SEC Info℠  
    Home      Search      My Interests      Help      Sign In      Please Sign In

Avon Products Inc – ‘10-K/A’ for 12/31/99

On:  Monday, 8/12/02, at 2:08pm ET   ·   For:  12/31/99   ·   Accession #:  950103-2-801   ·   File #:  1-04881

Previous ‘10-K’:  ‘10-K’ on 3/18/02 for 12/31/01   ·   Next:  ‘10-K/A’ on 8/12/02 for 12/31/00   ·   Latest:  ‘10-K’ on 3/14/23 for 12/31/22

Find Words in Filings emoji
 		  in    Show  and   ↓Hints

  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 8/12/02  Avon Products Inc                 10-K/A     12/31/99    2:208K                                   Davis Polk & … LLP 01/FA

Amendment to Annual Report   —   Form 10-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-K/A      Amendment to Annual Report                            31    117K 
 2: EX-13       Annual or Quarterly Report to Security Holders        51    240K

10-K/A   —   Amendment to Annual Report
Document Table of Contents

Page (sequential) | (alphabetic) Top
 
11st Page   -   Filing Submission
4Item 1. Business
11Beauty Plus
13Item 2. Properties
14Item 3. Legal Proceedings
"Item 4. Submission of Matters to A Vote of Security Holders
16Item 5. Market for the Registrants Common Equity and Related Stockholder Matters
"Item 6. Selected Financial Data (Restated)
"Item 7. Management's Discussion and Analysis of Results of Operations and Financial Condition (Restated)
"Item 7A. Quantitative and Qualitative Disclosures About Market Risk
"Item 8. Financial Statements and Supplementary Data (Restated)
"Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
17Item 10. Directors and Executive Officers of the Registrant
"Item 11. Executive Compensation
"Item 12. Security Ownership of Certain Beneficial Owners and Management
"Item 13. Certain Relationships and Related Transactions 
10-K/A1st Page of 31TOC↑TopPreviousNext↓BottomJust 1st
 

FORM 10-K/A 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

[x] Annual Report Pursuant to Section 13 or 15(d) 
of the Securities Exchange Act of 1934    

For the fiscal year ended December 31, 1999 

OR

[ ] Transition Report Pursuant to Section 13 or 15(d) 
of the Securities Exchange Act of 1934
For the transition period from             to 

Commission file number 1-4881 

AVON PRODUCTS, INC. 
----------------------------------------------------------------  
(Exact name of registrant as specified in its charter)

New York                            13-0544597
----------------------------------------------------------------  
(State or other jurisdiction of            (I.R.S. Employer         
incorporation or organization)            Identification No.)     

1345 Avenue of the Americas, New York, N.Y. 10105-0196
(New address of principal executive offices)

(212) 282-5000
(Telephone number)

Securities registered pursuant to Section 12(b) of the Act:                     

                          Name of each exchange on
Title of each class                which registered                 
----------------------------------------------------------------                
Common stock (par value $.25)          New York Stock Exchange              
Preferred Share Purchase Rights        New York Stock Exchange              

Securities registered pursuant to Section 12(g) of the Act:  None               

Indicate by check mark whether the registrant (1) has filed all reports         
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of   
1934 during the preceding 12 months (or for such shorter period that the        
registrant was required to file such reports), and (2) has been subject to such 
filing requirements for the past 90 days. Yes X   No ___                        


10-K/A2nd Page of 31TOC1stPreviousNext↓BottomJust 2nd

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405  
of Regulation S-K is not contained herein, and will not be contained, to the    
best of registrant's knowledge, in definitive proxy or information statements   
incorporated by reference in Part III of this Form 10-K/A or any amendment to   
this Form 10-K/A. [ ].                                                          

The aggregate market value of Common Stock (par value $.25) held by   
non-affiliates at February 29, 2000 was $6.4 billion.                           

The number of shares of Common Stock (par value $.25) outstanding at  
February 29, 2000 was 237,514,173.                                              

Documents Incorporated by Reference 

Parts I and II     Portions of the 1999 Annual Report to Shareholders.          
Part III           Portions of the Proxy Statement for the 2000 Annual          
Meeting of Shareholders.                  


10-K/A3rd Page of 31TOC1stPreviousNext↓BottomJust 3rd

Introductory Note--Restatements                                                 

In connection with the settlement of the previously disclosed         
investigation by the Securities and Exchange Commission ("SEC") relating to the 
write off of an order management software system known as the "FIRST" project,  
Avon has restated its Consolidated Financial Statements as of December 31,      
2001, 2000 and 1999 and for the years then ended and for each of the fiscal     
quarters ended March 31, 1999 through March 31, 2002. Avon had written off      
$14.8 pretax, or $10.0 after tax, of FIRST assets in the first quarter of 1999  
and $23.9 pretax, or $14.5 after tax, of FIRST assets in the third quarter of   
2001. Avon has restated its financial statements to reflect the additional      
write off as of March 31, 1999 of all capitalized costs ($23.3 pretax, or $14.0 
after tax), associated with the FIRST project as of that date and a reversal of 
the charge recorded in the third quarter of 2001. Other FIRST-related activity  
(capitalized costs and amortization) recorded during 1999-2002 has also been    
restated. A description of the adjustments that comprise the restatements is    
set forth in Notes 2 and 15 of the Notes to Consolidated Financial Statements   
filed with this Form 10-K/A.                                                    

 The accompanying financial statements have been restated to reflect the
restatements discussed above as well as the accounting changes outlined in Note 
2. No attempt has been made in this Form 10-K/A to modify or update any         
disclosures except as required to reflect the results of the restatements       
discussed above and any changes made to prior period financial information for  
which a Form 10-K/A was not filed.                                              


10-K/A4th Page of 31TOC1stPreviousNext↓BottomJust 4th

PART I

ITEM 1. BUSINESS                                                                

Certain statements in this report which are not historical facts or   
information are forward-looking statements within the meaning of the Private    
Securities Litigation Reform Act of 1995, including, but not limited to, the    
information set forth herein. Such forward-looking statements involve known and 
unknown risks, uncertainties and other factors which may cause the actual       
results, levels of activity, performance or achievement of Avon Products, Inc.  
("Avon" or the "Company"), or industry results, to be materially different from 
any future results, levels of activity, performance or achievement expressed or 
implied by such forward-looking statements. Such factors include, among others, 
the following: General economic and business conditions; the ability of the     
Company to implement its business strategy; the Company's access to financing   
and its management of foreign currency risks; the Company's ability to          
successfully identify new business opportunities; the Company's ability to      
attract and retain key executives; the Company's ability to achieve anticipated 
cost savings and profitability targets; the impact of substantial currency      
exchange devaluations in the Company's principal foreign markets; changes in    
the industry; competition; the effect of regulatory and legal restrictions      
imposed by foreign governments; the effect of regulatory and legal proceedings  
and other factors as discussed in Item 1 of this Form 10-K/A. As a result of the
foregoing and other factors, no assurance can be given as to the future results 
and achievements of the Company. Neither the Company nor any other person       
assumes responsibility for the accuracy and completeness of these statements.   

General                                                                         

  The Company is one of the world's leading manufacturers and marketers of
beauty and related products, which include cosmetics, fragrance and toiletries  
(CFT); "beauty plus" which consists of jewelry and accessories and apparel; and 
"non-core" which consists of gift and decorative and home entertainment         
products. Avon commenced operations in 1886 and was incorporated in the State   
of New York on January 27, 1916. Avon's business is comprised of one industry   
segment, direct selling, which is conducted in North America, Latin America,    
the Pacific and Europe. The Company's reportable segments are based on          
geographic operations. Financial information relating to the reportable         
segments is incorporated by reference to the analysis of net sales and          
operating profit by geographic area and to Note 12 of the Notes to the          
Consolidated Financial Statements in Avon's 1999 Restated Annual Report to      
Shareholders.                                                                   

Business Process Redesign                                                       

In October 1997, the Company announced a worldwide business process   
redesign ("BPR") program to streamline operations and improve profitability     
through margin improvement and expense reductions. The                          

-1- 


10-K/A5th Page of 31TOC1stPreviousNext↓BottomJust 5th

special and non-recurring charges associated with this program totaled $136.4   
pretax ($111.9 net of tax, or $.43 per share on a basic and diluted basis) for  
the year ended December 31, 1999 and $154.4 pretax ($122.8 net of tax, or $.46  
per share on a basic and diluted basis) for the year ended December 31, 1998.   
At December 31, 1999, the remaining liability balance was $26.2 and relates     
primarily to severance costs that will be paid in 2000.                         

