The Net Works

Second Quarter Looking Good at Avon

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By: TOM BRANNA

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Avon Products, Inc. reported that second-quarter total revenue grew 17% to $2.7 billion. Sales of beauty products rose 19%. Active representatives increased 7%, and units sold were up 5% versus the prior-year quarter. According to the company, all six operating regions contributed to the growth in each of these measures.

Operating profit doubled to $374 million, while net income leaped 60% to $236 million. The company’s 19% growth in beauty sales included increases in all categories: color was up 26%, fragrance grew 17%, skin care increased 15% and personal care rose 17%.

Beauty sales benefited in part from a 10% increase in advertising expenditures to $103 million, according to the company. Advertising supported the launch of new products as well as representative recruitment in priority markets. For the six months ended June 30, 2008, net sales rose 16% to $5.2 million, while net income jumped 60% to $420.3 million.

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