NEW YORK, Feb. 11, 2016 /PRNewswire/ -- Avon Products,
Inc. (NYSE: AVP) today reported fourth-quarter and full-year 2015
results. "Our operating performance for the fourth quarter and
fiscal year was in-line with our most recent outlook. Looking
back at 2015, our key local markets drove steady improvement in
overall performance. Importantly, we improved year-on-year Active
Representative trends – with full-year growth of 1%," said
Sheri McCoy, Chief Executive Officer
of Avon Products, Inc. "We are on track to close our partnership
with Cerberus and fully engaged in executing our transformation
plan."
Fourth-Quarter 2015 Income Statement Review (compared with
fourth-quarter 2014)
- Total revenue for Avon Products, Inc. declined 20% to
$1.6 billion, but increased 3% in
constant dollars excluding the divestiture of Liz Earle. In
addition, the year-over-year comparison is impacted by certain tax
items in Brazil discussed further
in the Latin America section of
the regional highlights. Excluding the impacts of Liz Earle and
certain Brazil tax items,
constant-dollar revenue would have grown approximately
6%2. The Company's Latin
America markets experiencing high inflation (Venezuela and Argentina) contributed approximately 3 points
to this constant-dollar revenue growth.
- Active Representatives were up 2% year over year, as increases
in Europe, Middle East & Africa were partially offset by declines in
the Latin America markets
experiencing high inflation. Average order decreased 1%, negatively
impacted by approximately 3 points due to the Brazil value added tax ("VAT") credits in 2014
that did not recur in 2015 and the Brazil Industrial Production Tax
("IPI") in 2015, as well as by approximately 1 point from the
divestiture of Liz Earle. These negative impacts on average order
were partially offset by the benefit from price increases, most
significantly in Russia and
Brazil, as well as in the
Latin America markets experiencing
high inflation.
- Total units decreased 2%, driven by declines in Latin America and Asia Pacific. Price/mix was up 3% during the
quarter, driven by price increases.
- Beauty sales declined 21%, but increased 2% in constant
dollars, negatively impacted by the IPI tax in 2015 discussed below
as well as the divestiture of Liz Earle. Fashion & Home sales
declined 14%, but increased 5% in constant dollars.
- Gross margin was 58.7%, down 280 basis points. Adjusted
gross margin was 58.8%, down 270 basis points. These year-over-year
comparisons were negatively impacted by approximately 70 basis
points due to the combined impact of the VAT credits in 2014 and
the IPI tax in 2015 discussed below. Excluding the impacts of these
items, Adjusted gross margin would have declined 200 basis
points2 primarily driven by an approximate 350 basis
points of unfavorable impact of foreign exchange, partially offset
by the favorable net impact of price/mix and lower supply chain
costs.
- Operating margin was 3.9% in the quarter, down 480 basis
points. Adjusted operating margin was 6.0%, down 420 basis points.
These year-over-year comparisons were negatively impacted by
approximately 210 basis points due to the combined impact of the
VAT credits in 2014 and the IPI tax in 2015 discussed below.
Excluding the impacts of these items, Adjusted operating margin
would have decreased 210 basis points2, which was
primarily driven by an estimated 530 basis points of unfavorable
impact of foreign exchange. The foreign exchange impact was
partially offset by the favorable net impact of price/mix as well
as continued benefits from cost savings initiatives.
- The effective tax rate from continuing operations was
negatively impacted primarily by costs to implement restructuring
associated with U.S.-based costs for which there was no net tax
benefit recognized as we record valuation allowances on the tax
benefits of our U.S.-based losses. This negative impact to our
effective tax rate was partially offset by the recognition of a
benefit associated with the implementation of foreign tax planning
strategies. The Adjusted effective tax rate in 2015 was negatively
impacted by the country mix of earnings and the inability to
recognize additional deferred tax assets in various jurisdictions
related to our current-year operating results. The year-over-year
difference in the Adjusted effective tax rate caused an estimated
$0.06 per share negative impact on
Adjusted loss per share. The Adjusted effective tax rate is
expected to be volatile on a quarterly basis due to the country mix
of quarterly earnings.
- Loss from continuing operations, net of tax was
$15 million, or a loss of
$0.04 per diluted share, compared
with a loss of $305 million, or a
loss of $0.70 per diluted share, for
the fourth quarter of 2014. Adjusted income from continuing
operations, net of tax was $1
million, or $0.00 per diluted
share, compared with Adjusted income from continuing operations,
net of tax of $94 million, or
$0.21 per diluted share, for the
fourth quarter of 2014.
- Loss from discontinued operations, net of tax was
$317 million, or a loss of
$0.72 per diluted share, compared
with a loss of $24 million, or
$0.06 per diluted share, for the
fourth quarter of 2014. During the fourth quarter of 2015, we
recorded a charge of $340 million
($340 million after tax) associated
with the estimated loss on the sale of the North America business that is expected to be
completed in 2016. In addition, the North
America operations achieved higher operating income in 2015
as compared to 2014 despite lower revenues as a result of
significant cost savings.
- As a result of the above, Net loss attributable to
Avon was $333 million, or a loss of $0.76 per diluted share, as compared to a loss of
$331 million, or a loss of
$0.75 per diluted share for the
fourth quarter of the prior year.
- Foreign currency has impacted the Company's financial
results of continuing operations as shown in the table below:
Estimated Impact
of Foreign Currency on Continuing Operations
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Fourth-Quarter
2015
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Full-Year
2015
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Estimated
impact
($ in millions)
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Estimated
impact
on diluted EPS
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Estimated
impact
($ in millions)
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Estimated
impact
on diluted EPS
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Total
revenue
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(21) pts
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(21) pts
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Adjusted operating
profit - transaction
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$
(75)
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$
(0.11)
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$
(210)
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$
(0.31)
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Adjusted operating
profit - translation
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(60)
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(0.09)
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(265)
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(0.38)
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Total Adjusted
operating profit
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$
(135)
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$
(0.20)
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$
(475)
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$
(0.69)
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Adjusted operating
margin
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(530)
bps
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(480)
bps
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Revaluation of
working capital
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$
25
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$
0.04
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$
10
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$
0.01
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Adjusted diluted EPS
from continuing operations
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$
(0.16)
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$
(0.68)
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Adjustments to Fourth-Quarter 2015 GAAP Results to Arrive at
Adjusted Results
During the fourth quarter of 2015, the following items had an
aggregate impact of $0.04 per diluted
share on the financial results:
- The Company recorded costs to implement restructuring within
operating profit of approximately $21
million before tax, primarily related to the previously
announced IT infrastructure outsourcing initiative.
- Effective February 12, 2015, the
Company began utilizing the SIMADI rate to remeasure its Venezuelan
operations. The change to the SIMADI rate resulted in an
approximate $2 million negative
impact on operating profit.
- As a result of the lump-sum payments made in the fourth quarter
of 2015 to former employees who were vested and participated in the
U.S. pension plan, the Company recorded a settlement charge within
operating profit of approximately $1
million before tax.
- Our analysis of the Egypt
business indicated an impairment as the carrying value of the
business exceeded the estimated fair value, driven by a reduction
of the long-term revenue and earnings projections due to currency
restrictions in the country. As a result, the Company recorded a
non-cash impairment charge of approximately $7 million before tax.
- The Company recorded approximately $3
million of transaction-related costs associated with the
planned separation of North
America that were included in Continuing Operations.
- The Company recorded an income tax benefit of approximately
$19 million, which was recognized as
a result of the implementation of foreign tax planning
strategies.
Fourth-Quarter 2015 Regional Highlights (compared with
fourth-quarter 2014)
THREE MONTHS ENDED
DECEMBER 31, 2015
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REGIONAL
RESULTS
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($ in
millions)
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Revenue
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Active
Reps
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Average
Order C$
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Units
Sold
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Price/Mix
C$
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Revenue &
Drivers
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US$
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C$
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% var. vs
4Q14
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% var. vs
4Q14
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% var. vs
4Q14
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% var. vs
4Q14
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% var. vs
4Q14
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% var. vs
4Q14
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Latin
America
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$
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779.2
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(26)%
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-%
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(1)%
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1%
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(6)%
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6%
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Europe, Middle East
& Africa
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669.5
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(13)
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6
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8
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(2)
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7
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(1)
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Asia
Pacific
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158.6
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(16)
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(8)
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-
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(8)
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(7)
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(1)
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Total from
operations
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1,607.3
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(20)
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1
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2
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(1)
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(2)
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3
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Global and
other
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-
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-
|
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-
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-
|
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-
|
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-
|
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-
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Total
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$
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1,607.3
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(20)%
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1%
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2%
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(1)%
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(2)%
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3%
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2015
GAAP
|
|
Adjusted Operating
Profit
(Loss) in US$
|
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Adjusted Operating
Margin
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Operating
Profit/Margin
|
Operating
Profit (Loss) US$
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Operating
Margin US$
|
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2015
|
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2014
|
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2015
|
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2014
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Change
in US$
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Change
in C$
|
Latin
America
|
$
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47.5
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6.1%
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$
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49.0
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$
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93.0
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6.3%
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8.8%
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(250) bps
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(80) bps
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Europe, Middle East
& Africa
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77.5
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11.6
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83.7
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107.2
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12.5
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13.9
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(140)
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(70)
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Asia
Pacific
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8.5
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5.4
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8.9
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11.7
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5.6
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6.2
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(60)
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10
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Total from
operations
|
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133.5
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8.3
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|
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141.6
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211.9
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8.8
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10.5
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(170)
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(450)
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Global and other
*
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(70.6)
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-
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(44.8)
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(6.6)
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-
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-
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-
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-
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Total
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$
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62.9
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3.9%
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$
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96.8
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$
|
205.3
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6.0%
|
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10.2%
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(420) bps
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(260) bps
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*As a
result of its classification within discontinued operations, Global
and other amounts have been adjusted as compared to amounts
previously reported as Global and other. This is primarily
due to the inclusion of amounts of Global expenses that were
previously allocated to North America, as these represent costs
associated with functions of the Company's continuing
operations.
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Fourth-Quarter 2015 Regional Highlights
- Latin America revenue
was down 26%, but relatively unchanged in constant dollars.
Constant-dollar revenue was negatively impacted by certain tax
items in Brazil. Specifically, in
2015, the government levied a new IPI tax on cosmetics while in
2014, the Company recognized VAT credits, which did not recur in
2015. Excluding the combined impacts of these items,
constant-dollar revenue would have grown approximately
6%2. Venezuela and
Argentina contributed
approximately 5 points to this constant-dollar revenue growth.