 BPR initiatives underway are intended to reduce costs by up to $400.0 a
year by 2000, with a portion of the savings being reinvested primarily in       
consumer-focused initiatives. Total savings from BPR initiatives for 1999       
approximated $250.0.                                                            

Global Business Strategy                                                        

   In 1999, the Company adopted a new strategic plan to drive revenue growth
and expand its customer base around the world by building on the Company's      
strength as a beauty marketer and a leading home direct seller. The new         
strategy includes, but is not limited to, plans to accelerate growth in its     
core beauty business by growing global brands, expanding market share,          
upgrading its beauty image and new product innovation; building a global        
portfolio of jewelry and accessories; developing innovative programs to train,  
motivate and retain Representatives; exploiting retail opportunities; and       
developing new businesses. The Company expects that its BPR programs will       
continue to provide resources to fund these strategic growth initiatives and    
contribute to earnings growth. Spending for product innovation and advertising  
are also key components in building a global beauty image and reaching the end  
consumer. In 2000, the Company will launch its first-ever global advertising    
campaign and significantly expand its use of Internet technology.               

Avon's global strategies include the following key growth initiatives:

Direct Selling Contemporization                                                 

   The Company continues to contemporize its direct selling channel enabling
it to reach women quickly and efficiently by offering Representative training,  
support and earnings opportunities. The Company is planning to roll out a       
global Sales Leadership program in its ten largest markets around the world.    
The Sales Leadership program is a modified multi-level selling system which     
will give Representatives the opportunity to earn commissions generated from    
downstream sales of other Representatives they recruit. This program limits the 
number of levels to three and continues to focus on individual product sales.   

   The Company also plans to implement a Representative development strategy
in 2000. This strategy will focus on the professional training and development  
of its Representatives through the introduction of the Avon Beauty Advisor.     
Beauty Advisor training will include an in-home study package as well as        
seminars where Representatives will be trained                                  

-2- 


10-K/A6th Page of 31TOC1stPreviousNext↓BottomJust 6th

to do beauty makeovers, where permissible, and consultations. In addition to    
introducing the Avon Beauty Advisor, the Company has formed an alliance with a  
sales motivation company to introduce a series of Avon-sponsored training       
materials and seminars called "Success by Design". Avon is also developing      
enhanced Representative training to support the Sales Leadership opportunity,   
including a certification process for each Leadership level.                    

    In addition to the Sales Leadership program and Representative development
strategy, the Company is planning to build and relaunch its Avon.com Internet   
site in the United States with a technology partner. The site will feature      
Avon's full product line and will be designed to help its U.S. sales            
Representatives build their own Avon business by enabling them to sell online   
through their own personalized web pages, developed in partnership with the     
Company. The Representatives can tailor their web pages to their specific       
customer bases by promoting particular products, targeting specific age groups  
and consumer segments, and reflecting seasonal interests and regional tastes.   
These "e-Representatives" will be able to conduct all aspects of their Avon     
business online, including customer prospecting, ordering, getting account      
status and making payments. Avon will also sell products directly to consumers  
if they choose not to purchase through a Representative.                        

Additionally, the Company annually produces more than 600 million     
brochures in a dozen languages, utilizing common imagery and layouts from a     
single global database to enhance its global beauty image. In 2000, Avon plans  
on incremental spending to upgrade the quality of brochures, in several of its  
largest markets, including the U.S.                                             

Complementary Access                                                            

  To accelerate growth in established industrial nations such as the U.S.,
Western Europe and Japan, the Company has developed new channels to reach more  
customers and improve access to its products through Avon Beauty Centers and    
Express Centers in the U.S., toll-free telephone numbers, direct mail and "on   
line" shopping via the Internet on Avon's web site, Avon.com. Avon Beauty       
Centers, located in urban malls across the United States, are designed to       
display an upscale beauty image, showcase the Company's beauty brands and       
encourage customer trial of product. Avon Express Centers also provide easy     
access to products and allow Representatives to fill orders immediately, rather 
than waiting for campaign deliveries. In 2000, Avon intends to implement a more 
integrated Internet strategy beginning with the U.S. to focus on improving      
access and accelerating growth. These complementary access programs will        
further increase Avon's brand awareness and drive its global beauty image.      

Access strategies also have helped reach new customers in the Pacific 
Region. For example, the Philippines, India and Indonesia use decentralized     
branches and satellite stores to serve Representatives and customers.           
Representatives come to a branch near their homes to place                      

-3- 


10-K/A7th Page of 31TOC1stPreviousNext↓BottomJust 7th

and pick up product orders for their customers. The branches also create        
visibility for Avon with consumers and help reinforce the Company's beauty      
image. In Malaysia, Avon has 180 franchised beauty boutiques, which are staffed 
by franchise Representatives and are located in areas with high concentrations  
of Representatives. The boutiques provide more direct and personal service to   
Representatives and their customers. Additionally, in China and Taiwan, beauty  
counters managed by Avon Representatives are in retail store chains.            

The Company is exploring potential retail opportunities in the U.S.,  
including a franchising opportunity for women who would own their own Avon      
retail store or kiosk and a "store within a store" concept developed through a  
joint venture with a major retailer.                                            

Image Enhancement                                                               

   The Company continues to update the image of its core beauty products and
its portfolio of global beauty brands. In the past five years, CFT products     
have all undergone extensive upgrades in packaging, imaging and formulations,   
consistent with the global brand strategy. These contemporary products project  
a consistent, high quality image in all markets and include brands such as      
Anew, Skin-So-Soft, Avon Color, Far Away, Rare Gold, Millennia, Perceive,       
Starring, Avon Skin Care and Women of Earth. Global brands are growing rapidly  
as a percentage of the Company's worldwide CFT business and in 1999, they       
accounted for 51% of core beauty sales. The Company plans on launching three    
global hair care brands and launching a global jewelry and fashion accessories  
line around the world. The development of global brands has also enabled the    
Company to deliver a consistent beauty image around the world, as well as       
improve margins through pricing and supply chain efficiencies. Avon is also     
marketing a more vibrant beauty image through increased advertising and         
image-building programs focused on the consumer. In 2000, the Company intends   
to launch its first-ever global advertising campaign entitled "Let's Talk",     
increase investments in product sampling and development and upgrade the        
quality of its brochure to further build its worldwide beauty image.            

   In 1998, an important image enhancement came with the opening of the Avon
Centre, a spa, salon and retail store located in Trump Tower, New York City.    
The Avon Centre emphasizes health and beauty and offers a selection of Avon     
beauty products created exclusively for use at the Avon Centre.                 

Through these strategic initiatives designed to focus on high-        
quality, affordable products, as well as convenience for the customer, Avon is  
not only positioned for continued growth but also as a leading beauty company.  

International Expansion                                                         

 Avon is one of the most widely recognized brand names in the world. The
Company is particularly well positioned to capitalize on growth in new          
international markets due to high demand for quality products, underdeveloped   
retail, infrastructures and relatively attractive earnings opportunities for    
women. The Company presently has operations in 50                               

-4- 


10-K/A8th Page of 31TOC1stPreviousNext↓BottomJust 8th

countries outside the United States and its products are distributed in 86 more 
for coverage in 137 markets, and it continues to expand into new markets. The   
Company has entered 24 new markets since 1990, including Russia and China and   
rapidly emerging nations throughout Central Europe, and is currently evaluating 
several other markets in Eastern Europe and the Pacific region.                 

