Avon Products Inc. (NYSE: AVP) said Thursday having 10 percent more people selling its products during the third quarter helped sales, according to Associated Press.
Best Damn Penny Stocks, a leading financial publication, is pleased to alert investors of stocks on the move. Sign Up for our Free Stock Newsletter
However, the stronger dollar hurt its revenue from some markets, and its profit fell 30 percent.
The cosmetics, gift and home products company earned $156.2 million, or 36 cents per share, for the period ended Sept. 30. That's down from $222.6 million, or 52 cents per share, a year earlier.
Avon is in the midst of a restructuring that includes cutting jobs and trimming overhead.
Excluding costs related to those cuts, its profit was 42 cents per share, better than the 40 cents per share analysts polled by Thomson Reuters were expecting. Analysts typically exclude one-time costs such as restructuring.
However, Avon's shares fell 4 percent as its North American results remained sluggish.
Avon, which sells brands including Skin-So-Soft and Mark along with its namesake cosmetics, added thousands more sales people in the U.S. and abroad, who are not employees, as workers everywhere seek new sources of income during the recession.
The company focused on recruiting sellers, whom it calls "active representatives," as well as broadening its assortment of less-expensive products, including products under $5, to drive sales. But it is cutting its in-house staff by more than a thousand.
Growth remains strongest in emerging markets, he said. In Brazil, Avon's largest market, its sales force grew 13 percent and sales rose 22 percent, excluding the effect of the stronger dollar. Astrachan predicted Avon's sales will keep growing by double digits in Brazil.
Avon recorded its 10th consecutive quarter of double-digit revenue growth in Latin America, excluding the dollar's effect.
Results were weaker in North America, where sales fell 8 percent. CFO Charles Cramb said the weakness was due to low demand for fashion and home items, which cost more than beauty products.
Avon's sales fell 4 percent, from $2.64 billion to $2.55 billion this quarter. The stronger dollar pulled down revenue 11 percentage points, as overseas sales converted back to fewer U.S. dollars. That impact could lessen because the dollar has been weakening in the fourth quarter.
CFO Cramb predicted the weaker dollar would help fourth-quarter sales in the mid-single-digit percentage range compared with a year earlier.
Shares fell 55 cents, or 1.7 percent, to $32.45 during afternoon trading. The stock has traded between $14.40 and $35.82 over the past year.
Sign up for the free Best Damn Penny Stocks newsletter. To subscribe, enter your e-mail address into the frame at the bottom of this press release or visit our website
About Us
Best Damn Penny Stocks is a leading stock web site that allows investors and interested parties to research stocks that are on the move. We also track small cap companies that are on the brink of a financial breakout. To feature a company on our web site please contact us at the email listed below.
Please click here to read the full disclaimer
