For the fourth Quarter of 2014, the company posted Asia Pacific regional sales of $189.4m, which was a drop of 2% in dollar sales, but an increase of 2% in local currencies, a figure that was boosted by a higher price and product mix.
In Asia, the company is most prominent in China's direct cosmetics sales market, but it has failed to make significant impact in this potentially massive market, where domestic players and international rivals such as Amway and Nu Skin have made progress.
For the full year 2014, sales in the Asia Pacific region were $702.7m, which was a fall of 11% in US dollars, but the decline in local currencies was just 4%, when factoring in the negative impact of currency translations.
Results in other regions were even harder hit
Currency translations hit the company’s other regional results even more significantly, which meant that overall sales revenues for the quarter were down 12% to $2.3bn, which global beauty sales declining 14%, resulting in the company posting a loss of $331m.
In the other regions, sales fell across the board, dropping 15% in Latin America, 11% in EMEA and 12% in North America.
But CEO Sheri McCoy remains upbeat, stating that the strengthening of the US dollar since the beginning of 2015, is likely to bode well for the company’s first quarter of 2015.
Avon CEO points to upward trend
"While progress against our financial goals in 2014 was slower than I would have liked, I am pleased with the sequential improvements we made in several key markets and categories in the second half of the year,” adds McCoy.
“We have stronger management teams across our key markets and better discipline in executing consistently against Avon's core processes. Going into 2015, we intend to build on that momentum.”
But despite McCoy’s upbeat comments, the fact is that Avon has now been knocked off the position of being the world’s largest direct sales player by Amway, indicating a shrinking market share.
Likewise, the investment world reacted negatively to the results, with share prices falling following the results announcement and S&P ratings agency lowering its estimate of the company to ‘Hold’.