10-Q

UNITED STATES OF AMERICA

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________________

FORM 10-Q

_________________________

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

For the quarterly period ended June 30, 2019

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 Incorporation or organization)	(I.R.S. Employer Identification No.)

Building 6, Chiswick Park, London W4 5HR

United Kingdom

(Address of principal executive offices)

+44-1604-232425

(Registrant’s telephone number, including area code)

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

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $0.25 per share	AVP	NYSE

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  ☒   No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

The number of shares of Common Stock (par value $0.25) outstanding at June 30, 2019 was 443,332,735.

TABLE OF CONTENTS

		Page Numbers
Part I. Financial Information
Item 1.	Financial Statements (Unaudited)
	Consolidated Statements of Operations Three and Six Months Ended June 30, 2019 and June 30, 2018	3
	Consolidated Statements of Comprehensive Loss Three and Six Months Ended June 30, 2019 and June 30, 2018	5
	Consolidated Balance Sheets June 30, 2019 and December 31, 2018	7
	Consolidated Statements of Cash Flows Three and Six Months Ended June 30, 2019 and June 30, 2018	9
	Consolidated Statement of Changes in Shareholders Equity (Deficit) Three and Six Months Ended June 30, 2019 and June 30, 2018	11
	Notes to Consolidated Financial Statements	13 - 40
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	40 - 60
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	59
Item 4.	Controls and Procedures	59
Part II. Other Information
Item 1.	Legal Proceedings	60
Item 1A.	Risk Factors	60
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	63
Item 6.	Exhibits	64
	Signature	65

2

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

AVON PRODUCTS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended
(In millions, except per share data)	June 30, 2019			June 30, 2018
Product sales	$	1,108.8		$	1,268.8
Other revenue	66.0			83.1
Total revenue	1,174.8			1,351.9
Costs, expenses and other:
Cost of sales	(497.5		)	(539.7		)
Selling, general and administrative expenses	(646.8		)	(759.2		)
Operating profit	30.5			53.0
Interest expense	(30.7		)	(34.5		)
Loss on extinguishment of debt and credit facilities	—			(2.9		)
Interest income	1.5			3.5
Other income (expense), net	6.8			(19.4		)
Gain on sale of business / assets	13.2			—
Total other expenses	(9.2		)	(53.3		)
Income (loss) from continuing operations, before income taxes	21.3			(.3		)
Income taxes	(27.2		)	(36.7		)
Loss from continuing operations, net of tax	(5.9		)	(37.0		)
Loss from discontinued operations, net of tax	(13.2		)	—
Net loss	(19.1		)	(37.0		)
Net (income) loss attributable to noncontrolling interests	(.4		)	.9
Net loss attributable to Avon	$	(19.5	)	$	(36.1	)
Loss per share
Basic
Basic from continuing operations	$	(0.03	)	$	(0.09	)
Basic from discontinued operations	(0.03		)	—
Basic attributable to Avon	$	(0.06	)	$	(0.09	)
Diluted
Diluted from continuing operations	$	(0.03	)	$	(0.09	)
Diluted from discontinued operations	(0.03		)	—
Diluted attributable to Avon	$	(0.06	)	$	(0.09	)

The accompanying notes are an integral part of these statements.

3

AVON PRODUCTS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Six Months Ended
(In millions, except per share data)	June 30, 2019			June 30, 2018
Product sales	$	2,225.0		$	2,578.4
Other revenue	136.7			167.0
Total revenue	2,361.7			2,745.4
Costs, expenses and other:
Cost of sales	(1,014.5		)	(1,119.4		)
Selling, general and administrative expenses	(1,320.6		)	(1,528.1		)
Operating profit	26.6			97.9
Interest expense	(63.9		)	(70.7		)
Loss on extinguishment of debt	(2.0		)	(2.9		)
Interest income	3.2			7.7
Other income (expense), net	29.4			(21.9		)
Gain on sale of business / assets	23.5			—
Total other expenses	(9.8		)	(87.8		)
Income before income taxes	16.8			10.1
Income taxes	(46.7		)	(68.2		)
Loss from continuing operations, net of tax	(29.9		)	(58.1		)
Loss from discontinued operations, net of tax	(22.7		)	—
Net loss	(52.6		)	(58.1		)
Net loss attributable to noncontrolling interests	.4			1.7
Net loss attributable to Avon	$	(52.2	)	$	(56.4	)
Loss per share
Basic
Basic from continuing operations	$	(0.09	)	$	(0.15	)
Basic from discontinued operations	(0.05		)	—
Basic attributable to Avon	$	(0.14	)	$	(0.15	)
Diluted
Diluted from continuing operations	$	(0.09	)	$	(0.15	)
Diluted from discontinued operations	(0.05		)	—
Diluted attributable to Avon	$	(0.14	)	$	(0.15	)

The accompanying notes are an integral part of these statements.

4

AVON PRODUCTS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(Unaudited)

	Three Months Ended
(In millions)	June 30, 2019			June 30, 2018
Net loss	$	(19.1	)	$	(37.0	)
Other comprehensive income (loss):
Foreign currency translation adjustments	4.1			(45.5		)
Unrealized gains (losses) on revaluation of long-term intercompany balances, net of taxes of $0.0	.3			(81.1		)
Change in unrealized gains/losses on cash flow hedges, net of taxes of $0.0	(.7		)	—
Adjustments of and amortization of net actuarial loss and prior service cost, net of taxes of $0.2 and $0.1	1.8			2.8
Total other comprehensive income (loss), net of income taxes	5.5			(123.8		)
Comprehensive (loss)	(13.6		)	(160.8		)
Less: comprehensive income (loss) attributable to noncontrolling interests	.3			(1.2		)
Comprehensive loss attributable to Avon	$	(13.9	)	$	(159.6	)

The accompanying notes are an integral part of these statements.

5

AVON PRODUCTS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(Unaudited)

	Six Months Ended
(In millions)	June 30, 2019			June 30, 2018
Net loss	$	(52.6	)	$	(58.1	)
Other comprehensive income (loss):
Foreign currency translation adjustments	1.2			(49.8		)
Unrealized (losses) on revaluation of long-term intercompany balances, net of taxes of $0.0	(.2		)	(44.1		)
Change in unrealized gains/losses on cash flow hedges, net of taxes of $0.0	(2.6		)	—
Adjustments of and amortization of net actuarial loss and prior service cost, net of taxes of $0.3 and $0.3	3.1			5.7
Total other comprehensive income (loss), net of income taxes	1.5			(88.2		)
Comprehensive loss	(51.1		)	(146.3		)
Less: comprehensive loss attributable to noncontrolling interests	(.4		)	(1.8		)
Comprehensive loss attributable to Avon	$	(50.7	)	$	(144.5	)

The accompanying notes are an integral part of these statements.

6

AVON PRODUCTS, INC.

CONSOLIDATED BALANCE SHEETS

December 31, 2018 (Audited) and June 30, 2019 (Unaudited)

(In millions)	June 30, 2019			December 31, 2018
Assets
Current Assets
Cash and cash equivalents	$	421.0		$	532.7
Accounts receivable, net	332.8			349.7
Inventories	515.6			542.0
Prepaid expenses and other	264.2			272.0
Assets held for sale	10.1			65.6
Total current assets	1,543.7			1,762.0
Property, plant and equipment, at cost	1,177.8			1,207.8
Less accumulated depreciation	(657.6		)	(650.2		)
Property, plant and equipment, net	520.2			557.6
Right-of-use assets	174.9			—
Goodwill	89.9			87.4
Deferred tax asset	208.2			212.6
Other assets	434.3			390.4
Total assets	$	2,971.2		$	3,010.0
Liabilities, Series C Convertible Preferred Stock and Shareholders’ Deficit
Current Liabilities
Debt maturing within one year	$	398.5		$	12.0
Accounts payable	682.2			816.5
Accrued compensation	94.1			85.5
Other accrued liabilities	436.1			451.3
Sales taxes and taxes other than income	116.0			103.9
Income taxes	11.7			15.9
Held for sale liabilities	—			11.4
Current liabilities of discontinued operations	18.1			—
Total current liabilities	1,756.7			1,496.5
Long-term debt	1,197.0			1,581.6
Long-term operating lease liability	144.8			—
Employee benefit plans	129.6			128.3
Long-term income taxes	140.9			136.2
Other liabilities	54.8			72.1
Total liabilities	3,423.8			3,414.7
Series C convertible preferred stock	504.7			492.1
Shareholders’ Deficit
Common stock	190.7			190.3
Additional paid-in capital	2,307.5			2,303.6
Retained earnings	2,169.5			2,234.3
Accumulated other comprehensive loss	(1,028.9		)	(1,030.4		)
Treasury stock, at cost	(4,603.3		)	(4,602.3		)
Total Avon shareholders’ deficit	(964.5		)	(904.5		)
Noncontrolling interests	7.2			7.7
Total shareholders’ deficit	(957.3		)	(896.8		)
Total liabilities, series C convertible preferred stock and shareholders’ deficit	$	2,971.2		$	3,010.0

7

The accompanying notes are an integral part of these statements.

8

AVON PRODUCTS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three Months Ended						Six Months Ended
(In millions)	June 30, 2019			June 30, 2018			June 30, 2019			June 30, 2018
Cash Flows from Operating Activities
Net loss	$	(19.1	)	$	(37.0	)	$	(52.6	)	$	(58.1	)
Loss from discontinued operations, net of tax	(13.2		)	—			(22.7		)	—
Loss from continuing operations, net of tax	(5.9		)	(37.0		)	(29.9		)	(58.1		)
Adjustments to reconcile net loss to net cash used by operating activities:
Depreciation	15.9			20.8			36.5			41.6
Amortization	6.2			6.7			12.8			13.8
Provision for doubtful accounts	28.8			43.1			58.7			86.2
Provision for obsolescence	9.5			3.6			16.2			13.3
Share-based compensation	5.7			3.7			5.2			7.5
Foreign exchange losses (gains)	11.9			8.9			(7.3		)	13.5
Deferred income taxes	(.9		)	(2.0		)	7.3			(.2		)
Impairment loss on assets	13.3			—			13.3			—
Gain on sale of business / assets	(13.2		)	—			(23.5		)	—
Other	3.5			—			5.2			3.2
Changes in assets and liabilities:
Accounts receivable	(16.6		)	(45.6		)	(40.9		)	(50.0		)
Inventories	13.2			(41.3		)	18.0			(99.7		)
Prepaid expenses and other	(23.2		)	1.6			15.2			1.7
Accounts payable and accrued liabilities	(47.1		)	29.7			(211.3		)	(76.6		)
Income and other taxes	19.2			.6			7.2			(.3		)
Noncurrent assets and liabilities	(13.2		)	(3.2		)	(18.3		)	(2.6		)
Net cash provided (used) by operating activities of continuing operations	7.1			(10.4		)	(135.6		)	(106.7		)
Cash Flows from Investing Activities
Capital expenditures	(11.3		)	(20.2		)	(32.5		)	(48.0		)
Disposal of assets	.4			.6			.8			1.4
Net proceeds from sale of business / assets	30.1			—			76.5			—
Other investing activities	—			(3.3		)	—			(3.3		)
Net cash provided (used) by investing activities of continuing operations	19.2			(22.9		)	44.8			(49.9		)
Cash Flows from Financing Activities
Debt, net (maturities of three months or less)	(26.7		)	(14.0		)	.5			(10.4		)
Repayment of debt	(.3		)	(238.1		)	(.3		)	(238.6		)
Repurchase of common stock	(1.1		)	(.5		)	(1.1		)	(3.2		)
Other financing activities	—			(.1		)	(9.2		)	(.1		)
Net cash used by financing activities of continuing operations	(28.1		)	(252.7		)	(10.1		)	(252.3		)
Cash Flows from Discontinued Operations
Net cash used by operating activities of discontinued operations	(4.6		)	—			(4.6		)	—
Net cash used by discontinued operations	(4.6		)	—			(4.6		)	—
Effect of exchange rate changes on cash and cash equivalents, and restricted cash	4.0			(42.6		)	(2.3		)	(28.7		)
Net decrease in cash and cash equivalents, and restricted cash	(2.4		)	(328.6		)	(107.8		)	(437.6		)
Cash and cash equivalents, and restricted cash at beginning of period(1)	431.0			772.5			536.4			881.5
Cash and cash equivalents, and restricted cash at end of period (2)	$	428.6		$	443.9		$	428.6		$	443.9

 

9

The accompanying notes are an integral part of these statements.

⁽¹⁾  The balance at the beginning of the six month period ended June 30, 2019 includes cash and cash equivalents of $3.7 classified as Held for sale assets in our Consolidated Balance Sheets at the end of the year in 2018

⁽²⁾  Includes restricted cash of $7.6 related to the sale of Avon Manufacturing (Guangzhou), Ltd. at June 30, 2019. Refer to Note 4, Restricted Cash

10

AVON PRODUCTS, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (DEFICIT)

(Unaudited)

(In millions, except per	Common Stock			Additional			Retained			Accumulated Other			Treasury Stock				Noncontrolling
share data)	Shares	Amount		Paid-In Capital			Earnings			Comprehensive Loss			Shares	Amount			Interests			Total
Balances at December 31, 2018	761.8	$	190.3	$	2,303.6		$	2,234.3		$	(1,030.4	)	319.4	$	(4,602.3	)	$	7.7		$	(896.8	)
Net loss	—	—		—			(32.7		)	—			—	—			(.8		)	(33.5		)
Other comprehensive (loss) income	—	—		—						(4.0		)	—	—			.1			(3.9		)
Dividends accrued - Series C convertible preferred stock	—	—		—			(6.2		)	—			—	—			—			(6.2		)
Exercise/ vesting/ expense of share-based compensation	1.3	.3		(1.5		)	—			—			—	—			—			(1.2		)
Purchases and sales of noncontrolling interests, net of dividends paid of $0.0	—	—		—			—			—			—	—			.1			0.1
Balances at March 31, 2019	763.1	$	190.6	$	2,302.1		$	2,195.4		$	(1,034.4	)	319.4	$	(4,602.3	)	$	7.1		$	(941.5	)
Net (loss) income	—	—		—			(19.5		)	—			—	—			.4			(19.1		)
Other comprehensive income	—	—		—			—			5.5			—	—			—			5.5
Dividends accrued - Series C convertible preferred stock	—	—		—			(6.4		)	—			—	—			—			(6.4		)
Exercise/ vesting/ expense of share-based compensation	—	—		5.4			—			—			—	—			—			5.4
Repurchase of common stock	.1	.1		—			—			—			.5	(1.0		)	—			(1.0		)
Purchases and sales of noncontrolling interests, net of dividends paid of $0.1	—	—		—			—			—			—	—			(.3		)	(.3		)
Balances at June 30, 2019	763.2	$	190.7	$	2,307.5		$	2,169.5		$	(1,028.9	)	319.9	$	(4,603.3	)	$	7.2		$	(957.3	)

The accompanying notes are an integral part of these statements.

11

(In millions, except per	Common Stock			Additional		Retained			Accumulated Other			Treasury Stock					Noncontrolling
share data)	Shares	Amount		Paid-In Capital		Earnings			Comprehensive Loss			Shares		Amount			Interests			Total
Balances at December 31, 2017	758.7	$	189.7	$	2,291.2	$	2,320.3		$	(926.2	)	318.4		$	(4,600.0	)	$	10.3		$	(714.7	)
Net loss	—	—		—		(20.3		)	—			—		—			(.8		)	(21.1		)
Revenue Recognition Cumulative catch up	—	—		—		(41.1		)	—			—		—			—			(41.1		)
Other comprehensive income	—	—		—					35.2								.4			35.6
Dividends accrued - Series C convertible preferred stock	—	—		—		(6.0		)	—			—		—			—			(6.0		)
Exercise/ vesting/ expense of share-based compensation	2.2	.6		2.5		(.4		)	—			(.1	)	.9			—			3.6
Repurchase of common stock	—	—		—		—			—			.9		(2.7		)	—			(2.7		)
Purchases and sales of noncontrolling interests, net of dividends paid of $0.0	—	—		—		—			—			—		—			(.2		)	(.2		)
Balances at March 31, 2018	760.9	$	190.3	$	2,293.7	$	2,252.5		$	(891.0	)	319.2		$	(4,601.8	)	$	9.7		$	(746.6	)
Net loss	—	—		—		(36.1		)	—			—		—			(.9		)	(37.0		)
Other comprehensive loss	—	—		—		—			(123.4		)	—		—			(.4		)	(123.8		)
Dividends accrued - Series C convertible preferred stock	—	—		—		(6.0		)	—			—		—			—			(6.0		)
Exercise/ vesting/ expense of share-based compensation	.8	—		3.8		(.4		)	—			—		—			—			3.4
Repurchase of common stock	—	—		—		—			—			.2		(.5		)	—			(.5		)
Balances at June 30, 2018	761.7	$	190.3	$	2,297.5	$	2,210.0		$	(1,014.4	)	319.4		$	(4,602.3	)	$	8.4		$	(910.5	)

The accompanying notes are an integral part of these statements.

12

AVON PRODUCTS, INC.

1. 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 2018 Annual Report on Form 10-K ("2018 Form 10-K") in preparing these unaudited interim Consolidated Financial Statements, other than those impacted by new accounting standards as described below. 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 2018 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 generally provide for accruals under our various employee benefit plans for each quarter based on one quarter of the estimated annual expense, and adjust these accruals as estimates are refined. 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 for which an effective tax rate cannot be reliably estimated.

Accounting Standards Implemented

Leases

In February 2016, the FASB issued ASU 2016-02, Leases, which requires all assets and liabilities arising from leases to be recognized in our Consolidated Balance Sheets. We adopted this new accounting guidance effective January 1, 2019.

In July 2018, the FASB added an optional transition method which we elected upon adoption of the new standard. This allowed us to recognize and measure leases existing at January 1, 2019 without restating comparative information. In addition, we elected to apply the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allows us to carry forward the historical lease classification.

We determine if an arrangement is a lease at the lease commencement date. In addition to our lease agreements, we review all material new vendor arrangements for potential embedded lease obligations. The asset balance related to operating and finance leases is presented within right-of-use (ROU) asset and property, plant and equipment, respectively, on our Consolidated Balance Sheet. The short-term liability balance related to operating and finance leases is presented within other accrued liabilities on our Consolidated Balance Sheets. The long-term liability balance is presented within long-term operating lease liability and long-term debt on our Consolidated Balance Sheets for operating and finance leases, respectively.  

The lease liability is recognized based on the present value of the remaining fixed or in-substance fixed lease payments discounted using our incremental borrowing rates. We use a specific incremental borrowing rate for our material leases, which is determined based on the geography and term of the lease. These rates are determined based on inputs provided by external banks and updated periodically. The lease liability includes the exercise of a purchase option only if we are reasonably certain to exercise as of the commencement date of the lease. The residual value guarantee amount is only included in the lease liability calculation to the extent payment is probable to the lessor as of the commencement of the lease. The ROU asset is calculated based on the lease liability adjusted for any lease payments paid to the lessor at or before the commencement date (i.e. prepaid rent) and initial direct costs incurred by Avon and excluding any lease incentives received from the Lessor.

Variable lease payments are payments to the lessor not included in the lease liability calculation. We define variable lease payments as payments made by Avon to the lessor for the right to use a leased asset that vary because of changes in facts or circumstances (such as changes in an index rate, volume, usage, etc.) occurring after the lease commencement date, other than predetermined contractual changes due to the passage of time (for example, predetermined rent increase amounts that are set out in the contract). Variable lease payments or charges are accounted for as incurred.

13

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

The lease term for purposes of lease accounting may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option as of the commencement date of the lease. For operating leases, the lease expense is recognized on a straight-line basis over the lease term. For finance leases, the Company amortizes the ROU asset on a straight-line basis and records interest expense on the lease liability created at lease commencement over the lease term.

We account for our lease and non-lease components as a single component for most of our asset classes, and therefore both are included in the calculation of lease liability recognized on the Consolidated Balance Sheets. However, for certain lease asset classes related to identified embedded leases we account for the lease and non-lease components separately, and therefore, the non-lease component is not included in the lease liability.

Leases with an initial term of twelve months or less are not recorded on the balance sheet; we recognize lease expense for these leases over their lease term. See Note 9, Leases, for further details.

ASU 2018-02, Income Statement - Reporting Comprehensive Income

In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income, which permits entities to reclassify the disproportionate income tax effects of the 2017 enactment of U.S. tax reform legislation (the "Act") on items within accumulated other comprehensive income (loss) to retained earnings. We adopted this new accounting guidance effective January 1, 2019 and elected not to reclassify the disproportionate income tax effects of the Act from accumulated other comprehensive income (loss) to retained earnings.

Accounting Standards to be Implemented

ASU 2016-13, Financial Instruments - Credit Losses

In January 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses, which requires measurement and recognition of expected credit losses for financial assets held. We intend to adopt this new accounting guidance effective January 1, 2020. We are currently assessing the impact on our consolidated financial statements.

14

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

2. LOSS PER SHARE AND SHARE REPURCHASES

We compute loss per share ("EPS") using the two-class method, which is a loss allocation formula that determines loss per share for common stock, and 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 June 30,						Six Months Ended June 30,
(Shares in millions)	2019			2018			2019			2018
Numerator from continuing operations:
Loss from continuing operations, less amounts attributable to noncontrolling interests	$	(6.3	)	$	(36.1	)	$	(29.5	)	$	(56.4	)
Less: Loss allocated to participating securities	(.1		)	(.4		)	(.4		)	(.6		)
Less: Cumulative dividends on preferred stock	6.3			6.0			12.6			12.0
Loss from continuing operations allocated to common shareholders	(12.5		)	(41.7		)	(41.7		)	(67.8		)
Numerator from discontinued operations:
Loss from discontinued operations	$	(13.2	)	$	—		$	(22.7	)	$	—
Less: Loss allocated to participating securities	(.2		)	—			(.3		)	—
Loss allocated to common shareholders	(13.0		)	—			(22.4		)	—
Numerator attributable to Avon:
Net loss attributable to Avon	$	(19.5	)	$	(36.1	)	$	(52.2	)	$	(56.4	)
Less: Loss allocated to participating securities	(.3		)	(.4		)	(.7		)	(.6		)
Less: Cumulative dividends on preferred stock	6.3			6.0			12.6			12.0
Loss allocated to common shareholders	(25.5		)	(41.7		)	(64.1		)	(67.8		)
Denominator:
Basic EPS weighted-average shares outstanding	442.3			442.2			442.5			441.5
Diluted effect of assumed conversion of stock options	.2			—			.1			—
Diluted effect of assumed conversion of preferred stock	—			—			—			—
Diluted EPS adjusted weighted-average shares outstanding	442.5			442.2			442.6			441.5
Loss per Common Share from continuing operations:
Basic	$	(.03	)	$	(.09	)	$	(.09	)	$	(.15	)
Diluted	(.03		)	(.09		)	(.09		)	(.15		)
Loss per Common Share from discontinued operations:
Basic	$	(.03	)	$	—		$	(.05	)	$	—
Diluted	(.03		)	—			(.05		)	—
Loss per Common Share attributable to Avon:
Basic	$	(.06	)	$	(.09	)	$	(.14	)	$	(.15	)
Diluted	(.06		)	(.09		)	(.14		)	(.15		)

Amounts in the table above may not necessarily sum due to rounding.

During the three and six months ended June 30, 2019, we did not include stock options to purchase 19.4 million and 18.8 million shares, respectively, of Avon common stock in the calculation of diluted EPS as we had a net loss and the inclusion of these shares would decrease the net loss per share. Since the inclusion of such shares would be anti-dilutive, these are excluded from the calculation. During the three and six months ended June 30, 2018, we did not include stock options to purchase 18.5 million shares and 17.4 million shares, respectively, for the same reason.

15

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

For the three and six months ended June 30, 2019 and 2018, respectively, it is more dilutive to assume the series C convertible preferred stock is not converted into common stock; therefore, the weighted-average shares outstanding were not adjusted by the as-if converted series C convertible preferred stock because the effect would be anti-dilutive. The inclusion of the series C convertible preferred stock would decrease the net loss per share for the three months ended June 30, 2019 and 2018. 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 and six months ended June 30, 2019 and 2018. See Note 6, Related Party Transactions.

We purchased approximately .4 million shares of Avon common stock for $1.1 during the first six months of 2019, as compared to approximately 1.1 million shares of Avon common stock for $3.2 during the first six months of 2018, through acquisition of stock from employees in connection with tax payments upon the vesting of restricted stock units and performance restricted stock units.

3. DISCONTINUED OPERATIONS, ASSETS AND LIABILITIES HELD FOR SALE AND DIVESTITURES

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 6, 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 (an affiliate of Cerberus). These transactions closed on March 1, 2016.

The Company incurred costs during the three and six months ended June 30, 2019 following the resolution of certain contingent liabilities related to its ownership and operation of the North America business prior to its separation into New Avon. These costs are reported as discontinued operations related to New Avon.

The major classes of financial statement components comprising the loss on discontinued operations, net of tax for New Avon are shown below:

	Three Months Ended June 30, 2019			Six Months Ended June 30, 2019
Selling, general and administrative expenses	$	13.2		$	22.7
Operating loss	$	(13.2	)	$	(22.7	)
Loss from discontinued operations, net of tax	$	(13.2	)	$	(22.7	)

There were no amounts recorded in discontinued operations for the three and six months ended June 30, 2018. See Note 5, Investment in New Avon, for additional information relating to New Avon.

Assets and Liabilities Held for Sale

The major classes of assets and liabilities comprising Held for sale assets and Held for sale liabilities on the Consolidated Balance Sheets as of June 30, 2019 and December 31, 2018 are shown in the following table.

	June 30, 2019
Current Held for sale assets
Property, Plant & Equipment (net)	$	10.1
	$	10.1

16

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

	December 31, 2018
	Avon Manufacturing (Guangzhou)		Rye Office		Malaysia Maximin		Total
Current held for sale assets
Inventories	$	8.7	$	—	$	—	$	8.7
Property, Plant & Equipment (net)	36.7		12.3		3.0		52.0
Cash and cash equivalents	3.7		—		—		3.7
Other assets	1.1		—		.1		1.2
	$	50.2	$	12.3	$	3.1	$	65.6
Current held for sale liabilities
Accounts payable	$	8.6	$	—	$	—	$	8.6
Other liabilities	2.6		—		.2		2.8
	$	11.2	$	—	$	.2	$	11.4

During the second quarter of 2019, the Company, in line with the Open Up Avon strategy, identified two properties to be sold which met the held for sale criteria under ASC 360 as of June 30, 2019. The Company expects to close these transactions within the year.

Refer to Divestitures section below for the sale of Avon Manufacturing (Guangzhou), Rye Office and Malaysia Maximin.

Divestitures

Rye Office

On June 26, 2019, we completed the sale of the Rye office for a selling price of $23.2, less expenses of approximately $0.8, resulting in proceeds of $22.4. These proceeds are presented as investing activities in the Consolidated Statement of Cash Flows.

In the second quarter of 2019, we recorded a gain on sale of $9.9 before and after tax, which is reported separately in the Consolidated Statements of Operations. The gain recorded represents the difference between the proceeds and the carrying value of the Rye office on the date of sale. During the first quarter of 2019, we refined the calculation for the Held for sale assets which gave rise to an additional $0.2 in assets.

Malaysia Maximin

On May 9, 2019, we completed the sale of all of the equity interests in Maximin Corporation Sdn Bhd ("Malaysia Maximin") for a total purchase price of $7.8. The cash proceeds of $7.6, net of expenses, are presented within investing activities in the Consolidated Statement of Cash Flows.

In the second quarter of 2019, we recorded a gain on sale of $3.3 before tax, which is reported separately in the Consolidated Statements of Operations, and $3.0 after tax. The gain recorded represents the difference between the proceeds and the carrying value of Malaysia Maximin on the date of sale. During the second quarter of 2019, we refined the calculation for the Held for sale assets which gave rise to an additional $1.4 in assets.

China manufacturing

On February 15, 2019, we completed the sale to TheFaceShop Co., Ltd., an affiliate of LG Household & Health Care Ltd., of all of the equity interests in Avon Manufacturing (Guangzhou), Ltd. for a total purchase price of $71.0, less expenses of approximately $1.1. The purchase price included $23.5 relating to outstanding intercompany loans payable to Avon Manufacturing (Guangzhou), Ltd. from other Avon subsidiaries, that was presented as financing activities in the Consolidated Statement of Cash Flows when settled in April 2019. The cash proceeds of $46.4, net of loan amounts, are presented as investing activities in the Consolidated Statement of Cash Flows, which includes $7.6 of restricted cash as of June 30, 2019, refer to Note 4, Restricted Cash.

In the first quarter of 2019, we recorded a gain on sale of $10.3 before tax, which is reported separately in the Consolidated Statements of Operations, and $8.2 after tax, representing the difference between the proceeds, including the settlement of the intercompany loans, and the carrying value of Avon Manufacturing (Guangzhou), Ltd. on the date of sale.

17

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

4. RESTRICTED CASH

Restricted cash is related to the sale of Avon Manufacturing (Guangzhou), Ltd. as described in Note 3, Discontinued Operations, Assets and Liabilities Held for Sale and Divestitures.

Restricted cash is subject to legal restrictions imposed by the Equity Purchase Agreement between TheFaceShop Co., Ltd., an affiliate of LG Household & Health Care Ltd., Avon Asia Holdings Company and Avon Products (China) Co., Ltd. related to the sale of Avon Manufacturing (Guangzhou), Ltd. These deposits are not available for general use by the Company.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the Consolidated Balance Sheet that sum to the total of the same such amounts shown in the Consolidated Statement of Cash Flows for the six month period ended June 30, 2019.

	June 30, 2019		December 31, 2018
Cash and cash equivalents	$	421.0	$	532.7
Long-term restricted cash(1)	7.6		—
Held for sale cash and cash equivalents	—		3.7
Cash and cash equivalents, and restricted cash at end of period per the statement of cash flows	$	428.6	$	536.4

⁽¹⁾ Long-term restricted cash is presented in other assets in our Consolidated Balance Sheets.

5. INVESTMENT IN NEW AVON

In connection with the separation of the Company's North America business, which closed on March 1, 2016, the Company retained a 19.9% ownership interest in New Avon, a privately-held company that is majority-owned and managed by an affiliate of Cerberus.

Our recorded investment balance in New Avon at June 30, 2019 and December 31, 2018 was zero.

In April 2019, we signed an agreement with LG Household & Health Care Ltd. to sell our 19.9% ownership interest in New Avon.

LG Household & Health Care Ltd. will acquire all of the interests of New Avon for $125.0 in cash, of which Avon will receive $24.9 in cash for our 19.9% share. The closing is expected to occur during the third quarter of 2019.

In the second quarter of 2019 we incurred costs relating to this transaction of $1.0.

18

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

6. RELATED PARTY TRANSACTIONS

The following tables present the related party transactions with New Avon, affiliates of Cerberus and the Instituto Avon in Brazil. There are no other related party transactions. New Avon is majority-owned and managed by Cerberus. See Note 5, Investment in New Avon for further details.

	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
Statement of Operations Data
Revenue from sale of product to New Avon(1)	$	3.7		$	7.1		$	8.5		$	13.0
Gross profit from sale of product to New Avon(1)	$	—		$	.4		$	.1		$	.7
Cost of sales for purchases from New Avon(2)	$	.8		$	.7		$	1.5		$	1.2
Selling, general and administrative expenses related to New Avon:
Transition services, intellectual property, technical support and innovation and subleases(3)	$	(.1	)	$	(.5	)	$	(.2	)	$	(3.7	)
Project management team(4)	2.1			.2			$	3.4		$	.8
Net reduction of selling, general and administrative expenses	$	2.0		$	(.3	)	$	3.2		$	(2.9	)
Interest income from Instituto Avon(5)	$	.1		$	—		$	.1		$	—

	June 30, 2019		December 31, 2018
Balance Sheet Data
Inventories(6)	$	.2	$	.3
Receivables due from New Avon(7)	$	3.0	$	7.0
Receivables due from Instituto Avon(5)	$	3.3	$	3.2
Payables due to New Avon(8)	$	1.0	$	.2
Payables due to an affiliate of Cerberus(9)	$	4.1	$	.6

(1) The Company supplies product to New Avon as part of a manufacturing and supply agreement.

(2) New Avon supplies product to the Company as part of the same manufacturing and supply agreement noted above. The Company purchased $.6 and $.5 from New Avon associated with this agreement during the three months ended June 30, 2019 and 2018, respectively, and recorded $.8 and $.7 associated with these purchases within cost of sales in our Consolidated Statement of Operations during the three months ended June 30, 2019 and 2018, respectively. The Company purchased $1.4 and $1.2 from New Avon associated with this agreement during the six months ended June 30, 2019 and 2018, respectively, and recorded $1.5 and $1.2 associated with these purchases within cost of sales in our Consolidated Statement of Operations during the six months ended June 30, 2019 and 2018, respectively.

(3) The Company also entered into a transition services agreement to provide certain services to New Avon, which expired on October 31, 2018, as well as an intellectual property ("IP") license agreement, an agreement for technical support and innovation and sublease for office space. The net amounts recorded within selling, general and administrative expenses generally represent 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 implementation of the Company’s strategic initiatives. The Company recorded net cost of $2.1 and $.2 in selling, general and administrative expenses associated with these agreements during the three months ended June 30, 2019 and 2018, respectively, and recorded $3.4 and $.8 in selling, general and administrative expenses associated with these agreements during the six months ended June 30, 2019 and 2018, respectively. See Note 15, Restructuring Initiatives for additional information related to the Company's strategic initiatives.

(5) During the second quarter of 2018, the Company entered into an agreement to loan the Instituto Avon, an independent non-government charitable organization in Brazil, R$12 million (Brazilian real) for an unsecured 5-year term at a fixed interest rate of 7% per annum, to be paid back in 5 equal annual installments. The Instituto Avon was created by an Avon subsidiary in Brazil,

19

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

with the board and executive team comprised of Avon Brazil management. The purpose of the loan is to provide the Instituto Avon with the means to donate funds to Fundação Pio XII (a leading cancer prevention and treatment organization in Brazil and owner of the Hospital do Câncer de Barretos), in order to invest in equipment with the objective of expanding breast cancer prevention and treatment.

(6) 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 our Consolidated Balance Sheets.

(7) The receivables due from New Avon relate to the agreements for transition services, the IP license agreement, technical support and innovation and subleases for office space, as well as the manufacturing and supply agreement, and were classified within prepaid expenses and other in our Consolidated Balance Sheets.

(8) The payables due to New Avon relate to the manufacturing and supply agreement and were classified within other accrued liabilities in our Consolidated Balance Sheets.

(9) 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 our 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 June 30, 2019, the Company has a liability of $.8 for the estimated value of such standby letters of credit.

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 $78.0 as of June 30, 2019. Series C convertible preferred stock and accrued dividends of $504.7 on the Consolidated Balance Sheet at June 30, 2019 is stated net of $8.7 of costs incurred in connection with the issuance of the Series C convertible preferred stock in 2016. There were no dividends declared in the six months ended June 30, 2019 and 2018.

20

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

7. REVENUE

Disaggregation of revenue

In the following table, revenue is disaggregated by product or service type. All revenue is recognized at a point in time when control of a product is transferred to a customer:

	Three Months Ended June 30, 2019
	Reportable segments
	Europe, Middle East & Africa		South Latin America			North Latin America		Asia Pacific		Total reportable segments			Other operating segments and business activities		Total
Beauty:
Skincare	$	136.6	$	130.1		$	49.9	$	29.3	$	345.9		$	—	$	345.9
Fragrance	123.8		114.5			45.6		19.2		303.1			—		303.1
Color	82.0		66.7			21.2		10.9		180.8			—		180.8
Total Beauty	342.4		311.3			116.7		59.4		829.8			—		829.8
Fashion & Home:
Fashion	55.2		41.3			19.9		39.8		156.2			—		156.2
Home	6.4		62.0			47.0		7.4		122.8			—		122.8
Total Fashion & Home	61.6		103.3			66.9		47.2		279.0			—		279.0
Product sales	404.0		414.6			183.6		106.6		1,108.8			—		1,108.8
Representative fees	21.0		28.8			10.2		1.7		61.7			—		61.7
Other	.1		(.4		)	—		.1		(.2		)	4.5		4.3
Other revenue	21.1		28.4			10.2		1.8		61.5			4.5		66.0
Total revenue	$	425.1	$	443.0		$	193.8	$	108.4	$	1,170.3		$	4.5	$	1,174.8

	Three Months Ended June 30, 2018
	Reportable segments
	Europe, Middle East & Africa		South Latin America		North Latin America		Asia Pacific		Total reportable segments		Other operating segments and business activities		Total
Beauty:
Skincare	$	154.4	$	143.9	$	43.8	$	30.3	$	372.4	$	2.3	$	374.7
Fragrance	143.8		131.5		52.4		20.1		347.8		.7		348.5
Color	98.1		80.6		20.8		12.9		212.4		1.4		213.8
Total Beauty	396.3		356.0		117.0		63.3		932.6		4.4		937.0
Fashion & Home:
Fashion	72.9		49.9		22.5		40.7		185.8		1.3		187.1
Home	7.6		72.5		56.6		7.5		144.3		.4		144.7
Total Fashion & Home	80.5		122.4		79.1		48.2		330.1		1.7		331.8
Product sales	476.8		478.4		196.1		111.5		1,262.7		6.1		1,268.8
Representative fees	23.7		35.2		11.2		1.5		71.6		.5		72.1
Other	.2		2.6		—		.1		2.9		8.1		11.0
Other revenue	23.9		37.8		11.2		1.6		74.5		8.6		83.1
Total revenue	$	500.7	$	516.1	$	207.3	$	113.1	$	1,337.2	$	14.7	$	1,351.9

21

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

	Six Months Ended June 30, 2019
	Reportable segments
	Europe, Middle East & Africa		South Latin America		North Latin America		Asia Pacific		Total reportable segments		Other operating segments and business activities		Total
Beauty:
Skincare	$	275.7	$	256.8	$	100.2	$	62.5	$	695.2	$	—	$	695.2
Fragrance	257.7		212.8		93.6		37.0		601.1		—		601.1
Color	175.9		126.9		43.1		24.1		370.0		—		370.0
Total Beauty	709.3		596.5		236.9		123.6		1,666.3		—		1,666.3
Fashion & Home:
Fashion	115.7		80.1		42.0		82.7		320.5		—		320.5
Home	14.9		122.2		87.3		13.8		238.2		—		238.2
Total Fashion & Home	130.6		202.3		129.3		96.5		558.7		—		558.7
Product sales	839.9		798.8		366.2		220.1		2,225.0		—		2,225.0
Representative fees	43.5		58.3		20.3		3.5		125.6		—		125.6
Other	.4		.6		—		.1		1.1		10.0		11.1
Other revenue	43.9		58.9		20.3		3.6		126.7		10.0		136.7
Total revenue	$	883.8	$	857.7	$	386.5	$	223.7	$	2,351.7	$	10.0	$	2,361.7

	Six Months Ended June 30, 2018
	Reportable segments
	Europe, Middle East & Africa		South Latin America		North Latin America		Asia Pacific		Total reportable segments		Other operating segments and business activities		Total
Beauty:
Skincare	$	323.8	$	285.7	$	90.5	$	61.6	$	761.5	$	7.0	$	768.5
Fragrance	307.0		250.0		106.0		38.7		701.8		2.9		704.7
Color	218.8		161.5		41.6		26.1		448.1		4.7		452.8
Total Beauty	849.6		697.2		238.1		126.4		1,911.4		14.6		1,926.0
Fashion & Home:
Fashion	152.6		96.4		45.1		80.4		374.5		3.0		377.5
Home	16.9		144.4		97.9		14.5		273.6		1.3		274.9
Total Fashion & Home	169.5		240.8		143.0		94.9		648.1		4.3		652.4
Product sales	1,019.1		938.0		381.1		221.3		2,559.5		18.9		2,578.4
Representative fees	49.7		71.5		21.8		3.1		146.1		1.9		148.0
Other	.3		3.7		—		.1		4.1		14.9		19.0
Other revenue	50.0		75.2		21.8		3.2		150.2		16.8		167.0
Total revenue	$	1,069.1	$	1,013.2	$	402.9	$	224.5	$	2,709.7	$	35.7	$	2,745.4

Contract balances

The timing of revenue recognition generally is different from the timing of a promise made to a Representative. As a result, we have contract liabilities, which primarily relate to the advance consideration received from Representatives prior to transfer of the

22

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

related good or service for material rights, such as loyalty points and status programs, and are primarily classified within other accrued liabilities (with the long-term portion in other liabilities) in our Consolidated Balance Sheets.

Generally, we record accounts receivable when we invoice a Representative. In addition, we record an estimate of an allowance for doubtful accounts on receivable balances based on an analysis of historical data and current circumstances, including seasonality and changing trends. The allowance for doubtful accounts is reviewed for adequacy, at a minimum, on a quarterly basis. We generally have no detailed information concerning, or any communication with, any ultimate consumer of our products beyond the Representative. We have no legal recourse against the ultimate consumer for the collection of any accounts receivable balances due from the Representative to us. If the financial condition of the Representatives were to deteriorate, resulting in their inability to make payments, additional allowances may be required.

The following table provides information about receivables and contract liabilities from contracts with customers at June 30, 2019 and December 31, 2018:

	June 30, 2019		December 31, 2018
Accounts receivable, net of allowances of $72 and $93	$	332.8	$	349.7
Contract liabilities	$	55.7	$	84.4

The contract liability balances relate to certain material rights (loyalty points, status program and prospective discounts). During the six months ended June 30, 2019, we recognized $63.4 of revenue related to the contract liability balance at the beginning of the six month period ended June 30, 2019, as the result of performance obligations satisfied. In addition, we deferred an additional $34.5 related to certain material rights granted during the period, for which the performance obligations are not yet satisfied. Of the amount deferred during the period, substantially all will be recognized within a year, with the significant majority to be captured within a quarter. The remaining movement in the contract liability balance is attributable to foreign exchange differences arising on the translation of the balance as at June 30, 2019 as compared with December 31, 2018.

Contract costs

Incremental costs to obtain contracts, such as bonuses or commissions, are recognized as an asset if the entity expects to recover them. However, ASC 340-40, Other Assets and Deferred Costs, offers a practical expedient to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that the entity otherwise would have recognized is one year or less. We elected the practical expedient and expense costs to obtain contracts when incurred because our amortization period is one year or less.

Costs to fulfill contracts with Representatives are comprised of shipping and handling (including order processing) and payment processing services, which are expensed as incurred. The fees for these services are included in the transaction price.

8. INVENTORIES

Components of Inventories	June 30, 2019		December 31, 2018
Raw materials	$	150.8	$	157.8
Finished goods	364.8		384.2
Total	$	515.6	$	542.0

23

AVON PRODUCTS, INC.

9. LEASES

We have operating and finance leases for corporate and market offices, warehouses, automotive and other equipment. Some of our leases may include options to extend or terminate the lease. Certain leases also include options to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.

	Classification	June 30, 2019		January 1, 2019
Assets
Operating right-of-use assets	Right-of-use asset	$	174.9	$	187.5
Finance right-of-use assets	Property, Plant and Equipment	3.0		3.2
Total right-of-use assets		177.9		190.7
Liabilities
Current
Operating lease liabilities	Other accrued liabilities	$	43.8	$	45.4
Finance lease liabilities	Other accrued liabilities	1.2		1.1
Total current lease liabilities		45.0		46.5
Noncurrent
Operating lease liabilities	Long-term operating lease liability	$	144.8	$	155.9
Finance lease liabilities	Long-term debt	1.8		1.9
Total noncurrent lease liabilities		$	146.6	$	157.8
Total lease liability		$	191.6	$	204.3

The table below shows the lease income and expenses recorded in the Consolidated Statement of Operations incurred during the three and six months ended June 30, 2019.

		Three months ended June 30,			Six months ended June 30,
Lease Costs	Classification	2019			2019
Operating lease cost (1)	Selling, general and administrative expenses	$	16.6		$	33.3
Finance lease cost
Amortization of right-of-use assets	Selling, general and administrative expenses	.4			.9
Interest on lease liabilities	Interest Expense	.1			.2
Short-term leases costs	Selling, general and administrative expenses	.8			1.9
Sublease income (2)	Selling, general and administrative expenses	(2.6		)	(5.8		)
Net lease cost		$	15.3		$	30.5

⁽¹⁾ Includes variable lease costs which are immaterial. These are presented in selling, general and administrative expenses in our Consolidated Statements of Operations.

⁽²⁾ Sublease portfolio consists of the sublease of our previous principal executive office located at 777 Third Avenue, New York, NY.

24

AVON PRODUCTS, INC.

The maturity analysis of the finance and operating lease liabilities is reflected below. This table also reflects the reconciliation of the undiscounted cash flows to the discounted finance and operating lease liabilities as recognized in the June 30, 2019 Consolidated Balance Sheet:

Maturity of Lease Liabilities	Operating Leases		Finance Leases		Total
2019	$	30.7	$	.7	$	31.4
2020	52.8		1.2		54.0
2021	43.5		.8		44.3
2022	36.5		.5		37.0
2023	24.3		.1		24.4
2024	17.1		—		17.1
Thereafter	27.6		—		27.6
Total lease payments	$	232.5	$	3.3	$	235.8
Less: Interest	43.9		.3		44.2
Present value of lease liabilities	$	188.6	$	3.0	$	191.6

At December 31, 2018 our operating and finance lease obligations by due dates were as follows:

Maturity of Lease Liabilities	Operating Leases		Finance Leases		Total
2019	$	56.4	$	1.1	$	57.5
2020	42.0		.6		42.6
2021	35.3		.4		35.7
2022	31.1		.2		31.3
2023	22.4		.1		22.5
Thereafter	46.9		.1		47.0
Total lease payments(1)	$	234.1	$	2.5	$	236.6

⁽¹⁾ Total lease payments of $236.6 represent undiscounted cash flows and therefore do not reconcile to the total discounted lease liability of $204.3 at January 1, 2019 shown above.

The Company has calculated the weighted-average remaining lease term, presented in years below, and the weighted-average discount rate for our operating and finance lease population. As noted in our lease accounting policy (See Note 1, Accounting Policies), the Company uses the incremental borrowing rate as the lease discount rate.

Lease Term and Discount Rate	June 30, 2019
Weighted-average remaining lease term (years)
Operating leases	5.0
Finance leases	2.8
Weighted-average discount rate
Operating leases	8.5	%
Finance leases	11.4	%

The table below sets out the classification of lease payments in the Consolidated Statement of Cash Flows. The right-of-use assets obtained in exchange for new finance and operating lease liabilities represent the new operating and finance leases entered into during the three and six months ended June 30, 2019.

25

AVON PRODUCTS, INC.

Other Information	Three months ended June 30, 2019			Six months ended June 30, 2019
- Operating Cash Flows From Operating Leases	$	(15.8	)	$	(32.1	)
- Financing Cash Flows From Finance Leases	(.3		)	(.7		)
Cash Paid For Amounts Included In Measurement of Liabilities	$	(16.1	)	$	(32.8	)
Right-of-use Assets Obtained In Exchange For New Finance Liabilities	$	(.1	)	$	(.9	)
Right-of-use Assets Obtained In Exchange For New Operating Liabilities	$	(8.0	)	$	(20.0	)

10. EMPLOYEE BENEFIT PLANS

	Three Months Ended June 30,
	Pension Benefits
Net Periodic Benefit Costs	U.S. Plans						Non-U.S. Plans						Postretirement Benefits
	2019			2018			2019			2018			2019		2018
Service cost(1)	$	.5		$	.9		$	1.0		$	1.2		$	—	$	—
Interest cost	.6			.6			3.8			4.0			.3		.3
Expected return on plan assets	(.8		)	(.8		)	(7.7		)	(8.2		)	—		—
Amortization of prior service credit	—			—			—			—			—		(.1		)
Amortization of net actuarial losses	.7			1.3			1.3			1.8			—		—
Net periodic benefit costs(1)	$	1.0		$	2.0		$	(1.6	)	$	(1.2	)	$	.3	$	.2

	Six Months Ended June 30,
	Pension Benefits
Net Periodic Benefit Costs	U.S. Plans						Non-U.S. Plans						Postretirement Benefits
	2019			2018			2019			2018			2019		2018
Service cost	$	1.0		$	1.8		$	2.0		$	2.4		$	—	$	.1
Interest cost	1.2			1.2			7.7			8.2			.6		.6
Expected return on plan assets	(1.6		)	(1.6		)	(15.6		)	(16.6		)	—		—
Amortization of prior service credit	—			—			—			—			—		(.2		)
Amortization of net actuarial losses	1.4			2.6			2.6			3.6			—		—
Settlements/curtailments	—			—			0.1			—			—		—
Net periodic benefit costs(1)	$	2.0		$	4.0		$	(3.2	)	$	(2.4	)	$	.6	$	.5

⁽¹⁾ Service cost is presented in selling, general and administrative expenses in our Consolidated Statements of Operations. The components of net periodic benefit costs other than service cost are presented in other expense, net in our Consolidated Statements of Operations.

During the six months ended June 30, 2019, we made less than $1 of contributions to the U.S. and contributions of $2 to the non-U.S. defined benefit pension and postretirement benefit plans, respectively. During the remainder of 2019, we anticipate contributing approximately $0 to $5 and approximately $0 to $5 to fund our U.S. and non-U.S. defined benefit pension and postretirement benefit plans, respectively.

11. CONTINGENCIES

Brazilian Tax Assessments

In December 2012, our Brazilian subsidiary, Avon Industrial LTDA (Avon Brazil Manufacturing) received an excise tax (IPI) assessment for the year 2008. The assessment totals approximately $314, including penalties and accrued interest. As in prior IPI cases that have been resolved in Avon’s favor, this assessment asserts that the establishment in 1995 of separate manufacturing and distribution companies in Brazil was done without a valid business purpose and that Avon Brazil Manufacturing 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

26

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

other companies in Brazil. We believe that our Brazilian corporate structure is appropriate, both operationally and legally, and that the 2012 IPI assessment is unfounded.

These matters are being vigorously contested. In July 2013, the 2012 IPI assessment was upheld at the first administrative level and we appealed this decision to the second administrative level. On April 18, 2018, Avon received official notification that the second administrative level has issued a partially favorable and partially unfavorable decision. In this decision, the original assessment was reduced by approximately $66 (including associated penalty and interest), subject to Federal Revenue appeal. The remaining $248 of the assessment was upheld at the second administrative level. On April 20, 2018, we appealed this decision in the third administrative level where the matter remains pending resolution.

On October 3, 2017, Avon Brazil Manufacturing received a new tax assessment notice regarding IPI for 2014 on grounds similar to the 2012 assessment. The 2017 IPI assessment totals approximately $243, including penalties and accrued interest. On April 2, 2018, Avon was notified of an unfavorable decision at the first administrative level. On February 25, 2019, this IPI assessment was upheld at the second administrative level and on April 11, 2019 we appealed this decision to the third administrative level. 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 2017 IPI assessment is unfounded.

In the event that the 2012 and the 2017 IPI assessments are upheld in the third and final administrative level, it may be necessary for us to provide monetary security to pursue further appeals in the judicial levels, which, depending on the circumstances, may result in a charge to earnings and an adverse effect on the Company's Consolidated Statements of Cash Flows. 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). We believe that the 2012 and the 2017 IPI assessments are unfounded, however, based on the likelihood that these will be upheld, we assess the risks as disclosed above as reasonably possible. At June 30, 2019, we have not recognized a liability for the 2012 or 2017 IPI assessments.

Brazil IPI Tax on Cosmetics

Separate from the tax assessments received by Avon Brazil Manufacturing, Avon Cosmeticos LTDA (Avon Brazil) is involved in litigation related to an executive decree issued in May 2015. This decree increased the amount of IPI taxes that are to be remitted by Avon Brazil to the taxing authority on the sales of cosmetic products. 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 was no longer required to remit the taxes associated with IPI into a judicial deposit. On June 12, 2018, we received a decision authorizing Avon to withdraw the amount held as a judicial deposit, substituting it by letter of guarantee, which was presented. On June 29, 2018, the tax authorities presented an appeal against that decision. On July 30, 2018, the funds were received in our bank account. As of September 30, 2018, due in part to recent judicial decisions across the industry and other developments, we concluded, supported by the opinion of legal counsel, that the Executive Decree is unconstitutional. We therefore assessed the IPI tax under ASC 450, Contingencies and determined that the risk of loss is reasonably possible but not probable. Accordingly, we released the associated liability as of September 30, 2018 of approximately $195 and ceased accruing the IPI taxes from October 1, 2018. The liability had been classified within long-term sales taxes and taxes other than income in our Consolidated Balance Sheet, and the release was recorded in product sales and other (income) expense, net in the amounts of approximately $168 and approximately $27, respectively, in our Consolidated Income Statements for the quarter ended September 30, 2018.

An unfavorable ruling to our objection of this IPI tax increase would have an adverse effect on the Company's Consolidated Income Statements and Consolidated Statements of Cash Flows as Avon Brazil would have to remit the reasonably possible amount of $255 to the taxing authorities (including the judicial deposit that was returned to us on July 30, 2018). We are not able to reliably predict the timing of the outcome of our objection to this tax increase.

A favorable judicial ruling to our objection of this IPI tax would also have an adverse effect on the Company's Consolidated Statements of Cash Flows as Avon Brazil would have to remit all or a portion of the associated income tax liability to the taxing authorities. The Company is accruing a tax reserve, which amounts to approximately $80 at June 30, 2019. This reserve would be settled on final adjudication of the law through a combination of cash and use of deferred tax assets.

27

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

Talc-Related Litigation

The Company has been named a defendant in numerous personal injury lawsuits filed in U.S. courts, alleging that certain talc products the Company sold in the past were contaminated with asbestos. Many of these actions involve a number of co-defendants from a variety of different industries, including manufacturers of cosmetics and manufacturers of other products that, unlike the Company’s products, were designed to contain asbestos. As of June 30, 2019, there were 118 individual cases pending against the Company. During the three months ended June 30, 2019, nine new cases were filed and nine cases were dismissed, settled, or otherwise resolved. The value of our settlements in this area thus far has not been material, either individually or in the aggregate. Additional similar cases arising out of the use of the Company's talc products are reasonably anticipated.

We believe that the claims asserted against us in these cases are without merit. We are defending vigorously against these claims and will continue to do so. To date, the Company has not proceeded to trial in any case filed against it and there have been no findings of liability enforceable against the Company. However, nationwide trial results in similar cases filed against other manufacturers of cosmetic talc products have ranged from outright dismissals to very large jury awards of both compensatory and punitive damages. Given the inherent uncertainties of litigation, we cannot predict any overall trends in the outcome of the cases pending against the Company, and we are only able to make a reasonable estimate for a small number of individual cases that have advanced to the later stages of legal proceedings.  Any accruals currently recorded on the Company’s balance sheet with respect to these individual cases are not material.  Other than these accruals, we are at this time unable to estimate our reasonably possible or probable losses.  However, any adverse outcomes, either in an individual case or in the aggregate, could be material. Future costs to litigate these cases, which we expense as incurred, are not known but may be significant, though some costs will be covered by insurance.

Brazilian Labor-Related Litigation

On an ongoing basis, the Company is subject to numerous and diverse labor-related lawsuits filed by employees in Brazil. These cases are assessed on an aggregated and ongoing basis based on historical outcomes of similar cases. The claims made are often for significantly larger sums than have historically been paid out by the Company. Our practice continues to be to recognize a liability based on our assessment of historical payments in similar cases. Our best estimate of the probable loss for such current cases at June 30, 2019 is approximately $12 and, accordingly, we have recognized a liability for this amount.

Shareholder Litigation

On February 14, 2019, a purported shareholder’s class action complaint (Bevinal v. Avon Products, Inc., et al., No. 19-cv-1420) was filed in the United States District Court for the Southern District of New York against the Company and certain former officers of the Company.  On June 3, 2019, the court appointed a lead plaintiff and class counsel. The complaint was subsequently amended on June 28, 2019 and recaptioned “In re Avon Products, Inc. Securities Litigation” on July 8, 2019. The amended complaint is brought on behalf of a purported class consisting of all purchasers or acquirers of Avon common stock between January 21, 2016 and November 1, 2017, inclusive.  The complaint asserts violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the "Exchange Act") based on allegedly false or misleading statements and alleged market manipulation with respect to, among other things, changes made to Avon’s credit terms for Representatives in Brazil.  On July 26, 2019 we filed a motion to dismiss. In light of the early stage of the litigation, we are unable to predict the outcome of this matter and are unable to assess the likelihood of loss or to make a reasonable estimate of the amount or range of loss that could result from an unfavorable outcome.

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 June 30, 2019, is not expected to have a material adverse effect on our consolidated financial position, results of operations or cash flows.

28

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

12. 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 June 30, 2019 and 2018:

Three Months Ended June 30, 2019	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Investment in New Avon		Total
Balance at March 31, 2019	$	(939.6	)	$	(1.4	)	$	(4.3	)	$	(92.5	)	$	3.4	$	(1,034.4	)
Other comprehensive loss other than reclassifications	4.4			(1.0		)	—			—			—		3.4
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0	—			.3			—			—			—		.3
Amortization of net actuarial loss and prior service cost, net of tax of $.2(1)	—			—			—			1.8			—		1.8
Total reclassifications into earnings	—			.3			—			1.8			—		2.1
Balance at June 30, 2019	$	(935.2	)	$	(2.1	)	$	(4.3	)	$	(90.7	)	$	3.4	$	(1,028.9	)

Three Months Ended June 30, 2018	Foreign Currency Translation Adjustments			Net Investment Hedges			Pension and Postretirement Benefits			Investment in New Avon		Total
Balance at March 31, 2018	$	(797.3	)	$	(4.3	)	$	(92.8	)	$	3.4	$	(891.0	)
Other comprehensive income other than reclassifications	(126.2		)	—			—			—		(126.2		)
Reclassifications into earnings:
Amortization of net actuarial loss and prior service cost, net of tax of $.1(1)	—			—			2.8			—		2.8
Total reclassifications into earnings	—			—			2.8			—		2.8
Balance at June 30, 2018	$	(923.5	)	$	(4.3	)	$	(90.0	)	$	3.4	$	(1,014.4	)

Six Months Ended June 30, 2019	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Investment in New Avon		Total
Balance at December 31, 2018	$	(936.2	)	$	.5		$	(4.3	)	$	(93.8	)	$	3.4	$	(1,030.4	)
Other comprehensive loss other than reclassifications	1.0			(3.4		)	—			—			—		(2.4		)
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0	—			.8			—			—			—		.8
Amortization of net actuarial loss and prior service cost, net of tax of $.3(1)	—			—			—			3.1			—		3.1
Total reclassifications into earnings	—			.8			—			3.1			—		3.9
Balance at June 30, 2019	$	(935.2	)	$	(2.1	)	$	(4.3	)	$	(90.7	)	$	3.4	$	(1,028.9	)

29

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

Six Months Ended June 30, 2018:	Foreign Currency Translation Adjustments			Net Investment Hedges			Pension and Postretirement Benefits			Investment in New Avon		Total
Balance at December 31, 2017	$	(829.6	)	$	(4.3	)	$	(95.7	)	$	3.4	$	(926.2	)
Other comprehensive income other than reclassifications	(93.9		)	—			—			—		(93.9		)
Reclassifications into earnings:
Amortization of net actuarial loss and prior service cost, net of tax of $0.3(1)	—			—			5.7			—		5.7
Total reclassifications into earnings	—			—			5.7			—		5.7
Balance at June 30, 2018	$	(923.5	)	$	(4.3	)	$	(90.0	)	$	3.4	$	(1,014.4	)

(1) Gross amount reclassified to other expense, net in our Consolidated Statements of Operations, and related taxes reclassified to income taxes in our Consolidated Statements of Operations.

Foreign exchange net losses of $2.3 and $9.6 for the three months ended June 30, 2019 and 2018, respectively, and foreign exchange net losses of $.7 and $3.7 for the six months ended June 30, 2019 and 2018, respectively, resulting from the translation of actuarial losses and prior service cost recorded in AOCI, are included in foreign currency translation adjustments in our Consolidated Statements of Comprehensive Loss.

13. SEGMENT INFORMATION

We determine segment profit by deducting the related costs and expenses from segment revenue. Segment profit includes an allocation of global marketing and digital expenses based on actual revenues. Segment profit excludes global expenses other than the allocation of marketing and digital, costs to implement ("CTI") restructuring initiatives (see Note 15, Restructuring Initiatives), certain significant asset impairment charges, and other expenses, 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 June 30,				Six Months Ended June 30,
Total Revenue	2019		2018		2019		2018
Europe, Middle East & Africa	$	425.1	$	500.7	$	883.8	$	1,069.1
South Latin America	443.0		516.1		857.7		1,013.2
North Latin America	193.8		207.3		386.5		402.9
Asia Pacific	108.4		113.1		223.7		224.5
Total revenue from reportable segments	1,170.3		1,337.2		2,351.7		2,709.7
Other operating segments and business activities(1)	4.5		14.7		10.0		35.7
Total revenue	$	1,174.8	$	1,351.9	$	2,361.7	$	2,745.4

30

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

	Three Months Ended June 30,						Six Months Ended June 30,
Operating Profit	2019			2018			2019			2018
Segment Profit
Europe, Middle East & Africa	$	59.0		$	74.4		$	118.2		$	148.8
South Latin America	65.2			55.2			89.0			82.4
North Latin America	19.1			19.0			35.6			39.8
Asia Pacific	10.8			7.3			27.5			17.7
Total profit from reportable segments	$	154.1		$	155.9		$	270.3		$	288.7
Other operating segments and business activities(1)	.5			(.6		)	1.1			1.6
Unallocated global expenses	(65.3		)	(78.6		)	(128.4		)	(157.8		)
CTI restructuring initiatives	(45.7		)	(23.7		)	(99.2		)	(34.6		)
Other expenses(2)	(13.1		)	—			(17.2		)	—
Operating profit	$	30.5		$	53.0		$	26.6		$	97.9

(1) Other operating segments and business activities include markets that have been exited. Effective in the first quarter of 2018, given that we exited Australia and New Zealand during 2018, the results of Australia and New Zealand are now reported in Other operating segments and business activities for all periods presented, while previously the results had been reported in the Asia Pacific segment. 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.

(2) Other expenses includes primarily professional fees incurred in relation to the Natura transaction, and other impairment losses on assets.

14. SUPPLEMENTAL BALANCE SHEET INFORMATION

At June 30, 2019 and December 31, 2018, prepaid expenses and other included the following:

Components of Prepaid Expenses and Other	June 30, 2019		December 31, 2018
Prepaid taxes and tax refunds receivable	$	155.0	$	145.0
Receivables other than trade	53.2		69.2
Prepaid brochure costs, paper and other literature	13.6		14.9
Other	42.4		42.9
Prepaid expenses and other	$	264.2	$	272.0

At June 30, 2019 and December 31, 2018, other assets included the following:

Components of Other Assets(1)	June 30, 2019		December 31, 2018
Net overfunded pension plans	$	95.5	$	88.1
Capitalized software	85.0		89.3
Judicial deposits	74.8		74.1
Long-term receivables	90.6		73.2
Trust assets associated with supplemental benefit plans	37.9		37.0
Tooling (plates and molds associated with our beauty products)	12.5		12.6
Other	38.0		16.1
Other assets	$	434.3	$	390.4

(1) Deferred tax asset balance as of June 30, 2019 and December 31, 2018 is presented separately in the Consolidated Balance sheet.

31

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

15. RESTRUCTURING INITIATIVES

Transformation Plan and Open Up Avon

Open Up Avon

In September 2018, we initiated a new strategy in order to return Avon to growth ("Open Up Avon"). The Open Up Avon strategy is integral to our ability to return Avon to growth, built around the necessity of incorporating new approaches to various elements of our business, including increased utilization of third-party providers in manufacturing and technology, a more fit for purpose asset base, and a focus on enabling our Representatives to more easily interact with the company and achieve relevant earnings. The commercial elements of the strategy were developed to help increase Representative earnings and thereby retention. Elements of the Representative strategy include improvements in service functions, increased training on utilization of digital tools to expand her consumer reach, product bundling and regimens designed to help improve her earnings opportunity and sharper more targeted product innovation to drive brand relevancy. Cost savings under this plan are targeted as annualized cost savings of approximately $400 by 2021, and expected to be generated from efficiencies in manufacturing and sourcing, distribution, general and administrative activities, and back office functions, as well as through revenue management, interest and tax. These savings are expected to be achieved through restructuring actions (that may result in charges related to severance, contract terminations and inventory and other asset write-offs), as well as other cost-savings strategies that would not result in restructuring charges. In January 2019, we announced significant advancements in this strategy, including a structural reset of inventory processes and a reduction in global workforce. The structural reset of inventory will result in lower operational and ongoing obsolescence costs. Over the longer term, it will result in a more concentrated focus on high-turn, higher margin products, driving greater earnings for Representatives due to lessened discount pressure and enhanced service levels. The structural reset resulted in an incremental one-off inventory obsolescence expense of $88 recognized at December 31, 2018. In addition, the global workforce will be reduced in 2019 by approximately 10% to align with ongoing operating model changes and to create a leaner organization that is better aligned with Avon’s current and future business focus. This reduction is incremental to an 8% reduction of the global workforce that was completed in 2018. We expect to incur a restructuring charge of approximately $100 in 2019 relating to the global workforce reduction, which was approved by the Board of Directors in January 2019. We initiated the Open Up Avon strategy to enable us to achieve our goals of low-single-digit Constant $ revenue growth and low double-digit operating margin by 2021. We plan to reinvest a portion of these cost savings in commercial initiatives, including training for Representatives, and digital and information technology infrastructure initiatives. As a result of Open Up Avon restructuring actions approved to-date, we have recorded total costs to implement these restructuring initiatives of $216.6 before taxes, of which $28.3 and $73.4 was recorded during the three and six months ended June 30, 2019, respectively, in our Consolidated Statements of Operations.

Transformation Plan

In January 2016, we initiated a transformation plan (the "Transformation Plan"), in order to enable us to achieve our long-term goals of mid-single-digit constant-dollar ("Constant $") revenue growth and low double-digit operating margin. Under this plan, we had targeted pre-tax annualized cost savings of approximately $350 after three years, which we exceeded through restructuring actions, as well as other cost-savings strategies that did not result in restructuring charges.

As a result of these restructuring actions approved to-date, we have recorded total costs to implement these restructuring initiatives of $207.7 before taxes, of which $4.2 and $2.2 was recorded during the three and six months ended June 30, 2019, respectively, in our Consolidated Statements of Operations. There are no further restructuring actions to be taken associated with our Transformation Plan, as beginning in the third quarter of 2018, all new restructuring actions approved operate under our new Open Up Avon plan described above.

Costs to Implement Restructuring Initiatives - Three and Six Months Ended June 30, 2019 and 2018

During the three months ended June 30, 2019, we recorded net costs to implement of $32.5, of which $28.3 related to Open Up Avon and $4.2 related to the Transformation Plan in our Consolidated Statements of Operations. During the three months ended June 30, 2018, we recorded costs to implement of $24.5 related to the Transformation Plan and $.8 benefit related to other restructuring initiatives in our Consolidated Statements of Operations.

During the six months ended June 30, 2019, we recorded net costs to implement of $75.7, of which $73.4 related to Open Up Avon, $2.2 related to the Transformation Plan, and $.1 related to other restructuring initiatives, in our Consolidated Statements of Operations. During the six months ended June 30, 2018, we recorded costs to implement of $35.3 related to the Transformation Plan and $.7 benefit related to other restructuring initiatives in our Consolidated Statements of Operations.

