Tag Archive for Avon

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Avon Having Trouble Getting Rid Of North American Business, Sales Plummet

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Avon shares slid by more than 7% on Tuesday to around $7.53 a share.
Last month, the stock surged by more than 15% after the Wall Street Journal reported that it is exploring “strategic alternatives” for its North American business, meaning the company is looking for ways to improve its competitiveness.
The initial report from WSJ said the company is looking to sell some or all of this unit. But according to a New York Post story published late Tuesday, this process isn’t going very well.
The Post reported that companies interested in buying out Avon are losing interest because they are struggling to finance an offer.

The Post quotes one hedge fund investor as saying: “All in all, I don’t see a deal happening unless Avon basically gives away its North America business for essentially nothing.”

Avon also reported weak first-quarter results last

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Avon Sales Fall From $3 Billion To $1.2 Billion In Less Than 5 Years

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In less than 5 years, Avon has lost nearly half of its revenue, fallen off of the S&P 500, left the DSA, and lost 40% of the value of its stock. One has to wonder what other direct-selling companies can learn from this. In an article in the Wall Street Journal, they explore the reasons why: 
Everyone seems to know who the Avon lady is—except for Avon.
The company is struggling with its identity. It remains heavily entrenched in the U.S., even though most of its business is abroad. It is one of the biggest direct sellers of beauty products and relies heavily on personal relationships, but it lagged behind in developing an online strategy and hasn’t capitalized on the opportunities of social media. And while its focus is beauty, its representatives are busy

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Avon Looking To Sell North American Business

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Avon Products has postponed its analyst day, and reports say the company is exploring strategic alternatives. Yahoo Finance has reported that Avon is looking to sell its North American business. This comes after a long downhill slope in sales and business and a difficult 2014 news wise after leaving the DSA. 
Wall Street Journal also reports: 
Avon Products Inc. is exploring options including a sale of the company or its struggling North American business, people familiar with the matter said, an acknowledgment that its problems are more than skin deep. 
The door-to-door beauty company, with $8.9 billion in annual sales and more than a century of history, has tried without success for years to repair weak financial results and stem an exodus from its ranks of sales representatives.
Chief Executive Sherilyn McCoy was to outline her latest plans for a

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Does Avon And Mary Kay Test On Animals?

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According to Snopes.com – the answer isn’t a clear yes or no: 
Animal Testing Resumes For Avon, Mary Kay, And Estee Lauder. Someone has posted this on Facebook and some are claiming it isn’t true. Can you verify this?
  
Origins:   In March 2015, a rumor claiming that cosmetic companies Avon, Mary Kay, and Estee Lauder had resumed animal testing started circulating again on social media sites, stemming from an article published by the Dog Files web site in 2012:
Animal testing for cosmetics is a hot topic in the beauty industry, with most consumers and many companies deciding to avoid products made with animal testing. After more than two decades following a no testing on animals policy, cosmetics giants Avon, Mary Kay, and Estee Lauder have resumed the practice without letting consumers know. 
According to a press release from Rush

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Damaging Blow: Avon Falls Off S&P 500 For First Time Since 1964

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After a more than fifty-year stay in the index, Avon won’t be in it for much longer.
S&P Dow Jones Indices, the company that manages the S&P 500, announced on Friday that the troubled cosmetics giant will be moved to its MidCap 400 index after the close of trading on March 20.
The S&P 500, which many average and professional investors use as their main benchmark to judge stock market performance, is home to mostly larger companies.
Avon (AVP) is now worth only $3.2 billion. It’s being replaced by underwear and T-shirt makerHanesbrands (HBI), which has a market value of more than $13 billion.
In its statement, S&P Dow Jones Indices said the change was made because Avon was no longer big enough.
A spokesman for S&P Dow Jones Indices added that Avon has been in the S&P 500 since

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Avon Hires New CFO; Former J. Crew COO

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Avon Products Inc. said Wednesday it hired James Scully away from J. Crew Group Inc. to be its new chief financial officer.
Mr. Scully has been J. Crew’s chief operating officer for nearly two years and with the retailer for a decade. His exit follows the departure of Stuart Haselden, its chief financial officer, earlier this month. Mr. Haselden left to join Lululemon Athletica Inc. as its CFO.
J. Crew is contending with falling shopper traffic at its stores and the retailer recently wrote down the value of its stores by more than half a billion dollars, while leaving its online operations unscathed, an indication of the toll that e-commerce is taking on brick-and-mortar retailing.

“Jim’s departure comes at a time when we are looking at the way our team and business is structured,” a company spokeswoman said in a statement. “Retail has been evolving quickly and we want to ensure we are set up for ’the new world’ as we move forward.”