Active Representatives declined, primarily due to declines in
Venezuela and Argentina.
- Brazil revenue was down
44%, or down 14% in constant dollars. Constant-dollar revenue
growth was negatively impacted by approximately 12 points due to
the combined impact of the VAT credits in 2014 and the IPI tax in
2015. Excluding the impacts of these items, constant-dollar revenue
would have declined approximately 2%2, driven primarily
by lower average order, which was partially offset by an increase
in Active Representatives. This market continues to be impacted by
a difficult macroeconomic environment and high levels of
competition.
- Mexico revenue was down
13%, but up 6% in constant dollars, primarily driven by higher
average order, partially offset by a modest decline in Active
Representatives.
- Europe, Middle East & Africa revenue was down 13%, but up 6% in
constant dollars. Constant-dollar revenue was negatively impacted
by approximately 4 points due to the divestiture of Liz Earle
discussed above. Excluding the impact of this item, constant-dollar
revenue would have grown approximately 10%2, and was
driven by an increase in Active Representatives, led by strength in
a number of markets, most significantly Russia.
- Russia revenue was down
8%, but up 29% in constant dollars, primarily driven by an increase
in Active Representatives from sustained momentum in recruiting and
retention, along with higher average order benefiting from
favorable pricing.
- U.K. revenue was down 12%, or down 7% in constant
dollars, primarily driven by a decline in Active
Representatives.
- Asia Pacific revenue
was down 16%, or down 8% in constant dollars. The Philippines revenue was relatively
unchanged, but up 5% in constant dollars, which was more than
offset by declines in other Asia
Pacific markets, led by China.
Full-Year 2015 Income Statement Review (compared with
full-year 2014)
- Total revenue for Avon Products, Inc. declined 19% to
$6.2 billion, but increased 3% in
constant dollars excluding the divestiture of Liz Earle. In
addition, the year-over-year comparison is impacted by certain tax
items in Brazil. Excluding the
impacts of these items, constant-dollar revenue would have grown
approximately 5%2. The Company's Latin America markets experiencing high
inflation (Venezuela and
Argentina) contributed
approximately 3 points to this constant-dollar revenue growth.
- Active Representatives and average order were both up 1% year
over year.
- Price/mix was up 4%, while total units decreased 2%.
- Beauty sales declined 20%, but increased 3% in constant
dollars. Fashion & Home sales declined 15%, but increased 5% in
constant dollars.
- Gross margin was 60.3%, down 40 basis points. Adjusted
gross margin was 60.8%, down 150 basis points. These year-over-year
comparisons were negatively impacted by approximately 60 basis
points due to the combined impact of the VAT credits in 2014 and
the IPI tax in 2015. Excluding the impacts of these items, Adjusted
gross margin would have decreased 90 basis points2
primarily driven by an approximate 270 basis points of unfavorable
impact of foreign exchange, partially offset by the favorable net
impact of price/mix and lower supply chain costs.
- Operating margin was 2.7% for the year, down 300 basis
points. Adjusted operating margin was 5.7%, down 360 basis points.
These year-over-year comparisons were negatively impacted by
approximately 180 basis points due to the combined impact of the
VAT credits in 2014 and the IPI tax in 2015. Excluding the impacts
of these items, Adjusted operating margin would have decreased
180 basis points2, which was primarily driven by an
estimated 480 basis points of unfavorable impact of foreign
exchange. The foreign exchange impact was partially offset by the
favorable net impact of price/mix, the continued benefits from cost
savings initiatives and the favorable impact of constant-dollar
revenue growth with respect to our fixed expenses.
- The effective tax rate was negatively impacted by
additional valuation allowances for deferred tax assets of
approximately $670 million, which
caused income tax expense to be significantly in excess of income
from continuing operations, before taxes. The effective tax rate
was also impacted by the Venezuela
special items, costs to implement restructuring and other
nonrecurring items. The Adjusted effective tax rate in 2015 was
negatively impacted by the country mix of earnings and the
inability to recognize additional deferred tax assets in various
jurisdictions related to our current-year operating results. The
year-over-year difference in the Adjusted effective tax rate caused
an estimated $0.22 per share negative
impact on Adjusted loss per share. The Adjusted effective tax rate
is expected to be volatile on a quarterly basis due to the country
mix of quarterly earnings.
- Loss from continuing operations, net of tax was
$797 million, or a loss of
$1.81 per diluted share, compared
with a loss of $344 million, or a
loss of $0.79 per diluted share, for
the full year of 2014. Adjusted income from continuing operations,
net of tax was $7 million, or
$0.01 per diluted share, compared
with Adjusted income of $328 million,
or $0.74 per diluted share, for the
full year of 2014.
- Loss from discontinued operations, net of tax was
$349 million, or a loss of
$0.79 per diluted share, compared
with a loss of $40 million, or
$0.09 per diluted share, for 2014.
During 2015, we recorded a charge of $340
million ($340 million after
tax) associated with the estimated loss on the sale of the
North America business that is
expected to be completed in 2016. In addition, the North America operations achieved higher
operating income in 2015 as compared with 2014 despite lower
revenues as a result of significant cost savings, as well as lower
costs to implement restructuring initiatives.
-
As a result of the above, Net loss attributable to
Avon for the full year of 2015
was $1.1 billion, or a loss of
$2.60 per diluted share, as compared
to a loss of $389 million, or a loss
of $0.88 per diluted share in the
prior year.
Full-Year 2015 Cash Flow Review
- Net cash provided by operating activities of continuing
operations was $91 million for
the twelve months ended December 31,
2015, compared with $289
million for the same period in 2014. Operating cash flow
during 2015 was unfavorably impacted by lower cash-related earnings
(including the unfavorable impact of foreign currency translation).
These items were partially offset by lower operating tax payments
(such as VAT) and lower payments for employee incentive
compensation.
- For the twelve months ended December 31,
2015, there was $143 million
of net cash provided by investing activities of continuing
operations, a $243 million
improvement over the prior year primarily due to the Company's sale
of the Liz Earle business.
- Net cash used by financing activities of continuing
operations was $431 million for
the twelve months ended December 31,
2015, or $222 million higher
than the prior year primarily due to the prepayment of $250 million principal amount of notes that were
due in 2016.
Adjustments to Full-Year 2015 GAAP Results to Arrive at
Adjusted Results
During the full year 2015, the following items had an aggregate
impact of $1.82 per diluted share on
the financial results:
- The Company recorded costs to implement restructuring within
operating profit of approximately $49
million before tax, primarily related to cost savings
initiatives.
- Effective February 12, 2015, the
Company began utilizing the SIMADI rate to remeasure its Venezuelan
operations. The change to the SIMADI rate resulted in an
approximate $120 million negative
impact on operating profit, a benefit of approximately $4 million in other expense, net, and an
approximate $1 million negative
impact in income taxes. The negative impact on operating profit
includes an impairment charge of approximately $90 million to reflect the write-down of the
Venezuela long-lived assets.
- As a result of the lump-sum payments made in 2015 to former
employees who were vested and participated in the U.S. pension
plan, the Company recorded settlement charges within operating
profit of approximately $7 million
before tax.
- Our analysis of the Egypt
business indicated an impairment as the carrying value of the
business exceeded the estimated fair value, driven by a reduction
of the long-term revenue and earnings projections due to currency
restrictions in the country. As a result, the Company recorded a
non-cash impairment charge of approximately $7 million before tax.
- The Company also recorded various other items in 2015
associated with the sale of Liz Earle, the planned separation of
North America and debt-related
charges:
- In July 2015, the Company sold
Liz Earle. As a result, the Company recorded a gain on sale of
approximately $45 million before tax,
and approximately $52 million after
tax.
- The Company recorded nonrecurring costs of approximately
$3 million of transaction-related
costs associated with the planned separation of North America that were included in Continuing
Operations.
- The Company incurred a loss on extinguishment of debt of
approximately $6 million before tax
related to the prepayment of its notes that were due in 2016, and
recorded costs of approximately $3
million in other expense, net related to the write-off of
issuance costs related to the Company's previous $1 billion revolving credit facility.
- The Company recorded non-cash income tax charges of
approximately $670 million as a
result of establishing a valuation allowance for the full amount of
the Company's U.S. deferred tax assets, due to the impact of the
continued strengthening of the U.S. dollar against currencies of
some of its key markets and the associated effect on its tax
planning strategies. In addition, the Company also recorded a
non-cash income tax charge of approximately $15 million associated with valuation allowances
for deferred tax assets outside of the U.S. The Company also
recorded an income tax benefit of approximately $19 million, which was recognized as a result of
the implementation of foreign tax planning strategies.
Transformation Plan
In January 2016, the Company
announced a Transformation Plan, which includes cost reductions in
an effort to continue to improve its cost structure and to enable
the Company to reinvest in growth. As a result of this plan, the
Company expects pre-tax annualized cost savings of approximately
$350 million after three years, with
an estimated $200 million from supply
chain reductions and an estimated $150
million from other cost reductions. These pre-tax cost
savings are expected to be achieved through restructuring actions
as well as other cost-savings strategies that will not result in
restructuring charges. The Company plans to reinvest a portion of
these cost savings in growth initiatives, including media, social
selling and information technology systems that will help the
Company modernize its business. The Transformation Plan was
initiated in order to enable the Company to achieve its long-term
goals of low double-digit operating margin and mid single-digit
constant-dollar revenue growth.
Annual Meeting of Shareholders
The Company also announced today that it plans to hold its 2016
Annual Meeting of Shareholders on May
26, 2016. Further details, including time, location,
admission requirements and the business to be conducted will be
more fully described in the Notice of Annual Meeting of
Shareholders and Proxy Statement.
Conference call
Avon will conduct a conference
call at 9:00 A.M. today to discuss
the full-year and quarterly results. The dial-in number for the
call is (800) 843-2086 in the U.S. or (706) 643-1815 from non-U.S.
locations (conference ID number: 33073299). The call will be
webcast live at www.avoninvestor.com and can be accessed or
downloaded from that site for a period of one year.
About Avon Products, Inc.
Avon is the Company that for
130 years has proudly stood for beauty, innovation, optimism and,
above all, women. Avon products
include well-recognized and beloved brands such as ANEW, Avon
Color, Avon Care, Skin-So-Soft, and Advance Techniques. Sold
through nearly 6 million active independent Avon Sales
Representatives, Avon products
delight consumers in approximately 70 countries worldwide. Learn
more about Avon and its products
at www.avoncompany.com.
