Document And Entity Information
Document And Entity Information | 3 Months Ended |
Mar. 31, 2017shares | |
DEI [Abstract] | |
Document Type | 10-Q |
Amendment Flag | false |
Document Period End Date | Mar. 31, 2017 |
Document Fiscal Year Focus | 2,017 |
Document Fiscal Period Focus | Q1 |
Entity Registrant Name | AVON PRODUCTS INC |
Entity Central Index Key | 8,868 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Large Accelerated Filer |
Entity Common Stock, Shares Outstanding | 439,847,678 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Statement [Abstract] | ||
Net sales | $ 1,298.1 | $ 1,280 |
Other revenue | 35 | 26.5 |
Total revenue | 1,333.1 | 1,306.5 |
Costs, expenses and other: | ||
Cost of sales | 517.1 | 518.8 |
Selling, general and administrative expenses | 787.3 | 779.9 |
Operating profit | 28.7 | 7.8 |
Interest expense | 35.1 | 32.7 |
Interest income | (4.7) | (4) |
Other expense, net | 5 | 137.2 |
Total other expenses | 35.4 | 165.9 |
Loss before taxes | (6.7) | (158.1) |
Income taxes | (29.8) | 2.3 |
Loss from continuing operations, net of tax | (36.5) | (155.8) |
Loss from discontinued operations, net of tax | 0 | (9.6) |
Net loss | (36.5) | (165.4) |
Net loss attributable to noncontrolling interests | 0 | (0.5) |
Net loss attributable to Avon | $ (36.5) | $ (165.9) |
Basic attributable to Avon | ||
Basic from continuing operations (in usd per share) | $ (0.10) | $ (0.36) |
Basic from discontinued operations (in usd per share) | 0 | (0.02) |
Basic attributable to Avon (in usd per share) | (0.10) | (0.38) |
Diluted from continuing operations (in usd per share) | (0.10) | (0.36) |
Diluted from discontinued operations (in usd per share) | 0 | (0.02) |
Diluted (in usd per share) | (0.10) | (0.38) |
Cash dividends per common share (in usd per share) | $ 0 | $ 0 |
Consolidated Statements Of Comp
Consolidated Statements Of Comprehensive Income (Loss) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (36.5) | $ (165.4) |
Other comprehensive income: | ||
Foreign currency translation adjustments | 62 | 95.9 |
Change in derivative losses on cash flow hedges, net of taxes of $0.0 and $0.0 | 0 | 0.4 |
Adjustments of and amortization of net actuarial loss and prior service cost, net of taxes of $0.0 and $10.4 | 3.1 | 264 |
Other comprehensive income related to New Avon investment, net of taxes of $0.0 | 1.1 | 0 |
Total other comprehensive income, net of taxes | 66.2 | 360.3 |
Comprehensive income | 29.7 | 194.9 |
Less: comprehensive income attributable to noncontrolling interests | 0.1 | 1.1 |
Comprehensive income attributable to Avon | $ 29.6 | $ 193.8 |
Consolidated Statements Of Com4
Consolidated Statements Of Comprehensive Income (Loss) Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Change in derivative losses on cash flow hedges, tax | $ 0 | $ 0 |
Adjustment of and amortization of net actuarial loss and prior service cost, taxes | 0 | $ (10.4) |
Other comprehensive income, equity method investment, tax | $ 0 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Current Assets | ||
Cash and cash equivalents | $ 560 | $ 654.4 |
Accounts receivable, net | 457 | 458.9 |
Inventories | 630.4 | 586.4 |
Prepaid expenses and other | 300.2 | 291.3 |
Current assets of discontinued operations | 1.3 | 1.3 |
Total current assets | 1,948.9 | 1,992.3 |
Property, plant and equipment, at cost | 1,488.9 | 1,424.1 |
Less accumulated depreciation | (756) | (712.8) |
Property, plant and equipment, net | 732.9 | 711.3 |
Goodwill | 97.1 | 93.6 |
Other assets | 647.3 | 621.7 |
Total assets | 3,426.2 | 3,418.9 |
Current Liabilities | ||
Debt maturing within one year | 20.1 | 18.1 |
Accounts payable | 754.3 | 768.1 |
Accrued compensation | 129.4 | 129.2 |
Other accrued liabilities | 362 | 401.9 |
Sales and taxes other than income | 158.7 | 147 |
Income taxes | 19.1 | 10.7 |
Current liabilities of discontinued operations | 7.3 | 10.7 |
Total current liabilities | 1,450.9 | 1,485.7 |
Long-term debt | 1,874.9 | 1,875.8 |
Employee benefit plans | 167.9 | 164.5 |
Long-term income taxes | 76.9 | 78.6 |
Other liabilities | 213.8 | 205.8 |
Total liabilities | 3,784.4 | 3,810.4 |
Commitments and contingencies (Note 8) | ||
Series C convertible preferred stock | 450.4 | 444.7 |
Shareholders’ Deficit | ||
Common stock | 189.5 | 188.8 |
Additional paid-in capital | 2,283 | 2,273.9 |
Retained earnings | 2,280 | 2,322.2 |
Accumulated other comprehensive loss | (967.1) | (1,033.2) |
Treasury stock, at cost | (4,605.9) | (4,599.7) |
Total Avon shareholders’ deficit | (820.5) | (848) |
Noncontrolling interests | 11.9 | 11.8 |
Total shareholders’ deficit | (808.6) | (836.2) |
Total liabilities, series C convertible preferred stock and shareholders’ deficit | $ 3,426.2 | $ 3,418.9 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Cash Flows from Operating Activities | |||
Net loss | $ (36.5) | $ (165.4) | |
Loss from discontinued operations, net of tax | 0 | 9.6 | |
Loss from continuing operations, net of tax | (36.5) | (155.8) | |
Adjustments to reconcile net loss to net cash used by operating activities: | |||
Depreciation | 20.5 | 20.5 | |
Amortization | 7.1 | 7.1 | |
Provision for doubtful accounts | 60.8 | 37 | |
Provision for obsolescence | 10.2 | 12.6 | |
Share-based compensation | 9.7 | 6.2 | |
Foreign exchange (gains) losses | (0.9) | 1.7 | |
Deferred income taxes | 12.3 | (13.5) | |
Deconsolidation of Venezuela, net of tax of $0.0 | 0 | 120.5 | |
Other | 6 | 2.2 | |
Changes in assets and liabilities: | |||
Accounts receivable | (42.3) | (21.4) | |
Inventories | (23.5) | (80.5) | |
Prepaid expenses and other | 10 | (14.2) | |
Accounts payable and accrued liabilities | (107.3) | (61.8) | |
Income and other taxes | 1.7 | 8 | |
Noncurrent assets and liabilities | (8) | (59.9) | |
Net cash used by operating activities of continuing operations | (80.2) | (191.3) | |
Cash Flows from Investing Activities | |||
Capital expenditures | (23.9) | (23.7) | |
Disposal of assets | 1.6 | 1.3 | |
Reduction of cash due to Venezuela deconsolidation | 0 | (4.5) | |
Other investing activities | 0 | 1.6 | |
Net cash used by investing activities of continuing operations | (22.3) | (25.3) | |
Cash Flows from Financing Activities | |||
Debt, net (maturities of three months or less) | 1.9 | 3.7 | |
Proceeds from debt | 0 | 8.6 | |
Repayment of debt | (1) | (1) | |
Repurchase of common stock | (6.2) | (3.5) | |
Net proceeds from the sale of series C convertible preferred stock | 0 | 428.1 | |
Net cash (used) provided by financing activities of continuing operations | (5.3) | 435.9 | |
Net cash used by operating activities of discontinued operations | (3.5) | (44.9) | |
Net cash used by investing activities of discontinued operations | 0 | (96.7) | |
Net cash used by discontinued operations | (3.5) | (141.6) | |
Effect of exchange rate changes on cash and cash equivalents | 16.9 | (8.9) | |
Net (decrease) increase in cash and cash equivalents | (94.4) | 68.8 | |
Cash and cash equivalents at beginning of year | 654.4 | 684.7 | [1] |
Cash and cash equivalents at end of period | $ 560 | $ 753.5 | |
[1] | Includes cash and cash equivalents of discontinued operations of $(2.2) at the beginning of the year in 2016. |
Consolidated Statements of Cas7
Consolidated Statements of Cash Flows (Parenthetical) $ in Millions | Dec. 31, 2015USD ($) |
Statement of Cash Flows [Abstract] | |
Cash and cash equivalents of discontinued operations and held for sale | $ (2.2) |
ACCOUNTING POLICIES
ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
ACCOUNTING POLICIES | ACCOUNTING POLICIES Basis of Presentation We prepare our unaudited interim Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States ("GAAP"). We consistently applied the accounting policies described in our 2016 Annual Report on Form 10-K (" 2016 Form 10-K") in preparing these unaudited Consolidated Financial Statements. In our opinion, the unaudited interim Consolidated Financial Statements reflect all adjustments of a normal recurring nature that are necessary for a fair statement of the results for the interim periods presented. Results for interim periods are not necessarily indicative of results for a full year. You should read these unaudited interim Consolidated Financial Statements in conjunction with our consolidated financial statements contained in our 2016 Form 10-K. When used in this report, the terms "Avon," "Company," "we" or "us" mean Avon Products, Inc. For interim Consolidated Financial Statements purposes we provide for accruals under our various employee benefit plans for each quarter based on one quarter of the estimated annual expense. In addition, our income tax provision is determined using an estimate of our consolidated annual effective tax rate, adjusted in the current period for discrete income tax items including: • the effects of significant, unusual or extraordinary pretax and income tax items, if any; • withholding taxes recognized associated with cash repatriations; and • the impact of loss-making subsidiaries for which we cannot recognize an income tax benefit and subsidiaries that reduce the reliability of the estimated annual consolidated effective tax rate. Venezuela As of March 31, 2016, we deconsolidated our Venezuelan operations, and since then, we account for this business using the cost method of accounting. The decision to deconsolidate our Venezuelan operations was due to the lack of exchangeability between the Venezuelan bolivar and the U.S. dollar. This was caused by Venezuela's restrictive foreign exchange control regulations and our Venezuelan operations' increasingly limited access to U.S. dollars, which restricted our Venezuelan operations' ability to pay dividends and settle intercompany obligations. As a result of the change to the cost method of accounting, in the first quarter of 2016, we recorded a loss of $120.5 in other expense, net. The loss was comprised of $39.2 in net assets of the Venezuelan business and $81.3 in accumulated foreign currency translation adjustments within accumulated other comprehensive loss ("AOCI") (shareholders' deficit) associated with foreign currency changes before Venezuela was accounted for as a highly inflationary economy. The net assets of the Venezuelan business were comprised of inventories of $23.7 , property, plant and equipment, net of $15.0 , other assets of $11.4 , accounts receivable of $4.6 , cash of $4.5 , and accounts payable and accrued liabilities of $20.0 . Our Consolidated Balance Sheets no longer include the assets and liabilities of our Venezuelan operations. We no longer include the results of our Venezuelan operations in our Consolidated Financial Statements, and will include income relating to our Venezuelan operations only to the extent that we receive cash for dividends or royalties remitted by Avon Venezuela. Revisions In our 2016 Form 10-K, our Consolidated Statements of Cash Flows presented supplemental information of the cash paid for interest of $87.1 for the year ended December 31, 2016; however, this amount should have been disclosed as $142.8 . We determined that the effect of this revision was not material to our 2016 Form 10-K. New Accounting Standards Implemented In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation , which is intended to simplify the accounting for share-based payment transactions. This new guidance changes several aspects of the accounting for share-based payment transactions, including accounting for income taxes, forfeitures and employer-tax withholding requirements. ASU 2016-09 also clarifies the Statements of Cash Flows presentation for certain components of share-based payment awards. We have adopted this new accounting guidance in the first quarter of 2017, which did not have a material impact on our Consolidated Financial Statements. Accounting Standards to be Implemented In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers , as a new Topic, Accounting Standards Codification Topic ("ASC") 606. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We intend to adopt this new accounting guidance effective January 1, 2018. This new accounting guidance can be adopted either retrospectively or as a cumulative-effect adjustment as of the date of adoption, but we have not yet determined our method of adoption. We are currently evaluating the effect that adopting this new accounting guidance will have on our Consolidated Financial Statements. Based on the evaluation completed to-date, we believe that we will need to: • consider some of our sales incentive programs as a separate deliverable and allocate a portion of the sales transaction price to this deliverable; • adjust the manner in which we present our allowance for sales returns in our Consolidated Balance Sheets; • reflect fees paid by the Representative to the Company for items such as brochures, sales aids and late payments as revenue, rather than as a reduction to selling, general and administrative expenses ("SG&A"), as these represent separate performance obligations; and • reflect certain of the costs associated with the fees paid by the Representative, as well as the costs associated with shipping and handling and order processing, in cost of sales, rather than SG&A. In March 2017, the FASB issued ASU 2017-07, Compensation - Retirement Benefits . This new guidance requires entities to (1) disaggregate the service cost component from the other components of net periodic benefit costs and present it with other current employee compensation costs in the Consolidated Statements of Operations and (2) present the other components of net periodic benefit costs below operating profit. We intend to adopt this new accounting guidance effective January 1, 2018. The new accounting guidance is applied retrospectively and will increase our operating profit for the first quarter of 2017 and the full year 2016 by $.9 and $2.1 , respectively, but will have no impact on net income (loss). In February 2016, the FASB issued ASU 2016-02, Leases , which requires all assets and liabilities arising from leases to be recognized in the statement of financial position. We intend to adopt this new accounting guidance effective January 1, 2019. We are currently evaluating the effect that adopting this new accounting guidance will have on our Consolidated Financial Statements. |
EARNINGS (LOSS) PER SHARE AND S
EARNINGS (LOSS) PER SHARE AND SHARE REPURCHASES | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share Reconciliation [Abstract] | |
