Avon 2010 Annual Report Download - page 27

under the Pension Protection Act of 2006, such as pension funding obligations and limitations on a hybrid plan’s interest crediting rate to
the “market rate of return”, may result in a significant increase or decrease in the valuation of pension obligations affecting the reported
funded status of our pension plans.
The market price of our common stock could be subject to fluctuations as a result
of many factors.
Factors that could affect the trading price of our common stock include the following:
• variations in operating results;
• economic conditions and volatility in the financial markets;
• announcements or significant developments in connection with our business and with respect to beauty and related products or the
beauty industry in general;
• actual or anticipated variations in our quarterly or annual financial results;
• governmental policies and regulations;
• estimates of our future performance or that of our competitors or our industries;
• general economic, political, and market conditions;
• market rumors; and
• factors relating to competitors.
The trading price of our common stock has been, and could in the future continue to be, subject to significant fluctuations.
ITEM 1B. UNRESOLVED STAFF COMMENTS
Not applicable.
ITEM 2. PROPERTIES
Our principal properties worldwide consist of manufacturing facilities for the production of Beauty products, distribution centers where
offices are located and where finished merchandise is packed and shipped to Representatives in fulfillment of their orders, and one principal
research and development facility. Our domestic manufacturing facilities are located in Morton Grove, IL and Springdale, OH. Our domestic
distribution centers are located in Atlanta, GA; Zanesville, OH; and Pasadena, CA. Our research and development facility is located in
Suffern, NY. We also lease office space in three locations in New York City and own property in Rye, NY, for our executive and
administrative offices. In early 2010, we entered into a lease for a new office location in New York City that as of June, 2011 is expected to
replace one of the existing New York City office locations on more favorable terms.
In 2010 Avon acquired Silpada Designs, Inc., a direct seller of sterling silver jewelry with operations in the United States including an office
and warehouse in Lenexa, Kansas.
Other principal properties outside the U.S. measuring 50,000 square feet or more include the following:
• two distribution centers for primary use in North America operations (other than in the U.S.);
• four manufacturing facilities, eleven distribution centers and two administrative offices in Latin America;
• three manufacturing facilities in Europe, primarily servicing Western Europe, Middle East & Africa and Central & Eastern Europe;
• six distribution centers and three administrative offices in Western Europe, Middle East & Africa;
• four distribution centers and two administrative offices in Central & Eastern Europe;
• four manufacturing facilities, four distribution centers, and two administrative offices in Asia Pacific; and
• two manufacturing facilities and six distribution centers in China.
Of all the properties listed above, 33 are owned and the remaining 38 are leased. Many of our properties are used for a combination of
manufacturing, distribution and administration. These properties are included in the above listing based on primary usage.
We consider all of these properties to be in good repair, to adequately meet our needs and to operate at reasonable levels of
productive capacity.
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