Footnotes
1 "Adjusted" items refer to financial measures that
are derived from measures calculated in accordance with generally
accepted accounting principles in the
United States ("GAAP"), but which have been adjusted to
exclude certain items. Other Adjusted financial measures that we
refer to include Constant dollar (C$) items. All of these
adjusted items are Non-GAAP financial measures as described below
under "Non-GAAP Financial Measures." These Non-GAAP measures should
not be considered in isolation, or as a substitute for, or superior
to, financial measures calculated in accordance with GAAP.
Please refer to our "Non-GAAP Financial Measures" description
at the end of this release and the reconciliations we provide of
these Non-GAAP financial measures to their comparable GAAP
measures.
2 To supplement our financial results presented in
accordance with GAAP and the Non-GAAP Financial Measures discussed
above, we have included an additional analysis, "Non-GAAP Impact of
Special Revenue Items Affecting Year-Over-Year Comparisons," which
presents the change in three Non-GAAP financial measures –
constant-dollar revenue, Adjusted gross margin and Adjusted
operating margin – in each case, excluding certain revenue items
which impact the comparability of our results. These special
revenue items include the impacts of 1) the recognition of tax
credits in 2014 in Brazil for
expected VAT recoveries, which did not recur in 2015 ("2014 Brazil
VAT credits"), 2) a new IPI tax law on cosmetics in Brazil which went into effect in May 2015 ("2015 Brazil IPI tax"), and 3) lower
constant-dollar revenue in the fourth quarter and the full year of
2015 as compared to the fourth quarter and the full year of 2014 as
a result of the sale of Liz Earle in July
2015 ("Liz Earle divestiture"). We believe this additional
analysis helps investors to better understand the underlying
business results. All of these additional adjustments to those
three Non-GAAP financial measures are themselves Non-GAAP financial
measures and should not be considered in isolation, or as a
substitute for, or superior to, financial measures calculated in
accordance with GAAP. Please refer to the reconciliations on
pages 20 and 21 in the schedules of this Release that we
provide of these Non-GAAP financial measures to our other, related
Non-GAAP Financial Measures and then to their comparable GAAP
measures.
Forward-Looking Statements
Statements in this release that are not historical facts may be
forward-looking statements that involve risks and uncertainties
that could cause actual results to differ materially. These risks
and uncertainties are detailed from time to time in reports filed
by Avon Products, Inc. with the Securities and Exchange Commission,
including Forms 8-K, 10-Q, and 10-K. Some forward-looking
statements in this release include and concern our outlook and
expected results, cost-reduction actions and savings, and the
impact of foreign currency, taxes and tax rates. These
forward-looking statements involve risks, uncertainties and other
factors, which may cause the actual results, levels of activity,
performance or achievement of Avon
to be materially different from any future results expressed or
implied by such forward-looking statements. These risks and
uncertainties include, but are not limited to, our ability to
improve our financial and operational performance, our ability to
successfully complete the planned separation of our North America business, the impact of a
continued decline in our business results, the possibility of
business disruption, competitive uncertainties, and general
economic and business conditions in our markets, including
fluctuations in foreign currency exchange rates. Any
forward-looking statements speak only as of the date they are made.
The Company does not undertake to update any such forward-looking
statements.
AVON PRODUCTS,
INC.
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(Unaudited)
|
(In millions,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Percent
|
|
Twelve Months
Ended
|
|
Percent
|
|
|
|
December
31
|
|
Change
|
|
December
31
|
|
Change
|
|
|
|
2015
|
|
2014
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
$
|
1,585.8
|
|
$
|
1,963.7
|
|
(19)%
|
|
$
|
6,076.5
|
|
$
|
7,472.5
|
|
(19)%
|
Other
revenue
|
|
21.5
|
|
|
50.4
|
|
|
|
|
84.0
|
|
|
175.5
|
|
|
Total
revenue
|
|
1,607.3
|
|
|
2,014.1
|
|
(20)%
|
|
|
6,160.5
|
|
|
7,648.0
|
|
(19)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
sales
|
|
663.7
|
|
|
776.3
|
|
|
|
|
2,445.4
|
|
|
3,006.9
|
|
|
Selling, general and
administrative expenses
|
|
873.8
|
|
|
1,063.0
|
|
|
|
|
3,543.2
|
|
|
4,206.8
|
|
|
Impairment of
goodwill and intangible asset
|
|
6.9
|
|
|
-
|
|
|
|
|
6.9
|
|
|
-
|
|
|
Operating
profit
|
|
62.9
|
|
|
174.8
|
|
(64)%
|
|
|
165.0
|
|
|
434.3
|
|
(62)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
32.3
|
|
|
26.9
|
|
|
|
|
120.5
|
|
|
108.8
|
|
|
Loss on
extinguishment of debt
|
|
-
|
|
|
-
|
|
|
|
|
5.5
|
|
|
-
|
|
|
Interest
income
|
|
(2.8)
|
|
|
(3.4)
|
|
|
|
|
(12.5)
|
|
|
(14.8)
|
|
|
Other expense,
net
|
|
26.2
|
|
|
50.4
|
|
|
|
|
73.7
|
|
|
139.5
|
|
|
Gain on sale of
business
|
|
-
|
|
|
-
|
|
|
|
|
(44.9)
|
|
|
-
|
|
|
Total other
expenses
|
|
55.7
|
|
|
73.9
|
|
|
|
|
142.3
|
|
|
233.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
continuing operations, before taxes
|
|
7.2
|
|
|
100.9
|
|
(93)%
|
|
|
22.7
|
|
|
200.8
|
|
(89)%
|
Income
taxes
|
|
|
(22.0)
|
|
|
(406.3)
|
|
|
|
|
(819.2)
|
|
|
(545.3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing
operations, net of tax
|
|
(14.8)
|
|
|
(305.4)
|
|
95%
|
|
|
(796.5)
|
|
|
(344.5)
|
|
*
|
Loss from
discontinued operations, net of tax
|
|
(317.1)
|
|
|
(24.2)
|
|
|
|
|
(349.1)
|
|
|
(40.4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
(331.9)
|
|
|
(329.6)
|
|
|
|
|
(1,145.6)
|
|
|
(384.9)
|
|
|
Net income
attributable to noncontrolling interests
|
|
(1.5)
|
|
|
(1.1)
|
|
|
|
|
(3.3)
|
|
|
(3.7)
|
|
|
Net loss attributable
to Avon
|
$
|
(333.4)
|
|
$
|
(330.7)
|
|
(1)%
|
|
$
|
(1,148.9)
|
|
$
|
(388.6)
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss per
share:(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic loss per share
from continuing operations
|
$
|
(0.04)
|
|
$
|
(0.70)
|
|
94%
|
|
$
|
(1.81)
|
|
$
|
(0.79)
|
|
*
|
Basic loss per share
from discontinued operations
|
|
(0.72)
|
|
|
(0.06)
|
|
|
|
|
(0.79)
|
|
|
(0.09)
|
|
|
Basic loss per share
attributable to Avon
|
$
|
(0.76)
|
|
$
|
(0.75)
|
|
(1)%
|
|
$
|
(2.60)
|
|
$
|
(0.88)
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted loss per
share from continuing operations
|
$
|
(0.04)
|
|
$
|
(0.70)
|
|
94%
|
|
$
|
(1.81)
|
|
$
|
(0.79)
|
|
*
|
Diluted loss per
share from discontinued operations
|
|
(0.72)
|
|
|
(0.06)
|
|
|
|
|
(0.79)
|
|
|
(0.09)
|
|
|
Diluted loss per
share attributable to Avon
|
$
|
(0.76)
|
|
$
|
(0.75)
|
|
(1)%
|
|
$
|
(2.60)
|
|
$
|
(0.88)
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
435.4
|
|
|
434.7
|
|
|
|
|
435.2
|
|
|
434.5
|
|
|
Diluted
|
|
435.4
|
|
|
434.7
|
|
|
|
|
435.2
|
|
|
434.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Calculation not
meaningful
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Under the two-class method, loss per share is calculated using net
loss allocable to common shares, which is derived by reducing net
loss by the loss allocable to participating securities. Net loss
allocable to common shares used in the basic and diluted loss per
share calculation was ($329.8) and $327.6 for the three months
ended December 31, 2015 and 2014, respectively. Net loss allocable
to common shares used in the basic and diluted loss per share
calculation was ($1,133.2) and ($383.9) for the twelve months ended
December 31, 2015 and 2014, respectively.
|
AVON PRODUCTS,
INC.