EARNINGS (LOSS) PER SHARE AND SHARE REPURCHASES | EARNINGS (LOSS) PER SHARE AND SHARE REPURCHASES We compute earnings (loss) per share ("EPS") using the two-class method, which is an earnings (loss) allocation formula that determines earnings (loss) per share for common stock, and earnings (loss) allocated to convertible preferred stock and participating securities, as appropriate. The earnings allocated to convertible preferred stock are the larger of 1) the preferred dividends accrued in the period or 2) the percentage of earnings from continuing operations allocable to the preferred stock as if they had been converted to common stock. Our participating securities are our grants of restricted stock and restricted stock units, which contain non-forfeitable rights to dividend equivalents to the extent any dividends are declared and paid on our common stock. We compute basic EPS by dividing net income (loss) allocated to common shareholders by the weighted-average number of shares outstanding during the period. Diluted EPS is calculated to give effect to all potentially dilutive common shares that were outstanding during the period. Three Months Ended March 31, (Shares in millions) 2017 2016 Numerator from continuing operations: Loss from continuing operations, less amounts attributable to noncontrolling interests $ (36.5 ) $ (156.3 ) Less: Loss allocated to participating securities .5 1.9 Less: Earnings allocated to convertible preferred stock (5.7 ) (1.8 ) Loss from continuing operations allocated to common shareholders (41.7 ) (156.2 ) Numerator from discontinued operations: Loss from discontinued operations $ — $ (9.6 ) Less: Loss allocated to participating securities — .1 Loss allocated to common shareholders — (9.5 ) Numerator attributable to Avon: Net loss attributable to Avon $ (36.5 ) $ (165.9 ) Less: Loss allocated to participating securities .5 2.0 Less: Earnings allocated to convertible preferred stock — (1.8 ) Loss allocated to common shareholders (36.0 ) (165.7 ) Denominator: Basic EPS weighted-average shares outstanding 438.6 435.9 Diluted effect of assumed conversion of stock options — — Diluted EPS adjusted weighted-average shares outstanding 438.6 435.9 Loss per Common Share from continuing operations: Basic $ (.10 ) $ (.36 ) Diluted (.10 ) (.36 ) Loss per Common Share from discontinued operations: Basic $ — $ (.02 ) Diluted — (.02 ) Loss per Common Share attributable to Avon: Basic $ (.10 ) $ (.38 ) Diluted (.10 ) (.38 ) Amounts in the table above may not necessarily sum due to rounding. During the three months ended March 31, 2017 and 2016, we did not include stock options to purchase 13.1 million shares and 11.0 million shares, respectively, of Avon common stock in the calculation of diluted EPS as we had a loss from continuing operations, net of tax, and the inclusion of these shares would decrease the net loss per share, and therefore, their inclusion would be anti-dilutive. For the three months ended March 31, 2017 and 2016, it is more dilutive to assume the Series C Convertible Preferred Stock is not converted into common stock; therefore, the weighted-average outstanding shares outstanding was not adjusted by the as-if converted Series C Convertible Preferred Stock because the effect would be anti-dilutive as it would decrease the net loss per share. If the as-if converted Series C Convertible Preferred Stock had been dilutive, approximately 87.1 million additional shares would have been included in the diluted weighted average number of shares outstanding for the three months ended March 31, 2017 and 2016. See Note 5, Related Party Transactions. We purchased approximately 1.4 million shares of Avon common stock for $6.2 during the first three months of 2017, as compared to approximately .9 million shares of Avon common stock for $3.5 during the first three months of 2016, through acquisition of stock from employees in connection with tax payments upon vesting of restricted stock units and performance restricted stock units. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 3 Months Ended |
Mar. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS On December 17, 2015, the Company entered into definitive agreements with affiliates controlled by Cerberus Capital Management, L.P. ("Cerberus"). The agreements include an investment agreement providing for a $435.0 investment by Cleveland Apple Investor L.P. (“Cerberus Investor”) (an affiliate of Cerberus) in the Company through the purchase of perpetual convertible preferred stock (see Note 5, Related Party Transactions) and a separation and investment agreement providing for the separation of the Company's North America business, which represented the Company's operations in the United States, Canada and Puerto Rico, from the Company into New Avon LLC ("New Avon"), a privately-held company that is majority-owned and managed by Cerberus NA Investor LLC (“Cerberus NA”) (an affiliate of Cerberus). These transactions closed on March 1, 2016. The major classes of financial statement components comprising the loss on discontinued operations, net of tax for North America are shown below: Three Months Ended March 31, 2016 Total revenue $ 135.2 Cost of sales 53.2 Selling, general and administrative expenses 87.8 Operating loss (5.8 ) Other income items .6 Loss from discontinued operations, before tax (5.2 ) Loss on sale of discontinued operations, before tax (14.9 ) Income taxes 10.5 Loss from discontinued operations, net of tax $ (9.6 ) |
INVESTMENT IN NEW AVON (Notes)
INVESTMENT IN NEW AVON (Notes) | 3 Months Ended |
Mar. 31, 2017 | |
Schedule of Equity Method Investments [Line Items] | |
Equity Method Investments and Joint Ventures Disclosure [Text Block] | INVESTMENT IN NEW AVON In connection with the separation of the Company's North America business (as discussed in Note 3, Discontinued Operations), which closed on March 1, 2016, the Company retained a 19.9% ownership interest in New Avon. The Company accounts for its ownership interests in New Avon using the equity method of accounting, which results in the Company recognizing its proportionate share of New Avon's income or loss and other comprehensive income or loss. The Company's proportionate share of the losses of New Avon was $4.0 and $3.9 during the three months ended March 31, 2017 and one month ended March 31, 2016, respectively, and was recorded within other expense, net. The Company also recorded an additional loss of $.5 within other expense, net and a benefit of $1.1 within other comprehensive income, during the three months ended March 31, 2017, primarily associated with purchase accounting adjustments reported by New Avon. At March 31, 2017, our investment in New Avon was $29.4 and was classified within other assets in our Consolidated Balance Sheets. Summarized financial information related to New Avon is shown below: Three Months Ended March 31, 2017 One Month Ended March 31, 2016 Total revenue $ 176.8 $ 88.8 Gross profit $ 110.2 $ 53.4 Net loss $ (20.3 ) $ (19.6 ) |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS The following tables present the related party transactions with New Avon and affiliates of Cerberus. New Avon is majority owned and managed by Cerberus NA. See Note 3, Discontinued Operations and Note 4, Investment in Avon for further details. Three Months Ended March 31, 2017 2016 Statement of Operations Data Revenue from sale of product to New Avon (1) $ 8.0 $ 3.7 Gross profit from sale of product to New Avon (1) $ .6 $ .5 Cost of sales for purchases from New Avon (2) $ .8 $ .9 Selling, general and administrative expenses: Transition services, research and development and subleases (3) $ (7.9 ) $ (3.9 ) Project management team (4) .8 — Net reduction of selling, general and administrative expenses $ (7.1 ) $ (3.9 ) March 31, 2017 December 31, 2016 Balance Sheet Data Inventories (5) $ .8 $ 1.0 Receivables due from New Avon (6) $ 6.8 $ 11.6 Payables due to New Avon (7) $ .4 $ .7 Payables due to an affiliate of Cerberus (8) $ .6 $ .6 (1) The Company supplies product to New Avon as part of a manufacturing and supply agreement. The Company recorded revenue of $8.0 and $3.7 , within other revenue, and gross profit of $.6 and $.5 associated with this agreement during the three months ended March 31, 2017 and 2016, respectively. (2) New Avon also supplies product to the Company as part of this manufacturing and supply agreement. The Company purchased $1.0 and $1.2 from New Avon associated with this agreement during the three months ended March 31, 2017 and 2016, respectively, and recorded $.8 and $.9 associated with these purchases within cost of sales during the three months ended March 31, 2017 and 2016, respectively. (3) The Company also entered into a transition services agreement to provide certain services to New Avon, as well as an agreement for research and development and subleases for office space. In addition, New Avon is performing certain services for the Company under a similar transition services agreement. The Company recorded a net $7.9 and $3.9 reduction of selling, general and administrative expenses associated with these agreements during the three months ended March 31, 2017 and 2016, respectively, which generally represents a recovery of the related costs. (4) The Company also entered into agreements with an affiliate of Cerberus, which provide for the secondment of Cerberus affiliate personnel to the Company's project management team responsible for assisting with the execution of the transformation plan (the "Transformation Plan") announced in January 2016. The Company recorded $.8 in selling, general and administrative expenses associated with these agreements during the three months ended March 31, 2017. See Note 12, Restructuring Initiatives for additional information related to the Transformation Plan. (5) Inventories relate to purchases from New Avon, associated with the manufacturing and supply agreement, which have not yet been sold, and were classified within inventories in the Consolidated Balance Sheets. (6) The receivables due from New Avon relate to the agreements for transition services, research and development and subleases for office space, as well as the manufacturing and supply agreement, and were classified within prepaid expenses and other in the Consolidated Balance Sheets. (7) The payables due to New Avon relate to the manufacturing and supply agreement, and were classified within other accrued liabilities in the Consolidated Balance Sheets. (8) The payables due to an affiliate of Cerberus relate to the agreement for the project management team, and were classified within other accrued liabilities in the Consolidated Balance Sheets. In addition, the Company also issued standby letters of credit to the lessors of certain equipment, a lease for which was transferred to New Avon in connection with the separation of the Company's North America business. As of March 31, 2017, the Company has a liability of $1.6 for the estimated value of such standby letters of credit. The recognition of the initial liability of $2.1 was included in the estimated loss on sale of the North America business in loss from discontinued operations, net of tax during the three months ended March 31, 2016. Series C Preferred Stock On March 1, 2016, the Company issued and sold to Cerberus Investor 435,000 shares of newly issued Series C Preferred Stock for an aggregate purchase price of $435.0 . Cumulative preferred dividends accrue daily on the Series C Preferred Stock at a rate of 1.25% per quarter. The Series C Preferred Stock had accrued unpaid dividends of $24.1 as of March 31, 2017. There were no dividends declared in the three months ended March 31, 2017 and 2016. |
INVENTORIES
INVENTORIES | 3 Months Ended |
Mar. 31, 2017 | |
Inventory, Net [Abstract] | |
Inventories | INVENTORIES Components of Inventories March 31, 2017 December 31, 2016 Raw materials $ 194.3 $ 179.3 Finished goods 436.1 407.1 Total $ 630.4 $ 586.4 |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 3 Months Ended |
Mar. 31, 2017 | |
General Discussion of Pension and Other Postretirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS Three Months Ended March 31, Pension Benefits Net Periodic Benefit Costs U.S. Plans Non-U.S. Plans Postretirement Benefits 2017 2016 2017 2016 2017 2016 Service cost $ 1.4 $ 2.3 $ 1.2 $ 1.3 $ — $ .1 Interest cost .7 4.3 4.4 6.0 .4 .6 Expected return on plan assets (.8 ) (5.2 ) (6.7 ) (8.8 ) — — Amortization of prior service credit — (.1 ) — — (.1 ) (.9 ) Amortization of net actuarial losses 1.2 6.1 1.8 1.7 — .2 Settlements/curtailments — .1 — — — — Net periodic benefit costs (1) $ 2.5 $ 7.5 $ .7 $ .2 $ .3 $ — (1) Includes $4.4 of U.S. pension and immaterial amounts of the postretirement benefit plans (related to the U.S.) for the three months ended March 31, 2016, which are included in discontinued operations. Amounts associated with the pension and postretirement benefit plans in Canada and the postretirement benefit plan in Puerto Rico, which are included in discontinued operations, have been excluded from all amounts in the table above. See Note 3, Discontinued Operations for discussion of the separation of the Company's North America business. During the three months ended March 31, 2017 , we made less than $1 and approximately $5 of contributions to the U.S. and non-U.S. defined benefit pension and postretirement benefit plans, respectively. During the remainder of 2017, we anticipate contributing approximately $10 to $15 and approximately $15 to $20 to fund our U.S. and non-U.S. defined benefit pension and postretirement benefit plans, respectively. |
CONTINGENCIES
CONTINGENCIES | 3 Months Ended |
Mar. 31, 2017 | |
Loss Contingency [Abstract] | |
Contingencies | CONTINGENCIES Settlements of FCPA Investigations As previously reported, we engaged outside counsel to conduct an internal investigation and compliance reviews focused on compliance with the FCPA and related U.S. and foreign laws in China and additional countries. The internal investigation, which was conducted under the oversight of our Audit Committee, began in June 2008 and along with the compliance reviews, was completed in 2014. Following our voluntary reporting of the internal investigation to both the DOJ and the SEC and our subsequent cooperation with those agencies, the United States District Court for the Southern District of New York (the "USDC") approved in December 2014 a deferred prosecution agreement (“DPA”) entered into between the Company and the DOJ related to charges of violations of the books and records and internal controls provisions of the FCPA. In addition, Avon Products (China) Co. Ltd., a subsidiary of the Company operating in China, pleaded guilty to conspiring to violate the books and records provision of the FCPA and was sentenced by the USDC to pay a $ 68 fine. The SEC also filed a complaint against the Company charging violations of the books and records and internal controls provisions of the FCPA and the Consent which was approved in a judgment entered by the USDC in January 2015, and included $ 67 in disgorgement and prejudgment interest. The DPA, the above-mentioned guilty plea and the Consent resolved the SEC’s and the DOJ’s investigations of the Company’s compliance with the FCPA and related U.S. laws in China and additional countries. The fine was paid in December 2014 and the payment to the SEC was made in January 2015. Under the DPA, the DOJ will defer criminal prosecution of the Company for a term of three years. If the Company remains in compliance with the DPA during its term, the charges against the Company will be dismissed with prejudice. Under the DPA, the Company also represented that it has implemented and agreed that it will continue to implement a compliance and ethics program designed to prevent and detect violations of the FCPA and other applicable anti-corruption laws throughout its operations. Under the DPA and the Consent, among other things, the Company agreed to have a compliance monitor (the "monitor"). During July 2015, the Company engaged a monitor, who had been approved by the DOJ and SEC. With the approval of the DOJ and the SEC, the monitor can be replaced by the Company, if the Company agrees to undertake self-reporting obligations for the remainder of the monitoring period. The monitoring period is scheduled to expire in July 2018. There can be no assurance as to whether or when the DOJ and the SEC will approve replacing the monitor with the Company’s self-reporting. If the DOJ determines that the Company has knowingly violated the DPA, the DOJ may commence prosecution or extend the term of the DPA, including the monitoring provisions described above, for up to one year. The monitor is assessing and monitoring the Company's compliance with the terms of the DPA and the Consent by evaluating, among other things, the Company's internal accounting controls, recordkeeping and financial reporting policies and procedures. The monitor has recommended some changes to our policies and procedures that we are in the process of adopting, and may make additional recommendations that we must adopt unless they are unduly burdensome or otherwise inadvisable, in which case we may propose alternatives, which the DOJ and the SEC may or may not accept. In addition, operating under the oversight of the monitor may result in additional time and attention on these matters by members of our management, which may divert their time from the operation of our business. Assuming the monitor is replaced by a self-reporting period, the Company’s self-reporting obligations may be costly or time-consuming. The third-party costs incurred in connection with ongoing compliance with the DPA and the Consent, including the monitorship, have not been material to date and we do not anticipate material costs going forward. We currently cannot estimate the costs that we are likely to incur in connection with self-reporting, if applicable, and any additional costs of implementing the changes, if any, to our policies and procedures required by the monitor. Litigation Matters Between