Avon Announces New $2 Billion, Five-Year Stock Buyback Program

NEW YORK, Oct. 11 /PRNewswire-FirstCall/ -- Avon Products, Inc. (NYSE:AVP) today announced that its Board of Directors authorized the repurchase of $2 billion of the company's common stock over a five-year period following completion of its current program. Through September 30, 2007, Avon purchased 26 million shares at a total cost of $904 million under the existing program begun in late 2005. Avon has had a share repurchase program since 1994.

Under the new authorization, Avon's annual share purchase volume will depend on the company's operating performance. Repurchases may take place from time to time, depending on market conditions, and the shares may be purchased in open-market or privately negotiated transactions. As of September 30, 2007, the company had approximately 429 million shares outstanding.

Andrea Jung, Avon's chairman and chief executive officer said, "We're very pleased to commit to this new, larger stock repurchase program. Today's announcement is indicative of the long-term health of our business and our ongoing commitment to enhance shareholders' return on their investment in Avon."

Avon, the company for women, is a leading global beauty company, with almost $9 billion in annual revenue. As the world's largest direct seller, Avon markets to women in well over 100 countries through over five million independent Avon Sales Representatives. Avon's product line includes beauty products, fashion jewelry and apparel, and features such well-recognized brand names as Avon Color, Anew, Skin-So-Soft, Avon Solutions, Advance Techniques, Avon Naturals, Mark, and Avon Wellness. Learn more about Avon and its products at www.avoncompany.com.


Statements in this release that are not historical facts or information are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "estimate," "project," "plan," "believe," "may," "expect," "anticipate," "intend," "planned," "potential" and similar expressions, or the negative of those expressions, may identify forward-looking statements. Such forward-looking statements are based on management's reasonable current assumptions and expectations. 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 implement the key initiatives of and realize the
       projected benefits from our global business strategy, including our
       multi-year restructuring initiatives, product mix and pricing
       strategies, enterprise resource planning, customer service initiatives,
       product line simplification, strategic sourcing initiative, zero
       overhead growth and cash management, tax, foreign currency hedging and
       risk management strategies;
    -- our ability to realize the anticipated benefits from our multi-year
       restructuring initiatives or other strategic initiatives on the time
       schedules or in the amounts that we expect, and our plans to invest
       these anticipated benefits ahead of future growth;
    -- the possibility of business disruption in connection with our
       multi-year restructuring initiatives or other strategic initiatives;
    -- our ability to realize sustainable growth from our investments in our
       brand and the direct selling channel;
    -- the inventory obsolescence and other costs associated with our product
       line simplification program;
    -- our ability to achieve growth objectives, particularly in our largest
       markets and new and emerging markets;
    -- our ability to successfully identify new business opportunities and
       identify and analyze acquisition candidates, and our ability to
       negotiate and consummate acquisitions as well as to successfully
       integrate or manage any acquired business;
    -- the effect of political, legal and regulatory risks, as well as foreign
       exchange or other restrictions, imposed on us, our operations or our
       Representatives by governmental entities;
    -- our ability to successfully transition our business in China in
       connection with the resumption of direct selling in that market and our
       ability to operate using the direct selling model permitted in that
    -- the impact of substantial currency fluctuations on the results of our
       foreign operations;
    -- general economic and business conditions in our markets, including
       social, economic and political uncertainties in Latin America, Asia
       Pacific, Central and Eastern Europe and the Middle East;
    -- the risk of disruption in Central and Eastern Europe associated with a
       change to a more rapid selling cycle with more frequent brochures;
    -- a general economic downturn, information technology systems outages,
       disruption in our supply chain or manufacturing and distribution
       operations, or other sudden disruption in business operations beyond
       our control as a result of events such as acts of terrorism or war,
       natural disasters, pandemic situations and large scale power outages;
    -- the risk of product or ingredient shortages resulting from our
       concentration of sourcing in fewer suppliers;
    -- the quality, safety and efficacy of our products;
    -- the success of our research and development activities;
    -- our ability to attract and retain key personnel and executives;
    -- competitive uncertainties in our markets, including competition from
       companies in the cosmetics, fragrances, skin care and toiletries
       industry, some of which are larger than we are and have greater
    -- our ability to implement our Sales Leadership program globally, to
       generate Representative activity, to increase Representative
       productivity, to improve Internet-based tools for our Representatives,
       and to compete with other direct selling organizations to recruit,
       retain and service Representatives;
    -- the impact of the seasonal nature of our business, changes in market
       trends, purchasing habits of our consumers and changes in consumer
       preferences, particularly given the global nature of our business and
       the conduct of our business in primarily one channel;
    -- our ability to protect our intellectual property rights;
    -- the risk of an adverse outcome in our material pending and future
    -- our access to financing and ability to secure financing at attractive
       rates; and
    -- the impact of possible pension funding obligations, increased pension
       expense and any changes in pension regulations or interpretations
       thereof on our cash flow and results of operations.

Additional information identifying such factors is contained in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2006, filed with the U.S. Securities and Exchange Commission. We undertake no obligation to update any such forward-looking statements.

Source: Avon Products, Inc.

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