Distribution                                                                    

Avon's products are sold worldwide by approximately 3.0 million       
Representatives, approximately 445,000 of whom are in the United States. Almost 
all Representatives are women who sell on a part-time basis. Representatives    
are independent contractors or independent dealers, and are not agents or       
employees of Avon. Representatives purchase products directly from Avon and     
sell them to their customers.                                                   

The Company's products are sold to customers through a combination of 
direct selling and marketing utilizing independent Representatives, Avon Beauty 
Centers, Express Centers in urban areas, the mail, phone, fax or "on-line".     
Representatives go where the customers are, both in the home and in the         
workplace.                                                                      

In the United States, the Representative contacts customers, selling  
primarily through the use of brochures which also highlight new products and    
specially-priced items for each two-week sales campaign. Product samples,       
demonstration products and selling aids such as make-up color charts are also   
used. Generally, the Representative forwards an order every two weeks to a      
designated distribution center. This order is processed and the products are    
assembled at the distribution center and delivered to the Representative's      
home, usually by a local delivery service. The Representative then delivers the 
merchandise and collects payment from the customer for their own account.       
Payment by the Representative to Avon is customarily made when the next order   
is forwarded to the distribution center. The cost of merchandise to the         
Representative varies according to the product category and/or to the total     
order size for each two-week sales campaign and averages approximately 60       
percent of the recommended selling price.                                       

  Avon employs certain electronic order systems to increase Representative
support in the United States and allow them to run their business more          
efficiently as well as to improve order processing accuracy. One of these       
systems permits Representatives to submit add-on orders with a touch-tone       
telephone, enabling them to augment orders already submitted by placing a phone 
call. Another system, Avon's Personal Order Entry Terminal, permits the         
top-producing Representatives in the United States to transmit orders           
electronically by phone line, 24 hours a day, seven days a week.                

    The current Internet site, Avon.com, with nearly 400,000 visitors a month,
also sells a limited line of CFT products directly to consumers. In 2000, the   
Company plans to launch a completely new Avon.com in the U.S., with             
implementation in certain key markets within about one year of the U.S. launch. 
The new online initiative will be available to all Representatives and offer a  
complete line of Avon products 24 hours a day, 7 days a week, with no           
geographic boundaries.                                                          

-5- 


10-K/A9th Page of 31TOC1stPreviousNext↓BottomJust 9th

   Outside the United States, each sales campaign is generally of a three or
four week duration. Although terms of payment and cost of merchandise to the    
Representative vary from country to country, the basic method of direct selling 
and marketing by Representatives is essentially the same as that used in the    
United States, and substantially the same merchandising and promotional         
techniques are utilized.                                                        

The recruiting and training of Representatives are the primary        
responsibilities of district managers. In the United States, each district      
manager has responsibility for a market area covered by 225 to 300              
Representatives. District managers are employees of Avon and are paid a salary  
and a sales incentive based primarily on the increase over the prior year's     
sales of Avon products by Representatives in their district. Personal contacts, 
including recommendations from current Representatives and local advertising,   
constitute the primary means of obtaining new Representatives. Because of the   
high rate of turnover among Representatives, a characteristic of the            
direct-selling method, recruiting and training of new Representatives are       
continually necessary.                                                          

    From time to time, the question of the legal status of Representatives has
arisen, usually in regard to possible coverage under social benefit laws that   
would require Avon (and in most instances, the Representatives) to make regular 
contributions to social benefit funds. Although Avon has generally been able to 
address these questions in a satisfactory manner, the matter has not been fully 
resolved in all countries. If there should be a final determination adverse to  
Avon in a country, the cost for future, and possibly past, contributions could  
be so substantial in the context of the volume of business of Avon in that      
country that it would have to consider discontinuing operations in that         
country.                                                                        

Promotion and Marketing                                                         

    Sales promotion and sales development activities are directed at assisting
the Representatives, through sales aids such as brochures, product samples and  
demonstration products. In order to support the efforts of Representatives to   
reach new customers, especially working women and other individuals who         
frequently are not at home, specially designed sales aids, promotional pieces,  
customer flyers and product and image enhancing media advertising are used. In  
addition, Avon seeks to motivate its Representatives through the use of special 
incentive programs that reward superior sales performance. Periodic sales       
meetings with Representatives are conducted by the district managers. The       
meetings are designed to keep Representatives abreast of product line changes,  
explain sales techniques and provide recognition for sales performance.         

 A number of merchandising techniques, including the introduction of new
products, the use of combination offers, the use of trial sizes and the         
promotion of products packaged as gift items, are used. In general for each     
sales campaign, a distinctive brochure is published, in which new products are  
introduced and selected items are offered at special prices or are given        
particular prominence in the brochure. CFT products are available each sales    
campaign at consistently low prices, while maintaining introductory specials    
and periodic sales on selected items for limited time periods.                  

-6- 


10-K/A10th Page of 31TOC1stPreviousNext↓BottomJust 10th

From time to time, various regulations or laws have been proposed or  
adopted that would, in general, restrict the frequency, duration or volume of   
sales resulting from new product introductions, special prices or other special 
price offers. The Company's pricing flexibility and broad product lines are     
expected to be able to mitigate the effect of these regulations.                

Competitive Conditions                                                          

  The CFT; gift and decorative; apparel; and fashion jewelry and accessory
industries are highly competitive. Avon is one of the leading manufacturers and 
distributors of cosmetics and fragrances in the United States. Its principal    
competitors are the large and well-known cosmetics and fragrances companies     
that manufacture and sell broad product lines through various types of retail   
establishments. There are many other companies that compete in particular       
products or product lines sold through retail establishments.                   

   Avon has many competitors in the gift and decorative products and apparel
industries in the United States, including retail establishments, principally   
department stores, gift shops and direct-mail companies, specializing in these  
products.                                                                       

    Avon is one of the leading distributors of fashion jewelry and accessories
for women in the United States. Its principal competition in the fashion        
jewelry industry consists of a few large companies and many small companies     
that manufacture and sell fashion jewelry for women through retail              
establishments.                                                                 

    The number of competitors and degree of competition that Avon faces in its
foreign CFT and fashion jewelry markets varies widely from country to country.  
Avon is one of the leading manufacturers and distributors in the CFT industry   
in most of its foreign markets, as well as in the fashion jewelry industry in   
Europe.                                                                         

   There are a number of direct-selling companies which sell product
lines similar to Avon's, some of which also have worldwide operations and       
compete with Avon.                                                              

Avon believes that the personalized customer service offered by its   
Representatives; the high quality, attractive designs and reasonable prices of  
its products; new product introductions; innovative CFT products; and its       
guarantee of satisfaction are significant factors in establishing and           
maintaining its competitive position.                                           

-7- 


10-K/A11th Page of 31TOC1stPreviousNext↓BottomJust 11th

 Avon's consolidated net sales, by classes of principal products, are as
follows:                                                                        

                                   Years ended December 31
                                   -----------------------
                                  1999      1998      1997
                                  ----      ----      ----
Cosmetics, fragrance and toiletries      $3,226.1  $3,176.6  $3,093.9           

Beauty Plus:                                                                    
Jewelry and accessories                 455.4     408.1     370.2       
Apparel                                 556.1     567.7     565.6       
                              --------  --------  --------
                               1,011.5     975.8     935.8

Non-core*                                 1,051.5   1,060.3   1,049.7           
                              --------  --------  --------
Total net sales                          $5,289.1  $5,212.7  $5,079.4           
                              ========  ========  ========

* Non-core category primarily includes gift and decorative and home             
entertainment items.                                                            

International Operations                                                        

Avon's international operations are subject to certain customary risks
inherent in carrying on business abroad, including the risk of adverse currency 
fluctuations, currency remittance restrictions and unfavorable economic and     
political conditions.                                                           

Avon's international operations are conducted primarily through       
subsidiaries in 50 countries and Avon's products are distributed in some 86     
other countries.                                                                

Manufacturing                                                                   

Avon manufactures and packages almost all of its CFT products. Raw    
materials, consisting chiefly of essential oils, chemicals, containers and      
packaging components, are purchased from various suppliers. Packages,           
consisting of containers and packaging components, are designed by its staff of 
artists and designers.                                                          

 The design and development of new products are affected by the cost and
availability of materials such as glass, plastics and chemicals. Avon believes  
that it can continue to obtain sufficient raw materials and supplies to         
manufacture and produce its products.                                           