The costs during the three and six months ended June 30, 2019 and 2018 consisted of the following:

32

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
CTI recorded in operating profit - COGS
Manufacturing asset write-offs	$	6.0		$	—		$	9.8		$	—
Inventory write-off	2.6			.4			3.1			1.1
	8.6			.4			12.9			1.1
CTI recorded in operating profit - SG&A
Net charges for employee-related costs, including severance benefits	13.4			16.5			48.6			24.8
Implementation costs, primarily related to professional service fees	17.3			4.7			26.0			5.7
Dual running costs	2.6			—			4.5			—
Contract termination and other net benefits	1.4			1.2			4.6			1.4
Impairment of other assets	2.3			—			2.3			—
Accelerated depreciation	.1			.9			.3			1.6
	37.1			23.3			86.3			33.5
CTI recorded in operating profit	45.7			23.7			99.2			34.6
CTI recorded in other expenses
Gain on sale of Rye Office	(9.9		)	—			(9.9		)	—
Gain on sale of Malaysia Maximin	(3.3		)	—			(3.3		)	—
Gain on sale of China business (relating mainly to foreign currency translation adjustment gain)	—			—			(10.3		)	—
Total CTI	$	32.5		$	23.7		$	75.7		$	34.6
Open Up Avon	$	28.3		$	—		$	73.4		$	—
Transformation Plan	$	4.2		$	24.5		$	2.2		$	35.3
Other	$	—		$	(.8	)	$	.1		$	(.7	)

The tables below include restructuring costs such as employee-related costs, inventory and asset write-offs, foreign currency translation write-offs and contract terminations, and do not include other costs to implement restructuring initiatives such as professional services fees, dual running costs, accelerated depreciation and gain on sale of business.

The liability balance included in other accrued liabilities in our Consolidated Statements of Operations for the restructuring actions associated with Open Up Avon at June 30, 2019 is as follows:

	Employee-Related Costs			Inventory/Assets Write-offs			Foreign Currency Translation Adjustment Write-offs			Contract Terminations/Other			Total
Balance at December 31, 2018	$	19.6		$	—		$	—		$	1.1		$	20.7
2019 charges	$	52.9		$	15.2		$	(10.9	)	$	4.5		61.7
Adjustments	(3.1		)	—			—			(.1		)	(3.2		)
Cash payments	(35.4		)	—			—			(1.8		)	(37.2		)
Non-cash write-offs	—			(15.2		)	10.9			—			(4.3		)
Foreign exchange	(.8		)	—			—			—			(.8		)
Balance at June 30, 2019	$	33.2		$	—		$	—		$	3.7		$	36.9

33

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

The liability balance included in other accrued liabilities in our Consolidated Balance Sheet for the restructuring actions associated with our Transformation Plan as of June 30, 2019 is as follows:

	Employee-Related Costs			Contract Terminations/Other			Total
Balance at December 31, 2018	$	34.4		$	3.6		$	38.0
2019 charges	(1.1		)	.2			(.9		)
Cash payments	(19.9		)	(2.7		)	(22.6		)
Foreign exchange	.1			—			.1
Balance at June 30, 2019	$	13.5		$	1.1		$	14.6

The majority of cash payments, if applicable, associated with the year-end liability are expected to be made during 2019.

The following table presents the restructuring charges incurred to date, under Open Up Avon and the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plans:

	Employee- Related Costs		Inventory/ Asset Write-offs		Contract Terminations/Other		Foreign Currency Translation Adjustment Write-offs			Total
Open Up Avon
Charges incurred to-date	$	76.1	$	105.1	$	5.2	$	(10.9	)	$	175.5
Estimated charges to be incurred on approved initiatives	—		—		.1		—			.1
Total expected charges on approved initiatives	$	76.1	$	105.1	$	5.3	$	(10.9	)	$	175.6
Transformation Plan
Charges incurred to-date	$	126.9	$	2.3	$	40.9	$	3.4		$	173.5
Estimated charges to be incurred on approved initiatives	—		—		—		—			—
Total expected charges on approved initiatives	$	126.9	$	2.3	$	40.9	$	3.4		$	173.5

34

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

The charges, net of adjustments, of initiatives under the Open Up Avon and the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plans, by reportable segment are as follows:

	Europe, Middle East & Africa			South Latin America		North Latin America			Asia Pacific			Global & Other Operating Segments		Total
Open Up Avon
2018	$	32.2		$	36.4	$	27.9		$	14.4		$	6.2	$	117.1
First quarter 2019	13.5			12.7		2.9			(3.2		)	7.3		33.2
Second quarter 2019	4.5			13.7		4.3			(1.2		)	3.9		25.2
Charges incurred to-date	50.2			62.8		35.1			10.0			17.4		175.5
Estimated charges to be incurred on approved initiatives	.1			—		—			—			—		.1
Total expected charges on approved initiatives	$	50.3		$	62.8	$	35.1		$	10.0		$	17.4	$	175.6
Transformation Plan
2015	$	—		$	—	$	—		$	—		$	21.4	$	21.4
2016	30.9			13.2		4.4			9.1			16.8		74.4
2017	.9			5.6		(.6		)	(.5		)	49.4		54.8
2018	5.0			4.1		.6			.6			13.4		23.7
First quarter 2019	(1.1		)	—		—			—			.3		(.8		)
Second quarter 2019	—			—		—			—			—		—
Charges incurred to-date	35.7			22.9		4.4			9.2			101.3		173.5
Estimated charges to be incurred on approved initiatives	—			—		—			—			—		—
Total expected charges on approved initiatives	$	35.7		$	22.9	$	4.4		$	9.2		$	101.3	$	173.5

The charges above are not included in segment profit, as this excludes costs to implement restructuring initiatives. The amounts shown in the tables above as charges recorded to-date relate to initiatives that have been approved and recorded in the consolidated 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.

16. GOODWILL

	Europe, Middle East & Africa			South Latin America		Asia Pacific		Total
Net balance at December 31, 2018	$	18.0		$	66.8	$	2.6	$	87.4
Changes during the period ended June 30, 2019:
Foreign exchange	(.3		)	2.8		—		2.5
Net balance at June 30, 2019	$	17.7		$	69.6	$	2.6	$	89.9

17. FAIR VALUE

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 June 30, 2019:

35

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

	Level 1		Level 2		Total
Assets:
Available-for-sale securities	$	3.8	$	—	$	3.8
Foreign exchange forward contracts	$	—	$	1.2	$	1.2
Total	$	3.8	$	1.2	$	5.0
Liabilities:
Foreign exchange forward contracts	$	—	$	10.9	$	10.9
Total	$	—	$	10.9	$	10.9

The assets and liabilities measured at fair value on a recurring basis were immaterial at December 31, 2018.

Fair Value of Financial Instruments

Our financial instruments include cash and cash equivalents, available-for-sale securities, short-term investments, accounts 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 June 30, 2019 and December 31, 2018, respectively, consisted of the following:

	June 30, 2019						December 31, 2018
	Carrying Amount			Fair Value			Carrying Amount			Fair Value
Available-for-sale securities	$	3.8		$	3.8		$	3.8		$	3.8
Debt maturing within one year(1)	(398.5		)	(408.1		)	(12.0		)	(12.0		)
Long-term debt(1)	(1,197.0		)	(1,254.0		)	(1,581.6		)	(1,460.2		)
Foreign exchange forward contracts	(9.7		)	(9.7		)	(5.1		)	(5.1		)

(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.

18. 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 at June 30, 2019:

	Asset			Liability
	Balance Sheet Classification	Fair Value		Balance Sheet Classification	Fair Value
Derivatives designated as hedges:
Foreign exchange forward contracts	Prepaid expenses and other	$	—	Accounts payable	$	2.0
Derivatives not designated as hedges:
Foreign exchange forward contracts	Prepaid expenses and other	$	1.2	Accounts payable	$	8.9
Total derivatives		$	1.2		$	10.9

The fair value of derivative instruments outstanding was immaterial at December 31, 2018.

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 June 30, 2019, we do not have any interest-rate swap agreements. Approximately 25% and 1% of our debt portfolio, at June 30, 2019 and December 31, 2018, respectively, was exposed to floating interest rates. For the purpose of this calculation, we consider all short-term debt to be exposed to floating interest rates.

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 was amortized as a reduction of interest expense until repayment of the underlying debt obligations in June 2018, at which point the remaining unamortized balance was fully released to the Consolidated Statement of Operations. The net impact of the gain amortization was zero for both the three and six months ended June 30, 2019, and $1.3 and $6.0 for the three and six months ended June 30, 2018, respectively. At June 30, 2019, there was no unamortized deferred gain associated with the March 2012 interest-rate swap termination as the underlying debt obligations have been paid.

Foreign Currency Risk

We may use foreign exchange forward contracts to manage a portion of our foreign currency exchange rate exposures. At June 30, 2019, we had outstanding foreign exchange forward contracts with notional amounts totaling approximately $1,192.5 for various currencies, of which $19.5 were designated as cash flow hedges.

We may use foreign exchange forward contracts to manage foreign currency exposure of certain intercompany loans. 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 and six months ended June 30, 2019, we recorded a loss of $3.1 and a gain of $21.9, respectively, in other expense in our Consolidated Statements of Operations related to these undesignated foreign exchange forward contracts. During the three and six months ended June 30, 2018, we recorded gains of $1.7 and $2.2, respectively, in other expense, net in our Consolidated Statements of Operations related to other undesignated foreign exchange forward contracts.

During the first quarter of 2019, we discontinued our program to hedge foreign exchange risk relating to forecasted operational transactions. The last of our designated cash flow hedges will expire during the first quarter of 2020. Our designated hedges did not have a material impact on our Consolidated Financial Statements for the six months ended June 30, 2019.

19. DEBT

Revolving Credit Facility

In June 2015, 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").

In February 2019, Avon International Capital, p.l.c. ("AIC"), a wholly-owned foreign subsidiary of the Company, entered into a

three-year €200.0 million senior secured revolving credit facility (the "2019 facility"). As of June 30, 2019 this amounted to $227.0. The 2019 facility replaced the 2015 facility and the 2015 facility was terminated at such time. There were no amounts drawn under

36

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

the 2015 revolving credit facility on the date of termination and no early termination penalties were incurred. In the first quarter of 2019, $2.0 was recorded for the write-off of unamortized issuance costs related to the 2015 revolving credit facility. As of June 30, 2019, there were no amounts outstanding under the 2019 facility. The 2019 facility will terminate in February 2022; provided, however, that it shall terminate on the 91^st day prior to the maturity of 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. In the first quarter of 2019, the Company capitalized $10.0 of issue costs relating to the new revolving credit facility; this resulted in a cash outflow presented in other financing activities within the Consolidated Statement of Cash Flows.

As of June 30, 2019, we were in compliance with our interest coverage and total leverage ratios under the 2019 facility. The amount of the facility available to be drawn down on is reduced by any standby letters of credit granted by an obligor, which, as of June 30, 2019, was approximately $25.0. As of June 30, 2019, based on then applicable exchange rates, the entire amount of the remaining 2019 facility, which is approximately €178.0 million, could have been drawn down without violating any covenant.

Public Notes

In March 2013, we issued, in a public offering, $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"). Interest on the 2013 Notes is payable semi-annually on March 15 and September 15 of each year.

The indenture governing the 2013 Notes contains interest rate adjustment provisions depending on the long-term credit ratings assigned to the 2013 Notes by 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 2.00% 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.

As of June 30, the remaining aggregate principal amount of the 4.60% Notes was $386.9.  In July 2019, the Company issued $400.0 Senior Secured Notes (the 2019 Notes), the proceeds of which were partially used to purchase an aggregate principal amount of $275.0 of the 4.60% Notes. Refer to Note 22, Subsequent Events for further information regarding this issuance. In the second quarter of 2019, the Company capitalized $8 of issue costs relating to the 2019 Notes, with no cash impact in the six month period ended June 30, 2019.

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 "2016 Notes"). Interest on the Senior Secured Notes is payable semi-annually on February 15 and August 15 of each year.

20. INCOME TAXES

Our quarterly income tax provision is calculated using an estimated annual effective income tax approach. The quarterly effective tax rate can differ from our estimated annual effective tax rate as the Company cannot apply an effective tax rate approach for all of its operations. For those entities that can apply an effective tax rate approach, as of June 30, 2019, our annual effective tax rate, excluding discrete items, is 26.0% for 2019, as compared to 25.6% as of June 30, 2018. The remaining entities, which are operations that generate pre-tax losses which cannot be tax benefited and/or have an effective tax rate which cannot be reliably estimated, have to account for their income taxes on a discrete year-to-date basis as of the end of each quarter and are excluded from the effective tax rate approach.

The estimated annual effective tax rate for 2019 also excludes the unfavorable impact of withholding taxes associated with certain intercompany payments, including royalties, service charges, interest and dividends, which in the aggregate are relatively consistent each year due to the need to repatriate funds to cover U.S. and U.K.-based costs, such as interest on debt and corporate overhead. Withholding taxes associated with the relatively consistent intercompany payments are accounted for discretely and accrued in the provision for income taxes as they become due.

The provision for income taxes for the three months ended June 30, 2019 and 2018 was $27.2 and $36.7, respectively. Our effective tax rates for the three months ended June 30, 2019 and 2018 were 127.7% and (12,233.3)%, respectively. The provision for income taxes for the six months ended June 30, 2019 and 2018 was $46.7 and $68.2, respectively. Our effective tax rates for the six months ended June 30, 2019 and 2018 were 278.0% and 675.2%.

37

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

The effective tax rates for the three months ended June 30, 2019 and 2018 were impacted by CTI restructuring charges which could not all be benefitted, country mix of earnings and withholding taxes. The effective tax rate for the three months ended June 30, 2019 was also negatively impacted by the accrual of miscellaneous income tax expenses of approximately $0.6. The effective tax rate for the three months ended June 30, 2018 was also negatively impacted by one-time tax reserves of $5.5 associated with our uncertain tax positions.

The effective tax rates for the six months ended June 30, 2019 and 2018 were impacted by CTI restructuring charges which could not all be benefitted, country mix of earnings and withholding taxes. The effective tax rate for the six months ended June 30, 2019 was also favorably impacted by the accrual of net income tax benefits of approximately $2.9 associated with the release of income tax reserves of approximately $3.3 associated with our uncertain tax positions net of other miscellaneous income tax expenses of approximately $0.4. The effective tax rate for the six months ended June 30, 2018 was also negatively impacted by one-time tax reserves of $14.7 associated with our uncertain tax positions.

In its final analysis of the impacts of the Tax Cuts and Job Act (the "Act") during the fourth quarter of 2018, the Company elected to treat income taxes associated with Global Intangible Low-Taxed Income ("GILTI"), as a period cost. As a result, the 2019 provision for income taxes reflects this treatment. The 2018 provision for income taxes was also calculated treating GILTI as a period cost. For both periods, GILTI did not have a material effect. The Act has significant complexity. The Company has considered the published guidance provided by the various Federal and state regulatory authorities into the calculation of its income tax provisions available as of June 30, 2019 and June 30, 2018 for the respective periods ended June 30, 2019 and June 30, 2018.

In prior years, we had previously recorded valuation allowances against certain deferred tax assets associated with the U.S. and various foreign jurisdictions. We intend to continue maintaining these valuation allowances on our deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances. Release of the valuation allowance would result in the recognition of certain deferred tax assets and a decrease to income tax expense for the period the release is recorded. However, the exact timing and amount of the valuation allowance release are subject to change on the basis of the level of profitability that we are able to actually achieve.

38

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

21. AGREEMENT AND PLAN OF MERGERS WITH NATURA COSMETICOS S.A.

On May 22, 2019, the Company entered into an Agreement and Plan of Mergers (the "Merger Agreement") with Natura Cosméticos S.A., a Brazilian corporation (sociedade anônima) ("Natura Cosméticos"), Natura &Co Holding S.A., a Brazilian corporation (sociedade anônima) ("Natura &Co Holding"), Nectarine Merger Sub I, Inc., a Delaware corporation and a direct wholly owned subsidiary of Natura &Co Holding ("Merger Sub I"), and Nectarine Merger Sub II, Inc., a Delaware corporation and a direct wholly owned subsidiary of Merger Sub I ("Merger Sub II"), pursuant to which (i) Natura &Co Holding will, after the completion of certain restructuring steps, hold all issued and outstanding shares of Natura Cosméticos, (ii) Merger Sub II will merge with and into Avon, with Avon surviving the merger and (iii) Merger Sub I will merge with and into Natura &Co Holding, with Natura &Co Holding surviving the merger and as a result of which Avon will become a wholly owned direct subsidiary of Natura &Co Holding (collectively, the "Transaction"). If the Transaction is completed, Avon and Natura Cosméticos will each become wholly owned subsidiaries of Natura &Co Holding.

If the Transaction is completed, each share of Avon common stock issued and outstanding immediately prior to the consummation of the Transaction will be converted into the right to receive, at the election of the holder thereof, (i) 0.300 validly issued and allotted, fully paid-up American Depositary Shares of Natura &Co Holding, each representing one Natura &Co Holding Share ("Natura &Co Holding ADSs") against the deposit of the requisite number of shares of common stock of Natura &Co Holding ("Natura &Co Holding Shares"), subject to adjustment in accordance with the terms of the Merger Agreement, and any cash in lieu of fractional Natura &Co Holding ADSs or (ii) 0.300 validly issued and allotted, fully paid-up Natura &Co Holding Shares, subject to adjustment in accordance with the terms of the Merger Agreement, and any cash in lieu of fractional Natura &Co Holding Shares, and each share of Avon series C preferred stock held by Cerberus Investor issued and outstanding immediately prior to the consummation of the Transaction will be automatically converted into the right to receive an amount in cash without interest equal to the Stated Value (as defined in Avon's certificate of incorporation) of such shares of series C preferred stock. Upon the consummation of the Transaction, Natura &Co Holding Shares are expected to be listed on the B3 S.A. - Brasil, Bolsa, Balcão stock exchange (the "B3") and Natura &Co Holding ADSs are expected to be listed on the New York Stock Exchange (the "NYSE"). Additionally, upon the consummation of the Transaction, Avon common stock will cease to be traded on the NYSE.

The Merger Agreement contains customary representations and warranties of Avon, Natura Cosméticos and Natura &Co Holding relating to their respective businesses and public filings, in each case generally subject to a materiality qualifier. Additionally, the Merger Agreement provides for customary pre-closing covenants of Avon, including (i) covenants relating to conducting its business in the ordinary course consistent with past practice and to refrain from taking certain actions without Natura Cosméticos's consent, (ii) covenants not to solicit proposals relating to alternative transactions or, subject to certain exceptions, enter into discussions concerning, or provide information in connection with, alternative transactions and (iii) covenants to recommend, subject to certain exceptions, that Avon's shareholders adopt the Merger Agreement.

The timing and completion of the Transaction is subject to a number of closing conditions, including (i) Avon and Natura Cosméticos shareholder approvals having been obtained in accordance with applicable law, (ii) clearance from competition authorities in certain jurisdictions where Avon and Natura Cosméticos operate, (iii) the absence of any judgment, injunction or other order issued by a court of competent jurisdiction prohibiting the Transaction, (iv) effectiveness of registration statements for Natura &Co Holding's ADSs, (v) listing approval for Natura &Co Holding's ADSs on the NYSE, (vi) listing approval for Natura &Co Holding's shares on the B3 stock exchange under the Novo Mercado listing segment and (vii) subject to certain materiality exceptions, the accuracy of Avon's, Natura Cosméticos's and Natura &Co Holding's representations and warranties in the Merger Agreement and performance by each party of their obligations under the Merger Agreement.

The Company has incurred costs to date of $17 in relation to the Transaction, primarily professional fees and impairment loss on assets, and these have been disclosed as a non-GAAP adjustment to operating profit, selling, general and administrative expenses as a % of total revenue, operating margin and income (loss) before taxes. It is expected that additional costs will be incurred prior to or at the closing of the Transaction, including approximately $33 with respect to professional fees that are contingent on the successful closing of the Transaction.

22. SUBSEQUENT EVENTS

Bond issue

In July 2019, the Company issued $400 in aggregate principal amount of 6.50% Senior Notes which will mature on August 15, 2022. The proceeds were partially used to purchase an aggregate principal amount of $275 of the Company's 4.6% Notes, due during 2020, under a cash tender offer completed during July 2019.

Indirect tax Court Decisions in Brazil

39

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in millions, except per share data)

In July 2019, the Brazilian judicial court held decisions in favor of Avon relating to historic indirect tax items. The Company has not received the formal decision in writing as of the date of this filing. At June 30, 2019, no receivable was recognized in relation to these cases. The gross amount of the credits involved is $117.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

When used in this report, the terms "Avon," "Company," "we," "our" or "us" mean, unless the context otherwise indicates, Avon Products, Inc. and its majority, wholly owned and controlled subsidiaries.

OVERVIEW

We are a global manufacturer and marketer of beauty and related products. Our business is conducted primarily in the direct-selling channel. During 2018, we had sales operations in 56 countries and territories, and distributed products in 21 more. All of our consolidated revenue is derived from operations of subsidiaries outside of the United States ("U.S."). Our reportable segments are based on geographic operations in four regions: Europe, Middle East & Africa; South Latin America; North Latin America; and Asia Pacific. Our product categories are Beauty and Fashion & Home. Beauty consists of skincare, fragrance and color (cosmetics). Fashion & Home consists of fashion apparel, accessories, housewares and leisure products. Sales are made to the ultimate consumer principally through direct selling by Representatives, who are independent contractors and not our employees.

During the six months ended June 30, 2019, revenue decreased 14% compared to the prior-year period, unfavorably impacted by foreign exchange. Constant $ revenue decreased 5%.

Revenue and Constant $ revenue decline was primarily driven by Europe Middle East & Africa markets, in particular Russia. Russia continued to be impacted by lower market consumption, as well as weaker sales leader engagement. The latter has been actively addressed in the second quarter of 2019 through a heavy focus on recruitment which resulted in a slow-down of the decline in Revenue and Active Representatives in comparison to the first quarter of 2019.

Revenue and Constant $ revenue were impacted by a decrease in Active Representatives of 10%, partially offset by higher Average Representative Sales. Average Representative Sales decreased 5% on a reported basis, unfavorably impacted by foreign exchange, and increased 5% on a Constant $ basis. While Revenue and Constant $ revenue have declined, we see this as a consequence of our intent to improve productivity by increasing Average Representative Sales, primarily through price/mix expansion. Average Representative Sales were also favorably impacted by certain indirect tax items recognized in Brazil in the second quarter of 2019 as well as a positive impact from the Brazil IPI tax compared to the prior-year period. For additional details on the IPI tax on cosmetics increase in Brazil, see Note 11, Contingencies, to the Consolidated Financial Statements included herein.

Units sold decreased 13%, driven by declines in Brazil and Russia.

See "Segment Review" in this management's discussion and analysis of financial condition and results of operations ("MD&A") for additional information related to changes in revenue by segment.

Agreement and Plan of Mergers with Natura Cosméticos S.A.

On May 22, 2019, we entered into an Agreement and Plan of Mergerswith Natura Cosméticos S.A., a Brazilian corporation (sociedade anônima) ("Natura Cosméticos"), Natura &Co Holding S.A., a Brazilian corporation (sociedade anônima) ("Natura &Co Holding"), and two subsidiaries of Natura &Co Holding pursuant to which, in a series of transactions, Avon and Natura Cosméticos will become direct wholly owned subsidiaries of Natura &Co Holding (the "Transaction"). For additional information, see Note 21, Agreement and Plan of Mergers with Natura Cosméticos S.A., to the Consolidated Financial Statements included herein, and our Current Report on Form 8-K filed with the Securities and Exchange Commission on May 24, 2019.

Open Up Avon

In September 2018, we initiated a new strategy in order to return Avon to growth ("Open Up Avon"). The Open Up Avon strategy is integral to our ability to return Avon to growth, built around the necessity of incorporating new approaches to various elements of our business, including increased utilization of third-party providers in manufacturing and technology, a more fit for purpose asset base, and a focus on enabling our Representatives to more easily interact with the company and achieve relevant earnings. The commercial elements of the strategy were developed to help increase Representative earnings and thereby retention. Elements of the Representative strategy include improvements in service functions, increased training on utilization of digital tools to expand her consumer reach, product bundling and regimens designed to help improve her earnings opportunity and sharper more targeted product innovation to drive brand relevancy. Cost savings under this plan are targeted as annualized cost savings of approximately

40

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

$400 by 2021, and expected to be generated from efficiencies in manufacturing and sourcing, distribution, general and administrative activities, and back office functions, as well as through revenue management, interest and tax. These savings are expected to be achieved through restructuring actions (that may result in charges related to severance, contract terminations and inventory and other asset write-offs), as well as other cost-savings strategies that would not result in restructuring charges. In January 2019, we announced significant advancements in this strategy, including a structural reset of inventory processes and a reduction in global workforce. The structural reset of inventory will result in lower operational and ongoing obsolescence costs. Over the longer term, it will result in a more concentrated focus on high-turn, higher margin products, driving greater earnings for Representatives due to lessened discount pressure and enhanced service levels. The structural reset resulted in an incremental one-off inventory obsolescence expense of $88 recognized at December 31, 2018. In addition, the global workforce will be reduced in 2019 by approximately 10% to align with ongoing operating model changes and to create a leaner organization that is better aligned with Avon’s current and future business focus. This reduction is incremental to an 8% reduction of the global workforce that was completed in 2018. We expect to incur a restructuring charge of approximately $100 in 2019 relating to the global workforce reduction, which was approved by the Board of Directors in January 2019. We initiated the Open Up Avon strategy to enable us to achieve our goals of low-single-digit Constant $ revenue growth and low double-digit operating margin by 2021. We plan to reinvest a portion of these cost savings in commercial initiatives, including training for Representatives, and digital and information technology infrastructure initiatives.

During 2018, we estimate that we achieved total cost savings of $40 attributable to Open Up Avon, primarily related to tax and interest, when compared to our costs in 2017. In addition, during the six months ended June 30, 2019, we estimate that we achieved cost savings of $89. These savings included both run-rate savings from Open Up Avon actions in 2018, along with in-year savings from current year initiatives.

In connection with the actions and associated savings discussed above, we have incurred costs to implement ("CTI") restructuring initiatives of approximately $217 before taxes to-date associated with Open Up Avon, which includes $88 relating to the structural reset of inventory. The costs of approximately $217 before taxes incurred to-date associated with Open Up Avon includes $176 of employee-related costs, inventory and asset write-offs, foreign currency translation write-offs and contract terminations, and $41 related to professional service fees, dual running costs, accelerated depreciation and gain on sale of business. Of these costs, $73 was recorded during the six months ended June 30, 2019. The additional charges not yet incurred associated with the restructuring actions approved as at June 30, 2019 of $5 to $10 before taxes are expected to be recorded primarily in 2019. At June 30, 2019, we have liabilities of approximately $52 associated with our restructuring actions, primarily associated with Open Up Avon. The majority of future cash payments associated with these restructuring liabilities are expected to be made during 2019. For additional details on restructuring initiatives, see Note 15, Restructuring Initiatives, to the Consolidated Financial Statements included herein.

Transformation Plan

In January 2016, we initiated a transformation plan (the "Transformation Plan"), in order to enable us to achieve our long-term goals of mid-single-digit constant-dollar ("Constant $") revenue growth and low double-digit operating margin. There are no further restructuring actions to be taken associated with our Transformation Plan as, beginning in the third quarter of 2018, all new restructuring actions approved operate under our new Open Up Avon plan described above.

NEW ACCOUNTING STANDARDS

Information relating to new accounting standards is included in Note 1, Accounting Policies, to the Consolidated Financial Statements included herein.

RESULTS OF OPERATIONS—THE THREE AND SIX MONTHS ENDED JUNE 30, 2019 AS COMPARED TO THE THREE AND SIX MONTHS ENDED JUNE 30, 2018

Performance Metrics

Within this MD&A, in addition to our key financial metrics of revenue, operating profit and operating margin, we define additional performance metrics in our 2018 Annual Report on Form 10-K. We have renamed the Change in Average Order metric to Change in Average Representative Sales. The definition of the metric is unchanged and is included below.

41

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

Performance Metrics	Definition
Change in Average Representative Sales	This metric is a measure of Representative productivity. The calculation is the difference of the year-over-year change in revenue on a Constant $ basis and the Change in Active Representatives. Change in Average Representative Sales may be impacted by a combination of factors such as inflation, units, product mix, and/or pricing.

In the second quarter of 2019, references to "net sales" have been replaced with "product sales", as it was considered a more accurate description of the nature of the balance. There have been no changes to what constitutes this balance.

Non-GAAP Financial Measures

To supplement our financial results presented in accordance with accounting principles generally accepted in the United States ("GAAP"), we disclose operating results that have been adjusted to exclude the impact of changes due to the translation of foreign currencies into U.S. dollars, including changes in: revenue, operating profit, Adjusted operating profit, operating margin and Adjusted operating margin. We also refer to these adjusted financial measures as Constant $ items, which are Non-GAAP financial measures. We believe these measures provide investors an additional perspective on trends and underlying business results. To exclude the impact of changes due to the translation of foreign currencies into U.S. dollars, we calculate current-year results and prior-year results at constant exchange rates, which are updated on an annual basis as part of our budgeting process. Foreign currency impact is determined as the difference between actual growth rates and Constant $ growth rates.

We also present gross margin, SG&A as a percentage of revenue, operating profit, operating margin, income (loss) before taxes, income taxes and effective tax rate on a Non-GAAP basis. We refer to these Non-GAAP financial measures as "Adjusted." We also present free cash flow as an additional financial measure for liquidity. We have provided a quantitative reconciliation of the difference between the Non-GAAP financial measures and the financial measures calculated and reported in accordance with GAAP. See "Reconciliation of Non-GAAP Financial Measures" within "Results of Operations" in this MD&A for this quantitative reconciliation.

The Company uses the Non-GAAP financial measures to evaluate its operating performance. These Non-GAAP measures should not be considered in isolation, or as a substitute for, or superior to, financial measures calculated in accordance with GAAP. The Company believes investors find the Non-GAAP information helpful in understanding the ongoing performance of operations separate from items that may have a disproportionate positive or negative impact on the Company's financial results in any particular period. The Company believes that it is meaningful for investors to be made aware of the impacts of 1) CTI restructuring initiatives; 2) impairment loss on assets and other expenses 3) one-time tax items that are not associated with recurring, normal operations ("Special tax items").

(1)    CTI restructuring initiatives includes the impact on the Consolidated Statements of Operations for all periods presented of

net charges incurred on approved restructuring initiatives.

(2)    The Company recorded approximately $13 of other expenses, primarily professional fees incurred in relation to the Natura transaction, and other impairment losses on assets.

(3)    The Special tax items includes the impact on the provision for income taxes in the Consolidated Statements of Operations for the six month period ended June 30, 2018 due to one-time tax reserves of approximately $15 associated with our uncertain tax positions.

See Note 15, Restructuring Initiatives and Note 20, Income Taxes, to the Consolidated Financial Statements included herein and "Effective Tax Rate" in this MD&A for more information on these items.

42

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

	Three Months Ended June 30,								Six Months Ended June 30,
	2019			2018			%/Basis Point Change		2019			2018			%/Basis Point Change
Select Consolidated Financial Information
Total revenue	$	1,174.8		$	1,351.9		(13	)%	$	2,361.7		$	2,745.4		(14	)%
Cost of sales	(497.5		)	(539.7		)	(8	)%	(1,014.5		)	(1,119.4		)	(9	)%
Selling, general and administrative expenses	(646.8		)	(759.2		)	(15	)%	(1,320.6		)	(1,528.1		)	(14	)%
Operating profit (loss)	30.5			53.0			(42	)%	26.6			97.9			(73	)%
Interest expense	(30.7		)	(34.5		)	(11	)%	(63.9		)	(70.7		)	(10	)%
Interest income	1.5			3.5			*		3.2			7.7			(58	)%
Other income (expense), net	6.8			(19.4		)	*		29.4			(21.9		)	*
Loss on extinguishment of debt and credit facilities	—			(2.9		)	*		(2.0		)	(2.9		)	(31	)%
Income (loss) from continuing operations, before income taxes	21.3			(.3		)	*		16.8			10.1			66	%
Loss from continuing operations, net of tax	(5.9		)	(37.0		)	(84	)%	(29.9		)	(58.1		)	(49	)%
Net loss attributable to Avon	$	(19.5	)	$	(36.1	)	(46	)%	$	(52.2	)	$	(56.4	)	(7	)%
Diluted loss per share attributable to Avon	$	(.06	)	$	(.09	)	(33	)%	$	(.14	)	$	(.15	)	(7	)%
Advertising expenses(1)	$	(11.6	)	$	(31.9	)	(64	)%	$	(27.7	)	$	(61.1	)	(55	)%
Reconciliation of Non-GAAP Financial Measures
Gross margin	57.7		%	60.1		%	(240	)	57.0		%	59.2		%	(220	)
CTI restructuring	.7			—			1		.6			—			1
Adjusted gross margin	58.4		%	60.1		%	(170	)	57.6		%	59.2		%	(160	)
Selling, general and administrative expenses as a % of total revenue	55.1		%	56.2		%	(110	)	55.9		%	55.7		%	20
CTI restructuring	(3.2		)	(1.8		)	(140	)	(3.6		)	(1.2		)	(240	)
Impairment loss on assets and other expenses	(1.1		)	—			(110	)	(.7		)	—			(70	)
Adjusted selling, general and administrative expenses as a % of total revenue	50.8		%	54.4		%	(360	)	51.5		%	54.4		%	(290	)
Operating (loss) profit	$	30.5		$	53.0		(42	)%	$	26.6		$	97.9		(73	)%
CTI restructuring	45.7			23.7					99.2			34.6
Impairment loss on assets and other expenses	13.1			—					17.2			—
Adjusted operating profit	$	89.3		$	76.7		16	%	$	143.0		$	132.5		8	%
Operating margin	2.6		%	3.9		%	(130	)	1.1		%	3.6		%	(250	)
CTI restructuring	3.9			1.8			210		4.2			1.3			290
Impairment loss on assets and other expenses	1.1			—			110		.7			—			70
Adjusted operating margin	7.6		%	5.7		%	190		6.1		%	4.8		%	130
Change in Constant $ Adjusted operating margin(2)							240								190
Income (loss) before taxes	$	21.3		$	(.3	)	*		$	16.8		$	10.1		66	%
CTI restructuring	32.5			23.7					75.7			34.6
Impairment loss on assets and other expenses	13.1			—					17.2			—
Adjusted income before taxes	$	66.9		$	23.4		*		$	109.7		$	44.7		*

43

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

	Three Months Ended June 30,								Six Months Ended June 30,
	2019			2018			%/Basis Point Change		2019			2018			%/Basis Point Change
Income taxes	$	(27.2	)	$	(36.7	)	(26	)%	$	(46.7	)	$	(68.2	)	(32	)%
CTI restructuring	(6.6		)	—					(10.3		)	(2.1		)
Special tax items	—			5.5					—			14.7
Adjusted income taxes	$	(33.8	)	$	(31.2	)	8	%	$	(57.0	)	$	(55.6	)	3	%
Effective tax rate	127.7		%	(12,233.3		)%			278.0		%	675.2		%
Adjusted effective tax rate	50.5		%	133.3		%			52.0		%	124.4		%
Net cash provided (used) by operating activities of continuing operations	$	7.1		$	(10.4	)	*		$	(135.6	)	$	(106.7	)	27	%
Net cash provided (used) by investing activities of continuing operations	19.2			(22.9		)	*		44.8			(49.9		)	*
Free cash flow provided (used) by continuing operations	$	26.3		$	(33.3	)	*		$	(90.8	)	$	(156.6	)	(42	)%
Performance Metrics
Change in Active Representatives							(10	)%							(10	)%
Change in units sold							(14	)%							(13	)%

* Calculation not meaningful

Amounts in the table above may not necessarily sum due to rounding.

(1) Advertising expenses are recorded in SG&A.

(2) Change in Constant $ Adjusted operating margin for all years presented is calculated using the current-year Constant $ rates.

Three Months Ended June 30, 2019

Revenue

During the three months ended June 30, 2019, revenue decreased 13% compared to the prior-year period, unfavorably impacted by foreign exchange. Constant $ revenue decreased 5%.

While Revenue and Constant $ revenue have declined, we see this as a consequence of our intent to improve productivity by increasing Average Representative Sales, primarily through price/mix expansion.

Revenue and Constant $ revenue were impacted by a decrease in Active Representatives of 10%, across multiple markets, primarily Brazil, Mexico and Russia. Average Representative Sales decreased 3% unfavorably impacted by foreign exchange and Constant $ Average Representative Sales increased 5%. Average Representative Sales was also favorable impact of certain indirect tax items recognized in Brazil, in the second quarter of 2019, as well as a positive impact from the Brazil IPI tax compared to the prior-year period. For additional details on the IPI tax on cosmetics increase in Brazil, see Note 11, Contingencies, to the Consolidated Financial Statements included herein. Units sold decreased 14%, driven by declines in Brazil and Russia.

44

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

On a category basis, our product sales from reportable segments and associated growth rates were as follows:

	Three Months Ended June 30,				% Change
	2019		2018		US$		Constant $
Beauty:
Skincare	$	345.9	$	372.4	(7	)%	—	%
Fragrance	303.1		347.8		(13	)	(3	)
Color	180.8		212.4		(15	)	(7	)
Total Beauty	829.8		932.6		(11	)	(2	)
Fashion & Home:							—
Fashion	156.2		185.9		(16	)	(11	)
Home	122.8		144.3		(15	)	(8	)
Total Fashion & Home	279.0		330.2		(16	)	(10	)
Product sales from reportable segments	$	1,108.8	$	1,262.8	(12	)	(5	)
Product sales from Other operating segments and business activities	—		6.0		(100	)	(100	)
Product sales	$	1,108.8	$	1,268.8	(13	)	(6	)

See "Segment Review" in this MD&A for additional information related to changes in revenue by segment.

Operating Margin

Operating margin decreased 130 basis points and Adjusted operating margin increased 190 basis points, compared to the same period of 2018, driven by improved price/mix and savings across multiple cost lines. This margin improvement was delivered despite the unfavorable impact of foreign currency. The movements in operating margin and Adjusted operating margin are discussed further below in "Gross Margin" and "Selling, General and Administrative Expenses."

Gross Margin

Gross margin decreased 240 basis points, and Adjusted gross margin decreased 170 basis points, compared to the same period of 2018.

Gross margin and Adjusted gross margin declined as price/mix did not fully offset the unfavorable impact of foreign currency and supply chain costs. Price/mix improvements were driven by effective pricing, optimized discounts and promotions, more effective incentives and more favorable product mix in most markets (benefit impact of 230 basis points). The unfavorable impact of foreign currency is largely due to currency devaluations in Brazil, Argentina and Turkey (unfavorable impact of 190 basis points). Higher supply chain costs were driven by higher material costs and the impact of lower production volumes (unfavorable impact of 150 basis points).

Selling, General and Administrative Expenses ("SG&A")

SG&A as a percentage of total revenue decreased 110 basis points, significantly impacted by higher CTI restructuring charges, and Adjusted SG&A as a percentage of total revenue decreased 360 basis points, compared to the same period of 2018.

Savings in SG&A were recorded across all segments, in multiple areas, including lower fixed expenses driven by tight cost management and restructuring initiatives (benefit of 180 basis points), lower advertising expenses, primarily in Brazil, due to certain indirect tax items (benefit of 130 basis points) and continuous reduction of bad debt expense due to improved credit control and collections processes, primarily in Brazil (benefit of 70 basis points).

Other Expenses

Interest expense decreased by approximately $4 and interest income decreased by approximately $2 compared to the prior-year period.

Other income, net, of $7 increased by approximately $26 compared to other expense, net of $19 in the prior-year period. The approximate $26 benefit was primarily attributable to favorable impact of foreign exchange net gains in the second quarter of 2019 compared to losses in the second quarter of 2018 as well as the impact of interest on certain indirect tax items recognized in Brazil.

Gain on sale of business/assets related to the result of the sale of the Rye office and Maximin Corporation Sdn Bhd, in June and May 2019 respectively. Refer to Note 3, Discontinued Operations, Assets and Liabilities Held for Sale and Divestitures, for more information relating to these disposals.

45

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

Effective Tax Rate

The effective tax rates and the Adjusted effective tax rates in 2019 and 2018 continue to be impacted by our inability to recognize additional deferred tax assets in various jurisdictions related to our current-year operating results. In addition, the effective tax rates and the Adjusted effective tax rates in 2019 and 2018 continue to be impacted by withholding taxes associated with certain intercompany payments, including royalties, service charges, interest and dividends, which in the aggregate are relatively consistent each year due to the need to repatriate funds to cover U.S. and U.K.-based costs, such as interest on debt and corporate overhead. These factors resulted in unusually high effective tax rates and Adjusted effective tax rates in 2019 and 2018.

Our effective tax rates for the three months ended June 30, 2019 and 2018 were 127.7% and (12,233.3)%, respectively. The effective tax rates in 2019 and 2018 were impacted by CTI restructuring charges, country mix of earnings and withholding taxes. The effective tax rate for the three months ended June 30, 2019 was also negatively impacted by the accrual of miscellaneous income tax expenses of approximately $.6. The effective tax rate for the three months ended June 30, 2018 was also negatively impacted by one-time tax reserves of $5.5 associated with our uncertain tax positions.

Our Adjusted effective tax rates for the three months ended June 30, 2019 and 2018 were 50.5% and 133.3%, respectively. The Adjusted effective tax rates in 2019 and 2018 were impacted by country mix of earnings and withholding taxes. The Adjusted effective tax rate in the second quarter of 2019 was also negatively impacted by the accrual of miscellaneous income tax expenses of approximately $.6. The Adjusted effective tax rate in the second quarter of 2018 was also negatively impacted by one-time tax reserves of $5.5 associated with our uncertain tax positions.

See Note 20, Income Taxes, to the Consolidated Financial Statements included herein for more information on the effective tax rate, and Note 15, Restructuring Initiatives, to the Consolidated Financial Statements included herein for more information on CTI restructuring.

Impact of Foreign Currency

As compared to the prior-year period, foreign currency has impacted our consolidated financial results in the form of:

• foreign currency transaction losses (classified within cost of sales and SG&A in our Consolidated Statements of Operations), which had an unfavorable impact to operating profit and Adjusted operating profit of approximately $20, or approximately 140 basis points to operating margin and Adjusted operating margin;

• foreign currency translation, which had an unfavorable impact of approximately $10 to operating profit and Adjusted operating profit, or a unfavorable impact of approximately 70 basis points and an unfavorable impact of approximately 20 basis points, respectively, to operating margin and Adjusted operating margin; and

• foreign exchange net gains, on our working capital (classified within other expense, net in our Consolidated Statements of Operations) as compared to losses in the prior year, resulting in a favorable impact of approximately $20 before tax on both a reported and Adjusted basis.

Six Months Ended June 30, 2019

Revenue

During the six months ended June 30, 2019, revenue decreased 14% compared to the prior-year period, unfavorably impacted by foreign exchange. Constant $ revenue decreased 5%.

Revenue and Constant $ revenue decline was primarily driven by Europe Middle East & Africa markets, in particular Russia. Russia continued to be impacted by lower market consumption, as well as weaker sales leader engagement. The latter has been actively addressed in the second quarter of 2019 through a heavy focus on recruitment which resulted in a slow-down of the decline in Revenue and Active Representatives in comparison to the first quarter of 2019.

Revenue and Constant $ revenue were impacted by a decrease in Active Representatives of 10%, partially offset by higher Average Representative Sales. Average Representative Sales decreased 5% on a reported basis, unfavorably impacted by foreign currency, and increased 5% on a Constant $ basis. While Revenue and Constant $ revenue have declined, we see this as a consequence of our intent to improve productivity by increasing Average Representative Sales, primarily through price/mix expansion. Average Representative Sales was also favorably impacted by certain indirect tax items recognized in Brazil, in the second quarter of 2019, as well as a positive impact from the Brazil IPI tax compared to the prior-year period. For additional details on the IPI tax on cosmetics increase in Brazil, see Note 11, Contingencies, to the Consolidated Financial Statements included herein.

Units sold decreased 13%, driven by declines in Brazil and Russia.

On a category basis, our product sales from reportable segments and associated growth rates were as follows:

	Six Months Ended June 30,				% Change
	2019		2018		US$		Constant $
Beauty:
Skincare	$	695.2	$	761.5	(9	)%	1	%
Fragrance	601.1		701.8		(14	)	(3	)
Color	370.0		448.1		(17	)	(8	)
Total Beauty	1,666.3		1,911.4		(13	)	(3	)
Fashion & Home:							—
Fashion	320.5		374.5		(14	)	(8	)
Home	238.2		273.7		(13	)	(4	)
Total Fashion & Home	558.7		648.2		(14	)	(6	)
Product sales from reportable segments	$	2,225.0	$	2,559.6	(13	)	(4	)
Product sales from Other operating segments and business activities	—		18.8		(100	)	(100	)
Product sales	$	2,225.0	$	2,578.4	(14	)	(5	)

See "Segment Review" in this MD&A for additional information related to changes in revenue by segment.

Operating Margin

Operating margin decreased 250 basis points and Adjusted operating margin increased 130 basis points, compared to the same period of 2018, driven by improved price/mix and savings across multiple cost lines. This margin improvement was delivered despite the unfavorable impact of foreign currency. The movements in operating margin and Adjusted operating margin are discussed further below in "Gross Margin" and "Selling, General and Administrative Expenses."

Gross Margin

Gross margin decreased 220 basis points, and Adjusted gross margin decreased 160 basis points, compared to the same period of 2018.

Gross margin and Adjusted gross margin declined as price/mix did not fully offset the unfavorable impact of foreign currency and supply chain costs. Price/mix improvements were driven by effective pricing, optimized discounts and promotions, more effective incentives and more favorable product mix in most markets (benefit impact of 190 basis points). The unfavorable impact of foreign currency is largely due to currency devaluations in Brazil, Argentina and Turkey (unfavorable impact of 230 basis points). Higher supply chain costs were driven by higher material costs (unfavorable impact of 80 basis points).

Selling, General and Administrative Expenses ("SG&A")

SG&A as a percentage of total revenue increased 20 basis points, significantly impacted by higher CTI restructuring charges, and Adjusted SG&A as a percentage of total revenue decreased 290 basis points, compared to the same period of 2018.

Savings in SG&A were recorded across all segments, in multiple areas, mostly from lower fixed expenses (benefit of 160 basis points), lower advertising expenses (benefit of 100 basis points) and better bad debt management (benefit of 60 basis points). Lower fixed expenses were driven by tight cost management and restructuring initiatives including lower headcount. Advertising expenses benefited from certain indirect tax items in Brazil as well as optimizing our portfolio by concentrating investments in selected channels and focusing on digital advertising. We have further reduced our bad debt expense, primarily in Brazil, from continued focus on credit control and collections processes.

Other Expenses

Interest expense decreased by approximately $7 and interest income decreased by approximately $5 compared to the prior-year period.

Loss on extinguishment of debt and credit facilities of approximately $2 is consistent with the prior-year period. The current period charge is comprised of the write-off of debt issuance costs related to the 2015 revolving credit facility, which was terminated and replaced with a new revolving credit facility in February 2019. Refer to Note 19, Debt, for more information relating to the termination of the 2015 revolving credit facility.

46

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

Other income, net, of $29 increased by approximately $51 compared to other expense, net of $22 in the prior-year period. The approximate $51 benefit was primarily attributable to favorable impact of higher foreign exchange net gains in the six month period ended June 30, 2019 compared to losses in the six month period ended June 30, 2018, as well as the impact of interest on certain indirect tax items recognized in Brazil in the second quarter of 2019.

Gain on sale of business/assets was the result of the sale of Avon Manufacturing (Guangzhou), Ltd. which closed in February 2019, the sale of the Rye office, which closed in June 2019 and the sale of Maximin Corporation Sdn Bhd, which closed in May 2019. Refer to Note 3, Discontinued Operations, Assets and Liabilities Held for Sale and Divestitures, for more information relating to the sale of these businesses and assets.

Effective Tax Rate

The effective tax rates and the Adjusted effective tax rates in 2019 and 2018 continue to be impacted by our inability to recognize additional deferred tax assets in various jurisdictions related to our current-year operating results. In addition, the effective tax rates and the Adjusted effective tax rates in 2019 and 2018 continue to be impacted by withholding taxes associated with certain intercompany payments, including royalties, service charges, interest and dividends, which in the aggregate are relatively consistent each year due to the need to repatriate funds to cover U.S. and U.K.-based costs, such as interest on debt and corporate overhead. These factors resulted in unusually high effective tax rates and Adjusted effective tax rates in 2019 and 2018.

Our effective tax rates for the six months ended June 30, 2019 and 2018 were 278% and 675%, respectively. The effective tax rates in 2019 and 2018 were impacted by CTI restructuring charges, country mix of earnings and withholding taxes. The effective tax rate for the three months ended June 30, 2019 was also favorably impacted by the accrual of net income tax benefits of approximately $2.9 associated with the release of income tax reserves of approximately $3.3 associated with our uncertain tax positions net of other miscellaneous income tax expenses of approximately $.4. The effective tax rate for the six months ended June 30, 2018 was also negatively impacted by one-time tax reserves of $14.7 associated with our uncertain tax positions.

Our Adjusted effective tax rates for the six months ended June 30, 2019 and 2018 were 52% and 124%, respectively. The Adjusted effective tax rates in 2019 and 2018 were impacted by country mix of earnings and withholding taxes. The Adjusted effective tax rate in the first quarter of 2019 was also favorably impacted by the accrual of net income tax benefits of approximately $2.9 associated with the release of income tax reserves of approximately $3.3 associated with our uncertain tax positions net of other miscellaneous income tax expenses of approximately $.4. The effective tax rate for the six months ended June 30, 2018 was also negatively impacted by one-time tax reserves of $14.7 associated with our uncertain tax positions.

See Note 20, Income Taxes, to the Consolidated Financial Statements included herein for more information on the effective tax rate, and Note 15, Restructuring Initiatives, to the Consolidated Financial Statements included herein for more information on CTI restructuring.

Impact of Foreign Currency

As compared to the prior-year period, foreign currency has impacted our consolidated financial results in the form of:

• foreign currency transaction losses (classified within cost of sales, and SG&A in our Consolidated Statements of Operations), which had an unfavorable impact to operating profit and Adjusted operating profit of approximately $45, or approximately 160 basis points to operating margin and Adjusted operating margin;

• foreign currency translation, had an unfavorable impact of approximately $10 to operating profit and $25 to Adjusted operating profit and a negligible impact to operating margin and Adjusted operating margin; and

• higher foreign exchange net gains on our working capital (classified within other expense, net in our Consolidated Statements of Operations) as compared to loss in the prior year, resulting in a favorable impact of approximately $40 before tax on both a reported and Adjusted basis.

Segment Review

We determine segment profit by deducting the related costs and expenses from segment revenue. Segment profit includes an allocation of global marketing and digital expenses based on actual revenues. Segment profit excludes global expenses other than the allocation of marketing and digital, CTI restructuring initiatives, certain significant asset impairment charges, and other expenses, 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. See Note 13, Segment Information, to the Consolidated Financial Statements included herein for a reconciliation of segment profit to operating profit.

47

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

Europe, Middle East & Africa

	Three Months Ended June 30,										Six Months Ended June 30,
							%/Basis Point Change										%/Basis Point Change
	2019			2018			US$		Constant $		2019			2018			US$		Constant $
Total revenue	$	425.1		$	500.7		(15	)%	(8	)%	$	883.8		$	1,069.1		(17	)%	(9	)%
Segment profit	59.0			74.4			(21	)%	(15	)%	118.2			148.8			(21	)%	(11	)%
Segment margin	13.9		%	14.9		%	(100	)	(110	)	13.4		%	13.9		%	(50	)	(40	)
Change in Active Representatives									(9	)%									(10	)%
Change in units sold									(14	)%									(15	)%

Amounts in the table above may not necessarily sum due to rounding.

Three Months Ended June 30, 2019

Total revenue decreased 15% compared to the prior-year period owing to the unfavorable impact of foreign exchange which was driven by the strengthening of the U.S. dollar relative to multiple currencies, primarily the South African Rand and Turkish lira. On a Constant $ basis, revenue decreased 8%. Revenue and Constant $ revenue were negatively impacted by a decrease in Active Representatives, partially offset by an increase in Average Representative Sales. The decline in Active Representatives was across multiple markets in Europe, Middle East & Africa, primarily Russia.

In Russia, revenue decreased 15%, unfavorably impacted by foreign exchange. On a Constant $ basis, Russia's revenue decreased 12%. Revenue and Constant $ revenue in Russia were negatively impacted primarily by a decrease in Active Representatives. Revenue and Constant $ revenue in Russia continued to be impacted by lower market consumption, as well as weaker sales leader engagement. The latter has been actively addressed through a heavy focus on recruitment which resulted in a slow-down of the decline in Revenue and Active Representatives in comparison to the prior quarter.

In the UK, revenue decreased 17%, unfavorably impacted by foreign exchange. On a Constant $ basis, the UK's revenue decreased 12%. Revenue and Constant $ revenue in the UK were negatively impacted by lower Average Representative Sales and a decrease in Active Representatives, as a result of a continuation of underlying field issues.

Segment margin decreased 100 basis points, or 110 basis points on a Constant $ basis, as the decline of 180 basis points in gross margin was not entirely offset by the net benefit of 70 basis points from tight control over SG&A.

The gross margin decline of 180 basis points was primarily caused by the impact of lower production volumes on supply chain costs (220 basis points negative impact). The impact of price/mix more than offset the unfavorable impact of foreign currency net losses (190 basis points benefit from price/mix compared to a 160 basis points unfavorable impact from foreign exchange).

Savings in SG&A were driven by tight cost management and restructuring initiatives, as well as the re-allocation of resources from advertising into representative and sales leader investments / trainings across most markets in EMEA, with a focus on major markets. Lower fixed costs (benefit of 140 basis points) and lower advertising expense (benefit of 40 basis points) were re-allocated into representative and sales leader investments and training (unfavorable impact of 130 basis points).

Six Months Ended June 30, 2019

Total revenue decreased 17% compared to the prior-year period, owing to the unfavorable impact of foreign exchange which was driven by the strengthening of the U.S. dollar relative to multiple currencies, primarily the Russian ruble, Turkish lira and the South African rand. On a Constant $ basis, revenue decreased 9%. Revenue and Constant $ revenue were negatively impacted by a decrease in Active Representatives, partially offset by higher Average Representative Sales. The decline in Active Representatives was across multiple markets in Europe, Middle East & Africa, primarily Russia.

In Russia, revenue decreased 25%, unfavorably impacted by foreign exchange. On a Constant $ basis, Russia's revenue decreased 16%. Revenue and Constant $ revenue in Russia were negatively impacted primarily by a decrease in Active Representatives. Revenue and Revenue and Constant $ revenue in Russia continued to be impacted by lower market consumption, as well as weaker sales leader engagement. The latter has been actively addressed in the second quarter of 2019 through a heavy focus on recruitment which resulted in a slow-down of the decline in Revenue and Active Representatives in comparison to the first quarter of 2019.

48

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

In the UK, revenue decreased 17%, unfavorably impacted by foreign exchange. On a Constant $ basis, the UK's revenue decreased 12%. The decrease in Revenue and Constant $ revenue in the UK was entirely resulting from the decrease in Active Representatives, driven by the continuation of underlying field issues.

Segment margin decreased 50 basis points, or 40 basis points on a Constant $ basis, as the decline of 140 basis points in gross margin was not entirely offset by the net benefit of 100 basis points from tight control over SG&A.

The gross margin decline of 140 basis points was primarily caused by the impact of lower production volumes on supply chain costs (100 basis points negative impact), the impact of price/mix fully offset the unfavorable impact of foreign currency net losses (160 basis points benefit from price/mix compared to a 140 basis points unfavorable impact from foreign exchange).

Savings in SG&A were driven by tight cost management and restructuring initiatives, as well as the re-allocation of resources from advertising into representative and sales leader investments / trainings across most markets in EMEA, with a focus on major markets. Lower fixed costs (benefit of 90 basis points) and lower advertising costs (benefit of 70 basis points) were re-allocated into representative and sales leader investments and training (unfavorable impact of 60 basis points).

South Latin America

	Three Months Ended June 30,										Six Months Ended June 30,
							%/Basis Point Change										%/Basis Point Change
	2019			2018			US$		Constant $		2019			2018			US$		Constant $
Total revenue	$	443.0		$	516.1		(14	)%	—	%	$	857.7		$	1,013.2		(15	)%	—	%
Segment profit	65.2			55.2			18	%	42	%	89.0			82.4			8	%	39	%
Segment margin	14.7		%	10.7		%	400		450		10.4		%	8.1		%	220		310
Change in Active Representatives									(12	)%									(9	)%
Change in units sold									(17	)%									(14	)%

Amounts in the table above may not necessarily sum due to rounding.

Three Months Ended June 30, 2019

Total revenue decreased 14% compared to the prior-year period entirely driven by the unfavorable impact of foreign exchange, which was primarily resulting from the strengthening of the U.S. dollar relative to the Brazilian real and the Argentinian peso. On a Constant $ basis, revenue was relatively unchanged. Revenue and Constant $ revenue benefited from higher Average Representative Sales, driven by Brazil and Argentina, offset by a decrease in Active Representatives. The decline in Active Representatives was primarily driven by Brazil.

Revenue in Brazil decreased 9%, unfavorably impacted by foreign exchange, while Brazil's Constant $ revenue was relatively unchanged. Revenue and Constant $ revenue in Brazil were negatively impacted by a decrease in Active Representatives, which continued to be impacted by competitive pressures. The decrease in Active Representatives was offset by higher Average Representative Sales, which was impacted by improved price/mix. In addition, Average Representative Sales were favorably impacted by certain indirect tax items recognized in the quarter, as well as a positive impact from the Brazil IPI tax compared to the prior-year period. For additional details on the IPI tax on cosmetics in Brazil, see Note 11, Contingencies, to the Consolidated Financial Statements included herein.

Revenue in Argentina declined 32%, unfavorably impacted by foreign exchange. On a Constant $ basis, Argentina's revenue grew 31%. Revenue and Constant $ revenue in Argentina benefited from higher Average Representative Sales, which was impacted by improved revenue growth management including inflationary pricing and training.

Segment margin increased 400 basis points, or 450 basis points on a Constant $ basis, as SG&A benefits of 660 basis points more than offset the decline of 210 basis points in gross margin.

Gross margin declined by 210 basis points despite the impact of certain indirect tax items on revenue (favorable impact of 240 basis points). The gross margin decline was primarily caused by higher supply chain costs driven by higher material costs (unfavorable impact of 210 basis points) and the impact of price/mix not fully offsetting the unfavorable impact of foreign currency net losses (270 basis points benefit compared to a 320 basis points unfavorable impact from foreign exchange).

49

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

Savings in SG&A were driven primarily by Brazil in multiple areas such as lower advertising expense due to certain indirect tax items (benefit of 330 basis points), continuous reduction of bad debt expense due to improved credit control and collections processes (benefit of 190 basis points), lower fixed costs resulting from tight cost management and restructuring initiatives (benefit of 80 basis points) and lower transportation costs decreasing in line with the decline in Active Representatives (benefit of 40 basis points).

Six Months Ended June 30, 2019

Total revenue decreased 15% compared to the prior-year period entirely driven by the unfavorable impact of foreign exchange, which was primarily driven by the strengthening of the U.S. dollar relative to the Brazilian real and the Argentinian peso. On a Constant $ basis, revenue was relatively unchanged. Revenue and Constant $ revenue benefited from higher Average Representative Sales, driven by Brazil and Argentina, partially offset by a decrease in Active Representatives. The decline in Active Representatives was primarily driven by a decline in Brazil.

Revenue in Brazil decreased 13%, unfavorably impacted by foreign exchange, while Brazil's Constant $ revenue decreased 1%. Revenue and Constant $ revenue in Brazil were negatively impacted by a decrease in Active Representatives, which continued to be negatively impacted by competitive pressures. The decrease in Active Representatives was offset by higher Average Representative Sales, which was impacted by improved price/mix. In addition, Average Representative Sales were favorably impacted by certain indirect tax items recognized in the quarter, as well as a positive impact from the Brazil IPI tax compared to the prior-year period. For additional details on the IPI tax on cosmetics in Brazil, see Note 11, Contingencies, to the Consolidated Financial Statements included herein.

Revenue in Argentina declined 29%, unfavorably impacted by foreign exchange. On a Constant $ basis, Argentina's revenue grew 37%. Revenue and Constant $ revenue in Argentina benefited from higher Average Representative Sales, which was impacted by improved revenue growth management including inflationary pricing and training.

Segment margin increased 220 basis points, or 310 basis points on a Constant $ basis, as SG&A benefits of 500 basis points more than offset the decline of 190 basis points in gross margin.

The gross margin decline of 190 basis was primarily caused by higher supply chain costs driven by higher material costs (unfavorable impact of 100 basis points) and price/mix not fully offsetting the unfavorable impact of foreign currency net losses (120 basis points benefit compared to a 200 basis points unfavorable impact).

Savings in SG&A were driven primarily by Brazil in multiple areas, such as, lower advertising expense due to certain indirect tax items and concentrated investments in selected channels (benefit of 220 basis points), a reduction of bad debt expense due to improved credit control and collections processes (benefit of 170 basis points) and lower fixed costs resulting from tight cost management and restructuring initiatives (benefit of 40 basis points).

North Latin America

	Three Months Ended June 30,										Six Months Ended June 30,
							%/Basis Point Change										%/Basis Point Change
	2019			2018			US$		Constant $		2019			2018			US$		Constant $
Total revenue	$	193.8		$	207.3		(7	)%	(6	)%	$	386.5		$	402.9		(4	)%	(3	)%
Segment profit	19.1			19.0			1	%	—	%	35.6			39.8			(11	)%	(10	)%
Segment margin	9.9		%	9.2		%	70		60		9.2		%	9.9		%	(70	)	(70	)
Change in Active Representatives									(10	)%									(9	)%
Change in units sold									(8	)%									(6	)%

Amounts in the table above may not necessarily sum due to rounding.

Three Months Ended June 30, 2019

North Latin America consists largely of our Mexico business. Total revenue for the segment declined 7% compared to the prior-year period also unfavorably impacted by foreign exchange. On a Constant $ basis, revenue declined 6%. Revenue and Constant $ revenue declined driven by a decrease in Active Representatives, which was partially offset by higher Average Representative Sales.

Revenue in Mexico decreased 4% compared to the prior year period, favorably impacted by foreign exchange. On a Constant $ basis, Mexico's revenue decreased 5%. Constant $ revenue decline in Mexico was primarily due to a decrease in Active

50

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

Representatives, partially offset by higher Average Representative Sales, both driven by strategic initiatives to focus on Representative productivity via Representative segmentation and training.

Segment margin increased 70 basis points on a reported basis, and 60 basis points on a Constant $ basis, driven by an increase of 150 basis points from lower SG&A expense offset by a decline of 90 basis points in gross margin.

The gross margin declined by 90 basis, primarily as a result of financial adjustments including the timing of 2019 sales incentives deferred during the period (unfavorable 170 basis points), the favorable impact of price/mix (benefit 200 basis points) more than offset by the impact of foreign currency (unfavorable 110 basis points).

SG&A cost savings were driven by lower fixed expenses resulting from tight cost management and restructuring initiatives (benefit of 130 basis points), lower representative and sales leader investments in incentives, linked to the decrease in Active Representative (benefit of 170 basis points), partially offset by higher brochure cost (unfavorable impact of 50 basis points) and higher transportation costs aimed to improve service quality (unfavorable impact of 60 basis points).

Six Months Ended June 30, 2019

North Latin America consists largely of our Mexico business. Total revenue for the segment declined 4% compared to the prior-year period also unfavorably impacted by foreign exchange. On a Constant $ basis, revenue declined 3%. Revenue and Constant $ revenue declined from a decrease in Active Representatives offset by higher Average Representative Sales.

Revenue and Constant $ Revenue in Mexico decreased 2% compared to the prior year period, with negligible impact of foreign exchange. The decline in reported and Constant $ revenue in Mexico was primarily due to decline in Active Representatives, partially offset by higher Average Representative Sales, both driven by strategic initiatives to focus on Representative productivity via Representative segmentation and training.

Segment margin decreased 70 basis points on both a reported and Constant $ basis, due to a decline of 110 basis points in gross margin partially offset by an increase of 50 basis points from SG&A savings.

The gross margin decline of 110 basis points was primarily caused by price/mix not fully offsetting the unfavorable impact of foreign currency net losses (100 basis points benefit compared to a 170 basis points unfavorable impact).

SG&A cost savings were driven by lower representative and sales leader investments in incentives linked to the decrease in Active Representative (benefit of 100 basis points) and lower fixed expenses resulting from tight cost management and restructuring initiatives (benefit of 60 basis points), partially offset by higher bad debt expense (unfavorable impact of 80 basis points) and higher transportation cost aimed to improve service quality (unfavorable impact of 30 basis points).

Asia Pacific

	Three Months Ended June 30,										Six Months Ended June 30,
							%/Basis Point Change										%/Basis Point Change
	2019			2018			US$		Constant $		2019			2018			US$		Constant $
Total revenue	$	108.4		$	113.1		(4	)%	(3	)%	$	223.7		$	224.5		—	%	2	%
Segment profit	10.8			7.3			48	%	41	%	27.5			17.7			55	%	54	%
Segment margin	10.0		%	6.5		%	350		310		12.3		%	7.9		%	440		410
Change in Active Representatives									(9	)%									(10	)%
Change in units sold									(9	)%									(5	)%

Amounts in the table above may not necessarily sum due to rounding.

Three Months Ended June 30, 2019

Total revenue decreased 4% compared to the prior-year period, partially due to the unfavorable impact of foreign exchange. On a Constant $ basis, revenue decreased 3%. Revenue and Constant $ revenue declined driven by a decrease in Active Representatives, across most markets, partially offset by higher Average Representative Sales.

Revenue in the Philippines increased 2%, favorably impacted by foreign exchange. On a Constant $ basis, revenue in the Philippines increased 1%. Revenue and Constant $ revenue growth in the Philippines benefited from the impact of inventory system implementation issues in the prior-year period resulting in a lower revenue base. Revenue and Constant $ revenue in the Philippines

51

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

increased as a result of higher Average Representative Sales primarily due to effective pricing partially offset by a decrease in Active Representatives as significant sales leader recruitment efforts in the prior year were not repeated.

Segment margin increased 350 basis points, or 310 basis points on a Constant $ basis, due to both gross margin increase of 170 basis points and lower SG&A expense of 140 basis points.

The gross margin benefit of 170 basis was primarily due to improved price/mix in most markets (benefit of 120 basis points) plus the benefit from higher logistics costs in the prior year in the Philippines to address service disruptions caused by the inventory system implementation (benefit of 100 basis points).

Savings in SG&A were driven by lower fixed expenses primarily resulting from an impairment of the inventory system in the Philippines recognized in the second quarter of 2018 (benefit of 220 basis points) partially offset by higher marketing investments including advertising to continue to develop our e-commerce business (unfavorable impact of 100 basis points).

Six Months Ended June 30, 2019

Asia Pacific consists largely of our Philippines business. Total revenue was relatively unchanged compared to the prior-year period, due to the unfavorable impact of foreign exchange. On a Constant $ basis, revenue increased 2%. Revenue and Constant $ Revenue benefited from higher Average Representative Sales, partially offset by a decrease in Active Representatives, across most markets.

Revenue and Constant $ Revenue in the Philippines increased 6%, with negligible impact from foreign exchange. Revenue and Constant $ Revenue in the Philippines benefited from the impact of inventory system implementation issues in the prior-year period resulting in a lower revenue base. Revenue and Constant $ Revenue in the Philippines benefited from higher Average Representative Sales, primarily due to effective pricing partially offset by a decrease in Active Representatives as significant sales leader recruitment efforts in the prior year were not repeated.

Segment margin increased 440 basis points, or 410 basis points on a Constant $ basis, due to both lower SG&A expense of 280 basis points and gross margin increase of 130 basis points.

