Reuters

(Reuters)

Dollar to Dent Avon Revenue More than Expected

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Avon Products Inc, a direct seller of cosmetics and personal care products, reported a lower-than-expected quarterly adjusted profit and said a strong dollar would hurt full-year revenue more than it had expected.

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The company, which gets more than 80 percent of its revenue from outside the United States, said the strong dollar is now expected to hurt 2015 revenue by about 17 percentage points, up from its previous forecast of a 12 percentage point impact.

Chief Executive Sheri McCoy has been struggling to turn around Avon as it loses representatives - the so-called "Avon Ladies" - in the United States and grapples with weak demand in Brazil.

Avon's total revenue declined 17.8 percent to $1.79 billion in the first quarter, hurt by a strong dollar and weak demand in Latin America, which accounted for about 47 percent of total revenue.

Revenue fell 17 percent in Brazil and fell 12 percent in Mexico, Avon said, pulling down revenue from Latin America by 22 percent.

On a constant currency basis, revenue rose 1 percent. The dollar hurt reported revenue by 19 percentage points in the quarter.

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The net loss attributable to Avon decreased to $147.3 million, or 33 cents per share, in the three months ended March 31, from $168.3 million, or 38 cents per share, a year earlier.

Excluding items, Avon earned 4 cents per share.

Analysts on average had expected a profit of 7 cents per share on total revenue of $1.83 billion, according to Thomson Reuters I/B/E/S.

Avon's shares fell about 0.6 percent to $8.62 in premarket trading on Thursday. Up to Wednesday's close, the stock had lost about 43 percent of its value in the past 12 months. (Reporting by Shailaja Sharma in Bengaluru; Editing by Savio D'Souza)