|
CONSOLIDATED
BALANCE SHEETS
|
(Unaudited)
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31
|
|
December
31
|
|
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
$
|
686.9
|
|
$
|
936.4
|
Accounts receivable,
net
|
|
|
|
443.0
|
|
|
515.6
|
Inventories
|
|
|
|
|
624.0
|
|
|
707.7
|
Prepaid expenses and
other
|
|
|
|
296.1
|
|
|
590.7
|
Current assets of
discontinued operations
|
|
|
291.1
|
|
|
314.1
|
Total current
assets
|
|
|
|
2,341.1
|
|
|
3,064.5
|
|
|
|
|
|
|
|
|
|
|
Property, plant and
equipment, at cost
|
|
|
1,495.7
|
|
|
1,867.9
|
Less accumulated
depreciation
|
|
|
|
(728.8)
|
|
|
(831.1)
|
Property, plant and
equipment, net
|
|
|
766.9
|
|
|
1,036.8
|
|
|
|
|
|
|
|
|
|
|
Goodwill
|
|
|
|
|
|
92.3
|
|
|
249.3
|
Other
assets
|
|
|
|
|
499.1
|
|
|
1,034.3
|
Noncurrent assets of
discontinued operations
|
|
180.1
|
|
|
211.9
|
Total
assets
|
|
|
|
$
|
3,879.5
|
|
$
|
5,596.8
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Shareholders' (Deficit) Equity
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
|
|
|
Debt maturing within
one year
|
|
|
$
|
55.2
|
|
$
|
121.7
|
Accounts
payable
|
|
|
|
|
774.2
|
|
|
806.3
|
Accrued
compensation
|
|
|
|
157.6
|
|
|
174.9
|
Other accrued
liabilities
|
|
|
|
419.6
|
|
|
539.1
|
Sales and taxes other
than income
|
|
|
174.9
|
|
|
160.8
|
Income
taxes
|
|
|
|
|
23.9
|
|
|
36.8
|
Payable to
discontinued operations
|
|
|
100.0
|
|
|
100.0
|
Current liabilities
of discontinued operations
|
|
|
489.7
|
|
|
207.6
|
Total current
liabilities
|
|
|
|
2,195.1
|
|
|
2,147.2
|
Long-term
debt
|
|
|
|
|
2,159.6
|
|
|
2,428.7
|
Employee benefit
plans
|
|
|
|
177.5
|
|
|
249.6
|
Long-term income
taxes
|
|
|
|
65.1
|
|
|
75.2
|
Other
liabilities
|
|
|
|
|
78.4
|
|
|
93.8
|
Noncurrent
liabilities of discontinued operations
|
|
260.2
|
|
|
297.0
|
Total
liabilities
|
|
|
|
|
4,935.9
|
|
|
5,291.5
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
(Deficit) Equity
|
|
|
|
|
|
|
|
Common
stock
|
|
|
|
|
187.9
|
|
|
187.6
|
Additional
paid-in-capital
|
|
|
|
2,254.0
|
|
|
2,207.9
|
Retained
earnings
|
|
|
|
|
2,448.1
|
|
|
3,702.9
|
Accumulated other
comprehensive loss
|
|
|
(1,366.2)
|
|
|
(1,217.6)
|
Treasury stock, at
cost
|
|
|
|
(4,594.1)
|
|
|
(4,591.0)
|
Total Avon
shareholders' (deficit) equity
|
|
(1,070.3)
|
|
|
289.8
|
Noncontrolling
interests
|
|
|
|
13.9
|
|
|
15.5
|
Total shareholders'
(deficit) equity
|
|
|
(1,056.4)
|
|
|
305.3
|
Total liabilities
and shareholders' (deficit) equity
|
$
|
3,879.5
|
|
$
|
5,596.8
|
|
|
|
|
|
|
|
|
|
|
AVON PRODUCTS,
INC.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(Unaudited)
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months
Ended
|
|
|
|
|
|
|
|
December
31
|
|
|
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Operating Activities of Continuing Operations
|
|
|
|
|
|
Net loss
|
|
|
|
|
|
$
|
(1,145.6)
|
|
$
|
(384.9)
|
Loss from
discontinued operations, net of tax
|
|
|
|
349.1
|
|
|
40.4
|
Loss from continuing
operations, net of tax
|
|
|
$
|
(796.5)
|
|
$
|
(344.5)
|
Adjustments to
reconcile net loss to net cash provided by operating
activities:
|
|
|
|
|
|
Depreciation
|
|
|
|
|
|
94.0
|
|
|
121.7
|
Amortization
|
|
|
|
|
|
32.1
|
|
|
47.7
|
Provision for
doubtful accounts
|
|
|
|
144.1
|
|
|
171.1
|
Provision for
obsolescence
|
|
|
|
|
45.4
|
|
|
78.4
|
Share-based
compensation
|
|
|
|
|
51.2
|
|
|
38.9
|
Foreign exchange
losses
|
|
|
|
|
44.3
|
|
|
41.4
|
Deferred income
taxes
|
|
|
|
|
644.6
|
|
|
236.4
|
Charge for Venezuelan
monetary assets and liabilities
|
|
|
(4.2)
|
|
|
53.7
|
Charge for Venezuelan
non-monetary assets
|
|
|
101.7
|
|
|
115.7
|
Pre-tax gain on sale
of business
|
|
|
|
(44.9)
|
|
|
-
|
Impairment of
goodwill and intangible assets
|
|
|
6.9
|
|
|
-
|
Other
|
|
|
|
|
|
|
11.6
|
|
|
10.8
|
|
|
|
|
|
|
|
|
|
|
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
|
|
(184.7)
|
|
|
(179.0)
|
Inventories
|
|
|
|
|
|
(106.6)
|
|
|
(170.5)
|
Prepaid expenses and
other
|
|
|
|
|
8.7
|
|
|
(77.0)
|
Accounts payable and
accrued liabilities
|
|
|
|
80.4
|
|
|
142.6
|
Income and other
taxes
|
|
|
|
|
50.7
|
|
|
57.5
|
Noncurrent assets and
liabilities
|
|
|
|
(87.4)
|
|
|
(56.0)
|
Net cash provided
by operating activities of continuing operations
|
|
91.4
|
|
|
288.9
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Investing Activities of Continuing Operations
|
|
|
|
|
|
Capital
expenditures
|
|
|
|
|
|
(92.4)
|
|
|
(126.3)
|
Disposal of
assets
|
|
|
|
|
|
8.2
|
|
|
15.7
|
Net proceeds from
sale of business
|
|
|
|
|
208.3
|
|
|
-
|
Purchases of
investments
|
|
|
|
|
(35.3)
|
|
|
(26.8)
|
Proceeds from sale of
investments
|
|
|
|
|
53.7
|
|
|
36.9
|
Net cash provided
(used) by investing activities of continuing
operations
|
|
142.5
|
|
|
(100.5)
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Financing Activities of Continuing Operations
|
|
|
|
|
|
Cash
dividends
|
|
|
|
|
|
(108.8)
|
|
|
(110.2)
|
Debt, net (maturities
of three months or less)
|
|
|
|
(59.1)
|
|
|
(22.4)
|
Proceeds from
debt
|
|
|
|
|
|
7.6
|
|
|
-
|
Repayment of
debt
|
|
|
|
|
|
(261.2)
|
|
|
(66.5)
|
Net proceeds from
exercise of stock options
|
|
|
|
-
|
|
|
0.2
|
Repurchase of common
stock
|
|
|
|
|
(3.1)
|
|
|
(9.8)
|
Other financing
activities
|
|
|
|
|
|
(5.9)
|
|
|
-
|
Net cash used by
financing activities of continuing operations
|
|
(430.5)
|
|
|
(208.7)
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Discontinued Operations
|
|
|
|
|
|
Net cash provided by
operating activities of discontinued operations
|
|
20.7
|
|
|
70.9
|
Net cash used by
investing activities of discontinued operations
|
|
(4.2)
|
|
|
(4.6)
|
Net cash used by
financing activities of discontinued operations
|
|
(15.0)
|
|
|
(10.1)
|
Net cash provided
by discontinued operations
|
|
|
1.5
|
|
|
56.2
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
(80.7)
|
|
|
(183.3)
|
Net decrease in cash
and cash equivalents
|
|
|
|
(275.8)
|
|
|
(147.4)
|
Cash and cash
equivalents at beginning of year (1)
|
|
|
960.5
|
|
|
1,107.9
|
Cash and cash
equivalents at end of year (2)
|
|
|
$
|
684.7
|
|
$
|
960.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Includes cash and cash equivalents of discontinued operations of
$24.1 and $17.9 at the beginning of the year in 2015 and 2014,
respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)
Includes cash and cash equivalents of discontinued operations of
($2.2) and $24.1 at the end of the year in 2015 and 2014,
respectively.
|
AVON PRODUCTS,
INC.
|
SUPPLEMENTAL
SCHEDULE
|
SEGMENT
PERFORMANCE METRICS
|
(Unaudited)
|
(In millions,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS ENDED
DECEMBER 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
REGIONAL
RESULTS
|
|
|
Revenue
|
|
Active
Reps
|
|
Average
Order
C$
|
|
Units
Sold
|
|
Price/Mix
C$
|
Revenue &
Drivers
|
|
US$
|
|
C$
|
|
|
|
|
|
|
|
% var.
vs
4Q14
|
|
% var.
vs
4Q14
|
|
% var.
vs
4Q14
|
|
% var.
vs
4Q14
|
|
% var.
vs
4Q14
|
|
% var.
vs
4Q14
|
Latin
America
|
$
|
779.2
|
|
(26)%
|
|
-%
|
|
|
(1)%
|
|
1%
|
|
(6)%
|
|
6%
|
Europe, Middle East
& Africa
|
|
669.5
|
|
(13)
|
|
6
|
|
|
8
|
|
(2)
|
|
7
|
|
(1)
|
Asia
Pacific
|
|
158.6
|
|
(16)
|
|
(8)
|
|
|
-
|
|
(8)
|
|
(7)
|
|
(1)
|
Total from
operations
|
|
1,607.3
|
|
(20)
|
|
1
|
|
|
2
|
|
(1)
|
|
(2)
|
|
3
|
Global and
other
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
-
|
|
-
|
|
-
|
Total
|
$
|
1,607.3
|
|
(20)%
|
|
1%
|
|
|
2%
|
|
(1)%
|
|
(2)%
|
|
3%
|
|
|
|
|
2015
GAAP
|
|
Adjusted Operating
Profit
(Loss) in
US$
|
|
Adjusted Operating
Margin
|
Operating
Profit/Margin
|
Operating
Profit (Loss) US$
|
|
Operating
Margin US$
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
Change
US$
|
|
Change
in
C$
|
Latin
America
|
$
|
47.5
|
|
6.1%
|
|
$
|
49.0
|
|
$
|
93.0
|
|
6.3%
|
|
8.8%
|
|
(250) bps
|
|
(80) bps
|
Europe, Middle East
& Africa
|
|
77.5
|
|
11.6
|
|
|
83.7
|
|
|
107.2
|
|
12.5
|
|
13.9
|
|
(140)
|
|
(70)
|
Asia
Pacific
|
|
8.5
|
|
5.4
|
|
|
8.9
|
|
|
11.7
|
|
5.6
|
|
6.2
|
|
(60)
|
|
10
|
Total from
operations
|
|
133.5
|
|
8.3
|
|
|
141.6
|
|
|
211.9
|
|
8.8
|
|
10.5
|
|
(170)
|
|
(450)
|
Global and
other
|
|
(70.6)
|
|
-
|
|
|
(44.8)
|
|
|
(6.6)
|
|
-
|
|
-
|
|
-
|
|
-
|
Total
|
|
$
|
62.9
|
|
3.9%
|
|
$
|
96.8
|
|
$
|
205.3
|
|
6.0%
|
|
10.2%
|
|
(420) bps
|
|
(260) bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TWELVE MONTHS ENDED
DECEMBER 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
REGIONAL
RESULTS
|
|
|
Revenue
|
|
Active
Reps
|
|
Average
Order
C$
|
|
Units
Sold
|
|
Price/Mix
C$
|
Revenue &
Drivers
|
|
US$
|
|
C$
|
|
|
|
|
|
|
|
% var.