The gross margin benefit of 130 basis was primarily due to improved price/mix in most markets (benefit of 110 basis points) plus the benefit from higher logistics costs in the prior year in the Philippines, to address service disruptions caused by the inventory system implementation (benefit of 70 basis points), partially offset by higher supply chain costs driven by higher material costs (unfavorable impact of 50 basis points).

Savings in SG&A were mainly from lower fixed expenses primarily resulting from an impairment of the inventory system in the Philippines recognized in the second quarter of 2018 and a one-off benefit following the closure of a 2014 tax audit (benefit of 220 basis points) and lower representative and sales leader investments (benefit of 60 basis points).

52

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

LIQUIDITY AND CAPITAL RESOURCES

Our principal sources of funds historically have been cash flows from operations, public offerings of notes, bank financings, issuance of commercial paper, borrowings under lines of credit and a private placement of notes. As at June 30, 2019, the Company has a $387 debt maturity obligation due March 2020. In July 2019, the Company issued $400 in aggregate principal amount of 6.5% Senior Notes which will mature on 15 August 2022. The proceeds were partially used to purchase an aggregate principal amount of $275 of the Notes due March 2020 under a cash tender offer completed during July 2019.

The Company has cash on hand of $421 as of June 30, 2019 and has access to the unused portion of its revolving credit facility of €178.

We may seek to repurchase our equity or to retire our outstanding debt in open market purchases, privately negotiated transactions, through derivative instruments, cash tender offers or otherwise. Repurchases of equity and debt may be funded by cash, the incurrence of additional debt or the issuance of equity (including shares of preferred stock) or convertible securities and will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors, and the amounts involved may be material. We may also elect to incur additional debt or issue equity (including shares of preferred stock) or convertible securities to finance ongoing operations or to meet our other liquidity needs. Any issuances of equity (including shares of preferred stock) or convertible securities could have a dilutive effect on the ownership interest of our current shareholders and may adversely impact earnings per share in future periods. Our credit ratings were downgraded during the past several years, which may impact our ability to access such transactions on favorable terms, if at all. For more information, see "Risk Factors - Our credit ratings were downgraded during the past several years, which could limit our access to financing, affect the market price of our financing and increase financing costs. A further downgrade in our credit ratings may adversely affect our access to liquidity," "Risk Factors - Our indebtedness and any future inability to meet any of our obligations under our indebtedness, could adversely affect us by reducing our flexibility to respond to changing business and economic conditions," and "Risk Factors - A general economic downturn, a recession globally or in one or more of our geographic regions or markets or sudden disruption in business conditions or other challenges may adversely affect our business, our access to liquidity and capital, and our credit ratings" contained in our 2018 Form 10-K.

Our liquidity could also be negatively impacted by restructuring initiatives, dividends, capital expenditures, acquisitions, and certain contingencies, including any legal or regulatory settlements, described more fully in Note 11, Contingencies, to the Consolidated Financial Statements included herein. See our Cautionary Statement for purposes of the "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995 contained in this report.

Cash Flows

Three months ended June 30, 2019

Net Cash Provided (Used) by Operating Activities of Continuing Operations

Net cash provided by operating activities of continuing operations during the second quarter of 2019 was approximately $7 as compared to net cash used by operating activities of continuing operations of approximately $10 during the second quarter of 2018, a increase of approximately $17. The improvement in net cash from operating activities was driven by higher cash generated from earnings, partially offset by an increase in restructuring payments. Net cash from operating activities was further improved by working capital as the reduction in inventory, associated with our Open Up Avon strategy, more than offset lower accounts payable and accrued liabilities due to the timing of payments.

Net Cash Provided (Used) by Investing Activities of Continuing Operations

Net cash provided by continuing investing activities during the second quarter of 2019 was approximately $19, as compared to net cash used by continuing investing activities of approximately $23 during the second quarter of 2018. The approximate $42 increase to net cash provided by continuing investing activities was primarily due to net proceeds from the sale of the Rye office and the sale of Maximin Corporation Sdn Bhd, both of which closed during the second quarter of 2019. Refer to Note 3, Discontinued Operations, Assets and Liabilities Held for Sale and Divestitures, to the Consolidated Financial Statements contained herein for more information relating to the sale of these businesses and assets.

Free Cash Flow Provided (Used) by Continuing Operations

We also present free cash flow as an additional financial measure for liquidity, which we believe provides an additional perspective on trends and underlying business results. Free cash flow is the sum of Net Cash (Used) Provided by Continuing Operating Activities and Net Cash Provided (Used) by Continuing Investing Activities, and was a net inflow of $26 compared to an outflow of $33, during the second quarter of 2019 and 2018, respectively.

53

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

Net Cash Used by Financing Activities of Continuing Operations

Net cash used by continuing financing activities during the second quarter of 2019 was approximately $28, as compared to $253 during the second quarter of 2018. The approximate $225 favorable impact to net cash from financing activities was primarily due to the prepayment of the Company's 6.5% Notes in the second quarter of 2018.

Six months ended June 30, 2019

Net Cash (Used) by Operating Activities of Continuing Operations

Net cash used by operating activities of continuing operations during the first six months of 2019 was approximately $136 as compared to approximately $107 during the first six months of 2018, an increase in usage of approximately $29. The year-over-year comparison of net cash used by continuing operating activities was unfavorably impacted by an increase in restructuring payments. Net cash from operations benefited from higher cash generated from earnings and improved working capital, driven by a reduction in inventory, partially offset by lower accounts payable and accrued liabilities due to the timing of payments.

Net Cash Provided (Used) by Investing Activities of Continuing Operations

Net cash provided by continuing investing activities during the first six months of 2019 was approximately $45, as compared to net cash used by continuing investing activities of approximately $50 during the first six months of 2018. The approximate $95 increase to net cash from investing activities was primarily due to net proceeds from the sale of Avon Manufacturing (Guangzhou), Ltd, which closed during the first quarter of 2019, the sale of the Rye office and the sale of Maximin Corporation Sdn Bhd, both of which closed during the second quarter of 2019. Refer to Note 3, Discontinued Operations, Assets and Liabilities Held for Sale and Divestitures, to the Consolidated Financial Statements contained herein for more information relating to the sale of these businesses and assets.

Free Cash Flow Used by Continuing Operations

We also present free cash flow as an additional financial measure for liquidity, which we believe provides an additional perspective on trends and underlying business results. Free cash flow is the sum of Net Cash (Used) Provided by Operating Activities of Continuing Operations and Net Cash Provided (Used) by Investing Activities of Continuing Operations, and was a net outflow of $91 and $157, respectively, during the first six months of 2019 and 2018.

Net Cash Used by Financing Activities of Continuing Operations

Net cash used by continuing financing activities during the first six months of 2019 was approximately $10, as compared to $252 during the first six months of 2018. The approximate $242 favorable impact to net cash from financing activities was primarily due the repayment of debt in the second quarter of 2018.

Capital Resources

Revolving Credit Facility

In June 2015, 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").

In February 2019, Avon International Capital, p.l.c. ("AIC"), a wholly-owned foreign subsidiary of the Company, entered into a three-year €200.0 million senior secured revolving credit facility (the "2019 facility"). The 2019 facility replaced the 2015 facility and the 2015 facility was terminated at such time. The 2019 facility will terminate in February 2022; provided, however, that it shall terminate on the 91st day prior to the maturity of the 4.60% Notes⁽¹⁾, if on such 91st day, the applicable notes are not redeemed, repaid, discharged, defeased or otherwise refinanced in full.

In July 2019, the Company issued $400 in aggregate principal amount of 6.5% Senior Notes which will mature on 15 August 2022. The proceeds were partially used to purchase the aggregate principal amount of $275 of the Notes, due March 2020, under a cash tender offer completed during July 2019.

As of June 30, 2019, we were in compliance with our interest coverage and total leverage ratios under the 2019 facility, as amended. The amount of the facility available to be drawn down on is reduced by any standby letters of credit granted by an obligor, which, as of June 30, 2019, was approximately $25. As of June 30, 2019, based on then applicable interest rates, the entire amount of the remaining 2019 facility, which is approximately €175 million, could have been drawn down without violating any covenant. Depending on our business results (including the impact of any adverse foreign exchange movements and significant restructuring charges), it is possible that we may be non-compliant with our interest coverage or total leverage ratio absent the Company undertaking other alternatives to avoid noncompliance, such as obtaining additional amendments to the 2019 facility or repurchasing

54

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

certain debt. If we were to be non-compliant with our interest coverage or total leverage ratio, we would no longer have access to our 2019 facility and our credit ratings may be downgraded. As of June 30, 2019, there were no amounts outstanding under the 2019 facility.

⁽¹⁾In March 2013, we issued, in a public offering $500.0 principal amount of 4.60% Notes due March 15, 2020, referred above as the "4.60% Notes"

55

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

FINANCIAL INSTRUMENTS AND RISK MANAGEMENT STRATEGIES

Interest Rate Risk

In the past we have used interest-rate swaps to manage our interest rate exposure. The interest-rate swaps were used to either convert our fixed rate borrowing to a variable interest rate or to unwind an existing variable interest-rate swap on a fixed rate borrowing. As of June 30, 2019, we do not have any interest-rate swap agreements. Approximately 25% and 1% of our debt portfolio at June 30, 2019 and December 31, 2018, respectively, was exposed to floating interest rates. For the purpose of this calculation, we consider all short-term debt to be exposed to floating interest rates.

Foreign Currency Risk

We conduct business globally, with operations in various locations around the world. Over the past three years, all of our consolidated revenue was derived from operations of subsidiaries outside of the U.S. The functional currency for most of our foreign operations is their local currency. We may reduce our exposure to fluctuations in cash flows associated with changes in foreign exchange rates by creating offsetting positions, including through the use of derivative financial instruments.

CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

Statements in this report (or in the documents it incorporates by reference) that are not historical facts or information may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "estimate," "project," "forecast," "plan," "believe," "may," "expect," "anticipate," "intend," "planned," "potential," "can," "expectation," "could," "will," "would" and similar expressions, or the negative of those expressions, may identify forward looking statements. They include, among other things, statements regarding our anticipated or expected results, future financial performance, various strategies and initiatives (including our Transformation Plan, Open Up Avon, stabilization strategies, cost savings initiatives, restructuring and other initiatives and related actions), costs and cost savings, competitive advantages, impairments, the impact of foreign currency, including devaluations, and other laws and regulations, government investigations, results of litigation, contingencies, taxes and tax rates, potential alliances or divestitures, liquidity, cash flow, uses of cash and financing, hedging and risk management strategies, pension, postretirement and incentive compensation plans, supply chain and the legal status of the Representatives. Such forward-looking statements are based on management's reasonable current assumptions, expectations, plans and forecasts regarding the Company's current or future results and future business and economic conditions more generally. Such forward-looking statements involve risks, uncertainties and other factors, which may cause the actual results, levels of activity, performance or achievement of Avon to be materially different from any future results expressed or implied by such forward-looking statements, and there can be no assurance that actual results will not differ materially from management's expectations. Therefore, you should not rely on any of these forward-looking statements as predictors of future events. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following:

• our ability to improve our financial and operational performance and execute fully our global business strategy, including our ability to implement the key initiatives of, and/or realize the projected benefits (in the amounts and time schedules we expect) from, our Transformation Plan, Open Up Avon, stabilization strategies, cost savings initiatives, restructuring and other initiatives, product mix and pricing strategies, enterprise resource planning, customer service initiatives, sales and operation planning process, outsourcing strategies, Internet platform and technology strategies including e-commerce, marketing and advertising strategies, information technology and related system enhancements and cash management, tax, foreign currency hedging and risk management strategies, and any plans to invest these projected benefits ahead of future growth;

• our ability to achieve the anticipated benefits of our strategic partnership with Cerberus Capital Management, L.P.;

• our broad-based geographic portfolio, which is heavily weighted towards emerging markets, a general economic downturn, a recession globally or in one or more of our geographic regions or markets, such as Brazil, Mexico or Russia, or sudden disruption in business conditions, and the ability to withstand an economic downturn, recession, cost inflation, commodity cost pressures, economic or political instability (including fluctuations in foreign exchange rates), competitive or other market pressures or conditions;

• the effect of economic factors, including inflation and fluctuations in interest rates and foreign currency exchange rates; as well as the designation of Argentina as a highly inflationary economy, and the potential effect of such factors on our business, results of operations and financial condition;

• the possibility of business disruption in connection with our Transformation Plan, Open Up Avon, stabilization strategies, cost savings initiatives, or restructuring and other initiatives;

56

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

• our ability to reverse declining revenue, to improve margins and net income, or to achieve profitable growth, particularly in our largest markets and developing and emerging markets, such as Brazil, Mexico and Russia;

• our ability to improve working capital and effectively manage doubtful accounts and inventory and implement initiatives to reduce inventory levels, including the potential impact on cash flows and obsolescence;

• our ability to reverse declines in Active Representatives, to enhance our sales leadership programs, to generate Representative activity, to increase the number of consumers served per Representative and their engagement online, to enhance branding and the Representative and consumer experience and increase Representative productivity through field activation and segmentation programs and technology tools and enablers, to invest in the direct-selling channel, to offer a more social selling experience, and to compete with other direct-selling organizations to recruit, retain and service Representatives and to continue to innovate the direct-selling model;

• general economic and business conditions in our markets, including social, economic and political uncertainties, such as in Russia and Ukraine or elsewhere, and any potential sanctions, restrictions or responses to such conditions imposed by other markets in which we operate;

• the effect of political, legal, tax, including changes in tax rates, and other regulatory risks imposed on us abroad and in the U.S., our operations or the Representatives, including foreign exchange, pricing, data privacy or other restrictions, the adoption, interpretation and enforcement of foreign laws, including in jurisdictions such as Brazil and Russia, and any changes thereto, as well as reviews and investigations by government regulators that have occurred or may occur from time to time, including, for example, local regulatory scrutiny;

• competitive uncertainties in our markets, including competition from companies in the consumer packaged goods industry, some of which are larger than we are and have greater resources;

• the impact of the adverse effect of volatile energy, commodity and raw material prices, changes in market trends, purchasing habits of our consumers and changes in consumer preferences, particularly given the global nature of our business and the conduct of our business in primarily one channel;

• our ability to attract and retain key personnel;

• other sudden disruption in business operations beyond our control as a result of events such as acts of terrorism or war, natural disasters, pandemic situations, large-scale power outages and similar events;

• key information technology systems, process or site outages and disruptions, and any cyber security breaches, including any security breach of our systems or those of a third-party provider that results in the theft, transfer or unauthorized disclosure of Representative, customer, employee or Company information or compliance with information security and privacy laws and regulations in the event of such an incident which could disrupt business operations, result in the loss of critical and confidential information, and adversely impact our reputation and results of operations, and related costs to address such malicious intentional acts and to implement adequate preventative measures against cyber security breaches;

• our ability to comply with various data privacy laws affecting the markets in which we do business;

• the risk of product or ingredient shortages resulting from our concentration of sourcing in fewer suppliers;

• any changes to our credit ratings and the impact of such changes on our financing costs, rates, terms, debt service obligations, access to lending sources and working capital needs;

• the impact of our indebtedness, our access to cash and financing, and our ability to secure financing or financing at attractive rates and terms and conditions;

• the impact of our business results (including the impact of any adverse foreign exchange movements and significant restructuring charges), on our ability to comply with certain covenants in our revolving credit facility;

• our ability to successfully identify new business opportunities, strategic alliances and strategic alternatives and identify and analyze alliance candidates, secure financing on favorable terms and negotiate and consummate alliances;

• disruption in our supply chain or manufacturing and distribution operations;

• the quality, safety and efficacy of our products;

• the success of our research and development activities;

• our ability to protect our intellectual property rights, including in connection with the separation of the North America business;

57

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(U.S. dollars in millions, except per share data)

• our ability to repurchase the series C preferred stock in connection with a change of control;

• the risk of an adverse outcome in any material pending and future litigation or with respect to the legal status of Representatives; and

• other risks and uncertainties include the timing and likelihood of completion of the proposed combination of the Company and Natura, including the timing, receipt and terms and conditions of any required governmental and regulatory approvals for the proposed transactions that could reduce anticipated benefits or cause the parties to abandon the transactions; the possibility that the Company’s shareholders may not approve the proposed transactions; the possibility that Natura’s shareholders may not approve the proposed transactions; the possibility that the expected synergies and value creation from the proposed transactions will not be realized or will not be realized within the expected time period; the risk that the businesses of the Company and Natura will not be integrated successfully; disruption from the proposed transactions making it more difficult to maintain business and operational relationships; the risk that unexpected costs will be incurred; the possibility that the proposed transactions do not close, including due to the failure to satisfy the closing conditions; the possibility that the intended accounting and tax treatments of the proposed transactions are not achieved; the effect of the announcement, pendency or consummation of the proposed transactions on customers, employees, representatives, suppliers and partners and operating results; as well as more specific risks and uncertainties .

Additional information identifying such factors is contained in Item 1A of our 2018 Form 10-K for the year ended December 31, 2018, and other reports and documents we file with the SEC. We undertake no obligation to update any such forward-looking statements.

58

AVON PRODUCTS, INC.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes in market risk from the information provided in Item 7A, Quantitative and Qualitative Disclosures About Market Risk, of our 2018 Form 10-K.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this report, our principal executive and principal financial officers carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rule 13a-15 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management was required to apply its judgment in evaluating and implementing possible controls and procedures. Based upon their evaluation, the principal executive and principal financial officers concluded that our disclosure controls and procedures were effective as of June 30, 2019, at the reasonable assurance level. Disclosure controls and procedures are designed to ensure that information relating to Avon (including our consolidated subsidiaries) required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the United States Securities and Exchange Commission’s rules and forms and to ensure that information required to be disclosed is accumulated and communicated to management to allow timely decisions regarding disclosure.

Changes in Internal Control over Financial Reporting

Our management has evaluated, with the participation of our principal executive and principal financial officers, whether any changes in our internal control over financial reporting that occurred during our last fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Based on the evaluation we conducted, our management has concluded that no such changes have occurred.

59

AVON PRODUCTS, INC.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

See Note 11, Contingencies, to the Consolidated Financial Statements included herein.

ITEM 1A. RISK FACTORS

Risks Relating to the Transaction

The timing and completion of the Transaction is subject to a number of important conditions and other uncertainties, and the Merger Agreement may be terminated before the completion of the Transaction in accordance with its terms. As a result, there is no assurance as to whether and when the Transaction will be completed.

As described elsewhere in this Quarterly Report on Form 10-Q, we have entered into a Merger Agreement with Natura Cosméticos, Natura &Co Holding and two subsidiaries of Natura &Co Holding, pursuant to which, in a series of transactions, Avon and Natura Cosméticos will each become direct wholly owned subsidiaries of Natura &Co Holding. The timing and completion of the Transaction is subject to a number of closing conditions, including (i) Avon and Natura Cosméticos shareholder approvals having been obtained in accordance with applicable law, (ii) clearance from competition authorities in certain jurisdictions where Avon and Natura Cosméticos operate, (iii) the absence of any judgment, injunction or other order issued by a court of competent jurisdiction prohibiting the Transaction, (iv) effectiveness of registration statements for Natura &Co Holding’s ADSs, (v) listing approval for Natura &Co Holding’s ADSs on the NYSE, (vi) listing approval for Natura &Co Holding’s shares on the B3 stock exchange under the Novo Mercado listing segment and (vii) subject to certain materiality exceptions, the accuracy of Avon’s, Natura Cosméticos’s and Natura &Co Holding’s representations and warranties in the Merger Agreement and performance by each party of their obligations under the Merger Agreement.

The failure to satisfy the foregoing conditions could delay completion of the Transaction for a significant period of time or prevent it from occurring. Any delay in completing the Transaction could cause us not to realize some or all of its expected benefits. Further, there can be no assurance that the conditions to the closing of the Transaction will be satisfied or, so far as applicable, waived or that the Transaction will be completed. If these conditions are not satisfied or, if applicable, waived by July 22, 2020, the Merger Agreement may be terminated by either party, subject to certain exceptions. Likewise, the Transaction may be completed on terms that differ, perhaps substantially, from those described in the Merger Agreement.

Failure to complete the Transaction could negatively impact our share price and our future business and financial results.

If the Transaction is not completed for any reason, our ongoing business may be adversely affected and, without realizing any of the benefits of having completed the Transaction, we would be subject to a number of risks, including the following:

• We may be required, under certain circumstances, to pay Natura Cosméticos a termination fee of approximately U.S.$78.6 million;

• We may experience negative reactions from the financial markets, including negative impacts on our share prices; and

• We may experience negative reactions from our customers, regulators and employees.

In addition, we could be subject to litigation related to any failure to complete the Transaction or related to any enforcement proceeding commenced against us to perform our obligations under the Merger Agreement. If the Transaction is not completed, these risks may materialize and may adversely affect our business, financial condition, financial results and/or share price.

In order to complete the Transaction, we and Natura Cosméticos must obtain certain governmental and regulatory approvals, and if such approvals are not granted or are granted with conditions, completion of the Transaction may be jeopardized or the anticipated benefits of the Transaction could be reduced.

Consummation of the Transaction is subject to governmental and regulatory approvals, including approval and review by the Administrative Council for Economic Defense (“CADE”) in Brazil and certain other jurisdictions (or the waiting period with respect thereto shall have expired or been terminated). There is no assurance that all governmental and regulatory approvals will be obtained.

In addition, certain of the governmental authorities from which these authorizations are required have broad discretion in administering the governing regulations. Prior to their authorization of the Transaction, these governmental authorities may impose requirements, limitations or costs, which may result in the delay or abandonment of the Transaction. After the completion of the

60

AVON PRODUCTS, INC.

Transaction, such governmental authorities may require divestitures or place restrictions on the conduct of our business, which may materially limit our revenues following the Transaction, or otherwise adversely affect, including to a material extent, our strategic plans and its businesses and results of operations.

Furthermore, governmental authorities could seek to block or challenge the Transaction as they deem necessary or desirable in the public interest at any time, including after completion of the Transaction. In addition, in some circumstances, a competitor, customer or other third party could initiate a private action under antitrust laws challenging or seeking to enjoin a portion or all of the Transaction, before it is consummated. We may not prevail and may incur significant costs in defending or settling any action under antitrust laws.

If the Transaction is consummated, the expected benefits from integrating our operations with Natura & Co's operations may not be achieved.

The success of the Transaction will depend, in part, on the ability of Natura Cosméticos and its subsidiaries (including Aesop, The Body Shop and their respective subsidiaries) (collectively, "Natura &Co") and Avon to realize the expected benefits from integrating their respective operations. No assurance can be given that Natura &Co and Avon will be able to integrate their respective operations without encountering difficulties, which may include, among other things, the loss of key employees, diversion of management attention, the disruption of our respective ongoing businesses or possible inconsistencies in standards, procedures and policies. Additionally, Natura &Co and Avon may be required to make unanticipated capital expenditures or investments in order to maintain, integrate, improve or sustain our operations. Integrating our respective operations may involve additional unanticipated costs and financial risks, such as the incurrence of unexpected write-offs, the possible effect of adverse tax and accounting treatments and unanticipated or unknown liabilities relating to Natura &Co or Avon. All of these factors could decrease or delay the expected accretive effect of the Transaction.

Even if our respective operations are successfully integrated, we may not realize the full benefits of the Transaction, including the synergies, cost savings and growth opportunities, within the expected time frame, if at all. Natura &Co and Avon continue to evaluate the estimates of synergies to be realized from, and the fair value accounting allocations associated with, the Transaction. However, the actual cost savings, the costs required to realize the cost savings and the source of the cost savings could differ materially from the estimates of Natura &Co and Avon.

Further, Natura &Co and Avon may not achieve the targeted operating or long-term strategic benefits of the Transaction. In addition, Natura &Co and Avon may not accelerate growth by increasing investments in digital, product innovation and brand initiatives. If Natura &Co and Avon are unable to achieve the objectives, or are not able to achieve our objectives on a timely basis, the anticipated benefits of the Transaction may not be realized fully or at all. An inability to realize the full extent of, or any of, the anticipated benefits of the Transaction could have an adverse effect on the financial condition, results of operations and cash flows of Natura &Co and Avon and could limit Natura &Co’s and Avon’s ability to achieve the anticipated benefits of the Transaction.

The Transaction will result in a change of control under our 2019 facility and 6.95% Notes due 2043.

The Transaction will result in a change of control under our 2019 facility. Upon the occurrence of such a change of control, the 2019 facility provides that the facility will be cancelled and all outstanding utilizations, accrued interest, amounts owing under any ancillary facility and any other amounts outstanding thereunder shall become immediately due and payable. Natura may seek to obtain a waiver of the change of control from the lenders of the 2019 facility. If Natura Cosméticos is unable to obtain a waiver of the change of control or chooses not to seek such a waiver and our 2019 facility is cancelled, there are no assurances that Natura Cosméticos will obtain replacement financing, if at all, or the timing for doing so. If the 2019 facility is cancelled and there is no replacement financing and Natura & Co Holding does not otherwise provide Avon with a source of liquidity, it could adversely impact our business, prospects, reputation and financial condition.

The Transaction will also result in a change of control under our 6.95% Notes due 2043. Natura Cosméticos may seek to obtain a waiver of the change of control from a majority of such notes. If Natura Cosméticos is unable to obtain a waiver of the change of control or chooses not to seek such a waiver, holders of those notes will have the option to have their notes repurchased at a purchase price of 101% plus accrued and unpaid interest. To fund the purchase of any such notes that are tendered in a change of control offer, Natura Cosméticos has obtained committed backstop financing for a senior secured bridge facility, but the availability of such committed financing is subject to customary conditions and there are no assurances that Natura Cosméticos will not obtain alternative financing in lieu thereof and, if so, the terms thereof.

61

AVON PRODUCTS, INC.

Third parties may terminate or alter existing contracts or relationships with us as a result of the announcement, pendency or completion of the Transaction.

We have contracts with customers, employees, Representatives, suppliers, vendors, distributors, landlords, lenders, licensors, joint venture partners and other business partners, and these contracts may require us to obtain consent from these other parties in connection with the Transaction. If these consents cannot be obtained, the counterparties to these contracts may seek to terminate or otherwise materially adversely alter the terms of such contracts following the Transaction, which in turn may result in us suffering a loss of potential future revenue, incurring contractual liabilities or losing rights that are material to our business. Further, parties with which we have business and operational relationships may experience uncertainty as to the future of such relationships and may delay or defer certain business decisions, seek alternative relationships with third parties or seek to alter their present business relationships with us. Parties with whom we otherwise may have sought to establish business relationships may seek alternative relationships with third parties.

In addition, current and prospective employees and Representatives may experience uncertainty about their roles following the Transaction and such uncertainty may have an effect on our corporate culture. There can be no assurance we will be able to attract and retain key talent, including senior leaders, to the same extent that we have previously been able to attract and retain employees and sales representatives. Any loss or distraction of our customers, employees, Representatives, suppliers, vendors, distributors, landlords, lenders, licensors, joint venture partners and other business partners, could have a material adverse effect on our business, financial condition, operating results and cash flows and could limit our ability to achieve the anticipated benefits of the Transaction. The adverse effect of such disruptions could also be exacerbated by a delay in the completion of the Transaction or the termination of the Merger Agreement.

The Merger Agreement subjects us to restrictions on our business activities prior to completion of the merger.

The Merger Agreement subjects us to restrictions on our business activities and obligates us to generally operate our business in the ordinary course in all material respects consistent with past practice prior to completion of the Transaction. These restrictions could prevent us from pursuing attractive business opportunities that arise prior to the completion of the Transaction and are outside the ordinary course of business, or otherwise have an adverse effect on our results of operations, cash flows and financial position.

The Merger Agreement contains provisions that restrict our ability to pursue alternatives to the Transaction and, in specified circumstances, could require us to pay the other party a termination fee.

We are subject to restrictions on our ability to pursue alternatives to the Transaction. These provisions could discourage a third party that may have an interest in acquiring all or a significant part of Avon from considering or proposing such an acquisition, even if such third party were prepared to enter into a transaction that would be more favorable to Avon and their respective shareholders than the Transaction.

The Transaction may be subject to litigation, which could delay the Transaction and prevent the Transaction from being completed.

We may in the future be party to legal proceedings and claims related to the Transaction. Legal challenges to the Transaction could result in an injunction, preventing or delaying the completion of the Transaction.

If the Transaction is consummated, it may limit our ability to utilize existing tax credits

As of December 31, 2018, we had approximately $833 million of foreign tax and other credits available to offset future income for U.S. federal tax purposes. Our ability to utilize such credits to offset future income could be limited, however, if the Company undergoes an “ownership change” within the meaning of Section 382 of the Code. In general, an ownership change will occur if there is a cumulative increase in ownership of our stock by 5% shareholders (as defined in the Code) that exceeds 50 percentage points over the lowest percentage of stock owned by such shareholders at any time over a rolling three-year period. If the 50 percentage points are exceeded, Section 382 establishes an annual limitation on the amount of deferred tax assets attributable to previously incurred credits that may be used to offset taxable income in future years. A number of complex rules apply in calculating this limitation, and any such limitation would depend in part on the market value of the Company at the time of the ownership change and prevailing interest rates at the time of calculation. An ownership change would occur if the Merger were consummated and, accordingly, all or a portion of our deferred tax assets may become subject to this limitation and as a result thereof, our tax liability could increase and our future results of operations and cash flows could be adversely impacted.

62

AVON PRODUCTS, INC.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

(c) Repurchases

The following table provides information about our purchases of our common stock during the quarterly period ended June 30, 2019:

	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Programs	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program
4/1 - 4/30/19	435,124	$	2.68	*	*
5/1 - 5/31/19	—	—		*	*
6/1 - 6/30/19	—	—		*	*
Total	435,124	$	2.68	*	*

* These amounts are not applicable as the Company does not have a share repurchase program in effect.

63

AVON PRODUCTS, INC.

ITEM 6. EXHIBITS

2.1	Agreement and Plan of Mergers, dated as of May 22, 2019, among Avon Products, Inc., Natura Cosméticos S.A., Nectarine Merger Sub I, Inc., Nectarine Merger Sub II, Inc. and Natura Holding S.A (incorporated by reference to Exhibit 2.1 to Avon's Current Report on Form 8-K filed on May 24, 2019).
3.1	Bylaws of Avon Products, Inc (incorporated by reference to Exhibit 3.1 to Avon's Current Report on Form 8-K filed on May 17, 2019)
4.1	Indenture, dated July 3, 2019, among Avon International Capital p.l.c., the guarantors party thereto and Deustche Bank Trust Company Americas, as trustee and collateral agent (incorporated by reference to Exhibit 4.1 to Avon's Current Report on Form 8-K filed on July 3, 2019).
10.1	Parent Shareholder Support Agreement, dated as of May 22, 2019, among Antonio Luiz da Cunha Seabra, Lucia Helena Rios Seabra, Guilherme Peirão Leal, Pedro Luiz Barreiros Passos, Utopia Participações S.A., Felipe Pedroso Leal, Ricardo Pedroso Leal, Passos Participações S.A. and Fundo de Investimento de Ações Veredas - Investimento No Exterior, Natura Cosméticos S.A., Natura Holding S.A. and Avon Products, Inc. (incorporated by reference to Exhibit 10.1 to Avon's Current Report on Form 8-K filed on May 24, 2019).
10.2	Avon Products, Inc. 2016 Omnibus Incentive Plan (Amended and Restated as of May 16, 2019) (incorporated by reference to Appendix A to Avon's Proxy Statement as filed on April 2, 2019).
10.3	Form of Performance Contingent Restricted Stock Unit Award Agreement under the Avon Products, Inc. 2016 Omnibus Incentive Plan (Amended and Restated as of May 16, 2019).
10.4	Form of Retention Restricted Stock Unit Award Agreement under the Avon Products, Inc. 2016 Omnibus Incentive Plan (Amended and Restated as of May 16, 2019).
10.5	Form of Restricted Stock Unit Award Agreement under the Avon Products, Inc. 2016 Omnibus Incentive Plan (Amended and Restated as of May 16, 2019).
10.6	Form of Stock Appreciation Right Certificate Agreement under the Avon Products, Inc. 2016 Omnibus Incentive Plan (Amended and Restated as of May 16, 2019).
10.7	Form of Stock Option Award Agreement under the Avon Products, Inc. 2016 Omnibus Incentive Plan (Amended and Restated as of May 16, 2019).
10.8	Restricted Stock Unit Award Agreement, effective May 1, 2019, between Avon Products, Inc. and Gustavo Arnal
10.9	Performance-Contingent Restricted Stock Unit Award Agreement, effective May 1, 2019, between Avon Products, Inc. and Gustavo Arnal
'10.10	Option Agreement, effective as of May 1, 2019, between Avon Products, Inc. and Gustavo Arnal
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101	The following materials formatted in Extensible Business Reporting Language (XBRL): (i) Consolidated Statements of Operations, (ii) Consolidated Statements of Comprehensive Loss, (iii) Consolidated Balance Sheets, (iv) Consolidated Statements of Cash Flows and (v) Notes to Consolidated Financial Statements

64

AVON PRODUCTS, INC.

SIGNATURE

Pursuant to the requirements 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 1, 2019	/s/ Laura Barbrook
		Laura Barbrook
		Vice President and Corporate
		Controller - Principal Accounting Officer
		Signed both on behalf of the
		registrant and as chief
		accounting officer.

65

EX-10.3

Exhibit 10.3

AVON PRODUCTS, INC.

2016 OMNIBUS INCENTIVE PLAN

PERFORMANCE CONTINGENT

RESTRICTED STOCK UNIT AWARD AGREEMENT

1.Grant of Performance Contingent Restricted Stock Unit Award. Pursuant to the provisions of its 2016 Omnibus Incentive Plan (as amended and restated from time to time, the “Plan”), Avon Products, Inc. (the “Company”) has awarded you (the “Grantee”) Performance Contingent Restricted Stock Units (the “PRSUs”), representing the right to receive, in the future, shares of Stock (the “Shares”) as set forth in the Grantee’s grant notification. The PRSUs are subject to the terms and conditions set forth below, as well as those terms and conditions set forth in the Plan, all of which are hereby incorporated by this reference. All capitalized terms used in this Performance Contingent Restricted Stock Unit Award Agreement (this “Agreement”) shall have the meaning set forth in the Plan unless otherwise defined herein.

2.Nature of PRSUs; Issuance of Shares.

The PRSUs represent a right to receive Shares on the Settlement Date (as defined below) but do not represent a current interest in the Shares. If all the terms and conditions hereof and of the Plan are met, then the Grantee shall be issued Shares on the Settlement Date. Notwithstanding the foregoing or anything in this Agreement to the contrary, the Company reserves the right to determine to settle all or a portion of the Grantee’s vested PRSUs in cash, in lieu of Shares. Any such cash payment to the Grantee will equal (x) the Fair Market Value of a Share as of the Settlement Date multiplied by (y) the number of vested PRSUs the Company determines to settle in cash. Notwithstanding anything in this Agreement to the contrary, in the event the number of Shares that would be delivered upon settlement of the PRSUs would exceed the maximum number of Shares that may be made subject to an Award under the Plan, the amount in excess of the limit shall be settled in cash equal to the Fair Market Value of such excess Shares, determined as of the Settlement Date. Such cash payment shall be subject to any applicable limits on cash awards and other requirements of the Plan (or any successor thereto).

The Grantee should be aware that vesting of the PRSUs will, to the extent settled in Shares, result in the ownership of Shares and will require the Grantee to open and use a U.S. brokerage account. The Grantee will personally be responsible for any local compliance requirements in relation to all of the above transactions. These requirements may change from time to time, and the Company cannot guarantee that the Grantee will be able to receive Shares on the Settlement Date. Moreover, the Company is not liable for any decrease of value of the Shares.

3.Restrictions on Transfer of PRSUs. The PRSUs may not be sold, tendered, assigned, transferred, pledged or otherwise encumbered.

Exhibit 10.3

4.Vesting of PRSUs; Voting; Dividends and Dividend Equivalents.

(a)Subject to Section 5, vesting of the PRSUs shall occur on the date set forth in the Grantee’s grant notification (such date the “Vesting Date”), and settlement shall occur on the date set forth in the Grantee’s grant notification (such date, the “Settlement Date”) (which shall be no later than 60 days after the Vesting Date). Subject to Section 5, vesting and settlement are contingent upon: (i) the Grantee being employed by the Company or any of its Subsidiaries on the Vesting Date; and (ii) satisfaction by the Company of performance measures set forth in the Grantee’s grant notification (the “Performance Measures”), as determined by the Committee.

(b)The Grantee does not have the right to vote any of the Shares underlying the PRSUs or to receive dividends or Dividend Equivalents on or with respect to the Shares prior to the date such Shares are issued to the Grantee pursuant to the terms hereof.

5.Separation from Service.

(a)Separation from Service by the Company without Cause. If the Grantee incurs an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause on or after January 1 of the year following the date of grant (the “Grant Date”) and the Grantee has not attained Retirement (for all purposes under this Agreement, as such term is defined under the Plan as of the date hereof) and will not be eligible for Retirement at the end of the salary continuation period for which the Grantee is eligible under a severance pay plan of the Company or any Subsidiary or some other agreement between the Grantee and the Company or any Subsidiary (as if the Grantee made any available election under such plan or agreement to extend the salary continuation period by the maximum period available to such Grantee), in either case as in effect on the date hereof (disregarding any actual election made by the Grantee under such plan or agreement), then, provided that the Company has satisfied the Performance Measures as of the Vesting Date, a pro-rata portion of the PRSUs awarded hereunder shall become vested and such pro-rata portion of PRSUs shall be settled in the form of Shares issued to the Grantee on the Settlement Date. The number of PRSUs that vest shall be determined by multiplying the number of Shares subject to the PRSUs that are actually earned based on achievement of the applicable Performance Measures by a fraction, the numerator of which shall be the number of completed months of the Grantee’s employment from the Grant Date to the date of the Grantee’s Separation from Service (typically the last day of active employment), and the denominator of which shall be the total number of months from the Grant Date to the Vesting Date.

(b)Separation from Service Due to Retirement. If the Grantee incurs a voluntary Separation from Service due to Retirement on or after January 1 of the year following the Grant Date, or the Grantee incurs an involuntary Separation from Service by the Company (and, if applicable by any Subsidiary by whom the Grantee is employed) other than for Cause on or after January 1 of the year following the Grant Date, and the Grantee is or will be eligible for Retirement at the end of the salary continuation period for which the Grantee is eligible under a severance pay plan of the Company or any Subsidiary or some other agreement between the Grantee and the Company or any Subsidiary (as if the Grantee made any available election under such plan or agreement to extend the salary continuation period by the maximum period available to such Grantee), in either case as in effect on the date hereof (disregarding any actual election made by the Grantee under such plan or agreement), then, provided that the Company has satisfied the Performance Measures as of the Vesting Date, a pro-rata portion of the PRSUs awarded hereunder shall become vested and such pro-rata portion of PRSUs shall be issued to the Grantee on the Settlement Date. The number of PRSUs that vest shall be determined by multiplying the number of Shares subject to the PRSUs that are actually earned based on achievement of the applicable Performance Measures by a fraction, the numerator of which shall be the number of completed months of the Grantee’s employment

Exhibit 10.3

from the Grant Date to the date of the Grantee’s Separation from Service (typically the last day of active employment), and the denominator of which shall be the total number of months from the Grant Date to the Vesting Date.

(c)Separation from Service Due to Disability. If the Grantee incurs a Separation from Service due to Disability, then, provided that the Company has satisfied the Performance Measures as of the Vesting Date, a pro-rata portion of the PRSUs awarded hereunder shall become vested and such pro-rata portion of PRSUs shall be issued to the Grantee on the Settlement Date. The number of PRSUs that vest shall be determined by multiplying the number of Shares subject to the PRSUs that are actually earned based on achievement of the applicable Performance Measures by a fraction, the numerator of which shall be the number of completed months of the Grantee’s employment from the Grant Date to the date of the Grantee’s Separation from Service (typically the last day of active employment), and the denominator of which shall be the total number of months from the Grant Date to the Vesting Date.

(d)Death. If the Grantee dies before otherwise incurring a Separation from Service, then, provided that the Company has satisfied the Performance Measures as of the Vesting Date, a pro-rata portion of the PRSUs awarded hereunder shall become vested and such pro-rata portion of PRSUs shall be issued to the Grantee on the Settlement Date. The number of PRSUs that vest shall be determined by multiplying the number of Shares subject to the PRSUs that are actually earned based on achievement of the applicable Performance Measures by a fraction, the numerator of which shall be the number of completed months of the Grantee’s employment from the Grant Date to the date of the Grantee’s Separation from Service (typically the last day of active employment), and the denominator of which shall be the total number of months from the Grant Date to the Vesting Date.

(e)Separations from Service Causing Forfeiture. All PRSUs are forfeited if the Grantee incurs a Separation from Service from the Company (and, if applicable, from any Subsidiary by whom the Grantee is employed) under any of the following conditions: (i) an involuntary Separation from Service by the Company or any Subsidiary for Cause prior to the Settlement Date; (ii) an involuntary Separation from Service by the Company or any Subsidiary other than for Cause prior to January 1 of the year following the Grant Date; (iii) a voluntary Separation from Service due to Retirement prior to January 1 of the year following the Grant Date; or (iv) a voluntary Separation from Service (excluding Retirement or Disability) at any time prior to the Vesting Date, provided that to the extent the Grantee provides notice of his or her voluntary Separation from Service the PRSUs shall be forfeited as of the date that such notice is given.

(f)Change in Control. Notwithstanding any other provision of this Agreement, in the event of a Change in Control, the vesting and settlement of the PRSUs shall be governed by the provisions of the Plan regarding a Change in Control, which are incorporated herein by reference.

(g)Paid or Unpaid Leave of Absence or Change in Subsidiary Status for Subsidiary Employing Grantee. For purposes of determining the vesting of PRSUs under this Agreement, a paid or unpaid leave of absence of the Grantee that has been approved by the Company shall not constitute a Separation from Service of the Grantee, except to the extent that such leave of absence constitutes a “separation from service” (as defined in U.S. Internal Revenue Code Section 409A (“Section 409A”)). During such paid or unpaid leave of absence, until a “separation from service” occurs, the PRSUs shall continue to vest as set forth in this Agreement and the Grantee’s grant notification. For the avoidance of doubt, vesting of PRSUs under this Agreement during any notice period relating to any termination of the Grantee’s employment by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause is determined under Section 8(j) of this Agreement. For purposes of determining the vesting of PRSUs under this Agreement, the Grantee’s employment by a Subsidiary shall

Exhibit 10.3

be considered a Separation from Service on the date on which such Subsidiary ceases to be a Subsidiary, provided that, in such event, any issuance of Shares or amount payable in respect of the PRSUs to the Grantee pursuant to this Agreement shall be made on the Settlement Date.

(h)Six-Month Wait under U.S. Internal Revenue Code Section 409A. If (i) any payment hereunder is a non-exempt amount payable under a “nonqualified deferred compensation plan” (as defined in Section 409A) upon a Separation from Service (other than death) and (ii) the Grantee is a “specified employee” (as that term is defined in Section 409A) and pursuant to procedures established by the Company) on the Grantee’s Separation from Service, then any Shares or cash payable pursuant to the PRSU on account of the Grantee’s Separation from Service (other than death) will not be paid to the Grantee during the six-month period immediately following such Separation from Service. Instead, the Shares or cash that would have been payable to the Grantee on account of the Grantee’s Separation from Service shall be paid no earlier than the later of (i) the first day of the seventh month following the Grantee’s Separation from Service and (ii) the Settlement Date.

6.Non-Competition/Non-Solicitation/Non-Disclosure.

The Grantee agrees that, during the Grantee’s employment, beginning on the Grant Date, and for a period of one year after the Grantee’s Separation from Service with the Company (and, if applicable, a Subsidiary) for any reason whatsoever (including, but not limited to with or without Cause, Retirement or Disability), he or she shall not, without the prior written consent of the Committee, engage in any of the following activities:

(a)directly or indirectly engage or otherwise participate in any business which is competitive with any significant business of the Company or any Subsidiary, including without limitation, the Grantee’s acceptance of employment with, entrance into a consulting or advisory arrangement with, rendering services to or otherwise facilitating the business of Amway Corp./Alticor Inc., Amore Pacific, Arabela, Arbonne, Beiersdorf (Nivea), COTY, De Millus S.A., Ebel Int’l/Belcorp Corp., Elizabeth Arden, Faberlic, Herbalife Ltd., Inter Parfums, Jequiti, Lady Racine/LR Health & Beauty Systems GmbH, LG Health & Household, L’Occitane, L’Oréal Group/Cosmair Inc., Mary Kay Inc., Mistine/Better Way (Thailand) Co. Ltd., Natura Cosmetics S.A., Neways Int’l, NuSkin Enterprises Inc., O Boticário, Oriflame Cosmetics S.A., Origami Owl, Reckitt Benckiser PLC, Revlon Inc., Rodan & Fields, Shaklee Corp., Shiseido, Stella & Dot, Silpada, The Body Shop Int’l PLC, The Estée Lauder Companies Inc., The Procter & Gamble Company, Tupperware Corp., Unilever Group (N.V. and PLC), Vorwerk & Co. KG/Jafra Worldwide Holdings (Lux) S.à.R.L. Inc., Yanbal Int’l (Yanbal, Unique), Younique or any of their affiliates; or

(b)solicit or aid in the solicitation of any employees of the Company or any Subsidiary to leave their employment.

In addition, the Grantee shall not, unless compelled pursuant to an order of a court or other body having jurisdiction over such matter, communicate or divulge any secret or confidential information, knowledge or data, including without limitation any trade secrets, relating to the Company or a Subsidiary, and their respective businesses, obtained by the Grantee during his or her employment by the Company or a Subsidiary and which is not otherwise publicly known (other than by reason of an unauthorized act by the Grantee), to anyone other than the Company and those designated by it.

In the event the Company determines that the Grantee has breached any term of this Section 6 or any non-disclosure, non-compete or non-solicitation covenant set forth in his or her severance, employment or similar contract or any Company policy, then in addition to any other remedies the

Exhibit 10.3

Company may have available to it, unless otherwise determined by the Committee: (i) all unvested PRSUs granted hereunder shall be forfeited; (ii) all vested but not yet settled PRSUs hereunder shall be forfeited; (iii) if Shares have been issued to the Grantee in respect of all or a portion of the vested PRSUs hereunder, then the Grantee shall forfeit all such Shares so issued to the Grantee hereunder; and (iv) if cash has been paid to the Grantee in lieu of Shares in respect of all or a portion of the PRSUs hereunder, then the Grantee shall pay to the Company all such cash so paid; provided, however, that if the Grantee no longer holds Shares issued to the Grantee hereunder, then, the Grantee shall pay to the Company in cash the Fair Market Value of the Shares issued to the Grantee hereunder, determined as of the date of such issuance.

Notwithstanding anything in this Section 6 to the contrary, this Agreement is not intended to, and shall be interpreted in a manner that does not, limit or restrict the Grantee from exercising any legally protected whistleblower rights (including pursuant to Rule 21F under the U.S. Securities Exchange Act of 1934).

7.Recoupment.Except where void by law and unless otherwise determined by the Company, the PRSUs, and any Shares or cash issued upon settlement of any vested PRSUs, are subject to forfeiture and/or recoupment in the event that a Grantee has engaged in misconduct, including: (x) a serious violation of the Company’s Code of Conduct; or (y) a violation of law within the scope of employment with the Company and its Subsidiaries. All PRSUs hereunder are also subject to the Company’s Compensation Recoupment Policy.

8.Service Acknowledgments.

The Grantee acknowledges and agrees as follows:

(a)The execution and delivery of this Agreement and the granting of the PRSUs hereunder shall not constitute or be evidence of any agreement or understanding, express or implied, on the part of the Company or its Subsidiaries to employ the Grantee for any specific period.

(b)The award of the PRSUs hereunder is voluntary and occasional and does not entitle the Grantee to any benefit other than that specifically granted under this Agreement and under the Plan, or to any future grants or other benefits under the Plan or any similar plan, even if PRSUs have ever been granted in the past or have repeatedly been granted in the past. Any benefits granted under this Agreement and under the Plan are extraordinary and not part of the Grantee’s ordinary or expected compensation or salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, end-of-service payments, bonuses, long-service awards, pension, welfare or retirement benefits or similar payments and in no event should be considered as compensation for, or relating in any way to, past services for the Company or any of its Subsidiaries. The Grantee understands and accepts that the benefits granted under the Plan are entirely at the grace and discretion of the Company and that the Company retains the right to amend or terminate the Plan, and/or the Grantee’s participation therein, at any time, at the Company’s sole discretion and without notice, subject to applicable law and the terms of the Plan.

(c)Nothing in this Agreement shall confer upon the Grantee any right to continue in the service of the Company or a Subsidiary or interfere in any way with any right of the Company or a Subsidiary to terminate the employment of the Grantee at any time, subject to applicable law.

(d)The Grantee is participating in the Plan, accepting the PRSUs and entering into this Agreement voluntarily.

Exhibit 10.3

(e)The Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, to the extent permitted by the Plan.

(f)All decisions with respect to future PRSUs or other grants, if any, will be at the sole discretion of the Company.

(g)The future value of the underlying Shares is unknown, indeterminable and cannot be predicted with certainty. The value of the Shares may increase or decrease.

(h)Neither the Company nor any Subsidiary is providing any tax, legal or financial advice or making any recommendations regarding this award, the Grantee’s participation in the Plan, or the Grantee’s acquisition or sale of the Shares.

(i)In consideration of the grant of the PRSUs, (i) the Grantee shall have no claim or entitlement to compensation or damages arising from (x) forfeiture of the PRSUs resulting from termination of the Grantee’s service (for any reason whether or not in breach of local law) or otherwise pursuant to this Agreement or (y) diminution in value of the PRSUs or Shares underlying the PRSUs and (ii) the Grantee irrevocably releases the Company and its Subsidiaries from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by accepting the PRSUs, the Grantee shall be deemed irrevocably to have waived the Grantee’s entitlement to pursue such a claim.

(j)Any notice period mandated under applicable law or otherwise arising in connection with an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause shall be treated as service for the purpose of determining the vesting of the PRSUs. However, any notice period mandated under applicable law or otherwise for which the Grantee receives pay in lieu of such notice shall not be treated as service for purposes of determining the vesting of the PRSUs, and the Grantee’s right to the vesting of Shares in settlement of the PRSUs after termination of service, if any, will be measured by the date of termination of the Grantee’s active service and will not be extended by any such notice period. Similarly, if the Company elects to place the Grantee on garden leave (or the equivalent) during any notice period arising in connection with an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause, such garden leave period shall not be treated as service for the purpose of determining the vesting of the PRSUs, and the Grantee’s right to settlement of the PRSUs after termination of service, if any, will be measured by the date of termination of the Grantee’s active service (i.e., the commencement of such leave) and will not be extended by any such leave. Subject to the foregoing and the provisions of the Plan, the Company, in its sole discretion, shall determine whether the Grantee’s service has terminated and the effective date of such termination.

(k)The grant of PRSUs will not be interpreted to form an employment contract or employment relationship with the Company or any of its Subsidiaries that does not otherwise exist.

9.Data Privacy Acknowledgment and Consent.

By signing thisAgreement, the Grantee acknowledges and agrees that in order to implement, manage and administer this award and the Grantee’s participation in the Plan, and/or in connection with tax or other governmental and regulatory compliance activities directly or indirectly related to the PRSUs, the Company and/or an entity belonging to the Company’s group of companies (including the Grantee’s employer) may need to process the Grantee’s personal data (electronically or otherwise), including, but

Exhibit 10.3

not limited to, the Grantee’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any Shares or other equity securities, directorships held in the Company, details of all PRSUs or any other entitlements awarded, canceled, vested, unvested or outstanding in the Grantee’s favor (the “Personal Data”). The transfer of Personal Data to and collection by third-party service providers outside the Company’s group of companies, such as the Company’s authorized agent, may also be necessary in order to implement, manage and administer this award and the Plan.

The Grantee expressly and unambiguously consents to the collection, use and other processing of Personal Data by the Company, entities belonging to the Company’s group of companies, and third-party service providers. The Grantee understands that Company may transfer Grantee’s Personal Data to the United States, or other countries which may have a different or lower level of data protection law than the Grantee’s home country and which are not considered by the European Commission or the United Kingdom (should the United Kingdom cease to be a member of the European Economic Area (the “EEA”)) (if the Grantee is a resident of the United Kingdom or the EEA) or the data protection agencies of other jurisdictions to have data protection laws equivalent to the laws in Grantee’s country. The Company will therefore maintain an EU-US Privacy Shield certification or enter into an alternate data processing and transfer arrangement authorized by applicable law, such as Standard Contractual Clauses, to protect the Grantee’s Personal Data consistent with data protection laws of the European Union or the United Kingdom (should the United Kingdom cease to be a member of the EEA).

In addition, the Grantee expressly and unambiguously consents to the disclosure of Personal Data to, and processing by, a third party in the event of any potential or actual reorganization, merger, sale, joint venture, assignment, transfer or other disposition of all or any portion of the Company’s business, assets or stock (including in connection with any bankruptcy or similar proceedings); and as the Company believes necessary or appropriate: (a) under applicable law, including laws outside of Grantee’s country; (b) to comply with legal processes; and (c) to respond to requests from public and government authorities including public and government authorities outside of Grantee’s country.

The Grantee authorizes the recipients to receive, possess, use, retain and transfer the Personal Data, in electronic or other form, for the purposes of implementing, managing and administering this award and the Grantee’s participation in the Plan, including any requisite transfer of such Personal Data as may be required to a broker or other third party with whom the Grantee may elect to deposit any Shares acquired upon settlement of the PRSUs. The Grantee understands that Personal Data will be held only as long as is necessary to implement, manage and administer this award and the Grantee’s participation in the Plan, unless a longer retention period is required by applicable laws, regulations, rules or valid requests or orders of a court or other dispute resolution forums or of a governmental or public authority, in each case, including those of a court or other dispute resolution forums or of a governmental or public authority outside of Grantee’s country. The Grantee understands that he or she may, at any time, view his or her Personal Data, request additional information about the storage and processing of his or her Personal Data, require any necessary amendments to his or her Personal Data that is incorrect or refuse or withdraw the consents herein, in any case without cost, by contacting in writing the Grantee’s local stock program coordinator.

If Grantee does not consent, or if Grantee later seeks to revoke Grantee’s consent, Grantee’s employment status or career with the Company or Subsidiary will not be adversely affected; the only adverse consequence of refusing or withdrawing Grantee’s consent is that the Company would not be able to grant PRSUs under the Plan or other equity awards, or manage or administer such awards. Therefore, Grantee understands that refusing or withdrawing Grantee’s consent may affect Grantee’s ability to participate in the Plan. For more information on the consequences of the Grantee’s refusal to consent or

Exhibit 10.3

withdrawal of consent, the Grantee understands that he or she may contact the Grantee’s local stock program coordinator.

If the Grantee is a resident of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA), his or her Personal Data will not be processed on the basis of consent (unless the Grantee provides a specific consent separate from this Section 9), but will be processed where necessary to fulfil the Company’s contractual obligations with the Grantee, where necessary to comply with the Company’s legal obligations under any applicable laws, or to meet the Company’s legitimate business interests. The Company has a legitimate interest in managing its business appropriately including incentivizing its employees, complying with its legal and contractual obligations, and keeping its records accurate and up to date. Grantees who are residents of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA) should refer to the Privacy Statement for Associates issued by his or her employer for additional information about the processing of the Grantee’s Personal Data and his or her privacy rights. The Privacy Statement for Associates will govern the processing of the Grantee’s Personal Data in connection with the administration of this award and the Grantee’s participation in the Plan.

The Company will take reasonable measures to keep the Personal Data private, confidential and accurate. The Grantee may obtain details with respect to the collection use, processing and transfer of his/her Personal Data in relation to Plan participation and may also request a list with names and addresses of potential recipients of the Data and/or access to and updates of such Personal Data, if needed, by contacting his or her local stock program coordinator.

10.Responsibility for Taxes.

By accepting this grant, the Grantee hereby irrevocably elects to satisfy any taxes and social insurance contribution withholding required to be withheld by the Company or its Subsidiaries on the date of grant or vesting of the PRSUs or the date of delivery or sale of any Shares hereunder or on any earlier date on which such taxes or social insurance contribution withholding may be due (“Tax Liability”) by authorizing the Company or any of its Subsidiaries to withhold a sufficient number of Shares that would otherwise be deliverable to the Grantee upon settlement of the PRSUs (or, if the PRSUs are settled in cash in lieu of Shares, an amount of cash sufficient to satisfy the Tax Liability). If, for any reason, the Shares or cash that would otherwise be deliverable to the Grantee upon settlement of the PRSUs would be insufficient to satisfy the Tax Liability, the Company and any of its Subsidiaries are authorized to withhold an amount from the Grantee’s wages or other compensation sufficient to satisfy the Tax Liability. Furthermore, the Grantee agrees to pay the Company or its Subsidiaries any amount of the Tax Liability that cannot be satisfied through one of the foregoing methods.

Notwithstanding the foregoing, if, on the applicable Settlement Date or on any earlier date on which the Tax Liability may be due, the delivery of Shares is not made for any reason (including pursuant to a deferral election made by the Grantee under the Company’s Deferred Compensation Plan, if applicable), the Grantee hereby irrevocably elects to satisfy such Tax Liability by delivering cash to the Company in an amount sufficient to satisfy such Tax Liability.

Apart from any withholding obligations that may apply to the Company and/or its Subsidiaries, the Grantee acknowledges and agrees that the ultimate responsibility for the Tax Liability is and remains with the Grantee. The Grantee further acknowledges that: (x) the Company and its Subsidiaries make no representations or undertakings regarding the Tax Liability; (y) the Company and its Subsidiaries do not commit to structure the terms of the grant or any other aspect of the PRSUs to reduce or eliminate the Tax Liability; and (z) the Grantee should consult a tax adviser regarding the Tax Liability.

Exhibit 10.3

The Grantee acknowledges that he or she may not participate in the Plan and the Company and its Subsidiaries shall have no obligation to deliver Shares until the Tax Liability has been fully satisfied by the Grantee.

11.U.S. Internal Revenue Code Section 409A. To the extent the Grantee is subject to Section 409A, any provision, application or interpretation of this Agreement that is inconsistent with Section 409A shall be disregarded. In no event shall the Company, any of its affiliates, any of its agents, or any member of the Board have any liability for any taxes, interest or penalties imposed in connection with a failure of the Plan to comply with Section 409A.

12.Notice. Any notice required to be given hereunder to the Grantee shall be addressed to the Grantee at his or her current address shown on the Company’s records. Notice shall be sent by mail, express delivery or, if practical, by electronic delivery or hand delivery.

13.Provisions Inconsistent with Translation. To the extent that the Grantee has been provided with a translation of this Agreement, the English language version of this Agreement shall prevail in case of any discrepancies or ambiguities due to translation.

14. Acknowledgment. The Company and the Grantee agree that the PRSUs are granted under, and governed by, the Grantee’s grant notification, this Agreement and the Plan. The Grantee: (x) acknowledges receipt of a copy of such grant notification, this Agreement, the Plan and the prospectus relating to the Plan; (y) represents that the Grantee has carefully read and is familiar with their provisions; and (z) hereby accepts the PRSUs subject to all of the terms and conditions set forth in the Grantee’s grant notification, this Agreement and the Plan.

15.Compliance with Laws and Regulations. The granting of the PRSUs and the delivery of Shares hereunder shall be subject to all applicable laws, rules and regulations. The issuance of Shares will be subject to and conditioned upon compliance by the Company and its Subsidiaries and the Grantee with all applicable laws and regulations and with all applicable requirements of any stock exchange or automated quotation system on which the Shares may be listed or quoted at the time of such issuance or transfer. If any provision of this Agreement conflicts with applicable mandatory law, the provisions of such law shall govern.

16.Additional Conditions to Issuance of Shares. If at any time the Company determines, in its discretion, that as a condition to the issuance of Shares to the Grantee (or the Grantee’s estate) hereunder, it is necessary or desirable to (i) list, register, qualify or comply with the rules of any securities exchange, (ii) qualify or comply with any applicable state, federal or foreign law, including the applicable tax code and related regulations, or (iii) obtain the consent or approval of any governmental regulatory authority or securities exchange, then such issuance will not occur unless and until such listing, registration, qualification, rule compliance, consent or approval is completed, effected or obtained free of any conditions not acceptable to the Company. Where the Company determines that the delivery of Shares hereunder will violate federal securities laws or other applicable law, the Company will defer delivery until the earliest date on which the Company reasonably anticipates that the delivery of Shares hereunder will no longer cause such violation. The Company will make all reasonable efforts to meet the requirements of any such state, federal or foreign law or securities exchange and to obtain any such consent or approval of any such governmental authority or securities exchange.

17.Foreign Exchange. The Grantee acknowledges and agrees that it is the Grantee’s sole responsibility to investigate and comply with any applicable exchange control laws in connection with the issuance and delivery of the Shares pursuant to the vesting of the PRSUs and that the Grantee shall be

Exhibit 10.3

responsible for any reporting of inbound international fund transfers required under applicable law. The Grantee is advised to seek appropriate professional advice as to how the exchange control regulations apply to the Grantee’s specific situation. The Grantee acknowledges and agrees that neither the Company nor any Subsidiary shall be liable for any foreign exchange rate fluctuation between Grantee’s local currency and the United States Dollar that may affect the value of the PRSUs, or of any amounts due to Grantee pursuant to the settlement of the PRSUs or the subsequent sale of any Shares acquired upon settlement.

18.Miscellaneous. The Company at any time, and from time to time, may amend the terms of this Agreement; provided, however, that the rights of the Grantee shall not be materially adversely affected without the Grantee’s written consent (except to the extent permitted under the Plan). No waiver by either party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. All amounts credited in respect of the PRSUs to the book-entry account under this Agreement shall continue for all purposes to be part of the general assets of the Company. The Grantee’s interest in such account shall make the Grantee only a general, unsecured creditor of the Company. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, and each other provision of this Agreement shall be severable and enforceable to the extent permitted by law. In lieu of issuing a fraction of a Share resulting from an adjustment of the PRSUs pursuant to Section 9 of the Plan or otherwise, the Company shall be entitled to pay to the Grantee an amount equal to the Fair Market Value of such fractional Share. The terms of this Agreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and to the benefit of the Grantee and the Grantee’s beneficiaries, executors, administrators, heirs and successors. The headings of the Sections hereof are provided for convenience only and are not to serve as a basis for interpretation or construction, and shall not constitute a part, of this Agreement.

19.Entire Agreement. This Agreement (including Appendix A), the Plan and the Grantee’s grant notification contain the entire agreement and understanding of the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations and negotiations in respect thereto.

20.Applicable Law. This Agreement (including Appendix A), the Plan and the Grantee’s grant notification, and all actions taken hereunder or under the Plan, shall be governed by, and construed in accordance with, the laws of the State of New York without regard to the conflict of law principles thereof.

21.Electronic Delivery and Acceptance. The Company may, in its sole discretion, decide to deliver any documents related to the PRSUs or future PRSUs that may be awarded under the Plan by electronic means, or request the Grantee’s consent to participate in the Plan by electronic means. Such means of electronic delivery may include, but do not necessarily include, the delivery of a link to a Company intranet or the Internet site of a third party involved in administering this award or the Plan, the delivery of the document via electronic mail or such other means of electronic delivery specified by the Company. The Grantee consents to the electronic delivery of the Plan documents (including the prospectus relating to the Plan) and this Agreement. The Grantee acknowledges that he or she may receive from the Company a paper copy of any documents delivered electronically, at no cost to the Grantee, by contacting the Company by telephone or in writing. The Grantee further acknowledges that the Grantee will be provided with a paper copy of any documents if the attempted electronic delivery of such documents fails. Similarly, the Grantee understands that the Grantee must provide the Company or any designated third-party administrator with a paper copy of any documents if the attempted electronic delivery of such

Exhibit 10.3

documents fails. The Grantee may revoke his or her consent to the electronic delivery of documents or may change the electronic mail address to which such documents are to be delivered (if the Grantee has provided an electronic mail address), at any time by notifying the Company of such revoked consent or revised electronic mail address by telephone, postal service or electronic mail. Finally, the Grantee understands that he or she is not required to consent to electronic delivery of documents.

22.No Advice Regarding Grant. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations or assessments regarding Grantee’s acceptance of this award, participation in the Plan, or acquisition or sale of the underlying Shares. The Grantee is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her acceptance of this award and participation in the Plan before taking any action related to the Plan.

23.Counterparts. This Agreement may be executed in one or more counterparts (including via facsimile and electronic image scan (pdf)), each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument and shall become effective when one or more counterparts have been signed by each party and delivered to the other party.

24.Appendix. Notwithstanding any provisions in this Agreement, the PRSUs shall be subject to any special terms, conditions or notifications set forth in Appendix A to this Agreement for the Grantee’s country, which shall constitute part of this Agreement. Moreover, if the Grantee relocates to one of the countries included in Appendix A, the special terms and conditions for such country will apply to the Grantee, to the extent the Company determines that the application of such terms and conditions is necessary or advisable in order to comply with local law or facilitate the administration of the Plan.

[Signatures on Next Page]

IN WITNESS WHEREOF, the Company, by its duly authorized officer, and the Grantee have executed this Agreement as of the Grant Date.

By the Grantee’s acceptance of this Agreement, the Grantee and the Company agree that the PRSUs are granted under and governed by the terms and conditions of the Plan, the Grantee’s grant notification and this Agreement. The Grantee has reviewed the Plan, the Plan prospectus, the Grantee’s grant notification and this Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Agreement, and fully understands all provisions of the Plan, the Plan prospectus, the Grantee’s grant notification and this Agreement. The Grantee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions relating to the Plan, the Plan prospectus, the Grantee’s grant notification and this Agreement. The Grantee further agrees to notify the Company upon any change in Grantee’s residence address.

Exhibit 10.3

AVON PRODUCTS, INC. GRANTEE

Chief Executive Officer Name:

APPENDIX A

ADDITIONAL TERMS AND CONDITIONS OF

PERFORMANCE CONTINGENT RESTRICTED STOCK UNIT AWARD AGREEMENT UNDER THE

AVON PRODUCTS, INC. 2016 OMNIBUS INCENTIVE PLAN

NON-U.S. EMPLOYEES

This Appendix includes additional terms and conditions that govern the PRSUs granted to the Grantee under the Plan if the Grantee resides in one of the countries listed below. Capitalized terms used but not defined in this Appendix have the meanings set forth in the Plan and/or the Agreement.

The Grantee understands and agrees that the Company strongly recommends that the Grantee not rely on the information herein as the only source of information relating to the consequences of participation in the Plan because applicable rules and regulations regularly change, sometimes on a retroactive basis, and the information may be out of date at the time the PRSUs vest or the Shares underlying the PRSUs are issued.

In addition, the information contained herein is general in nature and may not apply to Grantee’s particular situation and the Company is not in a position to assure Grantee of any particular result. Accordingly, Grantee is advised to seek appropriate professional advice as to how the relevant laws of Grantee’s country may apply to his or her situation.

The Grantee further understands and agrees that if the Grantee is a citizen or resident of a country other than the one in which the Grantee is currently working, transfers employment after grant of the PRSUs, or is considered a resident of another country for local law purposes, the information contained herein may not apply to the Grantee, and the Company shall, in its discretion, determine to what extent the terms and conditions contained herein shall apply, or determine that other terms and conditions are necessary or advisable in order to comply with local law or to facilitate the administration of the Agreement.

Argentina

Securities Law Notice

Exhibit 10.3

The Grantee understands and agrees that neither the grant of the PRSUs nor the issuance of Shares constitute a public offering as defined under Argentine law. The offering of the PRSUs is a private placement. As such, the offering is not subject to the supervision of any Argentine governmental authority.

Exchange Control Information

The Grantee is solely responsible for complying with the exchange control rules that may apply to the Grantee in connection with his or her participation in the Plan and/or transfer of proceeds from the sale of Shares or receipt of dividends acquired under the Plan into Argentina. Prior to transferring funds into Argentina, the Grantee should consult his or her local bank and/or exchange control advisor to confirm what will be required by the bank because interpretations of the applicable Central Bank regulations vary by bank and exchange control rules and regulations are subject to change without notice.