Avon has eighteen manufacturing laboratories around the world, one of 
which is principally devoted to the manufacture of fashion jewelry. In the      
United States, Avon's CFT products are produced in three manufacturing          
laboratories for the four distribution centers and all Beauty and Express       
centers. Most products sold in foreign countries are manufactured in Avon's     
facilities abroad.                                                              

The fashion jewelry line is generally developed by Avon's staff and   
produced in its manufacturing laboratory in Puerto Rico or by several           
independent manufacturers.                                                      

-8- 


10-K/A12th Page of 31TOC1stPreviousNext↓BottomJust 12th

Trademarks and Patents                                                          

    Avon's business is not materially dependent on third party patent or other
intellectual property rights and Avon is not a party to any material license,   
franchise or concession. The Company, however, does seek to protect its key     
proprietary technologies by aggressively pursuing comprehensive patent coverage 
in all major markets.                                                           

    Avon's major trademarks are protected by registration in the United States
and the other countries where its products are marketed as well as in many      
other countries throughout the world.                                           

Contingencies                                                                   

Although Avon has completed its divestiture of all discontinued       
operations, various lawsuits and claims (asserted and unasserted), are pending  
or threatened against Avon. The Company is also involved in a number of         
proceedings arising out of the federal Superfund law and similar state laws. In 
some instances Avon, along with other companies, has been designated as a       
potentially responsible party which may be liable for costs associated with     
these various hazardous waste sites. In the opinion of Avon's management, based 
on its review of the information available at this time, the total cost of      
resolving such contingencies should not have a material adverse impact on       
Avon's consolidated financial position, results of operations or cash flows.    

SEASONAL NATURE OF BUSINESS                                                     

    Avon's sales and earnings have a marked seasonal pattern characteristic of
many companies selling CFT; gift and decorative products; apparel; and fashion  
jewelry. Christmas sales cause a sales peak in the fourth quarter of the year.  
Fourth quarter net sales were 30 percent of total net sales in both 1999 and    
1998, respectively, and before one-time charges, fourth quarter operating       
profit was 36 percent and 37 percent of total operating profit in 1999 and      
1998, respectively.                                                             

RESEARCH ACTIVITIES                                                             

 Avon's research and development department is a leader in the industry,
based on the number of new product launches, including formulating effective    
beauty treatments relevant to women's needs. In addition, Avon's research and   
development supports its environmental responsibilities.                        

   A team of researchers and technicians apply the disciplines of science to
the practical aspects of bringing products to market around the world.          
Relationships with well known dermatologists and other specialists extend       
Avon's own research to deliver new formulas and ingredients. Each year, Avon    
researchers test and develop more than 600 products in the CFT and Beauty Plus  
categories.                                                                     

  Avon has pioneered many innovative products, including Skin-So-Soft, its
best-selling bath oil; BioAdvance, the first skin care product with stabilized  
retinol, the purest form of Vitamin A; and Collagen Booster, the premier        
product to capitalize on Vitamin C technology. Avon also                        

-9- 


10-K/A13th Page of 31TOC1stPreviousNext↓BottomJust 13th

introduced the benefits of aromatherapy to millions of American women,          
encapsulated color for the Color-Release line and introduced alpha-hydroxy acid 
for cosmetic use in the Anew Perfecting Complex products. Today, Avon's Anew    
product line has been expanded to include technologically advanced products     
such as Retinol Recovery Complex PM Treatment, Night Force Vertical Lifting     
Complex, Clearly C 10% Vitamin C Serum and Luminosity Brightening Complex.      
Night Force employs a patented material named AVC10, a molecule that was        
engineered by Avon researchers over a three-year period. Luminosity Brightening 
Complex contains Diamonex, Avon's exclusive skin brightening system. Avon has   
introduced Hydra Finish Lip Color, the first lipstick developed with 20% water, 
and Perceive, a fragrance which uses the mood-enhancing effects of pheromone    
technology. In 2000, the Company will be launching a complete renovation of     
Avon Color with improved formulas and redesigned packaging, rolling out a       
reformulated Anew All-In-One skin care regimen and launching Positivity, a new  
line of skin care products for menopausal women.                                

    The amounts incurred on research activities relating to the development of
new products and the improvement of existing products were $34.4 million in     
1999, $31.4 million in 1998, and $29.9 million in 1997. This research included  
the activities of product research and development and package design and       
development. Most of these activities are related to the development of CFT     
products.                                                                       

ENVIRONMENTAL MATTERS                                                           

  Pursuant to Avon's global environmental policy, environmental audits are
conducted to ensure Avon facilities around the world meet or exceed local       
regulatory standards. A corporate environmental operations committee ensures    
that opportunities for environmental performance improvements are reflected in  
our products, packaging and manufacturing processes.                            

In general, compliance with environmental regulations impacting Avon's
global operations has not had, and is not anticipated to have, any material     
effect upon the capital expenditures, financial position or competitive         
position of Avon.                                                               

EMPLOYEES                                                                       

 At December 31, 1999, Avon employed 40,500 people. Of these, 8,800 were
employed in the United States and 31,700 in other countries. The number of      
employees tends to rise from a low point in January to a high point in November 
and decreases somewhat in December when Christmas shipments are completed.      

ITEM 2. PROPERTIES                                                              

   Avon's principal properties consist of manufacturing laboratories for the
production of CFT and fashion jewelry and distribution centers where offices    
are located and where finished merchandise is warehoused and shipped to         
Representatives in fulfillment of their orders. Substantially all of these      
properties are owned by Avon or its subsidiaries, are in good repair,           
adequately meet Avon's needs and operate at reasonable levels of productive     
capacity.                                                                       

-10-


10-K/A14th Page of 31TOC1stPreviousNext↓BottomJust 14th

  The domestic manufacturing laboratories are located in Morton Grove, IL;
Springdale, OH; and Suffern, NY; the distribution centers are located in        
Atlanta, GA; Glenview, IL; Newark, DE; and Pasadena, CA. Other properties       
include four manufacturing laboratories and ten distribution centers in Europe; 
five manufacturing laboratories and nine distribution centers in Latin America; 
two manufacturing laboratories and three distribution centers in North America  
(other than in the United States); and four manufacturing laboratories and ten  
distribution centers in the Pacific region. The research and development        
laboratories are located in Suffern, NY. Avon leases space for its executive    
and administrative offices in New York City and its fashion jewelry             
manufacturing facility in Puerto Rico.                                          

ITEM 3. LEGAL PROCEEDINGS                                                       

Various lawsuits and claims (asserted and unasserted), arising in the 
ordinary course of business or related to businesses previously sold, are       
pending or threatened against Avon.                                             

 In 1991, a class action lawsuit was initiated against Avon on behalf of
certain classes of holders of Avon's Preferred Equity-Redemption Cumulative     
Stock ("PERCS"). This lawsuit alleges various contract and securities law       
claims relating to the PERCS (which were fully redeemed that year). Avon has    
rejected the assertions in this case, believes it has meritorious defenses to   
the claims and is vigorously contesting this lawsuit. It is anticipated that a  
trial may take place later in 2000.                                             

In the opinion of Avon's management, based on its review of the       
information available at this time, the total cost of resolving such            
contingencies should not have a material adverse impact on Avon's consolidated  
financial position, results of operations or cash flows.                        

Avon is involved in a number of proceedings arising out of the federal
Superfund law and similar state laws. In some instances Avon, along with other  
companies, has been designated as a potentially responsible party which may be  
liable for costs associated with these various hazardous waste sites. Based     
upon Avon's current knowledge of the proceedings, management believes, without  
taking into consideration any insurance recoveries, if any, that in the         
aggregate they would not have a material adverse impact on Avon's consolidated  
financial position, results of operations or cash flows.                        

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                     

    No matters were submitted to a vote of security holders during the quarter
ended December 31, 1999.                                                        

Officers are elected by the Board of Directors at its first meeting   
following the Annual Meeting of Shareholders. Officers serve until the first    
meeting of the Board of Directors following the Annual Meeting of Shareholders  
at which Directors are elected for the succeeding year, or until their          
successors are elected, except in the event of death, resignation or removal,   
or the earlier termination of the term of office.                               

