Avon 2010 Annual Report Download - page 45

Latin America – 2009 Compared to 2008
%/Point Change
2009 2008 US$ Constant $
Total revenue $4,103.2 $3,884.1 6% 16%
Operating profit 647.9 690.3 (6)% 2%
CTI Restructuring 34.4 6.1
Adjusted Non-GAAP operating profit 682.3 696.4 (2)% 7%
Operating margin 15.8% 17.8% (2.0) (2.0)
CTI Restructuring .8 .2
Adjusted Non-GAAP operating margin 16.6% 17.9% (1.3) (1.3)
Units sold 6%
Active Representatives 10%
Total revenue increased for 2009 reflecting growth in Active Representatives, driven by investments in RVP, and a higher average order,
offset by unfavorable foreign exchange. Revenue increased 9% in Brazil and declined 11% in Mexico for 2009. Constant $ revenue for
2009 benefited from growth in all markets, particularly from increases of 17% in Brazil and 8% in Mexico. Revenue in Venezuela for 2009
grew 18% in both Constant $ and U.S. dollars.
Constant $ revenue growth in Brazil for 2009 was primarily driven by an increase in Active Representatives, as well as a higher average
order. Constant $ revenue growth in Mexico for 2009 was driven by a significant increase in Active Representatives, partially offset
by a lower average order, reflecting a difficult economic climate. Revenue growth in Venezuela for 2009 reflected increased prices
due to inflation.
During 2009, operating margin was negatively impacted by .6 points due to higher CTI restructuring compared to the same period in the
prior year. On an Adjusted Non-GAAP basis, excluding CTI restructuring, the decrease in operating margin in Latin America for 2009 was
primarily due to an estimated 2 point negative impact of unfavorable foreign exchange transactions, which included the cost of our
Venezuelan subsidiary settling certain U.S. dollar-denominated liabilities through transactions with non-government sources where the
exchange rate was less favorable than the official rate (the “parallel market”). Partially offsetting these negative impacts was the benefit of
higher revenues and fixed overhead expense.
North America – 2010 Compared to 2009
%/Point Change
2010 2009 US$ Constant $
Total revenue $2,244.0 $2,293.4 (2)% (3)%
Operating profit 155.9 110.4 41% 37%
CTI Restructuring 41.3 40.5
Adjusted Non-GAAP operating profit 197.2 150.9 31% 28%
Operating margin 6.9% 4.8% 2.1 2.0
CTI Restructuring 1.8 1.8
Adjusted Non-GAAP operating margin 8.8% 6.6% 2.2 2.1
Units sold (7)%
Active Representatives (3)%
North America consists largely of the U.S. business and 2010 results include the results of Silpada, for the period since our acquisition at the
end of July 2010. Silpada favorably impacted North America revenue growth by 5 points during 2010. Silpada also favorably impacted
operating profit growth by 31 points during 2010 and favorably impacted Adjusted Non-GAAP operating profit growth by 23 points. As a
result of the Silpada acquisition, units sold and Active Representatives for 2010 were each favorably impacted by 1 point.
A V O N 2010 33