Brazil

Compliance with Laws

By accepting the PRSUs, the Grantee agrees to comply with applicable Brazilian laws and to report and pay any and all applicable Tax Liability associated with the vesting of the PRSUs, the sale of the Shares acquired pursuant thereto and the receipt of any dividends. By accepting the PRSUs, the Grantee further agrees that, for all legal purposes: (i) the benefits provided under the Plan are the result of commercial transactions unrelated to the Grantee’s employment; (ii) the Plan is not a part of the terms and conditions of the Grantee’s employment; and (iii) the income from the PRSUs, if any, is not part of the Grantee’s remuneration from employment.

Report of Overseas Assets

If the Grantee is resident or domiciled in Brazil, the Grantee will be required to submit an annual declaration of assets and rights held outside of Brazil to the Central Bank of Brazil if the aggregate value of such assets and rights equals or exceeds US$100,000. Assets and rights that must be reported include, but are not limited to, the Shares acquired under the Plan.

Colombia

Foreign Exchange Notice

The Grantee understands and acknowledges that if the Grantee’s total overseas investments, including but not limited to any Shares acquired under the Plan, at any time exceeds US $500,000, the Grantee must register such investments with the Colombian Central Bank by June 30 of the following year.

Overseas Investment Registration

The Grantee understands and acknowledges that if the Grantee’s total overseas investments, including but not limited to any payment or Shares acquired pursuant to the Plan, at any time exceeds US $500,000, the Grantee is required to register such investments with the Colombian Central Bank by June 30 of the following year.

Germany

Exhibit 10.3

Exchange Control Information

If the Grantee remits proceeds in excess of €12,500 out of or into Germany, such cross-border payment must be reported monthly to the State Central Bank. In the event that the Grantee makes or receives a payment in excess of this amount, the Grantee is responsible for obtaining the appropriate form from a German bank and complying with applicable reporting requirements. In addition, the Grantee must report on an annual basis if the Grantee holds shares exceeding 10% of the total voting capital of the Company.

Securities Disclaimer

Participation in the Plan is exempt or excluded from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Germany.

Mexico

Employment and Labor Law Acknowledgments

As a condition of accepting the PRSUs, the Grantee acknowledges and agrees that: (i) the PRSUs are not related to the salary or any other contractual benefits provided to the Grantee by the Grantee’s employer; (ii) any modification of the Plan or its termination shall not constitute a change or impairment of the terms and conditions of the Grantee’s employment; (iii) the grant of the PRSUs is unilateral and discretionary and, therefore, the Company reserves the absolute right to amend it and discontinue it at any time without any liability to the Grantee; and (iv) neither the grant of the PRSUs nor the issuance of Shares in any way establishes a labor relationship between the Grantee and the Company, which is headquartered in the United States, or any additional rights between the Grantee and the Grantee’s employer, based in Mexico.

By accepting the PRSUs, the Grantee acknowledges that he or she has received a copy of the Plan, the Agreement and the Grantee’s grant notification, and has reviewed the Plan, the Agreement, including this Appendix, and the Grantee’s grant notification in their entirety, and fully understands and accepts all provisions thereof.

The Grantee acknowledges and confirms that the Grantee does not reserve any action or right to bring any claim against the Company or its Subsidiaries for any compensation or damages as a result of participation in the Plan and therefore grants a full and broad release to the Company and its Subsidiaries with respect to any claim that may arise under the Plan.

Compliance with Mexican Securities Laws

The Plan, the PRSUs and the Shares are exempt from affirmative registration requirements in Mexico because the rights to acquire Shares pursuant to the PRSUs and the Plan are limited to specified qualified employees in Mexico and communicated in a private and confidential manner.

Poland

Foreign Exchange Notice

The Grantee understands and acknowledges that the Grantee must notify the National Bank of Poland of the value of all foreign share ownership, including but not limited to Shares acquired under the Plan, if such ownership exceeds a designated threshold. If required, the reports are due on a quarterly basis by the 20th day following the end of each quarter. The reports are filed on special forms available on the website of the National Bank of Poland. In addition, the Grantee should maintain evidence of such foreign

Exhibit 10.3

exchange transactions for five years, in case of a request for their production by the National Bank of Poland. The Grantee is strongly encouraged to consult with an appropriate legal advisor regarding these requirements.

Securities Disclaimer

The grant of the PRSUs is exempt from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Poland.

Romania

Exchange Control Information

If the Grantee deposits the proceeds from the sale of Shares issued to the Grantee at purchase in a bank account in Romania, the Grantee may be required to provide the Romanian bank with appropriate documentation explaining the source of the funds. The Grantee should consult his or her personal advisor to determine whether the Grantee will be required to submit such documentation to the Romanian bank.

Securities Disclaimer

Participation in the Plan is exempt or excluded from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Romania.

Spain

Tax Reporting Obligation for Assets Held Abroad

Individuals in Spain are required to report assets and right located outside of Spain (which would include Shares or any funds held in a U.S. brokerage account) on Form 720 by March 31st after each calendar year. A report is not required if the value of assets held outside of Spain is EUR 50,000 or less or if the assets held outside of Spain have not increased by more than EUR 20,000 compared to the previous year (assuming that a prior report has been filed reporting these assets). The Grantee is encouraged to consult his or her personal tax advisor for more information on how to complete the report and the specific information on what types of assets are required to be reported.

Exchange Control Information

The Grantee must declare the acquisition of stock in a foreign company (including Shares acquired under the Plan) to the Dirección General de Política Comercial e Inversiones Exteriores (“DGPCIE”) of the Ministerio de Economia for statistical purposes. He or she must also declare ownership of any stock in a foreign company (including Shares acquired under the Plan) with the Directorate of Foreign Transactions each January while the stock is owned. In addition, if the Grantee wishes to import the share certificates into Spain, he or she must declare the importation of such securities to the DGPCIE.

When receiving foreign currency payments derived from the ownership of the Shares (i.e., dividends or sale proceeds), the Grantee must inform the financial institution receiving the payment of the basis upon which such payment is made. The Grantee will need to provide the following information: (i) his or her name, address, and fiscal identification number; (ii) the name and corporate domicile of the Company; (iii) the amount of the payment and the currency used; (iv) the country of origin; (v) the reasons for the payment; and (vi) any further information that may be required.

Exhibit 10.3

Securities Disclaimer

The grant of the PRSUs is exempt from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Spain.

Turkey

Securities Law Information

Under Turkish law, the Grantee is not permitted to sell Shares acquired under the Plan in Turkey. The Grantee must sell the Shares acquired under the Plan outside of Turkey. The Shares are currently traded on the New York Stock Exchange in the United States under the ticker symbol “AVP” and Shares may be sold on this exchange.

Exchange Control Information

Under Turkish exchange control regulations, the Grantee may be required to use a financial intermediary institution approved under the Turkish Capital Market Law to acquire or sell shares traded on a foreign market and to report such activity to the Capital Markets Board.  The Grantee should consult his or her personal advisor regarding these requirements.

United Kingdom

Tax and National Insurance Contributions

If the Company determines that it is required to account to HM Revenue & Customs for the Tax Liability and any Secondary NIC Liability or to withhold any other tax as a result of the PRSUs, the Grantee, as a condition to the vesting of the PRSUs, shall make arrangements satisfactory to the Company to enable it to satisfy all withholding liabilities. The Grantee shall also make arrangements satisfactory to the Company to enable it to satisfy any withholding requirements that may arise in connection with the vesting or disposition of Shares acquired pursuant to the PRSUs.

As a further condition of the vesting of the PRSUs under the Plan, the Grantee may at the Company’s discretion be directed to join with the Company, or if and to the extent that there is a change in the law, any of its Subsidiaries or person who is or becomes a Secondary Contributor in making a Joint Election which has been approved by HM Revenue & Customs, for the transfer of the whole Secondary NIC Liability.

To the extent permitted by law, the Grantee hereby agrees to indemnify and keep indemnified the Company and its Subsidiaries for any Tax Liability.

Securities Disclosure

Neither the Agreement nor this Appendix is an approved prospectus for the purposes of section 85(1) of the Financial Services and Markets Act 2000 (“FSMA”) and no offer of transferable securities to the public (for the purposes of section 102B of FSMA) is being made in connection with the Plan. The Plan and the PRSUs are exclusively available in the UK to bona fide employees and former employees of the Company and any UK Subsidiary.

****

End of the Appendix

EX-10.4

Exhibit 10.4

AVON PRODUCTS, INC.

2016 OMNIBUS INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

1.Grant of Restricted Stock Unit Award. Pursuant to the provisions of its 2016 Omnibus Incentive Plan (as amended and restated from time to time, the “Plan”), Avon Products, Inc. (the “Company”) has awarded you (the “Grantee”) Restricted Stock Units (the “RSUs”), representing the right to receive, in the future, shares of Stock (the “Shares”) as set forth in the Grantee’s grant notification. The RSUs are subject to the terms and conditions set forth below, as well as those terms and conditions set forth in the Plan, all of which are hereby incorporated by this reference. All capitalized terms used in this Restricted Stock Unit Award Agreement (this “Agreement”) shall have the meaning set forth in the Plan, unless otherwise defined herein.

2.Nature of RSUs; Issuance of Shares.

The RSUs represent a right to receive Shares on the Vesting Date (as defined below) but do not represent a current interest in the Shares. If all the terms and conditions hereof and of the Plan are met, then the Grantee shall be issued Shares on the Vesting Date (or earlier vesting date as provided in this Agreement). Notwithstanding the foregoing or anything in this Agreement to the contrary, the Company reserves the right to determine to settle all or a portion of the Grantee’s vested RSUs in cash, in lieu of Shares. Any such cash payment to the Grantee will equal (x) the Fair Market Value of a Share as of the Vesting Date (or earlier vesting date as provided in this Agreement) multiplied by (y) the number of vested RSUs the Company determines to settle in cash.

The Grantee should be aware that vesting of the RSUs will, to the extent settled in Shares, result in the ownership of Shares and will require the Grantee to open and use a U.S. brokerage account. The Grantee will personally be responsible for any local compliance requirements in relation to all of the above transactions. These requirements may change from time to time, and the Company cannot guarantee that the Grantee will be able to receive Shares on the Vesting Date (or earlier vesting date as provided in this Agreement). Moreover, the Company is not liable for any decrease of value of the Shares.

3.Restrictions on Transfer of RSUs.The RSUs may not be sold, tendered, assigned, transferred, pledged or otherwise encumbered.

4.Vesting of RSUs; Voting; Dividends and Dividend Equivalents.

(a)Subject to Section 5, vesting and settlement of the RSUs shall occur on the date set forth in the Grantee’s grant notification (such date the “Vesting Date”). Subject to Section 5, vesting and settlement are contingent upon the Grantee being employed by the Company or any of its Subsidiaries on the Vesting Date.

Exhibit 10.4

(b)The Grantee does not have the right to vote any of the Shares underlying the RSUs or to receive dividends on them prior to the date such Shares are issued to the Grantee pursuant to the terms hereof. However, unless otherwise determined by the Committee, the Grantee will be credited with Dividend Equivalents with respect to the RSUs. Notwithstanding the foregoing, any such Dividend Equivalents will accumulate and be paid in cash once (and to the extent that) the RSUs vest and settle, provided that the Grantee remains employed by the Company or any Subsidiary through the date such Dividend Equivalents are paid.

5.Separation from Service.

(a)Involuntary Separation from Service by the Company Other Than For Cause. If the Grantee incurs an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause, then a pro-rata portion of the RSUs awarded hereunder shall become vested and such pro-rata portion of RSUs (less any previously vested and settled RSUs) shall be settled in the form of Shares issued to the Grantee within sixty (60) days after such Separation from Service. The number of RSUs that vest shall be determined by multiplying the total number of RSUs awarded hereunder by a fraction, the numerator of which shall be the number of completed months of the Grantee’s employment from the date of grant of the RSUs (the “Grant Date”) to the date of the Grantee’s Separation from Service (typically the last day of active employment), and the denominator of which shall be the total number of months from the Grant Date to the Vesting Date.

(b)Separation from Service due to Disability. If the Grantee incurs a Separation from Service due to Disability, then all of the RSUs awarded hereunder shall become vested and such vested Shares shall be issued to the Grantee within sixty (60) days after such Separation from Service.

(c)Death. If the Grantee dies before otherwise incurring a Separation from Service, then all of the RSUs awarded hereunder shall become vested and such vested Shares shall be issued to the Grantee’s designated beneficiary (or if none, the Grantee’s estate) within sixty (60) days after such death.

(d)Separations from Service Causing Forfeiture. All RSUs are forfeited if the Grantee incurs a Separation from Service from the Company (and, if applicable, from any Subsidiary by whom the Grantee is employed) under any of the following conditions: (i) an involuntary Separation from Service by the Company or any Subsidiary for Cause prior to the Vesting Date; or (ii) a voluntary Separation from Service (excluding Retirement or Disability) prior to the Vesting Date, provided that to the extent the Grantee provides notice of his or her voluntary Separation from Service the RSUs shall be forfeited as of the date that such notice is given.

(e)Change in Control. Notwithstanding any other provision of this Agreement, in the event of a Change in Control, the vesting and settlement of the RSUs shall be governed by the provisions of the Plan regarding a Change in Control, which are incorporated herein by reference.

(f)Paid or Unpaid Leave of Absence or Change in Subsidiary Status for Subsidiary Employing Grantee. For purposes of determining the vesting of RSUs under this Agreement, a paid or unpaid leave of absence of the Grantee that has been approved by the Company shall not constitute a Separation from Service of the Grantee, except to the extent that such leave of absence constitutes a “separation from service” (as defined in U.S. Internal Revenue Code Section 409A(“Section 409A”)). During such paid or unpaid leave of absence, until a “separation from service” occurs, the RSUs shall continue to vest as set forth in this Agreement and the Grantee’s grant notification. For the avoidance of doubt, vesting of RSUs under this Agreement during any notice period relating to any termination of the

Exhibit 10.4

Grantee’s employment by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause is determined under Section 8(j) of this Agreement. For purposes of determining the vesting of RSUs under this Agreement, the Grantee’s employment by a Subsidiary shall be considered a Separation from Service on the date on which such Subsidiary ceases to be a Subsidiary, provided that payment shall continue to be made in accordance with this Agreement.

(g) Six-Month Wait under U.S. Internal Revenue Code Section 409A. If (i) any payment hereunder is a non-exempt amount payable under a “nonqualified deferred compensation plan” (as defined in Section 409A) upon a Separation from Service (other than death), and (ii) the Grantee is a “specified employee” (as that term is defined in Section 409A and pursuant to procedures established by the Company) on the Grantee’s Separation from Service, then any Shares or cash payable pursuant to the RSUs on account of the Grantee’s Separation from Service (other than death) will not be paid to the Grantee during the six-month period immediately following such Separation from Service. Instead, the Shares or cash that would have been payable to the Grantee on account of the Grantee’s Separation from Service under this Agreement shall be paid no earlier than the first day of the seventh month following the Grantee’s Separation from Service.

6.Non-Competition/Non-Solicitation/Non-Disclosure.

The Grantee agrees that, during the Grantee’s employment, beginning on the Grant Date, and for a period of one year after the Grantee’s Separation from Service with the Company (and, if applicable, a Subsidiary) for any reason whatsoever (including, but not limited to, with or without Cause, Retirement or Disability), he or she shall not, without the prior written consent of the Committee, engage in any of the following activities:

(a)directly or indirectly engage or otherwise participate in any business which is competitive with any significant business of the Company or any Subsidiary, including without limitation, the Grantee’s acceptance of employment with, entrance into a consulting or advisory arrangement with, rendering services to or otherwise facilitating the business of Amway Corp./Alticor Inc., Amore Pacific, Arabela, Arbonne, Beiersdorf (Nivea), COTY, De Millus S.A., Ebel Int’l/Belcorp Corp., Elizabeth Arden, Faberlic, Herbalife Ltd., Inter Parfums, Jequiti, Lady Racine/LR Health & Beauty Systems GmbH, LG Health & Household, L’Occitane, L’Oréal Group/Cosmair Inc., Mary Kay Inc., Mistine/Better Way (Thailand) Co. Ltd., Natura Cosmetics S.A., Neways Int’l, NuSkin Enterprises Inc., O Boticário, Oriflame Cosmetics S.A., Origami Owl, Reckitt Benckiser PLC, Revlon Inc., Rodan & Fields, Shaklee Corp., Shiseido, Stella & Dot, Silpada, The Body Shop Int’l PLC, The Estée Lauder Companies Inc., The Procter & Gamble Company, Tupperware Corp., Unilever Group (N.V. and PLC), Vorwerk & Co. KG/Jafra Worldwide Holdings (Lux) S.à.R.L. Inc., Yanbal Int’l (Yanbal, Unique), Younique or any of their affiliates; or

(b)solicit or aid in the solicitation of any employees of the Company or any Subsidiary to leave their employment.

In addition, the Grantee shall not, unless compelled pursuant to an order of a court or other body having jurisdiction over such matter, communicate or divulge any secret or confidential information, knowledge or data, including without limitation any trade secrets, relating to the Company or a Subsidiary, and their respective businesses, obtained by the Grantee during his or her employment by the Company or a Subsidiary and which is not otherwise publicly known (other than by reason of an unauthorized act by the Grantee), to anyone other than the Company and those designated by it.

Exhibit 10.4

In the event the Company determines that the Grantee has breached any term of this Section 6 or any non-disclosure, non-compete or non-solicitation covenant set forth in his or her severance, employment or similar contract or any Company policy, then in addition to any other remedies the Company may have available to it, unless otherwise determined by the Committee: (i) all unvested RSUs granted hereunder shall be forfeited; (ii) if Shares have been issued to the Grantee in respect of vested RSUs hereunder, then the Grantee shall forfeit all such Shares so issued to the Grantee hereunder; and (iii) if cash has been paid to the Grantee in lieu of Shares in respect of all or a portion of the vested RSUs hereunder, then the Grantee shall pay to the Company all such cash so paid; provided, however, that if the Grantee no longer holds Shares issued to the Grantee hereunder, then, the Grantee shall pay to the Company in cash the Fair Market Value of the Shares issued to the Grantee hereunder, determined as of the date of such issuance.

Notwithstanding anything in this Section 6 to the contrary, this Agreement is not intended to, and shall be interpreted in a manner that does not, limit or restrict the Grantee from exercising any legally protected whistleblower rights (including pursuant to Rule 21F under the U.S. Securities Exchange Act of 1934).

7.Recoupment. Except where void by law and unless otherwise determined by the Company, the RSUs, and any Shares or cash issued upon settlement of any vested RSUs, are subject to forfeiture and/or recoupment in the event that a Grantee has engaged in misconduct, including: (x) a serious violation of the Company’s Code of Conduct; or (y) a violation of law within the scope of employment with the Company and its Subsidiaries. All RSUs hereunder are also subject to the Company’s Compensation Recoupment Policy.

8.Service Acknowledgments.

The Grantee acknowledges and agrees as follows:

(a)The execution and delivery of this Agreement and the granting of the RSUs hereunder shall not constitute or be evidence of any agreement or understanding, express or implied, on the part of the Company or its Subsidiaries to employ the Grantee for any specific period.

(b)The award of the RSUs hereunder is voluntary and occasional and does not entitle the Grantee to any benefit other than that specifically granted under this Agreement and under the Plan, or to any future grants or other benefits under the Plan or any similar plan, even if RSUs have ever been granted in the past or have repeatedly been granted in the past. Any benefits granted under this Agreement and under the Plan are extraordinary and not part of the Grantee’s ordinary or expectedcompensationor salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, end-of-service payments, bonuses, long-service awards, pension, welfare or retirement benefits or similar payments and in no event should be considered as compensation for, or relating in any way to, past services for the Company or any of its Subsidiaries. The Grantee understands and accepts that the benefits granted under the Plan are entirely at the grace and discretion of the Company and that the Company retains the right to amend or terminate the Plan, and/or the Grantee’s participation therein, at any time, at the Company’s sole discretion and without notice, subject to applicable law and the terms of the Plan.

(c)Nothing in this Agreement shall confer upon the Grantee any right to continue in the service of the Company or a Subsidiary or interfere in any way with any right of the Company or a Subsidiary to terminate the employment of the Grantee at any time, subject to applicable law.

Exhibit 10.4

(d)The Grantee is participating in the Plan, accepting the RSUs and entering into this Agreement voluntarily.

(e)The Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, to the extent permitted by the Plan.

(f)All decisions with respect to future RSUs or other grants, if any, will be at the sole discretion of the Company.

(g)The future value of the underlying Shares is unknown, indeterminable and cannot be predicted with certainty. The value of the Shares may increase or decrease.

(h)Neither the Company nor any Subsidiary is providing any tax, legal or financial advice or making any recommendations regarding this award, or the Grantee’s participation in the Plan, or the Grantee’s acquisition or sale of the Shares.

(i)In consideration of the grant of the RSUs, (i) the Grantee shall have no claim or entitlement to compensation or damages arising from (x) forfeiture of the RSUs resulting from termination of the Grantee’s service (for any reason whether or not in breach of local law) or otherwise pursuant to this Agreement or (y) diminution in value of the RSUs or Shares underlying the RSUs and (ii) the Grantee irrevocably releases the Company and its Subsidiaries from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by accepting the RSUs, the Grantee shall be deemed irrevocably to have waived the Grantee’s entitlement to pursue such a claim.

(j)Any notice period mandated under applicable law or otherwise arising in connection with an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause shall be treated as service for the purpose of determining the vesting of the RSUs. However, any such notice period mandated under applicable law or otherwise for which the Grantee receives pay in lieu of such notice shall not be treated as service for purposes of determining the vesting of the RSUs, and the Grantee’s right to settlement of the RSUs after termination of service, if any, will be measured by the date of termination of the Grantee’s active service and will not be extended by any such notice period. Similarly, if the Company elects to place the Grantee on garden leave (or the equivalent) during any notice period arising in connection with an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause, such garden leave period shall not be treated as service for the purpose of determining the vesting of the RSUs, and the Grantee’s right to settlement of the RSUs after termination of service, if any, will be measured by the date of termination of the Grantee’s active service (i.e., the commencement of such leave) and will not be extended by any such leave. Subject to the foregoing and the provisions of the Plan, the Company, in its sole discretion, shall determine whether the Grantee’s service has terminated and the effective date of such termination.

(k)The grant of RSUs will not be interpreted to form an employment contract or employment relationship with the Company or any of its Subsidiaries that does not otherwise exist.

9.Data Privacy Acknowledgment and Consent.

By signing this Agreement, the Grantee acknowledges and agrees that in order to implement, manage and administer this award and the Grantee’s participation in the Plan, and/or in connection with

Exhibit 10.4

tax or other governmental and regulatory compliance activities directly or indirectly related to the RSUs, the Company and/or an entity belonging to the Company’s group of companies (including the Grantee’s employer) may need to process the Grantee’s personal data (electronically or otherwise), including, but not limited to, the Grantee’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any Shares or other equity securities, directorships held in the Company, details of all RSUs or any other entitlements awarded, canceled, vested, unvested or outstanding in the Grantee’s favor (the “Personal Data”). The transfer of Personal Data to and collection by third-party service providers outside the Company’s group of companies, such as the Company’s authorized agent, may also be necessary in order to implement, manage and administer this award and the Plan.

The Grantee expressly and unambiguously consents to the collection, use and other processing of Personal Data by the Company, entities belonging to the Company’s group of companies, and third-party service providers. The Grantee understands that Company may transfer Grantee’s Personal Data to the United States, or other countries which may have a different or lower level of data protection law than the Grantee’s home country and which are not considered by the European Commission or the United Kingdom (should the United Kingdom cease to be a member of the European Economic Area (the “EEA”)) (if the Grantee is a resident of the United Kingdom or the EEA) or the data protection agencies of other jurisdictions to have data protection laws equivalent to the laws in Grantee’s country. The Company will therefore maintain an EU-US Privacy Shield certification or enter into an alternate data processing and transfer arrangement authorized by applicable law, such as Standard Contractual Clauses, to protect the Grantee’s Personal Data consistent with data protection laws of the European Union or the United Kingdom (should the United Kingdom cease to be a member of the EEA).

In addition, the Grantee expressly and unambiguously consents to the disclosure of Personal Data to, and processing by, a third party in the event of any potential or actual reorganization, merger, sale, joint venture, assignment, transfer or other disposition of all or any portion of the Company’s business, assets or stock (including in connection with any bankruptcy or similar proceedings); and as the Company believes necessary or appropriate: (a) under applicable law, including laws outside of Grantee’s country; (b) to comply with legal processes; and (c) to respond to requests from public and government authorities including public and government authorities outside of Grantee’s country.

The Grantee authorizes the recipients to receive, possess, use, retain and transfer the Personal Data, in electronic or other form, for the purposes of implementing, managing and administering this award and the Grantee’s participation in the Plan including any requisite transfer of such Personal Data as may be required to a broker or other third party with whom the Grantee may elect to deposit any Shares acquired upon settlement of the RSUs. The Grantee understands that Personal Data will be held only as long as is necessary to implement, manage and administer this award and the Grantee’s participation in the Plan, unless a longer retention period is required by applicablelaws, regulations, rules or valid requests or orders of a court or other dispute resolution forums or of a governmental or public authority, in each case, including those of a court or other dispute resolution forums or of a governmental or public authority outside of Grantee’s country.The Grantee understands that he or she may, at any time, view his or her Personal Data, request additional information about the storage and processing of his or her Personal Data, require any necessary amendments to his or her Personal Data that is incorrect or refuse or withdraw the consents herein, in any case without cost, by contacting in writing the Grantee’s local stock program coordinator.

If Grantee does not consent, or if Grantee later seeks to revoke Grantee’s consent, Grantee’s employment status or career with the Company or Subsidiary will not be adversely affected; the only adverse consequence of refusing or withdrawing Grantee’s consent is that the Company would

Exhibit 10.4

not be able to grant RSUs under the Plan or other equity awards, or manage or administer such awards. Therefore, Grantee understands that refusing or withdrawing Grantee’s consent may affect Grantee’s ability to participate in the Plan. For more information on the consequences of the Grantee’s refusal to consent or withdrawal of consent, the Grantee understands that he or she may contact the Grantee’s local stock program coordinator.

If the Grantee is a resident of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA), his or her Personal Data will not be processed on the basis of consent (unless the Grantee provides a specific consent separate from this Section 9), but will be processed where necessary to fulfil the Company’s contractual obligations with the Grantee, where necessary to comply with the Company’s legal obligations under any applicable laws, or to meet the Company’s legitimate business interests. The Company has a legitimate interest in managing its business appropriately including incentivizing its employees, complying with its legal and contractual obligations, and keeping its records accurate and up to date. Grantees who are residents of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA) should refer to the Privacy Statement for Associates issued by his or her employer for additional information about the processing of the Grantee’s Personal Data and his or her privacy rights. The Privacy Statement for Associates will govern the processing of the Grantee’s Personal Data in connection with the administration of this award and the Grantee’s participation in the Plan.

The Company will take reasonable measures to keep the Personal Data private, confidential and accurate. The Grantee may obtain details with respect to the collection, use, processing and transfer of his/her Personal Data in relation to Plan participation and may also request a list with names and addresses of potential recipients of the Data and/or access to and updates of such Personal Data, if needed, by contacting his or her local stock program coordinator.

10.Responsibility for Taxes.

By accepting this grant, the Grantee hereby irrevocably elects to satisfy any taxes and social insurance contribution withholding required to be withheld by the Company or its Subsidiaries on the date of grant or vesting of the RSUs or the date of delivery or sale of any Shares hereunder or on any earlier date on which such taxes or social insurance contribution withholding may be due (“Tax Liability”) by authorizing the Company or any of its Subsidiaries to withhold a sufficient number of Shares that would otherwise be deliverable to the Grantee upon settlement of the RSUs (or, if the RSUs are settled in cash in lieu of Shares, an amount of cash sufficient to satisfy the Tax Liability). If, for any reason, the Shares or cash that would otherwise be deliverable to the Grantee upon settlement of the RSUs would be insufficient to satisfy the Tax Liability, the Company and any of its Subsidiaries are authorized to withhold an amount from the Grantee’s wages or other compensation sufficient to satisfy the Tax Liability. Furthermore, the Grantee agrees to pay the Company or its Subsidiaries any amount of the Tax Liability that cannot be satisfied through one of the foregoing methods.

Notwithstanding the foregoing, if, on the applicable Settlement Date or on any earlier date on which the Tax Liability may be due, the delivery of Shares is not made for any reason (including pursuant to a deferral election made by the Grantee under the Company’s Deferred Compensation Plan, if applicable), the Grantee hereby irrevocably elects to satisfy such Tax Liability by delivering cash to the Company in an amount sufficient to satisfy such Tax Liability.

Apart from any withholding obligations that may apply to the Company and/or its Subsidiaries, the Grantee acknowledges and agrees that the ultimate responsibility for the Tax Liability is and remains with the Grantee. The Grantee further acknowledges that: (x) the Company and its Subsidiaries make no

Exhibit 10.4

representations or undertakings regarding the Tax Liability or the receipt of any dividends; (y) the Company and its Subsidiaries do not commit to structure the terms of the grant or any other aspect of the RSUs to reduce or eliminate the Tax Liability; and (z) the Grantee should consult a tax adviser regarding the Tax Liability.

The Grantee acknowledges that he or she may not participate in the Plan and the Company and its Subsidiaries shall have no obligation to deliver Shares until the Tax Liability has been fully satisfied by the Grantee.

11.U.S. Internal Revenue Code Section 409A. To the extent the Grantee is subject to Section 409A, any provision, application or interpretation of this Agreement that is inconsistent with Section 409A shall be disregarded. In no event shall the Company, any of its affiliates, any of its agents, or any member of the Board have any liability for any taxes, interest or penalties imposed in connection with a failure of the Plan to comply with Section 409A. If the Grantee is subject to Section 409A, this Agreement will be interpreted in a manner to comply with the requirements of Section 409A by conforming it with the provisions found in the model U.S. annual restricted stock unit agreement.

12.Notice. Any notice required to be given hereunder to the Grantee shall be addressed to the Grantee at his or her current address shown on the Company’s records. Notice shall be sent by mail, express delivery or, if practical, by electronic delivery or hand delivery.

13.Provisions Inconsistent with Translation. To the extent that the Grantee has been provided with a translation of this Agreement, the English language version of this Agreement shall prevail in case of any discrepancies or ambiguities due to translation.

14.Acknowledgment. The Company and the Grantee agree that the RSUs are granted under, and governed by, the Grantee’s grant notification, this Agreement and the Plan. The Grantee: (x) acknowledges receipt of a copy of such grant notification, this Agreement, the Plan and the prospectus relating to the Plan; (y) represents that the Grantee has carefully read and is familiar with their provisions; and (z) hereby accepts the RSUs subject to all of the terms and conditions set forth in the Grantee’s grant notification, this Agreement and the Plan.

15.Compliance with Laws and Regulations. The granting of the RSUs and the delivery of Shares hereunder shall be subject to all applicable laws, rules and regulations. The issuance of Shares will be subject to and conditioned upon compliance by the Company and its Subsidiaries and the Grantee with all applicable laws and regulations and with all applicable requirements of any stock exchange or automated quotation system on which the Shares may be listed or quoted at the time of such issuance or transfer. If any provision of this Agreement conflicts with applicable mandatory law, the provisions of such law shall govern.

16.Additional Conditions to Issuance of Shares or Settlement. If at any time the Company determines, in its discretion, that as a condition to the issuance of Shares to the Grantee (or the Grantee’s estate) hereunder, it is necessary or desirable to (i) list, register, qualify or comply with the rules of any securities exchange, (ii) qualify or comply with any applicable state, federal or foreign law, including the applicable tax code and related regulations, or (iii) obtain the consent or approval of any governmental regulatory authority or securities exchange, then such issuance will not occur unless and until such listing, registration, qualification, rule compliance, consent or approval is completed, effected or obtained free of any conditions not acceptable to the Company. Where the Company determines that the delivery of Shares hereunder will violate federal securities laws or other applicable law, the Company will defer delivery until the earliest date on which the Company reasonably anticipates that the delivery of Shares

Exhibit 10.4

hereunder will no longer cause such violation. The Company will make all reasonable efforts to meet the requirements of any such state, federal or foreign law or securities exchange and to obtain any such consent or approval of any such governmental authority or securities exchange.

17.Foreign Exchange. The Grantee acknowledges and agrees that it is the Grantee’s sole responsibility to investigate and comply with any applicable exchange control laws in connection with the issuance and delivery of the Shares pursuant to the vesting of the RSUs and that the Grantee shall be responsible for any reporting of inbound international fund transfers required under applicable law. The Grantee is advised to seek appropriate professional advice as to how the exchange control regulations apply to the Grantee’s specific situation. The Grantee acknowledges and agrees that neither the Company nor any Subsidiary shall be liable for any foreign exchange rate fluctuation between Grantee’s local currency and the United States Dollar that may affect the value of the RSUs, or of any amounts due to Grantee pursuant to the settlement of the RSUs or the subsequent sale of any Shares acquired upon settlement.

18.Miscellaneous. The Company at any time, and from time to time, may amend the terms of this Agreement; provided, however, that the rights of the Grantee shall not be materially adversely affected without the Grantee’s written consent (except to the extent permitted under the Plan). No waiver by either party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. All amounts credited in respect of the RSUs to the book-entry account under this Agreement shall continue for all purposes to be part of the general assets of the Company. The Grantee’s interest in such account shall make the Grantee only a general, unsecured creditor of the Company. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, and each other provision of this Agreement shall be severable and enforceable to the extent permitted by law. In lieu of issuing a fraction of a Share resulting from an adjustment of the RSUs pursuant to Section 9 of the Plan or otherwise, the Company shall be entitled to pay to the Grantee an amount equal to the Fair Market Value of such fractional Share. The terms of this Agreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and to the benefit of the Grantee and the Grantee’s beneficiaries, executors, administrators, heirs and successors. The headings of the Sections hereof are provided for convenience only and are not to serve as a basis for interpretation or construction, and shall not constitute a part, of this Agreement.

19.Entire Agreement. This Agreement (including Appendix A), the Plan and the Grantee’s grant notification contain the entire agreement and understanding of the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations and negotiations in respect thereto.

20.Applicable Law. This Agreement (including Appendix A), the Plan and the Grantee’s grant notification, and all actions taken hereunder or under the Plan, shall be governed by, and construed in accordance with, the laws of the State of New York without regard to the conflict of law principles thereof.

21.Electronic Delivery and Acceptance. The Company may, in its sole discretion, decide to deliver any documents related to the RSUs or future RSUs that may be awarded under the Plan by electronic means, or request the Grantee’s consent to participate in the Plan by electronic means. Such means of electronic delivery may include, but do not necessarily include, the delivery of a link to a Company intranet or the Internet site of a third party involved in administering this award or the Plan, the delivery of the document via electronic mail or such other means of electronic delivery specified by the Company.

Exhibit 10.4

The Grantee consents to the electronic delivery of the Plan documents (including the prospectus relating to the Plan) and this Agreement. The Grantee acknowledges that he or she may receive from the Company a paper copy of any documents delivered electronically, at no cost to the Grantee, by contacting the Company by telephone or in writing. The Grantee further acknowledges that the Grantee will be provided with a paper copy of any documents if the attempted electronic delivery of such documents fails. Similarly, the Grantee understands that the Grantee must provide the Company or any designated third-party administrator with a paper copy of any documents if the attempted electronic delivery of such documents fails. The Grantee may revoke his or her consent to the electronic delivery of documents or may change the electronic mail address to which such documents are to be delivered (if the Grantee has provided an electronic mail address), at any time by notifying the Company of such revoked consent or revised electronic mail address by telephone, postal service or electronic mail. Finally, the Grantee understands that he or she is not required to consent to electronic delivery of documents.

22.No Advice Regarding Grant. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations or assessments regarding Grantee’s acceptance of this award, participation in the Plan, or acquisition or sale of the underlying Shares. The Grantee is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her acceptance of this award and participation in the Plan before taking any action related to the Plan.

23.Counterparts. This Agreement may be executed in one or more counterparts (including via facsimile and electronic image scan (pdf)), each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument and shall become effective when one or more counterparts have been signed by each party and delivered to the other party.

24.Appendix. Notwithstanding any provisions in this Agreement, the RSUs shall be subject to any special terms, conditions or notifications set forth in Appendix A to this Agreement for the Grantee’s country, which shall constitute part of this Agreement. Moreover, if the Grantee relocates to one of the countries included in Appendix A, the special terms and conditions for such country will apply to the Grantee, to the extent the Company determines that the application of such terms and conditions is necessary or advisable in order to comply with local law or facilitate the administration of the Plan.

[Signatures on Next Page]

IN WITNESS WHEREOF, the Company, by its duly authorized officer, and the Grantee have executed this Agreement as of the Grant Date.

By the Grantee’s acceptance of this Agreement, the Grantee and the Company agree that the RSUs are granted under and governed by the terms and conditions of the Plan, the Grantee’s grant notification and this Agreement. The Grantee has reviewed the Plan, the Plan prospectus, the Grantee’s grant notification and this Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Agreement, and fully understands all provisions of the Plan, the Plan prospectus, the Grantee’s grant notification and this Agreement. The Grantee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions relating to the Plan, the Plan prospectus, the Grantee’s grant notification and this Agreement. The Grantee further agrees to notify the Company upon any change in Grantee’s residence address.

Exhibit 10.4

AVON PRODUCTS, INC. GRANTEE

_________________________ Chief Executive Officer _________________________ Name:

APPENDIX A

ADDITIONAL TERMS AND CONDITIONS OF THE

INTERNATIONAL ANNUAL

RESTRICTED STOCK UNIT AWARD AGREEMENT UNDER

THE AVON PRODUCTS, INC. 2016 OMNIBUS INCENTIVE PLAN

NON-U.S. EMPLOYEES

This Appendix includes additional terms and conditions that govern the RSUs granted to the Grantee under the Plan if the Grantee resides in one of the countries listed below. Capitalized terms used but not defined in this Appendix have the meanings set forth in the Plan and/or the Agreement.

The Grantee understands and agrees that the Company strongly recommends that the Grantee not rely on the information herein as the only source of information relating to the consequences of participation in the Plan because applicable rules and regulations regularly change, sometimes on a retroactive basis, and the information may be out of date at the time the RSUs vest or are settled.

In addition, the information contained herein is general in nature and may not apply to Grantee’s particular situation and the Company is not in a position to assure Grantee of any particular result. Accordingly, Grantee is advised to seek appropriate professional advice as to how the relevant laws of Grantee’s country may apply to his or her situation.

The Grantee further understands and agrees that if the Grantee is a citizen or resident of a country other than the one in which the Grantee is currently working, transfers employment after grant of the RSUs, or is considered a resident of another country for local law purposes, the information contained herein may not apply to the Grantee, and the Company shall, in its discretion, determine to what extent the terms and conditions contained herein shall apply, or determine that other terms and conditions are necessary or advisable in order to comply with local law or to facilitate the administration of the Agreement.

Argentina

Securities Law Notice

Exhibit 10.4

The Grantee understands and agrees that neither the grant of the RSUs nor the issuance of Shares constitute a public offering as defined under Argentine law. The offering of the RSUs is a private placement. As such, the offering is not subject to the supervision of any Argentine governmental authority.

Exchange Control Information

The Grantee is solely responsible for complying with the exchange control rules that may apply to the Grantee in connection with his or her participation in the Plan and/or transfer of proceeds from the sale of Shares or receipt of dividends (or Dividend Equivalents) acquired under the Plan into Argentina. Prior to transferring funds into Argentina, the Grantee should consult his or her local bank and/or exchange control advisor to confirm what will be required by the bank because interpretations of the applicable Central Bank regulations vary by bank and exchange control rules and regulations are subject to change without notice.

Brazil

Compliance with Laws

By accepting the RSUs, the Grantee agrees to comply with applicable Brazilian laws and to report and pay any and all applicable Tax Liability associated with the vesting of the RSUs, the sale of the Shares acquired pursuant thereto and the receipt of any dividends. By accepting the RSUs, the Grantee further agrees that, for all legal purposes: (i) the benefits provided under the Plan are the result of commercial transactions unrelated to the Grantee’s employment; (ii) the Plan is not a part of the terms and conditions of the Grantee’s employment; and (iii) the income from the RSUs, if any, is not part of the Grantee’s remuneration from employment.

Report of Overseas Assets

If the Grantee is resident or domiciled in Brazil, the Grantee will be required to submit an annual declaration of assets and rights held outside of Brazil to the Central Bank of Brazil if the aggregate value of such assets and rights equals or exceeds US$100,000. Assets and rights that must be reported include, but are not limited to, the Shares acquired under the Plan.

Colombia

Foreign Exchange Notice

The Grantee understands and acknowledges that if the Grantee’s total overseas investments, including but not limited to any Shares acquired under the Plan, at any time exceeds US $500,000, the Grantee must register such investments with the Colombian Central Bank by June 30 of the following year.

Overseas Investment Registration

The Grantee understands and acknowledges that if the Grantee’s total overseas investments, including but not limited to any payment or Shares acquired pursuant to the Plan, at any time exceeds US $500,000, the Grantee is required to register such investments with the Colombian Central Bank by June 30 of the following year.

Germany

Exhibit 10.4

Exchange Control Information

If the Grantee remits proceeds in excess of €12,500 out of or into Germany, such cross-border payment must be reported monthly to the State Central Bank. In the event that the Grantee makes or receives a payment in excess of this amount, the Grantee is responsible for obtaining the appropriate form from a German bank and complying with applicable reporting requirements. In addition, the Grantee must report on an annual basis if the Grantee holds shares exceeding 10% of the total voting capital of the Company.

Securities Disclaimer

Participation in the Plan is exempt or excluded from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Germany.

Mexico

Employment and Labor Law Acknowledgments

As a condition of accepting the RSUs, the Grantee acknowledges and agrees that: (i) the RSUs are not related to the salary or any other contractual benefits provided to the Grantee by the Grantee’s employer; (ii) any modification of the Plan or its termination shall not constitute a change or impairment of the terms and conditions of the Grantee’s employment; (iii) the grant of the RSUs is unilateral and discretionary and, therefore, the Company reserves the absolute right to amend it and discontinue it at any time without any liability to the Grantee; and (iv) neither the grant of the RSUs nor the issuance of Shares in any way establishes a labor relationship between the Grantee and the Company, which is headquartered in the United States, or any additional rights between the Grantee and the Grantee’s employer, based in Mexico.

By accepting the RSUs, the Grantee acknowledges that he or she has received a copy of the Plan, the Agreement and the Grantee’s grant notification, and has reviewed the Plan, the Agreement, including this Appendix, and the Grantee’s grant notification in their entirety, and fully understands and accepts all provisions thereof.

The Grantee acknowledges and confirms that the Grantee does not reserve any action or right to bring any claim against the Company or its Subsidiaries for any compensation or damages as a result of participation in the Plan and therefore grants a full and broad release to the Company and its Subsidiaries with respect to any claim that may arise under the Plan.

Compliance with Mexican Securities Laws

The Plan, the RSUs and the Shares are exempt from affirmative registration requirements in Mexico because the rights to acquire Shares pursuant to the RSUs and the Plan are limited to specified qualified employees in Mexico and communicated in a private and confidential manner.

Poland

Foreign Exchange Notice

The Grantee understands and acknowledges that the Grantee must notify the National Bank of Poland of the value of all foreign share ownership, including but not limited to Shares acquired under the Plan, if

Exhibit 10.4

such ownership exceeds a designated threshold. If required, the reports are due on a quarterly basis by the 20th day following the end of each quarter. The reports are filed on special forms available on the website of the National Bank of Poland. In addition, the Grantee should maintain evidence of such foreign exchange transactions for five years, in case of a request for their production by the National Bank of Poland. The Grantee is strongly encouraged to consult with an appropriate legal advisor regarding these requirements.

Securities Disclaimer

The grant of the RSUs is exempt from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Poland.

Romania

Exchange Control Information

If the Grantee deposits the proceeds from the sale of Shares issued to the Grantee at purchase in a bank account in Romania, the Grantee may be required to provide the Romanian bank with appropriate documentation explaining the source of the funds. The Grantee should consult his or her personal advisor to determine whether the Grantee will be required to submit such documentation to the Romanian bank.

Securities Disclaimer

Participation in the Plan is exempt or excluded from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Romania.

Spain

Tax Reporting Obligation for Assets Held Abroad

Individuals in Spain are required to report assets and right located outside of Spain (which would include Shares or any funds held in a U.S. brokerage account) on Form 720 by March 31st after each calendar year. A report is not required if the value of assets held outside of Spain is EUR 50,000 or less or if the assets held outside of Spain have not increased by more than EUR 20,000 compared to the previous year (assuming that a prior report has been filed reporting these assets). The Grantee is encouraged to consult his or her personal tax advisor for more information on how to complete the report and the specific information on what types of assets are required to be reported.

Exchange Control Information

The Grantee must declare the acquisition of stock in a foreign company (including Shares acquired under the Plan) to the Dirección General de Política Comercial e Inversiones Exteriores (“DGPCIE”) of the Ministerio de Economia for statistical purposes. He or she must also declare ownership of any stock in a foreign company (including Shares acquired under the Plan) with the Directorate of Foreign Transactions each January while the stock is owned. In addition, if the Grantee wishes to import the share certificates into Spain, he or she must declare the importation of such securities to the DGPCIE.

When receiving foreign currency payments derived from the ownership of the Shares (i.e., dividends or sale proceeds), the Grantee must inform the financial institution receiving the payment of the basis upon which such payment is made. The Grantee will need to provide the following information: (i) his or her

Exhibit 10.4

name, address, and fiscal identification number; (ii) the name and corporate domicile of the Company; (iii) the amount of the payment and the currency used; (iv) the country of origin; (v) the reasons for the payment; and (vi) any further information that may be required.

Securities Disclaimer

The grant of the RSUs is exempt from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Spain.

Turkey

Securities Law Information

Under Turkish law, the Grantee is not permitted to sell Shares acquired under the Plan in Turkey. The Grantee must sell the Shares acquired under the Plan outside of Turkey. The Shares are currently traded on the New York Stock Exchange in the United States under the ticker symbol “AVP” and Shares may be sold on this exchange.

Exchange Control Information

Under Turkish exchange control regulations, the Grantee may be required to use a financial intermediary institution approved under the Turkish Capital Market Law to acquire or sell shares traded on a foreign market and to report such activity to the Capital Markets Board.  The Grantee should consult his or her personal advisor regarding these requirements.

United Kingdom

Tax and National Insurance Contributions

If the Company determines that it is required to account to HM Revenue & Customs for the Tax Liability and any Secondary NIC Liability or to withhold any other tax as a result of the RSUs, the Grantee, as a condition to the vesting of the RSUs, shall make arrangements satisfactory to the Company to enable it to satisfy all withholding liabilities. The Grantee shall also make arrangements satisfactory to the Company to enable it to satisfy any withholding requirements that may arise in connection with the vesting or disposition of Shares acquired pursuant to the RSUs.

As a further condition of the vesting of the RSUs under the Plan, the Grantee may at the Company’s discretion be directed to join with the Company, or if and to the extent that there is a change in the law, any of its Subsidiaries or person who is or becomes a Secondary Contributor in making a Joint Election which has been approved by HM Revenue & Customs, for the transfer of the whole Secondary NIC Liability.

To the extent permitted by law, the Grantee hereby agrees to indemnify and keep indemnified the Company and its Subsidiaries for any Tax Liability.

Securities Disclosure

Neither the Agreement nor this Appendix is an approved prospectus for the purposes of section 85(1) of the Financial Services and Markets Act 2000 (“FSMA”) and no offer of transferable securities to the public (for the purposes of section 102B of FSMA) is being made in connection with the Plan. The Plan

Exhibit 10.4

and the RSUs are exclusively available in the UK to bona fide employees and former employees of the Company and any UK Subsidiary.

****

End of the Appendix

EX-10.5

Exhibit 10.5

AVON PRODUCTS, INC.

2016 OMNIBUS INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

1.Grant of Restricted Stock Unit Award. Pursuant to the provisions of its 2016 Omnibus Incentive Plan (as amended and restated from time to time, the “Plan”), Avon Products, Inc. (the “Company”) has awarded you (the “Grantee”) Restricted Stock Units (the “RSUs”), representing the right to receive, in the future, shares of Stock (the “Shares”) as set forth in the Grantee’s grant notification. The RSUs are subject to the terms and conditions set forth below, as well as those terms and conditions set forth in the Plan, all of which are hereby incorporated by this reference. All capitalized terms used in this Restricted Stock Unit Award Agreement (this “Agreement”) shall have the meaning set forth in the Plan, unless otherwise defined herein.

2.Nature of RSUs; Issuance of Shares.

The RSUs represent a right to receive Shares on the Vesting Date (as defined below) but do not represent a current interest in the Shares. If all the terms and conditions hereof and of the Plan are met, then the Grantee shall be issued Shares on the Vesting Date (or earlier vesting date as provided in this Agreement). Notwithstanding the foregoing or anything in this Agreement to the contrary, the Company reserves the right to determine to settle all or a portion of the Grantee’s vested RSUs in cash, in lieu of Shares. Any such cash payment to the Grantee will equal (x) the Fair Market Value of a Share as of the Vesting Date (or earlier vesting date as provided in this Agreement) multiplied by (y) the number of vested RSUs the Company determines to settle in cash.

The Grantee should be aware that vesting of the RSUs will, to the extent settled in Shares, result in the ownership of Shares and will require the Grantee to open and use a U.S. brokerage account. The Grantee will personally be responsible for any local compliance requirements in relation to all of the above transactions. These requirements may change from time to time, and the Company cannot guarantee that the Grantee will be able to receive Shares on the Vesting Date (or earlier vesting date as provided in this Agreement). Moreover, the Company is not liable for any decrease of value of the Shares.

3.Restrictions on Transfer of RSUs.The RSUs may not be sold, tendered, assigned, transferred, pledged or otherwise encumbered.

4.Vesting of RSUs; Voting; Dividends and Dividend Equivalents.

(a)Subject to Section 5, vesting and settlement of the RSUs shall occur on the date set forth in the Grantee’s grant notification (such date the “Vesting Date”). Subject to Section 5, vesting and settlement are contingent upon the Grantee being employed by the Company or any of its Subsidiaries on the Vesting Date.

Exhibit 10.5

(b)The Grantee does not have the right to vote any of the Shares underlying the RSUs or to receive dividends on them prior to the date such Shares are issued to the Grantee pursuant to the terms hereof. However, unless otherwise determined by the Committee, the Grantee will be credited with Dividend Equivalents with respect to the RSUs. Notwithstanding the foregoing, any such Dividend Equivalents will accumulate and be paid in cash once (and to the extent that) the RSUs vest and settle, provided that the Grantee remains employed by the Company or any Subsidiary through the date such Dividend Equivalents are paid.

5.Separation from Service.

(a)Involuntary Separation from Service by the Company Other Than For Cause.

(i)  At Any Time, Where Grantee Is Not at Retirement or Would Not Attain Retirement by End of Salary Continuation Period. If: (1) regardless of the date of the Separation from Service, the Grantee incurs an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause; and (2) the Grantee has not attained Retirement (for all purposes under this Agreement, as such term is defined under the Plan as of the date hereof) and will not be eligible for Retirement at the end of the salary continuation period for which the Grantee is eligible under a severance pay plan of the Company or any Subsidiary or some other agreement between the Grantee and the Company or any Subsidiary (as if the Grantee made any available election under such plan or agreement to extend the salary continuation period by the maximum period available to such Grantee), in either case as in effect on the date hereof (disregarding any actual election made by the Grantee under such plan or agreement), then a pro-rata portion of the RSUs awarded hereunder shall become vested and such pro-rata portion of RSUs (less any previously vested and settled RSUs) shall be settled in the form of Shares issued to the Grantee within sixty (60) days after such Separation from Service. The number of RSUs that vest shall be determined by multiplying the total number of RSUs awarded hereunder by a fraction, the numerator of which shall be the number of completed months of the Grantee’s employment from the date of grant of the RSUs (the “Grant Date”) to the date of the Grantee’s Separation from Service (typically the last day of active employment), and the denominator of which shall be the total number of months from the Grant Date to the Vesting Date.

(ii)  Separation from Service Occurs Prior to January 1 of the Year Following the Grant Date, Where Grantee Is Either at Retirement or Will Attain Retirement by End of Salary Continuation Period. If: (1) the date of the Separation from Service occurs prior to January 1 of the year following the Grant Date; (2) the Grantee incurs an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause; and (3) either: (A) the Grantee is eligible for Retirement at the time of the date of the Separation from Service; or (B) the Grantee will be eligible for Retirement at the end of the salary continuation period for which the Grantee is eligible under a severance pay plan of the Company or any Subsidiary or some other agreement between the Grantee and the Company or any Subsidiary (as if the Grantee made any available election under such plan or agreement to extend the salary continuation period by the maximum period available to such Grantee), in either case as in effect on the date hereof (disregarding any actual election made by the Grantee under such plan or agreement), then a pro-rata portion of the RSUs awarded hereunder shall become vested and such pro-rata portion of RSUs (less any previously vested and settled RSUs) shall be settled in the form of Shares issued to the Grantee within sixty (60) days after such Separation from Service. The number of RSUs that vest shall be determined by multiplying the total number of RSUs awarded hereunder by a fraction, the numerator of which shall be the number of completed months of the Grantee’s employment from the Grant Date to the date of the Grantee’s Separation from Service (typically

Exhibit 10.5

the last day of active employment), and the denominator of which shall be the total number of months from the Grant Date to the Vesting Date.

(iii)  Separation from Service Occurs on or after January 1 of the Year Following the Grant Date, Where Grantee Is Either at Retirement or Will Attain Retirement by End of Salary Continuation Period. If: (1) the Grantee incurs an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause; (2) the date of such Separation from Service is on or after January 1 of the year following the Grant Date; and (3) either (A) the Grantee is eligible for Retirement at the time of the date of the Separation from Service; or (B) the Grantee will be eligible for Retirement at the end of the salary continuation period for which the Grantee is eligible under a severance pay plan of the Company or any Subsidiary or some other agreement between the Grantee and the Company or any Subsidiary (as if the Grantee made any available election under such plan or agreement to extend the salary continuation period by the maximum period available to such Grantee), in either case as in effect on the date hereof (disregarding any actual election made by the Grantee under such plan or agreement), then all of the RSUs awarded hereunder shall become vested and such vested Shares shall continue to be issued to the Grantee on the Vesting Date.

(b)Voluntary Separation from Service Due to Retirement.

(i)  Separation from Service Prior to January 1 of the Year Following the Grant Date. If: (1) the date of the Separation from Service occurs prior to January 1 of the year following the Grant Date; and (2) the Grantee incurs a voluntary Separation from Service due to Retirement, then a pro-rata portion of the RSUs awarded hereunder shall become vested and such pro-rata portion of RSUs (less any previously vested and settled RSUs) shall be settled in the form of Shares issued to the Grantee within sixty (60) days after such Separation from Service. The number of RSUs that vest shall be determined by multiplying the total number of RSUs awarded hereunder by a fraction, the numerator of which shall be the number of completed months of the Grantee’s employment from the Grant Date to the date of the Grantee’s Separation from Service (typically the last day of active employment), and the denominator of which shall be the total number of months from the Grant Date to the Vesting Date.

(ii)   Separation from Service on or after January 1 of the Year Following the Grant Date. If: (1) the date of the Separation from Service occurs on or after January 1 of the year following the Grant Date; and (2) the Grantee incurs a voluntary Separation from Service due to Retirement, then all of the RSUs awarded hereunder shall become vested and such vested Shares shall continue to be issued to the Grantee on the Vesting Date.

(c)Separation from Service due to Disability. If the Grantee incurs a Separation from Service due to Disability, then all of the RSUs awarded hereunder shall become vested and such vested Shares shall be issued to the Grantee within sixty (60) days after such Separation from Service.

(d)Death. If the Grantee dies before otherwise incurring a Separation from Service, then all of the RSUs awarded hereunder shall become vested and such vested Shares shall be issued to the Grantee’s designated beneficiary (or if none, the Grantee’s estate) within sixty (60) days after such death.

(e)Separations from Service Causing Forfeiture. All RSUs are forfeited if the Grantee incurs a Separation from Service from the Company (and, if applicable, from any Subsidiary by whom the Grantee is employed) under any of the following conditions: (i) an involuntary Separation from Service by the Company or any Subsidiary for Cause prior to the Vesting Date; or (ii) a voluntary Separation from Service (excluding Retirement or Disability) prior to the Vesting Date, provided that to the extent the

Exhibit 10.5

Grantee provides notice of his or her voluntary Separation from Service the RSUs shall be forfeited as of the date that such notice is given.

(f)Change in Control. Notwithstanding any other provision of this Agreement, in the event of a Change in Control, the vesting and settlement of the RSUs shall be governed by the provisions of the Plan regarding a Change in Control, which are incorporated herein by reference.

(g)Paid or Unpaid Leave of Absence or Change in Subsidiary Status for Subsidiary Employing Grantee. For purposes of determining the vesting of RSUs under this Agreement, a paid or unpaid leave of absence of the Grantee that has been approved by the Company shall not constitute a Separation from Service of the Grantee, except to the extent that such leave of absence constitutes a “separation from service” (as defined in U.S. Internal Revenue Code Section 409A (“Section 409A”)). During such paid or unpaid leave of absence, until a “separation from service” occurs, the RSUs shall continue to vest as set forth in this Agreement and the Grantee’s grant notification. For the avoidance of doubt, vesting of RSUs under this Agreement during any notice period relating to any termination of the Grantee’s employment by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause is determined under Section 8(j) of this Agreement. For purposes of determining the vesting of RSUs under this Agreement, the Grantee’s employment by a Subsidiary shall be considered a Separation from Service on the date on which such Subsidiary ceases to be a Subsidiary, provided that payment shall continue to be made in accordance with this Agreement.

(h) Six-Month Wait under U.S. Internal Revenue Code Section 409A. If (i) any payment hereunder is a non-exempt amount payable under a “nonqualified deferred compensation plan” (as defined in Section 409A) upon a Separation from Service (other than death), and (ii) the Grantee is a “specified employee” (as that term is defined in Section 409A and pursuant to procedures established by the Company) on the Grantee’s Separation from Service, then any Shares or cash payable pursuant to the RSUs on account of the Grantee’s Separation from Service (other than death) will not be paid to the Grantee during the six-month period immediately following such Separation from Service. Instead, the Shares or cash that would have been payable to the Grantee on account of the Grantee’s Separation from Service under this Agreement shall be paid no earlier than the first day of the seventh month following the Grantee’s Separation from Service.

6.Non-Competition/Non-Solicitation/Non-Disclosure.

The Grantee agrees that, during the Grantee’s employment, beginning on the Grant Date, and for a period of one year after the Grantee’s Separation from Service with the Company (and, if applicable, a Subsidiary) for any reason whatsoever (including, but not limited to, with or without Cause, Retirement or Disability), he or she shall not, without the prior written consent of the Committee, engage in any of the following activities:

(a)directly or indirectly engage or otherwise participate in any business which is competitive with any significant business of the Company or any Subsidiary, including without limitation, the Grantee’s acceptance of employment with, entrance into a consulting or advisory arrangement with, rendering services to or otherwise facilitating the business of Amway Corp./Alticor Inc., Amore Pacific, Arabela, Arbonne, Beiersdorf (Nivea), COTY, De Millus S.A., Ebel Int’l/Belcorp Corp., Elizabeth Arden, Faberlic, Herbalife Ltd., Inter Parfums, Jequiti, Lady Racine/LR Health & Beauty Systems GmbH, LG Health & Household, L’Occitane, L’Oréal Group/Cosmair Inc., Mary Kay Inc., Mistine/Better Way (Thailand) Co. Ltd., Natura Cosmetics S.A., Neways Int’l, NuSkin Enterprises Inc., O Boticário, Oriflame Cosmetics S.A., Origami Owl, Reckitt Benckiser PLC, Revlon Inc., Rodan & Fields, Shaklee Corp., Shiseido, Stella & Dot, Silpada, The Body Shop Int’l PLC, The Estée Lauder Companies Inc., The Procter

Exhibit 10.5

& Gamble Company, Tupperware Corp., Unilever Group (N.V. and PLC), Vorwerk & Co. KG/Jafra Worldwide Holdings (Lux) S.à.R.L. Inc., Yanbal Int’l (Yanbal, Unique), Younique or any of their affiliates; or

(b)solicit or aid in the solicitation of any employees of the Company or any Subsidiary to leave their employment.

In addition, the Grantee shall not, unless compelled pursuant to an order of a court or other body having jurisdiction over such matter, communicate or divulge any secret or confidential information, knowledge or data, including without limitation any trade secrets, relating to the Company or a Subsidiary, and their respective businesses, obtained by the Grantee during his or her employment by the Company or a Subsidiary and which is not otherwise publicly known (other than by reason of an unauthorized act by the Grantee), to anyone other than the Company and those designated by it.

In the event the Company determines that the Grantee has breached any term of this Section 6 or any non-disclosure, non-compete or non-solicitation covenant set forth in his or her severance, employment or similar contract or any Company policy, then in addition to any other remedies the Company may have available to it, unless otherwise determined by the Committee: (i) all unvested RSUs granted hereunder shall be forfeited; (ii) if Shares have been issued to the Grantee in respect of vested RSUs hereunder, then the Grantee shall forfeit all such Shares so issued to the Grantee hereunder; and (iii) if cash has been paid to the Grantee in lieu of Shares in respect of all or a portion of the vested RSUs hereunder, then the Grantee shall pay to the Company all such cash so paid; provided, however, that if the Grantee no longer holds Shares issued to the Grantee hereunder, then, the Grantee shall pay to the Company in cash the Fair Market Value of the Shares issued to the Grantee hereunder, determined as of the date of such issuance.

Notwithstanding anything in this Section 6 to the contrary, this Agreement is not intended to, and shall be interpreted in a manner that does not, limit or restrict the Grantee from exercising any legally protected whistleblower rights (including pursuant to Rule 21F under the U.S. Securities Exchange Act of 1934).

7.Recoupment. Except where void by law and unless otherwise determined by the Company, the RSUs, and any Shares or cash issued upon settlement of any vested RSUs, are subject to forfeiture and/or recoupment in the event that a Grantee has engaged in misconduct, including: (x) a serious violation of the Company’s Code of Conduct; or (y) a violation of law within the scope of employment with the Company and its Subsidiaries. All RSUs hereunder are also subject to the Company’s Compensation Recoupment Policy.

8.Service Acknowledgments.

The Grantee acknowledges and agrees as follows:

(a)The execution and delivery of this Agreement and the granting of the RSUs hereunder shall not constitute or be evidence of any agreement or understanding, express or implied, on the part of the Company or its Subsidiaries to employ the Grantee for any specific period.

Exhibit 10.5

(b)The award of the RSUs hereunder is voluntary and occasional and does not entitle the Grantee to any benefit other than that specifically granted under this Agreement and under the Plan, or to any future grants or other benefits under the Plan or any similar plan, even if RSUs have ever been granted in the past or have repeatedly been granted in the past. Any benefits granted under this Agreement and under the Plan are extraordinary and not part of the Grantee’s ordinary or expectedcompensationor salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, end-of-service payments, bonuses, long-service awards, pension, welfare or retirement benefits or similar payments and in no event should be considered as compensation for, or relating in any way to, past services for the Company or any of its Subsidiaries. The Grantee understands and accepts that the benefits granted under the Plan are entirely at the grace and discretion of the Company and that the Company retains the right to amend or terminate the Plan, and/or the Grantee’s participation therein, at any time, at the Company’s sole discretion and without notice, subject to applicable law and the terms of the Plan.

(c)Nothing in this Agreement shall confer upon the Grantee any right to continue in the service of the Company or a Subsidiary or interfere in any way with any right of the Company or a Subsidiary to terminate the employment of the Grantee at any time, subject to applicable law.

(d)The Grantee is participating in the Plan, accepting the RSUs and entering into this Agreement voluntarily.

(e)The Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, to the extent permitted by the Plan.

(f)All decisions with respect to future RSUs or other grants, if any, will be at the sole discretion of the Company.

(g)The future value of the underlying Shares is unknown, indeterminable and cannot be predicted with certainty. The value of the Shares may increase or decrease.

(h)Neither the Company nor any Subsidiary is providing any tax, legal or financial advice or making any recommendations regarding this award, or the Grantee’s participation in the Plan, or the Grantee’s acquisition or sale of the Shares.

(i)In consideration of the grant of the RSUs, (i) the Grantee shall have no claim or entitlement to compensation or damages arising from (x) forfeiture of the RSUs resulting from termination of the Grantee’s service (for any reason whether or not in breach of local law) or otherwise pursuant to this Agreement or (y) diminution in value of the RSUs or Shares underlying the RSUs and (ii) the Grantee irrevocably releases the Company and its Subsidiaries from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by accepting the RSUs, the Grantee shall be deemed irrevocably to have waived the Grantee’s entitlement to pursue such a claim.

Exhibit 10.5

(j)Any notice period mandated under applicable law or otherwise arising in connection with an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause shall be treated as service for the purpose of determining the vesting of the RSUs. However, any such notice period mandated under applicable law or otherwise for which the Grantee receives pay in lieu of such notice shall not be treated as service for purposes of determining the vesting of the RSUs, and the Grantee’s right to settlement of the RSUs after termination of service, if any, will be measured by the date of termination of the Grantee’s active service and will not be extended by any such notice period. Similarly, if the Company elects to place the Grantee on garden leave (or the equivalent) during any notice period arising in connection with an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause, such garden leave period shall not be treated as service for the purpose of determining the vesting of the RSUs, and the Grantee’s right to settlement of the RSUs after termination of service, if any, will be measured by the date of termination of the Grantee’s active service (i.e., the commencement of such leave) and will not be extended by any such leave. Subject to the foregoing and the provisions of the Plan, the Company, in its sole discretion, shall determine whether the Grantee’s service has terminated and the effective date of such termination.

(k)The grant of RSUs will not be interpreted to form an employment contract or employment relationship with the Company or any of its Subsidiaries that does not otherwise exist.

9.Data Privacy Acknowledgment and Consent.

By signing this Agreement, the Grantee acknowledges and agrees that in order to implement, manage and administer this award and the Grantee’s participation in the Plan, and/or in connection with tax or other governmental and regulatory compliance activities directly or indirectly related to the RSUs, the Company and/or an entity belonging to the Company’s group of companies (including the Grantee’s employer) may need to process the Grantee’s personal data (electronically or otherwise), including, but not limited to, the Grantee’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any Shares or other equity securities, directorships held in the Company, details of all RSUs or any other entitlements awarded, canceled, vested, unvested or outstanding in the Grantee’s favor (the “Personal Data”). The transfer of Personal Data to and collection by third-party service providers outside the Company’s group of companies, such as the Company’s authorized agent, may also be necessary in order to implement, manage and administer this award and the Plan.

The Grantee expressly and unambiguously consents to the collection, use and other processing of Personal Data by the Company, entities belonging to the Company’s group of companies, and third-party service providers. The Grantee understands that Company may transfer Grantee’s Personal Data to the United States, or other countries which may have a different or lower level of data protection law than the Grantee’s home country and which are not considered by the European Commission or the United Kingdom (should the United Kingdom cease to be a member of the European Economic Area (the “EEA”)) (if the Grantee is a resident of the United Kingdom or the EEA) or the data protection agencies of other jurisdictions to have data protection laws equivalent to the laws in Grantee’s country. The Company will therefore maintain an EU-US Privacy Shield certification or enter into an alternate data processing and transfer arrangement authorized by applicable law, such as Standard Contractual Clauses, to protect the Grantee’s Personal Data consistent with data protection laws of the European Union or the United Kingdom (should the United Kingdom cease to be a member of the EEA).

