Avon 2014 Annual Report Download - page 41

Results Of Operations – Consolidated
Years ended December 31 %/Point Change
2014 2013 2012
2014 vs.
2013
2013 vs.
2012
Total revenue $8,851.4 $9,955.0 $10,561.4 (11)% (6)%
Cost of sales 3,499.3 3,772.5 4,103.1 (7)% (8)%
Selling, general and administrative expenses 4,952.0 5,713.2 5,889.3 (13)% (3)%
Impairment of goodwill and intangible assets – 42.1 44.0 * (4)%
Operating profit 400.1 427.2 525.0 (6)% (19)%
Interest expense 111.1 120.6 104.3 (8)% 16%
Loss on extinguishment of debt – 86.0 – * *
Interest income (14.8) (25.9) (15.1) (43)% 72%
Other expense, net 139.6 83.9 7.1 66% *
(Loss) income from continuing operations, net of tax (384.9) (1.0) 93.3 * *
Net loss attributable to Avon $ (388.6) $ (56.4) $ (42.5) * (33)%
Diluted (loss) earnings per share from continuing
operations $ (.88) $ (.01) $ .20 * *
Diluted loss per share attributable to Avon $ (.88) $ (.13) $ (.10) * (30)%
Advertising expenses(1) $ 177.1 $ 201.9 $ 251.3 (12)% (20)%
Gross margin 60.5% 62.1% 61.2% (1.6) .9
CTI restructuring – – – – –
Venezuelan special items 1.4 .4 – 1.0 .4
Adjusted gross margin 61.8% 62.5% 61.2% (.7) 1.3
Selling, general and administrative expenses as a % of
total revenue 55.9% 57.4% 55.8% (1.5) 1.6
CTI restructuring (1.3) (.7) (1.1) (.6) .4
Venezuelan special items (.2) (.1) – (.1) (.1)
FCPA accrual (.5) (.9) – .4 (.9)
Pension settlement charge (.4) – – (.4) –
Asset impairment and other charges – (1.2) – 1.2 (1.2)
Adjusted selling, general and administrative expenses
as a % of total revenue 53.5% 54.6% 54.6% (1.1) –
Operating profit $ 400.1 $ 427.2 $ 525.0 (6)% (19)%
CTI restructuring 114.2 65.9 124.7
Venezuelan special items 137.1 49.6 –
FCPA accrual 46.0 89.0 –
Pension settlement charge 36.4 – –
Asset impairment and other charges – 159.3 44.0
Adjusted operating profit $ 733.8 $ 791.0 $ 693.7 (7)% 14%
Operating margin 4.5% 4.3% 5.0% .2 (.7)
CTI restructuring 1.3 .7 1.2 .6 (.5)
Venezuelan special items 1.5 .5 – 1.0 .5
FCPA accrual .5 .9 – (.4) .9
Pension settlement charge .4 – – .4 –
Asset impairment and other charges – 1.6 .4 (1.6) 1.2
Adjusted operating margin 8.3% 7.9% 6.6% .4 1.3
Change in Constant $ Adjusted operating margin(2) 1.1 1.5
Effective tax rate 334.4% 100.6% 78.2% 233.8 22.4
CTI restructuring (3.0) .8 (.4) (3.8) 1.2
Venezuelan special items (43.8) (27.1) .1 (16.7) (27.2)
FCPA accrual (.3) (6.2) – 5.9 (6.2)
Pension settlement charge (.7) – – (.7) –
Asset impairment and other charges – (39.0) (3.6) 39.0 (35.4)
Loss on extinguishment of debt – 1.2 – (1.2) 1.2
Special tax items (246.6) – (39.3) (246.6) 39.3
Adjusted effective tax rate 39.9% 30.3% 35.0% 9.6 (4.7)
Change in Active Representatives (5)% (2)%
Change in units sold (5)% (5)%
Amounts in the table above may not necessarily sum due to rounding.
* Calculation not meaningful
(1) Advertising expenses are included within selling, general and administrative expenses.
(2) Change in Constant $ Adjusted operating margin for all years presented is calculated using the current-year Constant $ rates.
A V O N 2014 33