Avon Products (AVP) Misses Q4 EPS by 7c

Avon Products (NYSE: AVP) reported Q4 EPS of $0.20, $0.07 worse than the analyst estimate of $0.27. Revenue for the quarter came in at $2.3 billion versus the consensus estimate of $2.43 billion.

"While progress against our financial goals in 2014 was slower than I would have liked, I am pleased with the sequential improvements we made in several key markets and categories in the second half of the year. We have stronger management teams across our key markets and better discipline in executing consistently against Avon's core processes," said Sheri McCoy, Chief Executive Officer of Avon Products, Inc. "Going into 2015, we intend to build on that momentum. However, based on strengthening of the U.S. dollar, we expect the impact of foreign currency on our reported results to be significant. We are working to mitigate as much of the impact as possible. Avon has weathered emerging market cycles in the past and I'm confident we will do so again."

Full-Year 2015 Outlook

In 2015, the Company expects to continue to make progress against its strategic objectives. Constant-dollar revenue is expected to be up modestly; however, assuming January foreign currency spot rates, reported revenue is expected to decline due to an estimated 12 point negative impact from foreign currency translation. The Company also expects foreign currency transaction costs and translation adjustments to have a significant negative impact on Adjusted operating profit. The Company expects Constant-dollar Adjusted operating margin to be up modestly as it plans to offset most of the foreign currency transaction impact with price increases and further actions to reduce costs. However, due to foreign currency translation, the Company expects that Adjusted operating margin could be down as much as 1 point in reported dollars.

The potential impact from a pending tax law change on cosmetics in Brazil, called Industrial Production Tax (IPI), has not been factored into the Company's outlook at this time. The Company is presently assessing ways to mitigate the potential impact.

For earnings history and earnings-related data on Avon Products (AVP) click here.

You May Also Be Interested In

• American Express (AXP) down despite beating Q1 estimates on top and bottom lines
• Wipro (WIT) Tops Q1 EPS by 1c
• Fifth Third Bancorp (FITB) Tops Q1 EPS by 2c