In addition, the Grantee expressly and unambiguously consents to the disclosure of Personal Data to, and processing by, a third party in the event of any potential or actual reorganization, merger, sale, joint

Exhibit 10.5

venture, assignment, transfer or other disposition of all or any portion of the Company’s business, assets or stock (including in connection with any bankruptcy or similar proceedings); and as the Company believes necessary or appropriate: (a) under applicable law, including laws outside of Grantee’s country; (b) to comply with legal processes; and (c) to respond to requests from public and government authorities including public and government authorities outside of Grantee’s country.

The Grantee authorizes the recipients to receive, possess, use, retain and transfer the Personal Data, in electronic or other form, for the purposes of implementing, managing and administering this award and the Grantee’s participation in the Plan, including any requisite transfer of such Personal Data as may be required to a broker or other third party with whom the Grantee may elect to deposit any Shares acquired upon settlement of the RSUs. The Grantee understands that Personal Data will be held only as long as is necessary to implement, manage and administer this award and the Grantee’s participation in the Plan, unless a longer retention period is required by applicable laws, regulations, rules or valid requests or orders of a court or other dispute resolution forums or of a governmental or public authority, in each case, including those of a court or other dispute resolution forums or of a governmental or public authority outside of Grantee’s country. The Grantee understands that he or she may, at any time, view his or her Personal Data, request additional information about the storage and processing of his or her Personal Data, require any necessary amendments to his or her Personal Data that is incorrect or refuse or withdraw the consents herein, in any case without cost, by contacting in writing the Grantee’s local stock program coordinator.

If Grantee does not consent, or if Grantee later seeks to revoke Grantee’s consent, Grantee’s employment status or career with the Company or Subsidiary will not be adversely affected; the only adverse consequence of refusing or withdrawing Grantee’s consent is that the Company would not be able to grant RSUs under the Plan or other equity awards, or manage or administer such awards. Therefore, Grantee understands that refusing or withdrawing Grantee’s consent may affect Grantee’s ability to participate in the Plan. For more information on the consequences of the Grantee’s refusal to consent or withdrawal of consent, the Grantee understands that he or she may contact the Grantee’s local stock program coordinator.

If the Grantee is a resident of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA), his or her Personal Data will not be processed on the basis of consent (unless the Grantee provides a specific consent separate from this Section 9), but will be processed where necessary to fulfil the Company’s contractual obligations with the Grantee, where necessary to comply with the Company’s legal obligations under any applicable laws, or to meet the Company’s legitimate business interests. The Company has a legitimate interest in managing its business appropriately including incentivizing its employees, complying with its legal and contractual obligations, and keeping its records accurate and up to date. Grantees who are residents of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA) should refer to the Privacy Statement for Associates issued by his or her employer for additional information about the processing of the Grantee’s Personal Data and his or her privacy rights. The Privacy Statement for Associates will govern the processing of the Grantee’s Personal Data in connection with the administration of this award and the Grantee’s participation in the Plan.

The Company will take reasonable measures to keep the Personal Data private, confidential and accurate. The Grantee may obtain details with respect to the collection, use, processing and transfer of his/her Personal Data in relation to Plan participation and may also request a list with names and addresses of potential recipients of the Data and/or access to and updates of such Personal Data, if needed, by contacting his or her local stock program coordinator.

Exhibit 10.5

10.Responsibility for Taxes.

By accepting this grant, the Grantee hereby irrevocably elects to satisfy any taxes and social insurance contribution withholding required to be withheld by the Company or its Subsidiaries on the date of grant or vesting of the RSUs or the date of delivery or sale of any Shares hereunder or on any earlier date on which such taxes or social insurance contribution withholding may be due (“Tax Liability”) by authorizing the Company or any of its Subsidiaries to withhold a sufficient number of Shares that would otherwise be deliverable to the Grantee upon settlement of the RSUs (or, if the RSUs are settled in cash in lieu of Shares, an amount of cash sufficient to satisfy the Tax Liability). If, for any reason, the Shares or cash that would otherwise be deliverable to the Grantee upon settlement of the RSUs would be insufficient to satisfy the Tax Liability, the Company and any of its Subsidiaries are authorized to withhold an amount from the Grantee’s wages or other compensation sufficient to satisfy the Tax Liability. Furthermore, the Grantee agrees to pay the Company or its Subsidiaries any amount of the Tax Liability that cannot be satisfied through one of the foregoing methods.

Notwithstanding the foregoing, if, on the applicable Settlement Date or on any earlier date on which the Tax Liability may be due, the delivery of Shares is not made for any reason (including pursuant to a deferral election made by the Grantee under the Company’s Deferred Compensation Plan, if applicable), the Grantee hereby irrevocably elects to satisfy such Tax Liability by delivering cash to the Company in an amount sufficient to satisfy such Tax Liability.

Apart from any withholding obligations that may apply to the Company and/or its Subsidiaries, the Grantee acknowledges and agrees that the ultimate responsibility for the Tax Liability is and remains with the Grantee. The Grantee further acknowledges that: (x) the Company and its Subsidiaries make no representations or undertakings regarding the Tax Liability or the receipt of any dividends; (y) the Company and its Subsidiaries do not commit to structure the terms of the grant or any other aspect of the RSUs to reduce or eliminate the Tax Liability; and (z) the Grantee should consult a tax adviser regarding the Tax Liability.

The Grantee acknowledges that he or she may not participate in the Plan and the Company and its Subsidiaries shall have no obligation to deliver Shares until the Tax Liability has been fully satisfied by the Grantee.

11.U.S. Internal Revenue Code Section 409A. To the extent the Grantee is subject to Section 409A, any provision, application or interpretation of this Agreement that is inconsistent with Section 409A shall be disregarded. In no event shall the Company, any of its affiliates, any of its agents, or any member of the Board have any liability for any taxes, interest or penalties imposed in connection with a failure of the Plan to comply with Section 409A.

12.Notice. Any notice required to be given hereunder to the Grantee shall be addressed to the Grantee at his or her current address shown on the Company’s records. Notice shall be sent by mail, express delivery or, if practical, by electronic delivery or hand delivery.

13.Provisions Inconsistent with Translation. To the extent that the Grantee has been provided with a translation of this Agreement, the English language version of this Agreement shall prevail in case of any discrepancies or ambiguities due to translation.

Exhibit 10.5

14.Acknowledgment. The Company and the Grantee agree that the RSUs are granted under, and governed by, the Grantee’s grant notification, this Agreement and the Plan. The Grantee: (x) acknowledges receipt of a copy of such grant notification, this Agreement, the Plan and the prospectus relating to the Plan; (y) represents that the Grantee has carefully read and is familiar with their provisions; and (z) hereby accepts the RSUs subject to all of the terms and conditions set forth in the Grantee’s grant notification, this Agreement and the Plan.

15.Compliance with Laws and Regulations. The granting of the RSUs and the delivery of Shares hereunder shall be subject to all applicable laws, rules and regulations. The issuance of Shares will be subject to and conditioned upon compliance by the Company and its Subsidiaries and the Grantee with all applicable laws and regulations and with all applicable requirements of any stock exchange or automated quotation system on which the Shares may be listed or quoted at the time of such issuance or transfer. If any provision of this Agreement conflicts with applicable mandatory law, the provisions of such law shall govern.

16.Additional Conditions to Issuance of Shares. If at any time the Company determines, in its discretion, that as a condition to the issuance of Shares to the Grantee (or the Grantee’s estate) hereunder, it is necessary or desirable to (i) list, register, qualify or comply with the rules of any securities exchange, (ii) qualify or comply with any applicable state, federal or foreign law, including the applicable tax code and related regulations, or (iii) obtain the consent or approval of any governmental regulatory authority or securities exchange, then such issuance will not occur unless and until such listing, registration, qualification, rule compliance, consent or approval is completed, effected or obtained free of any conditions not acceptable to the Company. Where the Company determines that the delivery of Shares hereunder will violate federal securities laws or other applicable law, the Company will defer delivery until the earliest date on which the Company reasonably anticipates that the delivery of Shares hereunder will no longer cause such violation. The Company will make all reasonable efforts to meet the requirements of any such state, federal or foreign law or securities exchange and to obtain any such consent or approval of any such governmental authority or securities exchange.

17.Foreign Exchange. The Grantee acknowledges and agrees that it is the Grantee’s sole responsibility to investigate and comply with any applicable exchange control laws in connection with the issuance and delivery of the Shares pursuant to the vesting of the RSUs and that the Grantee shall be responsible for any reporting of inbound international fund transfers required under applicable law. The Grantee is advised to seek appropriate professional advice as to how the exchange control regulations apply to the Grantee’s specific situation. The Grantee acknowledges and agrees that neither the Company nor any Subsidiary shall be liable for any foreign exchange rate fluctuation between Grantee’s local currency and the United States Dollar that may affect the value of the RSUs, or of any amounts due to Grantee pursuant to the settlement of the RSUs or the subsequent sale of any Shares acquired upon settlement.

18.Miscellaneous. The Company at any time, and from time to time, may amend the terms of this Agreement; provided, however, that the rights of the Grantee shall not be materially adversely affected without the Grantee’s written consent (except to the extent permitted under the Plan). No waiver by either party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. All amounts credited in respect of the RSUs to the book-entry account under this Agreement shall continue for all purposes to be part of the general assets of the Company. The Grantee’s interest in such account shall make the Grantee only a general, unsecured creditor of the Company. The invalidity or unenforceability of any provision of this Agreement shall not affect the

Exhibit 10.5

validity or enforceability of any other provision of this Agreement, and each other provision of this Agreement shall be severable and enforceable to the extent permitted by law. In lieu of issuing a fraction of a Share resulting from an adjustment of the RSUs pursuant to Section 9 of the Plan or otherwise, the Company shall be entitled to pay to the Grantee an amount equal to the Fair Market Value of such fractional Share. The terms of this Agreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and to the benefit of the Grantee and the Grantee’s beneficiaries, executors, administrators, heirs and successors. The headings of the Sections hereof are provided for convenience only and are not to serve as a basis for interpretation or construction, and shall not constitute a part, of this Agreement.

19.Entire Agreement. This Agreement (including Appendix A), the Plan and the Grantee’s grant notification contain the entire agreement and understanding of the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations and negotiations in respect thereto.

20.Applicable Law. This Agreement (including Appendix A), the Plan and the Grantee’s grant notification, and all actions taken hereunder or under the Plan, shall be governed by, and construed in accordance with, the laws of the State of New York without regard to the conflict of law principles thereof.

21.Electronic Delivery and Acceptance. The Company may, in its sole discretion, decide to deliver any documents related to the RSUs or future RSUs that may be awarded under the Plan by electronic means, or request the Grantee’s consent to participate in the Plan by electronic means. Such means of electronic delivery may include, but do not necessarily include, the delivery of a link to a Company intranet or the Internet site of a third party involved in administering this award or the Plan, the delivery of the document via electronic mail or such other means of electronic delivery specified by the Company. The Grantee consents to the electronic delivery of the Plan documents (including the prospectus relating to the Plan) and this Agreement. The Grantee acknowledges that he or she may receive from the Company a paper copy of any documents delivered electronically, at no cost to the Grantee, by contacting the Company by telephone or in writing. The Grantee further acknowledges that the Grantee will be provided with a paper copy of any documents if the attempted electronic delivery of such documents fails. Similarly, the Grantee understands that the Grantee must provide the Company or any designated third-party administrator with a paper copy of any documents if the attempted electronic delivery of such documents fails. The Grantee may revoke his or her consent to the electronic delivery of documents or may change the electronic mail address to which such documents are to be delivered (if the Grantee has provided an electronic mail address), at any time by notifying the Company of such revoked consent or revised electronic mail address by telephone, postal service or electronic mail. Finally, the Grantee understands that he or she is not required to consent to electronic delivery of documents.

22. No Advice Regarding Grant. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations or assessments regarding Grantee’s acceptance of this award, participation in the Plan, or acquisition or sale of the underlying Shares. The Grantee is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her acceptance of this award and participation in the Plan before taking any action related to the Plan.

23.Counterparts. This Agreement may be executed in one or more counterparts (including via facsimile and electronic image scan (pdf)), each of which shall be deemed to be an original, but all of

Exhibit 10.5

which together shall constitute one and the same instrument and shall become effective when one or more counterparts have been signed by each party and delivered to the other party.

24.Appendix. Notwithstanding any provisions in this Agreement, the RSUs shall be subject to any special terms, conditions or notifications set forth in Appendix A to this Agreement for the Grantee’s country, which shall constitute part of this Agreement. Moreover, if the Grantee relocates to one of the countries included in Appendix A, the special terms and conditions for such country will apply to the Grantee, to the extent the Company determines that the application of such terms and conditions is necessary or advisable in order to comply with local law or facilitate the administration of the Plan.

[Signatures on Next Page]

IN WITNESS WHEREOF, the Company, by its duly authorized officer, and the Grantee have executed this Agreement as of the Grant Date.

By the Grantee’s acceptance of this Agreement, the Grantee and the Company agree that the RSUs are granted under and governed by the terms and conditions of the Plan, the Grantee’s grant notification and this Agreement. The Grantee has reviewed the Plan, the Plan prospectus, the Grantee’s grant notification and this Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Agreement, and fully understands all provisions of the Plan, the Plan prospectus, the Grantee’s grant notification and this Agreement. The Grantee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions relating to the Plan, the Plan prospectus, the Grantee’s grant notification and this Agreement. The Grantee further agrees to notify the Company upon any change in Grantee’s residence address.

AVON PRODUCTS, INC. GRANTEE

_________________________ Chief Executive Officer _________________________ Name:

APPENDIX A

ADDITIONAL TERMS AND CONDITIONS OF THE

INTERNATIONAL ANNUAL

Exhibit 10.5

RESTRICTED STOCK UNIT AWARD AGREEMENT UNDER

THE AVON PRODUCTS, INC. 2016 OMNIBUS INCENTIVE PLAN

NON-U.S. EMPLOYEES

This Appendix includes additional terms and conditions that govern the RSUs granted to the Grantee under the Plan if the Grantee resides in one of the countries listed below. Capitalized terms used but not defined in this Appendix have the meanings set forth in the Plan and/or the Agreement.

The Grantee understands and agrees that the Company strongly recommends that the Grantee not rely on the information herein as the only source of information relating to the consequences of participation in the Plan because applicable rules and regulations regularly change, sometimes on a retroactive basis, and the information may be out of date at the time the RSUs vest or are settled.

In addition, the information contained herein is general in nature and may not apply to Grantee’s particular situation and the Company is not in a position to assure Grantee of any particular result. Accordingly, Grantee is advised to seek appropriate professional advice as to how the relevant laws of Grantee’s country may apply to his or her situation.

The Grantee further understands and agrees that if the Grantee is a citizen or resident of a country other than the one in which the Grantee is currently working, transfers employment after grant of the RSUs, or is considered a resident of another country for local law purposes, the information contained herein may not apply to the Grantee, and the Company shall, in its discretion, determine to what extent the terms and conditions contained herein shall apply, or determine that other terms and conditions are necessary or advisable in order to comply with local law or to facilitate the administration of the Agreement.

Argentina

Securities Law Notice

The Grantee understands and agrees that neither the grant of the RSUs nor the issuance of Shares constitute a public offering as defined under Argentine law. The offering of the RSUs is a private placement. As such, the offering is not subject to the supervision of any Argentine governmental authority.

Exchange Control Information

The Grantee is solely responsible for complying with the exchange control rules that may apply to the Grantee in connection with his or her participation in the Plan and/or transfer of proceeds from the sale of Shares or receipt of dividends (or Dividend Equivalents) acquired under the Plan into Argentina. Prior to transferring funds into Argentina, the Grantee should consult his or her local bank and/or exchange control advisor to confirm what will be required by the bank because interpretations of the applicable Central Bank regulations vary by bank and exchange control rules and regulations are subject to change without notice.

Brazil

Compliance with Laws

Exhibit 10.5

By accepting the RSUs, the Grantee agrees to comply with applicable Brazilian laws and to report and pay any and all applicable Tax Liability associated with the vesting of the RSUs, the sale of the Shares acquired pursuant thereto and the receipt of any dividends. By accepting the RSUs, the Grantee further agrees that, for all legal purposes: (i) the benefits provided under the Plan are the result of commercial transactions unrelated to the Grantee’s employment; (ii) the Plan is not a part of the terms and conditions of the Grantee’s employment; and (iii) the income from the RSUs, if any, is not part of the Grantee’s remuneration from employment.

Report of Overseas Assets

If the Grantee is resident or domiciled in Brazil, the Grantee will be required to submit an annual declaration of assets and rights held outside of Brazil to the Central Bank of Brazil if the aggregate value of such assets and rights equals or exceeds US$100,000. Assets and rights that must be reported include, but are not limited to, the Shares acquired under the Plan.

Colombia

Foreign Exchange Notice

The Grantee understands and acknowledges that if the Grantee’s total overseas investments, including but not limited to any Shares acquired under the Plan, at any time exceeds US $500,000, the Grantee must register such investments with the Colombian Central Bank by June 30 of the following year.

Overseas Investment Registration

The Grantee understands and acknowledges that if the Grantee’s total overseas investments, including but not limited to any payment or Shares acquired pursuant to the Plan, at any time exceeds US $500,000, the Grantee is required to register such investments with the Colombian Central Bank by June 30 of the following year.

Germany

Exchange Control Information

If the Grantee remits proceeds in excess of €12,500 out of or into Germany, such cross-border payment must be reported monthly to the State Central Bank. In the event that the Grantee makes or receives a payment in excess of this amount, the Grantee is responsible for obtaining the appropriate form from a German bank and complying with applicable reporting requirements. In addition, the Grantee must report on an annual basis if the Grantee holds shares exceeding 10% of the total voting capital of the Company.

Securities Disclaimer

Participation in the Plan is exempt or excluded from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Germany.

Mexico

Employment and Labor Law Acknowledgments

Exhibit 10.5

As a condition of accepting the RSUs, the Grantee acknowledges and agrees that: (i) the RSUs are not related to the salary or any other contractual benefits provided to the Grantee by the Grantee’s employer; (ii) any modification of the Plan or its termination shall not constitute a change or impairment of the terms and conditions of the Grantee’s employment; (iii) the grant of the RSUs is unilateral and discretionary and, therefore, the Company reserves the absolute right to amend it and discontinue it at any time without any liability to the Grantee; and (iv) neither the grant of the RSUs nor the issuance of Shares in any way establishes a labor relationship between the Grantee and the Company, which is headquartered in the United States, or any additional rights between the Grantee and the Grantee’s employer, based in Mexico.

By accepting the RSUs, the Grantee acknowledges that he or she has received a copy of the Plan, the Agreement and the Grantee’s grant notification, and has reviewed the Plan, the Agreement, including this Appendix, and the Grantee’s grant notification in their entirety, and fully understands and accepts all provisions thereof.

The Grantee acknowledges and confirms that the Grantee does not reserve any action or right to bring any claim against the Company or its Subsidiaries for any compensation or damages as a result of participation in the Plan and therefore grants a full and broad release to the Company and its Subsidiaries with respect to any claim that may arise under the Plan.

Compliance with Mexican Securities Laws

The Plan, the RSUs and the Shares are exempt from affirmative registration requirements in Mexico because the rights to acquire Shares pursuant to the RSUs and the Plan are limited to specified qualified employees in Mexico and communicated in a private and confidential manner.

Poland

Foreign Exchange Notice

The Grantee understands and acknowledges that the Grantee must notify the National Bank of Poland of the value of all foreign share ownership, including but not limited to Shares acquired under the Plan, if such ownership exceeds a designated threshold. If required, the reports are due on a quarterly basis by the 20th day following the end of each quarter. The reports are filed on special forms available on the website of the National Bank of Poland. In addition, the Grantee should maintain evidence of such foreign exchange transactions for five years, in case of a request for their production by the National Bank of Poland. The Grantee is strongly encouraged to consult with an appropriate legal advisor regarding these requirements.

Securities Disclaimer

The grant of the RSUs is exempt from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Poland.

Romania

Exchange Control Information

If the Grantee deposits the proceeds from the sale of Shares issued to the Grantee at purchase in a bank account in Romania, the Grantee may be required to provide the Romanian bank with appropriate

Exhibit 10.5

documentation explaining the source of the funds. The Grantee should consult his or her personal advisor to determine whether the Grantee will be required to submit such documentation to the Romanian bank.

Securities Disclaimer

Participation in the Plan is exempt or excluded from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Romania.

Spain

Tax Reporting Obligation for Assets Held Abroad

Individuals in Spain are required to report assets and right located outside of Spain (which would include Shares or any funds held in a U.S. brokerage account) on Form 720 by March 31st after each calendar year. A report is not required if the value of assets held outside of Spain is EUR 50,000 or less or if the assets held outside of Spain have not increased by more than EUR 20,000 compared to the previous year (assuming that a prior report has been filed reporting these assets). The Grantee is encouraged to consult his or her personal tax advisor for more information on how to complete the report and the specific information on what types of assets are required to be reported.

Exchange Control Information

The Grantee must declare the acquisition of stock in a foreign company (including Shares acquired under the Plan) to the Dirección General de Política Comercial e Inversiones Exteriores (“DGPCIE”) of the Ministerio de Economia for statistical purposes. He or she must also declare ownership of any stock in a foreign company (including Shares acquired under the Plan) with the Directorate of Foreign Transactions each January while the stock is owned. In addition, if the Grantee wishes to import the share certificates into Spain, he or she must declare the importation of such securities to the DGPCIE.

When receiving foreign currency payments derived from the ownership of the Shares (i.e., dividends or sale proceeds), the Grantee must inform the financial institution receiving the payment of the basis upon which such payment is made. The Grantee will need to provide the following information: (i) his or her name, address, and fiscal identification number; (ii) the name and corporate domicile of the Company; (iii) the amount of the payment and the currency used; (iv) the country of origin; (v) the reasons for the payment; and (vi) any further information that may be required.

Securities Disclaimer

The grant of the RSUs is exempt from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Spain.

Turkey

Securities Law Information

Under Turkish law, the Grantee is not permitted to sell Shares acquired under the Plan in Turkey. The Grantee must sell the Shares acquired under the Plan outside of Turkey. The Shares are currently traded on the New York Stock Exchange in the United States under the ticker symbol “AVP” and Shares may be sold on this exchange.

Exchange Control Information

Exhibit 10.5

Under Turkish exchange control regulations, the Grantee may be required to use a financial intermediary institution approved under the Turkish Capital Market Law to acquire or sell shares traded on a foreign market and to report such activity to the Capital Markets Board.  The Grantee should consult his or her personal advisor regarding these requirements.

United Kingdom

Tax and National Insurance Contributions

If the Company determines that it is required to account to HM Revenue & Customs for the Tax Liability and any Secondary NIC Liability or to withhold any other tax as a result of the RSUs, the Grantee, as a condition to the vesting of the RSUs, shall make arrangements satisfactory to the Company to enable it to satisfy all withholding liabilities. The Grantee shall also make arrangements satisfactory to the Company to enable it to satisfy any withholding requirements that may arise in connection with the vesting or disposition of Shares acquired pursuant to the RSUs.

As a further condition of the vesting of the RSUs under the Plan, the Grantee may at the Company’s discretion be directed to join with the Company, or if and to the extent that there is a change in the law, any of its Subsidiaries or person who is or becomes a Secondary Contributor in making a Joint Election which has been approved by HM Revenue & Customs, for the transfer of the whole Secondary NIC Liability.

To the extent permitted by law, the Grantee hereby agrees to indemnify and keep indemnified the Company and its Subsidiaries for any Tax Liability.

Securities Disclosure

Neither the Agreement nor this Appendix is an approved prospectus for the purposes of section 85(1) of the Financial Services and Markets Act 2000 (“FSMA”) and no offer of transferable securities to the public (for the purposes of section 102B of FSMA) is being made in connection with the Plan. The Plan and the RSUs are exclusively available in the UK to bona fide employees and former employees of the Company and any UK Subsidiary.

****

End of the Appendix

EX-10.6

Exhibit 10.6

AVON PRODUCTS, INC.

2016 OMNIBUS INCENTIVE PLAN

STOCK APPRECIATION RIGHTS AGREEMENT

______________________________

1. Grant of SAR Grant. Pursuant to the provisions of its 2016 Omnibus Incentive Plan (as amended and restated from time to time, the “Plan”), Avon Products, Inc. (the “Company”) has granted (the “SAR Grant”) to you (the “Grantee”) Stock Appreciation Rights (the “SARs”) relating to shares of Stock (“Shares”) at a fixed price (the “SAR Grant Price”) per share as set forth in the Grantee’s grant notification. This SAR Grant does not give the Grantee any current or future interest in actual shares of the Stock. Rather, this SAR Grant provides a right to the Grantee, subject to all the terms and conditions of this Stock Appreciation Rights Agreement (this “Agreement”) and the Plan, to receive a cash payment or payments only. All capitalized terms used in this Agreement shall have the meaning set forth in the Plan, unless the context requires a different meaning.

2.Exercise of the SAR Grant.

(a)This SAR Grant shall be exercisable in the installments outlined in the Grantee’s grant notification. The entire SAR Grant is fully exercisable after the final vesting date. To the extent that any of the installments becomes exercisable, it shall continue to be exercisable at any time thereafter until this SAR Grant shall terminate, expire or be surrendered.

(b)All or a portion of a SAR Grant installment may be exercised, on or after its vesting date, by giving the Company’s Global Compensation Department written notice of exercise, specifying the number of SARs to be exercised. The Grantee will, upon exercise of such SARs, be entitled to receive a cash payment equal to (x) the excess of the Fair Market Value of a Share on the exercise date over the SAR Grant Price multiplied by (y) the number of SARs being exercised, less any tax withholdings. The net cash proceeds are payable to the Grantee. Each payment will be made in local currency, usually that of the country where the Grantee is principally employed as of the date of exercise, or in U.S. Dollars. The Company shall determine the currency and any applicable currency conversion rates to be applied.

The Grantee will personally be responsible for any local compliance requirements in relation to the transfer of U.S. dollars and the making of a foreign investment, if any. These requirements may change from time to time and the Company may at any time establish special terms and conditions to the exercise of the SARs and at any time may terminate or limit the availability of exercise, subject to applicable law.

Exhibit 10.6

The Company is not responsible for foreign exchange fluctuations between the Grantee’s local currency and the U.S. dollar nor is the Company liable for any decrease in the value of the Shares.

1. Expiration of SARs.

(a)The SARs shall expire or terminate and may not be exercised to any extent by the Grantee as of the first to occur of the following events:

(i)The tenth anniversary of the date of grant of the SAR Grant (the “Grant Date”), or such earlier time as the Company may determine is necessary or appropriate in light of applicable laws; or

(ii)The first anniversary of the date of the Grantee’s Separation from Service by reason of death or Disability; or

(iii)The third anniversary of the date of the Grantee’s Separation from Service by reason of Retirement; or

(iv)The date of the Grantee’s Separation from Service for Cause; or

(v)The date that is ninety days after Grantee’s Separation from Service for a reason other than for Cause, death, Disability or Retirement, but only to the extent the SARs are exercisable as of the date of such Separation from Service (with any unexercisable portion of the SAR Grant terminating on the date of any such Separation from Service); or

(vi)Except where void by law and unless otherwise determined by the Committee, the Grantee’s violation of any non-disclosure, non-compete or non-solicitation covenant applicable to the Grantee as set forth in Section 4 of this Agreement or in his or her severance, employment or similar contract or any Company policy, regardless of whether or not the Grantee has incurred a Separation from Service due to Disability, Retirement or otherwise.

(b)In the event of the Grantee’s Separation from Service because of death or Disability, the entire SAR Grant shall immediately become exercisable in full, notwithstanding Section 2(a) of this Agreement. In the event of the Grantee’s Separation from Service after the first anniversary of the Grant Date because of Retirement, the SAR Grant shall continue to vest according to the schedule as set forth in the Grantee’s grant notification.

(c)A paid or unpaid leave of absence of the Grantee that has been approved by the Company shall not constitute a Separation from Service of the Grantee. During such paid or unpaid leave of absence, the SAR Grant shall continue to vest according to the schedule set forth in the Grantee’s grant notification. For the avoidance of doubt, vesting of the SAR during any notice period relating to any termination of the Grantee’s employment by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause is determined under Section 6(j) of this Agreement.

(d)For purposes of this Agreement, the Grantee’s employment by a Subsidiary shall be considered a Separation from Service on the date on which such Subsidiary ceases to be a Subsidiary.

(e)Notwithstanding any other provision of this Agreement, in the event of a Change in Control, the vesting and payment of the SAR Grant shall be governed by the provisions of the Plan regarding a Change in Control, which are incorporated herein by reference.

2.Non-Competition/Non-Solicitation/Non-Disclosure.

The Grantee agrees that during the period beginning on the Grant Date and ending on the later of (x) the first anniversary of the date the SAR Grant is fully exercised and (y) the first anniversary of the Grantee’s Separation from Service with the Company (or, if applicable, a Subsidiary) for any reason whatsoever (including, but not limited to, with or without Cause, Retirement or Disability), he or she shall not, without the prior written consent of the Committee, engage in any of the following activities:

(a)directly or indirectly engage or otherwise participate in any business which is competitive with any significant business of the Company or any Subsidiary, including without limitation, the Grantee’s acceptance of employment with, entrance into a consulting or advisory

Exhibit 10.6

arrangement with, rendering services to or otherwise facilitating the business of Amway Corp./Alticor Inc., Amore Pacific, Arabela, Arbonne, Beiersdorf (Nivea), COTY, De Millus S.A., Ebel Int’l/Belcorp Corp., Elizabeth Arden, Faberlic, Herbalife Ltd., Inter Parfums, Jequiti, Lady Racine/LR Health & Beauty Systems GmbH, LG Health & Household, L’Occitane, L’Oréal Group/Cosmair Inc., Mary Kay Inc., Mistine/Better Way (Thailand) Co. Ltd., Natura Cosmetics S.A., Neways Int’l, NuSkin Enterprises Inc., O Boticário, Oriflame Cosmetics S.A., Origami Owl, Reckitt Benckiser PLC, Revlon Inc., Rodan & Fields, Shaklee Corp., Shiseido, Stella & Dot, Silpada, The Body Shop Int’l PLC, The Estée Lauder Companies Inc., The Procter & Gamble Company, Tupperware Corp., Unilever Group (N.V. and PLC), Vorwerk & Co. KG/Jafra Worldwide Holdings (Lux) S.à.R.L. Inc., Yanbal Int’l (Yanbal, Unique), Younique or any of their affiliates; or

(b)solicit or aid in the solicitation of any employees of the Company or any Subsidiary to leave their employment.

In addition, the Grantee shall not, unless compelled pursuant to an order of a court or other body having jurisdiction over such matter, communicate or divulge any secret or confidential information, knowledge or data, including without limitation any trade secrets, relating to the Company or a Subsidiary, and their respective businesses, obtained by the Grantee during his or her employment by the Company or a Subsidiary and which is not otherwise publicly known (other than by reason of an unauthorized act by the Grantee), to anyone other than the Company and those designated by it.

In the event the Company determines that the Grantee has breached any term of this Section 4 or any non-disclosure, non-compete or non-solicitation covenant set forth in his or her severance, employment or similar contract or any Company policy, then in addition to any other remedies the Company may have available to it, unless otherwise determined by the Committee: (y) all unexercised portions of the SAR Grant granted hereunder shall terminate to the extent the SAR Grant has not been exercised; and (z) if the SAR Grant has been exercised, the Grantee shall pay to the Company the net cash proceeds received in respect of such exercise.

Notwithstanding anything in this Section 4 to the contrary, this Agreement is not intended to, and shall be interpreted in a manner that does not, limit or restrict the Grantee from exercising any legally protected whistleblower rights (including pursuant to Rule 21F under the U.S. Securities Exchange Act of 1934).

3. Recoupment. Except where void by law and unless otherwise determined by the Company, the SAR Grant and any cash paid to the Grantee in connection with the exercise of the SAR Grant hereunder is subject to forfeiture and/or recoupment in the event that a Grantee has engaged in misconduct, including: (x) a serious violation of the Company’s Code of Conduct; or (y) a violation of law within the scope of employment with the Company and its Subsidiaries. All SARs and any payment made in respect of SARs hereunder are also subject to the Company’s Compensation Recoupment Policy.

4.Service Acknowledgements.

The Grantee acknowledges and agrees as follows:

(a)The execution and delivery of this Agreement and the granting of the SARs hereunder shall not constitute or be evidence of any agreement or understanding, express or implied, on the part of the Company or its Subsidiaries to employ the Grantee for any specific period.

(b)The award of the SARs is voluntary and occasional and does not entitle the Grantee to any benefit other than that specifically granted under this Agreement and under the Plan, or to any future awards or other benefits under the Plan or any similar plan, even if SARs have ever been granted in the

Exhibit 10.6

past or have repeatedly been granted in the past. Any benefits granted under this Agreement and under the Plan are extraordinary and not part of the Grantee’s ordinary or expected compensation or salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, end-of-service payments, bonuses, long-service awards, pension, welfare or retirement benefits or similar payments and in no event should be considered as compensation for, or relating in any way to, past services for the Company or any of its Subsidiaries. The Grantee understands and accepts that the benefits granted under the Plan are entirely at the grace and discretion of the Company and that the Company retains the right to amend or terminate the Plan, and/or the Grantee’s participation therein, at any time, at the Company’s sole discretion and without notice, subject to applicable law and the terms of the Plan.

(c)Nothing in this Agreement shall confer upon the Grantee any right to continue in the service of the Company or a Subsidiary or interfere in any way with any right of the Company or a Subsidiary to terminate the employment of the Grantee at any time, subject to applicable law.

(d)The Grantee is participating in the Plan, accepting the SARs and entering into this Agreement voluntarily.

(e)The Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, to the extent permitted by the Plan.

(f)All decisions with respect to future SARs or other grants, if any, will be at the sole discretion of the Company.

(g)The future value of the Shares underlying the SARs is unknown, indeterminable and cannot be predicted with certainty. The value of the Shares may increase or decrease.

(h)Neither the Company nor any Subsidiary is providing any tax, legal or financial advice or making any recommendations regarding this award or the Grantee’s participation in the Plan.

(i)In consideration of the grant of the SARs, (i) the Grantee shall have no claim or entitlement to compensation or damages arising from (x) forfeiture of the SARs resulting from termination of the Grantee’s service (for any reason whether or not in breach of local law) or otherwise pursuant to the terms of this Agreement or (y) diminution in value of the SARs or Shares covered thereby and (ii) the Grantee irrevocably releases the Company and its Subsidiaries from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by accepting the SARs, the Grantee shall be deemed irrevocably to have waived the Grantee’s entitlement to pursue such a claim.

(j)Any notice period mandated under applicable law or otherwise arising in connection with an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause shall be treated as service for the purpose of determining the vesting of the SARs. However, any notice period mandated under applicable law or otherwise for which the grantee receives pay in lieu of notice shall not be treated as service for purpose of determining the vesting of the SARs, and the Grantee’s right to vesting of SARs after Separation from Service, if any, will be measured by the date of termination of the Grantee’s active service and will not be extended by any such notice period. Similarly, if the Company elects to place the Grantee on garden leave during any notice period arising in connection with an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom the Grantee is employed) other than for Cause, such garden leave period shall not be treated as service for the purpose of determining the vesting of the SARs, and the Grantee’s right to settlement of the SARs after termination of service, if any, will be measured by the date of the termination of the Grantee’s active service (i.e., the commencement of such leave) and will not be extended by any such leave. Subject to the foregoing and the provisions of the Plan, the Company, in its sole discretion, shall determine whether the Grantee’s service has terminated and the effective date of such Separation from Service.

Exhibit 10.6

(k)The grant of the SARs will not be interpreted to form an employment contract or employment relationship with the Company or any of its Subsidiaries that does not otherwise exist.

5.Data Privacy Acknowledgement and Consent.

By signing this Agreement, the Grantee acknowledges and agrees that in order to implement, manage and administer this award and the Grantee’s participation in the Plan and/or in connection with tax or other governmental and regulatory compliance activities directly or indirectly related to the SAR Grant, the Company and/or an entity belonging to the Company’s group of companies (including the Grantee’s employer) may need to process the Grantee’s personal data (electronically or otherwise) including, but not limited to, the Grantee’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any Shares or other equity securities, directorships held in the Company, details of all SARs or any other entitlement to SARs awarded, canceled, vested, unvested or outstanding in the Grantee’s favor (the “Personal Data”). The transfer of Personal Data to and collection by third party service providers outside the Company’s group of companies, such as the Company’s authorized agent, may also be necessary in order to implement, manage and administer this award and the Plan.

The Grantee expressly and unambiguously consents to the collection, use and other processing of Personal Data by the Company, entities belonging to the Company’s group of companies, and third-party service providers. The Grantee understands that the Company may transfer the Grantee’s Personal Data to the United States, or other countries which may have a different or lower level of data protection law than the Grantee’s home country and which are not considered by the European Commission or the United Kingdom (should the United Kingdom cease to be a member of the European Economic Area (the “EEA”)) (if the Grantee is a resident of the United Kingdom or the EEA) or the data protection agencies of other jurisdictions to have data protection laws equivalent to the laws in the Grantee’s country. The Company will therefore maintain an EU-U.S. Privacy Shield certification or enter into an alternate data processing and transfer arrangement authorized by applicable law, such as Standard Contractual Clauses, to protect the Grantee’s Personal Data consistent with data protection laws of the European Union or the United Kingdom (should the United Kingdom cease to be a member of the EEA).

In addition, the Grantee expressly and unambiguously consents to the disclosure of Personal Data to, and processing by, a third-party in the event of any potential or actual reorganization, merger, sale, joint venture, assignment, transfer or other disposition of all or any portion of the Company’s business, assets or stock (including in connection with any bankruptcy or similar proceedings); and as the Company believes necessary or appropriate: (a) under applicable law, including laws outside of Grantee’s country; (b) to comply with legal processes; and (c) to respond to requests from public and government authorities including public and government authorities outside of Grantee’s country.

The Grantee authorizes the recipients to receive, possess, use, retain and transfer the Personal Data, in electronic or other form, for the purposes of implementing, managing and administering this SAR and the Grantee’s participation in the Plan, including any requisite transfer of such Personal Data as may be required to a broker or other third party with whom the Grantee may elect to deposit any amounts acquired upon exercise of the SARs. The Grantee understands that Personal Data will be held only as long as is necessary to implement, manage and administer this award and the Grantee’s participation in the Plan, unless a longer retention period is requiredby applicable laws, regulations, rules or valid requests or orders of a court or other dispute resolution forums or of a governmental or public authority, in each case, including those of a court or other dispute resolution forums or of a governmental or public authority outside of Grantee’s country. The Grantee understands that he or she may, at any time, view his or her Personal Data, request additional information about the storage and processing of his or her Personal Data, require any necessary amendments to his or her Personal Data that is incorrect or refuse or

Exhibit 10.6

withdraw the consents herein, in any case without cost, by contacting in writing the Grantee’s local stock program coordinator.

If the Grantee does not consent, or if the Grantee later seeks to revoke the Grantee’s consent, the Grantee’s employment status or career with the Company or Subsidiary will not be adversely affected; the only adverse consequence of refusing or withdrawing the Grantee’s consent is that the Company would not be able to grant SARs under the Plan or other equity awards, or manage or administer such awards. Therefore, the Grantee understands that refusing or withdrawing the Grantee’s consent may affect the Grantee’s ability to participate in the Plan. For more information on the consequences of the Grantee’s refusal to consent or withdrawal of consent, the Grantee understands that he or she may contact the Grantee’s local stock program coordinator.

If the Grantee is a resident of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA), his or her Personal Data will not be processed on the basis of consent (unless the Grantee provides a specific consent separate from this Section 7), but will be processed where necessary to fulfil the Company’s contractual obligations with the Grantee, where necessary to comply with the Company’s legal obligations under any applicable laws, or to meet the Company’s legitimate business interests. The Company has a legitimate interest in managing its business appropriately including incentivizing its employees, complying with its legal and contractual obligations, and keeping its records accurate and up to date. Grantees who are residents of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA) should refer to the Privacy Statement for Associates issued by his or her employer for additional information about the processing of the Grantee’s Personal Data and his or her privacy rights. The Privacy Statement for Associates will govern the processing of the Grantee’s Personal Data in connection with the administration of this award and the Grantee’s participation in the Plan.

The Company will take reasonable measures to keep the Personal Data private, confidential and accurate. The Grantee may obtain details with respect to the collection, use, processing and transfer of his or her Personal Data in relation to Plan participation and may also request a list with names and addresses of potential recipients of the Personal Data and/or access to and updates of such Personal Data, if needed, by contacting his or her local stock program coordinator.

6. Responsibility for Taxes.

By accepting this grant, the Grantee hereby irrevocably elects to satisfy any taxes and social insurance contribution withholding required to be withheld by the Company or its Subsidiaries on the date of grant, vesting or exercise of the SARs, subsequent cash payment, or on any earlier date on which such taxes or social insurance contribution withholding may be due (“Tax Liability”) by authorizing the Company and any of its Subsidiaries to withhold an amount of cash that would otherwise be deliverable to the Grantee hereunder sufficient to satisfy the Tax Liability. If, for any reason, the cash that would otherwise be deliverable to the Grantee upon exercise of the SARs would be insufficient to satisfy the Tax Liability, the Company and any of its Subsidiaries are authorized to withhold an amount from the Grantee’s wages or other compensation sufficient to satisfy the Tax Liability. Furthermore, the Grantee agrees to pay the Company or its Subsidiaries any amount of the Tax Liability that cannot be satisfied through one of the foregoing methods.

Apart from any withholding obligations that may apply to the Company and/or its Subsidiaries, the Grantee acknowledges and agrees that the ultimate responsibility for the Tax Liability is and remains with the Grantee. The Grantee further acknowledges that: (x) the Company and its Subsidiaries make no representations or undertakings regarding the Tax Liability; (y) the Company and its Subsidiaries do not

Exhibit 10.6

commit to structure the terms of the grant or any other aspect of the SAR Grant to reduce or eliminate the Tax Liability; and (z) the Grantee should consult a tax adviser regarding the Tax Liability.

The Grantee acknowledges that he or she may not participate in the Plan and the Company and its Subsidiaries shall have no obligation to make the cash payment hereunder until the Tax Liability has been fully satisfied by the Grantee.

Exhibit 10.6

7. Notice. Any notice required to be given hereunder to the Grantee shall be addressed to the Grantee at his or her current address shown on the Company’s records. Notice shall be sent by mail, express delivery or, if practical, by electronic delivery or hand delivery.

Exhibit 10.6

8.Incorporation of SAR-Related Plan Provisions. The provisions set forth in the Plan relating to SARs are specifically incorporated by reference in this Agreement.

9.Provisions Inconsistent with Translation. To the extent that the Grantee has been provided with a translation of this Agreement, the English language version of this Agreement shall prevail in case of any discrepancies or ambiguities due to translation.

10.Acknowledgment. The Company and the Grantee agree that the SAR Grant granted under, and governed by, the Grantee’s grant notification, this Agreement and the Plan. The Grantee: (x) acknowledges receipt of a copy of such grant notification, this Agreement, the Plan and the prospectus relating to the Plan; (y) represents that the Grantee has carefully read and is familiar with their provisions; and (z) hereby accepts the SAR Grant subject to all of the terms and conditions set forth in the Grantee’s grant notification, this Agreement and the Plan.

11.Compliance with Laws and Regulations. The granting of the SARs and any payment made hereunder shall be subject to all applicable laws, rules and regulations.The issuance of any amounts under this Agreement will be subject to and conditioned upon compliance by the Company and the Grantee with all applicable laws and regulations and with all applicable requirements of any stock exchange or automated quotation system on which the Shares may be listed or quoted at the time of such issuance or transfer. If any provision of this Agreement conflicts with applicable mandatory law, the provisions of such law shall govern.

12.Additional Conditions to Issuance of Shares or Exercise.If at any time the Company determines, in its discretion, that as a condition to the issuance of Shares or payment in lieu thereof to the Grantee (or the Grantee’s estate) hereunder, it is necessary or desirable to (i) list, register, qualify or comply with the rules of any securities exchange, (ii) qualify or comply with any applicable state, federal or foreign law, including the applicable tax code and related regulations, or (iii) obtain the consent or approval of any governmental regulatory authority or securities exchange, then such issuance will not occur unless and until such listing, registration, qualification, rule compliance, consent or approval is completed, effected or obtained free of any conditions not acceptable to the Company. Where the Company determines that the delivery of Shares or payment in lieu thereof hereunder will violate federal securities laws or other applicable law, the Company will defer delivery until the earliest date on which the Company reasonably anticipates that the delivery of Shares or payment in lieu thereof hereunder will no longer cause such violation. The Company will make all reasonable efforts to meet the requirements of any such state, federal or foreign law or securities exchange and to obtain any such consent or approval of any such governmental authority or securities exchange.

13.Foreign Exchange. Where applicable, the Grantee acknowledges and agrees that it is the Grantee’s sole responsibility to investigate and comply with any applicable exchange control laws in connection with the delivery of amounts under this Agreement and that the Grantee shall be responsible for any reporting of inbound international fund transfers required under applicable law. The Grantee is advised to seek appropriate professional advice as to how the exchange control regulations apply to the Grantee’s specific situation. The Grantee acknowledges and agrees that neither the Company nor any Subsidiary shall be liable for any foreign exchange rate fluctuation between the Grantee’s local currency and the U.S. Dollar that may affect the value of the SARs or of any amounts due to the Grantee pursuant to the exercise of the SARs.

14.Miscellaneous. The Company at any time, and from time to time, may amend the terms of this Agreement; provided, however, that the rights of the Grantee shall not be materially adversely affected without the Grantee’s written consent (except to the extent permitted under the Plan). No waiver by either party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, and each other provision of this Agreement shall be severable and enforceable to the extent permitted by law. For the avoidance of

Exhibit 10.6

doubt, any exercise with respect to any fractional Shares resulting from an adjustment of the SAR Grant pursuant to Section 9 of the Plan or otherwise shall be payable in cash in an amount equal to the Fair Market Value of such fractional Share. The terms of this Agreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and to the benefit of the Grantee and the Grantee’s beneficiaries, executors, administrators, heirs and successors. The headings of the Sections hereof are provided for convenience only and are not to serve as a basis for interpretation or construction, and shall not constitute a part, of this Agreement.

15.Entire Agreement. This Agreement (including Appendix A), the Plan and the Grantee’s grant notification contain the entire agreement and understanding of the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations and negotiations in respect thereto.

16.Applicable Law. This Agreement (including Appendix A), the Plan and the Grantee’s grant notification, and all actions taken hereunder or under the Plan, shall be governed by, and construed in accordance with, the laws of the State of New York without regard to the conflict of law principles thereof.

17.Electronic Delivery and Acceptance. The Company may, in its sole discretion, decide to deliver any documents related to the SAR Grant or future SARs that may be awarded under the Plan by electronic means, or request the Grantee’s consent to participate in the Plan by electronic means. Such means of electronic delivery may include, but do not necessarily include, the delivery of a link to a Company intranet or the Internet site of a third party involved in administering this award or the Plan, the delivery of the document via electronic mail or such other means of electronic delivery specified by the Company. The Grantee consents to the electronic delivery of the Plan documents (including the prospectus relating to the Plan) and this Agreement. The Grantee acknowledges that he or she may receive from the Company a paper copy of any documents delivered electronically at no cost to the Grantee by contacting the Company by telephone or in writing. The Grantee further acknowledges that the Grantee will be provided with a paper copy of any documents if the attempted electronic delivery of such documents fails. Similarly, the Grantee understands that the Grantee must provide the Company or any designated third party administrator with a paper copy of any documents if the attempted electronic delivery of such documents fails. The Grantee may revoke his or her consent to the electronic delivery of documents or may change the electronic mail address to which such documents are to be delivered (if the Grantee has provided an electronic mail address) at any time by notifying the Company of such revoked consent or revised electronic mail address by telephone, postal service or electronic mail. Finally, the Grantee understands that he or she is not required to consent to electronic delivery of documents.

18.No Advice Regarding Grant. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations or assessments regarding the Grantee’s acceptance of this award, participation in the Plan, or acquisition or sale of the underlying Shares. The Grantee is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her acceptance of this award and participation in the Plan before taking any action related to the Plan.

19.Counterparts. This Agreement may be executed in one or more counterparts (including via facsimile and electronic image scan (pdf)), each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument and shall become effective when one or more counterparts have been signed by each party and delivered to the other party.

20.Appendix. Notwithstanding any provisions in this Agreement, the SARs shall be subject to any special terms, conditions or notifications set forth in Appendix A to this Agreement for the Grantee’s country, which shall constitute part of this Agreement. Moreover, if the Grantee relocates to one of the countries included in Appendix A, the special terms and conditions for such country will apply to the Grantee, to the extent the Company determines that the application of such terms and conditions is necessary or advisable in order to comply with local law or facilitate the administration of the Plan.

Exhibit 10.6

[Signatures on Next Page]

IN WITNESS WHEREOF, the Company, by its duly authorized officer, and the Grantee have executed this Agreement as of the Grant Date.

By the Grantee’s acceptance of this Agreement, the Grantee and the Company agree that the SARs are granted under and governed by the terms and conditions of the Plan, the Grantee’s grant notification and this Agreement. The Grantee has reviewed the Plan, the Plan prospectus, the Grantee’s grant notification and this Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Agreement, and fully understands all provisions of the Plan, the Plan prospectus, the Grantee’s grant notification and this Agreement. The Grantee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions relating to the Plan, the Plan prospectus, the Grantee’s grant notification and this Agreement. The Grantee further agrees to notify the Company upon any change in Grantee’s residence address.

AVON PRODUCTS, INC. GRANTEE

_________________________ Chief Executive Officer _________________________ Name:

APPENDIX A

ADDITIONAL TERMS AND CONDITIONS OF

INTERNATIONAL STOCK APPRECIATION RIGHT

UNDER THE

AVON PRODUCTS, INC. 2016 OMNIBUS INCENTIVE PLAN

NON-U.S. EMPLOYEES

This Appendix includes additional terms and conditions that govern the SARs granted to the Grantee under the Plan if the Grantee resides in one of the countries listed below. Capitalized terms used but not defined in this Appendix have the meanings set forth in the Plan and/or the Agreement.

The Grantee understands and agrees that the Company strongly recommends that the Grantee not rely on the information herein as the only source of information relating to the consequences of participation in the Plan because applicable rules and regulations regularly change, sometimes on a retroactive basis, and the information may be out of date at the time the SARs vest or are exercised.

The Grantee further understands and agrees that if the Grantee is a citizen or resident of a country other than the one in which the Grantee is currently working, transfers employment after grant of the SARs, or is considered a resident of another country for local law purposes, the information contained herein may not apply to the Grantee, and the Company shall, in its discretion, determine to what extent the terms and

Exhibit 10.6

conditions contained herein shall apply or determine that other terms and conditions are necessary or advisable in order to comply with local law or to facilitate the administration of the Agreement.

Russia

U.S. Transaction and Sale Restrictions

The Grantee understands that acceptance of the grant of the SARs results in a contract between the Grantee and the Company completed in the United States and that the Agreement is governed by its applicable laws. Upon vesting and exercise of the SARs, any payment to be made to the Grantee shall be delivered to him or her through a bank or brokerage account in the United States. The Grantee is not permitted to transfer the SARs to Russian legal entities or individuals nor is the Grantee permitted to bring any financial instrument under the Plan into Russia.

Securities Law Notification

The Agreement, the Plan and all other materials that Grantee may receive regarding participation in the Plan do not constitute advertising or an offering of securities in Russia. Absent any requirement under local law, the issuance of securities pursuant to the Plan has not and will not be registered in Russia; hence, the securities described in any Plan-related documents may not be used for offering or public circulation in Russia.

Exchange Control Information

Under current exchange control regulations, within a reasonably short time after cash payment under the Plan or the receipt of dividends (if any), the Grantee must repatriate the proceeds to Russia. Such proceeds must initially be credited to the Grantee through a foreign currency account at an authorized bank in Russia. After the proceeds are initially received in Russia, they may be further remitted to foreign banks in accordance with Russian exchange control laws. The Grantee is encouraged to contact his or her personal advisor before remitting his or her proceeds to Russia as exchange control requirements may change at any time, often with little or no notice.

South Africa

Exchange Control Information

Employees may need to file notification of participation with exchange control authorities. An annual investment limit may apply to employees even if notification has been filed. Because the exchange control regulations are subject to change, the Grantee should consult a personal advisor prior to vesting and exercise of the SARs to ensure compliance with current regulations. In addition, South African residents may be required to obtain approval from the South African Reserve Bank for payments that he or she receives into accounts held outside of South Africa (e.g., a U.S. brokerage account). The Grantee is responsible for ensuring compliance with all exchange control laws in South Africa.

EX-10.7

Exhibit 10.7

AVON PRODUCTS, INC.

2016 OMNIBUS INCENTIVE PLAN

STOCK OPTION AGREEMENT

1. Grant of Option. Pursuant to the provisions of its 2016 Omnibus Incentive Plan (as amended and restated from time to time, the “Plan”), Avon Products, Inc. (the “Company”) has granted to you (the “Optionee”) the right and option to purchase from the Company shares of Stock (“Shares”) at an exercise price per Share (the “Exercise Price”) as set forth in the Optionee’s grant notification (the “Option”). The Option is subject to the terms and conditions set forth below, as well as those terms and conditions set forth in the Plan, all of which are hereby incorporated by reference. All capitalized terms used in this Stock Option Agreement (this “Agreement”) shall have the meaning set forth in the Plan, unless otherwise defined herein.

2.Exercise of Option.

(a)The Option shall be exercisable in the installments outlined in the Optionee’s grant notification. The entire Option is fully exercisable after the final vesting date. To the extent that any of the installments becomes exercisable, it shall continue to be exercisable at any time thereafter until the Option shall terminate, expire or be surrendered.

(b)Shares may be purchased through exercise of the Option by contacting the Company’s authorized agent: (x) on-line; (y) via the telephone; or (z) through a broker.

The Optionee shall designate one, or a combination, of the following methods of purchase:

(i)tender to the Company’s authorized agent of a check for the full Exercise Price of the Shares with respect to which the Option or portion thereof is exercised; or

(ii)by delivery to the Company’s authorized agent of a number of Shares (which may include an attestation of ownership of such Shares) having an aggregate Fair Market Value of not less than the product of (x) the Exercise Price multiplied by (y) the number of Shares the Optionee intends to purchase upon exercise of the Option on the date of delivery; or

(iii)instructions to the Company’s authorized agent that Shares acquired as a result of the Option exercise be immediately sold and that the Company’s authorized agent deliver the full Exercise Price to the Company, together with any tax withholdings, whereupon the net cash proceeds and/or Shares shall be forwarded to the Optionee. The Company may establish special terms and conditions for this “cashless” exercise and at any time may terminate availability of this form of purchase.

The Optionee should be aware that the exercise method as outlined under Section 2(b)(i) and (ii) will result, and the exercise method as outlined under Section 2(b)(iii) may result, in the ownership of Shares and may also require the exchange of local currency into U.S. dollars and

Exhibit 10.7

the transfer of funds to the U.S. In addition, the Optionee will be required to open and use a U.S. based brokerage account. The Optionee will personally be responsible for any local compliance requirements in relation to all of the above transactions.

Moreover, the Optionee should be aware that regardless of the exercise method used, the Optionee will personally be responsible for any local compliance requirements in relation to the transfer of U.S. dollars and the making of a foreign investment, if any. These requirements may change from time to time and the Company may at any time establish special terms and conditions to the exercise of the Option and at any time may terminate or limit the availability of any form of exercise as outlined above, subject to applicable law.

The Company is not responsible for foreign exchange fluctuations between the Optionee’s local currency and the U.S. dollar nor is the Company liable for any decrease in the value of the Shares.

1. Expiration of Option.

(a)The Option shall expire or terminate and may not be exercised to any extent by the Optionee as of the first to occur of the following events:

(i)The tenth anniversary of the date of grant of this Option (the “Grant Date”), or such earlier time as the Company may determine is necessary or appropriate in light of applicable laws; or

(ii)The first anniversary of the date of the Optionee’s Separation from Service by reason of death or Disability; or

(iii)The third anniversary of the date of the Optionee’s Separation from Service by reason of Retirement; or

(iv)The date of the Optionee’s Separation from Service for Cause; or

(v)The date that is ninety days after Separation from Service of the Optionee for a reason other than for Cause, death, Disability or Retirement, but only to the extent the Option is exercisable as of the date of such Separation from Service (with any unexercisable portion of the Option terminating on the date of any such Separation from Service); or

(vi)Except where void by law and unless otherwise determined by the Committee, the Optionee’s violation of any non-disclosure, non-compete or non-solicitation covenant applicable to the Optionee as set forth in Section 5 of this Agreement or in his or her severance, employment or similar contract or any Company policy, regardless of whether or not the Optionee has incurred a Separation from Service due to Disability, Retirement or otherwise.

(b)In the event of the Optionee’s Separation from Service because of death or Disability, the entire Option shall immediately become exercisable in full, notwithstanding Section 2(a) of this Agreement. In the event of the Optionee’s Separation from Service after the first anniversary of the Grant Date because of Retirement, the Option shall continue to vest according to the schedule as set forth in the Optionee’s grant notification.

(c)A paid or unpaid leave of absence of the Optionee that has been approved by the Company shall not constitute a Separation from Service of the Optionee. During such paid or unpaid leave of absence, the Option shall continue to vest according to the schedule set forth in the Optionee’s grant notification. For the avoidance of doubt, vesting of the Option during any notice period relating to any termination of the Optionee’s employment by the Company (and, if applicable, by any Subsidiary for whom the Optionee is employed) other than for Cause is determined under Section 7(j) of this Agreement.

(d)For purposes of this Agreement, the Optionee’s employment by a Subsidiary shall be considered a Separation from Service on the date on which such Subsidiary ceases to be a Subsidiary.

Exhibit 10.7

2.Change in Control. Notwithstanding any other provision of this Agreement, in the event of a Change in Control, the vesting and exercise of the Option shall be governed by the provisions of the Plan regarding a Change in Control, which are incorporated herein by reference.

3.Non-Competition/Non-Solicitation/Non-Disclosure. The Optionee agrees that, during the period beginning on the Grant Date and ending on the later of (x) the first anniversary of the date the Option is fully exercised and (y) the first anniversary of the Optionee’s Separation from Service with the Company (or, if applicable, a Subsidiary) for any reason whatsoever (including, but not limited to, with or without Cause, Retirement or Disability), he or she shall not, without the prior written consent of the Committee, engage in any of the following activities:

(a)directly or indirectly engage or otherwise participate in any business which is competitive with any significant business of the Company or any Subsidiary, including without limitation, the Optionee’s acceptance of employment with, entrance into a consulting or advisory arrangement with, rendering services to or otherwise facilitating the business of Amway Corp./Alticor Inc., Amore Pacific, Arabela, Arbonne, Beiersdorf (Nivea), COTY, De Millus S.A., Ebel Int’l/Belcorp Corp., Elizabeth Arden, Faberlic, Herbalife Ltd., Inter Parfums, Jequiti, Lady Racine/LR Health & Beauty Systems GmbH, LG Health & Household, L’Occitane, L’Oréal Group/Cosmair Inc., Mary Kay Inc., Mistine/Better Way (Thailand) Co. Ltd., Natura Cosmetics S.A., Neways Int’l, NuSkin Enterprises Inc., O Boticário, Oriflame Cosmetics S.A., Origami Owl, Reckitt Benckiser PLC, Revlon Inc., Rodan & Fields, Shaklee Corp., Shiseido, Stella & Dot, Silpada, The Body Shop Int’l PLC, The Estée Lauder Companies Inc., The Procter & Gamble Company, Tupperware Corp., Unilever Group (N.V. and PLC), Vorwerk & Co. KG/Jafra Worldwide Holdings (Lux) S.à.R.L. Inc., Yanbal Int’l (Yanbal, Unique), Younique or any of their affiliates; or

(b)solicit or aid in the solicitation of any employees of the Company or any Subsidiary to leave their employment.

In addition, the Optionee shall not, unless compelled pursuant to an order of a court or other body having jurisdiction over such matter, communicate or divulge any secret or confidential information, knowledge or data, including without limitation any trade secrets, relating to the Company or a Subsidiary, and their respective businesses, obtained by the Optionee during his or her employment by the Company or a Subsidiary and which is not otherwise publicly known (other than by reason of an unauthorized act by the Optionee), to anyone other than the Company and those designated by it.

In the event the Company determines that the Optionee has breached any term of this Section 5 or any non--disclosure, non-compete or non-solicitation covenant set forth in his or her severance, employment or similar contract or any Company policy, then in addition to any other remedies the Company may have available to it, unless otherwise determined by the Committee: (i) all unexercised portions of the Option granted hereunder shall terminate to the extent the Option has not been exercised and (ii) if the Option has been exercised, then the Optionee shall forfeit all Shares issued to the Optionee in connection with the exercise of the Option; provided, however, that the Company shall return to the Optionee the lesser of any consideration paid by the Optionee in exchange for Shares issued to the Optionee hereunder or the Fair Market Value of Shares forfeited hereunder at the time of forfeiture; and provided, further, that if the Optionee no longer holds Shares issued to the Optionee hereunder, then the Optionee shall pay to the Company in cash the excess of the Fair Market Value of the Shares issued to the Optionee upon exercise of the Option, determined as of the date of such exercise, over any consideration paid by the Optionee in exchange for such Shares.

Notwithstanding anything in this Section 5 to the contrary, this Agreement is not intended to, and shall be interpreted in a manner that does not, limit or restrict the Optionee from exercising any legally protected whistleblower rights (including pursuant to Rule 21F under the U.S. Securities Exchange Act of 1934).

Exhibit 10.7

4. Recoupment. Except where void by law and unless otherwise determined by the Company, the Option, and the Shares issued to the Optionee in connection with the exercise of the Option hereunder, are subject to forfeiture and/or recoupment in the event that the Optionee has engaged in misconduct, including: (x) a serious violation of the Company’s Code of Conduct; or (y) a violation of law within the scope of employment with the Company and its Subsidiaries. The Option and any Shares issued to the Optionee in connection with the exercise of the Option hereunder are also subject to the Company’s Compensation Recoupment Policy.

5.Service Acknowledgements. The Optionee acknowledges and agrees as follows:

(a)The execution and delivery of this Agreement and the granting of the Option hereunder shall not constitute or be evidence of any agreement or understanding, express or implied, on the part of the Company or its Subsidiaries to employ the Optionee for any specific period.

(b)The award of the Option is voluntary and occasional and does not entitle the Optionee to any benefit other than that specifically granted under this Agreement and under the Plan, or to any future awards or other benefits under the Plan or any similar plan, even if Options have ever been granted in the past or have repeatedly been granted in the past. Any benefits granted under this Agreement and under the Plan are extraordinary and not part of the Optionee’s ordinary or expected compensation or salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, end-of-service payments, bonuses, long-service awards, pension, welfare or retirement benefits or similar payments and in no event should be considered as compensation for, or relating in any way to, past services for the Company or any of its Subsidiaries. The Optionee understands and accepts that the benefits granted under the Plan are entirely at the grace and discretion of the Company and that the Company retains the right to amend or terminate the Plan, and/or the Optionee’s participation therein, at any time, at the Company’s sole discretion and without notice, subject to applicable law and the terms of the Plan.

(c)Nothing in this Agreement shall confer upon the Optionee any right to continue in the service of the Company or a Subsidiary or interfere in any way with any right of the Company or a Subsidiary to terminate the employment of the Optionee at any time, subject to applicable law.

(d)The Optionee is participating in the Plan, accepting the Option and entering into this Agreement voluntarily.

(e)The Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, to the extent permitted by the Plan.

(f)All decisions with respect to future options or other grants, if any, will be at the sole discretion of the Company.

(g)The future value of the Shares underlying the Option is unknown, indeterminable and cannot be predicted with certainty. The value of the Shares may increase or decrease.

(h)Neither the Company nor any Subsidiary is providing any tax, legal or financial advice or making any recommendations regarding this award, the Optionee’s participation in the Plan, or the Optionee’s acquisition or sale of the Shares.

(i)In consideration of the grant of the Option, (i) the Optionee shall have no claim or entitlement to compensation or damages arising from (x) forfeiture of the Option resulting from termination of the Optionee’s service (for any reason whether or not in breach of local law) or otherwise pursuant to the terms of this Agreement or (y) diminution in value of the Option or Shares issued upon exercise of the Option and (ii) the Optionee irrevocably releases the Company and its Subsidiaries from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by accepting the Option, the Optionee shall be deemed irrevocably to have waived the Optionee’s entitlement to pursue such a claim.

(j)Any notice period mandated under applicable law or otherwise arising in connection with an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom

Exhibit 10.7

the Optionee is employed) other than for Cause shall be treated as service for the purpose of determining the vesting of the Option. However, any notice period mandated under applicable law or otherwise for which the Optionee receives pay in lieu of notice shall not be treated as service for purpose of determining the vesting of the Options, and the Optionee’s right to vesting of the Option after Separation from Service, if any, will be measured by the date of termination of the Optionee’s active service and will not be extended by any such notice period. Similarly, if the Company elects to place the Optionee on garden leave (or the equivalent) during any notice period arising in connection with an involuntary Separation from Service by the Company (and, if applicable, by any Subsidiary for whom the Optionee is employed) other than for Cause, such garden leave period shall not be treated as service for the purpose of determining the vesting of the Options, and the Optionee’s right to settlement of the Option after termination of service, if any, will be measured by the date of termination of the Optionee’s active service (i.e., the commencement of such leave) and will not be extended by any such leave. Subject to the foregoing and the provisions of the Plan, the Company, in its sole discretion, shall determine whether the Optionee’s service has terminated and the effective date of such Separation from Service.

(k)The grant of the Option will not be interpreted to form an employment contract or employment relationship with the Company or any of its Subsidiaries that does not otherwise exist.

6.Data Privacy Acknowledgement and Consent. By signing this Agreement, the Optionee acknowledges and agrees that in order to implement, manage and administer the Option and the Optionee’s participation in the Plan and/or in connection with tax or other governmental and regulatory compliance activities directly or indirectly related to the Option, the Company and/or an entity belonging to the Company’s group of companies (including the Optionee’s employer) may need to process the Optionee’s personal data (electronically or otherwise) including, but not limited to, the Optionee’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any Shares or other equity securities, directorships held in the Company, details of all Options or any other entitlement to Shares awarded, canceled, vested, unvested or outstanding in the Optionee’s favor (the “Personal Data”). The transfer of Personal Data to and collection by third party service providers outside the Company’s group of companies, such as the Company’s authorized agent, may also be necessary in order to implement, manage and administer the Option and the Plan.

The Optionee expressly and unambiguously consents to the collection, use and other processing of Personal Data by the Company, entities belonging to the Company’s group of companies, and third-party service providers. The Optionee understands that the Company may transfer the Optionee’s Personal Data to the United States, or other countries which may have a different or lower level of data protection law than the Optionee’s home country and which are not considered by the European Commission or the United Kingdom (should the United Kingdom cease to be a member of the European Economic Area (the “EEA”)) (if the Optionee is a resident of the United Kingdom or the EEA) or the data protection agencies of other jurisdictions to have data protection laws equivalent to the laws in the Optionee’s country. The Company will therefore maintain an EU-U.S. Privacy Shield certification or enter into an alternate data processing and transfer arrangement authorized by applicable law, such as Standard Contractual Clauses, to protect the Optionee’s Personal Data consistent with data protection laws of the European Union or the United Kingdom (should the United Kingdom cease to be a member of the EEA).

In addition, the Optionee expressly and unambiguously consents to the disclosure of Personal Data to, and processing by, a third party in the event of any potential or actual reorganization, merger, sale, joint venture, assignment, transfer or other disposition of all or any portion of the Company’s business, assets or stock (including in connection with any bankruptcy or similar proceedings); and as the Company believes necessary or appropriate: (a) under applicable law, including laws outside of the Optionee’s country; (b) to comply with legal processes; and (c) to respond to requests from public and government authorities including public and government authorities outside of the Optionee’s country.

