Avon 2012 Annual Report Download - page 8

CAUTIONARY STATEMENT FOR PURPOSES OF THE “SAFE HARBOR”
STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM
ACT OF 1995
Statements in this report (or in the documents it incorporates by reference) that are not historical facts or information may be forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “estimate,” “project,” “forecast,”
“plan,” “believe,” “may,” “expect,” “anticipate,” “intend,” “planned,” “potential,” “can,” “expectation,” “could,” “will,” “would” and
similar expressions, or the negative of those expressions, may identify forward-looking statements. They include, among other things,
statements regarding our anticipated or expected results, future financial performance, various strategies and initiatives (including our
stabilization strategies, cost savings initiative, multi-year restructuring programs and other initiatives and related actions), liquidity, cash flow
and uses of cash, our ability to service our debt obligations or obtain additional financing, costs and cost savings, competitive advantages,
impairments, the impact of currency devaluations and other laws and regulations, government investigations, internal investigations and
compliance reviews, results of litigation, contingencies, taxes and tax rates, potential acquisitions or divestitures, hedging and risk
management strategies, pension, postretirement and incentive compensation plans, supply chain and the legal status of our Representatives.
Such forward-looking statements are based on management’s reasonable current assumptions, expectations, plans and forecasts regarding
the Company’s current or future results and future business and economic conditions more generally. Such forward-looking statements
involve risks, uncertainties and other factors, which may cause the actual results, levels of activity, performance or achievement of Avon to be
materially different from any future results expressed or implied by such forward-looking statements, and there can be no assurance that
actual results will not differ materially from management’s expectations. Such factors include, among others, the following:
• our ability to improve our financial and operational performance and execute fully our global business strategy, including our ability to
implement the key initiatives of, and realize the projected benefits (in the amounts and time schedules we expect) from, our stabilization
strategies, cost savings initiative, multi-year restructuring programs and other initiatives, product mix and pricing strategies, enterprise
resource planning, customer service initiatives, sales and operation planning process, outsourcing strategies, Internet platform and
technology strategies, information technology and related system enhancements and cash management, tax, foreign currency hedging
and risk management strategies, and any plans to invest these projected benefits ahead of future growth;
• the possibility of business disruption in connection with our stabilization strategies, cost savings initiative, multi-year restructuring
programs or other initiatives;
• our ability to improve our business in North America, including enhancing our Leadership model;
• our ability to improve working capital and effectively manage doubtful accounts and inventory and implement initiatives to reduce
inventory levels, including the potential impact on cash flows and obsolescence;
• our ability to reverse declines in Active Representatives, to implement our Leadership program globally, to generate Representative activity,
to increase the number of consumers served per Representative and their engagement online, to enhance the Representative and
consumer experience and increase Representative productivity through field activation programs and technology tools and enablers,
execution of Service Model Transformation and other investments in the direct-selling channel, and to compete with other direct-selling
organizations to recruit, retain and service Representatives and to continue to innovate the direct-selling model;
• our ability to reverse declining margins and net income;
• general economic and business conditions in our markets, including social, economic and political uncertainties in the international
markets in our portfolio;
• our ability to achieve profitable growth, particularly in our largest markets, such as Brazil and the United States (“U.S.”), and developing
and emerging markets, such as Mexico and Russia, and our ability to realize sustainable growth from our investments in our brand and
the direct-selling channel;
• the effect of economic factors, including inflation and fluctuations in interest rates and currency exchange rates, as well as the designation
of Venezuela as a highly inflationary economy, foreign exchange restrictions and the potential effect of such factors on our business,
results of operations and financial condition;
• our indebtedness and debt service obligations, our ability to access and generate cash to repay debt and cover debt service obligations,
our access to short- and long-term financing, our ability to refinance upcoming maturities of our current indebtedness or to secure such
refinancing at attractive rates and terms, our ability to secure other financing or to secure such other financing at attractive rates and
terms, and our credit ratings and the impact of any changes on our financing costs, rates, terms, debt service obligations and access to
lending sources;
• our ability to comply with certain covenants in our debt instruments, including the impact of any significant restructuring charges or
significant legal or regulatory settlements, or obtain necessary waivers from compliance with, or necessary amendments to, such
covenants, and the impact any non-compliance may have on our ability to secure financing;
• any developments in or consequences of investigations and compliance reviews, and any litigation related thereto, including the ongoing
investigations and compliance reviews of Foreign Corrupt Practices Act and related U.S. and foreign law matters in China and additional
countries, as well as any disruption or adverse consequences resulting from such investigations, reviews, related actions or litigation;
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