Avon Sees Restructure Costs at High End

Avon Products Inc., said that the cost to implement its four-part turnaround plan would be at the high end of a previously announced range of $300 million to $500 million. The company expects restructuring costs for all initiatives to total about $50 million, with implementation continuing over the next three years. Avon also said it expects annual savings to surpassing $300 million once the restructuring’s completed. Avon also backed its forecast calling flat to slightly higher revenue for 2006, and expects revenue growth as measured in local currencies that will average in the mid-single digits after 2006. Beyond the transition of 2006, the company said it will try to contain overhead expenses in line with or below the prior year’s level to boost income and allow reinvestment in the company’s business. Earlier this month, the company posted a 37% drop in fourth-quarter profit, pinched by restructuring costs and lower selling prices.