Breaking News

Venezuela Takes Its Toll on FMCG Companies

March 7, 2014

Avon, P&G and others note the drag on 2013 results.

The seven largest consumer and household goods companies operating in Venezuela, including Kimberly-Clark Corp., Avon Products and Newell Rubbermaid Inc., had the equivalent of $3.7 billion trapped in the country at the end of last year, calculated at the official rate of 6.3 bolivars per dollar, according to their annual and quarterly filings. Avon derives 5% of its profits from the country.

“Earnings revisions from Venezuela are likely to be negative rather than positive,” BMO Capital Markets consumer analyst Connie Maneaty said. “Worse still, the Sicad rate is floating and may devalue more.”

P&G and Colgate-Palmolive last month said that using a weaker, secondary rate would cut their assets by as much as $280 million and $200 million, respectively.

“Companies are assuming they won’t receive any more money at the official rate,” Luis Andueza, administrative law partner at legal firm Norton Rose Fulbright told Bloomberg. “They are taking loses by adopting conservative accounting to calm the markets worried by negative news in Venezuela.”

 

blog comments powered by Disqus
  • Cosmetic Chemists Head to Orlando Next Month

    Cosmetic Chemists Head to Orlando Next Month

    September 26, 2016
    Organizing Chair Guy Padulo explains why you should attend the IFSCC Congress.

  • Restoring Rembrandt

    Restoring Rembrandt

    Christine Esposito, Associate Editor||September 26, 2016
    Ranir LLC has acquired Rembrandt, an iconic name in teeth whitening, and plans to make it a staple in the value segment.

  • Active Agents

    Active Agents

    September 19, 2016
    On the surface, surfactants may seem staid, but the market, and the supplier activity driving it, is bubbling.

  • Back to School

    Back to School

    Tom Branna, Editorial Director||September 1, 2016
    It may be September, but class was in session this summer during the Private Label Manufacturers Association’s Executive Educ

  • How Green Is Your Surfactant?

    How Green Is Your Surfactant?

    Tom Branna, Editorial Director ||September 1, 2016
    Suppliers offer a range of solutions to help household and personal care product formulators develop formulas

  • What

    What's In Your Formula?

    Christine Esposito, Associate Editor||September 1, 2016
    A look at the ingredients beauty brands are using to fuel their formulations and capture consumers’ attention.