December 23, 2014 and March 12, 2015, two purported class actions were filed in the United States District Court for the Southern District of New York -- Poovathur v. Avon Products, Inc., et al. ( No. 14-CV-10083) and McCoy et al. v. Avon Products, Inc., et al. ( No. 15-CV-01828) asserting claims under the Employee Retirement Income Security Act ("ERISA") against the Company, the Plan's administrator, benefits board and investment committee, and certain individuals alleged to have served as Plan fiduciaries. On April 8, 2015, the Court consolidated the two actions and recaptioned the consolidated case as In re 2014 Avon Products, Inc. ERISA Litigation, ( No. 14-CV-10083). On May 8, 2015, plaintiffs filed a consolidated complaint, asserting claims for alleged breach of fiduciary duty and failure to monitor under ERISA on behalf of a purported class of participants in and beneficiaries of the Plan who invested in and/or held shares of the Avon Common Stock Fund between July 31, 2006 and May 1, 2014 and between December 14, 2011 and the present. Plaintiffs seek, inter alia , certain monetary relief, damages, and declaratory, injunctive and other equitable relief. On July 9, 2015, Defendants moved to dismiss the consolidated complaint. The parties reached an agreement on a settlement of this class action. The terms of settlement include releases by members of the class of claims against the Company and the individual defendants and payment of approximately $6 . Approximately $5 of the settlement was paid by the Company’s insurer and approximately $1 was paid by the Company (which represented the remaining deductible under the Company’s applicable insurance policy). On June 7, 2016, the court granted preliminary approval of the settlement and scheduled a hearing to consider final approval for October 11, 2016. On January 3, 2017, the Court issued a Final Approval Order approving the settlement . Brazilian Tax Assessments In 2002, our Brazilian subsidiary received an excise tax (IPI) assessment from the Brazilian tax authorities for alleged tax deficiencies during the years 1997-1998. In December 2012, additional assessments were received for the year 2008 with respect to excise tax (IPI) and taxes charged on gross receipts (PIS and COFINS). In the second quarter of 2014, the PIS and COFINS assessments were officially closed in favor of Avon Brazil. The 2002 and the 2012 IPI assessments assert that the establishment in 1995 of separate manufacturing and distribution companies in Brazil was done without a valid business purpose and that Avon Brazil did not observe minimum pricing rules to define the taxable basis of excise tax. The structure adopted in 1995 is comparable to that used by many other companies in Brazil. We believe that our Brazilian corporate structure is appropriate, both operationally and legally, and that the 2002 and 2012 IPI assessments are unfounded. These matters are being vigorously contested. In January 2013, we filed a protest seeking a first administrative level review with respect to the 2012 IPI assessment. In July 2013, the 2012 IPI assessment was upheld at the first administrative level and we have appealed this decision to the second administrative level. The 2012 IPI assessment totals approximately $352 , including penalties and accrued interest. In October 2010, the 2002 IPI assessment was upheld at the first administrative level at an amount reduced to approximately $ 30 from approximately $ 71 , including penalties and accrued interest. We appealed this decision to the second administrative level, which ruled in favor of Avon in March 2015 and canceled the 2002 IPI assessment. The Brazilian tax authorities' appeal to this favorable decision regarding the 2002 IPI assessment was decided in Avon’s favor in February 2017. This favorable decision remains subject to further appeal by the Brazilian tax authorities. In the event that the 2002 or 2012 IPI assessments are upheld, it may be necessary for us to provide security to pursue further appeals, which, depending on the circumstances, may result in a charge to earnings. It is not possible to reasonably estimate the likelihood or potential amount of assessments that may be issued for subsequent periods (tax years up through 2010 are closed by statute). However, other similar IPI assessments involving different periods (1998-2001) have been canceled and officially closed in our favor by the second administrative level. We believe that the likelihood that the 2002 IPI assessment will be upheld on any further appeal is remote and the likelihood that the 2012 IPI assessment will be upheld is reasonably possible. As stated above, we believe that the 2002 and 2012 IPI assessments are unfounded. Brazil IPI Tax on Cosmetics In May 2015, an Executive Decree on certain cosmetics went into effect in Brazil which increased the amount of IPI taxes that are to be remitted by Avon Brazil to the taxing authority on the sales of cosmetic products subject to IPI. Avon Brazil filed an objection to this IPI tax increase on the basis that it is not constitutional. In December 2016, Avon Brazil received a favorable decision from the Federal District Court regarding this objection. This decision has been appealed by the tax authorities. From May 2015 through April 2016, Avon Brazil remitted the taxes associated with this IPI tax increase into a judicial deposit which would be remitted to the taxing authorities in the event that we are not successful in our objection to the tax increase. In May 2016, Avon Brazil received a favorable preliminary decision on its objection to the tax and was granted a preliminary injunction. As a result, beginning in May 2016, Avon Brazil is no longer required to remit the taxes associated with IPI into a judicial deposit. As the IPI tax increase remains in effect, Avon Brazil is continuing to recognize the IPI taxes associated with the May 2015 Executive Decree as a liability. At March 31, 2017, the liability to the taxing authorities for this IPI tax increase was approximately $ 148 and was classified within other liabilities in our Consolidated Balance Sheets, and the judicial deposit was approximately $74 and was classified within other assets in our Consolidated Balance Sheets. The net liability that does not have a corresponding judicial deposit was $74 at March 31, 2017, and the interest associated with this net liability will be recognized in other expense, net. Our cash flow from operations has benefited as compared to our earnings as we have recognized the expense and associated interest related to this IPI tax in our Consolidated Statements of Operations; however, since May 2016, we have not made a corresponding cash payment into a judicial deposit. An unfavorable ruling to our objection of this IPI tax increase would have an adverse effect on the consolidated cash flows as Avon Brazil would have to remit the liability owed to the taxing authorities. This amount would be partially offset by the amount of the judicial deposit held by Avon Brazil. We are not able to reliably predict the timing of the outcome of our objection to this tax increase. Other Matters Various other lawsuits and claims, arising in the ordinary course of business or related to businesses previously sold, are pending or threatened against Avon. In management's opinion, based on its review of the information available at this time, the total cost of resolving such other contingencies at March 31, 2017, is not expected to have a material adverse effect on our consolidated financial position, results of operations or cash flows. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 3 Months Ended |
Mar. 31, 2017 | |
Accumulated Other Comprehensive Income [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The tables below present the changes in AOCI by component and the reclassifications out of AOCI for the three months ended March 31, 2017 and 2016 : Three Months Ended March 31, 2017: Foreign Currency Translation Adjustments Net Investment Hedges Pension and Postretirement Benefits Investment in New Avon Total Balance at December 31, 2016 $ (910.9 ) $ (4.3 ) $ (120.2 ) $ 2.2 $ (1,033.2 ) Other comprehensive income other than reclassifications 61.9 — — 1.1 63.0 Reclassifications into earnings: Amortization of net actuarial loss and prior service cost, net of tax of $0.0 (2) — — 3.1 — 3.1 Total reclassifications into earnings — — 3.1 — 3.1 Balance at March 31, 2017 $ (849.0 ) $ (4.3 ) $ (117.1 ) $ 3.3 $ (967.1 ) Three Months Ended March 31, 2016: Foreign Currency Translation Adjustments Cash Flow Hedges Net Investment Hedges Pension and Postretirement Benefits Total Balance at December 31, 2015 $ (950.0 ) $ (1.3 ) $ (4.3 ) $ (410.6 ) $ (1,366.2 ) Other comprehensive income (loss) other than reclassifications 23.9 — — (12.7 ) 11.2 Reclassifications into earnings: Derivative losses on cash flow hedges, net of tax of $0.0 (1) — .4 — — .4 Amortization of net actuarial loss and prior service cost, net of tax of $.2 (2) — — — 6.7 6.7 Deconsolidation of Venezuela, net of tax of $0.0 81.3 — — .8 82.1 Separation of North America, net of tax of $10.2 (10.0 ) — — 269.2 259.2 Total reclassifications into earnings 71.3 .4 — 276.7 348.4 Balance at March 31, 2016 $ (854.8 ) $ (.9 ) $ (4.3 ) $ (146.6 ) $ (1,006.6 ) (1) Gross amount reclassified to interest expense, and related taxes reclassified to income taxes. (2) Gross amount reclassified to pension and postretirement expense, within selling, general & administrative expenses, and related taxes reclassified to income taxes. A foreign exchange net gain of $ 3.4 and net loss of $ 1.2 for the three months ended March 31, 2017 and 2016 , respectively, resulting from the translation of actuarial losses and prior service cost recorded in AOCI are included in changes in foreign currency translation adjustments in our Consolidated Statements of Comprehensive Income. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting, Measurement Disclosures [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION We determine segment profit by deducting the related costs and expenses from segment revenue. In order to ensure comparability between periods, segment profit includes an allocation of global marketing expenses based on actual revenues. Segment profit excludes global expenses other than the allocation of marketing, costs to implement ("CTI") restructuring initiatives (see Note 12, Restructuring Initiatives), certain significant asset impairment charges, and other items, which are not allocated to a particular segment, if applicable. This is consistent with the manner in which we assess our performance and allocate resources. Summarized financial information concerning our reportable segments was as follows: Three Months Ended March 31, Total Revenue 2017 2016 Europe, Middle East & Africa $ 507.5 $ 520.4 South Latin America 499.2 426.4 North Latin America 193.2 204.7 Asia Pacific 124.2 134.6 Total revenue from reportable segments 1,324.1 1,286.1 Other operating segments and business activities 9.0 20.4 Total revenue $ 1,333.1 $ 1,306.5 Three Months Ended March 31, Operating Profit 2017 2016 Segment Profit Europe, Middle East & Africa $ 74.6 $ 68.7 South Latin America 13.3 23.1 North Latin America 21.0 28.5 Asia Pacific 12.9 14.8 Total profit from reportable segments $ 121.8 $ 135.1 Other operating segments and business activities 1.2 4.1 Unallocated global expenses (84.3 ) (84.6 ) CTI restructuring initiatives (10.0 ) (46.8 ) Operating profit $ 28.7 $ 7.8 Other operating segments and business activities include the first quarter of 2016 results of Venezuela, as it was deconsolidated effective March 31, 2016, as well as markets that have been exited. Effective in the first quarter of 2017, given that we have exited Thailand during 2016, the results of Thailand are now reported in Other operating segments and business activities for all periods presented, while previously the results had been reported in Asia Pacific. Other operating segments and business activities also include revenue from the sale of products to New Avon since the separation of the Company's North America business into New Avon on March 1, 2016 and ongoing royalties from the licensing of our name and products. |
SUPPLEMENTAL BALANCE SHEET INFO
SUPPLEMENTAL BALANCE SHEET INFORMATION | 3 Months Ended |
Mar. 31, 2017 | |
Balance Sheet Related Disclosures [Abstract] | |
SUPPLEMENTAL BALANCE SHEET INFORMATION | SUPPLEMENTAL BALANCE SHEET INFORMATION At March 31, 2017 and December 31, 2016 , prepaid expenses and other included the following: Components of Prepaid Expenses and Other March 31, 2017 December 31, 2016 Prepaid taxes and tax refunds receivable $ 114.3 $ 99.3 Prepaid brochure costs, paper and other literature 78.1 73.2 Receivables other than trade 55.0 68.3 Other 52.8 50.5 Prepaid expenses and other $ 300.2 $ 291.3 At March 31, 2017 and December 31, 2016 , other assets included the following: Components of Other Assets March 31, 2017 December 31, 2016 Deferred tax assets 162.8 162.1 Long-term receivables 89.6 78.9 Judicial deposits other than Brazil IPI tax (see below) 85.7 78.0 Capitalized software 83.3 83.9 Judicial deposit for Brazil IPI tax on cosmetics (Note 8) 74.4 69.0 Net overfunded pension plans 59.7 54.8 Trust assets associated with supplemental benefit plans 35.9 35.2 Investment in New Avon (Note 4) 29.4 32.8 Tooling (plates and molds associated with our beauty products) 14.5 14.7 Other 12.0 12.3 Other assets $ 647.3 $ 621.7 |
RESTRUCTURING INITIATIVES
RESTRUCTURING INITIATIVES | 3 Months Ended |
Mar. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING INITIATIVES | RESTRUCTURING INITIATIVES Transformation Plan In January 2016, we announced the Transformation Plan, which includes cost reduction efforts to continue to improve our cost structure and to enable us to reinvest in growth. As a result of this plan, we have targeted pre-tax annualized cost savings of approximately $350 after three years, with an estimated $200 from supply chain reductions and an estimated $150 from other cost reductions, which are expected to be achieved through restructuring actions, as well as other cost-savings strategies that will not result in restructuring charges. We plan to reinvest a portion of these cost savings in growth initiatives, including media, social selling and information technology systems that will help us modernize our business. We initiated the Transformation Plan in order to enable us to achieve our long-term goals of double-digit operating margin and mid single-digit constant-dollar revenue growth. As part of the Transformation Plan, we identified certain actions, that we believe will reduce ongoing costs, primarily consisting of global headcount reductions relating to operating model changes, as well as the closure of Thailand, a smaller, under-performing market. These operating model changes include the streamlining of our corporate functions to align with the current and future needs of the business and an information technology infrastructure outsourcing initiative. As a result of these restructuring actions approved-to-date, we have recorded total costs to implement these restructuring initiatives of $116.1 before taxes, of which $10.0 was recorded during the three months ended March 31, 2017, in our Consolidated Statements of Operations. The additional charges not yet incurred associated with the restructuring actions approved to-date of approximately $10 to $15 before taxes are expected to be recorded primarily in 2018. At this time we are unable to quantify the total costs to implement the restructuring initiatives that will be incurred through the time the Transformation Plan is fully implemented as we have not yet identified all actions to be taken. Restructuring Charges - Three Months Ended March 31, 2017 During the three months ended March 31, 2017, we recorded costs to implement of $10.0 related to the Transformation Plan, in our Consolidated Statements of Operations. The costs consisted of the following: • net charges of $7.6 , primarily for employee-related costs, including severance benefits; • contract termination and other net charge of $1.4 ; • implementation costs of $.5 primarily related to professional service fees; and • accelerated