Exhibit 10.7

The Optionee authorizes the recipients to receive, possess, use, retain and transfer the Personal Data, in electronic or other form, for the purposes of implementing, managing and administering this Option and the Optionee’s participation in the Plan, including any requisite transfer of such Personal Data as may be required to a broker or other third party with whom the Optionee may elect to deposit any Shares acquired upon exercise of the Option. The Optionee understands that Personal Data will be held only as long as is necessary to implement, manage and administer the Option and the Optionee’s participation in the Plan, unless a longer retention period is required by applicable laws, regulations, rules or valid requests or orders of a court or other dispute resolution forums or of a governmental or public authority, in each case, including those of a court or other dispute resolution forums or of a governmental or public authority outside of the Optionee’s country. The Optionee understands that he or she may, at any time, view his or her Personal Data, request additional information about the storage and processing of his or her Personal Data, require any necessary amendments to his or her Personal Data that is incorrect or refuse or withdraw the consents herein, in any case without cost, by contacting in writing the Optionee’s local stock program coordinator.

If the Optionee does not consent, or if the Optionee later seeks to revoke the Optionee’s consent, the Optionee’s employment status or career with the Company or Subsidiary will not be adversely affected; the only adverse consequence of refusing or withdrawing the Optionee’s consent is that the Company would not be able to grant options under the Plan or other equity awards, or manage or administer such awards. Therefore, the Optionee understands that refusing or withdrawing the Optionee’s consent may affect the Optionee’s ability to participate in the Plan. For more information on the consequences of the Optionee’s refusal to consent or withdrawal of consent, the Optionee understands that he or she may contact the Optionee’s local stock program coordinator.

If the Optionee is a resident of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA), his or her Personal Data will not be processed on the basis of consent (unless the Optionee provides a specific consent separate from this Section 8), but will be processed where necessary to fulfil the Company’s contractual obligations with the Optionee, where necessary to comply with the Company’s legal obligations under any applicable laws, or to meet the Company’s legitimate business interests. The Company has a legitimate interest in managing its business appropriately including incentivizing its employees, complying with its legal and contractual obligations, and keeping its records accurate and up to date. Optionees who are residents of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA) should refer to the Privacy Statement for Associates issued by his or her employer for additional information about the processing of the Optionee’s Personal Data and his or her privacy rights. The Privacy Statement for Associates will govern the processing of the Optionee’s Personal Data in connection with the administration of this award and the Optionee’s participation in the Plan.

The Company will take reasonable measures to keep the Personal Data private, confidential and accurate. The Optionee may obtain details with respect to the collection, use, processing and transfer of his or her Personal Data in relation to Plan participation and may also request a list with names and addresses of potential recipients of the Personal Data and/or access to and updates of such Personal Data, if needed, by contacting his or her local stock program coordinator.

7. Responsibility for Taxes. By accepting this grant, the Optionee hereby irrevocably elects to satisfy any taxes and social insurance contribution withholding required to be withheld by the Company or its Subsidiaries on the date of grant, vesting or exercise of the Option or delivery or sale of any Shares hereunder or on any earlier date on which such taxes or social insurance

Exhibit 10.7

contribution withholding may be due (“Tax Liability”) by authorizing the Company and any of its Subsidiaries to withhold a sufficient number of Shares that would otherwise be deliverable to the Optionee upon exercise of the Option. If, for any reason, the Shares that would otherwise be deliverable to the Optionee upon exercise of the Option would be insufficient to satisfy the Tax Liability, the Company and any of its Subsidiaries are authorized to withhold an amount from the Optionee’s wages or other compensation sufficient to satisfy the Tax Liability. Furthermore, the Optionee agrees to pay the Company or its Subsidiaries any amount of the Tax Liability that cannot be satisfied through one of the foregoing methods.

Apart from any withholding obligations that may apply to the Company and/or its Subsidiaries, the Optionee acknowledges and agrees that the ultimate responsibility for the Tax Liability is and remains with the Optionee. The Optionee further acknowledges that: (x) the Company and its Subsidiaries make no representations or undertakings regarding the Tax Liability or the receipt of any dividends; (y) the Company and its Subsidiaries do not commit to structure the terms of the grant or any other aspect of the Option to reduce or eliminate the Tax Liability; and (z) the Optionee should consult a tax adviser regarding the Tax Liability.

The Optionee acknowledges that he or she may not participate in the Plan and the Company and its Subsidiaries shall have no obligation to deliver Shares until the Tax Liability has been fully satisfied by the Optionee.

It is recognized by both parties that, based on current U.S. laws, the difference between the Fair Market Value of the Shares purchased upon exercise of the Option and the Exercise Price of such Shares generally will constitute ordinary taxable income for U.S. federal income and social security tax purposes and for most state and local income tax purposes.

8. Notice. Any notice required to be given hereunder to the Optionee shall be addressed to the Optionee at his or her current address shown on the Company’s records. Notice shall be sent by mail, express delivery or, if practical, by electronic delivery or hand delivery.

9.Provisions Inconsistent with Translation. To the extent that the Optionee has been provided with a translation of this Agreement, the English language version of this Agreement shall prevail in case of any discrepancies or ambiguities due to translation.

10.Acknowledgement. The Company and the Optionee agree that the Option is granted under, and governed by, the Optionee’s grant notification, this Agreement and the Plan. The Optionee: (x) acknowledges receipt of a copy of such grant notification, this Agreement, the Plan and the prospectus relating to the Plan; (y) represents that the Optionee has carefully read and is familiar with their provisions; and (z) hereby accepts the Option subject to all of the terms and conditions set forth in the Optionee’s grant notification, this Agreement and the Plan.

11.Compliance with Laws and Regulations. The granting of the Option and the delivery of Shares hereunder shall be subject to all applicable laws, rules and regulations. The issuance of Shares will be subject to and conditioned upon compliance by the Company and the Optionee with all applicable laws and regulations and with all applicable requirements of any stock exchange or automated quotation system on which the Shares may be listed or quoted at the time of such issuance or transfer. If any provision of this Agreement conflicts with applicable mandatory law, the provisions of such law shall govern.

12.Additional Conditions to Issuance of Shares or Exercise. If at any time the Company determines, in its discretion, that as a condition to the issuance of Shares to the Optionee (or the Optionee’s estate) hereunder, it is necessary or desirable to (i) list, register, qualify or comply with the rules of any securities exchange, (ii) qualify or comply with any applicable state, federal or foreign law, including the applicable tax code and related regulations, or (iii) obtain the consent or approval of any governmental regulatory authority or securities exchange, then such issuance will not occur unless and

Exhibit 10.7

until such listing, registration, qualification, rule compliance, consent or approval is completed, effected or obtained free of any conditions not acceptable to the Company. Where the Company determines that the delivery of Shares hereunder will violate federal securities laws or other applicable law, the Company will defer delivery until the earliest date on which the Company reasonably anticipates that the delivery of Shares hereunder will no longer cause such violation. The Company will make all reasonable efforts to meet the requirements of any such state, federal or foreign law or securities exchange and to obtain any such consent or approval of any such governmental authority or securities exchange.

13.Foreign Exchange. Where applicable, the Optionee acknowledges and agrees that it is the Optionee’s sole responsibility to investigate and comply with any applicable exchange control laws in connection with the issuance and delivery of Shares pursuant to the exercise of the Option and that the Optionee shall be responsible for any reporting of inbound international fund transfers required under applicable law. The Optionee is advised to seek appropriate professional advice as to how the exchange control regulations apply to the Optionee’s specific situation. The Optionee acknowledges and agrees that neither the Company nor any Subsidiary shall be liable for any foreign exchange rate fluctuation between the Optionee’s local currency and the U.S. Dollar that may affect the value of the Option or of any amounts due to the Optionee pursuant to the exercise of the Option or the subsequent sale of any Shares acquired upon exercise.

14.Miscellaneous. The Company at any time, and from time to time, may amend the terms of this Agreement; provided, however, that the rights of the Optionee shall not be materially adversely affected without the Optionee’s written consent (except to the extent permitted under the Plan). No waiver by either party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, and each other provision of this Agreement shall be severable and enforceable to the extent permitted by law. In lieu of issuing a fraction of a Share resulting from an adjustment of the Option pursuant to Section 9 of the Plan or otherwise, the Company shall be entitled to pay to the Optionee an amount equal to the Fair Market Value of such fractional Share. The terms of this Agreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and to the benefit of the Optionee and the Optionee’s beneficiaries, executors, administrators, heirs and successors. The headings of the Sections hereof are provided for convenience only and are not to serve as a basis for interpretation or construction, and shall not constitute a part, of this Agreement.

15.Entire Agreement. This Agreement (including Appendix A), the Plan and the Optionee’s grant notification contain the entire agreement and understanding of the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations and negotiations in respect thereto.

16.Applicable Law. This Agreement (including Appendix A), the Plan and the Optionee’s grant notification, and all actions taken hereunder or under the Plan, shall be governed by, and construed in accordance with, the laws of the State of New York without regard to the conflict of law principles thereof.

17.Electronic Delivery and Acceptance. The Company may, in its sole discretion, decide to deliver any documents related to the Option or future options that may be awarded under the Plan by electronic means, or request the Optionee’s consent to participate in the Plan by electronic means. Such means of electronic delivery may include, but do not necessarily include, the delivery of a link to a Company intranet or the Internet site of a third party involved in administering this award or the Plan, the delivery of the document via electronic mail or such other means of electronic delivery specified by the Company. The Optionee consents to the electronic delivery of the Plan documents (including the prospectus relating to the Plan) and this Agreement. The Optionee acknowledges that he or she may receive from the Company a paper copy of any documents delivered electronically at no cost to the Optionee by contacting

Exhibit 10.7

the Company by telephone or in writing. The Optionee further acknowledges that the Optionee will be provided with a paper copy of any documents if the attempted electronic delivery of such documents fails. Similarly, the Optionee understands that the Optionee must provide the Company or any designated third party administrator with a paper copy of any documents if the attempted electronic delivery of such documents fails. The Optionee may revoke his or her consent to the electronic delivery of documents or may change the electronic mail address to which such documents are to be delivered (if the Optionee has provided an electronic mail address) at any time by notifying the Company of such revoked consent or revised electronic mail address by telephone, postal service or electronic mail. Finally, the Optionee understands that he or she is not required to consent to electronic delivery of documents.

18.No Advice Regarding Grant. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations or assessments regarding the Optionee’s acceptance of this award, participation in the Plan, or acquisition or sale of the underlying Shares. The Optionee is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her acceptance of this award and participation in the Plan before taking any action related to the Plan.

19.Counterparts. This Agreement may be executed in one or more counterparts (including via facsimile and electronic image scan (pdf)), each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument and shall become effective when one or more counterparts have been signed by each party and delivered to the other party.

20.Appendix. Notwithstanding any provisions in this Agreement, the Option shall be subject to any special terms, conditions or notifications set forth in Appendix A to this Agreement for the Optionee’s country, which shall constitute part of this Agreement. Moreover, if the Optionee relocates to one of the countries included in Appendix A, the special terms and conditions for such country will apply to the Optionee, to the extent the Company determines that the application of such terms and conditions is necessary or advisable in order to comply with local law or facilitate the administration of the Plan.

[Signatures on Next Page]

IN WITNESS WHEREOF, the Company, by its duly authorized officer, and the Optionee have executed this Agreement as of the Grant Date.

By the Optionee’s acceptance of this Agreement, the Optionee and the Company agree that the Option is granted under and governed by the terms and conditions of the Plan, the Optionee’s grant notification and this Agreement. The Optionee has reviewed the Plan, the Plan prospectus, the Optionee’s grant notification and this Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Agreement, and fully understands all provisions of the Plan, the Plan prospectus, the Optionee’s grant notification and this Agreement. The Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions relating to the Plan, the Plan prospectus, the Optionee’s grant notification and this Agreement. The Optionee further agrees to notify the Company upon any change in Optionee’s residence address.

Exhibit 10.7

AVON PRODUCTS, INC. OPTIONEE

_________________________ Chief Executive Officer _________________________ Name:

APPENDIX A

ADDITIONAL TERMS AND CONDITIONS OF

INTERNATIONAL OPTION AGREEMENT

UNDER THE

AVON PRODUCTS, INC. 2016 OMNIBUS INCENTIVE PLAN

NON-U.S. EMPLOYEES

This Appendix includes additional terms and conditions that govern the Option granted to the Optionee under the Plan if the Optionee resides in one of the countries listed below. Capitalized terms used but not defined in this Appendix have the meanings set forth in the Plan and/or the Agreement.

The Optionee understands and agrees that the Company strongly recommends that the Optionee not rely on the information herein as the only source of information relating to the consequences of participation in the Plan because applicable rules and regulations regularly change, sometimes on a retroactive basis, and the information may be out of date at the time the Option vests or is exercised or the Shares underlying the Option are issued.

The Optionee further understands and agrees that if the Optionee is a citizen or resident of a country other than the one in which the Optionee is currently working, transfers employment after grant of the Option, or is considered a resident of another country for local law purposes, the information contained herein may not apply to the Optionee, and the Company shall, in its discretion, determine to what extent the terms and conditions contained herein shall apply, or determine that other terms and conditions are necessary or advisable in order to comply with local law or to facilitate the administration of the Agreement.

Argentina

Securities Law Information

The Optionee understands that neither the Options nor the Shares underlying the Options are publicly offered or listed on any stock exchange in Argentina. Therefore the offer of the Options does not constitute a public offering as defined under Argentine law. The offer is private and not subject to the supervision of any Argentine governmental authority.

Exchange Control Information

The Optionee is solely responsible for complying with the exchange control rules that may apply to the Optionee in connection with his or her participation in the Plan and/or transfer of proceeds from the sale

Exhibit 10.7

of Shares or receipt of dividends acquired under the Plan into Argentina. Prior to transferring funds into Argentina, the Optionee should consult his or her local bank and/or exchange control advisor to confirm what will be required by the bank because interpretations of the applicable Central Bank regulations vary by bank and exchange control rules and regulations are subject to change without notice.

Foreign Asset/Account Reporting Information

Argentinian residents must report any Shares acquired under the Plan and held by the resident on December 31 of each year on their annual tax return for that year.

Brazil

Compliance Notice

By accepting the Option, the Optionee agrees to comply with all applicable Brazilian laws and satisfy all applicable tax and social insurances associated with the vesting of the Option and the sale of the Shares obtained pursuant to the exercise of the Option. By accepting the Option, the Optionee further agrees that, for all legal purposes: (i) the benefits provided under the Plan are the result of commercial transactions unrelated to the Optionee’s employment; (ii) the Plan is not a part of the terms and conditions of the Optionee’s employment; and (iii) the income from the Option, if any, is not part of the Optionee’s remuneration from employment.

Report of Overseas Assets

If the Optionee is resident or domiciled in Brazil, the Optionee will be required to submit an annual declaration of assets and rights held outside of Brazil to the Central Bank of Brazil if the aggregate value of such assets and rights equals or exceeds US$100,000. Assets and rights that must be reported include, but are not limited to, the Shares acquired under the Plan.

Exchange Control Information

Remittance of funds for the purchase of Shares under the Plan must be made through an authorized commercial bank in Brazil.

Colombia

Foreign Exchange Notice / Overseas Investment Registration

Prior approval from a government authority generally is not required to purchase and hold foreign securities or to receive the Option. However, if the purchase of foreign securities is made through a foreign exchange intermediary (i.e., with funds located in Colombia that are then transferred abroad), a Form No. 4 will be required in order to register the investment with the Colombian Central Bank. The purchase of foreign securities may also be completed with funds the Optionee already holds abroad. In this scenario, no investment registration is required unless the value of foreign investments, including the value of any equity awards, as of December 31st of any given year, equals or exceeds US $500,000. In such case, the investments must be registered with the Colombian Central Bank by June 30th of the following year by filing a Form No. 11.

Exhibit 10.7

In any case, the Optionee understands and acknowledges that if the Optionee’s total overseas investments, including but not limited to any payment or Shares acquired pursuant to the Plan, at any time exceeds US $500,000, the Optionee is required to register such investments with the Colombian Central Bank by June 30 of the following year.

Germany

Exchange Control Information

Cross-border payments in excess of €12,500 must be reported monthly to the German Federal Bank (Bundesbank). In the event that the Optionee makes or receives a payment in excess of this amount, he or she is required to report the payment to Bundesbank electronically using the “General Statistics Reporting Portal” (“Allgemeines Meldeportal Statistik”) available via Bundesbank’s website (www.bundesbank.de).

Securities Disclaimer

Participation in the Plan is exempt or excluded from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Germany.

Mexico

Employment and Labor Law Acknowledgements

As a condition of accepting the Option, the Optionee acknowledges and agrees that: (i) the Option is not related to the salary or any other contractual benefits provided to the Optionee by the Optionee’s employer; (ii) any modification of the Plan or its termination shall not constitute a change or impairment of the terms and conditions of the Optionee’s employment; (iii) the grant of the Option is unilateral and discretionary and, therefore, the Company reserves the absolute right to amend it and discontinue it at any time without any liability to the Optionee; and (iv) neither the grant of the Option nor the issuance of Shares in any way establishes a labor relationship between the Optionee and the Company, which is headquartered in the United States, or any additional rights between the Optionee and the Optionee’s employer, based in Mexico.

By accepting the Option, the Optionee acknowledges that he or she has received a copy of the Plan, the Agreement and the Optionee’s grant notification, and has reviewed the Plan, the Agreement, including this Appendix, and the Optionee’s grant notification in their entireties, and fully understands and accepts all provisions thereof.

The Optionee acknowledges and confirms that the Optionee does not reserve any action or right to bring any claim against the Company or its Subsidiaries for any compensation or damages as a result of participation in the Plan and therefore grants a full and broad release to the Company and its Subsidiaries with respect to any claim that may arise under the Plan.

Compliance with Mexican Securities Laws

The Plan, the Option and the Shares are exempt from affirmative registration requirements in Mexico because the rights to acquire Shares pursuant to the Option and the Plan are limited to specified qualified employees in Mexico and communicated in a private and confidential manner.

Exhibit 10.7

Poland

Foreign Exchange Notice

The Optionee understands and acknowledges that the Optionee must notify the National Bank of Poland of the value of all foreign share ownership, including but not limited to Shares acquired under the Plan, if such ownership exceeds a designated threshold. If required, the reports are due on a quarterly basis by the 20th day following the end of each quarter. The reports are filed on special forms available on the website of the National Bank of Poland. In addition, the Optionee should maintain evidence of such foreign exchange transactions for five years, in case of a request for their production by the National Bank of Poland. The Optionee is strongly encouraged to consult with an appropriate legal advisor regarding these requirements.

Securities Disclaimer

The grant of the Options is exempt from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Poland.

Romania

Exchange Control Information

If the Optionee deposits the proceeds from the sale of Shares in a bank account in Romania, the Optionee may be required to provide the Romanian bank with appropriate documentation explaining the source of the funds. The Optionee is encouraged to consult his or her personal advisor to determine whether the Optionee will be required to submit such documentation to the Romanian bank.

Securities Disclaimer

Participation in the Plan is exempt or excluded from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Romania.

Spain

Tax Reporting Obligation for Assets Held Abroad

Individuals in Spain are required to report assets and right located outside of Spain (which would include Shares or any funds held in a U.S. brokerage account) on Form 720 by March 31st after each calendar year. Generally, a report is not required if the value of assets held outside of Spain is EUR 50,000 or less or if the assets held outside of Spain have not increased by more than EUR 20,000 compared to the previous year (assuming that a prior report has been filed reporting these assets). The Optionee is encouraged to consult his or her personal tax advisor for more information on how to complete the report and the specific information on what types of assets are required to be reported.

Foreign Exchange Notice

The Optionee understands that to participate in the Plan, the Optionee must comply with exchange control regulations in Spain. In this regard, the Optionee understands that if the Optionee remits funds out of

Exhibit 10.7

Spain to exercise the Option or receives cash dividends or cash proceeds from the sale of Shares, the Optionee must comply with all applicable foreign exchange regulations and notification requirements and provide any required information to the local financial institution through which the Optionee transfers the funds.

If the Optionee acquires Shares under the Plan and wishes to transfer the share certificates to Spain, the Optionee understands that the Optionee must declare the importation of such securities to the Dirección General de Política Comercial e Inversiones Exteriores (i.e., the Bureau for Commercial Policy and Foreign Investments, which is a department of the Ministry of Economy).

Securities Disclaimer

The grant of the Option is exempt from the requirement to publish a prospectus under the EU Prospectus Directive as implemented in Spain.

Turkey

Securities Law Information

Under Turkish law, the Optionee is not permitted to sell Shares acquired under the Plan in Turkey. The Optionee must sell the Shares acquired under the Plan outside of Turkey. The Shares are currently traded on the New York Stock Exchange in the United States under the ticker symbol “AVP” and shares may be sold on this exchange.

Exchange Control Information

Under Turkish exchange control regulations, the Optionee may be required to use a financial intermediary institution approved under the Turkish Capital Market Law to acquire or sell shares traded on a foreign market and to report such activity to the Capital Markets Board.  The Optionee should consult his or her personal advisor regarding these requirements.

United Kingdom

Securities Disclosure

Neither the Agreement nor this Appendix is an approved prospectus for the purposes of section 85(1) of the Financial Services and Markets Act 2000 (“FSMA”) and no offer of transferable securities to the public (for the purposes of section 102B of FSMA) is being made in connection with the Plan. The Plan and the Option are exclusively available in the UK to bona fide employees and former employees of the Company and any UK Subsidiary.

Tax and National Insurance Contributions

If the Company determines that it is required to account to HM Revenue & Customs for the Tax Liability and any Secondary NIC Liability or to withhold any other tax as a result of the Option, the Optionee, as a condition to the vesting of the Option, shall make arrangements satisfactory to the Company to enable it to satisfy all withholding liabilities. The Optionee shall also make arrangements satisfactory to the Company to enable it to satisfy any withholding requirements that may arise in connection with the exercise of the Option or disposition of Shares acquired pursuant to the Option.

Exhibit 10.7

As a further condition of the exercise of the Option under the Plan, the Optionee may at the Company’s discretion be directed to join with the Company, or if and to the extent that there is a change in the law, any of its Subsidiaries or person who is or becomes a Secondary Contributor in making a Joint Election which has been approved by HM Revenue & Customs, for the transfer of the whole Secondary NIC Liability.

To the extent permitted by law, the Optionee hereby agrees to indemnify and keep indemnified the Company and its Subsidiaries for any Tax Liability.

EX-10.8

Exhibit 10.8

AVON PRODUCTS, INC.

SERVICE-BASED

RESTRICTED STOCK UNIT AWARD AGREEMENT

Mr. Gustavo Arnal

Chief Financial Officer

Avon Products, Inc.

Dear Gustavo:

In accordance with your contract of employment, dated as of December 11, 2018, with Avon Cosmetics Limited (the “Employment Contract”), Avon Products, Inc. (the “Company”) has granted to you, effective May 1, 2019 (the “Grant Date”) Restricted Stock Units (the “RSUs”), representing the right to receive, in the future, shares of Stock (the “Shares”) as set forth in your grant notification. The RSUs are subject to the terms and conditions set forth in this Service-Based Restricted Stock Unit Award Agreement (this “Agreement”) and your grant notification. Please indicate your acceptance of this award by signing this Agreement and returning your signature to the Company’s Vice President, Global Compensation & Benefits.

1. Grant of Restricted Stock Unit Award. The RSUs are being awarded to you hereunder outside of the Company’s 2016 Omnibus Incentive Plan (the “Plan”). Notwithstanding that this award is made outside of the Plan, except as otherwise expressly provided in this Agreement and other than as to the Share limitations of Section 5 of the Plan, this Agreement will be interpreted in a manner consistent with the terms of the Plan and all such terms will be deemed to be incorporated into and made a part of this Agreement. All capitalized terms used in this Agreement shall have the meaning set forth in the Plan, unless otherwise defined herein.

2.Nature of RSUs; Issuance of Shares.

The RSUs represent a right to receive Shares on the Vesting Date (as defined below) but do not represent a current interest in the Shares. If all the terms and conditions hereof and of the Plan are met, then you shall be issued Shares on the Vesting Date (or earlier vesting date as provided in this Agreement). Notwithstanding the foregoing or anything in this Agreement to the contrary, the Company reserves the right to determine to settle all or a portion of your vested RSUs in cash, in lieu of Shares. Any such cash payment will equal (x) the Fair Market Value of a Share as of the Vesting Date (or earlier vesting date as provided in this Agreement), multiplied by (y) the number of vested RSUs the Company determines to settle in cash.

You should be aware that vesting of the RSUs will, to the extent settled in Shares, result in the ownership of Shares and will require you to open and use a U.S. brokerage account. You will personally be responsible for any local compliance requirements in relation to all of the above transactions. These requirements may change from time to time, and the Company cannot guarantee that you will be able to receive Shares on the Vesting Date (or earlier vesting date as provided in this Agreement). Moreover, the Company is not liable for any decrease of value of the Shares.

Exhibit 10.8

1. Restrictions on Transfer of RSUs. The RSUs may not be sold, tendered, assigned, transferred, pledged or otherwise encumbered.

2.Vesting of RSUs; Voting; Dividends.

(a)Subject to Section 5, vesting and settlement of the RSUs shall occur on the date set forth in your grant notification (such date, the “Vesting Date”). Subject to Section 5, vesting is contingent upon your being employed by the Company or any of its Subsidiaries on the Vesting Date.

(b)You do not have the right to vote any of the Shares underlying your RSUs or to receive dividends on them prior to the date such Shares are issued to you pursuant to the terms hereof. However, unless otherwise determined by the Committee, you will be credited with Dividend Equivalents with respect to your RSUs, which will be payable to you in cash by March 15th following the year in which such dividends are paid, provided that you remain employed by the Company and the Subsidiaries through the date such Dividend Equivalents are paid.

3.Termination of Employment.

(a)Termination of Employment by the Company without Cause At Any Time and without Retirement Eligibility Prior to End of Salary Continuation Period. If your employment with the Company and its Subsidiaries terminates for any reason other than for Cause and you have not attained Retirement (for all purposes under this Agreement, as such term is defined under the Plan as of the date hereof) and will not be eligible for Retirement at the end of the salary continuation period for which you are eligible under the “Severance” provision of the Employment Contract, then, a pro-rata portion of the RSUs awarded hereunder shall become vested and such pro-rata portion of RSUs (less any previously vested and settled RSUs) shall be settled in the form of Shares issued to you, within sixty (60) days after the date of your termination of employment. The number of RSUs that vest shall be determined by multiplying the total number of Shares subject to the RSUs awarded to you pursuant to this Agreement by a fraction, the numerator of which shall be the number of completed months of your employment from the Grant Date to the date of your termination of employment (typically the last day of active employment), and the denominator of which shall be the total number of months from the Grant Date to the Vesting Date.

(b)Retirement Prior to January 1 Following Grant Date or Termination of Employment By the Company Without Cause Prior to January 1 Following Grant Date and with Retirement Eligibility Prior to End of Salary Continuation Period. If (i) your employment with the Company and its Subsidiaries terminates due to Retirement prior to January 1 of the year following the Grant Date, or (ii) your employment with the Company and its Subsidiaries is terminated by the Company other than for Cause prior to January 1 of the year following the Grant Date, and you are or will be eligible for Retirement at the end of the salary continuation period for which you are eligible under the “Severance” provision of the Employment Contract, then, a pro-rata portion of the RSUs awarded hereunder shall become vested and such pro-rata portion of RSUs (less any previously vested and settled RSUs) shall be settled in the form of Shares issued to you, within sixty (60) days after the date of your termination of employment. The number of RSUs that vest shall be determined by multiplying the total number of Shares subject to the RSUs awarded to you pursuant to this Agreement by a fraction, the numerator of which shall be the number of completed months of your employment from the Grant Date to the date of your termination of employment (typically the last day of active employment), and the denominator of which shall be the total number of months from the Grant Date to the Vesting Date.

(c)Retirement On or After January 1 Following Grant Date or Termination of Employment By the Company Without Cause On or After January 1 Following Grant Date and with Retirement Eligibility Prior to End of Salary Continuation Period. If (i) your employment with the Company and its Subsidiaries terminates due to Retirement on or after January 1 of the year following the Grant Date, or (ii) your employment with the Company and its Subsidiaries is terminated by the Company other than for Cause on or after January 1 of the year following the Grant Date, and you are or will be eligible for Retirement at the end of the salary continuation period for which you are eligible under the “Severance”

Exhibit 10.8

provision of the Employment Contract, then, all of the RSUs awarded hereunder shall become vested and such vested RSUs (less any previously vested and settled RSUs) shall be settled in the form of Shares issued to you, on the Vesting Date.

(d)Termination due to Death or Disability. If (i) you die before your employment with the Company and its Subsidiaries otherwise terminates, or (ii) your employment with the Company and its Subsidiaries terminates due to Disability, then all of the RSUs granted hereunder shall immediately vest. Such vested RSUs shall be settled in the form of Shares issued to you, within sixty (60) days after such termination of employment.

(e)Terminations Causing Forfeiture. All unvested RSUs are immediately forfeited upon (i) an involuntary termination of your employment by the Employer for Cause prior to the Vesting Date or (ii) a voluntary resignation by you (other than due to Retirement or Disability) prior to the Vesting Date, provided that to the extent you provide notice of your voluntary termination of employment the RSUs shall be forfeited as of the date you give such notice.

(f)Change in Control. Notwithstanding any other provision of this Agreement, in the event of a Change in Control, the vesting and settlement of the RSUs shall be governed by the provisions of the Plan regarding a Change in Control, as if the RSUs were granted under the Plan, and such provisions of the Plan are incorporated herein by reference.

(g)Paid or Unpaid Leave of Absence. For purposes of determining the vesting of RSUs under this Agreement, a paid or unpaid leave of absence that has been approved by the Company shall not constitute a termination of your employment with the Company and its Subsidiaries. During such paid or unpaid leave of absence, until a termination of your employment with the Company and its Subsidiaries occurs, the RSUs shall continue to vest as set forth in this Agreement. For the avoidance of doubt, vesting of your award during any notice period relating to any termination of your employment by the Company (and, if applicable, by any Subsidiary for whom you are employed) other than for Cause is determined under Section 8(j) of this Agreement.

4.Non-Competition/Non-Solicitation/Non-Disclosure.

You agree that, during your employment and for a period of one year after your termination of employment with the Company and its Subsidiaries for any reason whatsoever (including, but not limited to, with or without Cause, Retirement or Disability), you shall not, without the prior written consent of the Committee, engage in any of the following activities:

(a)directly or indirectly engage or otherwise participate in any business which is competitive with any significant business of the Company or any Subsidiary, including without limitation, your acceptance of employment with, entrance into a consulting or advisory arrangement with, rendering services to or otherwise facilitating the business of Amway Corp./Alticor Inc., Amore Pacific, Arabela, Arbonne, Beiersdorf (Nivea), COTY, De Millus S.A., Ebel Int’l/Belcorp Corp., Elizabeth Arden, Faberlic, Herbalife Ltd., Inter Parfums, Jequiti, Lady Racine/LR Health & Beauty Systems GmbH, LG Health & Household, L’Occitane, L’Oréal Group/Cosmair Inc., Mary Kay Inc., Mistine/Better Way (Thailand) Co. Ltd., Natura Cosmetics S.A., Neways Int’l, NuSkin Enterprises Inc., O Boticário, Oriflame Cosmetics S.A., Origami Owl, Reckitt Benckiser PLC, Revlon Inc., Rodan & Fields, Shaklee Corp., Shiseido, Stella & Dot, Silpada, The Body Shop Int’l PLC, The Estée Lauder Companies Inc., The Procter & Gamble Company, Tupperware Corp., Unilever Group (N.V. and PLC), Vorwerk & Co. KG/Jafra Worldwide Holdings (Lux) S.à.R.L. Inc., Yanbal Int’l (Yanbal, Unique), Younique or any of their affiliates; or

(b)solicit or aid in the solicitation of any employees of the Company or any Subsidiary to leave their employment.

In addition, you shall not, unless compelled pursuant to an order of a court or other body having jurisdiction over such matter, communicate or divulge any secret or confidential information, knowledge or data, including without limitation any trade secrets, relating to the Company or a Subsidiary, and their

Exhibit 10.8

respective businesses, obtained by you during your employment by the Company or a Subsidiary and which is not otherwise publicly known (other than by reason of an unauthorized act by you), to anyone other than the Company and those designated by it.

In the event the Company determines that you have breached any term of this Section 6 or any non-disclosure, non-compete or non-solicitation covenant set forth in any individual agreement between you and the Company or one of its Subsidiaries, or any Company policy, then in addition to any other remedies the Company may have available to it, unless otherwise determined by the Committee: (x) all unvested RSUs granted hereunder shall be forfeited; (y) if Shares have been issued to you in respect of vested RSUs hereunder, then you shall forfeit all such Shares so issued to you hereunder; and (z) if cash has been paid to you in lieu of Shares in respect of all or a portion of the vested RSUs hereunder, you shall pay to the Company all such cash so paid; provided, however, that if you no longer hold Shares issued to you hereunder, then you shall pay to the Company in cash the Fair Market Value of the Shares issued to you hereunder, determined as of the date of such issuance.

Notwithstanding anything in this Section 6 to the contrary, this Agreement is not intended to, and shall be interpreted in a manner that does not, limit or restrict you from exercising any legally protected whistleblower rights (including pursuant to Rule 21F under the U.S. Securities Exchange Act of 1934).

5. Recoupment. Except where void by law and unless otherwise determined by the Committee, the RSUs, and any Shares or cash issued upon settlement of any vested RSUs, are subject to forfeiture and/or recoupment in the event that you have engaged in misconduct, including: (x) a serious violation of the Company’s Code of Conduct; or (y) a violation of law within the scope of your employment with the Company and its Subsidiaries. All RSUs hereunder are also subject to the Company’s Compensation Recoupment Policy.

6.Service Acknowledgments.

You acknowledge and agree as follows:

(a)The execution and delivery of this Agreement and the granting of the RSUs hereunder shall not constitute or be evidence of any agreement or understanding, express or implied, on the part of the Company or its Subsidiaries to employ you for any specific period.

(b)The award of the RSUs hereunder is a voluntary and occasional grant, and does not entitle you to any benefit other than that specifically granted under this Agreement, or to any future grants or other benefits under the Plan or any similar plan, even if RSUs have ever been granted in the past or have repeatedly been granted in the past. Any benefits granted under this Agreement and under the Plan are extraordinary and not part of your ordinary or expected compensation or salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, end-of-service payments, bonuses, long-service awards, pension, welfare or retirement benefits or similar payments, and in no event should be considered as compensation for, or relating in any way to, past services for the Company or any of its Subsidiaries.

(c)Nothing in this Agreement shall confer upon you any right to continue in the service of the Company or a Subsidiary or interfere in any way with any right of the Company or a Subsidiary to terminate your employment at any time, subject to applicable law.

(d)You are accepting the RSUs and entering into this Agreement voluntarily.

(e)The Plan may be modified, amended, suspended or terminated by the Company at any time, to the extent permitted by the Plan.

(f)All decisions with respect to future RSUs or other grants will be at the sole discretion of the Committee, subject to the terms of the Employment Contract.

Exhibit 10.8

(g)The future value of the underlying Shares is unknown, indeterminable and cannot be predicted with certainty. The value of the Shares may increase or decrease.

(h)Neither the Company nor any Subsidiary is providing any tax, legal or financial advice or making any recommendations regarding this award or your acquisition or sale of the Shares.

(i)In consideration of the grant of the RSUs, (i) you shall have no claim or entitlement to compensation or damages arising from (x) forfeiture of the RSUs resulting from termination of your service (for any reason whether or not in breach of local law) or otherwise pursuant to this Agreement or (y) diminution in value of the RSUs or Shares underlying the RSUs, and (ii) you irrevocably release the Company and its Subsidiaries from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by accepting the RSUs, you shall be deemed irrevocably to have waived your entitlement to pursue such a claim.

(j)Any notice period under the Employment Contract or otherwise arising in connection with an involuntary termination of your employment by the Company (and, if applicable, by any Subsidiary for whom you are employed) other than for Cause shall be treated as service for the purpose of determining the vesting of the RSUs. However, any notice period mandated under applicable law or otherwise for which you receive pay in lieu of notice shall not be treated as service for the purpose of determining the vesting of the RSUs, and your right to settlement of the RSUs after termination of service, if any, will be measured by the date of termination of your active service and will not be extended by any such notice period. Similarly, if the Company elects to place you on garden leave (or the equivalent) during any notice period under your Employment Contract or otherwise arising in connection with an involuntary termination of your employment by the Company (and, if applicable, by any Subsidiary for whom you are employed) other than for Cause, such leave period shall not be treated as service for the purpose of determining the vesting of the RSUs, and your right to settlement of the RSUs after termination of service, if any, will be measured by the date of termination of your active service (i.e., the commencement of such leave) and will not be extended by any such leave. Subject to the foregoing and the provisions of the Plan which are incorporated herein by reference, the Company, in its sole discretion, shall determine whether your service has terminated and the effective date of such termination.

(k)The grant of RSUs will not be interpreted to form an employment contract or employment relationship with the Company or any of its Subsidiaries that does not otherwise exist.

7.Data Privacy Acknowledgment and Consent.

By signing this Agreement, you acknowledge and agree that in order to implement, manage and administer this award and/or in connection with tax or other governmental and regulatory compliance activities directly or indirectly related to the RSUs, the Company and/or an entity belonging to the Company’s group of companies (including your employer) may need to process your personal data (electronically or otherwise), including, but not limited to, your name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any Shares or other equity securities or directorships held in the Company, details of all RSUs or any other entitlement to Shares awarded, canceled, vested, unvested or outstanding in your favor (the “Personal Data”). The transfer of Personal Data to and collection by third-party service providers outside the Company’s group of companies, such as the Company’s authorized agent, may also be necessary in order to implement, manage and administer this award and the Plan.

You expressly and unambiguously consent to the collection, use and other processing of Personal Data by the Company, entities belonging to the Company’s group of companies, and third-party service providers. You understand that the Company may transfer your Personal Data to the United States, or other countries which may have a different or lower level of data protection law than your home country and which are not considered by the European Commission or the United Kingdom (should the United Kingdom cease to be a member of the European Economic Area (“EEA”)) or the data protection agencies of other jurisdictions to have data protection laws equivalent to the laws in your country. The Company

Exhibit 10.8

will therefore maintain an EU-US Privacy Shield certification or enter into an alternate data processing and transfer arrangement authorized by applicable law, such as standard contractual clauses, to protect your Personal Data consistent with data protection laws of the European Union or the United Kingdom (should the United Kingdom cease to be a member of the EEA).

In addition, you expressly and unambiguously consent to the disclosure of Personal Data to, and processing by, a third party in the event of any potential or actual reorganization, merger, sale, joint venture, assignment, transfer or other disposition of all or any portion of the Company’s business, assets or stock (including in connection with any bankruptcy or similar proceedings); and as the Company believes necessary or appropriate: (a) under applicable law, including laws outside of your country; (b) to comply with legal processes; and (c) to respond to requests from public and government authorities including public and government authorities outside of your country.

You authorize the recipients to receive, possess, use, retain and transfer the Personal Data, in electronic or other form, for the purposes of implementing, managing and administering this award, including any requisite transfer of such Personal Data as may be required to a broker or other third party with whom you may elect to deposit any Shares acquired upon settlement of the RSUs. You understand that Personal Data will be held only as long as is necessary to implement, manage and administer this award unless a longer retention period is required by applicable laws, regulations, rules or valid requests or orders of a court or other dispute resolution forums or of a governmental or public authority, in each case, including those of a court or other dispute resolution forums or of a governmental or public authority outside of your country.You understand that you may, at any time, view your Personal Data, request additional information about the storage and processing of your Personal Data, require any necessary amendments to your Personal Data that is incorrect or refuse or withdraw the consents herein, in any case without cost, by contacting in writing your local stock program coordinator.

If you do not consent, or if you later seek to revoke your consent, your employment status or career with the Company or Subsidiary will not be adversely affected; the only adverse consequence of refusing or withdrawing your consent is that the Company would not be able to grant RSUs under the Plan or other equity awards, or manage or administer such awards. Therefore, you understand that refusing or withdrawing your consent may affect your ability to receive equity awards. For more information on the consequences of your refusal to consent or withdrawal of consent, you may contact your local stock program coordinator.

If you are a resident of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA), your Personal Data will not be processed on the basis of consent (unless you provide a specific consent separate from this Section 9), but will be processed where necessary to fulfil the Company’s contractual obligations to, where necessary to comply with the Company’s legal obligations under any applicable laws, or to meet the Company’s legitimate business interests. The Company has a legitimate interest in managing its business appropriately including incentivizing its employees, complying with its legal and contractual obligations, and keeping its records accurate and up to date. If you are a resident of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA) you should refer to the Privacy Statement for Associates issued by your employer for additional information about the processing of your Personal Data and your privacy rights. The Privacy Statement for Associates will govern the processing of your Personal Data in connection with the administration of this award.

The Company will take reasonable measures to keep the Personal Data private, confidential and accurate. You may obtain details with respect to the collection, use, processing and transfer of your Personal Data in relation to this award and may also request a list with names and addresses of potential

Exhibit 10.8

recipients of the Personal Data and/or access to and updates of such Personal Data, if needed, by contacting your local stock program coordinator.

8. Responsibility for Taxes.

By accepting this grant, you hereby irrevocably elect to satisfy any taxes and social insurance contribution withholding required to be withheld by the Company or its Subsidiaries on the date of grant or vesting of the RSUs or the date of delivery or sale of any Shares hereunder or on any earlier date on which such taxes or social insurance contribution withholding may be due (“Tax Liability”) by authorizing the Company and any of its Subsidiaries to withhold a sufficient number of Shares that would otherwise be deliverable to you upon settlement of the RSUs (or, if the RSUs are settled in cash in lieu of Shares, an amount of cash sufficient to satisfy the Tax Liability). If, for any reason, the Shares or cash that would otherwise be deliverable to you upon settlement of the RSUs would be insufficient to satisfy the Tax Liability, the Company and any of its Subsidiaries are authorized to withhold an amount from your wages or other compensation sufficient to satisfy the Tax Liability. Furthermore, you agree to pay the Company or its Subsidiaries any amount of the Tax Liability that cannot be satisfied through one of the foregoing methods.

Notwithstanding the foregoing, if, on the applicable Vesting Date or on any earlier date on which the Tax Liability may be due, the delivery of Shares is not made for any reason, you hereby irrevocably elect to satisfy such Tax Liability by delivering cash to the Company in an amount sufficient to satisfy such Tax Liability.

Apart from any withholding obligations that may apply to the Company and/or its Subsidiaries, you acknowledge and agree that the ultimate responsibility for the Tax Liability is and remains with you. You further acknowledge that: (x) the Company and its Subsidiaries make no representations or undertakings regarding the Tax Liability or the receipt of any dividends; (y) the Company and its Subsidiaries do not commit to structure the terms of the grant or any other aspect of the RSUs to reduce or eliminate the Tax Liability; and (z) you should consult a tax adviser regarding the Tax Liability.

You acknowledge that the Company and its Subsidiaries shall have no obligation to deliver Shares until the Tax Liability has been fully satisfied by you.

9. U.S. Internal Revenue Code Section 409A. If you are subject to U.S. Internal Revenue Code Section 409A (“Section 409A”), then the following provisions shall apply:

(a)Any provision, application or interpretation of this Agreement that is inconsistent with Section 409A shall be disregarded. In no event shall the Company, any of its affiliates, any of its agents, or any member of the Board have any liability for any taxes, interests or penalties imposed in connection with a failure of this Agreement to comply with Section 409A.

(b)If (i) any payment hereunder is a non-exempt amount payable under a “nonqualified deferred compensation plan” (as defined in Section 409A) upon a “separation from service” (as defined in Section 409A) (other than death), and (ii) you are a “specified employee” (as that term is defined in Section 409A and pursuant to procedures established by the Company) on the date of such separation from service, then any Shares or cash payable pursuant to the RSUs on account of such separation from service (other than death) will not be paid to you during the six-month period immediately following such separation from service. Instead, the Shares or cash that would have been payable pursuant to the RSUs on account of your separation from service shall be paid no earlier than the first day of the seventh month following your separation from service.

10.United Kingdom Specific Provisions. The following provisions apply to you as a resident of the United Kingdom. Please appreciate that the information contained in this Section 12 is general in nature and may not apply to your particular situation, and the Company is not in a position to assure you of any

Exhibit 10.8

particular result. Accordingly, you are advised to seek appropriate professional advice as to how the relevant laws of your home country may apply to your situation. You further understand and agree that if you are a citizen or resident of a country other than the one in which you are currently working, or if your employment transfers after the grant of the RSUs, or if you are considered a resident of another country for local law purposes, the information contained herein may not apply to you, and the Company shall, in its discretion, determine to what extent the terms and conditions contained herein shall apply, or determine that other terms and conditions are necessary or advisable in order to comply with local law or to facilitate the administration of this Agreement.

(a)Tax and National Insurance Contributions. If the Company determines that it is required to account to HM Revenue & Customs for the Tax Liability and any Secondary NIC Liability or to withhold any other tax as a result of the RSUs, you, as a condition to the vesting of the RSUs, shall make arrangements satisfactory to the Company to enable it to satisfy all withholding liabilities. You shall also make arrangements satisfactory to the Company to enable it to satisfy any withholding requirements that may arise in connection with the vesting of the RSUs or disposition of Shares acquired pursuant to the RSUs. As a further condition of the vesting of the RSUs, you may, at the Company’s discretion, be directed to join with the Company, or if and to the extent that there is a change in the law, any of its Subsidiaries or person who is or becomes a Secondary Contributor, in making a Joint Election which has been approved by HM Revenue & Customs, for the transfer of the whole any Secondary NIC Liability. To the extent permitted by law, you hereby agree to indemnify and keep indemnified the Company and its Subsidiaries for any Tax Liability.

(b)Securities Disclosure. This Agreement is not an approved prospectus for the purposes of section 85(1) of the Financial Services and Markets Act 2000 (“FSMA”) and no offer of transferable securities to the public (for the purposes of section 102B of FSMA) is being made in connection herewith. This Agreement and the RSUs are exclusively available to you as a bona fide employee of the Employer in the UK.

11.Notice. Any notice required to be given hereunder to you shall be addressed to you at your current address shown on the Company’s records. Notice shall be sent by mail, express delivery or, if practical, by electronic delivery or hand delivery.

12.Provisions Inconsistent with Translation. To the extent that you have been provided with a translation of this Agreement, the English language version of this Agreement shall prevail in case of any discrepancies or ambiguities due to translation.

13.Acknowledgment. The Company and you agree that the RSUs are granted under, and governed by, your grant notification, this Agreement and by those provisions set forth in the Plan that are incorporated herein by reference. You: (x) acknowledge receipt of a copy of such grant notification, this Agreement, the Plan and the prospectus relating to this award; (y) represent that you have carefully read and are familiar with their provisions; and (z) hereby accept the RSUs subject to all of the terms and conditions set forth herein, including those provisions set forth in the Plan that are incorporated herein by reference.

14.Compliance with Laws and Regulations. The granting of the RSUs and the delivery of Shares hereunder shall be subject to all applicable laws, rules and regulations. The issuance of Shares will be subject to and conditioned upon compliance by the Company and its Subsidiaries and you with all applicable laws and regulations and with all applicable requirements of any stock exchange or automated quotation system on which the Shares may be listed or quoted at the time of such issuance or transfer. If any provision of this Agreement conflicts with applicable mandatory law, the provisions of such law shall govern.

15.Additional Conditions to Issuance of Shares. If, at any time the Company determines, in its discretion, that as a condition to the issuance of Shares to you (or your estate) hereunder, it is necessary or desirable to (i) list, register, qualify or comply with the rules of any securities exchange, (ii) qualify or comply with any applicable state, federal or foreign law, including the applicable tax code and related

Exhibit 10.8

regulations, or (iii) obtain the consent or approval of any governmental regulatory authority or securities exchange, then such issuance will not occur unless and until such listing, registration, qualification, rule compliance, consent or approval is completed, effected or obtained free of any conditions not acceptable to the Company. Where the Company determines that the delivery of Shares hereunder will violate federal securities laws or other applicable law, the Company will defer delivery until the earliest date on which the Company reasonably anticipates that the delivery of Shares hereunder will no longer cause such violation. The Company will make all reasonable efforts to meet the requirements of any such state, federal or foreign law or securities exchange and to obtain any such consent or approval of any such governmental authority or securities exchange.

16.Foreign Exchange. You acknowledge and agree that it is your sole responsibility to investigate and comply with any applicable exchange control laws in connection with the issuance and delivery of the Shares pursuant to the vesting of the RSUs, and that you shall be responsible for any reporting of inbound international fund transfers required under applicable law. You are advised to seek appropriate professional advice as to how the exchange control regulations apply to your specific situation. You acknowledge and agree that neither the Company nor any Subsidiary shall be liable for any foreign exchange rate fluctuation between your local currency and the United States Dollar that may affect the value of the RSUs or of any amounts due to you pursuant to the settlement of the RSUs or the subsequent sale of any Shares acquired upon settlement.

17.Miscellaneous. The Company at any time, and from time to time, may amend the terms of this Agreement; provided, however, that your rights shall not be materially adversely affected without your written consent (except to the extent permitted under the Plan). No waiver by either party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. All amounts credited in respect of the RSUs to the book-entry account under this Agreement shall continue for all purposes to be part of the general assets of the Company. Your interest in such account shall make you only a general, unsecured creditor of the Company. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, and each other provision of this Agreement shall be severable and enforceable to the extent permitted by law. In lieu of issuing a fraction of a Share resulting from an adjustment of the RSUs pursuant to Section 9 of the Plan or otherwise, the Company shall be entitled to pay to you an amount equal to the Fair Market Value of such fractional Share. The terms of this Agreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and to the benefit of you and your beneficiaries, executors, administrators, heirs and successors. The headings of the Sections hereof are provided for convenience only and are not to serve as a basis for interpretation or construction, and shall not constitute a part, of this Agreement.

18.Entire Agreement. This Agreement (including those provisions set forth in the Plan that are incorporated herein by reference) and your grant notification contain the entire agreement and understanding of the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations and negotiations in respect thereto (including those provisions of the Employment Contract describing this award).

19.Applicable Law. This Agreement (including those provisions set forth in the Plan that are incorporated herein by reference) and your grant notification, all actions taken hereunder or under the Plan shall be governed by, and construed in accordance with, the laws of the State of New York without regard to the conflict of law principles thereof.

20.Electronic Delivery and Acceptance. The Company may, in its sole discretion, decide to deliver any documents related to the RSUs or any future awards that may be awarded under the Plan by electronic means, or request your consent to participate in the Plan by electronic means. Such means of electronic delivery may include, but do not necessarily include, the delivery of a link to a Company intranet or the Internet site of a third party involved in administering this award or the Plan, the delivery of the document

Exhibit 10.8

via electronic mail or such other means of electronic delivery specified by the Company. You consent to the electronic delivery of your grant notification, this Agreement, the Plan and the prospectus relating to this award. You acknowledge that you may receive from the Company a paper copy of any documents delivered electronically, at no cost to you, by contacting the Company by telephone or in writing. You further acknowledge that you will be provided with a paper copy of any documents if the attempted electronic delivery of such documents fails. Similarly, you understand that you must provide the Company or any designated third-party administrator with a paper copy of any documents if the attempted electronic delivery of such documents fails. You may revoke your consent to the electronic delivery of documents (or may change the electronic mail address to which such documents are to be delivered to you) at any time by notifying the Company of such revoked consent or revised electronic mail address by telephone, postal service or electronic mail. Finally, you understand that you are not required to consent to electronic delivery of documents.

21.No Advice Regarding Grant. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations or assessments regarding your acceptance of this award, or your acquisition or sale of the underlying Shares. You are hereby advised to consult with your own personal tax, legal and financial advisors regarding your acceptance of this award.

22.Counterparts. This Agreement may be executed in one or more counterparts (including via facsimile and electronic image scan (pdf)), each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument and shall become effective when one or more counterparts have been signed by each party and delivered to the other party.

[Signatures on Next Page]

IN WITNESS WHEREOF, the Company, by its duly authorized officer, and you have executed this Agreement as of the Grant Date.

By your acceptance of this Agreement, you and the Company agree that the RSUs are granted under and governed by the terms and conditions of your grant notification and this Agreement, including those provisions set forth in the Plan that are incorporated herein by reference. You have reviewed this Agreement, the Plan and the prospectus relating to this award in their entirety, and fully understand all provisions thereof. You have had an opportunity to obtain the advice of counsel prior to executing this Agreement. You hereby agree to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions relating to your grant notification, this Agreement, the Plan and the prospectus relating to this award. You further agree to notify the Company upon any change in your residence address.

AVON PRODUCTS, INC. GRANTEE

Exhibit 10.8

Jan Zijderveld, Chief Executive Officer Gustavo Arnal

EX-10.9

Exhibit 10.9

AVON PRODUCTS, INC.

PERFORMANCE CONTINGENT

RESTRICTED STOCK UNIT AWARD AGREEMENT

Mr. Gustavo Arnal

Chief Financial Officer

Avon Products, Inc.

Dear Gustavo:

In accordance with your contract of employment, dated as of December 11, 2018, with Avon Cosmetics Limited (the “Employment Contract”), Avon Products, Inc. (the “Company”) has granted to you, effective May 1, 2019 (the “Grant Date”), Performance Contingent Restricted Stock Units (the “PRSUs”), representing the right to receive, in the future, shares of Stock (the “Shares”) as set forth in your grant notification. The PRSUs are subject to the terms and conditions set forth in this Performance Restricted Stock Unit Award Agreement (this “Agreement”) and your grant notification. Please indicate your acceptance of this award by signing this Agreement and returning your signature to the Company’s Vice President, Global Compensation & Benefits.

1. Grant of Performance Contingent Restricted Stock Unit Award.The PRSUs are being awarded to you hereunder outside of the Company’s 2016 Omnibus Incentive Plan (the “Plan”). Notwithstanding that this award is made outside of the Plan, except as otherwise expressly provided in this Agreement and other than as to the Share limitations of Section 5 of the Plan, this Agreement will be interpreted in a manner consistent with the terms of the Plan and all such terms will be deemed to be incorporated into and made a part of this Agreement. All capitalized terms used in this Agreement shall have the meaning set forth in the Plan, unless otherwise defined herein.

2.Nature of PRSUs; Issuance of Shares.

The PRSUs represent a right to receive Shares on the Settlement Date (as defined below) but do not represent a current interest in the Shares. If all the terms and conditions hereof and of the Plan are met, then you shall be issued Shares on the Settlement Date. Notwithstanding the foregoing or anything in this Agreement to the contrary, the Company reserves the right to determine to settle all or a portion of your vested PRSUs in cash, in lieu of Shares. Any such cash payment will equal (x) the Fair Market Value of a Share as of the Settlement Date multiplied by (y) the number of vested PRSUs the Company determines to settle in cash.

You should be aware that vesting of the PRSUs will, to the extent settled in Shares, result in the ownership of Shares and will require you to open and use a U.S. brokerage account. You will personally be responsible for any local compliance requirements in relation to all of the above transactions. These requirements may change from time to time, and the Company cannot guarantee that you will be able to receive

Exhibit 10.9

7

Shares on the Settlement Date. Moreover, the Company is not liable for any decrease of value of the Shares.

1. Restrictions on Transfer of PRSUs.The PRSUs may not be sold, tendered, assigned, transferred, pledged or otherwise encumbered.

2.Vesting of PRSUs; Voting; Dividends.

(a)Subject to Section 5, vesting of the PRSUs shall occur on the date set forth in your grant notification (such date, the “Vesting Date”), and settlement shall occur on the date set forth in your grant notification (such date, the “Settlement Date”) (which shall be no later than 60 days after the Vesting Date). Subject to Section 5, vesting and settlement are contingent upon: (i) your being employed by the Company or any of its Subsidiaries on the Vesting Date; and (ii) satisfaction by the Company of performance measures set forth in your grant notification (the “Performance Measures”), as determined by the Committee.

(b)You do not have the right to vote any of the Shares underlying the PRSUs or to receive dividends on them prior to the date such Shares are issued to you pursuant to the terms hereof.

3.Termination of Employment.

(a)Termination of Employment by the Company without Cause. If your employment with the Company and its Subsidiaries terminates for any reason other than for Cause on or after January 1 of the year following the Grant Date and you have not attained Retirement (for all purposes under this Agreement, as such term is defined under the Plan as of the date hereof) and will not be eligible for Retirement at the end of the salary continuation period for which you are eligible under the “Severance” provision of the Employment Contract, then, provided that the Company has satisfied the Performance Measures as of the Vesting Date, a pro-rata portion of the PRSUs awarded hereunder shall become vested and such pro-rata portion of PRSUs shall be settled in the form of Shares issued to you on the Settlement Date. The number of PRSUs that vest shall be determined by multiplying the number of Shares subject to the PRSUs that are actually earned based on achievement of the applicable Performance Measures by a fraction, the numerator of which shall be the number of completed months of your employment from the Grant Date to the date of your termination of employment (typically the last day of active employment), and the denominator of which shall be the total number of months from the Grant Date to the Vesting Date.

(b)Termination of Employment Due to Retirement. If (i) your employment with the Company and its Subsidiaries terminates due to Retirement on or after January 1 of the year following the Grant Date, or (ii) your employment with the Company and its Subsidiaries is terminated by the Company other than for Cause on or after January 1 of the year following the Grant Date, and you are or will be eligible for Retirement at the end of the salary continuation period for which you are eligible under the “Severance” provision of the Employment Contract, then, provided that the Company has satisfied the Performance Measures as of the Vesting Date, a pro-rata portion of the PRSUs awarded hereunder shall become vested and such pro-rata portion of PRSUs shall be settled in the form of Shares issued to you on the Settlement Date. The number of PRSUs that vest shall be determined by multiplying the number of Shares subject to the PRSUs that are actually earned based on achievement of the applicable Performance Measures by a fraction, the numerator of which shall be the number of completed months of your employment from the Grant Date to the date of your termination of employment (typically the last day of active employment), and the denominator of which shall be the total number of months from the Grant Date to the Vesting Date.

(c)Termination of Employment Due to Disability. If your employment with the Company and its Subsidiaries terminates due to Disability, then, provided that the Company has satisfied the Performance Measures as of the Vesting Date, a pro-rata portion of the PRSUs awarded hereunder shall become vested and such pro-rata portion of PRSUs shall be settled in the form of Shares issued to you on

Exhibit 10.9

the Settlement Date. The number of PRSUs that vest shall be determined by multiplying the number of Shares subject to the PRSUs that are actually earned based on achievement of the applicable Performance Measures by a fraction, the numerator of which shall be the number of completed months of your employment from the Grant Date to the date of your termination of employment (typically the last day of active employment), and the denominator of which shall be the total number of months from the Grant Date to the Vesting Date.

(d)Death. If you die before otherwise incurring a termination of your employment with the Company and its Subsidiaries, then, provided that the Company has satisfied the Performance Measures as of the Vesting Date, a pro-rata portion of the PRSUs awarded hereunder shall become vested and such pro-rata portion of PRSUs shall be settled in the form of Shares issued to you on the Settlement Date. The number of PRSUs that vest shall be determined by multiplying the number of Shares subject to the PRSUs that are actually earned based on achievement of the applicable Performance Measures by a fraction, the numerator of which shall be the number of completed months of your employment from the Grant Date to the date of your termination of employment (typically the last day of active employment), and the denominator of which shall be the total number of months from the Grant Date to the Vesting Date.

(e)Termination of Employment Causing Forfeiture. All PRSUs are forfeited if your employment with the Company and its Subsidiaries terminates under any of the following conditions: (i) your employment with the Company and its Subsidiaries is terminated by the Company for Cause prior to the Settlement Date; (ii) your employment with the Company and its Subsidiaries is terminated by the Company other than for Cause prior to January 1 of the year following the Grant Date; (iii) you voluntarily terminate your employment with the Company and its Subsidiaries due to Retirement prior to January 1 of the year following the Grant Date; or (iv) you voluntarily terminate your employment with the Company and its Subsidiaries (excluding Retirement or Disability) at any time prior to the Vesting Date, provided that to the extent you provide notice of your voluntary termination of employment the PRSUs shall be forfeited as of the date you give such notice.

(f)Change in Control. Notwithstanding any other provision of this Agreement, in the event of a Change in Control, the vesting and settlement of the PRSUs shall be governed by the provisions of the Plan regarding a Change in Control as if the PRSUs were granted under the Plan, and such provisions of the Plan are incorporated herein by reference.

(g)Paid or Unpaid Leave of Absence. For purposes of determining the vesting of PRSUs under this Agreement, a paid or unpaid leave of absence that has been approved by the Company shall not constitute a termination of your employment with the Company and its Subsidiaries. During such paid or unpaid leave of absence, until a termination of your employment with the Company and its Subsidiaries occurs, the PRSUs shall continue to vest as set forth in this Agreement. For the avoidance of doubt, vesting of your award during any notice period relating to any termination of your employment by the Company (and, if applicable, by any Subsidiary for whom you are employed) other than for Cause is determined under Section 8(j) of this Agreement.

4.Non-Competition/Non-Solicitation/Non-Disclosure.You agree that, during your employment and for a period of one year after your termination of employment with the Company and its Subsidiaries for any reason whatsoever (including, but not limited to, with or without Cause, Retirement or Disability), you shall not, without the prior written consent of the Committee, engage in any of the following activities:

(a)directly or indirectly engage or otherwise participate in any business which is competitive with any significant business of the Company or any Subsidiary, including without limitation, your acceptance of employment with, entrance into a consulting or advisory arrangement with, rendering services to or otherwise facilitating the business of Amway Corp./Alticor Inc., Amore Pacific, Arabela, Arbonne, Beiersdorf (Nivea), COTY, De Millus S.A., Ebel Int’l/Belcorp Corp., Elizabeth Arden, Faberlic, Herbalife Ltd., Inter Parfums, Jequiti, Lady Racine/LR Health & Beauty Systems GmbH, LG Health & Household, L’Occitane, L’Oréal Group/Cosmair Inc., Mary Kay Inc., Mistine/Better Way (Thailand) Co.

Exhibit 10.9

Ltd., Natura Cosmetics S.A., Neways Int’l, NuSkin Enterprises Inc., O Boticário, Oriflame Cosmetics S.A., Origami Owl, Reckitt Benckiser PLC, Revlon Inc., Rodan & Fields, Shaklee Corp., Shiseido, Stella & Dot, Silpada, The Body Shop Int’l PLC, The Estée Lauder Companies Inc., The Procter & Gamble Company, Tupperware Corp., Unilever Group (N.V. and PLC), Vorwerk & Co. KG/Jafra Worldwide Holdings (Lux) S.à.R.L. Inc., Yanbal Int’l (Yanbal, Unique), Younique or any of their affiliates; or

(b)solicit or aid in the solicitation of any employees of the Company or any Subsidiary to leave their employment.

In addition, you shall not, unless compelled pursuant to an order of a court or other body having jurisdiction over such matter, communicate or divulge any secret or confidential information, knowledge or data, including without limitation any trade secrets, relating to the Company or a Subsidiary, and their respective businesses, obtained by you during your employment by the Company or a Subsidiary and which is not otherwise publicly known (other than by reason of an unauthorized act by you), to anyone other than the Company and those designated by it.

In the event the Company determines that you have breached any term of this Section 6 or any non-disclosure, non-compete or non-solicitation covenant set forth in any individual agreement between you and the Company or one of its Subsidiaries, or any Company policy, then in addition to any other remedies the Company may have available to it, unless otherwise determined by the Committee: (i) all unvested PRSUs granted hereunder shall be forfeited; (ii) all vested but not yet settled PRSUs hereunder shall be forfeited; (iii) if Shares have been issued to you in respect of all or a portion of the vested PRSUs hereunder, then you shall forfeit all such Shares so issued to you hereunder; and (iv) if cash has been paid to you in lieu of Shares in respect of all or a portion of the PRSUs hereunder, then you shall pay to the Company all such cash so paid; provided, however, that if you no longer hold Shares issued to you hereunder, then, you shall pay to the Company in cash the Fair Market Value of the Shares issued to you hereunder, determined as of the date of such issuance.

Notwithstanding anything in this Section 6 to the contrary, this Agreement is not intended to, and shall be interpreted in a manner that does not, limit or restrict you from exercising any legally protected whistleblower rights (including pursuant to Rule 21F under the U.S. Securities Exchange Act of 1934).

5. Recoupment.Except where void by law and unless otherwise determined by the Committee, the PRSUs, and any Shares or cash issued upon settlement of any vested PRSUs, are subject to forfeiture and/or recoupment in the event that you have engaged in misconduct, including: (x) a serious violation of the Company’s Code of Conduct; or (y) a violation of law within the scope of your employment with the Company and its Subsidiaries. All PRSUs hereunder are also subject to the Company’s Compensation Recoupment Policy.

6.Service Acknowledgments.

You acknowledge and agree as follows:

(a)The execution and delivery of this Agreement and the granting of the PRSUs hereunder shall not constitute or be evidence of any agreement or understanding, express or implied, on the part of the Company or its Subsidiaries to employ you for any specific period.

(b)The award of the PRSUs hereunder is voluntary and occasional, and does not entitle you to any benefit other than that specifically granted under this Agreement, or to any future grants or other benefits under the Plan or any similar plan, even if PRSUs have ever been granted in the past or have repeatedly been granted in the past. Any benefits granted under this Agreement and under the Plan are extraordinary and not part of your ordinary or expected compensation or salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, end-of-service payments, bonuses, long-service awards, pension, welfare or retirement benefits or similar

Exhibit 10.9

payments, and in no event should be considered as compensation for, or relating in any way to, past services for the Company or any of its Subsidiaries.

(c)Nothing in this Agreement shall confer upon you any right to continue in the service of the Company or a Subsidiary or interfere in any way with any right of the Company or a Subsidiary to terminate your employment at any time, subject to applicable law.

(d)You are accepting the PRSUs and entering into this Agreement voluntarily.

(e)The Plan may be modified, amended, suspended or terminated by the Company at any time, to the extent permitted by the Plan.

(f)All decisions with respect to future PRSUs or other grants, if any, will be at the sole discretion of the Committee, subject to the terms of the Employment Contract.

(g)The future value of the underlying Shares is unknown, indeterminable and cannot be predicted with certainty. The value of the Shares may increase or decrease.

(h)Neither the Company nor any Subsidiary is providing any tax, legal or financial advice or making any recommendations regarding this award or your acquisition or sale of the Shares.

(i)In consideration of the grant of the PRSUs, (i) you shall have no claim or entitlement to compensation or damages arising from (x) forfeiture of the PRSUs resulting from termination of your service (for any reason whether or not in breach of local law) or otherwise pursuant to this Agreement or (y) diminution in value of the PRSUs or Shares underlying the PRSUs and (ii) you irrevocably release the Company and its Subsidiaries from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by accepting the PRSUs, you shall be deemed irrevocably to have waived your entitlement to pursue such a claim.

(j)Any notice period under the Employment Contract or otherwise arising in connection with an involuntary termination of your employment by the Company (and, if applicable, by any Subsidiary for whom you are employed) other than for Cause shall be treated as service for the purpose of determining the vesting of the PRSUs. However, any notice period mandated under applicable law or otherwise for which you receive pay in lieu of such notice shall not be treated as service for the purpose of determining the vesting of the PRSUs, and your right to the vesting of Shares in settlement of the PRSUs after termination of service, if any, will be measured by the date of termination of your active service and will not be extended by any such notice period. Similarly, if the Company elects to place you on garden leave (or the equivalent) during any notice period under your Employment Contract or otherwise arising in connection with an involuntary termination of your employment by the Company (and, if applicable, by any Subsidiary for whom you are employed) other than for Cause, such leave period shall not be treated as service for the purpose of determining the vesting of the PRSUs, and your right to settlement of the PRSUs after termination of service, if any, will be measured by the date of termination of your active service (i.e., the commencement of such leave) and will not be extended by any such leave. Subject to the foregoing and the provisions of the Plan which are incorporated herein by reference, the Company, in its sole discretion, shall determine whether your service has terminated and the effective date of such termination.