-11-


10-K/A15th Page of 31TOC1stPreviousNext↓BottomJust 15th

Information regarding employment contracts between Avon and named     
executive officers is incorporated by reference to the "Contracts with          
Executives" section of Avon's Proxy Statement for the 2000 Annual Meeting of    
Shareholders.                                                                   

  Listed below are the executive officers of Avon, each of whom (except as
noted) has served in various executive and operating capacities with Avon       
during the past five years:                                                     

                                                                   Elected
Title                                         Name             Age    Officer   
-----                                         ----             ---    -------   

Retired Chairman of the                                                         
  Board and Director ....................  James E. Preston     66       1971(1)

Retired Chief Executive                                                         
  Officer and Director...................  Charles R. Perrin    54       1998(1)

President and                                                                   
  Chief Executive Officer and Director...  Andrea Jung          41       1997(2)

Executive Vice President                                                        
Chief Operating Officer, North America                                    
   and Global Business Operations........  Susan J. Kropf       51       1997(3)

Executive Vice President                                                        
Chief Operating Officer, International                                    
   and New Business Development..........  Jose Ferreira        43       1997(4)

Executive Vice President, Asia Pacific...  Fernando Lezama      60       1997   

Executive Vice President and                                                    
Chief Financial Officer...............  Robert J. Corti      50       1988

Senior Vice President, General Counsel                                          
and Secretary.........................  Ward M. Miller, Jr.  67       1993

Senior Vice President, Human Resources...  Jill Kanin-Lovers    48       1998   

Vice President and Controller............  Janice Marolda       39       1998   

(1) Charles R. Perrin joined Avon as Vice Chairman and Chief Operating Officer  
in January 1998 and was later elected Chief Executive Officer, effective July   
1998 and Chairman of the Board in May 1999, succeeding James E. Preston in his  
capacity as Chairman of the Board. Mr. Perrin retired from Avon in November     
1999. Also effective November 1999, Ms. Andrea Jung was named President and     
CEO, succeeding Mr. Perrin in his capacity as CEO and outside director Stanley  
C. Gault was elected non-executive Chairman of the Board of Directors.          

(2) Andrea Jung was elected President and Chief Executive Officer effective     
November 1999. succeeding Charles R. Perrin who retired November 1999. Ms. Jung 
joined Avon in January 1994 as President, Product Marketing and was promoted to 
Executive Vice President, Global Marketing and New Business in March 1997. In   
January 1998, she was elected President and was later elected Chief Operating   
Officer.                                                                        

(3) Susan J. Kropf was elected Chief Operating Officer, North America and       
Global Business Operations, effective November 1999. Ms. Kropf has been with    
Avon for almost thirty years. Prior to this appointment, she had been Executive 
Vice President and President, North America. She also served as Senior Vice     
President, U.S. Marketing and as Vice President, Product Development.           

-12-


10-K/A16th Page of 31TOC1stPreviousNext↓BottomJust 16th

(4) Jose Ferreira was elected Chief Operating Officer, International and New    
Business Development, effective November 1999. Mr. Ferreira has been with Avon  
for twenty years. Prior to this appointment, he had been Executive Vice         
President, Europe, Asia and Africa since January 1999. Prior to that, in 1997,  
he was promoted to Executive Vice President and President, Asia Pacific.        

PART II 

ITEM 5. MARKET FOR THE REGISTRANTS COMMON EQUITY AND RELATED                    
STOCKHOLDER MATTERS                                             

   This information is incorporated by reference to "Market Prices per Share
of Common Stock by Quarter" in Avon's Restated 1999 Annual Report to            
Shareholders.                                                                   

ITEM 6. SELECTED FINANCIAL DATA (RESTATED)                                      

    The information for the five-year period 1995 through 1999 is incorporated
by reference to the "Eleven-Year Review" in Avon's Restated 1999 Annual Report  
to Shareholders.                                                                

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF                      
OPERATIONS AND FINANCIAL CONDITION (RESTATED)                   

   This information is incorporated by reference to "Management's Discussion
and Analysis" in Avon's Restated 1999 Annual Report to Shareholders.            

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK             

 See discussion under the heading "Risk Management Strategies and Market
Rate Sensitive Instruments" in Avon's Restated 1999 Annual Report to            
Shareholders for information concerning market risk sensitive instruments. Such 
information is incorporated by reference in this Form 10-K/A.                   

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA (RESTATED)                  

This information is incorporated by reference to the "Consolidated    
Financial Statements and Notes", together with the report thereon of            
PricewaterhouseCoopers LLP, and "Results of Operations by Quarter" in Avon's    
Restated 1999 Annual Report to Shareholders.                                    

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON                        
ACCOUNTING AND FINANCIAL DISCLOSURE                             

Not applicable.                                                       

-13-


10-K/A17th Page of 31TOC1stPreviousNext↓BottomJust 17th

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT                     

Information regarding directors is incorporated by reference to the   
"Election of Directors" and "Information Concerning the Board of Directors"     
sections of Avon's Proxy Statement for the 2000 Annual Meeting of Shareholders. 
Information regarding executive officers is presented in Part I of this report. 

ITEM 11. EXECUTIVE COMPENSATION                                                 

This information is incorporated by reference to the "Information     
Concerning the Board of Directors" and "Executive Compensation" sections of     
Avon's Proxy Statement for the 2000 Annual Meeting of Shareholders.             

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT         

    This information is incorporated by reference to the "Ownership of Shares"
section of Avon's Proxy Statement for the 2000 Annual Meeting of Shareholders.  

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                         

This information is incorporated by reference to the "Contracts with  
Executives" section of Avon's Proxy Statement for the 2000 Annual Meeting of    
Shareholders.                                                                   

-14-


10-K/A18th Page of 31TOC1stPreviousNext↓BottomJust 18th

PART IV 

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULE, AND REPORTS                    
ON FORM 8-K (RESTATED)                                        
                                                   Form 10-K/A
                                                   Page Number
                                                   -----------
(a) 1. Consolidated Financial Statements of                                     
Avon Products, Inc. and Subsidiaries (as restated)            

Consolidated statements of income for                         
each of the years in the three-year                     
period ended December 31, 1999...........         18    
Consolidated balance sheets at                                
December 31, 1999 and 1998................         19     
Consolidated statements of cash flows                         
for each of the years in the three-year                   
period ended December 31, 1999............         20     
Consolidated statements of changes in                         
shareholders' (deficit)equity for each                    
of the years in the three-year period                     
ended December 31, 1999...................         21     
Notes to consolidated financial                               
statements................................      22-45     
Report of Independent Accountants                             
PricewaterhouseCoopers LLP................         46     

(a) 2. Financial Statement Schedule                                             

Report of Independent Accountants on                          
Financial Statement Schedule                            
PricewaterhouseCoopers LLP ..............         S-1   
Consent of Independent Accountants                            
PricewaterhouseCoopers LLP ..............         S-2   
Financial statement schedule for each                         
of the years in the three-year period                     
ended December 31, 1999..................                 
II.  Valuation and qualifying           
            accounts.................          S-3

-15-


10-K/A19th Page of 31TOC1stPreviousNext↓BottomJust 19th

Financial statements of the registrant and all other financial statement        
schedules are omitted because they are not applicable or because the required   
information is shown in the consolidated financial statements and notes.        

(a)3.  Exhibits                                                                 

Exhibit                                                                         
Number                              Description                                 
-------                             -----------                                 
3.1        Restated Certificate of Incorporation of Avon, filed with the        
 Secretary of State of the State of New York on May 13, 1996
          (incorporated by reference to Exhibit 3.1 to Avon's Quarterly Report
on Form 10-Q for the quarter ended June 30, 1996).        

3.2        By-laws of Avon, as restated, effective December 2, 1999             
          (incorporated by reference to Exhibit 3.2 to Avon's Annual Report on
Form 10-K for the year ended December 31, 1999).          

3.3        Certificate of Amendment of the Certificate of Incorporation of Avon 
      Products, Inc., filed May 13, 1998 (incorporated by reference to
         Exhibit 3.3 to Avon's Quarterly Report on Form 10-Q for the quarter
ended March 30, 1998).                                    

