Revenue for the second quarter fell to $1.82bn, but increased by 1% in constant currency terms, reflecting the huge impact that the strong US dollar had on the final outcome.
However, the revenues did manage to beat expectations, with a cross section of analysts interviewed by Thomson Reuters expecting revenues to come in at approximately $1.80bn.
Underlying growth
At constant dollar rates, several markets did see growth during the quarter, including Europe, the Middle East and Africa as a whole; and several countries in Latin America. The company did also point out that these gains were counterbalanced by a poorer performance in North America.
Net income for the period did rise, up from $20m last year to $30m this year, gains that came from cost cutting measures mainly from the exit of several international businesses.
But on an adjusted basis net income was $48m, compared to $91m last year, which reflected costs associated with restructuring as well as a significant hit associated with the Venezuela currency revaluation that occurred in mid-February.
Big regional differences
The company’s results continue to see big regional differences, with underlying results showing the biggest weakness is still in the North America market.
Revenues during the quarter came in at $258.6m in North America, which represented a fall of 15% on the same period last year.
Elsewhere, underlying results were strong in Europe, where adjusted sales were up 6% to $552.9m, but down 16% when factoring in currency exchange rates.
In Latin America sales were up 3% at constant rates to $853.6m, but down 19% on a adjusted basis, while in Asia sales were down 4% to $158.4m and down 8% on an adjusted basis.
Moves toward greater financial flexibility
"Our overall second-quarter performance was in line with our expectations in an environment of extraordinary currency pressure. Market by market, our local teams are operating effectively as they address consumer demands, improve Representative engagement and manage cost," said Sheri McCoy, CEO of Avon Products.
"In addition, given that we anticipate the challenging environment to continue, we have taken steps to improve our financial flexibility," she added.
Those moves include a new five-year $400m revolving credit facility, while it has also terminated its previous $1bn unsecured credit facility. On top of that, it also sold off its Liz Earle beauty business in the second quarter, adding a further $215m that will be used to pay existing debts.