vs
FY14
|
|
% var.
vs
FY14
|
|
% var.
vs
FY14
|
|
% var.
vs
FY14
|
|
% var.
vs
FY14
|
|
% var.
vs
FY14
|
Latin
America
|
$
|
3,260.4
|
|
(23)%
|
|
1%
|
|
|
(2)%
|
|
3%
|
|
(5)%
|
|
6%
|
Europe, Middle East
& Africa
|
|
2,272.3
|
|
(16)
|
|
6
|
|
|
7
|
|
(1)
|
|
5
|
|
1
|
Asia
Pacific
|
|
627.8
|
|
(11)
|
|
(5)
|
|
|
(2)
|
|
(3)
|
|
(7)
|
|
2
|
Total from
operations
|
|
6,160.5
|
|
(19)
|
|
2
|
|
|
1
|
|
1
|
|
(2)
|
|
4
|
Global and
other
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
-
|
|
-
|
|
-
|
Total
|
|
$
|
6,160.5
|
|
(19)%
|
|
2%
|
|
|
1%
|
|
1%
|
|
(2)%
|
|
4%
|
|
|
|
|
2015
GAAP
|
|
Adjusted Operating
Profit
(Loss) in
US$
|
|
Adjusted Operating
Margin
|
Operating
Profit/Margin
|
Operating
Profit (Loss) US$
|
|
Operating
Margin US$
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
Change
in
US$
|
|
Change
in
C$
|
Latin
America
|
$
|
103.1
|
|
3.2%
|
|
$
|
224.9
|
|
$
|
443.6
|
|
6.9%
|
|
10.5%
|
|
(360) bps
|
|
(180) bps
|
Europe, Middle East
& Africa
|
|
217.1
|
|
9.6
|
|
|
227.5
|
|
|
324.1
|
|
10.0
|
|
12.0
|
|
(200)
|
|
(70)
|
Asia
Pacific
|
|
35.3
|
|
5.6
|
|
|
45.9
|
|
|
30.2
|
|
7.3
|
|
4.3
|
|
300
|
|
330
|
Total from
operations
|
|
355.5
|
|
5.8
|
|
|
498.3
|
|
|
797.9
|
|
8.1
|
|
10.4
|
|
(230)
|
|
(270)
|
Global and other
*
|
|
(190.5)
|
|
-
|
|
|
(146.7)
|
|
|
(84.4)
|
|
-
|
|
-
|
|
-
|
|
-
|
Total
|
|
$
|
165.0
|
|
2.7%
|
|
$
|
351.6
|
|
$
|
713.5
|
|
5.7%
|
|
9.3%
|
|
(360) bps
|
|
(180) bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*As a
result of its classification within discontinued operations, Global
and other amounts have been adjusted as compared to amounts
previously reported as Global and other. This is primarily
due to the inclusion of amounts of Global expenses that were
previously allocated to North America, as these represent costs
associated with functions of the Company's continuing
operations.
|
AVON PRODUCTS,
INC.
|
SUPPLEMENTAL
SCHEDULE
|
(Unaudited)
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CATEGORY SALES
(US$)
|
|
|
|
|
|
|
|
|
Consolidated
|
|
|
|
|
|
|
|
|
Three months ended
December 31
|
|
US$
|
|
C$
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
% var.
vs
4Q14
|
|
% var.
vs
4Q14
|
Beauty:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Skincare
|
|
|
|
|
|
|
$
|
435.6
|
|
$
|
568.7
|
|
(23)%
|
|
(1)%
|
Fragrance
|
|
|
|
|
|
|
|
459.2
|
|
|
551.8
|
|
(17)
|
|
6
|
Color
|
|
|
|
|
|
|
|
262.1
|
|
|
342.2
|
|
(23)
|
|
(2)
|
Total
Beauty
|
|
|
|
|
|
|
|
1,156.9
|
|
|
1,462.7
|
|
(21)
|
|
2
|
Fashion &
Home:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fashion
(jewelry/watches/apparel/footwear/accessories/children's)
|
|
|
|
|
250.9
|
|
|
278.7
|
|
(10)
|
|
9
|
Home (gift &
decorative products/housewares/entertainment &
leisure/children's/nutrition)
|
|
178.0
|
|
|
222.3
|
|
(20)
|
|
1
|
Total Fashion &
Home
|
|
|
|
|
|
|
|
428.9
|
|
|
501.0
|
|
(14)
|
|
5
|
Net sales
|
|
|
|
|
|
|
|
1,585.8
|
|
|
1,963.7
|
|
(19)
|
|
2
|
Other
revenue
|
|
|
|
|
|
|
|
21.5
|
|
|
50.4
|
|
(57)
|
|
(46)
|
Total
revenue
|
|
|
|
|
|
|
$
|
1,607.3
|
|
$
|
2,014.1
|
|
(20)
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
|
|
|
|
|
|
|
|
Twelve months
ended December 31
|
|
US$
|
|
C$
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
% var.
vs
FY14
|
|
% var.
vs
FY14
|
Beauty:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Skincare
|
|
|
|
|
|
|
$
|
1,791.2
|
|
$
|
2,281.0
|
|
(21)%
|
|
-%
|
Fragrance
|
|
|
|
|
|
|
|
1,632.8
|
|
|
1,966.3
|
|
(17)
|
|
7
|
Color
|
|
|
|
|
|
|
|
1,078.1
|
|
|
1,365.1
|
|
(21)
|
|
1
|
Total
Beauty
|
|
|
|
|
|
|
|
4,502.1
|
|
|
5,612.4
|
|
(20)
|
|
3
|
Fashion &
Home:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fashion
(jewelry/watches/apparel/footwear/accessories/children's)
|
|
|
|
|
907.8
|
|
|
1,040.4
|
|
(13)
|
|
6
|
Home (gift &
decorative products/housewares/entertainment &
leisure/children's/nutrition)
|
|
666.6
|
|
|
819.7
|
|
(19)
|
|
4
|
Total Fashion &
Home
|
|
|
|
|
|
|
|
1,574.4
|
|
|
1,860.1
|
|
(15)
|
|
5
|
Net sales
|
|
|
|
|
|
|
|
6,076.5
|
|
|
7,472.5
|
|
(19)
|
|
3
|
Other
revenue
|
|
|
|
|
|
|
|
84.0
|
|
|
175.5
|
|
(52)
|
|
(40)
|
Total
revenue
|
|
|
|
|
|
|
$
|
6,160.5
|
|
$
|
7,648.0
|
|
(19)
|
|
2
|
|
AVON PRODUCTS,
INC.
|
SUPPLEMENTAL
SCHEDULE
|
NON-GAAP FINANCIAL
MEASURES
|
(Unaudited)
|
(In millions,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
This supplemental
schedule provides adjusted Non-GAAP financial information and a
quantitative reconciliation of the difference between
the Non-GAAP financial
measure and the financial measure calculated and reported in
accordance with GAAP.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS ENDED
DECEMBER 31, 2015
|
|
|
|
|
|
|
CTI
|
|
|
|
|
Pension
|
|
Asset
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported
|
|
restructuring
|
|
Venezuelan
|
|
settlement
|
|
impairment
and
|
|
Other
|
|
Special
|
|
Adjusted
|
|
|
|
(GAAP)
|
|
initiatives
|
|
special
items
|
|
charge
|
|
other
charges
|
|
items
|
|
tax items
|
|
(Non-GAAP)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue
|
|
|
$
|
1,607.3
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
1,607.3
|
Cost of
sales
|
|
|
|
663.7
|
|
|
-
|
|
|
1.9
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
661.8
|
Selling, general and
administrative expenses
|
|
873.8
|
|
|
20.9
|
|
|
-
|
|
|
1.1
|
|
|
-
|
|
|
3.1
|
|
|
-
|
|
|
848.7
|
Impairment of
goodwill and intangible assets
|
|
6.9
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
6.9
|
|
|
-
|
|
|
-
|
|
|
-
|
Operating
profit
|
|
|
|
62.9
|
|
|
20.9
|
|
|
1.9
|
|
|
1.1
|
|
|
6.9
|
|
|
3.1
|
|
|
-
|
|
|
96.8
|
Income from
continuing operations, before taxes
|
|
7.2
|
|
|
20.9
|
|
|
1.9
|
|
|
1.1
|
|
|
6.9
|
|
|
3.1
|
|
|
-
|
|
|
41.1
|
Income
taxes
|
|
|
|
(22.0)
|
|
|
0.3
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(18.7)
|
|
|
(40.4)
|
(Loss) income from
continuing operations, net of tax
|
$
|
(14.8)
|
|
$
|
21.2
|
|
$
|
1.9
|
|
$
|
1.1
|
|
$
|
6.9
|
|
$
|
3.1
|
|
$
|
(18.7)
|
|
$
|
0.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted EPS from
continuing operations
|
$
|
(0.04)
|
|
$
|
0.05
|
|
$
|
-
|
|
$
|
-
|
|
$
|
0.01
|
|
$
|
-
|
|
$
|
(0.04)
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
58.7%
|
|
|
-
|
|
|
0.1
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
58.8%
|
SG&A as a % of
revenues
|
|
|
54.4%
|
|
|
(1.3)
|
|
|
-
|
|
|
(0.1)
|
|
|
-
|
|
|
(0.2)
|
|
|
-
|
|
|
52.8%
|
Operating
margin
|
|
3.9%
|
|
|
1.3
|
|
|
0.1
|
|
|
0.1
|
|
|
0.4
|
|
|
0.2
|
|
|
-
|
|
|
6.0%
|
Effective tax
rate
|
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
98.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SEGMENT OPERATING
PROFIT (LOSS)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Latin
America
|
$
|
47.5
|
|
$
|
(0.4)
|
|
$
|
1.9
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
49.0
|
Europe, Middle East
& Africa
|
|
77.5
|
|
|
(0.7)
|
|
|
-
|
|
|
-
|
|
|
6.9
|
|
|
-
|
|
|
-
|
|
|
83.7
|
Asia
Pacific
|
|
8.5
|
|
|
0.4
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
8.9
|
Global and
other
|
|
(70.6)
|
|
|
21.6
|
|
|
-
|
|
|
1.1
|
|
|
-
|
|
|
3.1
|
|
|
-
|
|
|
(44.8)
|
Total
|
|
|
$
|
62.9
|
|
$
|
20.9
|
|
$
|
1.9
|
|
$
|
1.1
|
|
$
|
6.9
|
|
$
|
3.1
|
|
$
|
-
|
|
$
|
96.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SEGMENT OPERATING
MARGIN
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Latin
America
|
|
6.1%
|
|
|
(0.1)
|
|
|
0.2
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
6.3%
|
Europe, Middle East
& Africa
|
|
|
11.6%
|
|
|
(0.1)
|
|
|
-
|
|
|
-
|
|
|
1.0
|
|
|
-
|
|
|
-
|
|
|
12.5%
|
Asia
Pacific
|
|
5.4%
|
|
|
0.3
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
5.6%
|
Global and
other
|
|
-%
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-%
|
Total
|
|
|
|
3.9%
|
|
|
1.3
|
|
|
0.1
|
|
|
0.1
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
6.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts in the table
above may not necessarily sum because the computations are made
independently.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Calculation not
meaningful
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVON PRODUCTS,
INC.
