Avon Products, Inc. reported fourth-quarter and full-year 2012 results. "2012 was a challenging year for Avon, but I'm encouraged to see that the overall business is showing early signs of stabilization," said Sheri McCoy, Avon’s CEO. "We have a lot of work ahead of us, but I am confident that in 2013, we will see progress against our three-year financial goals."
For the fourth quarter, total revenue of $3 billion decreased 1%, but increased 1% in constant dollars. Total units grew 2% and price/mix decreased 1% during the quarter. Active representatives were up 1%. Avon Beauty sales declined 2%, or increased 1% in constant dollars. On a reported basis, fragrance was flat, color and personal care both declined 1% and skin care declined 5%. On a constant-dollar basis, fragrance and color both increased 2%, personal care increased 1%, and skin care declined 2%.
For full year 2012, total revenue of $10.7 billion decreased 5%, or was flat in constant dollars. Total beauty sales declined 5%, or increased 1% on a constant-dollar basis. Active representatives declined 1% and units sold were flat.
For Latin America, fourth quarter 2012 saw revenue of $1.3 billion, while the full-year 2012 revenue came in at $4.9 billion. Fourth-quarter constant-dollar revenue increased, primarily due to an increase in active representatives, and units sold increased 6%, primarily attributable to Brazil. Brazil revenue was down 3%, or up 10% in constant dollars, primarily due to an increase in active representatives, and Mexico revenue was up 9%, or 4% in constant dollars, driven primarily by an increase in active representatives partially offset by a decline in average order. Venezuela revenue was up 2% in both reported and constant dollars, as average order benefited from the inflationary impact on pricing, but was partially offset by a decrease in active representatives.
For Europe, the Middle East and Africa, revenue for the fourth quarter was $905.8 million, while overall revenue for 2012 was $2.9 billion. Fourth-quarter constant-dollar revenue increased primarily due to an increase in active representatives and unit growth, and revenue in Russia was up 3% in both reported and constant dollars, primarily due to higher average order and an increase in active representatives. Revenue in the U.K. was flat, or down 2% in constant dollars, primarily due to a decrease in active representatives, partially offset by higher average order, while revenue in Turkey was up 1%, or down 1% in constant dollars, primarily due to lower average order, partially offset by growth in active representatives. Revenue in South Africa was flat, or up 8% in constant dollars, primarily due to growth in average order, partially offset by a decrease in active representatives.
For North America, fourth quarter revenue was $516 million, while full-year 2012 revenue came in at $1.9 billion. Fourth-quarter North America revenue declined 12%, primarily due to a decrease in active representatives. The North America Avon business revenue declined 11%, primarily due to a decrease in active representatives, partially offset by higher average order.
For Asia Pacific, fourth quarter revenue was $246 million, and full-year 2012 revenue was $902 million. Fourth-quarter constant-dollar revenue decreased primarily due to continued weakness in China. Revenue in China declined 23%, or 24% in constant dollars, primarily as a result of a decline in units sold. In this market, Avon will continue to focus on independently owned retail locations (beauty boutiques). Revenue in the Philippines grew 7%, or 2% in constant dollars, primarily due to growth in active representatives and higher average order, due to an increase in fashion and home sales.
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