(k)The grant of PRSUs will not be interpreted to form an employment contract or employment relationship with the Company or any of its Subsidiaries that does not otherwise exist.

7.Data Privacy Acknowledgment and Consent.

By signing thisAgreement, you acknowledge and agree that in order to implement, manage and administer this award and/or in connection with tax or other governmental and regulatory compliance activities directly or indirectly related to the PRSUs, the Company and/or an entity belonging to the Company’s group of companies (including your employer) may need to process your personal data (electronically or otherwise), including, but not limited to, your name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any Shares or other equity securities, directorships held in the Company, details of all PRSUs or any other entitlement to Shares awarded, canceled, vested, unvested or outstanding in your favor (the “Personal

Exhibit 10.9

Data”). The transfer of Personal Data to and collection by third-party service providers outside the Company’s group of companies, such as the Company’s authorized agent, may also be necessary in order to implement, manage and administer this award and the Plan.

You expressly and unambiguously consent to the collection, use and other processing of Personal Data by the Company, entities belonging to the Company’s group of companies, and third-party service providers. You understand that the Company may transfer your Personal Data to the United States, or other countries which may have a different or lower level of data protection law than your home country and which are not considered by the European Commission or the United Kingdom (should the United Kingdom cease to be a member of the European Economic Area (“EEA”)) or the data protection agencies of other jurisdictions to have data protection laws equivalent to the laws in your country. The Company will therefore maintain an EU-US Privacy Shield certification or enter into an alternate data processing and transfer arrangement authorized by applicable law, such as standard contractual clauses, to protect your Personal Data consistent with data protection laws of the European Union or the United Kingdom (should the United Kingdom cease to be a member of the EEA).

In addition, you expressly and unambiguously consent to the disclosure of Personal Data to, and processing by, a third party in the event of any potential or actual reorganization, merger, sale, joint venture, assignment, transfer or other disposition of all or any portion of the Company’s business, assets or stock (including in connection with any bankruptcy or similar proceedings); and as the Company believes necessary or appropriate: (a) under applicable law, including laws outside of your country; (b) to comply with legal processes; and (c) to respond to requests from public and government authorities including public and government authorities outside of your country.

You authorize the recipients to receive, possess, use, retain and transfer the Personal Data, in electronic or other form, for the purposes of implementing, managing and administering this award, including any requisite transfer of such Personal Data as may be required to a broker or other third party with whom you may elect to deposit any Shares acquired upon settlement of the PRSUs. You understand that Personal Data will be held only as long as is necessary to implement, manage and administer this award and your participation in the Plan, unless a longer retention period is required by applicable laws, regulations, rules or valid requests or orders of a court or other dispute resolution forums or of a governmental or public authority, in each case, including those of a court or other dispute resolution forums or of a governmental or public authority outside of your country. You understand that you may, at any time, view your Personal Data, request additional information about the storage and processing of your Personal Data, require any necessary amendments to your Personal Data that is incorrect or refuse or withdraw the consents herein, in any case without cost, by contacting in writing your local stock program coordinator.

If you do not consent, or if you later seek to revoke your consent, your employment status or career with the Company or Subsidiary will not be adversely affected; the only adverse consequence of refusing or withdrawing your consent is that the Company would not be able to grant PRSUs under the Plan or other equity awards, or manage or administer such awards. Therefore, you understand that refusing or withdrawing your consent may affect your ability to receive equity awards. For more information on the consequences of your refusal to consent or withdrawal of consent, you may contact your local stock program coordinator.

If you are a resident of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA), your Personal Data will not be processed on the basis of consent (unless you provide a specific consent separate from this Section 9), but will be processed where necessary to fulfil the Company’s contractual obligations to, where necessary to comply with the Company’s legal

Exhibit 10.9

obligations under any applicable laws, or to meet the Company’s legitimate business interests. The Company has a legitimate interest in managing its business appropriately including incentivizing its employees, complying with its legal and contractual obligations, and keeping its records accurate and up to date. If you are a resident of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA) you should refer to the Privacy Statement for Associates issued by your employer for additional information about the processing of your Personal Data and your privacy rights. The Privacy Statement for Associates will govern the processing of your Personal Data in connection with the administration of this award.

The Company will take reasonable measures to keep the Personal Data private, confidential and accurate. You may obtain details with respect to the collection use, processing and transfer of your Personal Data in relation to this award and may also request a list with names and addresses of potential recipients of the Personal Data and/or access to and updates of such Personal Data, if needed, by contacting your local stock program coordinator.

8. Responsibility for Taxes.

By accepting this grant, you hereby irrevocably elect to satisfy any taxes and social insurance contribution withholding required to be withheld by the Company or its Subsidiaries on the date of grant or vesting of the PRSUs or the date of delivery or sale of any Shares hereunder or on any earlier date on which such taxes or social insurance contribution withholding may be due (“Tax Liability”) by authorizing the Company or any of its Subsidiaries to withhold a sufficient number of Shares that would otherwise be deliverable to you upon settlement of the PRSUs (or, if the PRSUs are settled in cash in lieu of Shares, an amount of cash sufficient to satisfy the Tax Liability). If, for any reason, the Shares or cash that would otherwise be deliverable to you upon settlement of the PRSUs would be insufficient to satisfy the Tax Liability, the Company and any of its Subsidiaries are authorized to withhold an amount from your wages or other compensation sufficient to satisfy the Tax Liability. Furthermore, you agree to pay the Company or its Subsidiaries any amount of the Tax Liability that cannot be satisfied through one of the foregoing methods.

Notwithstanding the foregoing, if, on the applicable Settlement Date or on any earlier date on which the Tax Liability may be due, the delivery of Shares is not made for any reason, you hereby irrevocably elect to satisfy such Tax Liability by delivering cash to the Company in an amount sufficient to satisfy such Tax Liability.

Apart from any withholding obligations that may apply to the Company and/or its Subsidiaries, you acknowledge and agree that the ultimate responsibility for the Tax Liability is and remains with you. You further acknowledge that: (x) the Company and its Subsidiaries make no representations or undertakings regarding the Tax Liability; (y) the Company and its Subsidiaries do not commit to structure the terms of the grant or any other aspect of the PRSUs to reduce or eliminate the Tax Liability; and (z) you should consult a tax adviser regarding the Tax Liability.

You acknowledge that the Company and its Subsidiaries shall have no obligation to deliver Shares until the Tax Liability has been fully satisfied by you.

9. U.S. Internal Revenue Code Section 409A. If you are subject to U.S. Internal Revenue Code Section 409A (“Section 409A”), then the following provisions shall apply:

(a)Any provision, application or interpretation of this Agreement that is inconsistent with Section 409A shall be disregarded. In no event shall the Company, any of its affiliates, any of its agents, or any member of the Board have any liability for any taxes, interests or penalties imposed in connection with a failure of this Agreement to comply with Section 409A.

Exhibit 10.9

(b)If (i) any payment hereunder is a non-exempt amount payable under a “nonqualified deferred compensation plan” (as defined in Section 409A) upon a “separation from service” (as defined in Section 409A) (other than death), and (ii) you are a “specified employee” (as that term is defined in Section 409A and pursuant to procedures established by the Company) on the date of such separation from service, then any Shares or cash payable pursuant to the PRSUs on account of such separation from service (other than death) will not be paid to you during the six-month period immediately following such separation from service. Instead, the Shares or cash that would have been payable pursuant to the PRSUs on account of your separation from service shall be paid no earlier than the first day of the seventh month following your separation from service.

10. United Kingdom Specific Provisions. The following provisions apply to you as a resident of the United Kingdom. Please appreciate that the information contained in this Section 12 is general in nature and may not apply to your particular situation, and the Company is not in a position to assure you of any particular result. Accordingly, you are advised to seek appropriate professional advice as to how the relevant laws of your home country may apply to your situation. You further understand and agree that if you are a citizen or resident of a country other than the one in which you are currently working, or if your employment transfers after the grant of the PRSUs, or if you are considered a resident of another country for local law purposes, the information contained herein may not apply to you, and the Company shall, in its discretion, determine to what extent the terms and conditions contained herein shall apply, or determine that other terms and conditions are necessary or advisable in order to comply with local law or to facilitate the administration of this Agreement.

(a)Tax and National Insurance Contributions. If the Company determines that it is required to account to HM Revenue & Customs for the Tax Liability and any Secondary NIC Liability or to withhold any other tax as a result of the PRSUs, you, as a condition to the vesting of the PRSUs, shall make arrangements satisfactory to the Company to enable it to satisfy all withholding liabilities. You shall also make arrangements satisfactory to the Company to enable it to satisfy any withholding requirements that may arise in connection with the vesting of the PRSUs or disposition of Shares acquired pursuant to the PRSUs. As a further condition of the vesting of the PRSUs, you may, at the Company’s discretion, be directed to join with the Company, or if and to the extent that there is a change in the law, any of its Subsidiaries or person who is or becomes a Secondary Contributor, in making a Joint Election which has been approved by HM Revenue & Customs, for the transfer of the whole Secondary NIC Liability. To the extent permitted by law, you hereby agree to indemnify and keep indemnified the Company and its Subsidiaries for any Tax Liability.

(b)Securities Disclosure. This Agreement is not an approved prospectus for the purposes of section 85(1) of the Financial Services and Markets Act 2000 (“FSMA”) and no offer of transferable securities to the public (for the purposes of section 102B of FSMA) is being made in connection herewith. This Agreement and the PRSUs are exclusively available to you as a bona fide employee of Avon Cosmetics Limited.

11.Notice. Any notice required to be given hereunder to you shall be addressed to you at your current address shown on the Company’s records. Notice shall be sent by mail, express delivery or, if practical, by electronic delivery or hand delivery.

12.Provisions Inconsistent with Translation. To the extent that you have been provided with a translation of this Agreement, the English language version of this Agreement shall prevail in case of any discrepancies or ambiguities due to translation.

13.Acknowledgment. The Company and you agree that the PRSUs are granted under, and governed by, your grant notification, this Agreement and by those provisions set forth in the Plan that are incorporated herein by reference. You: (x) acknowledge receipt of a copy of such grant notification, this Agreement, the Plan and the prospectus relating to this award; (y) represent that you have carefully read and are familiar with their provisions; and (z) hereby accept the PRSUs subject to all of the terms and

Exhibit 10.9

conditions set forth in your grant notification and this Agreement, including those provisions set forth in the Plan that are incorporated herein by reference.

14.Compliance with Laws and Regulations. The granting of the PRSUs and the delivery of Shares hereunder shall be subject to all applicable laws, rules and regulations. The issuance of Shares will be subject to and conditioned upon compliance by the Company and its Subsidiaries and you with all applicable laws and regulations and with all applicable requirements of any stock exchange or automated quotation system on which the Shares may be listed or quoted at the time of such issuance or transfer. If any provision of this Agreement conflicts with applicable mandatory law, the provisions of such law shall govern.

15.Additional Conditions to Issuance of Shares. If, at any time the Company determines, in its discretion, that as a condition to the issuance of Shares to you (or your estate) hereunder, it is necessary or desirable to (i) list, register, qualify or comply with the rules of any securities exchange, (ii) qualify or comply with any applicable state, federal or foreign law, including the applicable tax code and related regulations, or (iii) obtain the consent or approval of any governmental regulatory authority or securities exchange, then such issuance will not occur unless and until such listing, registration, qualification, rule compliance, consent or approval is completed, effected or obtained free of any conditions not acceptable to the Company. Where the Company determines that the delivery of Shares hereunder will violate federal securities laws or other applicable law, the Company will defer delivery until the earliest date on which the Company reasonably anticipates that the delivery of Shares hereunder will no longer cause such violation. The Company will make all reasonable efforts to meet the requirements of any such state, federal or foreign law or securities exchange and to obtain any such consent or approval of any such governmental authority or securities exchange.

16.Foreign Exchange. You acknowledge and agree that it is your sole responsibility to investigate and comply with any applicable exchange control laws in connection with the issuance and delivery of the Shares pursuant to the vesting of the PRSUs and that you shall be responsible for any reporting of inbound international fund transfers required under applicable law. You are advised to seek appropriate professional advice as to how the exchange control regulations apply to your specific situation. You acknowledge and agree that neither the Company nor any Subsidiary shall be liable for any foreign exchange rate fluctuation between your local currency and the United States Dollar that may affect the value of the PRSUs, or of any amounts due to you pursuant to the settlement of the PRSUs or the subsequent sale of any Shares acquired upon settlement.

17.Miscellaneous. The Company at any time, and from time to time, may amend the terms of this Agreement; provided, however, that your rights shall not be materially adversely affected without your written consent (except to the extent permitted under the Plan). No waiver by either party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. All amounts credited in respect of the PRSUs to the book-entry account under this Agreement shall continue for all purposes to be part of the general assets of the Company. Your interest in such account shall make you only a general, unsecured creditor of the Company. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, and each other provision of this Agreement shall be severable and enforceable to the extent permitted by law. In lieu of issuing a fraction of a Share resulting from an adjustment of the PRSUs pursuant to Section 9 of the Plan or otherwise, the Company shall be entitled to pay to you an amount equal to the Fair Market Value of such fractional Share. The terms of this Agreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and to the benefit of you and your beneficiaries, executors, administrators, heirs and successors. The headings of the Sections hereof are provided for convenience only and are not to serve as a basis for interpretation or construction, and shall not constitute a part, of this Agreement.

Exhibit 10.9

18.Entire Agreement. This Agreement (including those provisions set forth in the Plan that are incorporated herein by reference) and your grant notification contain the entire agreement and understanding of the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations and negotiations in respect thereto (including those provisions of the Employment Contract describing this award).

19.Applicable Law. This Agreement (including those provisions set forth in the Plan that are incorporated herein by reference) and your grant notification, and all actions taken hereunder or under the Plan shall be governed by, and construed in accordance with, the laws of the State of New York without regard to the conflict of law principles thereof.

20.Electronic Delivery and Acceptance. The Company may, in its sole discretion, decide to deliver any documents related to the PRSUs or any future awards that may be awarded under the Plan by electronic means, or request your consent to participate in the Plan by electronic means. Such means of electronic delivery may include, but do not necessarily include, the delivery of a link to a Company intranet or the Internet site of a third party involved in administering this award or the Plan, the delivery of the document via electronic mail or such other means of electronic delivery specified by the Company. You consent to the electronic delivery of your grant notification, this Agreement, the Plan and the prospectus relating to this award. You acknowledge that you may receive from the Company a paper copy of any documents delivered electronically, at no cost to you, by contacting the Company by telephone or in writing. You further acknowledge that you will be provided with a paper copy of any documents if the attempted electronic delivery of such documents fails. Similarly, you understand that you must provide the Company or any designated third-party administrator with a paper copy of any documents if the attempted electronic delivery of such documents fails. You may revoke your consent to the electronic delivery of documents (or may change the electronic mail address to which such documents are to be delivered to you) at any time by notifying the Company of such revoked consent or revised electronic mail address by telephone, postal service or electronic mail. Finally, you understand that you are not required to consent to electronic delivery of documents.

21.No Advice Regarding Grant. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations or assessments regarding your acceptance of this award, or your acquisition or sale of the underlying Shares. You are hereby advised to consult with your own personal tax, legal and financial advisors regarding your acceptance of this award.

22.Counterparts. This Agreement may be executed in one or more counterparts (including via facsimile and electronic image scan (pdf)), each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument and shall become effective when one or more counterparts have been signed by each party and delivered to the other party.

[Signatures on Next Page]

IN WITNESS WHEREOF, the Company, by its duly authorized officer, and you have executed this Agreement as of the Grant Date.

By your acceptance of this Agreement, you and the Company agree that the PRSUs are granted under and governed by the terms and conditions of your grant notification and this Agreement, including those provisions set forth in the Plan that are incorporated herein by reference. You have reviewed your grant notification, this Agreement, the Plan and the prospectus relating to this award in their entirety, and fully understand all provisions thereof. You have had an opportunity to obtain the advice of counsel prior to executing this Agreement. You hereby agree to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions relating to your grant notification, this Agreement,

Exhibit 10.9

the Plan and the prospectus relating to this award. You further agree to notify the Company upon any change in your residence address.

AVON PRODUCTS, INC. GRANTEE

Jan Zijderveld, Chief Executive Officer Gustavo Arnal

EX-10.10

Exhibit 10.10

AVON PRODUCTS, INC.

STOCK OPTION AGREEMENT

Mr. Gustavo Arnal

Chief Financial Officer

Avon Products, Inc.

Dear Gustavo:

In accordance with your contract of employment, dated as of December 11, 2018, with Avon Cosmetics Limited (the “Employment Contract”), Avon Products, Inc. (the “Company”) has granted to you, effective May 1, 2019 (the “Grant Date”), the right and option to purchase from the Company shares of Stock (“Shares”) at an exercise price per Share (the “Exercise Price”) as set forth in your grant notification (the “Option”). The Option is subject to the terms and conditions set forth in this Stock Option Agreement (this “Agreement”) and your grant notification. Please indicate your acceptance of this award by signing this Agreement and returning your signature to Company’s Vice President, Global Compensation & Benefits.

1. Grant of Option. The Option is being awarded to you hereunder outside of the Company’s 2016 Omnibus Incentive Plan (the “Plan”). Notwithstanding that this award is made outside of the Plan, except as otherwise expressly provided in this Agreement and other than as to the Share limitations of Section 5 of the Plan, this Agreement will be interpreted in a manner consistent with the terms of the Plan and all such terms will be deemed to be incorporated into and made a part of this Agreement. All capitalized terms used in this Agreement shall have the meaning set forth in the Plan, unless otherwise defined herein.

2.Exercise of Option.

(a)The Option shall be exercisable in the installments outlined in your grant notification. The entire Option is fully exercisable after the final vesting date. To the extent that any of the installments becomes exercisable, it shall continue to be exercisable at any time thereafter until the Option shall terminate, expire or be surrendered.

(b)Shares may be purchased through exercise of the Option by contacting the Company’s authorized agent: (x) on-line; (y) via the telephone; or (z) through a broker.

You shall designate one, or a combination, of the following methods of purchase:

(i)tender to the Company’s authorized agent of a check for the full Exercise Price of the Shares with respect to which the Option or portion thereof is exercised; or

(ii)by delivery to the Company’s authorized agent of a number of Shares (which may include an attestation of ownership of such Shares) having an aggregate Fair Market Value of not less than the product of (x) the Exercise Price multiplied by (y) the number of Shares you intend to purchase upon exercise of the Option on the date of delivery; or

Exhibit 10.10

(i)instructions to the Company’s authorized agent that Shares acquired as a result of the Option exercise be immediately sold and that the Company’s authorized agent deliver the full Exercise Price to the Company, together with any tax withholdings, whereupon the net cash proceeds and/or Shares shall be forwarded to you. The Company may establish special terms and conditions for this “cashless” exercise and at any time may terminate availability of this form of purchase.

You should be aware that the exercise method as outlined under Section 2(b)(i) and (ii) will result, and the exercise method as outlined under Section 2(b)(iii) may result, in the ownership of Shares and may also require the exchange of local currency into U.S. dollars and the transfer of funds to the U.S. In addition, you will be required to open and use a U.S. based brokerage account. You will personally be responsible for any local compliance requirements in relation to all of the above transactions.

Moreover, you should be aware that regardless of the exercise method used, you will personally be responsible for any local compliance requirements in relation to the transfer of U.S. dollars and the making of a foreign investment, if any. These requirements may change from time to time and the Company may at any time establish special terms and conditions to the exercise of the Option and at any time may terminate or limit the availability of any form of exercise as outlined above, subject to applicable law.

The Company is not responsible for foreign exchange fluctuations between your local currency and the U.S. dollar nor is the Company liable for any decrease in the value of the Shares.

1. Expiration of Option.

(a)The Option shall expire or terminate and may not be exercised to any extent by you as of the first to occur of the following events:

(i)The tenth anniversary of the Grant Date, or such earlier time as the Company may determine is necessary or appropriate in light of applicable laws; or

(ii)The first anniversary of the date your employment with the Company and its Subsidiaries terminates by reason of death or Disability; or

(iii)The third anniversary of the date your employment with the Company and its Subsidiaries terminates by reason of Retirement; or

(iv)The date your employment with the Company and its Subsidiaries terminates for Cause; or

(v)The date that is ninety days after your employment with the Company and its Subsidiaries terminates for a reason other than for Cause, death, Disability or Retirement, but only to the extent the Option is exercisable as of the date of such termination of employment (with any unexercisable portion of the Option terminating on the date of any such termination of employment); or

(vi)Except where void by law and unless otherwise determined by the Committee, your violation of any non-disclosure, non-compete or non-solicitation covenant applicable to you as set forth in Section 5 of this Agreement or any individual agreement between you and the Company or one of its Subsidiaries, or any Company policy, regardless of whether or not you have incurred a termination of employment due to Disability, Retirement or otherwise.

(b)In the event your employment with the Company and its Subsidiaries terminates because of death or Disability, the entire Option shall immediately become exercisable in full, notwithstanding Section 2(a) of this Agreement. In the event your employment with the Company and its Subsidiaries

Exhibit 10.10

terminates after the first anniversary of the Grant Date because of Retirement, the Option shall continue to vest according to the schedule as set forth in your grant notification.

(c)A paid or unpaid leave of absence that has been approved by the Company shall not constitute a termination of your employment with the Company and its Subsidiaries. During such paid or unpaid leave of absence, the Option shall continue to vest according to the schedule set forth in your grant notification. For the avoidance of doubt, vesting of your award during any notice period relating to any termination of your employment by the Company (and, if applicable, by any Subsidiary for whom you are employed) other than for Cause is determined under Section 7(j) of this Agreement.

2.Change in Control. Notwithstanding any other provision of this Agreement, in the event of a Change in Control, the vesting and exercise of the Option shall be governed by the provisions of the Plan regarding a Change in Control as if the Option were granted under the Plan, and such provisions of the Plan are incorporated herein by reference.

3.Non-Competition/Non-Solicitation/Non-Disclosure. You agree that, during the period beginning on the Grant Date and ending on the later of (x) the first anniversary of the date the Option is fully exercised and (y) the first anniversary of your termination of employment with the Company and its Subsidiaries for any reason whatsoever (including, but not limited to with or without Cause, Retirement or Disability), you shall not, without the prior written consent of the Committee, engage in any of the following activities:

(a)directly or indirectly engage or otherwise participate in any business which is competitive with any significant business of the Company or any Subsidiary, including without limitation, your acceptance of employment with, entrance into a consulting or advisory arrangement with, rendering services to or otherwise facilitating the business of Amway Corp./Alticor Inc., Amore Pacific, Arabela, Arbonne, Beiersdorf (Nivea), COTY, De Millus S.A., Ebel Int’l/Belcorp Corp., Elizabeth Arden, Faberlic, Herbalife Ltd., Inter Parfums, Jequiti, Lady Racine/LR Health & Beauty Systems GmbH, LG Health & Household, L’Occitane, L’Oréal Group/Cosmair Inc., Mary Kay Inc., Mistine/Better Way (Thailand) Co. Ltd., Natura Cosmetics S.A., Neways Int’l, NuSkin Enterprises Inc., O Boticário, Oriflame Cosmetics S.A., Origami Owl, Reckitt Benckiser PLC, Revlon Inc., Rodan & Fields, Shaklee Corp., Shiseido, Stella & Dot, Silpada, The Body Shop Int’l PLC, The Estée Lauder Companies Inc., The Procter & Gamble Company, Tupperware Corp., Unilever Group (N.V. and PLC), Vorwerk & Co. KG/Jafra Worldwide Holdings (Lux) S.à.R.L. Inc., Yanbal Int’l (Yanbal, Unique), Younique or any of their affiliates; or

(b)solicit or aid in the solicitation of any employees of the Company or any Subsidiary to leave their employment.

In addition, you shall not, unless compelled pursuant to an order of a court or other body having jurisdiction over such matter, communicate or divulge any secret or confidential information, knowledge or data, including without limitation any trade secrets, relating to the Company or a Subsidiary, and their respective businesses, obtained by you during your employment by the Company or a Subsidiary and which is not otherwise publicly known (other than by reason of an unauthorized act by you), to anyone other than the Company and those designated by it.

In the event the Company determines that you have breached any term of this Section 5 or any non--disclosure, non-compete or non-solicitation covenant set forth in any individual agreement between you and the Company or one of its Subsidiaries, or any Company policy, then in addition to any other remedies the Company may have available to it, unless otherwise determined by the Committee: (i) all unexercised portions of the Option granted hereunder shall terminate to the extent the Option has not been exercised and (ii) if the Option has been exercised, then you shall forfeit all Shares issued to you in connection with the exercise of the Option; provided, however, that the Company shall return to you the lesser of any consideration paid by you in exchange for Shares issued to you hereunder or the Fair Market Value of Shares forfeited hereunder at the time of forfeiture; and provided, further, that if you no longer hold Shares issued to you hereunder, then you shall pay to the Company in cash the excess of the Fair

Exhibit 10.10

Market Value of the Shares issued to you upon exercise of the Option, determined as of the date of such exercise, over any consideration paid by you in exchange for such Shares.

Notwithstanding anything in this Section 5 to the contrary, this Agreement is not intended to, and shall be interpreted in a manner that does not, limit or restrict you from exercising any legally protected whistleblower rights (including pursuant to Rule 21F under the U.S. Securities Exchange Act of 1934).

4. Recoupment. Except where void by law and unless otherwise determined by the Committee, the Option, and the Shares issued to you in connection with the exercise of the Option hereunder, are subject to forfeiture and/or recoupment in the event that you have engaged in misconduct, including: (x) a serious violation of the Company’s Code of Conduct; or (y) a violation of law within the scope of employment with the Company and its Subsidiaries. The Option and any Shares issued to you in connection with the exercise of the Option hereunder are also subject to the Company’s Compensation Recoupment Policy.

5.Service Acknowledgements. You acknowledge and agree as follows:

(a)The execution and delivery of this Agreement and the granting of the Option hereunder shall not constitute or be evidence of any agreement or understanding, express or implied, on the part of the Company or its Subsidiaries to employ you for any specific period.

(b)The award of the Option is voluntary and occasional, and does not entitle you to any benefit other than that specifically granted under this Agreement, or to any future awards or other benefits under the Plan or any similar plan, even if Options have ever been granted in the past or have repeatedly been granted in the past. Any benefits granted under this Agreement and under the Plan are extraordinary and not part of your ordinary or expected compensation or salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, end-of-service payments, bonuses, long-service awards, pension, welfare or retirement benefits or similar payments, and in no event should be considered as compensation for, or relating in any way to, past services for the Company or any of its Subsidiaries.

(c)Nothing in this Agreement shall confer upon you any right to continue in the service of the Company or a Subsidiary or interfere in any way with any right of the Company or a Subsidiary to terminate your employment at any time, subject to applicable law.

(d)You are accepting the Option and entering into this Agreement voluntarily.

(e)The Plan may be modified, amended, suspended or terminated by the Company at any time, to the extent permitted by the Plan.

(f)All decisions with respect to future options or other grants, if any, will be at the sole discretion of the Committee, subject to the terms of the Employment Contract.

(g)The future value of the Shares underlying the Option is unknown, indeterminable and cannot be predicted with certainty. The value of the Shares may increase or decrease.

(h)Neither the Company nor any Subsidiary is providing any tax, legal or financial advice or making any recommendations regarding this award or your acquisition or sale of the Shares.

(i)In consideration of the grant of the Option, (i) you shall have no claim or entitlement to compensation or damages arising from (x) forfeiture of the Option resulting from termination of your service (for any reason whether or not in breach of local law) or otherwise pursuant to the terms of this Agreement or (y) diminution in value of the Option or Shares issued upon exercise of the Option and (ii) you irrevocably release the Company and its Subsidiaries from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by accepting the Option, you shall be deemed irrevocably to have waived your entitlement to pursue such a claim.

(j)Any notice period mandated under the Employment Contract or otherwise arising in connection with an involuntary termination of your employment by the Company (and, if applicable, by

Exhibit 10.10

any Subsidiary for whom you are employed) other than for Cause shall be treated as service for the purpose of determining the vesting of the Option. However, any notice period mandated under applicable law or otherwise for which you receive pay in lieu of notice shall not be treated as service for the purpose of determining the vesting of the Option, and your right to vesting of the Option after termination of service, if any, will be measured by the date of termination of your active service and will not be extended by any such notice period. Similarly, if the Company elects to place you on garden leave (or the equivalent) during any notice period under your Employment Agreement or otherwise arising in connection with an involuntary termination of your employment by the Company (and, if applicable, by any Subsidiary for whom you are employed) other than for Cause, such garden leave period shall not be treated as service for the purpose of determining the vesting of the Options, and your right to settlement of the Options after termination of service, if any, will be measured by the date of termination of your active service (i.e., the commencement of such leave) and will not be extended by any such leave. Subject to the foregoing and the provisions of the Plan, which are incorporated herein by reference, the Company, in its sole discretion, shall determine whether your service has terminated and the effective date of such termination.

(k)The grant of the Option will not be interpreted to form an employment contract or employment relationship with the Company or any of its Subsidiaries that does not otherwise exist.

6.Data Privacy Acknowledgement and Consent. By signing this Agreement, you acknowledge and agree that in order to implement, manage and administer the Option and/or in connection with tax or other governmental and regulatory compliance activities directly or indirectly related to the Option, the Company and/or an entity belonging to the Company’s group of companies (including your employer) may need to process your personal data (electronically or otherwise), including, but not limited to, your name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any Shares or other equity securities, directorships held in the Company, details of all Options or any other entitlement to Shares awarded, canceled, vested, unvested or outstanding in your favor (the “Personal Data”). The transfer of Personal Data to and collection by third-party service providers outside the Company’s group of companies, such as the Company’s authorized agent, may also be necessary in order to implement, manage and administer the Option.

You expressly and unambiguously consent to the collection, use and other processing of Personal Data by the Company, entities belonging to the Company’s group of companies, and third-party service providers. You understand that the Company may transfer your Personal Data to the United States, or other countries which may have a different or lower level of data protection law than your home country and which are not considered by the European Commission or the United Kingdom (should the United Kingdom cease to be a member of the European Economic Area (“EEA”)) or the data protection agencies of other jurisdictions to have data protection laws equivalent to the laws in your country. The Company will therefore maintains an EU-U.S. Privacy Shield certification or enter into an alternate data processing and transfer arrangement authorized by applicable law, such as standard contractual clauses, to protect your Personal Data consistent with data protection laws of the European Union or the United Kingdom (should the United Kingdom cease to be a member of the EEA).

In addition, you expressly and unambiguously consent to the disclosure of Personal Data to, and processing by, a third party in the event of any potential or actual reorganization, merger, sale, joint venture, assignment, transfer or other disposition of all or any portion of the Company’s business, assets or stock (including in connection with any bankruptcy or similar proceedings); and as the Company believes necessary or appropriate: (a) under applicable law, including laws outside of your country; (b) to comply with legal processes; and (c) to respond to requests from public and government authorities including public and government authorities outside of your country.

Exhibit 10.10

You authorize the recipients to receive, possess, use, retain and transfer the Personal Data, in electronic or other form, for the purposes of implementing, managing and administering this Option, including any requisite transfer of such Personal Data as may be required to a broker or other third-party with whom you may elect to deposit any Shares acquired upon exercise of the Option. You understand that Personal Data will be held only as long as is necessary to implement, manage and administer the Option, unless a longer retention period is required by applicable laws, regulations, rules or valid requests or orders of a court or other dispute resolution forums or of a governmental or public authority, in each case, including those of a court or other dispute resolution forums or of a governmental or public authority outside of your country. You understand that you may, at any time, view your Personal Data, request additional information about the storage and processing of your Personal Data, require any necessary amendments to your Personal Data that is incorrect or refuse or withdraw the consents herein, in any case without cost, by contacting in writing your local stock program coordinator.

If you do not consent, or if you later seek to revoke your consent, your employment status or career with the Company or Subsidiary will not be adversely affected; the only adverse consequence of refusing or withdrawing your consent is that the Company would not be able to grant Options under the Plan or other equity awards, or manage or administer such awards. Therefore, you understand that refusing or withdrawing your consent may affect your ability to receive equity awards. For more information on the consequences of your refusal to consent or withdrawal of consent, you understand that you may contact your local stock program coordinator.

If you are a resident of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA), your Personal Data will not be processed on the basis of consent (unless you provide a specific consent separate from this Section 9), but will be processed where necessary to fulfil the Company’s contractual obligations to, where necessary to comply with the Company’s legal obligations under any applicable laws, or to meet the Company’s legitimate business interests. The Company has a legitimate interest in managing its business appropriately including incentivizing its employees, complying with its legal and contractual obligations, and keeping its records accurate and up to date. If you are a resident of the EEA or the United Kingdom (should the United Kingdom cease to be a member of the EEA) you should refer to the Privacy Statement for Associates issued by your employer for additional information about the processing of your Personal Data and your privacy rights. The Privacy Statement for Associates will govern the processing of your Personal Data in connection with the administration of this award.

The Company will take reasonable measures to keep the Personal Data private, confidential and accurate. You may obtain details with respect to the collection, use, processing and transfer of your Personal Data in relation to this award and may also request a list with names and addresses of potential recipients of the Personal Data and/or access to and updates of such Personal Data, if needed, by contacting your local stock program coordinator.

7. Responsibility for Taxes. By accepting this grant, you hereby irrevocably elect to satisfy any taxes and social insurance contribution withholding required to be withheld by the Company or its Subsidiaries on the date of grant, vesting or exercise of the Option or delivery or sale of any Shares hereunder or on any earlier date on which such taxes or social insurance contribution withholding may be due (“Tax Liability”) by authorizing the Company and any of its Subsidiaries to withhold a sufficient number of Shares that would otherwise be deliverable to you upon exercise of the Option. If, for any reason, the Shares that would otherwise be deliverable to you upon exercise of the Option would be insufficient to satisfy the Tax Liability, the Company and any of its Subsidiaries are authorized to withhold an amount from your wages or other compensation sufficient to satisfy the Tax Liability. Furthermore, you agree to pay the Company or its

Exhibit 10.10

Subsidiaries any amount of the Tax Liability that cannot be satisfied through one of the foregoing methods.

Apart from any withholding obligations that may apply to the Company and/or its Subsidiaries, you acknowledge and agree that the ultimate responsibility for the Tax Liability is and remains with you. You further acknowledge that: (x) the Company and its Subsidiaries make no representations or undertakings regarding the Tax Liability or the receipt of any dividends; (y) the Company and its Subsidiaries do not commit to structure the terms of the grant or any other aspect of the Option to reduce or eliminate the Tax Liability; and (z) you should consult a tax adviser regarding the Tax Liability.

You acknowledge that the Company and its Subsidiaries shall have no obligation to deliver Shares until the Tax Liability has been fully satisfied by you.

8. United Kingdom Specific Provisions. The following provisions apply to you as a resident of the United Kingdom. Please appreciate that the information contained in this Section 10 is general in nature and may not apply to your particular situation, and the Company is not in a position to assure you of any particular result. Accordingly, you are advised to seek appropriate professional advice as to how the relevant laws of your home country may apply to your situation. You further understand and agree that if you are a citizen or resident of a country other than the one in which you are currently working, or if your employment transfers after the grant of the Option, or if you are considered a resident of another country for local law purposes, the information contained herein may not apply to you, and the Company shall, in its discretion, determine to what extent the terms and conditions contained herein shall apply, or determine that other terms and conditions are necessary or advisable in order to comply with local law or to facilitate the administration of this Agreement.

(a)Tax and National Insurance Contributions. If the Company determines that it is required to account to HM Revenue & Customs for the Tax Liability and any Secondary NIC Liability or to withhold any other tax as a result of the Option, you, as a condition to the exercise of the Option, shall make arrangements satisfactory to the Company to enable it to satisfy all withholding liabilities. You shall also make arrangements satisfactory to the Company to enable it to satisfy any withholding requirements that may arise in connection with the exercise of the Option or disposition of Shares acquired pursuant to the Option. As a further condition of the vesting of the Option, you may, at the Company’s discretion, be directed to join with the Company, or if and to the extent that there is a change in the law, any of its Subsidiaries or person who is or becomes a Secondary Contributor, in making a Joint Election which has been approved by HM Revenue & Customs, for the transfer of the whole Secondary NIC Liability. To the extent permitted by law, you hereby agree to indemnify and keep indemnified the Company and its Subsidiaries for any Tax Liability.

(b)Securities Disclosure. This Agreement is not an approved prospectus for the purposes of section 85(1) of the Financial Services and Markets Act 2000 (“FSMA”) and no offer of transferable securities to the public (for the purposes of section 102B of FSMA) is being made in connection herewith. This Agreement and the Option are exclusively available to you as a bona fide employee of Avon Cosmetics Limited.

9.Notice. Any notice required to be given hereunder to you shall be addressed to you at your current address shown on the Company’s records. Notice shall be sent by mail, express delivery or, if practical, by electronic delivery or hand delivery.

10.Provisions Inconsistent with Translation. To the extent that you have been provided with a translation of this Agreement, the English language version of this Agreement shall prevail in case of any discrepancies or ambiguities due to translation.

11.Acknowledgement. The Company and you agree that the Option is granted under, and governed by, your grant notification, this Agreement and by those provisions set forth in the Plan that are

Exhibit 10.10

incorporated herein by reference. You: (x) acknowledge receipt of a copy of your grant notification, this Agreement, the Plan and the prospectus relating to this award; (y) represent that you have carefully read and are familiar with their provisions; and (z) hereby accept the Option subject to all of the terms and conditions set forth in your grant notification and this Agreement, including those provisions set forth in the Plan that are incorporated herein by reference.

12.Compliance with Laws and Regulations. The granting of the Option and the delivery of Shares hereunder shall be subject to all applicable laws, rules and regulations. The issuance of Shares will be subject to and conditioned upon compliance by the Company and you with all applicable laws and regulations and with all applicable requirements of any stock exchange or automated quotation system on which the Shares may be listed or quoted at the time of such issuance or transfer. If any provision of this Agreement conflicts with applicable mandatory law, the provisions of such law shall govern.

13.Additional Conditions to Issuance of Shares or Exercise. If at any time the Company determines, in its discretion, that as a condition to the issuance of Shares to you (or your estate) hereunder, it is necessary or desirable to (i) list, register, qualify or comply with the rules of any securities exchange, (ii) qualify or comply with any applicable state, federal or foreign law, including the applicable tax code and related regulations, or (iii) obtain the consent or approval of any governmental regulatory authority or securities exchange, then such issuance will not occur unless and until such listing, registration, qualification, rule compliance, consent or approval is completed, effected or obtained free of any conditions not acceptable to the Company. Where the Company determines that the delivery of Shares hereunder will violate federal securities laws or other applicable law, the Company will defer delivery until the earliest date on which the Company reasonably anticipates that the delivery of Shares hereunder will no longer cause such violation. The Company will make all reasonable efforts to meet the requirements of any such state, federal or foreign law or securities exchange and to obtain any such consent or approval of any such governmental authority or securities exchange.

14.Foreign Exchange. Where applicable, you acknowledge and agree that it is your sole responsibility to investigate and comply with any applicable exchange control laws in connection with the issuance and delivery of Shares pursuant to the exercise of the Option and that you shall be responsible for any reporting of inbound international fund transfers required under applicable law. You are advised to seek appropriate professional advice as to how the exchange control regulations apply to your specific situation. You acknowledge and agree that neither the Company nor any Subsidiary shall be liable for any foreign exchange rate fluctuation between your local currency and the U.S. Dollar that may affect the value of the Option or of any amounts due to you pursuant to the exercise of the Option or the subsequent sale of any Shares acquired upon exercise.

15.Miscellaneous. The Company at any time, and from time to time, may amend the terms of this Agreement; provided, however, that your rights shall not be materially adversely affected without your written consent (except to the extent permitted under the Plan). No waiver by either party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, and each other provision of this Agreement shall be severable and enforceable to the extent permitted by law. In lieu of issuing a fraction of a Share resulting from an adjustment of the Option pursuant to Section 9 of the Plan or otherwise, the Company shall be entitled to pay to you an amount equal to the Fair Market Value of such fractional Share. The terms of this Agreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and to the benefit of you and your beneficiaries, executors, administrators, heirs and successors. The headings of the Sections hereof are provided for convenience only and are not to serve as a basis for interpretation or construction, and shall not constitute a part, of this Agreement.

16.Entire Agreement. This Agreement (including the provisions set forth in the Plan that are incorporated herein by reference) and your grant notification contain the entire agreement and

Exhibit 10.10

understanding of the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations and negotiations in respect thereto (including those provisions of the Employment Contract describing this award).

17.Applicable Law. This Agreement (including those provisions set forth in the Plan that are incorporated herein by reference) and your grant notification, and all actions taken hereunder or under the Plan shall be governed by, and construed in accordance with, the laws of the State of New York without regard to the conflict of law principles thereof.

18.Electronic Delivery and Acceptance. The Company may, in its sole discretion, decide to deliver any documents related to the Option or future options that may be awarded under the Plan by electronic means, or request your consent to participate in the Plan by electronic means. Such means of electronic delivery may include, but do not necessarily include, the delivery of a link to a Company intranet or the Internet site of a third party involved in administering this award or the Plan, the delivery of the document via electronic mail or such other means of electronic delivery specified by the Company. You consent to the electronic delivery of your grant notification, this Agreement, the Plan and the prospectus relating to this award. You acknowledge that you may receive from the Company a paper copy of any documents delivered electronically, at no cost to you, by contacting the Company by telephone or in writing. You further acknowledge that you will be provided with a paper copy of any documents if the attempted electronic delivery of such documents fails. Similarly, you understand that you must provide the Company or any designated third-party administrator with a paper copy of any documents if the attempted electronic delivery of such documents fails. You may revoke your consent to the electronic delivery of documents (or may change the electronic mail address to which such documents are to be delivered to you) at any time by notifying the Company of such revoked consent or revised electronic mail address by telephone, postal service or electronic mail. Finally, you understand that you are not required to consent to electronic delivery of documents.

19.No Advice Regarding Grant. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations or assessments regarding your acceptance of this award, participation in the Plan, or acquisition or sale of the underlying Shares. You are hereby advised to consult with your own personal tax, legal and financial advisors regarding your acceptance of this award and participation in the Plan before taking any action related to the Plan.

20.Counterparts. This Agreement may be executed in one or more counterparts (including via facsimile and electronic image scan (pdf)), each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument and shall become effective when one or more counterparts have been signed by each party and delivered to the other party.

[Signatures on Next Page]

IN WITNESS WHEREOF, the Company, by its duly authorized officer, and you have executed this Agreement as of the Grant Date.

Exhibit 10.10

By your acceptance of this Agreement, you and the Company agree that the Option is granted under and governed by the terms and conditions of your grant notification and this Agreement, including those provisions set forth in the Plan that are incorporated herein by reference. You have reviewed your grant notification, this Agreement, the Plan and the prospectus relating to this award in their entirety, and fully understand all provisions thereof. You have had an opportunity to obtain the advice of counsel prior to executing this Agreement. You hereby agree to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions relating to your grant notification, this Agreement, the Plan and the prospectus relating to this award. You further agree to notify the Company upon any change in your residence address.

AVON PRODUCTS, INC. OPTIONEE

_________________________ Jan Zijderveld, Chief Executive Officer _________________________ Gustavo Arnal

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Jan Zijderveld, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Avon Products, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 1, 2019

/s/ Jan Zijderveld

Jan Zijderveld

Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Gustavo Arnal, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Avon Products, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 1, 2019

/s/ Gustavo Arnal

Gustavo Arnal

Executive Vice President and

Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Avon Products, Inc. (the “Company”) on Form 10-Q for the period ending June 30, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Jan Zijderveld, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Jan Zijderveld

Jan Zijderveld

Chief Executive Officer

August 1, 2019

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Avon Products, Inc. (the “Company”) on Form 10-Q for the period ending June 30, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Gustavo Arnal, Chief Financial Officer, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Gustavo Arnal

Gustavo Arnal

Executive Vice President and

Chief Financial Officer

August 1, 2019

XML

Cover Page	6 Months Ended
	Jun. 30, 2019 shares
Cover page.
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2019
Document Transition Report	false
Entity File Number	1-4881
Entity Incorporation, State or Country Code	NY
Entity Tax Identification Number	13-0544597
Entity Address, Address Line One	Building 6, Chiswick Park
Entity Address, City or Town	London
Entity Address, Postal Zip Code	W4 5HR
Entity Address, Country	GB
Country Region	44
City Area Code	1604
Local Phone Number	232425
Title of 12(b) Security	Common stock, par value $0.25 per share
Trading Symbol	AVP
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding	443,332,735
Entity Registrant Name	AVON PRODUCTS INC
Entity Central Index Key	0000008868
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q2
Amendment Flag	false

XML

Consolidated Statements of Operations - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Revenue	$ 1,174.8	$ 1,351.9	$ 2,361.7	$ 2,745.4
Costs, expenses and other:
Cost of sales	(497.5)	(539.7)	(1,014.5)	(1,119.4)
Selling, general and administrative expenses	(646.8)	(759.2)	(1,320.6)	(1,528.1)
Operating profit	30.5	53.0	26.6	97.9
Interest expense	(30.7)	(34.5)	(63.9)	(70.7)
Loss on extinguishment of debt and credit facilities	0.0	(2.9)	(2.0)	(2.9)
Interest income	1.5	3.5	3.2	7.7
Other income (expense), net	6.8	(19.4)	29.4	(21.9)
Gain on sale of business / assets	13.2	0.0	23.5	0.0
Total other expenses	(9.2)	(53.3)	(9.8)	(87.8)
Income (loss) from continuing operations, before income taxes	21.3	(0.3)	16.8	10.1
Income taxes	(27.2)	(36.7)	(46.7)	(68.2)
Loss from continuing operations, net of tax	(5.9)	(37.0)	(29.9)	(58.1)
Loss from discontinued operations, net of tax	(13.2)	0.0	(22.7)	0.0
Net loss	(19.1)	(37.0)	(52.6)	(58.1)
Net (income) loss attributable to noncontrolling interests	(0.4)	0.9	0.4	1.7
Net loss attributable to Avon	$ (19.5)	$ (36.1)	$ (52.2)	$ (56.4)
Basic
Basic from continuing operations (in dollars per share)	$ (0.03)	$ (0.09)	$ (0.09)	$ (0.15)
Basic from discontinued operations (in dollars per share)	(0.03)	0	(0.05)	0
Basic attributable to Avon (in dollars per share)	(0.06)	(0.09)	(0.14)	(0.15)
Diluted
Diluted from continuing operations (in dollars per share)	(0.03)	(0.09)	(0.09)	(0.15)
Diluted from discontinued operations (in dollars per share)	(0.03)	0	(0.05)	0
Diluted attributable to Avon (in dollars per share)	$ (0.06)	$ (0.09)	$ (0.14)	$ (0.15)
Product sales
Revenue	$ 1,108.8	$ 1,268.8	$ 2,225.0	$ 2,578.4
Other revenue
Revenue	$ 66.0	$ 83.1	$ 136.7	$ 167.0

XML

Consolidated Statements of Comprehensive Loss - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Statement of Comprehensive Income [Abstract]
Net loss	$ (19.1)	$ (37.0)	$ (52.6)	$ (58.1)
Other comprehensive income:
Foreign currency translation adjustments	4.1	(45.5)	1.2	(49.8)
Unrealized (losses) gains on revaluation of long-term intercompany balances, net of taxes	0.3	(81.1)	(0.2)	(44.1)
Change in unrealized gains/losses on cash flow hedges, net of taxes	(0.7)	0.0	(2.6)	0.0
Adjustments of and amortization of net actuarial loss and prior service cost, net of taxes	1.8	2.8	3.1	5.7
Total other comprehensive income (loss), net of income taxes	5.5	(123.8)	1.5	(88.2)
Comprehensive (loss) income	(13.6)	(160.8)	(51.1)	(146.3)
Less: comprehensive income (loss) attributable to noncontrolling interests	0.3	(1.2)	(0.4)	(1.8)
Comprehensive (loss) income attributable to Avon	$ (13.9)	$ (159.6)	$ (50.7)	$ (144.5)

XML

Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Statement of Comprehensive Income [Abstract]
Unrealized gains (losses) on revaluation of long-term intercompany balances, tax	$ 0.0	$ 0.0	$ 0.0	$ 0.0
Change in unrealized gain/losses on cash flow hedges, tax	0.0	0.0	0.0	0.0
Adjustments of and amortization of net actuarial loss and prior service cost, tax	$ 0.2	$ 0.1	$ 0.3	$ 0.3

XML

Consolidated Balance Sheets - USD ($) $ in Millions	Jun. 30, 2019	Dec. 31, 2018
Current Assets
Cash and cash equivalents	$ 421.0	$ 532.7
Accounts receivable, net	332.8	349.7
Inventories	515.6	542.0
Prepaid expenses and other	264.2	272.0
Assets held for sale	10.1	65.6
Total current assets	1,543.7	1,762.0
Property, plant and equipment, at cost	1,177.8	1,207.8
Less accumulated depreciation	(657.6)	(650.2)
Property, plant and equipment, net	520.2	557.6
Right-of-use assets	174.9
Goodwill	89.9	87.4
Deferred tax asset	208.2	212.6
Other assets	434.3	390.4
Total assets	2,971.2	3,010.0
Current Liabilities
Debt maturing within one year	398.5	12.0
Accounts payable	682.2	816.5
Accrued compensation	94.1	85.5
Other accrued liabilities	436.1	451.3
Sales taxes and taxes other than income	116.0	103.9
Income taxes	11.7	15.9
Total current liabilities	1,756.7	1,496.5
Long-term debt	1,197.0	1,581.6
Long-term operating lease liability	144.8
Employee benefit plans	129.6	128.3
Long-term income taxes	140.9	136.2
Other liabilities	54.8	72.1
Total liabilities	3,423.8	3,414.7
Series C convertible preferred stock	504.7	492.1
Shareholders’ Deficit
Common stock	190.7	190.3
Additional paid-in capital	2,307.5	2,303.6
Retained earnings	2,169.5	2,234.3
Accumulated other comprehensive loss	(1,028.9)	(1,030.4)
Treasury stock, at cost	(4,603.3)	(4,602.3)
Total Avon shareholders’ deficit	(964.5)	(904.5)
Noncontrolling interests	7.2	7.7
Total shareholders’ deficit	(957.3)	(896.8)
Total liabilities, series C convertible preferred stock and shareholders’ deficit	2,971.2	3,010.0
Held for sale liabilities
Current Liabilities
Held for sale liabilities	0.0	11.4
Discontinued operations
Current Liabilities
Held for sale liabilities	$ 18.1	$ 0.0

XML

Consolidated Statements of Cash Flows - USD ($) $ in Millions		3 Months Ended		6 Months Ended
		Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Cash Flows from Operating Activities
Net loss		$ (19.1)	$ (37.0)	$ (52.6)	$ (58.1)
Loss from discontinued operations, net of tax		(13.2)	0.0	(22.7)	0.0
Loss from continuing operations, net of tax		(5.9)	(37.0)	(29.9)	(58.1)
Adjustments to reconcile net loss to net cash used by operating activities:
Depreciation		15.9	20.8	36.5	41.6
Amortization		6.2	6.7	12.8	13.8
Provision for doubtful accounts		28.8	43.1	58.7	86.2
Provision for obsolescence		9.5	3.6	16.2	13.3
Share-based compensation		5.7	3.7	5.2	7.5
Foreign exchange losses (gains)		11.9	8.9	(7.3)	13.5
Deferred income taxes		(0.9)	(2.0)	7.3	(0.2)
Impairment loss on assets		13.3	0.0	13.3	0.0
Gain on sale of business / assets		(13.2)	0.0	(23.5)	0.0
Other		3.5	0.0	5.2	3.2
Changes in assets and liabilities:
Accounts receivable		(16.6)	(45.6)	(40.9)	(50.0)
Inventories		13.2	(41.3)	18.0	(99.7)
Prepaid expenses and other		(23.2)	1.6	15.2	1.7
Accounts payable and accrued liabilities		(47.1)	29.7	(211.3)	(76.6)
Income and other taxes		19.2	0.6	7.2	(0.3)
Noncurrent assets and liabilities		(13.2)	(3.2)	(18.3)	(2.6)
Net cash provided (used) by operating activities of continuing operations		7.1	(10.4)	(135.6)	(106.7)
Cash Flows from Investing Activities
Capital expenditures		(11.3)	(20.2)	(32.5)	(48.0)
Disposal of assets		0.4	0.6	0.8	1.4
Net proceeds from sale of business / assets		30.1	0.0	76.5	0.0
Other investing activities		0.0	(3.3)	0.0	(3.3)
Net cash provided (used) by investing activities of continuing operations		19.2	(22.9)	44.8	(49.9)
Cash Flows from Financing Activities
Debt, net (maturities of three months or less)		(26.7)	(14.0)	0.5	(10.4)
Repayment of debt		(0.3)	(238.1)	(0.3)	(238.6)
Repurchase of common stock		(1.1)	(0.5)	(1.1)	(3.2)
Other financing activities		0.0	(0.1)	(9.2)	(0.1)
Net cash used by financing activities of continuing operations		(28.1)	(252.7)	(10.1)	(252.3)
Net cash used by operating activities of discontinued operations		(4.6)	0.0	(4.6)	0.0
Net cash used by discontinued operations		(4.6)	0.0	(4.6)	0.0
Effect of exchange rate changes on cash and cash equivalents, and restricted cash		4.0	(42.6)	(2.3)	(28.7)
Net decrease in cash and cash equivalents, and restricted cash		(2.4)	(328.6)	(107.8)	(437.6)
Cash and cash equivalents, and restricted cash at beginning of year	[1]	431.0	772.5	536.4	881.5
Cash and cash equivalents, and restricted cash at end of period	[2]	$ 428.6	$ 443.9	$ 428.6	$ 443.9

[1] The balance at the beginning of the six month period ended June 30, 2019 includes cash and cash equivalents of $3.7 classified as Held for sale assets in our Consolidated Balance Sheets at the end of the year in 2018

[2] Includes restricted cash of $7.6 related to the sale of Avon Manufacturing (Guangzhou), Ltd. at June 30, 2019

XML

Consolidated Statements of Cash Flows - Parenthetical - USD ($) $ in Millions	Jun. 30, 2019	Dec. 31, 2018
Statement of Cash Flows [Abstract]
Cash and cash equivalents classified as Held for sale assets	$ 0.0	$ 3.7
Restricted cash	$ 7.6

XML

Consolidated Statements of Changes in Shareholders' Equity (Deficit) Statement - USD ($) shares in Millions, $ in Millions	Total	Common Stock	Additional Paid-in Capital	Retained Earnings	AOCI Attributable to Parent	Treasury Stock	Noncontrolling Interest
Beginning balance (in shares) at Dec. 31, 2017		758.7				318.4
Beginning balance at Dec. 31, 2017	$ (714.7)	$ 189.7	$ 2,291.2	$ 2,320.3	$ (926.2)	$ (4,600.0)	$ 10.3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(21.1)			(20.3)			(0.8)
Other comprehensive income (loss)	35.6				35.2		0.4
Dividends accrued - Series C convertible preferred stock	(6.0)			(6.0)
Exercise/ vesting/ expense of share-based compensation (in shares)		2.2				(0.1)
Exercise/ vesting/ expense of share-based compensation	3.6	$ 0.6	2.5	(0.4)		$ 0.9
Repurchase of common stock (in shares)						0.9
Repurchase of common stock	(2.7)					$ (2.7)
Purchases and sales of noncontrolling interests, net of dividends paid	(0.2)						(0.2)
Ending balance (in shares) at Mar. 31, 2018		760.9				319.2
Ending balance at Mar. 31, 2018	(746.6)	$ 190.3	2,293.7	2,252.5	(891.0)	$ (4,601.8)	9.7
Net Income (Loss) Attributable to Parent	(56.4)
Beginning balance (in shares) at Dec. 31, 2017		758.7				318.4
Beginning balance at Dec. 31, 2017	(714.7)	$ 189.7	2,291.2	2,320.3	(926.2)	$ (4,600.0)	10.3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(58.1)
Other comprehensive income (loss)	(88.2)
Ending balance (in shares) at Jun. 30, 2018		761.7				319.4
Ending balance at Jun. 30, 2018	(910.5)	$ 190.3	2,297.5	2,210.0	(1,014.4)	$ (4,602.3)	8.4
Net Income (Loss) Attributable to Parent	(36.1)
Beginning balance (in shares) at Mar. 31, 2018		760.9				319.2
Beginning balance at Mar. 31, 2018	(746.6)	$ 190.3	2,293.7	2,252.5	(891.0)	$ (4,601.8)	9.7
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(37.0)			(36.1)			(0.9)
Other comprehensive income (loss)	(123.8)				(123.4)		(0.4)
Dividends accrued - Series C convertible preferred stock	(6.0)			(6.0)
Exercise/ vesting/ expense of share-based compensation (in shares)		0.8
Exercise/ vesting/ expense of share-based compensation	3.4		3.8	(0.4)
Repurchase of common stock (in shares)						0.2
Repurchase of common stock	(0.5)					$ (0.5)
Ending balance (in shares) at Jun. 30, 2018		761.7				319.4
Ending balance at Jun. 30, 2018	(910.5)	$ 190.3	2,297.5	2,210.0	(1,014.4)	$ (4,602.3)	8.4
Beginning balance (in shares) at Dec. 31, 2018		761.8				319.4
Beginning balance at Dec. 31, 2018	(896.8)	$ 190.3	2,303.6	2,234.3	(1,030.4)	$ (4,602.3)	7.7
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(33.5)			(32.7)			(0.8)
Other comprehensive income (loss)	(3.9)				(4.0)		0.1
Dividends accrued - Series C convertible preferred stock	(6.2)			(6.2)
Exercise/ vesting/ expense of share-based compensation (in shares)		1.3
Exercise/ vesting/ expense of share-based compensation	(1.2)	$ 0.3	(1.5)
Purchases and sales of noncontrolling interests, net of dividends paid	0.1						0.1
Ending balance (in shares) at Mar. 31, 2019		763.1				319.4
Ending balance at Mar. 31, 2019	(941.5)	$ 190.6	2,302.1	2,195.4	(1,034.4)	$ (4,602.3)	7.1
Net Income (Loss) Attributable to Parent	(52.2)
Beginning balance (in shares) at Dec. 31, 2018		761.8				319.4
Beginning balance at Dec. 31, 2018	(896.8)	$ 190.3	2,303.6	2,234.3	(1,030.4)	$ (4,602.3)	7.7
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(52.6)
Other comprehensive income (loss)	1.5
Ending balance (in shares) at Jun. 30, 2019		763.2				319.9
Ending balance at Jun. 30, 2019	(957.3)	$ 190.7	2,307.5	2,169.5	(1,028.9)	$ (4,603.3)	7.2
Net Income (Loss) Attributable to Parent	(19.5)
Beginning balance (in shares) at Mar. 31, 2019		763.1				319.4
Beginning balance at Mar. 31, 2019	(941.5)	$ 190.6	2,302.1	2,195.4	(1,034.4)	$ (4,602.3)	7.1
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(19.1)						0.4
Other comprehensive income (loss)	5.5						0.0
Dividends accrued - Series C convertible preferred stock	(6.4)			(6.4)
Exercise/ vesting/ expense of share-based compensation	5.4		5.4
Repurchase of common stock (in shares)		0.1				0.5
Repurchase of common stock	(1.0)	$ (0.1)				$ (1.0)
Purchases and sales of noncontrolling interests, net of dividends paid	(0.3)						(0.3)
Ending balance (in shares) at Jun. 30, 2019		763.2				319.9
Ending balance at Jun. 30, 2019	$ (957.3)	$ 190.7	$ 2,307.5	$ 2,169.5	$ (1,028.9)	$ (4,603.3)	$ 7.2

XML

Consolidated Statements of Changes in Shareholders' Equity (Deficit) - Parenthetical - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Mar. 31, 2018	Jun. 30, 2019
Statement of Stockholders' Equity [Abstract]
Dividends	$ 0	$ 0	$ 0.1

XML

ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2019

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 2018 Annual Report on Form 10-K ("2018 Form 10-K") in preparing these unaudited interim Consolidated Financial Statements, other than those impacted by new accounting standards as described below. 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 2018 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 generally provide for accruals under our various employee benefit plans for each quarter based on one quarter of the estimated annual expense, and adjust these accruals as estimates are refined. 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 for which an effective tax rate cannot be reliably estimated.

Accounting Standards Implemented

Leases

In February 2016, the FASB issued ASU 2016-02, Leases, which requires all assets and liabilities arising from leases to be recognized in our Consolidated Balance Sheets. We adopted this new accounting guidance effective January 1, 2019.

In July 2018, the FASB added an optional transition method which we elected upon adoption of the new standard. This allowed us to recognize and measure leases existing at January 1, 2019 without restating comparative information. In addition, we elected to apply the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allows us to carry forward the historical lease classification.

We determine if an arrangement is a lease at the lease commencement date. In addition to our lease agreements, we review all material new vendor arrangements for potential embedded lease obligations. The asset balance related to operating and finance leases is presented within right-of-use (ROU) asset and property, plant and equipment, respectively, on our Consolidated Balance Sheet. The short-term liability balance related to operating and finance leases is presented within other accrued liabilities on our Consolidated Balance Sheets. The long-term liability balance is presented within long-term operating lease liability and long-term debt on our Consolidated Balance Sheets for operating and finance leases, respectively.  

The lease liability is recognized based on the present value of the remaining fixed or in-substance fixed lease payments discounted using our incremental borrowing rates. We use a specific incremental borrowing rate for our material leases, which is determined based on the geography and term of the lease. These rates are determined based on inputs provided by external banks and updated periodically. The lease liability includes the exercise of a purchase option only if we are reasonably certain to exercise as of the commencement date of the lease. The residual value guarantee amount is only included in the lease liability calculation to the extent payment is probable to the lessor as of the commencement of the lease. The ROU asset is calculated based on the lease liability adjusted for any lease payments paid to the lessor at or before the commencement date (i.e. prepaid rent) and initial direct costs incurred by Avon and excluding any lease incentives received from the Lessor.

Variable lease payments are payments to the lessor not included in the lease liability calculation. We define variable lease payments as payments made by Avon to the lessor for the right to use a leased asset that vary because of changes in facts or circumstances (such as changes in an index rate, volume, usage, etc.) occurring after the lease commencement date, other than predetermined contractual changes due to the passage of time (for example, predetermined rent increase amounts that are set out in the contract). Variable lease payments or charges are accounted for as incurred.

The lease term for purposes of lease accounting may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option as of the commencement date of the lease. For operating leases, the lease expense is recognized on a straight-line basis over the lease term. For finance leases, the Company amortizes the ROU asset on a straight-line basis and records interest expense on the lease liability created at lease commencement over the lease term.

We account for our lease and non-lease components as a single component for most of our asset classes, and therefore both are included in the calculation of lease liability recognized on the Consolidated Balance Sheets. However, for certain lease asset classes related to identified embedded leases we account for the lease and non-lease components separately, and therefore, the non-lease component is not included in the lease liability.

Leases with an initial term of twelve months or less are not recorded on the balance sheet; we recognize lease expense for these leases over their lease term. See Note 9, Leases, for further details.

ASU 2018-02, Income Statement - Reporting Comprehensive Income

In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income, which permits entities to reclassify the disproportionate income tax effects of the 2017 enactment of U.S. tax reform legislation (the "Act") on items within accumulated other comprehensive income (loss) to retained earnings. We adopted this new accounting guidance effective January 1, 2019 and elected not to reclassify the disproportionate income tax effects of the Act from accumulated other comprehensive income (loss) to retained earnings.

Accounting Standards to be Implemented

ASU 2016-13, Financial Instruments - Credit Losses

In January 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses, which requires measurement and recognition of expected credit losses for financial assets held. We intend to adopt this new accounting guidance effective January 1, 2020. We are currently assessing the impact on our consolidated financial statements.

XML

LOSS PER SHARE AND SHARE REPURCHASES

6 Months Ended

Jun. 30, 2019

Earnings Per Share [Abstract]

LOSS PER SHARE AND SHARE REPURCHASES

LOSS PER SHARE AND SHARE REPURCHASES

We compute loss per share ("EPS") using the two-class method, which is a loss allocation formula that determines loss per share for common stock, and 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 June 30,						Six Months Ended June 30,
(Shares in millions)	2019			2018			2019			2018
Numerator from continuing operations:
Loss from continuing operations, less amounts attributable to noncontrolling interests	$	(6.3	)	$	(36.1	)	$	(29.5	)	$	(56.4	)
Less: Loss allocated to participating securities	(.1		)	(.4		)	(.4		)	(.6		)
Less: Cumulative dividends on preferred stock	6.3			6.0			12.6			12.0
Loss from continuing operations allocated to common shareholders	(12.5		)	(41.7		)	(41.7		)	(67.8		)
Numerator from discontinued operations:
Loss from discontinued operations	$	(13.2	)	$	—		$	(22.7	)	$	—
Less: Loss allocated to participating securities	(.2		)	—			(.3		)	—
Loss allocated to common shareholders	(13.0		)	—			(22.4		)	—
Numerator attributable to Avon:
Net loss attributable to Avon	$	(19.5	)	$	(36.1	)	$	(52.2	)	$	(56.4	)
Less: Loss allocated to participating securities	(.3		)	(.4		)	(.7		)	(.6		)
Less: Cumulative dividends on preferred stock	6.3			6.0			12.6			12.0
Loss allocated to common shareholders	(25.5		)	(41.7		)	(64.1		)	(67.8		)
Denominator:
Basic EPS weighted-average shares outstanding	442.3			442.2			442.5			441.5
Diluted effect of assumed conversion of stock options	.2			—			.1			—
Diluted effect of assumed conversion of preferred stock	—			—			—			—
Diluted EPS adjusted weighted-average shares outstanding	442.5			442.2			442.6			441.5
Loss per Common Share from continuing operations:
Basic	$	(.03	)	$	(.09	)	$	(.09	)	$	(.15	)
Diluted	(.03		)	(.09		)	(.09		)	(.15		)
Loss per Common Share from discontinued operations:
Basic	$	(.03	)	$	—		$	(.05	)	$	—
Diluted	(.03		)	—			(.05		)	—
Loss per Common Share attributable to Avon:
Basic	$	(.06	)	$	(.09	)	$	(.14	)	$	(.15	)
Diluted	(.06		)	(.09		)	(.14		)	(.15		)

Amounts in the table above may not necessarily sum due to rounding.

During the three and six months ended June 30, 2019, we did not include stock options to purchase 19.4 million and 18.8 million shares, respectively, of Avon common stock in the calculation of diluted EPS as we had a net loss and the inclusion of these shares would decrease the net loss per share. Since the inclusion of such shares would be anti-dilutive, these are excluded from the calculation. During the three and six months ended June 30, 2018, we did not include stock options to purchase 18.5 million shares and 17.4 million shares, respectively, for the same reason.

For the three and six months ended June 30, 2019 and 2018, respectively, it is more dilutive to assume the series C convertible preferred stock is not converted into common stock; therefore, the weighted-average shares outstanding were not adjusted by the as-if converted series C convertible preferred stock because the effect would be anti-dilutive. The inclusion of the series C convertible preferred stock would decrease the net loss per share for the three months ended June 30, 2019 and 2018. 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 and six months ended June 30, 2019 and 2018. See Note 6, Related Party Transactions.

We purchased approximately .4 million shares of Avon common stock for $1.1 during the first six months of 2019, as compared to approximately 1.1 million shares of Avon common stock for $3.2 during the first six months of 2018, through acquisition of stock from employees in connection with tax payments upon the vesting of restricted stock units and performance restricted stock units.