|
SUPPLEMENTAL
SCHEDULE
|
NON-GAAP FINANCIAL
MEASURES
|
(Unaudited)
|
(In millions,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
This supplemental
schedule provides adjusted Non-GAAP financial information and a
quantitative reconciliation of the difference between
the Non-GAAP financial measure
and the financial measure calculated and reported in accordance
with GAAP.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TWELVE MONTHS
ENDED DECEMBER 31, 2015
|
|
|
|
|
|
CTI
|
|
|
|
|
Pension
|
|
Asset
|
|
|
|
|
|
|
|
|
|
|
|
Reported
|
|
restructuring
|
|
Venezuelan
|
|
settlement
|
|
impairment
and
|
|
Other
|
|
Special
|
|
Adjusted
|
|
|
|
(GAAP)
|
|
initiatives
|
|
special
items
|
|
charge
|
|
other
charges
|
|
items
|
|
tax items
|
|
(Non-GAAP)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue
|
$
|
6,160.5
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
6,160.5
|
Cost of
sales
|
|
2,445.4
|
|
|
-
|
|
|
28.5
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
2,416.9
|
Selling, general and
administrative expenses
|
|
3,543.2
|
|
|
49.1
|
|
|
91.7
|
|
|
7.3
|
|
|
-
|
|
|
3.1
|
|
|
-
|
|
|
3,392.0
|
Impairment of
goodwill and intangible asset
|
|
6.9
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
6.9
|
|
|
-
|
|
|
-
|
|
|
-
|
Operating
profit
|
|
165.0
|
|
|
49.1
|
|
|
120.2
|
|
|
7.3
|
|
|
6.9
|
|
|
3.1
|
|
|
-
|
|
|
351.6
|
Income from
continuing operations, before taxes
|
|
22.7
|
|
|
49.1
|
|
|
116.0
|
|
|
7.3
|
|
|
6.9
|
|
|
(33.8)
|
|
|
-
|
|
|
168.2
|
Income
taxes
|
|
(819.2)
|
|
|
(2.4)
|
|
|
0.8
|
|
|
-
|
|
|
-
|
|
|
(6.7)
|
|
|
666.4
|
|
|
(161.1)
|
(Loss) income from
continuing operations, net of tax
|
$
|
(796.5)
|
|
$
|
46.7
|
|
$
|
116.8
|
|
$
|
7.3
|
|
$
|
6.9
|
|
$
|
(40.5)
|
|
$
|
666.4
|
|
$
|
7.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted EPS from
continuing operations
|
$
|
(1.81)
|
|
$
|
0.11
|
|
$
|
0.26
|
|
$
|
0.02
|
|
$
|
0.02
|
|
$
|
(0.09)
|
|
$
|
1.51
|
|
$
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
60.3%
|
|
|
-
|
|
|
0.5
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
60.8%
|
SG&A as a % of
revenues
|
|
57.5%
|
|
|
(0.8)
|
|
|
(1.5)
|
|
|
(0.1)
|
|
|
-
|
|
|
(0.1)
|
|
|
-
|
|
|
55.1%
|
Operating
margin
|
|
2.7%
|
|
|
0.8
|
|
|
2.0
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
-
|
|
|
5.7%
|
Effective tax
rate
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
95.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SEGMENT OPERATING
PROFIT (LOSS)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Latin
America
|
$
|
103.1
|
|
$
|
1.6
|
|
$
|
120.2
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
224.9
|
Europe, Middle East
& Africa
|
|
217.1
|
|
|
3.5
|
|
|
-
|
|
|
-
|
|
|
6.9
|
|
|
-
|
|
|
-
|
|
|
227.5
|
Asia
Pacific
|
|
35.3
|
|
|
10.6
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
45.9
|
Global and
other
|
|
(190.5)
|
|
|
33.4
|
|
|
-
|
|
|
7.3
|
|
|
-
|
|
|
3.1
|
|
|
-
|
|
|
(146.7)
|
Total
|
$
|
165.0
|
|
$
|
49.1
|
|
$
|
120.2
|
|
$
|
7.3
|
|
$
|
6.9
|
|
$
|
3.1
|
|
$
|
-
|
|
$
|
351.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SEGMENT OPERATING
MARGIN
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Latin
America
|
|
3.2%
|
|
|
-
|
|
|
3.7
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
6.9%
|
Europe, Middle East
& Africa
|
|
9.6%
|
|
|
0.2
|
|
|
-
|
|
|
-
|
|
|
0.3
|
|
|
-
|
|
|
-
|
|
|
10.0%
|
Asia
Pacific
|
|
5.6%
|
|
|
1.7
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
7.3%
|
Global and
other
|
|
-%
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-%
|
Total
|
|
|
2.7%
|
|
|
0.8
|
|
|
2.0
|
|
|
0.1
|
|
|
0.1
|
|
|
-
|
|
|
-
|
|
|
5.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts in the table
above may not necessarily sum because the computations are made
independently.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Calculation not
meaningful
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVON PRODUCTS,
INC.
|
SUPPLEMENTAL
SCHEDULE
|
NON-GAAP FINANCIAL
MEASURES
|
(Unaudited)
|
(In millions,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
This supplemental
schedule provides adjusted Non-GAAP financial information and a
quantitative reconciliation of the difference between
the Non-GAAP financial
measure and the financial measure calculated and reported in
accordance with GAAP.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS ENDED
DECEMBER 31, 2014
|
|
|
|
|
|
CTI
|
|
|
|
|
|
Pension
|
|
|
|
|
|
|
|
Reported
|
|
restructuring
|
|
Venezuelan
|
|
FCPA
|
|
settlement
|
|
Special
|
|
Adjusted
|
|
|
|
(GAAP)
|
|
initiatives
|
|
special
items
|
|
accrual
|
|
charge
|
|
tax items
|
|
(Non-GAAP)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue
|
$
|
2,014.1
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
2,014.1
|
Cost of
sales
|
|
776.3
|
|
|
-
|
|
|
1.4
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
774.9
|
Selling, general and
administrative expenses
|
|
1,063.0
|
|
|
27.1
|
|
|
-
|
|
|
-
|
|
|
2.0
|
|
|
-
|
|
|
1,033.9
|
Operating
profit
|
|
174.8
|
|
|
27.1
|
|
|
1.4
|
|
|
-
|
|
|
2.0
|
|
|
-
|
|
|
205.3
|
Income from
continuing operations, before taxes
|
|
100.9
|
|
|
27.1
|
|
|
1.4
|
|
|
-
|
|
|
2.0
|
|
|
-
|
|
|
131.4
|
Income
taxes
|
|
(406.3)
|
|
|
(7.6)
|
|
|
-
|
|
|
(18.5)
|
|
|
(0.7)
|
|
|
395.7
|
|
|
(37.4)
|
(Loss) income from
continuing operations, net of tax
|
$
|
(305.4)
|
|
$
|
19.5
|
|
$
|
1.4
|
|
$
|
(18.5)
|
|
$
|
1.3
|
|
$
|
395.7
|
|
$
|
94.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted EPS from
continuing operations
|
$
|
(0.70)
|
|
$
|
0.04
|
|
$
|
-
|
|
$
|
(0.04)
|
|
$
|
-
|
|
$
|
0.90
|
|
$
|
0.21
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
61.5%
|
|
|
-
|
|
|
0.1
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
61.5%
|
SG&A as a % of
revenues
|
|
52.8%
|
|
|
(1.3)
|
|
|
-
|
|
|
-
|
|
|
(0.1)
|
|
|
-
|
|
|
51.3%
|
Operating
margin
|
|
8.7%
|
|
|
1.3
|
|
|
0.1
|
|
|
-
|
|
|
0.1
|
|
|
-
|
|
|
10.2%
|
Effective tax
rate
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
28.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SEGMENT OPERATING
PROFIT (LOSS)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Latin
America
|
$
|
82.9
|
|
$
|
8.7
|
|
$
|
1.4
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
93.0
|
Europe, Middle East
& Africa
|
|
101.2
|
|
|
6.0
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
107.2
|
Asia
Pacific
|
|
5.3
|
|
|
6.4
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
11.7
|
Global and
other
|
|
(14.6)
|
|
|
6.0
|
|
|
-
|
|
|
-
|
|
|
2.0
|
|
|
-
|
|
|
(6.6)
|
Total
|
|
|
$
|
174.8
|
|
$
|
27.1
|
|
$
|
1.4
|
|
$
|
-
|
|
$
|
2.0
|
|
$
|
-
|
|
$
|
205.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SEGMENT OPERATING
MARGIN
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Latin
America
|
|
7.9%
|
|
|
0.8
|
|
|
0.1
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
8.8%
|
Europe, Middle East
& Africa
|
|
13.1%
|
|
|
0.8
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
13.9%
|
Asia
Pacific
|
|
2.8%
|
|
|
3.4
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
6.2%
|
Global and
other
|
|
-%
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-%
|
Total
|
|
8.7%
|
|
|
1.3
|
|
|
0.1
|
|
|
-
|
|
|
0.1
|
|
|
-
|
|
|
10.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts in the table
above may not necessarily sum because the computations are made
independently.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Calculation not
meaningful
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVON PRODUCTS,
INC.
