"We are pleased with our strong performance again this quarter as our turnaround continues to gain traction," said Andrea Jung, chairman and CEO, Avon. "We are investing at significant levels in both advertising and the Representative Value Proposition. Clearly these growth investments are paying back. We were particularly pleased that revenue increased over 30% in five of our key growth markets."
Sales of beauty products recorded double-digit growth for a fourth consecutive quarter, increasing 14% (8% in local currency), powered by growth in all categories: fragrance up 21%, personal care up 19%, color cosmetics up 16% and skin care up 4%.
The company said that second-quarter 2007 operating profit of $187 million was 17% lower than 2006's $225 million due to the increased investments in advertising and the Representative Value Proposition, as well as costs associated with its Product Line Simplification program.
The company further stepped up the pace of its share repurchases during the second quarter, buying approximately $280 million of stock, to bring repurchases for the first six months of 2007 to $410 million, and total program purchases to $758 million of the current $1 billion authorization.