The spokeswoman said J. Crew had already hired an executive search firm to look for Mr. Scully’s successor. Joan Durkin, its chief accounting officer, will temporarily fill the role of CFO, while it looks for a permanent replacement.
Avon said Mr. Scully, 49, will join the beauty products

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Avon Finally Sees A Rise After Rumors Of Buyout

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TheStreet.com reports: 
Shares of Avon Products rose 1.25% to $8.08 in morning trading Monday on continued speculation that the beauty products manufacturer could be the target of a buyout.
Dealreporter reported late last week that Avon was in talks with private equity firm TPG Capital about a potential buyout. Dealreporter cited three unidentified sources but said it was unclear how far along the two sides had progressed in the talks or if Avon had hired any advisory firms.
Bloomberg published a report Friday to say that Avon is the cheapest personal-goods company a buyout firm could find right now.
More than 8.5 million shares had changed hands as of 11:01 a.m., compared to the daily average volume of 11,485,400.
Separately, TheStreet Ratings team rates AVON PRODUCTS as a “sell” with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

“We rate AVON PRODUCTS (AVP) a SELL. This is driven by several weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company’s weaknesses can be seen in multiple areas, such as its generally high debt management risk, disappointing return on equity and generally disappointing historical performance in

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Avon In Possible Deal Talks For A Takeover; Reports Bloomberg

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Bloomberg Reports : Avon Products Inc. (AVP), the world’s largest seller of door-to-door cosmetics, jumped the most in almost two years after Dealreporter said the company has held talks with private equity firm TPG Capital about a possible transaction.
The report sent the shares up 15 percent to $8.66 in New York, the biggest one-day increase since February 2013. The stock declined 45 percent last year.
Avon is seen as a candidate for a leveraged buyout because it has strong cash flow, Dealreporter said, even though sales have been slumping in recent years. The takeover speculation follows the end of a six-year U.S. investigation into whether Avon’s Chinese subsidiary bribed local officials. The company pleaded guilty last month and agreed to adopt internal controls and pay $135 million in fines.
It isn’t clear if the TPG talks have advanced or whether Avon has hired advisers to consider a deal, said Dealreporter, which cited three unidentified people within the industry.
Owen Blicksilver, a spokesman for TPG, declined to comment to Bloomberg News, as did Lindsay Fox, a spokeswoman for New York-based Avon.
Avon joins Elizabeth Arden Inc., another beauty company, in spurring takeover talk. Elizabeth Arden, maker of Elizabeth Taylor and Britney Spears brand perfumes, hired Goldman Sachs Group Inc. last

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Avon Lays Off Workers – Estimated Up To 600

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The trend for Avon is still in a rapidly growing downward spiral. Avon Canada said Monday that it will eliminate most jobs at its distribution centre in Pointe-Claire.
Company spokeswoman Elizabeth Munro declined to specify the number of positions cut. She said that the company would make no statement beyond the press release issued in late afternoon.
A source told the Montreal Gazette that Avon employees were told Monday that most jobs would be gone by April while some jobs would remain until July to allow for training of new personnel. The source, who did not want to be identified, said about 600 jobs would disappear at the Pointe-Claire facility.
Munro said the 600 jobs figure was “way inflated,” but would not provide further details about job losses or how the process would roll out.
The firm said it will outsource the jobs to Genco, a privately-held U.S.-based company that describes itself as a leading “product lifecycle and reverse logistics” solutions provider.
Avon’s announcement made it clear that the Genco jobs will not be permanent. The new jobs under Genco, it appears, will be temporary and respond to demand in any given two-week cycle.
Genco “can support Avon’s supply chain needs by expanding and contracting to meet the

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Avon’s Downtrend Continues And Hits 52 Week Low

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Share price of Avon Products Inc.  has been witnessing a downtrend for about over a year as the company has lost its luster due to continuous loss of active representatives, declining volume, unfavorable foreign currency translations and reduced margins in mature markets like North America. Consequently, shares of this New York-based global beauty company hit a new 52-week low of $8.54 yesterday, before closing trade at $8.61. Moreover, the stock has tumbled about 49.6% year over year.
The aforementioned factors have led Avon to produce distressed operating results over the past few quarters. Further, weakness in the emerging markets as well as regulatory and cash flow issues risking dividend are the other negatives.
Additionally, over the last four years, Avon has witnessed a declining revenue trend in North America, especially in the U.S., mainly due to a decrease in active representatives, partly offset by large average order. Total revenue from this region has declined considerably from about $2,293.4 million in 2009 to nearly $1,458.2 million in 2013. Further, revenues from this region have also declined so far in fiscal 2014, reporting an 8% fall in the third quarter. The company’s management is concerned about the decline in revenues and has been constantly striving to

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