|
SUPPLEMENTAL
SCHEDULE
|
NON-GAAP FINANCIAL
MEASURES
|
(Unaudited)
|
(In millions,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
This supplemental
schedule provides adjusted Non-GAAP financial information and a
quantitative reconciliation of the difference between
the Non-GAAP financial
measure and the financial measure calculated and reported in
accordance with GAAP.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TWELVE MONTHS
ENDED DECEMBER 31, 2014
|
|
|
|
|
|
CTI
|
|
|
|
|
|
|
Pension
|
|
|
|
|
|
|
|
|
Reported
|
|
restructuring
|
|
Venezuelan
|
|
FCPA
|
|
settlement
|
|
Special
|
|
Adjusted
|
|
|
|
(GAAP)
|
|
initiatives
|
|
special
items
|
|
accrual
|
|
charge
|
|
tax items
|
|
(Non-GAAP)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue
|
$
|
7,648.0
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
7,648.0
|
Cost of
sales
|
|
3,006.9
|
|
|
-
|
|
|
121.1
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
2,885.8
|
Selling, general and
administrative expenses
|
|
4,206.8
|
|
|
86.6
|
|
|
16.0
|
|
|
46.0
|
|
|
9.5
|
|
|
-
|
|
|
4,048.7
|
Operating
profit
|
|
434.3
|
|
|
86.6
|
|
|
137.1
|
|
|
46.0
|
|
|
9.5
|
|
|
-
|
|
|
713.5
|
Income from
continuing operations, before taxes
|
|
200.8
|
|
|
86.6
|
|
|
190.8
|
|
|
46.0
|
|
|
9.5
|
|
|
|
|
|
533.7
|
Income
taxes
|
|
(545.3)
|
|
|
(22.2)
|
|
|
(11.9)
|
|
|
(18.5)
|
|
|
(3.4)
|
|
|
395.7
|
|
|
(205.6)
|
(Loss) income from
continuing operations, net of tax
|
$
|
(344.5)
|
|
$
|
64.4
|
|
$
|
178.9
|
|
$
|
27.5
|
|
$
|
6.1
|
|
$
|
395.7
|
|
$
|
328.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted EPS from
continuing operations
|
$
|
(0.79)
|
|
$
|
0.15
|
|
|
0.41
|
|
$
|
0.06
|
|
$
|
0.01
|
|
$
|
0.90
|
|
$
|
0.74
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
60.7%
|
|
|
-
|
|
|
1.6
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
62.3%
|
SG&A as a % of
revenues
|
|
55.0%
|
|
|
(1.1)
|
|
|
(0.2)
|
|
|
(0.6)
|
|
|
(0.1)
|
|
|
-
|
|
|
52.9%
|
Operating
margin
|
|
5.7%
|
|
|
1.1
|
|
|
1.8
|
|
|
0.6
|
|
|
0.1
|
|
|
-
|
|
|
9.3%
|
Effective tax
rate
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
38.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SEGMENT OPERATING
PROFIT (LOSS)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Latin
America
|
$
|
279.8
|
|
$
|
26.7
|
|
$
|
137.1
|
|
$
|
-
|
|
$
|
-
|
|
|
-
|
|
$
|
443.6
|
Europe, Middle East
& Africa
|
|
300.9
|
|
|
23.2
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
324.1
|
Asia
Pacific
|
|
20.9
|
|
|
9.3
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
30.2
|
Global and
other
|
|
(167.3)
|
|
|
27.4
|
|
|
-
|
|
|
46.0
|
|
|
9.5
|
|
|
-
|
|
|
(84.4)
|
Total
|
$
|
434.3
|
|
$
|
86.6
|
|
$
|
137.1
|
|
$
|
46.0
|
|
$
|
9.5
|
|
$
|
-
|
|
$
|
713.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SEGMENT OPERATING
MARGIN
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Latin
America
|
|
6.6%
|
|
|
0.6
|
|
|
3.2
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
10.5%
|
Europe, Middle East
& Africa
|
|
11.1%
|
|
|
0.9
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
12.0%
|
Asia
Pacific
|
|
3.0%
|
|
|
1.3
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
4.3%
|
Global and
other
|
|
-%
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-%
|
Total
|
|
5.7%
|
|
|
1.1
|
|
|
1.8
|
|
|
0.6
|
|
|
0.1
|
|
|
-
|
|
|
9.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts in the table
above may not necessarily sum because the computations are made
independently.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Calculation not
meaningful
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVON PRODUCTS,
INC.
|
SUPPLEMENTAL
SCHEDULE
|
NON-GAAP IMPACT OF
SPECIAL REVENUE ITEMS AFFECTING YEAR-OVER-YEAR
COMPARISONS
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
This supplemental
schedule provides adjusted Non-GAAP financial information and a
quantitative reconciliation of the difference between the Non-GAAP
financial measures shown, other related Non-GAAP financial measures
we present elsewhere and the financial measures calculated and
reported in accordance with GAAP.
|
|
|
THREE MONTHS ENDED
DECEMBER 31, 2015
|
|
|
|
|
|
|
|
|
|
Constant $
revenue
|
|
|
|
|
|
|
Year-over-Year
Impacts of:
|
|
|
|
|
|
|
Revenue %
change
|
|
C$ revenue %
change
|
|
2014
Brazil
VAT
credits
|
|
2015
Brazil
IPI tax
|
|
Liz Earle
divestiture
|
|
C$ revenue
%
change,
excluding
special revenue
items
|
|
C$ revenue %
change,
excluding Liz
Earle
divestiture
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Avon
|
|
(20)%
|
|
1%
|
|
1 pt
|
|
2 pts
|
|
2 pts
|
|
6%
|
|
3%
|
Latin
America
|
|
(26)%
|
|
-%
|
|
2 pts
|
|
4 pts
|
|
-
|
|
6%
|
|
|
Brazil
|
|
(44)%
|
|
(14)%
|
|
4 pts
|
|
8 pts
|
|
-
|
|
(2)%
|
|
|
Europe, Middle East
& Africa
|
|
(13)%
|
|
6%
|
|
-
|
|
-
|
|
4 pts
|
|
10%
|
|
10%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
Margin
|
|
Operating
Margin
|
|
|
Total Avon
|
|
2015
|
|
2014
|
|
Change
|
|
2015
|
|
2014
|
|
Change
|
|
|
Reported
(GAAP)
|
|
58.7%
|
|
61.5%
|
|
(280) bps
|
|
3.9%
|
|
8.7%
|
|
(480) bps
|
|
|
Adjusted
(Non-GAAP)
|
|
58.8%
|
|
61.5%
|
|
(270) bps
|
|
6.0%
|
|
10.2%
|
|
(420) bps
|
|
|
Impacts
of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015 Brazil IPI
tax
|
|
20 bps
|
|
-
|
|
|
|
100 bps
|
|
-
|
|
|
|
|
2014 Brazil VAT
credits
|
|
-
|
|
(50) bps
|
|
|
|
-
|
|
(110) bps
|
|
|
|
|
Adjusted, excluding
special revenue items
|
|
59.0%
|
|
61.0%
|
|
(200) bps
|
|
7.0%
|
|
9.1%
|
|
(210) bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Margin
|
|
|
Latin
America
|
|
|
|
|
|
|
|
2015
|
|
2014
|
|
Change
|
|
|
Reported
(GAAP)
|
|
|
|
|
|
|
|
6.1%
|
|
7.9%
|
|
(180) bps
|
|
|
Adjusted
(Non-GAAP)
|
|
|
|
|
|
|
|
6.3%
|
|
8.8%
|
|
(250) bps
|
|
|
Impacts
of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015 Brazil IPI
tax
|
|
|
|
|
|
|
|
190 bps
|
|
-
|
|
|
|
|
2014 Brazil VAT
credits
|
|
|
|
|
|
|
|
-
|
|
(220) bps
|
|
|
|
|
Adjusted, excluding
special revenue items
|
|
|
|
|
|
|
|
8.2%
|
|
6.6%
|
|
160 bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Liz Earle has
an immaterial impact on the Adjusted gross margin and Adjusted
operating margin change of Total Avon and Europe, Middle East &
Africa.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Refer to the Non-GAAP
Financial Measures schedules for the reconciliation of the Adjusted
Non-GAAP financial measures.
|
|
|
|
|
AVON PRODUCTS,
INC.
|
SUPPLEMENTAL
SCHEDULE
|
NON-GAAP IMPACT OF
SPECIAL REVENUE ITEMS AFFECTING YEAR-OVER-YEAR
COMPARISONS
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
This supplemental
schedule provides adjusted Non-GAAP financial information and a
quantitative reconciliation of the difference between the Non-GAAP
financial measures shown, other related Non-GAAP financial measures
we present elsewhere and the financial measures calculated and
reported in accordance with GAAP.
|
|
|
|
TWELVE MONTHS
ENDED DECEMBER 31, 2015
|
|
|
|
|
|
|
|
|
|
Constant $
revenue
|
|
|
|
|
|
|
Year-over-Year
Impacts of:
|
|
|
|
|
|
|
Revenue %
change
|
|
C$ revenue %
change
|
|
2014
Brazil
VAT
credits
|
|
2015
Brazil
IPI tax
|
|
Liz Earle
divestiture
|
|
C$ revenue
%
change,
excluding
special revenue
items
|
|
C$ revenue %
change,
excluding Liz
Earle
divestiture
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Avon
|
|
(19)%
|
|
2%
|
|
1 pt
|
|
1 pt
|
|
1 pt
|
|
5%
|
|
3%
|
Latin
America
|
|
(23)%
|
|
1%
|
|
2 pts
|
|
3 pts
|
|
-
|
|
6%
|
|
|
Brazil
|
|
(34)%
|
|
(8)%
|
|
5 pts
|
|
5 pts
|
|
-
|
|
2%
|
|
|
Europe, Middle East
& Africa
|
|
(16)%
|
|
6%
|
|
-
|
|
-
|
|
2 pts
|
|
8%
|
|
8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
Margin
|
|
Operating
Margin
|
|
|
Total Avon
|
|
2015
|
|
2014
|
|
Change
|
|
2015
|
|
2014
|
|
Change
|
|
|
Reported
(GAAP)
|
|
60.3%
|
|
60.7%
|
|
(40) bps
|
|
2.7%
|
|
5.7%
|
|
(300) bps
|
|
|
Adjusted
(Non-GAAP)
|
|
60.8%
|
|
62.3%
|
|
(150) bps
|
|
5.7%
|
|
9.3%
|
|
(360) bps
|
|
|
Impacts
of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015 Brazil IPI
tax
|
|
20 bps
|
|
-
|
|
|
|
80 bps
|
|
-
|
|
|
|
|
2014 Brazil VAT
credits
|
|
-
|
|
(40) bps
|
|
|
|
-
|
|
(100) bps
|
|
|
|
|
Adjusted, excluding
special revenue items
|
|
61.0%
|
|
61.9%
|
|
(90) bps
|
|
6.5%
|
|
8.3%
|
|
(180) bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Margin
|
|
|
Latin
America
|
|
|
|
|
|
|
|
2015
|
|
2014
|
|
Change
|
|
|
Reported
(GAAP)
|
|
|
|
|
|
|
|
3.2%
|
|
6.6%
|
|
(340) bps
|
|
|
Adjusted
(Non-GAAP)
|
|
|
|
|
|
|
|
6.9%
|
|
10.5%
|
|
(360) bps
|
|
|
Impacts
of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015 Brazil IPI
tax
|
|
|
|
|
|
|
|
140 bps
|
|
-
|
|
|
|
|
2014 Brazil VAT
credits
|
|
|
|
|
|
|
|
-
|
|
(190) bps
|
|
|
|
|
Adjusted, excluding
special revenue items
|
|
|
|
|
|
|
|
8.3%
|
|
8.6%
|
|
(30) bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Liz Earle has
an immaterial impact on the Adjusted gross margin and Adjusted
operating margin change of Total Avon and Europe, Middle East &
Africa.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Refer to the Non-GAAP
Financial Measures schedules for the reconciliation of the Adjusted
Non-GAAP financial measures.