depreciation of $.5 . Of the total costs to implement during the three months ended March 31, 2017, $10.1 was recorded in selling, general and administrative expenses and a benefit of $.1 was recorded in cost of sales. Restructuring Charges - Three Months Ended March 31, 2016 During the three months ended March 31, 2016, we recorded costs to implement of $47.5 related to the Transformation Plan, in selling, general and administrative expenses, in our Consolidated Statements of Operations. The costs consisted of the following: • net charge of $47.1 primarily for employee-related costs, including severance benefits; and • implementation costs of $.4 primarily related to professional service fees. The liability balance for the Transformation Plan as of March 31, 2017 is as follows: Employee-Related Costs Contract Terminations/Other Total Balance at December 31, 2016 $ 48.6 $ 2.8 $ 51.4 2017 charges 9.7 — 9.7 Adjustments (2.1 ) 1.4 (.7 ) Cash payments (9.0 ) (.5 ) (9.5 ) Foreign exchange .5 — .5 Balance at March 31, 2017 $ 47.7 $ 3.7 $ 51.4 The majority of cash payments, if applicable, associated with these charges are expected to be made during 2017. The following table presents the restructuring charges incurred to date, under the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plan: Employee- Related Costs Inventory Write-offs Foreign Currency Translation Adjustment Write-offs Contract Terminations/Other Total Charges incurred to-date $ 91.6 $ .4 $ 2.7 $ 10.1 $ 104.8 Estimated charges to be incurred on approved initiatives 6.2 — — 1.2 7.4 Total expected charges on approved initiatives $ 97.8 $ .4 $ 2.7 $ 11.3 $ 112.2 The charges, net of adjustments, of initiatives under the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plan, by reportable segment are as follows: Europe, Middle East & Africa South Latin America North Latin America Asia Pacific Global & Other Operating Segments Total 2015 $ — $ — $ — $ — $ 21.4 $ 21.4 2016 30.9 13.2 4.4 11.7 14.2 74.4 First quarter 2017 3.0 2.7 (.1 ) (.5 ) 3.9 9.0 Charges incurred to-date 33.9 15.9 4.3 11.2 39.5 104.8 Estimated charges to be incurred on approved initiatives 1.2 — — — 6.2 7.4 Total expected charges on approved initiatives $ 35.1 $ 15.9 $ 4.3 $ 11.2 $ 45.7 $ 112.2 We expect our total costs to implement restructuring on approved initiatives to be an estimated $125 to $130 before taxes under the Transformation Plan. The amounts shown in the tables above as charges recorded to-date relate to initiatives that have been approved and recorded in the financial statements as the costs are probable and estimable. The amounts shown in the tables above as total expected charges on approved initiatives represent charges recorded to-date plus charges yet to be recorded for approved initiatives as the relevant accounting criteria for recording an expense have not yet been met. In addition to the charges included in the tables above, we have incurred and will continue to incur other costs to implement restructuring initiatives such as professional services fees and accelerated depreciation. Other Restructuring Initiatives During the three months ended March 31, 2017 and 2016 , we recorded an immaterial amount and a net benefit of $.7 , respectively, in selling, general and administrative expenses, in the Consolidated Statements of Operations, associated with the restructuring programs launched in 2005 and 2009, the restructuring initiatives launched in 2012 (including the cost savings initiative known as the "$400M Cost Savings Initiative"), and the restructuring actions identified during 2015 (collectively, the "Other Restructuring Initiatives"), which are substantially complete. The liability balance associated with the Other Restructuring Initiatives, which primarily consists of employee-related costs, as of March 31, 2017 is not material. |
GOODWILL
GOODWILL | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL | GOODWILL Goodwill Europe, Middle East & Africa South Latin America Asia Pacific Total Gross balance at December 31, 2016 $ 25.6 $ 72.3 $ 85.0 $ 182.9 Accumulated impairments (6.9 ) — (82.4 ) (89.3 ) Net balance at December 31, 2016 $ 18.7 $ 72.3 $ 2.6 $ 93.6 Changes during the period ended March 31, 2017: Foreign exchange .5 3.0 — 3.5 Gross balance at March 31, 2017 $ 26.1 $ 75.3 $ 85.0 $ 186.4 Accumulated impairments (6.9 ) — (82.4 ) (89.3 ) Net balance at March 31, 2017 $ 19.2 $ 75.3 $ 2.6 $ 97.1 |
FAIR VALUE
FAIR VALUE | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE | FAIR VALUE Assets and Liabilities Recorded at Fair Value The fair value measurement provisions required by GAAP establish a fair value hierarchy, which prioritizes the inputs used in measuring fair value into three broad levels as follows: • Level 1 - Quoted prices in active markets for identical assets or liabilities. • Level 2 - Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. • Level 3 - Unobservable inputs based on our own assumptions. Assets and Liabilities Recorded at Fair Value on a Recurring Basis The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of March 31, 2017 : Level 1 Level 2 Total Assets: Available-for-sale securities $ 2.8 $ — $ 2.8 Foreign exchange forward contracts — .4 .4 Total $ 2.8 $ .4 $ 3.2 Liabilities: Foreign exchange forward contracts $ — $ .3 $ .3 Total $ — $ .3 $ .3 The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of December 31, 2016 : Level 1 Level 2 Total Assets: Available-for-sale securities $ 2.8 $ — $ 2.8 Foreign exchange forward contracts — .6 .6 Total $ 2.8 $ .6 $ 3.4 Liabilities: Foreign exchange forward contracts $ — $ 3.0 $ 3.0 Total $ — $ 3.0 $ 3.0 Fair Value of Financial Instruments Our financial instruments include cash and cash equivalents, available-for-sale securities, short-term investments, accounts receivable, loans receivable, debt maturing within one year, accounts payable, long-term debt and foreign exchange forward contracts. The carrying value for cash and cash equivalents, accounts receivable, accounts payable and short-term investments approximate fair value because of the short-term nature of these instruments. The net asset (liability) amounts recorded in the balance sheet (carrying amount) and the estimated fair values of our remaining financial instruments at March 31, 2017 and December 31, 2016 , respectively, consisted of the following: March 31, 2017 December 31, 2016 Carrying Amount Fair Value Carrying Amount Fair Value Available-for-sale securities $ 2.8 $ 2.8 $ 2.8 $ 2.8 Debt maturing within one year (1) (20.1 ) (20.1 ) (18.1 ) (18.1 ) Long-term debt (1) (1,874.9 ) (1,880.8 ) (1,875.8 ) (1,877.5 ) Foreign exchange forward contracts .1 .1 (2.4 ) (2.4 ) (1) The carrying value of debt maturing within one year and long-term debt is presented net of debt issuance costs and includes any related discount or premium and unamortized deferred gains on terminated interest-rate swap agreements, as applicable. The methods and assumptions used to estimate fair value are as follows: Available-for-sale securities - The fair values of these investments were the quoted market prices for issues listed on securities exchanges. Debt maturing within one year and long-term debt - The fair values of our debt and other financing were determined using Level 2 inputs based on indicative market prices. Foreign exchange forward contracts - The fair values of forward contracts were estimated based on quoted forward foreign exchange prices at the reporting date. |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 3 Months Ended |
Mar. 31, 2017 | |
General Discussion of Derivative Instruments and Hedging Activities [Abstract] | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES We operate globally, with manufacturing and distribution facilities in various countries around the world. We may reduce our exposure to fluctuations in the fair value and cash flows associated with changes in interest rates and foreign exchange rates by creating offsetting positions, including through the use of derivative financial instruments. If we use foreign currency-rate sensitive and interest-rate sensitive instruments to hedge a certain portion of our existing and forecasted transactions, we would expect that any gain or loss in value of the hedge instruments generally would be offset by decreases or increases in the value of the underlying forecasted transactions. We do not enter into derivative financial instruments for trading or speculative purposes, nor are we a party to leveraged derivatives. The master agreements governing our derivative contracts generally contain standard provisions that could trigger early termination of the contracts in certain circumstances, including if we were to merge with another entity and the creditworthiness of the surviving entity were to be "materially weaker" than that of Avon prior to the merger. Derivatives are recognized in the Consolidated Balance Sheets at their fair values. The following table presents the fair value of derivative instruments outstanding at March 31, 2017 : Asset Liability Balance Sheet Classification Fair Value Balance Sheet Classification Fair Value Derivatives not designated as hedges: Foreign exchange forward contracts Prepaid expenses and other $ .4 Accounts payable $ .3 Total derivatives not designated as hedges $ .4 $ .3 Total derivatives $ .4 $ .3 The following table presents the fair value of derivative instruments outstanding at December 31, 2016 : Asset Liability Balance Sheet Classification Fair Value Balance Sheet Classification Fair Value Derivatives not designated as hedges: Foreign exchange forward contracts Prepaid expenses and other $ .6 Accounts payable $ 3.0 Total derivatives not designated as hedges $ .6 $ 3.0 Total derivatives $ .6 $ 3.0 Interest Rate Risk A portion of our borrowings is subject to interest rate risk. In the past we have used interest-rate swap agreements, which effectively converted the fixed rate on long-term debt to a floating interest rate, to manage our interest rate exposure. The agreements were designated as fair value hedges. As of March 31, 2017 , we do not have any interest-rate swap agreements. Approximately 1% of our debt portfolio at March 31, 2017 and December 31, 2016 was exposed to floating interest rates. In January 2013, we terminated eight of our interest-rate swap agreements previously designated as fair value hedges, with notional amounts totaling $ 1,000 . As of the interest-rate swap agreements’ termination date, the aggregate favorable adjustment to the carrying value (deferred gain) of our debt was $ 90.4 , which was amortized as a reduction to interest expense over the remaining term of the underlying debt obligations. The net impact of the gain amortization was $3.7 for the three months ended March 31, 2016 . At March 31, 2017, there is no unamortized deferred gain associated with the January 2013 interest-rate swap termination, as the underlying debt obligations have been paid. In March 2012, we terminated two of our interest-rate swap agreements previously designated as fair value hedges, with notional amounts totaling $ 350 . As of the interest-rate swap agreements’ termination date, the aggregate favorable adjustment to the carrying value (deferred gain) of our debt was $ 46.1 , which is being amortized as a reduction to interest expense over the remaining term of the underlying debt obligations through March 2019. The net impact of the gain amortization was $1.2 and $1.7 , respectively, for the three months ended March 31, 2017 and 2016, respectively. At March 31, 2017 , the unamortized deferred gain associated with the March 2012 interest-rate swap termination was $9.7 , and was classified within long-term debt in our Consolidated Balance Sheets. Foreign Currency Risk We may use foreign exchange forward contracts to manage a portion of our foreign currency exchange rate exposures. At March 31, 2017 , we had outstanding foreign exchange forward contracts with notional amounts totaling approximately $65 for various currencies. We may use foreign exchange forward contracts to manage foreign currency exposure of certain intercompany loans. These contracts are not designated as hedges. The change in fair value of these contracts is immediately recognized in earnings and substantially offsets the foreign currency impact recognized in earnings relating to the associated intercompany loans. During the three months ended March 31, 2017 and 2016, we recorded a gain of $.5 and a loss of $2.3 , respectively, in other expense, net in our Consolidated Statements of Operations related to these undesignated foreign exchange forward contracts. Also during the three months ended March 31, 2017 and 2016, we recorded a loss of $1.2 and a gain of $.8 , resp ectively, related to the associated intercompany loans, caused by changes in foreign currency exchange rates. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Debt | DEBT Revolving Credit Facility In June 2015, the Company and Avon International Operations, Inc. ("AIO"), a wholly-owned domestic subsidiary of the Company, entered into a five-year $400.0 senior secured revolving credit facility (the “2015 facility”). Borrowings under the 2015 facility bear interest, at our option, at a rate per annum equal to LIBOR plus 250 basis points or a floating base rate plus 150 basis points, in each case subject to adjustment based upon a leverage-based pricing grid. As of March 31, 2017 , there were no amounts outstanding under the 2015 facility. All obligations of AIO under the 2015 facility are (i) unconditionally guaranteed by each material domestic restricted subsidiary of the Company (other than AIO, the borrower), in each case, subject to certain exceptions and (ii) fully guaranteed on an unsecured basis by the Company. The obligations of AIO and the subsidiary guarantors are secured by first priority liens on and security interest in substantially all of the assets of AIO and the subsidiary guarantors, in each case, subject to certain exceptions. The 2015 facility will terminate in June 2020; provided, however, that it shall terminate on the 91 st day prior to the maturity of the 6.50% Notes (as defined below) and the 4.60% Notes (as defined below), if on such 91 st day, the applicable notes are not redeemed, repaid, discharged, defeased or otherwise refinanced in full. The 2015 facility contains affirmative and negative covenants, which are customary for secured financings of this type, as well as financial covenants (interest coverage and total leverage ratios). As of March 31, 2017 , we were in compliance with our interest coverage and total leverage ratios under the 2015 facility. The amount of the facility available to be drawn down is reduced by any standby letters of credit granted by AIO, which, as of March 31, 2017 , was approximately $44 . As of March 31, 2017 , based on then applicable interest rates, the entire amount of the remaining 2015 facility, which is approximately $356 , could have been drawn down without violating any covenant. Public Notes In March 2013, we issued, in a public offering, $250.0 principal amount of 2.375% Notes due March 15, 2016 (the "2.375% Notes"), $500.0 principal amount of 4.60% Notes due March 15, 2020 (the "4.60% Notes"), $500.0 principal amount of 5.00% Notes due March 15, 2023 (the "5.00% Notes") and $250.0 principal amount of 6.95% Notes due March 15, 2043 (the "6.95% Notes") (collectively, the "2013 Notes"). In March 2008, we issued $350.0 principal amount of 6.50% Notes due March 1, 2019 (the "6.50% Notes"). Interest on the 2013 Notes is payable semi-annually on March 15 and September 15 of each year, and interest on the 6.50% Notes are payable semi-annually on March 1 and September 1 of each year. In August 2015, we prepaid the entire principal amount of our 2.375% Notes plus accrued interest and a make-whole premium. In 2016, we completed cash tender offers totaling to a $300.6 reduction for certain of our outstanding public notes, repurchased $180.5 of certain of our outstanding public notes, and prepaid the remaining principal amounts totaling $238.4 of our 4.20% Notes due July 15, 2018 and our 5.75% Notes due March 1, 2018, plus accrued interest and a make-whole premium (the "2016 debt transactions"). The indenture governing the 2013 Notes contains interest