4.1        Amended and Restated Revolving Credit and Competitive Advance        
      Facility Agreement, dated as of August 8, 1996, among Avon, Avon
Capital Corporation and a group of banks and other lenders
          (incorporated by reference to Exhibit 4.1 to Avon's Quarterly Report
on Form 10-Q for the quarter ended September 30, 1996).   

4.2        Indenture dated as of August 1, 1997 between Avon as Issuer, and The 
      Chase Manhattan Bank, as Trustee relating to the 6.55% Notes due
2007 (incorporated by reference to Exhibit 4.2 to Avon's  
    Registration Statement on Form S-4, Registration Statement No.
333-41299 filed December 1, 1997).                        

4.3        Rights Agreement, dated as of March 30, 1998 (the "Rights            
      Agreement"), between Avon and First Chicago Trust Company of New
         York (incorporated by reference to Exhibit 4 to Avon's Registration
Statement on Form 8-A, filed March 18, 1998).             

4.4        Indenture dated as of November 9, 1999 between Avon as Issuer and    
         The Chase Manhattan Bank, as Trustee relating to the 6.9% Notes due
 November 15, 2004 and the 7.15% Notes due November 15, 2009
      (incorporated by reference to Exhibit 4.4 to Avon's Registration
       Statement on Form S-4, Registration Statement No. 333-92333 filed
December 8, 1999).                                        

10.1*      Avon Products, Inc. 1993 Stock Incentive Plan, approved by           
       stockholders on May 6, 1993 (incorporated by reference to Exhibit
        10.2 to Avon's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1993).                                           

-16-


10-K/A20th Page of 31TOC1stPreviousNext↓BottomJust 20th

10.2*      Form of Stock Option Agreement to the Avon Products, Inc. 1993 Stock 
         Incentive Plan (incorporated by reference to Exhibit 10.2 to Avon's
       Annual Report on Form 10-K for the year ended December 31, 1993).

10.3*      First Amendment to the 1993 Avon Stock Incentive Plan effective      
January 1, 1997, approved by stockholders on May 1, 1997  
    (incorporated by reference to exhibit 10.1 to Avon's Quarterly
    Report on Form 10-Q for the quarter ended September 30, 1997).

10.4*      Avon Products, Inc. 1997 Long-Term Incentive Plan, effective as of   
January 1, 1997 approved by stockholders on May 1, 1997   
        (incorporated by reference to Exhibit 10.4 to Avon's Annual Report
on Form 10-K for the year ended December 31, 1997).       

10.5*      Supplemental Executive Retirement Plan and Supplemental Life Plan of 
     Avon Products, Inc., as amended and restated as of July 1, 1998
        (incorporated by reference to Exhibit 10.5 to Avon's Annual Report
on Form 10K for the year ended December 31, 1998).        

10.6*      Benefit Restoration Pension Plan of Avon Products, Inc., effective   
         as of January 1, 1994 (incorporated by reference to Exhibit 10.7 to
       Avon's Annual Report on Form 10-K for the year ended December 31,
1994).                                                    

10.7*      Trust Agreement, amended and restated as of March 2, 1990, between   
       Avon and Chase Manhattan Bank, N.A. (incorporated by reference to
          Exhibit 10.2 to Avon's Quarterly Report on Form 10-Q for the quarter
       ended March 31, 1990 and refiled under Form SE for the year ended
December 31, 1996).                                       

10.8*      First Amendment, dated as of January 30, 1992, to the Trust          
         Agreement, dated as of March 2, 1990, by and between Avon and Chase
        Manhattan Bank, N.A. (incorporated by reference to Exhibit 10.2 to
          Avon's Quarterly Report on Form 10-Q for the quarter ended March 31,
1993).                                                    

10.9*      Second Amendment, dated as of June 12, 1992 to the Trust Agreement,  
        dated as of March 2, 1990, by and between Avon and Chase Manhattan
     Bank, N.A. (incorporated by reference to Exhibit 10.3 to Avon's
          Quarterly Report on Form 10-Q for the quarter ended March 31, 1993).

10.10*     Third Amendment, dated as of November 5, 1992, to the Trust          
         Agreement, dated as of March 2, 1990, by and between Avon and Chase
        Manhattan Bank, N.A. (incorporated by reference to Exhibit 10.4 to
          Avon's Quarterly Report on Form 10-Q for the quarter ended March 31,
1993).                                                    

-17-


10-K/A21st Page of 31TOC1stPreviousNext↓BottomJust 21st

10.11*     The Avon Products, Inc. Deferred Compensation Plan, as amended and   
       restated as of July 1, 1998 (incorporated by reference to Exhibit
         4(b) to Avon's Registration Statement on Form S-8, Registration No.
333-65989 filed October 22, 1998).                        

10.12*     Trust Agreement, dated as of April 21, 1995, between Avon and        
     Chemical Bank, amending and restating the Trust Agreement as of
         August 3, 1989 between Avon and Manufacturers Hanover Trust Company
         (incorporated by reference to Exhibit 10.14 to Avon's Annual Report
on Form 10-K for the year ended December 31, 1995).       

10.13*     Stock Option Agreement between Avon and Stanley C. Gault dated       
     November 4, 1999 (incorporated by reference to Exhibit 10.13 to
      Avon's Annual Report on Form 10K for the year ended December 31,
1999).                                                    

10.14*     Employment Agreement, dated as of December 11, 1997 between Avon and 
      Charles R. Perrin (incorporated by reference to Exhibit 10.18 to
       Avon's Annual Report on Form 10-K for the year ended December 31,
1997).                                                    

10.15*     Stock Option Agreement between Avon and Charles R. Perrin dated      
      December 10, 1997 (incorporated by reference to Exhibit 10.19 to
       Avon's Annual Report on Form 10-K for the year ended December 31,
1997).                                                    

10.16*     Employment Agreement dated as of December 11, 1997 between Avon and  
       Andrea Jung (incorporated by reference to Exhibit 10.20 to Avon's
       Annual Report on Form 10-K for the year ended December 31, 1997).

10.17*     Form of Employment Agreement, dated as of September 1, 1994, between 
    Avon and certain senior officers (incorporated by reference to
          Exhibit 10.2 to Avon's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1994).                                

10.18*     Avon Products, Inc. Compensation Plan for Non-Employee Directors,    
          effective May 1, 1997 (incorporated by reference to Exhibit 10.22 to
       Avon's Annual Report on Form 10-K for the year ended December 31,
1997).                                                    

10.19*     Avon Products, Inc. Board of Directors' Deferred Compensation Plan,  
      amended and restated, effective January 1, 1997 (incorporated by
         reference to Exhibit 10.23 to Avon's Annual Report on Form 10-K for
the year ended December 31, 1997).                        

10.20*     Trust Agreement, dated as of December 31, 1991, between Avon and     
       Manufacturers Hanover Trust Company (incorporated by reference to
     Exhibit 10.23 to Avon's Annual Report on Form 10-K for the year
          ended December 31, 1991 and refiled under Form SE for the year ended
December 31, 1996).                                       

-18-


10-K/A22nd Page of 31TOC1stPreviousNext↓BottomJust 22nd

10.21*     First Amendment, dated as of November 5, 1992, to the Trust          
      Agreement dated as of December 31, 1991, by and between Avon and
       Manufacturers Hanover Trust Company (incorporated by reference to
          Exhibit 10.7 to Avon's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1993).                                    

10.22*     Stock Option Agreement between Avon and Charles R. Perrin dated June 
  4, 1998 (incorporated by reference to Exhibit 10.1 to Avon's
         Quarterly Report on Form 10-Q for the quarter ended June 30, 1998).

10.23*     Stock Option Agreement between Avon and Andrea Jung dated June 4,    
         1998 (incorporated by reference to Exhibit 10.2 to Avon's Quarterly
Report on Form 10-Q for the quarter ended June 30, 1998). 

13         Portions of the Restated Annual Report to Shareholders for the year  
      ended December 31, 1999 incorporated by reference in response to
Items 1,5 through 8 in this filing.                       