|
AVON PRODUCTS,
INC.
|
SUPPLEMENTAL
SCHEDULE
|
NON-GAAP IMPACT OF
INCLUDING NORTH AMERICA
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
This supplemental
schedule provides adjusted Non-GAAP financial information and a
quantitative reconciliation of the difference between the Non-GAAP
financial measure and the financial measure calculated and reported
in accordance with GAAP. This supplemental schedule provides
a pro forma analysis of the Company's financial information had the
results of the North America business continued to have been
reported within continuing operations of the Company. We
believe that providing this analysis helps investors to better
understand the business results within the context of the
expectations and outlook previously provided by the Company.
|
|
TWELVE MONTHS
ENDED DECEMBER 31, 2015
|
|
|
|
|
|
|
|
Constant $
revenue
|
|
|
Revenue
% change
|
|
C$ revenue
%
change
|
|
Year-over-Year
Impact of
North
America
|
|
C$ revenue
%
change,
including
North
America
|
Total Avon
|
|
(19)%
|
|
2%
|
|
(2) pts
|
|
-%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Margin
|
|
|
Total Avon
|
|
2015
|
|
2014
|
|
Change
|
|
|
Reported
(GAAP)
|
|
2.7%
|
|
5.7%
|
|
(300) bps
|
|
|
Adjusted
(Non-GAAP)
|
|
5.7%
|
|
9.3%
|
|
(360) bps
|
|
|
Impacts
of:
|
|
|
|
|
|
|
|
|
2015 North America Adjusted
operating margin
|
|
(30) bps
|
|
-
|
|
|
|
|
2014 North America Adjusted
operating margin
|
|
-
|
|
(100) bps
|
|
|
|
|
Adjusted, including
North America
|
|
5.4%
|
|
8.3%
|
|
(290) bps
|
|
|
|
|
|
|
|
|
|
|
|
Note: Amounts
previously allocated from Global and other to North America have
been moved to Global and other for all periods presented, as these
represent costs associated with functions of the Company's
continuing operations.
|
|
|
|
|
|
|
|
|
|
Refer to the Non-GAAP
Financial Measures schedules for the reconciliation of the Adjusted
Non-GAAP financial measures.
|
Non-GAAP Financial Measures
To supplement our financial results presented in accordance with
generally accepted accounting principles in the United States ("GAAP"), we disclose
operating results that have been adjusted to exclude the impact of
changes due to the translation of foreign currencies into U.S.
dollars, including changes in: revenue, operating profit, Adjusted
operating profit, operating margin and Adjusted operating margin.
We also refer to these adjusted financial measures as Constant $
items, which are Non-GAAP financial measures. We believe these
measures provide investors an additional perspective on trends and
underlying business results. To exclude the impact of changes due
to the translation of foreign currencies into U.S. dollars, we
calculate current-year results and prior-year results at a constant
exchange rate. Foreign currency impact is determined as the
difference between actual growth rates and constant-currency growth
rates.
We also present gross margin, selling, general and
administrative expenses as a percentage of revenue, total and net
global expenses, operating profit, operating margin, net income,
diluted earnings per share and effective tax rate on a Non-GAAP
basis. We refer to these Non-GAAP financial measures as "Adjusted."
We have provided a quantitative reconciliation of the difference
between the Non-GAAP financial measures and the most directly
comparable financial measures calculated and reported in accordance
with GAAP. The Company uses the Non-GAAP financial measures to
evaluate its operating performance and believes that it is
meaningful for investors to be made aware of, on a period-to-period
basis, the impacts of 1) costs to implement ("CTI") restructuring
initiatives, 2) costs and charges related to the devaluations of
Venezuelan currency in February 2015
and March 2014 combined with being
designated as a highly inflationary economy ("Venezuelan special
items"), 3) the additional $46
million accrual recorded in the first quarter of 2014 for
the settlements related to the Foreign Corrupt Practices Act
investigations and the associated approximate $19 million net tax benefit recorded in the
fourth quarter of 2014 ("FCPA accrual"), 4) the settlement
charges associated with the U.S. pension plan ("Pension settlement
charge"), 5) the goodwill impairment charge related to the
Egypt business ("Asset impairment
and other charges"), 6) various other items associated with the
sale of Liz Earle, the sale of North
America and debt-related charges ("Other items") and 7) the
non-cash income tax adjustments associated with the Company's
deferred tax assets recorded in 2015 and 2014, and an income tax
benefit realized as a result of tax planning strategies ("Special
tax items"). The Company believes investors find the Non-GAAP
information helpful in understanding the ongoing performance of
operations separate from items that may have a disproportionate
positive or negative impact on the Company's financial results in
any particular period. These Non-GAAP measures should not be
considered in isolation, or as a substitute for, or superior
to, financial measures calculated in accordance with GAAP.
The Venezuelan special items include the impact on the
Consolidated Statements of Operations in 2015 and 2014 caused by
the devaluations of Venezuelan currency on monetary assets and
liabilities, such as cash, receivables and payables; deferred tax
assets and liabilities; and non-monetary assets, such as
inventories. For non-monetary assets, the Venezuelan special items
include the earnings impact caused by the difference between the
historical U.S. dollar cost of the assets at the previous exchange
rate and the revised exchange rate. In 2015 and 2014, the
Venezuelan special items also include adjustments of approximately
$11 million and approximately
$116 million, respectively, to
reflect certain non-monetary assets at their net realizable value.
In 2015, the Venezuelan special items also include an impairment
charge of approximately $90 million
to reflect the write-down of the long-lived assets to their
estimated fair value. In 2014, the devaluation was caused as a
result of moving from the official exchange rate of 6.30 to the
SICAD II exchange rate of approximately 50. In 2015, the
devaluation was caused as a result of moving from the SICAD II
exchange rate of approximately 50 to the SIMADI exchange rate of
approximately 170.
The Pension settlement charge includes the impact on the
Consolidated Statements of Operations in the third and fourth
quarters of 2015 and the second, third and fourth quarters of 2014
associated with the payments made to former employees who were
vested and participated in the U.S. defined benefit pension plan.
Such payments fully settle the Company's pension plan obligation to
those participants who elected to receive such payment.
The Asset impairment and other charges include the impact on the
Consolidated Statements of Operations caused by the goodwill
impairment charge related to the Egypt business in the fourth quarter of
2015.
The Other items include the impact during 2015 on the
Consolidated Statements of Operations due to the gain on the sale
of Liz Earle. The Other items also includes the impact on the
Consolidated Statements of Operations in the fourth quarter of 2015
caused by nonrecurring items of $3.1
million associated with the planned separation of
North America that were not
classified within discontinued operations. In addition, Other items
includes the impact on the Consolidated Statements of Operations in
the third quarter of 2015 of the loss on extinguishment of debt
caused by the make-whole premium and the write-off of debt issuance
costs and discounts associated with the prepayment of the Company's
2.375% Notes. The Other items also include the impact during the
second quarter of 2015 on other expense, net in the Consolidated
Statements of Operations of $2.5
million associated with the write-off of issuance costs
related to the Company's previous $1
billion revolving credit facility.
The Special tax items include the impact during 2015 on income
taxes in the Consolidated Statements of Operations due to a
non-cash income tax charge in the first quarter of 2015 and a
non-cash income tax benefit in the second quarter of 2015, each
associated with valuation allowances, to adjust the Company's U.S.
deferred tax assets to an amount that was "more likely than not" to
be realized. In the first quarter of 2015, the additional valuation
allowance was due to the continued strengthening of the U.S. dollar
against currencies of some of its key markets, and in the second
quarter of 2015, the Company released a portion of its valuation
allowance due to the weakening of the U.S. dollar against
currencies of some of its key markets. The Special tax items also
include the impact during the third quarter of 2015 on income taxes
in the Consolidated Statements of Operations due to a non-cash
income tax charge as a result of establishing a valuation allowance
for the full amount of the Company's U.S. deferred tax assets due
to the impact of the continued strengthening of the U.S. dollar
against currencies of some of its key markets and its associated
effect on the Company's tax planning strategies. Additionally, the
Special tax items includes the impact during the third quarter of
2015 on income taxes in the Consolidated Statements of Operations
due to a non-cash income tax charge associated with valuation
allowances, to adjust certain non-U.S. deferred tax assets to an
amount that is "more likely than not" to be realized. The non-U.S.
valuation allowance included an adjustment associated with
Russia, which was primarily the
result of lower earnings, which were significantly impacted by
foreign exchange losses on working capital balances. The Special
tax items also include the impact during the fourth quarter of 2014
on the income taxes in the Consolidated Statements of Operations
due to a non-cash income tax charge primarily associated with a
valuation allowance to reduce the Company's U.S. deferred tax
assets to an amount that is "more likely than not" to be realized,
and was primarily due to the strengthening of the U.S. dollar
against currencies of some of its key markets and, to a lesser
extent, the finalization of the FCPA settlements. The Special tax
items also include the impact during the fourth quarter of 2015 on
the income taxes in the Consolidated Statements of Operations due
to an income tax benefit realized as a result of the implementation
of foreign tax planning strategies.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/avon-reports-fourth-quarter-and-full-year-2015-results-300218731.html
SOURCE Avon Products, Inc.