rate adjustment provisions depending on the long-term credit ratings assigned to the 2013 Notes with S&P and Moody's. As described in the indenture, the interest rates on the 2013 Notes increase by .25% for each one-notch downgrade below investment grade on each of our long-term credit ratings assigned to the 2013 Notes by S&P or Moody's. These adjustments are limited to a total increase of 2% above the respective interest rates in effect on the date of issuance of the 2013 Notes. As a result of the long-term credit rating downgrades by S&P and Moody's since issuance of the 2013 Notes, the interest rates on these notes have increased by the maximum allowable increase. The indentures governing our outstanding notes described above contain certain customary covenants and customary events of default and cross-default provisions. Further, we would be required to make an offer to repurchase all of our outstanding notes described above at a price equal to 101% of their aggregate principal amount plus accrued and unpaid interest in the event of a change in control involving Avon and, at such time, the outstanding notes are rated below investment grade. Senior Secured Notes In August 2016, AIO issued, in a private placement exempt from registration under the Securities Act of 1933, as amended, $500.0 in aggregate principal amount of 7.875% Senior Secured Notes, which will mature on August 15, 2022 (the "Senior Secured Notes"). Interest on the Senior Secured Notes is payable semi-annually on February 15 and August 15 of each year. All obligations of AIO under the Senior Secured Notes are unconditionally guaranteed by each current and future wholly-owned domestic restricted subsidiary of the Company that is a guarantor under the 2015 facility and fully guaranteed on an unsecured basis by the Company. The obligations of AIO and the subsidiary guarantors are secured by first priority liens on and security interest in substantially all of the assets of AIO and the subsidiary guarantors, in each case, subject to certain exceptions. The indenture governing our Senior Secured Notes contains certain customary covenants and restrictions as well as customary events of default and cross-default provisions. The indenture also contains a covenant requiring AIO and its restricted subsidiaries to, at the end of each year, own at least a certain percentage of the total assets of API and its restricted subsidiaries, subject to certain qualifications. Further, we would be required to make an offer to repurchase all of our Senior Secured Notes, at a price equal to 101% of their aggregate principal amount plus accrued and unpaid interest, in the event of a change in control involving Avon. Long-Term Credit Ratings Our long-term credit ratings are: Moody’s ratings of Stable Outlook with B1 for corporate family debt, B3 for senior unsecured debt, and Ba1 for the Senior Secured Notes; S&P ratings of Positive Outlook with B for corporate family debt and senior unsecured debt and BB- for the Senior Secured Notes; and Fitch rating of Negative Outlook with B+, each of which are below investment grade. We do not believe these long-term credit ratings will have a material impact on our near-term liquidity. However, any rating agency reviews could result in a change in outlook or downgrade, which could further limit our access to new financing, particularly short-term financing, reduce our flexibility with respect to working capital needs, affect the market price of some or all of our outstanding debt securities, and likely result in an increase in financing costs, and less favorable covenants and financial terms under our financing arrangements. |
ACCOUNTING POLICIES (Policy)
ACCOUNTING POLICIES (Policy) | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation We prepare our unaudited interim Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States ("GAAP"). We consistently applied the accounting policies described in our 2016 Annual Report on Form 10-K (" 2016 Form 10-K") in preparing these unaudited Consolidated Financial Statements. In our opinion, the unaudited interim Consolidated Financial Statements reflect all adjustments of a normal recurring nature that are necessary for a fair statement of the results for the interim periods presented. Results for interim periods are not necessarily indicative of results for a full year. You should read these unaudited interim Consolidated Financial Statements in conjunction with our consolidated financial statements contained in our 2016 Form 10-K. When used in this report, the terms "Avon," "Company," "we" or "us" mean Avon Products, Inc. For interim Consolidated Financial Statements purposes we provide for accruals under our various employee benefit plans for each quarter based on one quarter of the estimated annual expense. In addition, our income tax provision is determined using an estimate of our consolidated annual effective tax rate, adjusted in the current period for discrete income tax items including: • the effects of significant, unusual or extraordinary pretax and income tax items, if any; • withholding taxes recognized associated with cash repatriations; and • the impact of loss-making subsidiaries for which we cannot recognize an income tax benefit and subsidiaries that reduce the reliability of the estimated annual consolidated effective tax rate. |
Venezuela | Venezuela As of March 31, 2016, we deconsolidated our Venezuelan operations, and since then, we account for this business using the cost method of accounting. The decision to deconsolidate our Venezuelan operations was due to the lack of exchangeability between the Venezuelan bolivar and the U.S. dollar. This was caused by Venezuela's restrictive foreign exchange control regulations and our Venezuelan operations' increasingly limited access to U.S. dollars, which restricted our Venezuelan operations' ability to pay dividends and settle intercompany obligations. As a result of the change to the cost method of accounting, in the first quarter of 2016, we recorded a loss of $120.5 in other expense, net. The loss was comprised of $39.2 in net assets of the Venezuelan business and $81.3 in accumulated foreign currency translation adjustments within accumulated other comprehensive loss ("AOCI") (shareholders' deficit) associated with foreign currency changes before Venezuela was accounted for as a highly inflationary economy. The net assets of the Venezuelan business were comprised of inventories of $23.7 , property, plant and equipment, net of $15.0 , other assets of $11.4 , accounts receivable of $4.6 , cash of $4.5 , and accounts payable and accrued liabilities of $20.0 . Our Consolidated Balance Sheets no longer include the assets and liabilities of our Venezuelan operations. We no longer include the results of our Venezuelan operations in our Consolidated Financial Statements, and will include income relating to our Venezuelan operations only to the extent that we receive cash for dividends or royalties remitted by Avon Venezuela. |
Revisions | Revisions In our 2016 Form 10-K, our Consolidated Statements of Cash Flows presented supplemental information of the cash paid for interest of $87.1 for the year ended December 31, 2016; however, this amount should have been disclosed as $142.8 . We determined that the effect of this revision was not material to our 2016 Form 10-K. |
New Accounting Standards | New Accounting Standards Implemented In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation , which is intended to simplify the accounting for share-based payment transactions. This new guidance changes several aspects of the accounting for share-based payment transactions, including accounting for income taxes, forfeitures and employer-tax withholding requirements. ASU 2016-09 also clarifies the Statements of Cash Flows presentation for certain components of share-based payment awards. We have adopted this new accounting guidance in the first quarter of 2017, which did not have a material impact on our Consolidated Financial Statements. Accounting Standards to be Implemented In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers , as a new Topic, Accounting Standards Codification Topic ("ASC") 606. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We intend to adopt this new accounting guidance effective January 1, 2018. This new accounting guidance can be adopted either retrospectively or as a cumulative-effect adjustment as of the date of adoption, but we have not yet determined our method of adoption. We are currently evaluating the effect that adopting this new accounting guidance will have on our Consolidated Financial Statements. Based on the evaluation completed to-date, we believe that we will need to: • consider some of our sales incentive programs as a separate deliverable and allocate a portion of the sales transaction price to this deliverable; • adjust the manner in which we present our allowance for sales returns in our Consolidated Balance Sheets; • reflect fees paid by the Representative to the Company for items such as brochures, sales aids and late payments as revenue, rather than as a reduction to selling, general and administrative expenses ("SG&A"), as these represent separate performance obligations; and • reflect certain of the costs associated with the fees paid by the Representative, as well as the costs associated with shipping and handling and order processing, in cost of sales, rather than SG&A. In March 2017, the FASB issued ASU 2017-07, Compensation - Retirement Benefits . This new guidance requires entities to (1) disaggregate the service cost component from the other components of net periodic benefit costs and present it with other current employee compensation costs in the Consolidated Statements of Operations and (2) present the other components of net periodic benefit costs below operating profit. We intend to adopt this new accounting guidance effective January 1, 2018. The new accounting guidance is applied retrospectively and will increase our operating profit for the first quarter of 2017 and the full year 2016 by $.9 and $2.1 , respectively, but will have no impact on net income (loss). In February 2016, the FASB issued ASU 2016-02, Leases , which requires all assets and liabilities arising from leases to be recognized in the statement of financial position. We intend to adopt this new accounting guidance effective January 1, 2019. We are currently evaluating the effect that adopting this new accounting guidance will have on our Consolidated Financial Statements. |
EARNINGS (LOSS) PER SHARE AND25
EARNINGS (LOSS) PER SHARE AND SHARE REPURCHASES (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share Reconciliation [Abstract] | |
Components of Basic and Diluted Earnings per Share | Three Months Ended March 31, (Shares in millions) 2017 2016 Numerator from continuing operations: Loss from continuing operations, less amounts attributable to noncontrolling interests $ (36.5 ) $ (156.3 ) Less: Loss allocated to participating securities .5 1.9 Less: Earnings allocated to convertible preferred stock (5.7 ) (1.8 ) Loss from continuing operations allocated to common shareholders (41.7 ) (156.2 ) Numerator from discontinued operations: Loss from discontinued operations $ — $ (9.6 ) Less: Loss allocated to participating securities — .1 Loss allocated to common shareholders — (9.5 ) Numerator attributable to Avon: Net loss attributable to Avon $ (36.5 ) $ (165.9 ) Less: Loss allocated to participating securities .5 2.0 Less: Earnings allocated to convertible preferred stock — (1.8 ) Loss allocated to common shareholders (36.0 ) (165.7 ) Denominator: Basic EPS weighted-average shares outstanding 438.6 435.9 Diluted effect of assumed conversion of stock options — — Diluted EPS adjusted weighted-average shares outstanding 438.6 435.9 Loss per Common Share from continuing operations: Basic $ (.10 ) $ (.36 ) Diluted (.10 ) (.36 ) Loss per Common Share from discontinued operations: Basic $ — $ (.02 ) Diluted — (.02 ) Loss per Common Share attributable to Avon: Basic $ (.10 ) $ (.38 ) Diluted (.10 ) (.38 ) |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Major Classes of Financial Statement Components Comprising the Loss on Discontinued Operations | The major classes of financial statement components comprising the loss on discontinued operations, net of tax for North America are shown below: Three Months Ended March 31, 2016 Total revenue $ 135.2 Cost of sales 53.2 Selling, general and administrative expenses 87.8 Operating loss (5.8 ) Other income items .6 Loss from discontinued operations, before tax (5.2 ) Loss on sale of discontinued operations, before tax (14.9 ) Income taxes 10.5 Loss from discontinued operations, net of tax $ (9.6 ) |
INVESTMENT IN NEW AVON (Tables)
INVESTMENT IN NEW AVON (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Schedule of Equity Method Investments [Line Items] | |
Equity Method Investments [Table Text Block] | Summarized financial information related to New Avon is shown below: Three Months Ended March 31, 2017 One Month Ended March 31, 2016 Total revenue $ 176.8 $ 88.8 Gross profit $ 110.2 $ 53.4 Net loss $ (20.3 ) $ (19.6 ) |
RELATED PARTY TRANSACTIONS RELA
RELATED PARTY TRANSACTIONS RELATED PARTY TRANSACTIONS (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Related Party Transaction [Line Items] | |
Schedule of Related Party Transactions [Table Text Block] | The following tables present the related party transactions with New Avon and affiliates of Cerberus. New Avon is majority owned and managed by Cerberus NA. See Note 3, Discontinued Operations and Note 4, Investment in Avon for further details. Three Months Ended March 31, 2017 2016 Statement of Operations Data Revenue from sale of product to New Avon (1) $ 8.0 $ 3.7 Gross profit from sale of product to New Avon (1) $ .6 $ .5 Cost of sales for purchases from New Avon (2) $ .8 $ .9 Selling, general and administrative expenses: Transition services, research and development and subleases (3) $ (7.9 ) $ (3.9 ) Project management team (4) .8 — Net reduction of selling, general and administrative expenses $ (7.1 ) $ (3.9 ) March 31, 2017 December 31, 2016 Balance Sheet Data Inventories (5) $ .8 $ 1.0 Receivables due from New Avon (6) $ 6.8 $ 11.6 Payables due to New Avon (7) $ .4 $ .7 Payables due to an affiliate of Cerberus (8) $ .6 $ .6 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Inventory, Net [Abstract] | |
Components of Inventories | Components of Inventories March 31, 2017 December 31, 2016 Raw materials $ 194.3 $ 179.3 Finished goods 436.1 407.1 Total $ 630.4 $ 586.4 |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
General Discussion of Pension and Other Postretirement Benefits [Abstract] | |
Components of Net Periodic Benefit Cost | Three Months Ended March 31, Pension Benefits Net Periodic Benefit Costs U.S. Plans Non-U.S. Plans Postretirement Benefits 2017 2016 2017 2016 2017 2016 Service cost $ 1.4 $ 2.3 $ 1.2 $ 1.3 $ — $ .1 Interest cost .7 4.3 4.4 6.0 .4 .6 Expected return on plan assets (.8 ) (5.2 ) (6.7 ) (8.8 ) — — Amortization of prior service credit — (.1 ) — — (.1 ) (.9 ) Amortization of net actuarial losses 1.2 6.1 1.8 1.7 — .2 Settlements/curtailments — .1 — — — — Net periodic benefit costs (1) $ 2.5 $ 7.5 $ .7 $ .2 $ .3 $ — |
ACCUMULATED OTHER COMPREHENSI31