18         Preferability letter from PricewaterhouseCoopers LLP regarding       
change in accounting principle.                           

21         Subsidiaries of the registrant (incorporated by reference to Exhibit 
        21 to Avon's Annual Report on Form 10K for the year ended December
31, 1999).                                                

23         Consent of PricewaterhouseCoopers LLP (set forth on page S-2 of this 
Annual Report on Form 10-K/A).                            

*          The Exhibits identified above and in the Exhibit Index with an       
    asterisk (*) are management contracts or compensatory plans or
arrangements.                                             

(b)        Reports on Form 8-K                                                  
    There was no Form 8-K filed during the fourth quarter of 1999.

(c)        Avon's Annual Report on Form 10-K/A for the year ended December 31,  
  1999, at the time of filing with the Securities and Exchange
      Commission, shall modify and supersede all prior documents filed
        pursuant to Section 13, 14 or 15(d) of the Securities Exchange Act
         of 1934 for purposes of any offers or sales of any securities after
       the date of such filing pursuant to any Registration Statement or
    Prospectus filed pursuant to the Securities Act of 1933, which
  incorporates by reference such Annual Report on Form 10-K/A.

-19-


10-K/A23rd Page of 31TOC1stPreviousNext↓BottomJust 23rd

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities 
Exchange Act of 1934, the registrant has duly caused this report to be signed   
on its behalf by the undersigned, thereunto duly authorized.                    

                 Avon Products, Inc.
                    ----------------------
                  (Registrant)

Date: August 12, 2002                  /s/ Janice Marolda                       
                    ----------------------
            Janice Marolda
             Vice President,
        Controller
                          Principal Accounting Officer

-20-


10-K/A24th Page of 31TOC1stPreviousNext↓BottomJust 24th

REPORT OF INDEPENDENT ACCOUNTANTS 
ON FINANCIAL STATEMENT SCHEDULE 

To the Board of Directors of Avon Products, Inc.:                               

Our audits of the consolidated financial statements referred to in our report   
dated January 27, 2000, except for Notes 2 and 15 as to which the date is July  
31, 2002, appearing in the 1999 Annual Report to Shareholders of Avon Products, 
Inc., which report and consolidated financial statements are incorporated by    
reference in this Annual Report on Form 10-K/A, also included an audit of the   
financial statement schedule listed in Item 14(a)(2) of this Form 10-K/A. In    
our opinion, this financial statement schedule presents fairly, in all material 
respects, the information set forth therein when read in conjunction with the   
related consolidated financial statements.                                      

PricewaterhouseCoopers LLP                                                      
New York, New York                                                              

January 27, 2000, except for Notes 2 and 15                                     
as to which the date is July 31, 2002.                                          

S-1 


10-K/A25th Page of 31TOC1stPreviousNext↓BottomJust 25th

CONSENT OF INDEPENDENT ACCOUNTANTS

We consent to the incorporation by reference in the Registration      
Statements on Form S-3 (Reg. No. 33-45808) and on Form S-8 (Reg. Nos.           
33-43820,33-47209, 33-65989, and 33-65998) of Avon Products, Inc. of our report 
dated January 27, 2000, except for Notes 2 and 15 as to which the date is July  
31, 2002, relating to the financial statements which appear in the 1999 Annual  
Report to Shareholders, which is incorporated in this Annual Report on Form     
10-K/A. We also consent to the incorporation by reference of our report dated   
January 27, 2000, except for Notes 2 and 15 as to which the date is July 31,    
2002, relating to the financial statement schedule, which appears in this Form  
10-K/A.                                                                         

PricewaterhouseCoopers LLP                                                      
New York, New York                                                              

August 12, 2002                                                                 

S-2 


10-K/A26th Page of 31TOC1stPreviousNext↓BottomJust 26th

AVON PRODUCTS, INC. AND SUBSIDIARIES
SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS
(In millions) 
Years ended December 31 

               Additions
                 ---------------------
                     Balance at  Charged to  Charged               Balance
                    beginning   costs and   to other              at end
                       of period   expenses    accounts  Deductions  of period
                       ----------  ----------  --------  ----------  ---------
1999                                                                            
Allowance for doubtful                                                          
accounts receivable    $  49.0    $  87.5    $    --    $96.5(a)    $40.0   
                    =======    =======    =======    =====       =====

1998                                                                            
Allowance for doubtful                                                          
accounts receivable    $ $35.5    $  91.3    $    --    $77.8(a)    $49.0   
                    =======    =======    =======    =====       =====

1997                                                                            
Allowance for doubtful                                                          
accounts receivable   $ $36.4    $  80.8    $    --    $81.7(a)    $35.5  
                    =======    =======    =======    =====       =====

(a) Accounts written off, net of recoveries and foreign currency translation    
adjustment.                                                                     

S-3 


10-K/A27th Page of 31TOC1stPreviousNext↓BottomJust 27th

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

--------

FORM 10-K/A 

Annual Report Pursuant to Section 13 or 15(d) 
of the Securities Exchange Act of 1934

For the fiscal year ended December 31, 1999           
Commission file number 1-4881               

--------

AVON PRODUCTS, INC. 
(Exact name of registrant as specified in its charter)

--------

EXHIBITS


10-K/A28th Page of 31TOC1stPreviousNext↓BottomJust 28th

INDEX TO EXHIBITS 

(a)3.  Exhibits                                                                 

Exhibit                                                                         
Number                             Description                                  
--------                           -----------                                  

3.1        Restated Certificate of Incorporation of Avon, filed with the        
 Secretary of State of the State of New York on May 13, 1996
          (incorporated by reference to Exhibit 3.1 to Avon's Quarterly Report
on Form 10-Q for the quarter ended June 30, 1996).        

3.2        By-laws of Avon, as restated, effective December 2, 1999             
          (incorporated by reference to Exhibit 3.2 to Avon's Annual Report on
Form 10K for the year ended December 31, 1999).           

3.3        Certificate of Amendment of the Certificate of Incorporation of Avon 
      Products, Inc., filed May 13, 1998 (incorporated by reference to
         Exhibit 3.3 to Avon's Quarterly Report on Form 10-Q for the quarter
ended March 30, 1998).                                    

4.1        Amended and Restated Revolving Credit and Competitive Advance        
      Facility Agreement, dated as of August 8, 1996, among Avon, Avon
Capital Corporation and a group of banks and other lenders
          (incorporated by reference to Exhibit 4.1 to Avon's Quarterly Report
on Form 10-Q for the quarter ended September 30, 1996).   

4.2        Indenture dated as of August 1, 1997 between Avon as Issuer, and The 
      Chase Manhattan Bank, as Trustee relating to the 6.55% Notes due
2007 (incorporated by reference to Exhibit 4.2 to Avon's  
      Registration Statement S-4, Registration Statement No. 333-41299
filed December 1, 1997).                                  

4.3        Rights Agreement, dated as of March 30, 1998 (the "Rights            
      Agreement"), between Avon and First Chicago Trust Company of New
         York (incorporated by reference to Exhibit 4 to Avon's Registration
Statement on Form 8-A, filed March 18, 1998).             

4.4        Indenture dated as of November 9, 1999 between Avon as Issuer and    
         The Chase Manhattan Bank, as Trustee relating to the 6.9% Notes due
 November 15, 2004 and the 7.15% Notes due November 15, 2009
      (incorporated by reference to Exhibit 4.4 to Avon's Registration
       Statement on Form S-4, Registration Statement No. 333-92333 filed
December 8, 1999).                                        

10.1*      Avon Products, Inc. 1993 Stock Incentive Plan, approved by           
       stockholders on May 6, 1993 (incorporated by reference to Exhibit
        10.2 to Avon's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1993).                                           

10.2*      Form of Stock Option Agreement to the Avon Products, Inc. 1993 Stock 
         Incentive Plan (incorporated by reference to Exhibit 10.2 to Avon's
       Annual Report on Form 10-K for the year ended December 31, 1993).


10-K/A29th Page of 31TOC1stPreviousNext↓BottomJust 29th

10.3*      First Amendment to the 1993 Avon Stock Incentive Plan effective      
January 1, 1997, approved by stockholders on May 1, 1997  
    (incorporated by reference to Exhibit 10.1 to Avon's Quarterly
    Report on Form 10-Q for the quarter ended September 30, 1997).

