first-quarter earnings rose a better-than-expected 16% from a year ago, as strong overseas results offset a 15% decline in U.S. operating profit. The company guided full-year results in line with estimates.
The makeup company earned $172.0 million, or 36 cents a share, in the quarter, compared with earnings of $148.1 million, or 31 cents a share, last year. Revenue rose 7% from a year ago to $1.88 billion. Analysts had been forecasting earnings of 35 cents a share on revenue of $1.90 billion.
For all of 2005, Avon expects to earn $2.12 to $2.17 a share, reflecting a gain of 17 cents a share related to tax settlements. Before the gain, analysts were forecasting earnings of $1.99 a share.
In the second quarter, Avon expects to earn 66 cents a share, including the 17-cent gain. Before the gain, analysts had been forecasting earnings of 52 cents a share, according to Thomson First Call.
By region in the first quarter, U.S. revenue fell 6% from a year ago while U.S. operating profit fell 15%. The results reflected a 10% decline in beauty sales, which reflected tough comparisons and a product repositioning. In Europe, first-quarter revenue rose 17% from a year ago, while operating profit rose 26%.
In Latin America, first-quarter revenue rose 10%, or 8% in local currency, reflecting strong growth in Brazil and Venezuela. In Asia Pacific, revenue rose 10% from a year ago, or 8% in local currency.
"Continuing strong results in our international regions are offsetting U.S. performance during this period of repositioning, with our emerging markets once again expected to deliver another full year of stand-out revenue growth," Avon said.