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Amounts in Accumulated Other Comprehensive Income (Loss) | The tables below present the changes in AOCI by component and the reclassifications out of AOCI for the three months ended March 31, 2017 and 2016 : Three Months Ended March 31, 2017: Foreign Currency Translation Adjustments Net Investment Hedges Pension and Postretirement Benefits Investment in New Avon Total Balance at December 31, 2016 $ (910.9 ) $ (4.3 ) $ (120.2 ) $ 2.2 $ (1,033.2 ) Other comprehensive income other than reclassifications 61.9 — — 1.1 63.0 Reclassifications into earnings: Amortization of net actuarial loss and prior service cost, net of tax of $0.0 (2) — — 3.1 — 3.1 Total reclassifications into earnings — — 3.1 — 3.1 Balance at March 31, 2017 $ (849.0 ) $ (4.3 ) $ (117.1 ) $ 3.3 $ (967.1 ) Three Months Ended March 31, 2016: Foreign Currency Translation Adjustments Cash Flow Hedges Net Investment Hedges Pension and Postretirement Benefits Total Balance at December 31, 2015 $ (950.0 ) $ (1.3 ) $ (4.3 ) $ (410.6 ) $ (1,366.2 ) Other comprehensive income (loss) other than reclassifications 23.9 — — (12.7 ) 11.2 Reclassifications into earnings: Derivative losses on cash flow hedges, net of tax of $0.0 (1) — .4 — — .4 Amortization of net actuarial loss and prior service cost, net of tax of $.2 (2) — — — 6.7 6.7 Deconsolidation of Venezuela, net of tax of $0.0 81.3 — — .8 82.1 Separation of North America, net of tax of $10.2 (10.0 ) — — 269.2 259.2 Total reclassifications into earnings 71.3 .4 — 276.7 348.4 Balance at March 31, 2016 $ (854.8 ) $ (.9 ) $ (4.3 ) $ (146.6 ) $ (1,006.6 ) (1) Gross amount reclassified to interest expense, and related taxes reclassified to income taxes. (2) Gross amount reclassified to pension and postretirement expense, within selling, general & administrative expenses, and related taxes reclassified to income taxes. |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting, Measurement Disclosures [Abstract] | |
Total Revenue and Operating Profit by Reporting Segment | Summarized financial information concerning our reportable segments was as follows: Three Months Ended March 31, Total Revenue 2017 2016 Europe, Middle East & Africa $ 507.5 $ 520.4 South Latin America 499.2 426.4 North Latin America 193.2 204.7 Asia Pacific 124.2 134.6 Total revenue from reportable segments 1,324.1 1,286.1 Other operating segments and business activities 9.0 20.4 Total revenue $ 1,333.1 $ 1,306.5 Three Months Ended March 31, Operating Profit 2017 2016 Segment Profit Europe, Middle East & Africa $ 74.6 $ 68.7 South Latin America 13.3 23.1 North Latin America 21.0 28.5 Asia Pacific 12.9 14.8 Total profit from reportable segments $ 121.8 $ 135.1 Other operating segments and business activities 1.2 4.1 Unallocated global expenses (84.3 ) (84.6 ) CTI restructuring initiatives (10.0 ) (46.8 ) Operating profit $ 28.7 $ 7.8 |
SUPPLEMENTAL BALANCE SHEET IN33
SUPPLEMENTAL BALANCE SHEET INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Balance Sheet Related Disclosures [Abstract] | |
Components of Prepaid Expenses and Other | At March 31, 2017 and December 31, 2016 , prepaid expenses and other included the following: Components of Prepaid Expenses and Other March 31, 2017 December 31, 2016 Prepaid taxes and tax refunds receivable $ 114.3 $ 99.3 Prepaid brochure costs, paper and other literature 78.1 73.2 Receivables other than trade 55.0 68.3 Other 52.8 50.5 Prepaid expenses and other $ 300.2 $ 291.3 |
Components of Other Assets | At March 31, 2017 and December 31, 2016 , other assets included the following: Components of Other Assets March 31, 2017 December 31, 2016 Deferred tax assets 162.8 162.1 Long-term receivables 89.6 78.9 Judicial deposits other than Brazil IPI tax (see below) 85.7 78.0 Capitalized software 83.3 83.9 Judicial deposit for Brazil IPI tax on cosmetics (Note 8) 74.4 69.0 Net overfunded pension plans 59.7 54.8 Trust assets associated with supplemental benefit plans 35.9 35.2 Investment in New Avon (Note 4) 29.4 32.8 Tooling (plates and molds associated with our beauty products) 14.5 14.7 Other 12.0 12.3 Other assets $ 647.3 $ 621.7 |
RESTRUCTURING INITIATIVES (Tabl
RESTRUCTURING INITIATIVES (Tables) - Transformation Plan [Member] | 3 Months Ended |
Mar. 31, 2017 | |
Restructuring Cost and Reserve [Line Items] | |
Schedule of Restructuring Reserve by Type of Cost | The liability balance for the Transformation Plan as of March 31, 2017 is as follows: Employee-Related Costs Contract Terminations/Other Total Balance at December 31, 2016 $ 48.6 $ 2.8 $ 51.4 2017 charges 9.7 — 9.7 Adjustments (2.1 ) 1.4 (.7 ) Cash payments (9.0 ) (.5 ) (9.5 ) Foreign exchange .5 — .5 Balance at March 31, 2017 $ 47.7 $ 3.7 $ 51.4 |
Restructuring and Related Costs | The following table presents the restructuring charges incurred to date, under the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plan: Employee- Related Costs Inventory Write-offs Foreign Currency Translation Adjustment Write-offs Contract Terminations/Other Total Charges incurred to-date $ 91.6 $ .4 $ 2.7 $ 10.1 $ 104.8 Estimated charges to be incurred on approved initiatives 6.2 — — 1.2 7.4 Total expected charges on approved initiatives $ 97.8 $ .4 $ 2.7 $ 11.3 $ 112.2 |
Schedule of Restructuring Charges Reportable by Business Segment | The charges, net of adjustments, of initiatives under the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plan, by reportable segment are as follows: Europe, Middle East & Africa South Latin America North Latin America Asia Pacific Global & Other Operating Segments Total 2015 $ — $ — $ — $ — $ 21.4 $ 21.4 2016 30.9 13.2 4.4 11.7 14.2 74.4 First quarter 2017 3.0 2.7 (.1 ) (.5 ) 3.9 9.0 Charges incurred to-date 33.9 15.9 4.3 11.2 39.5 104.8 Estimated charges to be incurred on approved initiatives 1.2 — — — 6.2 7.4 Total expected charges on approved initiatives $ 35.1 $ 15.9 $ 4.3 $ 11.2 $ 45.7 $ 112.2 |
GOODWILL (Tables)
GOODWILL (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Goodwill Europe, Middle East & Africa South Latin America Asia Pacific Total Gross balance at December 31, 2016 $ 25.6 $ 72.3 $ 85.0 $ 182.9 Accumulated impairments (6.9 ) — (82.4 ) (89.3 ) Net balance at December 31, 2016 $ 18.7 $ 72.3 $ 2.6 $ 93.6 Changes during the period ended March 31, 2017: Foreign exchange .5 3.0 — 3.5 Gross balance at March 31, 2017 $ 26.1 $ 75.3 $ 85.0 $ 186.4 Accumulated impairments (6.9 ) — (82.4 ) (89.3 ) Net balance at March 31, 2017 $ 19.2 $ 75.3 $ 2.6 $ 97.1 |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Assets and Liabilities Measured at Fair Value on a Recurring Basis | Assets and Liabilities Recorded at Fair Value on a Recurring Basis The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of March 31, 2017 : Level 1 Level 2 Total Assets: Available-for-sale securities $ 2.8 $ — $ 2.8 Foreign exchange forward contracts — .4 .4 Total $ 2.8 $ .4 $ 3.2 Liabilities: Foreign exchange forward contracts $ — $ .3 $ .3 Total $ — $ .3 $ .3 The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of December 31, 2016 : Level 1 Level 2 Total Assets: Available-for-sale securities $ 2.8 $ — $ 2.8 Foreign exchange forward contracts — .6 .6 Total $ 2.8 $ .6 $ 3.4 Liabilities: Foreign exchange forward contracts $ — $ 3.0 $ 3.0 Total $ — $ 3.0 $ 3.0 |
Fair Value of Financial Instruments | The net asset (liability) amounts recorded in the balance sheet (carrying amount) and the estimated fair values of our remaining financial instruments at March 31, 2017 and December 31, 2016 , respectively, consisted of the following: March 31, 2017 December 31, 2016 Carrying Amount Fair Value Carrying Amount Fair Value Available-for-sale securities $ 2.8 $ 2.8 $ 2.8 $ 2.8 Debt maturing within one year (1) (20.1 ) (20.1 ) (18.1 ) (18.1 ) Long-term debt (1) (1,874.9 ) (1,880.8 ) (1,875.8 ) (1,877.5 ) Foreign exchange forward contracts .1 .1 (2.4 ) (2.4 ) (1) The carrying value of debt maturing within one year and long-term debt is presented net of debt issuance costs and includes any related discount or premium and unamortized deferred gains on terminated interest-rate swap agreements, as applicable. |
DERIVATIVE INSTRUMENTS AND HE37
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
General Discussion of Derivative Instruments and Hedging Activities [Abstract] | |
Fair Value of Derivative Instruments Outstanding | Derivatives are recognized in the Consolidated Balance Sheets at their fair values. The following table presents the fair value of derivative instruments outstanding at March 31, 2017 : Asset Liability Balance Sheet Classification Fair Value Balance Sheet Classification Fair Value Derivatives not designated as hedges: Foreign exchange forward contracts Prepaid expenses and other $ .4 Accounts payable $ .3 Total derivatives not designated as hedges $ .4 $ .3 Total derivatives $ .4 $ .3 The following table presents the fair value of derivative instruments outstanding at December 31, 2016 : Asset Liability Balance Sheet Classification Fair Value Balance Sheet Classification Fair Value Derivatives not designated as hedges: Foreign exchange forward contracts Prepaid expenses and other $ .6 Accounts payable $ 3.0 Total derivatives not designated as hedges $ .6 $ 3.0 Total derivatives $ .6 $ 3.0 |
ACCOUNTING POLICIES (Details)
ACCOUNTING POLICIES (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Accounting Policies [Line Items] | |||
Loss from deconsolidation of Venezuela | $ 0 | $ 120.5 | |
Operating Income (Loss) [Member] | |||
Accounting Policies [Line Items] | |||
Impact of new pension guidance | $ 2.1 | ||
Operating Income (Loss) [Member] | Accounting Standards Update 2017-07 [Member] | |||
Accounting Policies [Line Items] | |||
Impact of new pension guidance | $ 0.9 | ||
Avon Venezuela [Member] | |||
Accounting Policies [Line Items] | |||
Net assets of the Venezuelan business | 39.2 | ||
Loss from foreign currency translation adjustments | 81.3 | ||
Avon Venezuela [Member] | Inventories [Member] | |||
Accounting Policies [Line Items] | |||
Net assets of the Venezuelan business | 23.7 | ||
Avon Venezuela [Member] | Property, Plant and Equipment, Type [Domain] | |||
Accounting Policies [Line Items] | |||
Net assets of the Venezuelan business | 15 | ||
Avon Venezuela [Member] | Other Noncurrent Assets [Member] | |||
Accounting Policies [Line Items] | |||
Net assets of the Venezuelan business | 11.4 | ||
Avon Venezuela [Member] | Cash [Member] | |||
Accounting Policies [Line Items] | |||
Net assets of the Venezuelan business | 4.5 | ||
Avon Venezuela [Member] | Accounts Receivable [Member] | |||
Accounting Policies [Line Items] | |||
Net assets of the Venezuelan business | 4.6 | ||
Avon Venezuela [Member] | Accrued Liabilities [Member] | |||
Accounting Policies [Line Items] | |||
Net assets of the Venezuelan business | 20 | ||
Avon Venezuela [Member] | Other Expense, Net [Member] | |||
Accounting Policies [Line Items] | |||
Loss from deconsolidation of Venezuela | $ 120.5 | ||
Scenario, Previously Reported [Member] | |||
Accounting Policies [Line Items] | |||
Cash paid for interest, prior to reclassification | 87.1 | ||
Scenario, after revision [Member] | |||
Accounting Policies [Line Items] | |||
Cash paid for interest, prior to reclassification | $ 142.8 |
EARNINGS (LOSS) PER SHARE AND39
EARNINGS (LOSS) PER SHARE AND SHARE REPURCHASES (Narrative) (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Earnings Per Share Reconciliation [Abstract] | ||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 13.1 | 11 |
Converted Series C Convertible Preferred Stock (in shares) | 87.1 | 87.1 |
Stock repurchased during the period, shares | 1.4 | 0.9 |
Stock repurchased during the period, value | $ 6.2 | $ 3.5 |
EARNINGS (LOSS) PER SHARE AND40
EARNINGS (LOSS) PER SHARE AND SHARE REPURCHASES (Components of Basic and Diluted Earnings per Share) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Numerator from continuing operations: [Abstract] | ||
Loss from continuing operations, less amounts attributable to noncontrolling interests | $ (36.5) | $ (156.3) |
Less: Loss allocated to participating securities | 0.5 | 1.9 |
Less: Earnings allocated to convertible preferred stock | 5.7 | 1.8 |
Loss from continuing operations allocated to common shareholders | (41.7) | (156.2) |
Numerator from discontinued operations: | ||
Loss from discontinued operations | 0 | (9.6) |
Less: Loss allocated to participating securities | 0 | 0.1 |
Loss allocated to common shareholders | 0 | (9.5) |
Numerator attributable to Avon: | ||
Net loss attributable to Avon | (36.5) | (165.9) |
Less: Loss allocated to participating securities | 0.5 | 2 |
Less: Earnings allocated to convertible preferred stock | 5.7 | 1.8 |
Loss allocated to common shareholders | $ (36) | $ (165.7) |
Denominator: | ||
Basic EPS weighted-average shares outstanding | 438.6 | 435.9 |
Diluted effect of assumed conversion of stock options (in shares) | 0 | 0 |
Diluted effect of assumed conversion of preferred stock (in shares) | 0 | |
Diluted EPS adjusted weighted-average shares outstanding | 438.6 | 435.9 |
Loss per Common Share from continuing operations: | ||
Basic (in usd per share) | $ (0.10) | $ (0.36) |
Diluted (in usd per share) | (0.10) | (0.36) |
Loss per Common Share from discontinued operations: | ||
Basic (in usd per share) | 0 | (0.02) |
Diluted (in usd per share) | 0 | (0.02) |
Loss per Common Share attributable to Avon: | ||
Basic (in usd per share) | (0.10) | (0.36) |
Diluted (in usd per share) | $ (0.10) | $ (0.36) |
DISCONTINUED OPERATIONS - Addit
DISCONTINUED OPERATIONS - Additional Information (Details) $ in Millions | Dec. 17, 2015USD ($) |
North America Segment [Member] | Discontinued Operations [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Proceeds from issuance of convertible preferred stock | $ 435 |
DISCONTINUED OPERATIONS - Major
DISCONTINUED OPERATIONS - Major Classes of Financial Statement Components Comprising the Loss on Discontinued Operations, Net of Tax in North America (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Loss from discontinued operations, net of tax | $ 0 | $ (9.6) |
North America Segment [Member] | Discontinued Operations [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Total revenue | 135.2 | |
Cost of sales | 53.2 | |
Selling, general and administrative expenses | 87.8 | |
Operating loss | (5.8) | |
Other income items | 0.6 | |
Loss on sale of discontinued operations, before tax | (5.2) | |
Loss on sale of discontinued operations, before tax | (14.9) | |
Income taxes | 10.5 | |
Loss from discontinued operations, net of tax | $ (9.6) |
INVESTMENT IN NEW AVON (Details
INVESTMENT IN NEW AVON (Details) - USD ($) $ in Millions | Dec. 17, 2015 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 |
Schedule of Equity Method Investments [Line Items] | |||||
Other comprehensive income related to New Avon investment, net of taxes of $0.0 | $ 1.1 | $ 0 | |||
Investment in New Avon | 29.4 | $ 32.8 | |||
Equity Method Investment, Summarized Financial Information, Revenue | $ 88.8 | 176.8 | |||
Equity Method Investment, Summarized Financial Information, Gross Profit (Loss) | 53.4 | 110.2 | |||
Equity Method Investment, Summarized Financial Information, Net Income (Loss) | $ (19.6) | (20.3) | |||
New Avon [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Other comprehensive income related to New Avon investment, net of taxes of $0.0 | 1.1 | ||||
North America Segment [Member] | Discontinued Operations [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Percentage of ownership interest retained | 19.90% | ||||
Other Expense, Net [Member] | New Avon [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Income (Loss) from Equity Method Investments | (4) | $ (3.9) | |||
Equity method investment, income (loss) from purchase accounting | $ (0.5) |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Millions | Mar. 01, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | |||||
Dividend rate | 1.25% | ||||
Dividends, Preferred Stock | $ 0 | ||||
Related Party, Inventory | [1] | 0.8 | $ 1 | ||
Receivables due from New Avon(6) | [2] | 6.8 | 11.6 | ||
Equity Method Investee [Member] | |||||
Related Party Transaction [Line Items] | |||||
Selling, general and administrative expenses | 7.1 | $ 3.9 | |||
Standby letters of credit, recorded liability | 1.6 | 2.1 | |||
Equity Method Investee [Member] | Transition Services Agreement [Member] | |||||
Related Party Transaction [Line Items] | |||||
Revenue from sale of product to New Avon(1) | 8 | 3.7 | |||
Selling, general and administrative expenses | [3] | 7.9 | 3.9 | ||
Equity Method Investee [Member] | Manufacturing and Supply Agreement [Member] | |||||
Related Party Transaction [Line Items] | |||||
Revenue from sale of product to New Avon(1) | [4] | 8 | 3.7 | ||
Gross profit from sale of product to New Avon(1) | [4] | 0.6 | 0.5 | ||
Cost of sales for purchases from New Avon(2) | [5] | 0.8 | 0.9 | ||
Purchases from related party supply agreement | 1 | 1.2 | |||
Equity Method Investee [Member] | Project Management Agreement [Member] | |||||
Related Party Transaction [Line Items] | |||||
Selling, general and administrative expenses | [6] | (0.8) | $ 0 | ||
New Avon [Member] | |||||
Related Party Transaction [Line Items] | |||||
