Avon Posts Higher 1Q Profit

2007-05-01 | 02:31

Gains driven by strong sales in China and Russia

Avon Products Inc., the world's largest direct seller of cosmetics, on Tuesday reported better-than-expected first-quarter profits, boosted by strong sales in China and Russia.

The company earned $150 million, or 34 cents a share in the first quarter that ended March 31, compared with $56.2 million, or 12 cents.

Analysts, on average, expected it to earn 28 cents a share, according to Reuters Estimates.

Quarterly revenue rose 9 percent to $2.2 billion.

Sales in China grew 44 percent. In Central and Eastern Europe sales increased 17 percent, helped by strong sales in perfumes and color cosmetics, and a 30-percent revenue growth in Russia.

Avon is in the middle of a multiyear restructuring that includes cutting jobs, focusing on fewer products and weeding out less profitable goods.

The company, which had previously announced plans to expand its celebrity perfume line, said last week that it will join with French fashion designer Christian Lacroix and Inter Parfums Inc. to create two new perfumes that will be launched this year.

Christian Lacroix Rouge for women will be in U.S. markets by November -- in time for the holiday season -- while Christian Lacroix Noir for men will debut in February.