DOW JONES NEWSWIRES
Avon Products Inc. (AVP) said it will separate the roles of
chairman and chief executive and search for a new chief as Andrea
Jung switches to serving solely as chairman.
Shares were up 5.6% at $17.05 in after-hours trading. Through
the close, the stock has declined 44% so far in 2011.
Jung, who has been the CEO of the door-to-door beauty products
company since 1999, will continue to handle both jobs as the board
undertakes an external search for her successor as chief. She will
also work with the new CEO to assist in the transition.
She said that the company has transformed during her tenure as
chief into its global operating model from a group of decentralized
local operating entities. Like many U.S. companies, Avon has driven
recent growth through its global extension, as demand overseas
compensates for softness in North America.
However, in its latest quarterly results, Avon's earnings
slipped 1.5% on weak sales in both Brazil and the U.S., its two
biggest markets.
Avon is also in the process of assessing its long-range business
plan and targeting an operational and financial update at an
investor meeting set for early next year. It previously has
undergone rounds of restructuring and cut thousands of jobs.
Tuesday, Jung said she believed the time was right to separate
the chairman and CEO roles as the company addresses its "growing
scale and opportunities."
-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291;
joan.solsman@dowjones.com