Avon Will Take 3Q Charge

Avon Products Inc. said yesterday that special items in its third quarter related to restructuring will result in a $25.2 million after-tax charge. Avon will take a charge of $30.4 million after tax, or 12 cents a share, in line with its Sept. 3 estimate. It will also record a gain of $5.2 million after tax, or 2 cents a share, from an adjustment to a similar restructuring charge taken in the fourth quarter of 2001.

The net effect of the two unusual items in the third quarter is the charge of $25.2 million after tax, or 10 cents a share. The company also backed its earlier guidance for earnings of $2.30 a share for all of 2002, excluding unusual items, despite further currency weakness in Brazil.

Avon expects to post net savings of about $15 million pretax in 2003, accelerating to $40-$50 million in 2004, from actions related to the third-quarter charge.