Colgate, Avon grow despite North American slump
By Jessica Wohl
CHICAGO (Reuters) - Colgate-Palmolive Co <CL.N> and Avon Products Inc <AVP.N> showed on Thursday that a big international presence is key, as growth in Latin America, the largest market for both U.S. companies, offset slumps at home.
Sales at Colgate, best known for its namesake toothpaste, rose 17 percent in Latin America and fell 3 percent in North America.
At Avon, the world's largest direct seller of cosmetics, revenue rose 19 percent in Latin America and fell 7 percent in North America.
Two years after the recession officially ended, U.S. shoppers are still pausing before spending more on items from updated toothpastes to the latest lipsticks as food and gasoline prices have risen.
So household product makers including Colgate and Avon, both based in New York, have steadily been working on the international businesses that make up the bulk of their sales.
The North American market is only worth roughly 18 percent of sales at both Avon and Colgate, excluding the latter company's Hill's pet food unit. Latin America, meanwhile, accounts for 47.2 percent of Avon's revenue and 29 percent of Colgate's sales.
Colgate earned $622 million, or $1.26 per share, in the second quarter, up from $603 million, or $1.17 per share, a year earlier. Sales rose 9.7 percent to $4.19 billion.
Analysts on average expected a profit of $1.25 per share on $4.18 billion in sales, according to Thomson Reuters I/B/E/S.
Avon earned $206.2 million, or 47 cents per share, up from $167.6 million, or 39 cents per share, a year earlier. Excluding the impact of restructuring costs, earnings were 49 cents per share.
Revenue rose 9 percent to $2.86 billion.
Analysts had expected Avon to earn 50 cents per share on $2.89 billion in revenue.
(Reporting by Jessica Wohl, editing by Maureen Bavdek and Lisa Von Ahn)