Payable to discontinued operations | [7] | 0.4 | 0.7 | ||
Affiliate of Cerberus [Member] | |||||
Related Party Transaction [Line Items] | |||||
Payable to discontinued operations | [8] | 0.6 | $ 0.6 | ||
Transformation Plan [Member] | |||||
Related Party Transaction [Line Items] | |||||
Selling, general and administrative expenses | $ (0.8) | ||||
Series C Preferred Stock [Member] | |||||
Related Party Transaction [Line Items] | |||||
Shares issued | 435,000 | ||||
Shares issued, value | $ 435 | ||||
[1] | Inventories relate to purchases from New Avon, associated with the manufacturing and supply agreement, which have not yet been sold, and were classified within inventories in the Consolidated Balance Sheets. | ||||
[2] | The receivables due from New Avon relate to the agreements for transition services, research and development and subleases for office space, as well as the manufacturing and supply agreement, and were classified within prepaid expenses and other in the Consolidated Balance Sheets. | ||||
[3] | The Company also entered into a transition services agreement to provide certain services to New Avon, as well as an agreement for research and development and subleases for office space. In addition, New Avon is performing certain services for the Company under a similar transition services agreement. The Company recorded a net $7.9 and $3.9 reduction of selling, general and administrative expenses associated with these agreements during the three months ended March 31, 2017 and 2016, respectively, which generally represents a recovery of the related costs. | ||||
[4] | The Company supplies product to New Avon as part of a manufacturing and supply agreement. The Company recorded revenue of $8.0 and $3.7, within other revenue, and gross profit of $.6 and $.5 associated with this agreement during the three months ended March 31, 2017 and 2016, respectively. | ||||
[5] | New Avon also supplies product to the Company as part of this manufacturing and supply agreement. The Company purchased $1.0 and $1.2 from New Avon associated with this agreement during the three months ended March 31, 2017 and 2016, respectively, and recorded $.8 and $.9 associated with these purchases within cost of sales during the three months ended March 31, 2017 and 2016, respectively. | ||||
[6] | The Company also entered into agreements with an affiliate of Cerberus, which provide for the secondment of Cerberus affiliate personnel to the Company's project management team responsible for assisting with the execution of the transformation plan (the "Transformation Plan") announced in January 2016. The Company recorded $.8 in selling, general and administrative expenses associated with these agreements during the three months ended March 31, 2017. See Note 12, Restructuring Initiatives for additional information related to the Transformation Plan. | ||||
[7] | The payables due to New Avon relate to the manufacturing and supply agreement, and were classified within other accrued liabilities in the Consolidated Balance Sheets. | ||||
[8] | The payables due to an affiliate of Cerberus relate to the agreement for the project management team, and were classified within other accrued liabilities in the Consolidated Balance Sheets. |
INVENTORIES (Components of Inve
INVENTORIES (Components of Inventories) (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Inventory [Line Items] | ||
Raw materials | $ 194.3 | $ 179.3 |
Finished goods | 436.1 | 407.1 |
Total | $ 630.4 | $ 586.4 |
EMPLOYEE BENEFIT PLANS (Compone
EMPLOYEE BENEFIT PLANS (Components of Net Periodic Benefit Cost) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Pension Benefits U.S. Plans [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | $ 1.4 | $ 2.3 | |
Interest cost | 0.7 | 4.3 | |
Expected return on plan assets | (0.8) | (5.2) | |
Amortization of prior service credit | 0 | (0.1) | |
Amortization of net actuarial losses | 1.2 | 6.1 | |
Settlements/curtailments | 0 | 0.1 | |
Net periodic benefit costs | [1] | 2.5 | 7.5 |
Pension Benefits Non-U.S. Plans [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | 1.2 | 1.3 | |
Interest cost | 4.4 | 6 | |
Expected return on plan assets | (6.7) | (8.8) | |
Amortization of prior service credit | 0 | 0 | |
Amortization of net actuarial losses | 1.8 | 1.7 | |
Settlements/curtailments | 0 | 0 | |
Net periodic benefit costs | [1] | 0.7 | 0.2 |
Postretirement Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | 0 | 0.1 | |
Interest cost | 0.4 | 0.6 | |
Expected return on plan assets | 0 | 0 | |
Amortization of prior service credit | (0.1) | (0.9) | |
Amortization of net actuarial losses | 0 | 0.2 | |
Settlements/curtailments | 0 | 0 | |
Net periodic benefit costs | [1] | $ 0.3 | 0 |
Discontinued Operations [Member] | Pension Benefits U.S. Plans [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Net periodic benefit costs | $ 4.4 | ||
[1] | Includes $4.4 of U.S. pension and immaterial amounts of the postretirement benefit plans (related to the U.S.) for the three months ended March 31, 2016, which are included in discontinued operations. Amounts associated with the pension and postretirement benefit plans in Canada and the postretirement benefit plan in Puerto Rico, which are included in discontinued operations, have been excluded from all amounts in the table above. See Note 3, Discontinued Operations for discussion of the separation of the Company's North America business. |
EMPLOYEE BENEFIT PLANS (Narrati
EMPLOYEE BENEFIT PLANS (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
United States Pension Plan of US Entity, Defined Benefit [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Net periodic benefit costs | [1] | $ 2.5 | $ 7.5 |
Postretirement Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Net periodic benefit costs | [1] | 0.3 | 0 |
Discontinued Operations [Member] | United States Pension Plan of US Entity, Defined Benefit [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Net periodic benefit costs | $ 4.4 | ||
UNITED STATES | Minimum [Member] | Postretirement Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Estimated contributions for the remainder of fiscal year | 10 | ||
UNITED STATES | Maximum [Member] | Postretirement Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Estimated contributions for the remainder of fiscal year | 15 | ||
Non-US [Member] | Postretirement Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Employer contribution | 5 | ||
Non-US [Member] | Minimum [Member] | Postretirement Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Estimated contributions for the remainder of fiscal year | 15 | ||
Non-US [Member] | Maximum [Member] | Postretirement Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Estimated contributions for the remainder of fiscal year | $ 20 | ||
[1] | Includes $4.4 of U.S. pension and immaterial amounts of the postretirement benefit plans (related to the U.S.) for the three months ended March 31, 2016, which are included in discontinued operations. Amounts associated with the pension and postretirement benefit plans in Canada and the postretirement benefit plan in Puerto Rico, which are included in discontinued operations, have been excluded from all amounts in the table above. See Note 3, Discontinued Operations for discussion of the separation of the Company's North America business. |
CONTINGENCIES (Details)
CONTINGENCIES (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2017 | |
Loss Contingencies [Line Items] | ||||
Judicial Deposit | $ 69 | $ 74.4 | ||
Assessment for 2012 [Member] | ||||
Loss Contingencies [Line Items] | ||||
Assessment of contingencies, including penalties and accruing interest | 352 | |||
Assessment for 2002 [Member] | ||||
Loss Contingencies [Line Items] | ||||
Assessment of contingencies, including penalties and accruing interest, reduced | 30 | |||
Assessment of contingencies, prior to reductions | 71 | |||
IPI Tax on Cosmetics [Member] | ||||
Loss Contingencies [Line Items] | ||||
Estimated Litigation Liability | 148 | |||
Judicial Deposit | 74 | |||
Net IPI liability | $ 74 | |||
ERISA [Member] | ||||
Loss Contingencies [Line Items] | ||||
Litigation Settlement, Amount | 6 | |||
Insurance Settlements Receivable, Current | 5 | |||
Payments for legal settlements | $ 1 | |||
DOJ [Member] | FCPA [Member] | ||||
Loss Contingencies [Line Items] | ||||
Litigation Settlement, Amount | $ 68 | |||
SEC [Member] | FCPA [Member] | ||||
Loss Contingencies [Line Items] | ||||
Litigation Settlement, Amount | $ 67 |
ACCUMULATED OTHER COMPREHENSI49
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) Tables (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Other comprehensive (loss) income other than reclassifications | $ 63 | $ 11.2 | |
Reclassifications into earnings: | |||
Amortization of net actuarial loss and prior service cost, net of tax | [1] | 3.1 | |
Deconsolidation of Venezuela, net of tax of $0.0 | 0 | 120.5 | |
Total reclassifications into earnings | 3.1 | ||
Balance at Period Start | (1,033.2) | (1,366.2) | |
Balance at Period End | (967.1) | (1,006.6) | |
Change in derivative losses on cash flow hedges, tax | 0 | 0 | |
Amortization of net actuarial loss and prior service cost, tax | 0 | 0.2 | |
Other comprehensive income, equity method investment, tax | 0 | ||
Foreign Currency Gain (Loss) [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Other comprehensive (loss) income other than reclassifications | 61.9 | 23.9 | |
Reclassifications into earnings: | |||
Balance at Period Start | (910.9) | (950) | |
Balance at Period End | (849) | (854.8) | |
Cash Flow Hedging [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Other comprehensive (loss) income other than reclassifications | 0 | ||
Reclassifications into earnings: | |||
Balance at Period Start | (1.3) | ||
Balance at Period End | (0.9) | ||
Net Investment Hedging [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Other comprehensive (loss) income other than reclassifications | 0 | 0 | |
Reclassifications into earnings: | |||
Balance at Period Start | (4.3) | (4.3) | |
Balance at Period End | (4.3) | (4.3) | |
Accumulated Defined Benefit Plans Adjustment [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Other comprehensive (loss) income other than reclassifications | 0 | (12.7) | |
Reclassifications into earnings: | |||
Balance at Period Start | (120.2) | (410.6) | |
Balance at Period End | (117.1) | (146.6) | |
Equity Method Investments [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Other comprehensive (loss) income other than reclassifications | 1.1 | ||
Reclassifications into earnings: | |||
Balance at Period Start | 2.2 | ||
Balance at Period End | 3.3 | ||
Reclassification out of Accumulated Other Comprehensive Income [Member] | |||
Reclassifications into earnings: | |||
Derivative losses on cash flow hedges, net of tax of $0.0(1) | [2] | 0.4 | |
Amortization of net actuarial loss and prior service cost, net of tax | [1] | 6.7 | |
Deconsolidation of Venezuela, net of tax of $0.0 | 82.1 | ||
Separation of North America, net of tax of $10.2 | 259.2 | ||
Total reclassifications into earnings | 348.4 | ||
Reclassification out of Accumulated Other Comprehensive Income [Member] | Foreign Currency Gain (Loss) [Member] | |||
Reclassifications into earnings: | |||
Derivative losses on cash flow hedges, net of tax of $0.0(1) | [2] | 0 | |
Amortization of net actuarial loss and prior service cost, net of tax | [1] | 0 | 0 |
Deconsolidation of Venezuela, net of tax of $0.0 | 81.3 | ||
Separation of North America, net of tax of $10.2 | (10) | ||
Total reclassifications into earnings | 0 | 71.3 | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Cash Flow Hedging [Member] | |||
Reclassifications into earnings: | |||
Derivative losses on cash flow hedges, net of tax of $0.0(1) | [2] | 0.4 | |
Amortization of net actuarial loss and prior service cost, net of tax | [1] | 0 | |
Deconsolidation of Venezuela, net of tax of $0.0 | 0 | ||
Separation of North America, net of tax of $10.2 | 0 | ||
Total reclassifications into earnings | 0.4 | ||
Reclassification out of Accumulated Other Comprehensive Income [Member] | Net Investment Hedging [Member] | |||
Reclassifications into earnings: | |||
Derivative losses on cash flow hedges, net of tax of $0.0(1) | [2] | 0 | |
Amortization of net actuarial loss and prior service cost, net of tax | [1] | 0 | 0 |
Deconsolidation of Venezuela, net of tax of $0.0 | 0 | ||
Separation of North America, net of tax of $10.2 | 0 | ||
Total reclassifications into earnings | 0 | 0 | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Accumulated Defined Benefit Plans Adjustment [Member] | |||
Reclassifications into earnings: | |||
Derivative losses on cash flow hedges, net of tax of $0.0(1) | [2] | 0 | |
Amortization of net actuarial loss and prior service cost, net of tax | [1] | 3.1 | 6.7 |
Deconsolidation of Venezuela, net of tax of $0.0 | 0.8 | ||
Separation of North America, net of tax of $10.2 | 269.2 | ||
Total reclassifications into earnings | 3.1 | 276.7 | |
Separation of North America, tax | $ 10.2 | ||
Reclassification out of Accumulated Other Comprehensive Income [Member] | Equity Method Investments [Member] | |||
Reclassifications into earnings: | |||
Amortization of net actuarial loss and prior service cost, net of tax | [1] | 0 | |
Total reclassifications into earnings | $ 0 | ||
[1] | Gross amount reclassified to pension and postretirement expense, within selling, general & administrative expenses, and related taxes reclassified to income taxes. | ||
[2] | Gross amount reclassified to interest expense, and related taxes reclassified to income taxes. |
ACCUMULATED OTHER COMPREHENSI50
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||
Foreign Exchange Gains (Losses) From Translation Of Actuarial Losses Prior Service Credit And Transition Obligation | $ 3.4 | $ (1.2) |
SEGMENT INFORMATION (Total Reve
SEGMENT INFORMATION (Total Revenue and Operating Profit by Reporting Segment) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Segment Reporting Information [Line Items] | ||
Revenue | $ 1,333.1 | $ 1,306.5 |
Operating Profit | 28.7 | 7.8 |
Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenue | 1,324.1 | 1,286.1 |
Operating Profit | 121.8 | 135.1 |
Other Operating Segments and Business Activities [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenue | 9 | 20.4 |
Operating Profit | 1.2 | 4.1 |
Corporate, Non-Segment [Member] | ||
Segment Reporting Information [Line Items] | ||
Unallocated global expenses | (84.3) | (84.6) |
CTI restructuring initiatives | (10) | (46.8) |
Europe Middle East & Africa [Member] | Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenue | 507.5 | 520.4 |
Operating Profit | 74.6 | 68.7 |
South Latin America [Member] | Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenue | 499.2 | 426.4 |
Operating Profit | 13.3 | 23.1 |
North Latin America [Member] | Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenue | 193.2 | 204.7 |
Operating Profit | 21 | 28.5 |
Asia Pacific [Member] | Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenue | 124.2 | 134.6 |
Operating Profit | $ 12.9 | $ 14.8 |
SUPPLEMENTAL BALANCE SHEET IN52
SUPPLEMENTAL BALANCE SHEET INFORMATION (Components of Prepaid Expenses and Other) (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Prepaid taxes and tax refunds receivable | $ 114.3 | $ 99.3 |
Prepaid brochure costs, paper and other literature | 78.1 | 73.2 |
Receivables other than trade | 55 | 68.3 |
Other | 52.8 | 50.5 |
Prepaid expenses and other | $ 300.2 | $ 291.3 |
SUPPLEMENTAL BALANCE SHEET IN53
SUPPLEMENTAL BALANCE SHEET INFORMATION (Components of Other Assets) (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Other Assets, Noncurrent [Abstract] | ||
Deferred tax assets | $ 162.8 | $ 162.1 |
Long-term receivables | 89.6 | 78.9 |
Judicial deposits other than Brazil IPI tax (see below) | 85.7 | 78 |
Capitalized software | 83.3 | 83.9 |
Judicial deposit for Brazil IPI tax on cosmetics (Note 8) | 74.4 | 69 |
Net overfunded pension plans | 59.7 | 54.8 |
Trust assets associated with supplemental benefit plans | 35.9 | 35.2 |
Investment in New Avon (Note 4) | 29.4 | 32.8 |
Tooling (plates and molds associated with our beauty products) | 14.5 | 14.7 |
