NEW YORK — Avon Products Inc. reaffirmed its third-quarter and full-year earnings projections Tuesday and also provided quarterly sales guidance.
For the third quarter ending Sept. 30, the New York-based direct marketing giant said earnings per share should be 53 to 54 cents, which is consistent with the forecast provided July 23 and includes expenses of more than $6 million, or about 1.5 cents a share, for the redemption of a convertible bond. In last year’s third quarter Avon had EPS of 38 cents, which included an aftertax charge of $25.2 million, or 10 cents, for reorganization costs.
Sales in the third quarter are anticipated to grow approximately 12 percent to more than $1.6 billion on the strength of beauty products, as well as a double-digit increase in the number of active representatives and a mid-single-digit rise in unit volume. Quarterly results are expected to be reported on Oct. 28.
“We’re very pleased with how the third quarter is shaping up, and we believe that this will be Avon’s strongest quarter of sales growth since the fourth quarter of 1994,” said chief executive officer Andrea Jung in a statement. “The U.S., our largest market, is returning to healthy mid-single-digit sales growth, and we’re also benefiting from favorable currency tailwinds in key markets.”
For the full fiscal year, Avon said EPS remains on pace to hit the firm’s previous target of $2.60 to $2.65, assuming foreign currencies remain at or near current trading levels. Last year, the company reported full-year EPS of $2.32.
— Dan Burrows
In Defense of Colorants
PARIS — France’s monthly consumer magazine, 60 Millions de Consommateurs, published a feature in its September issue maintaining that some hair colorants not only present an allergy risk, but are also suspected of bringing on cancer. In response, the French Federation des Industries de la Parfumerie swiftly issued a statement entitled “Hair Coloring — a Responsible Industry and Safe Products.” Among its assertions, the Federation states hair coloring has long been the object of numerous studies, yet “none has established the existence of a major health risk for consumers.”
— Jennifer Weil