Avon Profit Falls Short As Currency, Economic Weakness Weighs

Avon Products Inc. shares slid about 3% in premarket trade Wednesday, after the company reported weaker-than-expected profit for the third quarter and lowered its outlook for the full year. Avon said it had a net loss of $697 million, or $1.58 a share, after net income of $92 million, or 21 cents a share, in the year-earlier period. Adjusted loss per share came to 11 cents, compared with a FactSet consensus for EPS of 7 cents a share. Revenue fell 22% to $1.70 billion, slightly ahead of the FactSet consensus of $1.68 billion. "This was a difficult quarter impacted by currency and other macro pressures, and our financial results were not where we would like them to be," Chief Executive Sheri McCoy said in a statement. She said active representatives fell 1%, led by a decline in North America and Latin America, which offset growth in Russia and Brazil. Avon said it now expects currencies to shave 19 points off full-year revenue, expects a 100 basis-point decline in constant dollar adjusted operating margin and a 300 basis-point decline in adjusted operating margin. Shares are down 54% in the year so far, while the S&P 500 has gained 2.4%.