Other | 12 | 12.3 |
Other assets | $ 647.3 | $ 621.7 |
RESTRUCTURING INITIATIVES (Narr
RESTRUCTURING INITIATIVES (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Transformation Plan [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Expected annualized savings before taxes | $ 350 | |
Number of years to realized cost savings | 3 years | |
Recorded total costs to implement restructuring initiatives | $ 116.1 | |
Restructuring charges and other costs | 10 | $ 47.5 |
Accelerated depreciation | 0.5 | |
Transformation Plan [Member] | Employee-Related Costs [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges and other costs | 7.6 | 47.1 |
Transformation Plan [Member] | Contract Terminations/ Other [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges and other costs | 1.4 | |
Transformation Plan [Member] | Professional Service Fees [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges and other costs | 0.5 | 0.4 |
Transformation Plan [Member] | Minimum [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Additional charges not yet incurred associated with the restructuring actions approved to-date | 10 | |
Total expected costs to implement restructuring on approved initiatives | 125 | |
Transformation Plan [Member] | Maximum [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Additional charges not yet incurred associated with the restructuring actions approved to-date | 15 | |
Total expected costs to implement restructuring on approved initiatives | 130 | |
Transformation Plan [Member] | Supply Chain [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Expected annualized savings before taxes | 200 | |
Transformation Plan [Member] | Other Costs [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Expected annualized savings before taxes | 150 | |
Other Restructuring Initiatives [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges and other costs | $ (0.7) | |
Selling, General and Administrative Expenses [Member] | Transformation Plan [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges and other costs | 10.1 | |
Cost of Sales [Member] | Transformation Plan [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges and other costs | $ (0.1) |
RESTRUCTURING INITIATIVES RESTR
RESTRUCTURING INITIATIVES RESTRUCTURING INITIATIVES (Liability Balances) (Details) - Transformation Plan [Member] $ in Millions | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Restructuring Reserve [Roll Forward] | |
Balance at December 31, 2016 | $ 51.4 |
2017 charges | 9.7 |
Adjustments | (0.7) |
Cash payments | (9.5) |
Foreign exchange | 0.5 |
Balance at March 31, 2017 | 51.4 |
Employee-Related Costs [Member] | |
Restructuring Reserve [Roll Forward] | |
Balance at December 31, 2016 | 48.6 |
2017 charges | 9.7 |
Adjustments | (2.1) |
Cash payments | (9) |
Foreign exchange | 0.5 |
Balance at March 31, 2017 | 47.7 |
Contract Terminations/ Other [Member] | |
Restructuring Reserve [Roll Forward] | |
Balance at December 31, 2016 | 2.8 |
2017 charges | 0 |
Adjustments | 1.4 |
Cash payments | (0.5) |
Foreign exchange | 0 |
Balance at March 31, 2017 | $ 3.7 |
RESTRUCTURING INITIATIVES Res56
RESTRUCTURING INITIATIVES Restructuring Initiatives by Charge Type (Details) - Transformation Plan [Member] $ in Millions | Mar. 31, 2017USD ($) |
Restructuring Cost and Reserve [Line Items] | |
Charges incurred to-date | $ 104.8 |
Estimated charges to be incurred on approved initiatives | 7.4 |
Total expected charges on approved initiatives | 112.2 |
Employee-Related Costs [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Charges incurred to-date | 91.6 |
Estimated charges to be incurred on approved initiatives | 6.2 |
Total expected charges on approved initiatives | 97.8 |
Inventory Write Offs [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Charges incurred to-date | 0.4 |
Estimated charges to be incurred on approved initiatives | 0 |
Total expected charges on approved initiatives | 0.4 |
Contract Terminations/ Other [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Charges incurred to-date | 10.1 |
Estimated charges to be incurred on approved initiatives | 1.2 |
Total expected charges on approved initiatives | 11.3 |
Accumulated Foreign Currency Adjustment Write-offs [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Charges incurred to-date | 2.7 |
Estimated charges to be incurred on approved initiatives | 0 |
Total expected charges on approved initiatives | $ 2.7 |
RESTRUCTURING INITIATIVES RES57
RESTRUCTURING INITIATIVES RESTRUCTURING INITIATIVES (Charges Reportable by Business Segment) (Details) - Transformation Plan [Member] - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Restructuring Cost and Reserve [Line Items] | |||
Charges incurred | $ 9 | $ 74.4 | $ 21.4 |
Charges incurred to-date | 104.8 | ||
Estimated charges to be incurred on approved initiatives | 7.4 | ||
Total expected charges on approved initiatives | 112.2 | ||
Europe Middle East & Africa [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges incurred | 3 | 30.9 | 0 |
Charges incurred to-date | 33.9 | ||
Estimated charges to be incurred on approved initiatives | 1.2 | ||
Total expected charges on approved initiatives | 35.1 | ||
South Latin America [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges incurred | 2.7 | 13.2 | 0 |
Charges incurred to-date | 15.9 | ||
Estimated charges to be incurred on approved initiatives | 0 | ||
Total expected charges on approved initiatives | 15.9 | ||
North Latin America [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges incurred | (0.1) | 4.4 | 0 |
Charges incurred to-date | 4.3 | ||
Estimated charges to be incurred on approved initiatives | 0 | ||
Total expected charges on approved initiatives | 4.3 | ||
Asia Pacific [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges incurred | (0.5) | 11.7 | 0 |
Charges incurred to-date | 11.2 | ||
Estimated charges to be incurred on approved initiatives | 0 | ||
Total expected charges on approved initiatives | 11.2 | ||
Global and Other Operating Segments [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges incurred | 3.9 | $ 14.2 | $ 21.4 |
Charges incurred to-date | 39.5 | ||
Estimated charges to be incurred on approved initiatives | 6.2 | ||
Total expected charges on approved initiatives | $ 45.7 |
GOODWILL (Schedule of Goodwill)
GOODWILL (Schedule of Goodwill) (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Goodwill [Line Items] | |
Gross balance at Period Start | $ 182.9 |
Accumulated impairments | (89.3) |
Net balance at Period Start | 93.6 |
Foreign exchange | 3.5 |
Gross balance at Period End | 186.4 |
Accumulated impairments | (89.3) |
Net balance at Period End | 97.1 |
Europe Middle East & Africa [Member] | |
Goodwill [Line Items] | |
Gross balance at Period Start | 25.6 |
Accumulated impairments | (6.9) |
Net balance at Period Start | 18.7 |
Foreign exchange | 0.5 |
Gross balance at Period End | 26.1 |
Accumulated impairments | (6.9) |
Net balance at Period End | 19.2 |
South Latin America [Member] | |
Goodwill [Line Items] | |
Gross balance at Period Start | 72.3 |
Accumulated impairments | 0 |
Net balance at Period Start | 72.3 |
Foreign exchange | 3 |
Gross balance at Period End | 75.3 |
Accumulated impairments | 0 |
Net balance at Period End | 75.3 |
Asia Pacific [Member] | |
Goodwill [Line Items] | |
Gross balance at Period Start | 85 |
Accumulated impairments | (82.4) |
Net balance at Period Start | 2.6 |
Foreign exchange | 0 |
Gross balance at Period End | 85 |
Accumulated impairments | (82.4) |
Net balance at Period End | $ 2.6 |
FAIR VALUE (Fair Value Assets a
FAIR VALUE (Fair Value Assets and Liabilities Measured at Fair Value on a Recurring Basis) (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | $ 2.8 | $ 2.8 |
Total Assets | 3.2 | 3.4 |
Total Liabilities | 0.3 | 3 |
Foreign Exchange Forward Contracts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign exchange forward contracts, asset | 0.4 | 0.6 |
Foreign exchange forward contracts, liability | 0.3 | 3 |
Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 2.8 | 2.8 |
Total Assets | 2.8 | 2.8 |
Total Liabilities | 0 | 0 |
Level 1 [Member] | Foreign Exchange Forward Contracts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign exchange forward contracts, asset | 0 | 0 |
Foreign exchange forward contracts, liability | 0 | 0 |
Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 0 | 0 |
Total Assets | 0.4 | 0.6 |
Total Liabilities | 0.3 | 3 |
Level 2 [Member] | Foreign Exchange Forward Contracts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign exchange forward contracts, asset | 0.4 | 0.6 |
Foreign exchange forward contracts, liability | $ 0.3 | $ 3 |
FAIR VALUE (Fair Value of Finan
FAIR VALUE (Fair Value of Financial Instruments) (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Available-for-sale securities | $ 2.8 | $ 2.8 | |
Carrying Amount [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Available-for-sale securities | 2.8 | 2.8 | |
Debt maturing within one year | [1] | (20.1) | (18.1) |
Long-term debt | [1] | (1,874.9) | (1,875.8) |
Fair Value [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Available-for-sale securities | 2.8 | 2.8 | |
Debt maturing within one year | [1] | (20.1) | (18.1) |
Long-term debt | [1] | (1,880.8) | (1,877.5) |
Foreign Exchange Forward [Member] | Carrying Amount [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value, net asset (liability) | 0.1 | (2.4) | |
Foreign Exchange Forward [Member] | Fair Value [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value, net asset (liability) | $ 0.1 | $ (2.4) | |
[1] | The carrying value of debt maturing within one year and long-term debt is presented net of debt issuance costs and includes any related discount or premium and unamortized deferred gains on terminated interest-rate swap agreements, as applicable. |
DERIVATIVE INSTRUMENTS AND HE61
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Narrative) (Details) | 3 Months Ended | ||||
Mar. 31, 2017USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2016 | Jan. 31, 2013USD ($)derivative_instrument | Mar. 31, 2012USD ($)derivative_instrument | |
Derivative [Line Items] | |||||
Total exposure to floating rate interest rates | 1.00% | 1.00% | |||
Foreign Exchange Contract [Member] | |||||
Derivative [Line Items] | |||||
Notional amounts of foreign currency exchange contracts | $ 65,000,000 | ||||
Gain (Loss) on Foreign Currency Derivative Instruments Not Designated as Hedging Instruments | 500,000 | $ (2,300,000) | |||
Intercompany Loans [Member] | |||||
Derivative [Line Items] | |||||
Gain (loss) due to the effect of foreign currency exchange rates on intercompany loans | (1,200,000) | 800,000 | |||
January 2013 Interest-Rate Swap Termination [Member] | |||||
Derivative [Line Items] | |||||
Number of interest-rate swap agreements terminated | derivative_instrument | 8 | ||||
Notional Amount Related to Discontinuation of Interest Rate Fair Value Hedge | $ 1,000,000,000 | ||||
Deferred Gain (Loss) on Discontinuation of Interest Rate Fair Value Hedge | 0 | $ 90,400,000 | |||
Amortization of Interest Rate Swap Gains | 3,700,000 | ||||
March 2012 Interest-Rate Swap Termination [Member] | |||||
Derivative [Line Items] | |||||
Number of interest-rate swap agreements terminated | derivative_instrument | 2 | ||||
Notional Amount Related to Discontinuation of Interest Rate Fair Value Hedge | $ 350,000,000 | ||||
Deferred Gain (Loss) on Discontinuation of Interest Rate Fair Value Hedge | 9,700,000 | $ 46,100,000 | |||
Amortization of Interest Rate Swap Gains | $ 1,200,000 | $ 1,700,000 |
DERIVATIVE INSTRUMENTS AND HE62
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Fair Value of Derivative Instruments Outstanding) (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Derivatives, Fair Value [Line Items] | ||
Derivatives not designated as hedges, asset | $ 0.4 | $ 0.6 |
Derivatives not designated as hedges, liability | 0.3 | 3 |
Total derivatives, asset | 0.4 | 0.6 |
Total derivatives, liability | 0.3 | 3 |
Foreign Exchange Forward Contracts [Member] | Prepaid expenses and other [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives not designated as hedges, asset | 0.4 | 0.6 |
Foreign Exchange Forward Contracts [Member] | Accounts payable [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives not designated as hedges, liability | $ 0.3 | $ 3 |
Debt (Details)
Debt (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | |||||||
Nov. 30, 2016 | Aug. 31, 2016 | Aug. 31, 2015 | Mar. 31, 2017 | Dec. 31, 2016 | Aug. 01, 2016 | Mar. 31, 2013 | Mar. 31, 2008 | Mar. 31, 2003 | |
Debt Instrument [Line Items] | |||||||||
Amount outstanding under revolving credit facility | $ 0 | ||||||||
Revolving credit facility draw down amount without violating covenant | $ 356 | ||||||||
Repayments of Debt | $ 238.4 | $ 300.6 | |||||||
Debt Instrument, Repurchase Amount | $ 180.5 | ||||||||
Credit ratings | Our long-term credit ratings are: Moody’s ratings of Stable Outlook with B1 for corporate family debt, B3 for senior unsecured debt, and Ba1 for the Senior Secured Notes; S&P ratings of Positive Outlook with B for corporate family debt and senior unsecured debt and BB- for the Senior Secured Notes; and Fitch rating of Negative Outlook with B+, each of which are below investment grade. | ||||||||
Revolving Credit Facility [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of credit facility | $ 400 | ||||||||
Debt Instrument, Interest Rate Terms | Borrowings under the 2015 facility bear interest, at our option, at a rate per annum equal to LIBOR plus 250 basis points or a floating base rate plus 150 basis points, in each case subject to adjustment based upon a leverage-based pricing grid. | ||||||||
2013 Notes [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Interest Rate Terms | The indenture governing the 2013 Notes contains interest rate adjustment provisions depending on the long-term credit ratings assigned to the 2013 Notes with S&P and Moody's. As described in the indenture, the interest rates on the 2013 Notes increase by .25% for each one-notch downgrade below investment grade on each of our long-term credit ratings assigned to the 2013 Notes by S&P or Moody's. These adjustments are limited to a total increase of 2% above the respective interest rates in effect on the date of issuance of the 2013 Notes. | ||||||||
Six Point Five Percent Notes Due March Two Thousand Nineteen [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Face Amount | $ 350 | ||||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.50% | ||||||||
Notes Payable, Other Payables [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Covenant, Minimum Required Offer To Repurchase, Percentage Of Aggregate Principal Amount | 101.00% | ||||||||
Five Point Seven Five Percent Notes, Due March Two Thousand Eighteen [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.75% | ||||||||
Four Point Two Percent Notes, Due July Two Thousand Eighteen [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 4.20% | ||||||||
Two Point Three Seven Five Percent Notes, Due March Two Thousand Sixteen [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Face Amount | $ 250 | ||||||||
Debt Instrument, Interest Rate, Stated Percentage | 2.375% | ||||||||
Repayments of Debt | $ 250 | ||||||||
Four Point Six Zero Percent Notes, Due March Two Thousand Twenty [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Face Amount | $ 500 | ||||||||
Debt Instrument, Interest Rate, Stated Percentage | 4.60% | ||||||||
Five Point Zero Percent Notes, Due March Two Thousand Twenty-Three [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Face Amount | $ 500 | ||||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ||||||||
Six Point Nine Five Percent Notes, Due March Two Thousand Forty-Three [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Face Amount | $ 250 | ||||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.95% | ||||||||
Seven Point Eight Seven Five Percent Notes, Due August Two Thousand Twenty Two [Domain] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Face Amount | $ 500 | ||||||||
Debt Instrument, Interest Rate, Stated Percentage | 7.875% | ||||||||
AIO [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Standby letters of credit, recorded liability | $ 44 |