and Well Being products to be sold through the direct selling channel
 in over 15 markets in the second half of this year," Ms. Jung said.
 
     Avon is the world's leading direct seller of beauty and related products,
 with $5.7 billion in annual revenues.  Avon markets to women in 139 countries
 through 3.4 million independent sales representatives.  Avon product lines
 include such recognizable brands as Anew, Skin-So-Soft, Avon Color, Far Away,
 Rare Gold, Perceive, and Avon Skin Care.  Avon also markets an extensive line
 of fashion jewelry, apparel, gifts and collectibles.  More information about
 Avon and its products can be found on the company's award-winning website
 http://www.avon.com
 
     Cautionary Statement under the Private Securities Litigation Reform Act of
 1995
     Statements in this release, which are not historical facts or information,
 are "forward-looking statements" within the meaning of the Private Securities
 Litigation Reform Act of 1995.  Such forward-looking statements are based on
 management's reasonable current assumptions and expectations.  Such
 forward-looking statements involve risks, uncertainties and other important
 factors which may cause the actual results of the Company to be materially
 different from any future results expressed or implied by such forward-looking
 statements, and there can be no assurance that actual results will not differ
 materially from management's expectations.  Such important factors include,
 among others, the following:  general economic and business conditions in the
 Company's markets; the Company's ability to implement its business strategy;
 the Company's ability to achieve anticipated cost savings and profitability
 targets; the impact of substantial currency exchange devaluations in the
 Company's principal foreign markets; and the effect of legal and regulatory
 proceedings and restrictions imposed on the Company or its operations by
 foreign governments.  Additional information identifying such important
 factors is contained in the Company's Form 10-K report for the year ended
 December 31, 2000, filed with the S.E.C.  The Company undertakes no obligation
 to update any such forward-looking statements.
 
 SOURCE  Avon Products, Inc.