10.4*      Avon Products, Inc. 1997 Long-Term Incentive Plan, effective as of   
January 1, 1997, approved by stockholders on May 1, 1997  
        (incorporated by reference to Exhibit 10.4 to Avon's Annual Report
on Form 10-K for the year ended December 31, 1997).       

10.5*      Supplemental Executive Retirement Plan and Supplemental Life Plan of 
     Avon Products, Inc., as amended and restated as of July 1, 1998
        (incorporated by reference to Exhibit 10.5 to Avon's Annual Report
on Form 10-K for the year ended December 31, 1998).       

10.6*      Benefit Restoration Pension Plan of Avon Products, Inc., effective   
         as of January 1, 1994 (incorporated by reference to Exhibit 10.7 to
       Avon's Annual Report on Form 10-K for the year ended December 31,
1994).                                                    

10.7*      Trust Agreement, amended and restated as of March 2, 1990, between   
       Avon and Chase Manhattan Bank, N.A. (incorporated by reference to
          Exhibit 10.2 to Avon's Quarterly Report on Form 10-Q for the quarter
       ended March 31, 1990 and refiled under Form SE for the year ended
December 31, 1996).                                       

10.8*      First Amendment, dated as of January 30, 1992, to the Trust          
         Agreement, dated as of March 2, 1990, by and between Avon and Chase
        Manhattan Bank, N.A. (incorporated by reference to Exhibit 10.2 to
          Avon's Quarterly Report on Form 10-Q for the quarter ended March 31,
1993).                                                    

10.9*      Second Amendment, dated as of June 12, 1992 to the Trust Agreement,  
        dated as of March 2, 1990, by and between Avon and Chase Manhattan
     Bank, N.A. (incorporated by reference to Exhibit 10.3 to Avon's
          Quarterly Report on Form 10-Q for the quarter ended March 31, 1993).

10.10*     Third Amendment, dated as of November 5, 1992, to the Trust          
         Agreement, dated as of March 2, 1990, by and between Avon and Chase
        Manhattan Bank, N.A. (incorporated by reference to Exhibit 10.4 to
          Avon's Quarterly Report on Form 10-Q for the quarter ended March 31,
1993).                                                    

10.11*     The Avon Products, Inc. Deferred Compensation Plan, as amended and   
          restated as of January 1, 1998 (incorporated by reference to Exhibit
         4(b) to Avon's Registration Statement on Form S-8, Registration No.
333-65989 filed October 22, 1998).                        


10-K/A30th Page of 31TOC1stPreviousNext↓BottomJust 30th

10.12*     Trust Agreement, dated as of April 21, 1995, between Avon and        
     Chemical Bank, amending and restating the Trust Agreement as of
         August 3, 1989 between Avon and Manufacturers Hanover Trust Company
         (incorporated by reference to Exhibit 10.14 to Avon's Annual Report
on Form 10-K for the year ended December 31, 1995).       

10.13*     Stock Option Agreement between Avon and Stanley C. Gualt dated       
     November 4, 1999 (incorporated by reference to Exhibit 10.13 to
      Avon's Annual Report on Form 10K for the year ended December 31,
1999).                                                    

10.14*     Employment Agreement, dated as of December 11, 1997 between Avon and 
      Charles R. Perrin (incorporated by reference to Exhibit 10.18 to
       Avon's Annual Report on Form 10-K for the year ended December 31,
1997).                                                    

10.15*     Stock Option Agreement between Avon and Charles R. Perrin dated      
      December 10, 1997 (incorporated by reference to Exhibit 10.19 to
       Avon's Annual Report on Form 10-K for the year ended December 31,
1997).                                                    

10.16*     Employment Agreement dated as of December 11, 1997 between Avon and  
       Andrea Jung (incorporated by reference to Exhibit 10.20 to Avon's
       Annual Report on Form 10-K for the year ended December 31, 1997).

10.17*     Form of Employment Agreement, dated as of September 1, 1994, between 
    Avon and certain senior officers (incorporated by reference to
          Exhibit 10.2 to Avon's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1994).                                

10.18*     Avon Products, Inc. Compensation Plan for Non-Employee Directors,    
          effective May 1, 1997 (incorporated by reference to Exhibit 10.22 to
       Avon's Annual Report on Form 10-K for the year ended December 31,
1997).                                                    

10.19*     Avon Products, Inc. Board of Directors' Deferred Compensation Plan,  
      amended and restated, effective January 1, 1997 (incorporated by
         reference to Exhibit 10.23 to Avon's Annual Report on Form 10-K for
the year ended December 31, 1997).                        

10.20*     Trust Agreement, dated as of December 31, 1991, between Avon and     
       Manufacturers Hanover Trust Company (incorporated by reference to
     Exhibit 10.23 to Avon's Annual Report on Form 10-K for the year
          ended December 31, 1991 and refiled under Form SE for the year ended
December 31, 1996).                                       

10.21*     First Amendment, dated as of November 5, 1992, to the Trust          
      Agreement dated as of December 31, 1991, by and between Avon and
       Manufacturers Hanover Trust Company (incorporated by reference to
          Exhibit 10.7 to Avon's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1993).                                    

10.22*     Stock Option Agreement between Avon and Charles R. Perrin dated June 
  4, 1998 (incorporated by reference to Exhibit 10.1 to Avon's
         Quarterly Report on Form 10-Q for the quarter ended June 30, 1998).


10-K/ALast Page of 31TOC1stPreviousNext↓BottomJust 31st

10.23*     Stock Option Agreement between Avon and Andrea Jung dated June 4,    
         1998 (incorporated by reference to Exhibit 10.2 to Avon's Quarterly
Report on Form 10-Q for the quarter ended June 30, 1998). 

13         Portions of the Restated Annual Report to Shareholders for the year  
      ended December 31, 1999 incorporated by reference in response to
Items 1,5 through 8 in this filing.                       

18         Preferability letter from PricewaterhouseCoopers LLP regarding       
change in accounting principle.                           

21         Subsidiaries of the registrant (incorporated by reference to Exhibit 
        21 to Avon's Annual Report on Form 10K for the year ended December
31, 1999).                                                

23         Consent of PricewaterhouseCoopers LLP (set forth on page S-2 of this 
Annual Report on Form 10-K/A).                            

*          The Exhibits identified above and in the Exhibit Index with an       
    asterisk (*) are management contracts or compensatory plans or
arrangements.

Dates Referenced Herein   and   Documents Incorporated by Reference

Referenced-On Page
This ‘10-K/A’ Filing    Date First  Last      Other Filings
11/15/091928
11/15/041928
Filed on:8/12/02232510-K/A,  10-Q/A
7/31/022425
3/31/02310-Q,  10-Q/A
12/31/01310-K,  10-K/A
12/31/00310-K,  10-K/A
2/29/002
1/27/002425
For Period End:12/31/9913110-K
12/8/991928S-4
12/2/991928
11/9/991928
11/4/992130
3/31/99310-Q,  10-Q/A
12/31/9852910-K
10/22/982129S-8
7/1/982029
6/30/98223110-Q
6/4/982231
5/13/981928
3/30/981928
3/18/9819288-A12B,  8-K
1/1/9829
12/31/97203010-K
12/11/972130
12/10/972130
12/1/971928S-4
9/30/97202910-Q
8/1/971928
5/1/972030DEF 14A
1/1/972030
12/31/96203010-K
9/30/96192810-Q
8/8/961928
6/30/96192810-Q
5/13/96192810-Q
12/31/95213010-K,  10-K/A
4/21/952130
12/31/94202910-K
9/30/94213010-Q
9/1/942130
1/1/942029
12/31/93202810-K
6/30/931928
5/6/931928
3/31/932030
11/5/922030
6/12/922029
1/30/922029
 List all Filings 
↑Top
Filing Submission 0000950103-02-000801   –   Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)
Copyright © 2024 Fran Finnegan & Company LLC – All Rights Reserved.
About — Privacy — Redactions — Help — Thu., Apr. 18, 11:10:08.2pm ET