Avon to trim 1,500 jobs, exit Vietnam
Avon Products Inc., the world’s largest door-to-door cosmetics seller, will cut about 1,500 jobs globally and exit South Korea and Vietnam as part of plan to save $400 million by the end of 2015.
The steps will result in pretax costs of about $80 million to $90 million, with $50 million to $60 million recorded in the fourth quarter, the New York-based company said on December 11 in a statement.
Chief Executive Officer Sheri McCoy, who took over in April, announced the cost-cutting goal last month and said she would lower the company’s dividend as it works to recover from three years of declining profit. The actions announced on December 11 will be completed by the end of next year and account for about 20 percent of Avon’s savings target.
“The new management team is making definitive changes to the company’s cost structure,” Connie Maneaty, an analyst at Bank of Montreal in New York, wrote in a note yesterday. She rates the shares outperform, the equivalent of a buy.
Avon rose 0.5 percent to $14.54 at 10:34 a.m. in New York. The shares fell 17 percent this year through December 11.
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| Miss Vietnam Mai Phuong Thuy in an event to celebrate Avon's 125th anniversary in Vietnam early 2011. |
Chief Executive Officer Sheri McCoy, who took over in April, announced the cost-cutting goal last month and said she would lower the company’s dividend as it works to recover from three years of declining profit. The actions announced on December 11 will be completed by the end of next year and account for about 20 percent of Avon’s savings target.
“The new management team is making definitive changes to the company’s cost structure,” Connie Maneaty, an analyst at Bank of Montreal in New York, wrote in a note yesterday. She rates the shares outperform, the equivalent of a buy.
Avon rose 0.5 percent to $14.54 at 10:34 a.m. in New York. The shares fell 17 percent this year through December 11.
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