XML

DISCONTINUED OPERATIONS, ASSETS AND LIABILITIES HELD FOR SALE AND DIVESTITURES

6 Months Ended

Jun. 30, 2019

Discontinued Operations and Disposal Groups [Abstract]

DISCONTINUED OPERATIONS, ASSETS AND LIABILITIES HELD FOR SALE AND DIVESTITURES

DISCONTINUED OPERATIONS, ASSETS AND LIABILITIES HELD FOR SALE AND DIVESTITURES

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 6, 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 (an affiliate of Cerberus). These transactions closed on March 1, 2016.

The Company incurred costs during the three and six months ended June 30, 2019 following the resolution of certain contingent liabilities related to its ownership and operation of the North America business prior to its separation into New Avon. These costs are reported as discontinued operations related to New Avon.

The major classes of financial statement components comprising the loss on discontinued operations, net of tax for New Avon are shown below:

	Three Months Ended June 30, 2019			Six Months Ended June 30, 2019
Selling, general and administrative expenses	$	13.2		$	22.7
Operating loss	$	(13.2	)	$	(22.7	)
Loss from discontinued operations, net of tax	$	(13.2	)	$	(22.7	)

There were no amounts recorded in discontinued operations for the three and six months ended June 30, 2018. See Note 5, Investment in New Avon, for additional information relating to New Avon.

Assets and Liabilities Held for Sale

The major classes of assets and liabilities comprising Held for sale assets and Held for sale liabilities on the Consolidated Balance Sheets as of June 30, 2019 and December 31, 2018 are shown in the following table.

	June 30, 2019
Current Held for sale assets
Property, Plant & Equipment (net)	$	10.1
	$	10.1

	December 31, 2018
	Avon Manufacturing (Guangzhou)		Rye Office		Malaysia Maximin		Total
Current held for sale assets
Inventories	$	8.7	$	—	$	—	$	8.7
Property, Plant & Equipment (net)	36.7		12.3		3.0		52.0
Cash and cash equivalents	3.7		—		—		3.7
Other assets	1.1		—		.1		1.2
	$	50.2	$	12.3	$	3.1	$	65.6
Current held for sale liabilities
Accounts payable	$	8.6	$	—	$	—	$	8.6
Other liabilities	2.6		—		.2		2.8
	$	11.2	$	—	$	.2	$	11.4

During the second quarter of 2019, the Company, in line with the Open Up Avon strategy, identified two properties to be sold which met the held for sale criteria under ASC 360 as of June 30, 2019. The Company expects to close these transactions within the year.

Refer to Divestitures section below for the sale of Avon Manufacturing (Guangzhou), Rye Office and Malaysia Maximin.

Divestitures

Rye Office

On June 26, 2019, we completed the sale of the Rye office for a selling price of $23.2, less expenses of approximately $0.8, resulting in proceeds of $22.4. These proceeds are presented as investing activities in the Consolidated Statement of Cash Flows.

In the second quarter of 2019, we recorded a gain on sale of $9.9 before and after tax, which is reported separately in the Consolidated Statements of Operations. The gain recorded represents the difference between the proceeds and the carrying value of the Rye office on the date of sale. During the first quarter of 2019, we refined the calculation for the Held for sale assets which gave rise to an additional $0.2 in assets.

Malaysia Maximin

On May 9, 2019, we completed the sale of all of the equity interests in Maximin Corporation Sdn Bhd ("Malaysia Maximin") for a total purchase price of $7.8. The cash proceeds of $7.6, net of expenses, are presented within investing activities in the Consolidated Statement of Cash Flows.

In the second quarter of 2019, we recorded a gain on sale of $3.3 before tax, which is reported separately in the Consolidated Statements of Operations, and $3.0 after tax. The gain recorded represents the difference between the proceeds and the carrying value of Malaysia Maximin on the date of sale. During the second quarter of 2019, we refined the calculation for the Held for sale assets which gave rise to an additional $1.4 in assets.

China manufacturing

On February 15, 2019, we completed the sale to TheFaceShop Co., Ltd., an affiliate of LG Household & Health Care Ltd., of all of the equity interests in Avon Manufacturing (Guangzhou), Ltd. for a total purchase price of $71.0, less expenses of approximately $1.1. The purchase price included $23.5 relating to outstanding intercompany loans payable to Avon Manufacturing (Guangzhou), Ltd. from other Avon subsidiaries, that was presented as financing activities in the Consolidated Statement of Cash Flows when settled in April 2019. The cash proceeds of $46.4, net of loan amounts, are presented as investing activities in the Consolidated Statement of Cash Flows, which includes $7.6 of restricted cash as of June 30, 2019, refer to Note 4, Restricted Cash.

In the first quarter of 2019, we recorded a gain on sale of $10.3 before tax, which is reported separately in the Consolidated Statements of Operations, and $8.2 after tax, representing the difference between the proceeds, including the settlement of the intercompany loans, and the carrying value of Avon Manufacturing (Guangzhou), Ltd. on the date of sale.

XML

RESTRICTED CASH

6 Months Ended

Jun. 30, 2019

Restricted Cash and Cash Equivalents [Abstract]

Restricted Cash

RESTRICTED CASH

Restricted cash is related to the sale of Avon Manufacturing (Guangzhou), Ltd. as described in Note 3, Discontinued Operations, Assets and Liabilities Held for Sale and Divestitures.

Restricted cash is subject to legal restrictions imposed by the Equity Purchase Agreement between TheFaceShop Co., Ltd., an affiliate of LG Household & Health Care Ltd., Avon Asia Holdings Company and Avon Products (China) Co., Ltd. related to the sale of Avon Manufacturing (Guangzhou), Ltd. These deposits are not available for general use by the Company.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the Consolidated Balance Sheet that sum to the total of the same such amounts shown in the Consolidated Statement of Cash Flows for the six month period ended June 30, 2019.

	June 30, 2019		December 31, 2018
Cash and cash equivalents	$	421.0	$	532.7
Long-term restricted cash(1)	7.6		—
Held for sale cash and cash equivalents	—		3.7
Cash and cash equivalents, and restricted cash at end of period per the statement of cash flows	$	428.6	$	536.4

⁽¹⁾ Long-term restricted cash is presented in other assets in our Consolidated Balance Sheets.

XML

INVESTMENT IN NEW AVON

6 Months Ended

Jun. 30, 2019

Equity Method Investments and Joint Ventures [Abstract]

INVESTMENT IN NEW AVON

INVESTMENT IN NEW AVON

In connection with the separation of the Company's North America business, which closed on March 1, 2016, the Company retained a 19.9% ownership interest in New Avon, a privately-held company that is majority-owned and managed by an affiliate of Cerberus.

Our recorded investment balance in New Avon at June 30, 2019 and December 31, 2018 was zero.

In April 2019, we signed an agreement with LG Household & Health Care Ltd. to sell our 19.9% ownership interest in New Avon.

LG Household & Health Care Ltd. will acquire all of the interests of New Avon for $125.0 in cash, of which Avon will receive $24.9 in cash for our 19.9% share. The closing is expected to occur during the third quarter of 2019.

In the second quarter of 2019 we incurred costs relating to this transaction of $1.0.

XML

RELATED PARTY TRANSACTIONS

6 Months Ended

Jun. 30, 2019

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

The following tables present the related party transactions with New Avon, affiliates of Cerberus and the Instituto Avon in Brazil. There are no other related party transactions. New Avon is majority-owned and managed by Cerberus. See Note 5, Investment in New Avon for further details.

	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
Statement of Operations Data
Revenue from sale of product to New Avon(1)	$	3.7		$	7.1		$	8.5		$	13.0
Gross profit from sale of product to New Avon(1)	$	—		$	.4		$	.1		$	.7
Cost of sales for purchases from New Avon(2)	$	.8		$	.7		$	1.5		$	1.2
Selling, general and administrative expenses related to New Avon:
Transition services, intellectual property, technical support and innovation and subleases(3)	$	(.1	)	$	(.5	)	$	(.2	)	$	(3.7	)
Project management team(4)	2.1			.2			$	3.4		$	.8
Net reduction of selling, general and administrative expenses	$	2.0		$	(.3	)	$	3.2		$	(2.9	)
Interest income from Instituto Avon(5)	$	.1		$	—		$	.1		$	—

	June 30, 2019		December 31, 2018
Balance Sheet Data
Inventories(6)	$	.2	$	.3
Receivables due from New Avon(7)	$	3.0	$	7.0
Receivables due from Instituto Avon(5)	$	3.3	$	3.2
Payables due to New Avon(8)	$	1.0	$	.2
Payables due to an affiliate of Cerberus(9)	$	4.1	$	.6

(1) The Company supplies product to New Avon as part of a manufacturing and supply agreement.

(2) New Avon supplies product to the Company as part of the same manufacturing and supply agreement noted above. The Company purchased $.6 and $.5 from New Avon associated with this agreement during the three months ended June 30, 2019 and 2018, respectively, and recorded $.8 and $.7 associated with these purchases within cost of sales in our Consolidated Statement of Operations during the three months ended June 30, 2019 and 2018, respectively. The Company purchased $1.4 and $1.2 from New Avon associated with this agreement during the six months ended June 30, 2019 and 2018, respectively, and recorded $1.5 and $1.2 associated with these purchases within cost of sales in our Consolidated Statement of Operations during the six months ended June 30, 2019 and 2018, respectively.

(3) The Company also entered into a transition services agreement to provide certain services to New Avon, which expired on October 31, 2018, as well as an intellectual property ("IP") license agreement, an agreement for technical support and innovation and sublease for office space. The net amounts recorded within selling, general and administrative expenses generally represent 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 implementation of the Company’s strategic initiatives. The Company recorded net cost of $2.1 and $.2 in selling, general and administrative expenses associated with these agreements during the three months ended June 30, 2019 and 2018, respectively, and recorded $3.4 and $.8 in selling, general and administrative expenses associated with these agreements during the six months ended June 30, 2019 and 2018, respectively. See Note 15, Restructuring Initiatives for additional information related to the Company's strategic initiatives.

(5) During the second quarter of 2018, the Company entered into an agreement to loan the Instituto Avon, an independent non-government charitable organization in Brazil, R$12 million (Brazilian real) for an unsecured 5-year term at a fixed interest rate of 7% per annum, to be paid back in 5 equal annual installments. The Instituto Avon was created by an Avon subsidiary in Brazil,

with the board and executive team comprised of Avon Brazil management. The purpose of the loan is to provide the Instituto Avon with the means to donate funds to Fundação Pio XII (a leading cancer prevention and treatment organization in Brazil and owner of the Hospital do Câncer de Barretos), in order to invest in equipment with the objective of expanding breast cancer prevention and treatment.

(6) 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 our Consolidated Balance Sheets.

(7) The receivables due from New Avon relate to the agreements for transition services, the IP license agreement, technical support and innovation and subleases for office space, as well as the manufacturing and supply agreement, and were classified within prepaid expenses and other in our Consolidated Balance Sheets.

(8) The payables due to New Avon relate to the manufacturing and supply agreement and were classified within other accrued liabilities in our Consolidated Balance Sheets.

(9) 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 our 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 June 30, 2019, the Company has a liability of $.8 for the estimated value of such standby letters of credit.

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 $78.0 as of June 30, 2019. Series C convertible preferred stock and accrued dividends of $504.7 on the Consolidated Balance Sheet at June 30, 2019 is stated net of $8.7 of costs incurred in connection with the issuance of the Series C convertible preferred stock in 2016. There were no dividends declared in the six months ended June 30, 2019 and 2018.

XML

REVENUE

6 Months Ended

Jun. 30, 2019

Revenue from Contract with Customer [Abstract]

Revenue

REVENUE

Disaggregation of revenue

In the following table, revenue is disaggregated by product or service type. All revenue is recognized at a point in time when control of a product is transferred to a customer:

	Three Months Ended June 30, 2019
	Reportable segments
	Europe, Middle East & Africa		South Latin America			North Latin America		Asia Pacific		Total reportable segments			Other operating segments and business activities		Total
Beauty:
Skincare	$	136.6	$	130.1		$	49.9	$	29.3	$	345.9		$	—	$	345.9
Fragrance	123.8		114.5			45.6		19.2		303.1			—		303.1
Color	82.0		66.7			21.2		10.9		180.8			—		180.8
Total Beauty	342.4		311.3			116.7		59.4		829.8			—		829.8
Fashion & Home:
Fashion	55.2		41.3			19.9		39.8		156.2			—		156.2
Home	6.4		62.0			47.0		7.4		122.8			—		122.8
Total Fashion & Home	61.6		103.3			66.9		47.2		279.0			—		279.0
Product sales	404.0		414.6			183.6		106.6		1,108.8			—		1,108.8
Representative fees	21.0		28.8			10.2		1.7		61.7			—		61.7
Other	.1		(.4		)	—		.1		(.2		)	4.5		4.3
Other revenue	21.1		28.4			10.2		1.8		61.5			4.5		66.0
Total revenue	$	425.1	$	443.0		$	193.8	$	108.4	$	1,170.3		$	4.5	$	1,174.8

	Three Months Ended June 30, 2018
	Reportable segments
	Europe, Middle East & Africa		South Latin America		North Latin America		Asia Pacific		Total reportable segments		Other operating segments and business activities		Total
Beauty:
Skincare	$	154.4	$	143.9	$	43.8	$	30.3	$	372.4	$	2.3	$	374.7
Fragrance	143.8		131.5		52.4		20.1		347.8		.7		348.5
Color	98.1		80.6		20.8		12.9		212.4		1.4		213.8
Total Beauty	396.3		356.0		117.0		63.3		932.6		4.4		937.0
Fashion & Home:
Fashion	72.9		49.9		22.5		40.7		185.8		1.3		187.1
Home	7.6		72.5		56.6		7.5		144.3		.4		144.7
Total Fashion & Home	80.5		122.4		79.1		48.2		330.1		1.7		331.8
Product sales	476.8		478.4		196.1		111.5		1,262.7		6.1		1,268.8
Representative fees	23.7		35.2		11.2		1.5		71.6		.5		72.1
Other	.2		2.6		—		.1		2.9		8.1		11.0
Other revenue	23.9		37.8		11.2		1.6		74.5		8.6		83.1
Total revenue	$	500.7	$	516.1	$	207.3	$	113.1	$	1,337.2	$	14.7	$	1,351.9

	Six Months Ended June 30, 2019
	Reportable segments
	Europe, Middle East & Africa		South Latin America		North Latin America		Asia Pacific		Total reportable segments		Other operating segments and business activities		Total
Beauty:
Skincare	$	275.7	$	256.8	$	100.2	$	62.5	$	695.2	$	—	$	695.2
Fragrance	257.7		212.8		93.6		37.0		601.1		—		601.1
Color	175.9		126.9		43.1		24.1		370.0		—		370.0
Total Beauty	709.3		596.5		236.9		123.6		1,666.3		—		1,666.3
Fashion & Home:
Fashion	115.7		80.1		42.0		82.7		320.5		—		320.5
Home	14.9		122.2		87.3		13.8		238.2		—		238.2
Total Fashion & Home	130.6		202.3		129.3		96.5		558.7		—		558.7
Product sales	839.9		798.8		366.2		220.1		2,225.0		—		2,225.0
Representative fees	43.5		58.3		20.3		3.5		125.6		—		125.6
Other	.4		.6		—		.1		1.1		10.0		11.1
Other revenue	43.9		58.9		20.3		3.6		126.7		10.0		136.7
Total revenue	$	883.8	$	857.7	$	386.5	$	223.7	$	2,351.7	$	10.0	$	2,361.7

	Six Months Ended June 30, 2018
	Reportable segments
	Europe, Middle East & Africa		South Latin America		North Latin America		Asia Pacific		Total reportable segments		Other operating segments and business activities		Total
Beauty:
Skincare	$	323.8	$	285.7	$	90.5	$	61.6	$	761.5	$	7.0	$	768.5
Fragrance	307.0		250.0		106.0		38.7		701.8		2.9		704.7
Color	218.8		161.5		41.6		26.1		448.1		4.7		452.8
Total Beauty	849.6		697.2		238.1		126.4		1,911.4		14.6		1,926.0
Fashion & Home:
Fashion	152.6		96.4		45.1		80.4		374.5		3.0		377.5
Home	16.9		144.4		97.9		14.5		273.6		1.3		274.9
Total Fashion & Home	169.5		240.8		143.0		94.9		648.1		4.3		652.4
Product sales	1,019.1		938.0		381.1		221.3		2,559.5		18.9		2,578.4
Representative fees	49.7		71.5		21.8		3.1		146.1		1.9		148.0
Other	.3		3.7		—		.1		4.1		14.9		19.0
Other revenue	50.0		75.2		21.8		3.2		150.2		16.8		167.0
Total revenue	$	1,069.1	$	1,013.2	$	402.9	$	224.5	$	2,709.7	$	35.7	$	2,745.4

Contract balances

The timing of revenue recognition generally is different from the timing of a promise made to a Representative. As a result, we have contract liabilities, which primarily relate to the advance consideration received from Representatives prior to transfer of the

related good or service for material rights, such as loyalty points and status programs, and are primarily classified within other accrued liabilities (with the long-term portion in other liabilities) in our Consolidated Balance Sheets.

Generally, we record accounts receivable when we invoice a Representative. In addition, we record an estimate of an allowance for doubtful accounts on receivable balances based on an analysis of historical data and current circumstances, including seasonality and changing trends. The allowance for doubtful accounts is reviewed for adequacy, at a minimum, on a quarterly basis. We generally have no detailed information concerning, or any communication with, any ultimate consumer of our products beyond the Representative. We have no legal recourse against the ultimate consumer for the collection of any accounts receivable balances due from the Representative to us. If the financial condition of the Representatives were to deteriorate, resulting in their inability to make payments, additional allowances may be required.

The following table provides information about receivables and contract liabilities from contracts with customers at June 30, 2019 and December 31, 2018:

	June 30, 2019		December 31, 2018
Accounts receivable, net of allowances of $72 and $93	$	332.8	$	349.7
Contract liabilities	$	55.7	$	84.4

The contract liability balances relate to certain material rights (loyalty points, status program and prospective discounts). During the six months ended June 30, 2019, we recognized $63.4 of revenue related to the contract liability balance at the beginning of the six month period ended June 30, 2019, as the result of performance obligations satisfied. In addition, we deferred an additional $34.5 related to certain material rights granted during the period, for which the performance obligations are not yet satisfied. Of the amount deferred during the period, substantially all will be recognized within a year, with the significant majority to be captured within a quarter. The remaining movement in the contract liability balance is attributable to foreign exchange differences arising on the translation of the balance as at June 30, 2019 as compared with December 31, 2018.

Contract costs

Incremental costs to obtain contracts, such as bonuses or commissions, are recognized as an asset if the entity expects to recover them. However, ASC 340-40, Other Assets and Deferred Costs, offers a practical expedient to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that the entity otherwise would have recognized is one year or less. We elected the practical expedient and expense costs to obtain contracts when incurred because our amortization period is one year or less.

Costs to fulfill contracts with Representatives are comprised of shipping and handling (including order processing) and payment processing services, which are expensed as incurred. The fees for these services are included in the transaction price.

XML

INVENTORIES

6 Months Ended

Jun. 30, 2019

Inventory Disclosure [Abstract]

INVENTORIES

INVENTORIES

Components of Inventories	June 30, 2019		December 31, 2018
Raw materials	$	150.8	$	157.8
Finished goods	364.8		384.2
Total	$	515.6	$	542.0

XML

LEASES

6 Months Ended

Jun. 30, 2019

Leases [Abstract]

Leases

LEASES

We have operating and finance leases for corporate and market offices, warehouses, automotive and other equipment. Some of our leases may include options to extend or terminate the lease. Certain leases also include options to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.

	Classification	June 30, 2019		January 1, 2019
Assets
Operating right-of-use assets	Right-of-use asset	$	174.9	$	187.5
Finance right-of-use assets	Property, Plant and Equipment	3.0		3.2
Total right-of-use assets		177.9		190.7
Liabilities
Current
Operating lease liabilities	Other accrued liabilities	$	43.8	$	45.4
Finance lease liabilities	Other accrued liabilities	1.2		1.1
Total current lease liabilities		45.0		46.5
Noncurrent
Operating lease liabilities	Long-term operating lease liability	$	144.8	$	155.9
Finance lease liabilities	Long-term debt	1.8		1.9
Total noncurrent lease liabilities		$	146.6	$	157.8
Total lease liability		$	191.6	$	204.3

The table below shows the lease income and expenses recorded in the Consolidated Statement of Operations incurred during the three and six months ended June 30, 2019.

		Three months ended June 30,			Six months ended June 30,
Lease Costs	Classification	2019			2019
Operating lease cost (1)	Selling, general and administrative expenses	$	16.6		$	33.3
Finance lease cost
Amortization of right-of-use assets	Selling, general and administrative expenses	.4			.9
Interest on lease liabilities	Interest Expense	.1			.2
Short-term leases costs	Selling, general and administrative expenses	.8			1.9
Sublease income (2)	Selling, general and administrative expenses	(2.6		)	(5.8		)
Net lease cost		$	15.3		$	30.5

⁽¹⁾ Includes variable lease costs which are immaterial. These are presented in selling, general and administrative expenses in our Consolidated Statements of Operations.

⁽²⁾ Sublease portfolio consists of the sublease of our previous principal executive office located at 777 Third Avenue, New York, NY.

The maturity analysis of the finance and operating lease liabilities is reflected below. This table also reflects the reconciliation of the undiscounted cash flows to the discounted finance and operating lease liabilities as recognized in the June 30, 2019 Consolidated Balance Sheet:

Maturity of Lease Liabilities	Operating Leases		Finance Leases		Total
2019	$	30.7	$	.7	$	31.4
2020	52.8		1.2		54.0
2021	43.5		.8		44.3
2022	36.5		.5		37.0
2023	24.3		.1		24.4
2024	17.1		—		17.1
Thereafter	27.6		—		27.6
Total lease payments	$	232.5	$	3.3	$	235.8
Less: Interest	43.9		.3		44.2
Present value of lease liabilities	$	188.6	$	3.0	$	191.6

At December 31, 2018 our operating and finance lease obligations by due dates were as follows:

Maturity of Lease Liabilities	Operating Leases		Finance Leases		Total
2019	$	56.4	$	1.1	$	57.5
2020	42.0		.6		42.6
2021	35.3		.4		35.7
2022	31.1		.2		31.3
2023	22.4		.1		22.5
Thereafter	46.9		.1		47.0
Total lease payments(1)	$	234.1	$	2.5	$	236.6

⁽¹⁾ Total lease payments of $236.6 represent undiscounted cash flows and therefore do not reconcile to the total discounted lease liability of $204.3 at January 1, 2019 shown above.

The Company has calculated the weighted-average remaining lease term, presented in years below, and the weighted-average discount rate for our operating and finance lease population. As noted in our lease accounting policy (See Note 1, Accounting Policies), the Company uses the incremental borrowing rate as the lease discount rate.

Lease Term and Discount Rate	June 30, 2019
Weighted-average remaining lease term (years)
Operating leases	5.0
Finance leases	2.8
Weighted-average discount rate
Operating leases	8.5	%
Finance leases	11.4	%

The table below sets out the classification of lease payments in the Consolidated Statement of Cash Flows. The right-of-use assets obtained in exchange for new finance and operating lease liabilities represent the new operating and finance leases entered into during the three and six months ended June 30, 2019.

Other Information	Three months ended June 30, 2019			Six months ended June 30, 2019
- Operating Cash Flows From Operating Leases	$	(15.8	)	$	(32.1	)
- Financing Cash Flows From Finance Leases	(.3		)	(.7		)
Cash Paid For Amounts Included In Measurement of Liabilities	$	(16.1	)	$	(32.8	)
Right-of-use Assets Obtained In Exchange For New Finance Liabilities	$	(.1	)	$	(.9	)
Right-of-use Assets Obtained In Exchange For New Operating Liabilities	$	(8.0	)	$	(20.0	)

Leases

LEASES

We have operating and finance leases for corporate and market offices, warehouses, automotive and other equipment. Some of our leases may include options to extend or terminate the lease. Certain leases also include options to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.

	Classification	June 30, 2019		January 1, 2019
Assets
Operating right-of-use assets	Right-of-use asset	$	174.9	$	187.5
Finance right-of-use assets	Property, Plant and Equipment	3.0		3.2
Total right-of-use assets		177.9		190.7
Liabilities
Current
Operating lease liabilities	Other accrued liabilities	$	43.8	$	45.4
Finance lease liabilities	Other accrued liabilities	1.2		1.1
Total current lease liabilities		45.0		46.5
Noncurrent
Operating lease liabilities	Long-term operating lease liability	$	144.8	$	155.9
Finance lease liabilities	Long-term debt	1.8		1.9
Total noncurrent lease liabilities		$	146.6	$	157.8
Total lease liability		$	191.6	$	204.3

The table below shows the lease income and expenses recorded in the Consolidated Statement of Operations incurred during the three and six months ended June 30, 2019.

		Three months ended June 30,			Six months ended June 30,
Lease Costs	Classification	2019			2019
Operating lease cost (1)	Selling, general and administrative expenses	$	16.6		$	33.3
Finance lease cost
Amortization of right-of-use assets	Selling, general and administrative expenses	.4			.9
Interest on lease liabilities	Interest Expense	.1			.2
Short-term leases costs	Selling, general and administrative expenses	.8			1.9
Sublease income (2)	Selling, general and administrative expenses	(2.6		)	(5.8		)
Net lease cost		$	15.3		$	30.5

⁽¹⁾ Includes variable lease costs which are immaterial. These are presented in selling, general and administrative expenses in our Consolidated Statements of Operations.

⁽²⁾ Sublease portfolio consists of the sublease of our previous principal executive office located at 777 Third Avenue, New York, NY.

The maturity analysis of the finance and operating lease liabilities is reflected below. This table also reflects the reconciliation of the undiscounted cash flows to the discounted finance and operating lease liabilities as recognized in the June 30, 2019 Consolidated Balance Sheet:

Maturity of Lease Liabilities	Operating Leases		Finance Leases		Total
2019	$	30.7	$	.7	$	31.4
2020	52.8		1.2		54.0
2021	43.5		.8		44.3
2022	36.5		.5		37.0
2023	24.3		.1		24.4
2024	17.1		—		17.1
Thereafter	27.6		—		27.6
Total lease payments	$	232.5	$	3.3	$	235.8
Less: Interest	43.9		.3		44.2
Present value of lease liabilities	$	188.6	$	3.0	$	191.6

At December 31, 2018 our operating and finance lease obligations by due dates were as follows:

Maturity of Lease Liabilities	Operating Leases		Finance Leases		Total
2019	$	56.4	$	1.1	$	57.5
2020	42.0		.6		42.6
2021	35.3		.4		35.7
2022	31.1		.2		31.3
2023	22.4		.1		22.5
Thereafter	46.9		.1		47.0
Total lease payments(1)	$	234.1	$	2.5	$	236.6

⁽¹⁾ Total lease payments of $236.6 represent undiscounted cash flows and therefore do not reconcile to the total discounted lease liability of $204.3 at January 1, 2019 shown above.

The Company has calculated the weighted-average remaining lease term, presented in years below, and the weighted-average discount rate for our operating and finance lease population. As noted in our lease accounting policy (See Note 1, Accounting Policies), the Company uses the incremental borrowing rate as the lease discount rate.

Lease Term and Discount Rate	June 30, 2019
Weighted-average remaining lease term (years)
Operating leases	5.0
Finance leases	2.8
Weighted-average discount rate
Operating leases	8.5	%
Finance leases	11.4	%

The table below sets out the classification of lease payments in the Consolidated Statement of Cash Flows. The right-of-use assets obtained in exchange for new finance and operating lease liabilities represent the new operating and finance leases entered into during the three and six months ended June 30, 2019.

Other Information	Three months ended June 30, 2019			Six months ended June 30, 2019
- Operating Cash Flows From Operating Leases	$	(15.8	)	$	(32.1	)
- Financing Cash Flows From Finance Leases	(.3		)	(.7		)
Cash Paid For Amounts Included In Measurement of Liabilities	$	(16.1	)	$	(32.8	)
Right-of-use Assets Obtained In Exchange For New Finance Liabilities	$	(.1	)	$	(.9	)
Right-of-use Assets Obtained In Exchange For New Operating Liabilities	$	(8.0	)	$	(20.0	)

XML

EMPLOYEE BENEFIT PLANS

6 Months Ended

Jun. 30, 2019

Retirement Benefits, Description [Abstract]

EMPLOYEE BENEFIT PLANS

EMPLOYEE BENEFIT PLANS

	Three Months Ended June 30,
	Pension Benefits
Net Periodic Benefit Costs	U.S. Plans						Non-U.S. Plans						Postretirement Benefits
	2019			2018			2019			2018			2019		2018
Service cost(1)	$	.5		$	.9		$	1.0		$	1.2		$	—	$	—
Interest cost	.6			.6			3.8			4.0			.3		.3
Expected return on plan assets	(.8		)	(.8		)	(7.7		)	(8.2		)	—		—
Amortization of prior service credit	—			—			—			—			—		(.1		)
Amortization of net actuarial losses	.7			1.3			1.3			1.8			—		—
Net periodic benefit costs(1)	$	1.0		$	2.0		$	(1.6	)	$	(1.2	)	$	.3	$	.2

	Six Months Ended June 30,
	Pension Benefits
Net Periodic Benefit Costs	U.S. Plans						Non-U.S. Plans						Postretirement Benefits
	2019			2018			2019			2018			2019		2018
Service cost	$	1.0		$	1.8		$	2.0		$	2.4		$	—	$	.1
Interest cost	1.2			1.2			7.7			8.2			.6		.6
Expected return on plan assets	(1.6		)	(1.6		)	(15.6		)	(16.6		)	—		—
Amortization of prior service credit	—			—			—			—			—		(.2		)
Amortization of net actuarial losses	1.4			2.6			2.6			3.6			—		—
Settlements/curtailments	—			—			0.1			—			—		—
Net periodic benefit costs(1)	$	2.0		$	4.0		$	(3.2	)	$	(2.4	)	$	.6	$	.5

⁽¹⁾ Service cost is presented in selling, general and administrative expenses in our Consolidated Statements of Operations. The components of net periodic benefit costs other than service cost are presented in other expense, net in our Consolidated Statements of Operations.

During the six months ended June 30, 2019, we made less than $1 of contributions to the U.S. and contributions of $2 to the non-U.S. defined benefit pension and postretirement benefit plans, respectively. During the remainder of 2019, we anticipate contributing approximately $0 to $5 and approximately $0 to $5 to fund our U.S. and non-U.S. defined benefit pension and postretirement benefit plans, respectively.

XML

CONTINGENCIES

6 Months Ended

Jun. 30, 2019

Commitments and Contingencies Disclosure [Abstract]

CONTINGENCIES

CONTINGENCIES

Brazilian Tax Assessments

In December 2012, our Brazilian subsidiary, Avon Industrial LTDA (Avon Brazil Manufacturing) received an excise tax (IPI) assessment for the year 2008. The assessment totals approximately $314, including penalties and accrued interest. As in prior IPI cases that have been resolved in Avon’s favor, this assessment asserts that the establishment in 1995 of separate manufacturing and distribution companies in Brazil was done without a valid business purpose and that Avon Brazil Manufacturing 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 2012 IPI assessment is unfounded.

These matters are being vigorously contested. In July 2013, the 2012 IPI assessment was upheld at the first administrative level and we appealed this decision to the second administrative level. On April 18, 2018, Avon received official notification that the second administrative level has issued a partially favorable and partially unfavorable decision. In this decision, the original assessment was reduced by approximately $66 (including associated penalty and interest), subject to Federal Revenue appeal. The remaining $248 of the assessment was upheld at the second administrative level. On April 20, 2018, we appealed this decision in the third administrative level where the matter remains pending resolution.

On October 3, 2017, Avon Brazil Manufacturing received a new tax assessment notice regarding IPI for 2014 on grounds similar to the 2012 assessment. The 2017 IPI assessment totals approximately $243, including penalties and accrued interest. On April 2, 2018, Avon was notified of an unfavorable decision at the first administrative level. On February 25, 2019, this IPI assessment was upheld at the second administrative level and on April 11, 2019 we appealed this decision to the third administrative level. 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 2017 IPI assessment is unfounded.

In the event that the 2012 and the 2017 IPI assessments are upheld in the third and final administrative level, it may be necessary for us to provide monetary security to pursue further appeals in the judicial levels, which, depending on the circumstances, may result in a charge to earnings and an adverse effect on the Company's Consolidated Statements of Cash Flows. 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). We believe that the 2012 and the 2017 IPI assessments are unfounded, however, based on the likelihood that these will be upheld, we assess the risks as disclosed above as reasonably possible. At June 30, 2019, we have not recognized a liability for the 2012 or 2017 IPI assessments.

Brazil IPI Tax on Cosmetics

Separate from the tax assessments received by Avon Brazil Manufacturing, Avon Cosmeticos LTDA (Avon Brazil) is involved in litigation related to an executive decree issued in May 2015. This decree increased the amount of IPI taxes that are to be remitted by Avon Brazil to the taxing authority on the sales of cosmetic products. 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 was no longer required to remit the taxes associated with IPI into a judicial deposit. On June 12, 2018, we received a decision authorizing Avon to withdraw the amount held as a judicial deposit, substituting it by letter of guarantee, which was presented. On June 29, 2018, the tax authorities presented an appeal against that decision. On July 30, 2018, the funds were received in our bank account. As of September 30, 2018, due in part to recent judicial decisions across the industry and other developments, we concluded, supported by the opinion of legal counsel, that the Executive Decree is unconstitutional. We therefore assessed the IPI tax under ASC 450, Contingencies and determined that the risk of loss is reasonably possible but not probable. Accordingly, we released the associated liability as of September 30, 2018 of approximately $195 and ceased accruing the IPI taxes from October 1, 2018. The liability had been classified within long-term sales taxes and taxes other than income in our Consolidated Balance Sheet, and the release was recorded in product sales and other (income) expense, net in the amounts of approximately $168 and approximately $27, respectively, in our Consolidated Income Statements for the quarter ended September 30, 2018.

An unfavorable ruling to our objection of this IPI tax increase would have an adverse effect on the Company's Consolidated Income Statements and Consolidated Statements of Cash Flows as Avon Brazil would have to remit the reasonably possible amount of $255 to the taxing authorities (including the judicial deposit that was returned to us on July 30, 2018). We are not able to reliably predict the timing of the outcome of our objection to this tax increase.

A favorable judicial ruling to our objection of this IPI tax would also have an adverse effect on the Company's Consolidated Statements of Cash Flows as Avon Brazil would have to remit all or a portion of the associated income tax liability to the taxing authorities. The Company is accruing a tax reserve, which amounts to approximately $80 at June 30, 2019. This reserve would be settled on final adjudication of the law through a combination of cash and use of deferred tax assets.

Talc-Related Litigation

The Company has been named a defendant in numerous personal injury lawsuits filed in U.S. courts, alleging that certain talc products the Company sold in the past were contaminated with asbestos. Many of these actions involve a number of co-defendants from a variety of different industries, including manufacturers of cosmetics and manufacturers of other products that, unlike the Company’s products, were designed to contain asbestos. As of June 30, 2019, there were 118 individual cases pending against the Company. During the three months ended June 30, 2019, nine new cases were filed and nine cases were dismissed, settled, or otherwise resolved. The value of our settlements in this area thus far has not been material, either individually or in the aggregate. Additional similar cases arising out of the use of the Company's talc products are reasonably anticipated.

We believe that the claims asserted against us in these cases are without merit. We are defending vigorously against these claims and will continue to do so. To date, the Company has not proceeded to trial in any case filed against it and there have been no findings of liability enforceable against the Company. However, nationwide trial results in similar cases filed against other manufacturers of cosmetic talc products have ranged from outright dismissals to very large jury awards of both compensatory and punitive damages. Given the inherent uncertainties of litigation, we cannot predict any overall trends in the outcome of the cases pending against the Company, and we are only able to make a reasonable estimate for a small number of individual cases that have advanced to the later stages of legal proceedings.  Any accruals currently recorded on the Company’s balance sheet with respect to these individual cases are not material.  Other than these accruals, we are at this time unable to estimate our reasonably possible or probable losses.  However, any adverse outcomes, either in an individual case or in the aggregate, could be material. Future costs to litigate these cases, which we expense as incurred, are not known but may be significant, though some costs will be covered by insurance.

Brazilian Labor-Related Litigation

On an ongoing basis, the Company is subject to numerous and diverse labor-related lawsuits filed by employees in Brazil. These cases are assessed on an aggregated and ongoing basis based on historical outcomes of similar cases. The claims made are often for significantly larger sums than have historically been paid out by the Company. Our practice continues to be to recognize a liability based on our assessment of historical payments in similar cases. Our best estimate of the probable loss for such current cases at June 30, 2019 is approximately $12 and, accordingly, we have recognized a liability for this amount.

Shareholder Litigation

On February 14, 2019, a purported shareholder’s class action complaint (Bevinal v. Avon Products, Inc., et al., No. 19-cv-1420) was filed in the United States District Court for the Southern District of New York against the Company and certain former officers of the Company.  On June 3, 2019, the court appointed a lead plaintiff and class counsel. The complaint was subsequently amended on June 28, 2019 and recaptioned “In re Avon Products, Inc. Securities Litigation” on July 8, 2019. The amended complaint is brought on behalf of a purported class consisting of all purchasers or acquirers of Avon common stock between January 21, 2016 and November 1, 2017, inclusive.  The complaint asserts violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the "Exchange Act") based on allegedly false or misleading statements and alleged market manipulation with respect to, among other things, changes made to Avon’s credit terms for Representatives in Brazil.  On July 26, 2019 we filed a motion to dismiss. In light of the early stage of the litigation, we are unable to predict the outcome of this matter and are unable to assess the likelihood of loss or to make a reasonable estimate of the amount or range of loss that could result from an unfavorable outcome.

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 June 30, 2019, is not expected to have a material adverse effect on our consolidated financial position, results of operations or cash flows.

XML

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

6 Months Ended

Jun. 30, 2019

Equity [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 June 30, 2019 and 2018:

Three Months Ended June 30, 2019	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Investment in New Avon		Total
Balance at March 31, 2019	$	(939.6	)	$	(1.4	)	$	(4.3	)	$	(92.5	)	$	3.4	$	(1,034.4	)
Other comprehensive loss other than reclassifications	4.4			(1.0		)	—			—			—		3.4
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0	—			.3			—			—			—		.3
Amortization of net actuarial loss and prior service cost, net of tax of $.2(1)	—			—			—			1.8			—		1.8
Total reclassifications into earnings	—			.3			—			1.8			—		2.1
Balance at June 30, 2019	$	(935.2	)	$	(2.1	)	$	(4.3	)	$	(90.7	)	$	3.4	$	(1,028.9	)

Three Months Ended June 30, 2018	Foreign Currency Translation Adjustments			Net Investment Hedges			Pension and Postretirement Benefits			Investment in New Avon		Total
Balance at March 31, 2018	$	(797.3	)	$	(4.3	)	$	(92.8	)	$	3.4	$	(891.0	)
Other comprehensive income other than reclassifications	(126.2		)	—			—			—		(126.2		)
Reclassifications into earnings:
Amortization of net actuarial loss and prior service cost, net of tax of $.1(1)	—			—			2.8			—		2.8
Total reclassifications into earnings	—			—			2.8			—		2.8
Balance at June 30, 2018	$	(923.5	)	$	(4.3	)	$	(90.0	)	$	3.4	$	(1,014.4	)

Six Months Ended June 30, 2019	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Investment in New Avon		Total
Balance at December 31, 2018	$	(936.2	)	$	.5		$	(4.3	)	$	(93.8	)	$	3.4	$	(1,030.4	)
Other comprehensive loss other than reclassifications	1.0			(3.4		)	—			—			—		(2.4		)
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0	—			.8			—			—			—		.8
Amortization of net actuarial loss and prior service cost, net of tax of $.3(1)	—			—			—			3.1			—		3.1
Total reclassifications into earnings	—			.8			—			3.1			—		3.9
Balance at June 30, 2019	$	(935.2	)	$	(2.1	)	$	(4.3	)	$	(90.7	)	$	3.4	$	(1,028.9	)

Six Months Ended June 30, 2018:	Foreign Currency Translation Adjustments			Net Investment Hedges			Pension and Postretirement Benefits			Investment in New Avon		Total
Balance at December 31, 2017	$	(829.6	)	$	(4.3	)	$	(95.7	)	$	3.4	$	(926.2	)
Other comprehensive income other than reclassifications	(93.9		)	—			—			—		(93.9		)
Reclassifications into earnings:
Amortization of net actuarial loss and prior service cost, net of tax of $0.3(1)	—			—			5.7			—		5.7
Total reclassifications into earnings	—			—			5.7			—		5.7
Balance at June 30, 2018	$	(923.5	)	$	(4.3	)	$	(90.0	)	$	3.4	$	(1,014.4	)

(1) Gross amount reclassified to other expense, net in our Consolidated Statements of Operations, and related taxes reclassified to income taxes in our Consolidated Statements of Operations.

Foreign exchange net losses of $2.3 and $9.6 for the three months ended June 30, 2019 and 2018, respectively, and foreign exchange net losses of $.7 and $3.7 for the six months ended June 30, 2019 and 2018, respectively, resulting from the translation of actuarial losses and prior service cost recorded in AOCI, are included in foreign currency translation adjustments in our Consolidated Statements of Comprehensive Loss.

XML

SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2019

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

We determine segment profit by deducting the related costs and expenses from segment revenue. Segment profit includes an allocation of global marketing and digital expenses based on actual revenues. Segment profit excludes global expenses other than the allocation of marketing and digital, costs to implement ("CTI") restructuring initiatives (see Note 15, Restructuring Initiatives), certain significant asset impairment charges, and other expenses, 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 June 30,				Six Months Ended June 30,
Total Revenue	2019		2018		2019		2018
Europe, Middle East & Africa	$	425.1	$	500.7	$	883.8	$	1,069.1
South Latin America	443.0		516.1		857.7		1,013.2
North Latin America	193.8		207.3		386.5		402.9
Asia Pacific	108.4		113.1		223.7		224.5
Total revenue from reportable segments	1,170.3		1,337.2		2,351.7		2,709.7
Other operating segments and business activities(1)	4.5		14.7		10.0		35.7
Total revenue	$	1,174.8	$	1,351.9	$	2,361.7	$	2,745.4

	Three Months Ended June 30,						Six Months Ended June 30,
Operating Profit	2019			2018			2019			2018
Segment Profit
Europe, Middle East & Africa	$	59.0		$	74.4		$	118.2		$	148.8
South Latin America	65.2			55.2			89.0			82.4
North Latin America	19.1			19.0			35.6			39.8
Asia Pacific	10.8			7.3			27.5			17.7
Total profit from reportable segments	$	154.1		$	155.9		$	270.3		$	288.7
Other operating segments and business activities(1)	.5			(.6		)	1.1			1.6
Unallocated global expenses	(65.3		)	(78.6		)	(128.4		)	(157.8		)
CTI restructuring initiatives	(45.7		)	(23.7		)	(99.2		)	(34.6		)
Other expenses(2)	(13.1		)	—			(17.2		)	—
Operating profit	$	30.5		$	53.0		$	26.6		$	97.9

(1) Other operating segments and business activities include markets that have been exited. Effective in the first quarter of 2018, given that we exited Australia and New Zealand during 2018, the results of Australia and New Zealand are now reported in Other operating segments and business activities for all periods presented, while previously the results had been reported in the Asia Pacific segment. 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.

(2) Other expenses includes primarily professional fees incurred in relation to the Natura transaction, and other impairment losses on assets.

XML

SUPPLEMENTAL BALANCE SHEET INFORMATION

6 Months Ended

Jun. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

SUPPLEMENTAL BALANCE SHEET INFORMATION

SUPPLEMENTAL BALANCE SHEET INFORMATION

At June 30, 2019 and December 31, 2018, prepaid expenses and other included the following:

Components of Prepaid Expenses and Other	June 30, 2019		December 31, 2018
Prepaid taxes and tax refunds receivable	$	155.0	$	145.0
Receivables other than trade	53.2		69.2
Prepaid brochure costs, paper and other literature	13.6		14.9
Other	42.4		42.9
Prepaid expenses and other	$	264.2	$	272.0

At June 30, 2019 and December 31, 2018, other assets included the following:

Components of Other Assets(1)	June 30, 2019		December 31, 2018
Net overfunded pension plans	$	95.5	$	88.1
Capitalized software	85.0		89.3
Judicial deposits	74.8		74.1
Long-term receivables	90.6		73.2
Trust assets associated with supplemental benefit plans	37.9		37.0
Tooling (plates and molds associated with our beauty products)	12.5		12.6
Other	38.0		16.1
Other assets	$	434.3	$	390.4

(1) Deferred tax asset balance as of June 30, 2019 and December 31, 2018 is presented separately in the Consolidated Balance sheet.

XML

RESTRUCTURING INITIATIVES

6 Months Ended

Jun. 30, 2019

Restructuring and Related Activities [Abstract]

RESTRUCTURING INITIATIVES

RESTRUCTURING INITIATIVES

Transformation Plan and Open Up Avon

Open Up Avon

In September 2018, we initiated a new strategy in order to return Avon to growth ("Open Up Avon"). The Open Up Avon strategy is integral to our ability to return Avon to growth, built around the necessity of incorporating new approaches to various elements of our business, including increased utilization of third-party providers in manufacturing and technology, a more fit for purpose asset base, and a focus on enabling our Representatives to more easily interact with the company and achieve relevant earnings. The commercial elements of the strategy were developed to help increase Representative earnings and thereby retention. Elements of the Representative strategy include improvements in service functions, increased training on utilization of digital tools to expand her consumer reach, product bundling and regimens designed to help improve her earnings opportunity and sharper more targeted product innovation to drive brand relevancy. Cost savings under this plan are targeted as annualized cost savings of approximately $400 by 2021, and expected to be generated from efficiencies in manufacturing and sourcing, distribution, general and administrative activities, and back office functions, as well as through revenue management, interest and tax. These savings are expected to be achieved through restructuring actions (that may result in charges related to severance, contract terminations and inventory and other asset write-offs), as well as other cost-savings strategies that would not result in restructuring charges. In January 2019, we announced significant advancements in this strategy, including a structural reset of inventory processes and a reduction in global workforce. The structural reset of inventory will result in lower operational and ongoing obsolescence costs. Over the longer term, it will result in a more concentrated focus on high-turn, higher margin products, driving greater earnings for Representatives due to lessened discount pressure and enhanced service levels. The structural reset resulted in an incremental one-off inventory obsolescence expense of $88 recognized at December 31, 2018. In addition, the global workforce will be reduced in 2019 by approximately 10% to align with ongoing operating model changes and to create a leaner organization that is better aligned with Avon’s current and future business focus. This reduction is incremental to an 8% reduction of the global workforce that was completed in 2018. We expect to incur a restructuring charge of approximately $100 in 2019 relating to the global workforce reduction, which was approved by the Board of Directors in January 2019. We initiated the Open Up Avon strategy to enable us to achieve our goals of low-single-digit Constant $ revenue growth and low double-digit operating margin by 2021. We plan to reinvest a portion of these cost savings in commercial initiatives, including training for Representatives, and digital and information technology infrastructure initiatives. As a result of Open Up Avon restructuring actions approved to-date, we have recorded total costs to implement these restructuring initiatives of $216.6 before taxes, of which $28.3 and $73.4 was recorded during the three and six months ended June 30, 2019, respectively, in our Consolidated Statements of Operations.

Transformation Plan

In January 2016, we initiated a transformation plan (the "Transformation Plan"), in order to enable us to achieve our long-term goals of mid-single-digit constant-dollar ("Constant $") revenue growth and low double-digit operating margin. Under this plan, we had targeted pre-tax annualized cost savings of approximately $350 after three years, which we exceeded through restructuring actions, as well as other cost-savings strategies that did not result in restructuring charges.

As a result of these restructuring actions approved to-date, we have recorded total costs to implement these restructuring initiatives of $207.7 before taxes, of which $4.2 and $2.2 was recorded during the three and six months ended June 30, 2019, respectively, in our Consolidated Statements of Operations. There are no further restructuring actions to be taken associated with our Transformation Plan, as beginning in the third quarter of 2018, all new restructuring actions approved operate under our new Open Up Avon plan described above.

Costs to Implement Restructuring Initiatives - Three and Six Months Ended June 30, 2019 and 2018

During the three months ended June 30, 2019, we recorded net costs to implement of $32.5, of which $28.3 related to Open Up Avon and $4.2 related to the Transformation Plan in our Consolidated Statements of Operations. During the three months ended June 30, 2018, we recorded costs to implement of $24.5 related to the Transformation Plan and $.8 benefit related to other restructuring initiatives in our Consolidated Statements of Operations.

During the six months ended June 30, 2019, we recorded net costs to implement of $75.7, of which $73.4 related to Open Up Avon, $2.2 related to the Transformation Plan, and $.1 related to other restructuring initiatives, in our Consolidated Statements of Operations. During the six months ended June 30, 2018, we recorded costs to implement of $35.3 related to the Transformation Plan and $.7 benefit related to other restructuring initiatives in our Consolidated Statements of Operations.

The costs during the three and six months ended June 30, 2019 and 2018 consisted of the following:

	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
CTI recorded in operating profit - COGS
Manufacturing asset write-offs	$	6.0		$	—		$	9.8		$	—
Inventory write-off	2.6			.4			3.1			1.1
	8.6			.4			12.9			1.1
CTI recorded in operating profit - SG&A
Net charges for employee-related costs, including severance benefits	13.4			16.5			48.6			24.8
Implementation costs, primarily related to professional service fees	17.3			4.7			26.0			5.7
Dual running costs	2.6			—			4.5			—
Contract termination and other net benefits	1.4			1.2			4.6			1.4
Impairment of other assets	2.3			—			2.3			—
Accelerated depreciation	.1			.9			.3			1.6
	37.1			23.3			86.3			33.5
CTI recorded in operating profit	45.7			23.7			99.2			34.6
CTI recorded in other expenses
Gain on sale of Rye Office	(9.9		)	—			(9.9		)	—
Gain on sale of Malaysia Maximin	(3.3		)	—			(3.3		)	—
Gain on sale of China business (relating mainly to foreign currency translation adjustment gain)	—			—			(10.3		)	—
Total CTI	$	32.5		$	23.7		$	75.7		$	34.6
Open Up Avon	$	28.3		$	—		$	73.4		$	—
Transformation Plan	$	4.2		$	24.5		$	2.2		$	35.3
Other	$	—		$	(.8	)	$	.1		$	(.7	)

The tables below include restructuring costs such as employee-related costs, inventory and asset write-offs, foreign currency translation write-offs and contract terminations, and do not include other costs to implement restructuring initiatives such as professional services fees, dual running costs, accelerated depreciation and gain on sale of business.

The liability balance included in other accrued liabilities in our Consolidated Statements of Operations for the restructuring actions associated with Open Up Avon at June 30, 2019 is as follows:

	Employee-Related Costs			Inventory/Assets Write-offs			Foreign Currency Translation Adjustment Write-offs			Contract Terminations/Other			Total
Balance at December 31, 2018	$	19.6		$	—		$	—		$	1.1		$	20.7
2019 charges	$	52.9		$	15.2		$	(10.9	)	$	4.5		61.7
Adjustments	(3.1		)	—			—			(.1		)	(3.2		)
Cash payments	(35.4		)	—			—			(1.8		)	(37.2		)
Non-cash write-offs	—			(15.2		)	10.9			—			(4.3		)
Foreign exchange	(.8		)	—			—			—			(.8		)
Balance at June 30, 2019	$	33.2		$	—		$	—		$	3.7		$	36.9

The liability balance included in other accrued liabilities in our Consolidated Balance Sheet for the restructuring actions associated with our Transformation Plan as of June 30, 2019 is as follows:

	Employee-Related Costs			Contract Terminations/Other			Total
Balance at December 31, 2018	$	34.4		$	3.6		$	38.0
2019 charges	(1.1		)	.2			(.9		)
Cash payments	(19.9		)	(2.7		)	(22.6		)
Foreign exchange	.1			—			.1
Balance at June 30, 2019	$	13.5		$	1.1		$	14.6

The majority of cash payments, if applicable, associated with the year-end liability are expected to be made during 2019.

The following table presents the restructuring charges incurred to date, under Open Up Avon and the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plans:

	Employee- Related Costs		Inventory/ Asset Write-offs		Contract Terminations/Other		Foreign Currency Translation Adjustment Write-offs			Total
Open Up Avon
Charges incurred to-date	$	76.1	$	105.1	$	5.2	$	(10.9	)	$	175.5
Estimated charges to be incurred on approved initiatives	—		—		.1		—			.1
Total expected charges on approved initiatives	$	76.1	$	105.1	$	5.3	$	(10.9	)	$	175.6
Transformation Plan
Charges incurred to-date	$	126.9	$	2.3	$	40.9	$	3.4		$	173.5
Estimated charges to be incurred on approved initiatives	—		—		—		—			—
Total expected charges on approved initiatives	$	126.9	$	2.3	$	40.9	$	3.4		$	173.5

The charges, net of adjustments, of initiatives under the Open Up Avon and the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plans, by reportable segment are as follows:

	Europe, Middle East & Africa			South Latin America		North Latin America			Asia Pacific			Global & Other Operating Segments		Total
Open Up Avon
2018	$	32.2		$	36.4	$	27.9		$	14.4		$	6.2	$	117.1
First quarter 2019	13.5			12.7		2.9			(3.2		)	7.3		33.2
Second quarter 2019	4.5			13.7		4.3			(1.2		)	3.9		25.2
Charges incurred to-date	50.2			62.8		35.1			10.0			17.4		175.5
Estimated charges to be incurred on approved initiatives	.1			—		—			—			—		.1
Total expected charges on approved initiatives	$	50.3		$	62.8	$	35.1		$	10.0		$	17.4	$	175.6
Transformation Plan
2015	$	—		$	—	$	—		$	—		$	21.4	$	21.4
2016	30.9			13.2		4.4			9.1			16.8		74.4
2017	.9			5.6		(.6		)	(.5		)	49.4		54.8
2018	5.0			4.1		.6			.6			13.4		23.7
First quarter 2019	(1.1		)	—		—			—			.3		(.8		)
Second quarter 2019	—			—		—			—			—		—
Charges incurred to-date	35.7			22.9		4.4			9.2			101.3		173.5
Estimated charges to be incurred on approved initiatives	—			—		—			—			—		—
Total expected charges on approved initiatives	$	35.7		$	22.9	$	4.4		$	9.2		$	101.3	$	173.5

The charges above are not included in segment profit, as this excludes costs to implement restructuring initiatives. The amounts shown in the tables above as charges recorded to-date relate to initiatives that have been approved and recorded in the consolidated 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.

XML

GOODWILL

6 Months Ended

Jun. 30, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL

GOODWILL

	Europe, Middle East & Africa			South Latin America		Asia Pacific		Total
Net balance at December 31, 2018	$	18.0		$	66.8	$	2.6	$	87.4
Changes during the period ended June 30, 2019:
Foreign exchange	(.3		)	2.8		—		2.5
Net balance at June 30, 2019	$	17.7		$	69.6	$	2.6	$	89.9

XML

FAIR VALUE

6 Months Ended

Jun. 30, 2019

Fair Value Disclosures [Abstract]

FAIR VALUE

FAIR VALUE

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 June 30, 2019:

	Level 1		Level 2		Total
Assets:
Available-for-sale securities	$	3.8	$	—	$	3.8
Foreign exchange forward contracts	$	—	$	1.2	$	1.2
Total	$	3.8	$	1.2	$	5.0
Liabilities:
Foreign exchange forward contracts	$	—	$	10.9	$	10.9
Total	$	—	$	10.9	$	10.9

The assets and liabilities measured at fair value on a recurring basis were immaterial at December 31, 2018.

Fair Value of Financial Instruments

Our financial instruments include cash and cash equivalents, available-for-sale securities, short-term investments, accounts 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 June 30, 2019 and December 31, 2018, respectively, consisted of the following:

	June 30, 2019						December 31, 2018
	Carrying Amount			Fair Value			Carrying Amount			Fair Value
Available-for-sale securities	$	3.8		$	3.8		$	3.8		$	3.8
Debt maturing within one year(1)	(398.5		)	(408.1		)	(12.0		)	(12.0		)
Long-term debt(1)	(1,197.0		)	(1,254.0		)	(1,581.6		)	(1,460.2		)
Foreign exchange forward contracts	(9.7		)	(9.7		)	(5.1		)	(5.1		)

(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.

XML

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

6 Months Ended

Jun. 30, 2019

Derivative Instruments and Hedging Activities Disclosure [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 at June 30, 2019:

	Asset			Liability
	Balance Sheet Classification	Fair Value		Balance Sheet Classification	Fair Value
Derivatives designated as hedges:
Foreign exchange forward contracts	Prepaid expenses and other	$	—	Accounts payable	$	2.0
Derivatives not designated as hedges:
Foreign exchange forward contracts	Prepaid expenses and other	$	1.2	Accounts payable	$	8.9
Total derivatives		$	1.2		$	10.9

The fair value of derivative instruments outstanding was immaterial at December 31, 2018.

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 June 30, 2019, we do not have any interest-rate swap agreements. Approximately 25% and 1% of our debt portfolio, at June 30, 2019 and December 31, 2018, respectively, was exposed to floating interest rates. For the purpose of this calculation, we consider all short-term debt to be exposed to floating interest rates.

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 was amortized as a reduction of interest expense until repayment of the underlying debt obligations in June 2018, at which point the remaining unamortized balance was fully released to the Consolidated Statement of Operations. The net impact of the gain amortization was zero for both the three and six months ended June 30, 2019, and $1.3 and $6.0 for the three and six months ended June 30, 2018, respectively. At June 30, 2019, there was no unamortized deferred gain associated with the March 2012 interest-rate swap termination as the underlying debt obligations have been paid.

Foreign Currency Risk

We may use foreign exchange forward contracts to manage a portion of our foreign currency exchange rate exposures. At June 30, 2019, we had outstanding foreign exchange forward contracts with notional amounts totaling approximately $1,192.5 for various currencies, of which $19.5 were designated as cash flow hedges.

We may use foreign exchange forward contracts to manage foreign currency exposure of certain intercompany loans. 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 and six months ended June 30, 2019, we recorded a loss of $3.1 and a gain of $21.9, respectively, in other expense in our Consolidated Statements of Operations related to these undesignated foreign exchange forward contracts. During the three and six months ended June 30, 2018, we recorded gains of $1.7 and $2.2, respectively, in other expense, net in our Consolidated Statements of Operations related to other undesignated foreign exchange forward contracts.

During the first quarter of 2019, we discontinued our program to hedge foreign exchange risk relating to forecasted operational transactions. The last of our designated cash flow hedges will expire during the first quarter of 2020. Our designated hedges did not have a material impact on our Consolidated Financial Statements for the six months ended June 30, 2019.

XML

DEBT

6 Months Ended

Jun. 30, 2019

Debt Disclosure [Abstract]

DEBT

DEBT

Revolving Credit Facility

In June 2015, 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").

In February 2019, Avon International Capital, p.l.c. ("AIC"), a wholly-owned foreign subsidiary of the Company, entered into a

three-year €200.0 million senior secured revolving credit facility (the "2019 facility"). As of June 30, 2019 this amounted to $227.0. The 2019 facility replaced the 2015 facility and the 2015 facility was terminated at such time. There were no amounts drawn under

the 2015 revolving credit facility on the date of termination and no early termination penalties were incurred. In the first quarter of 2019, $2.0 was recorded for the write-off of unamortized issuance costs related to the 2015 revolving credit facility. As of June 30, 2019, there were no amounts outstanding under the 2019 facility. The 2019 facility will terminate in February 2022; provided, however, that it shall terminate on the 91^st day prior to the maturity of 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. In the first quarter of 2019, the Company capitalized $10.0 of issue costs relating to the new revolving credit facility; this resulted in a cash outflow presented in other financing activities within the Consolidated Statement of Cash Flows.

As of June 30, 2019, we were in compliance with our interest coverage and total leverage ratios under the 2019 facility. The amount of the facility available to be drawn down on is reduced by any standby letters of credit granted by an obligor, which, as of June 30, 2019, was approximately $25.0. As of June 30, 2019, based on then applicable exchange rates, the entire amount of the remaining 2019 facility, which is approximately €178.0 million, could have been drawn down without violating any covenant.

Public Notes

In March 2013, we issued, in a public offering, $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"). Interest on the 2013 Notes is payable semi-annually on March 15 and September 15 of each year.

The indenture governing the 2013 Notes contains interest rate adjustment provisions depending on the long-term credit ratings assigned to the 2013 Notes by 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 2.00% 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.

As of June 30, the remaining aggregate principal amount of the 4.60% Notes was $386.9.  In July 2019, the Company issued $400.0 Senior Secured Notes (the 2019 Notes), the proceeds of which were partially used to purchase an aggregate principal amount of $275.0 of the 4.60% Notes. Refer to Note 22, Subsequent Events for further information regarding this issuance. In the second quarter of 2019, the Company capitalized $8 of issue costs relating to the 2019 Notes, with no cash impact in the six month period ended June 30, 2019.

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 "2016 Notes"). Interest on the Senior Secured Notes is payable semi-annually on February 15 and August 15 of each year.

XML

INCOME TAXES

6 Months Ended

Jun. 30, 2019

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

Our quarterly income tax provision is calculated using an estimated annual effective income tax approach. The quarterly effective tax rate can differ from our estimated annual effective tax rate as the Company cannot apply an effective tax rate approach for all of its operations. For those entities that can apply an effective tax rate approach, as of June 30, 2019, our annual effective tax rate, excluding discrete items, is 26.0% for 2019, as compared to 25.6% as of June 30, 2018. The remaining entities, which are operations that generate pre-tax losses which cannot be tax benefited and/or have an effective tax rate which cannot be reliably estimated, have to account for their income taxes on a discrete year-to-date basis as of the end of each quarter and are excluded from the effective tax rate approach.

The estimated annual effective tax rate for 2019 also excludes the unfavorable impact of withholding taxes associated with certain intercompany payments, including royalties, service charges, interest and dividends, which in the aggregate are relatively consistent each year due to the need to repatriate funds to cover U.S. and U.K.-based costs, such as interest on debt and corporate overhead. Withholding taxes associated with the relatively consistent intercompany payments are accounted for discretely and accrued in the provision for income taxes as they become due.

The provision for income taxes for the three months ended June 30, 2019 and 2018 was $27.2 and $36.7, respectively. Our effective tax rates for the three months ended June 30, 2019 and 2018 were 127.7% and (12,233.3)%, respectively. The provision for income taxes for the six months ended June 30, 2019 and 2018 was $46.7 and $68.2, respectively. Our effective tax rates for the six months ended June 30, 2019 and 2018 were 278.0% and 675.2%.

The effective tax rates for the three months ended June 30, 2019 and 2018 were impacted by CTI restructuring charges which could not all be benefitted, country mix of earnings and withholding taxes. The effective tax rate for the three months ended June 30, 2019 was also negatively impacted by the accrual of miscellaneous income tax expenses of approximately $0.6. The effective tax rate for the three months ended June 30, 2018 was also negatively impacted by one-time tax reserves of $5.5 associated with our uncertain tax positions.

The effective tax rates for the six months ended June 30, 2019 and 2018 were impacted by CTI restructuring charges which could not all be benefitted, country mix of earnings and withholding taxes. The effective tax rate for the six months ended June 30, 2019 was also favorably impacted by the accrual of net income tax benefits of approximately $2.9 associated with the release of income tax reserves of approximately $3.3 associated with our uncertain tax positions net of other miscellaneous income tax expenses of approximately $0.4. The effective tax rate for the six months ended June 30, 2018 was also negatively impacted by one-time tax reserves of $14.7 associated with our uncertain tax positions.

In its final analysis of the impacts of the Tax Cuts and Job Act (the "Act") during the fourth quarter of 2018, the Company elected to treat income taxes associated with Global Intangible Low-Taxed Income ("GILTI"), as a period cost. As a result, the 2019 provision for income taxes reflects this treatment. The 2018 provision for income taxes was also calculated treating GILTI as a period cost. For both periods, GILTI did not have a material effect. The Act has significant complexity. The Company has considered the published guidance provided by the various Federal and state regulatory authorities into the calculation of its income tax provisions available as of June 30, 2019 and June 30, 2018 for the respective periods ended June 30, 2019 and June 30, 2018.

In prior years, we had previously recorded valuation allowances against certain deferred tax assets associated with the U.S. and various foreign jurisdictions. We intend to continue maintaining these valuation allowances on our deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances. Release of the valuation allowance would result in the recognition of certain deferred tax assets and a decrease to income tax expense for the period the release is recorded. However, the exact timing and amount of the valuation allowance release are subject to change on the basis of the level of profitability that we are able to actually achieve.

XML

AGREEMENT AND PLAN OF MERGERS WITH NATURA COSMETICOS S.A.

6 Months Ended

Jun. 30, 2019

Business Combinations [Abstract]

AGREEMENT AND PLAN OF MERGERS WITH NATURA COSMETICOS S.A.

AGREEMENT AND PLAN OF MERGERS WITH NATURA COSMETICOS S.A.

On May 22, 2019, the Company entered into an Agreement and Plan of Mergers (the "Merger Agreement") with Natura Cosméticos S.A., a Brazilian corporation (sociedade anônima) ("Natura Cosméticos"), Natura &Co Holding S.A., a Brazilian corporation (sociedade anônima) ("Natura &Co Holding"), Nectarine Merger Sub I, Inc., a Delaware corporation and a direct wholly owned subsidiary of Natura &Co Holding ("Merger Sub I"), and Nectarine Merger Sub II, Inc., a Delaware corporation and a direct wholly owned subsidiary of Merger Sub I ("Merger Sub II"), pursuant to which (i) Natura &Co Holding will, after the completion of certain restructuring steps, hold all issued and outstanding shares of Natura Cosméticos, (ii) Merger Sub II will merge with and into Avon, with Avon surviving the merger and (iii) Merger Sub I will merge with and into Natura &Co Holding, with Natura &Co Holding surviving the merger and as a result of which Avon will become a wholly owned direct subsidiary of Natura &Co Holding (collectively, the "Transaction"). If the Transaction is completed, Avon and Natura Cosméticos will each become wholly owned subsidiaries of Natura &Co Holding.

If the Transaction is completed, each share of Avon common stock issued and outstanding immediately prior to the consummation of the Transaction will be converted into the right to receive, at the election of the holder thereof, (i) 0.300 validly issued and allotted, fully paid-up American Depositary Shares of Natura &Co Holding, each representing one Natura &Co Holding Share ("Natura &Co Holding ADSs") against the deposit of the requisite number of shares of common stock of Natura &Co Holding ("Natura &Co Holding Shares"), subject to adjustment in accordance with the terms of the Merger Agreement, and any cash in lieu of fractional Natura &Co Holding ADSs or (ii) 0.300 validly issued and allotted, fully paid-up Natura &Co Holding Shares, subject to adjustment in accordance with the terms of the Merger Agreement, and any cash in lieu of fractional Natura &Co Holding Shares, and each share of Avon series C preferred stock held by Cerberus Investor issued and outstanding immediately prior to the consummation of the Transaction will be automatically converted into the right to receive an amount in cash without interest equal to the Stated Value (as defined in Avon's certificate of incorporation) of such shares of series C preferred stock. Upon the consummation of the Transaction, Natura &Co Holding Shares are expected to be listed on the B3 S.A. - Brasil, Bolsa, Balcão stock exchange (the "B3") and Natura &Co Holding ADSs are expected to be listed on the New York Stock Exchange (the "NYSE"). Additionally, upon the consummation of the Transaction, Avon common stock will cease to be traded on the NYSE.

The Merger Agreement contains customary representations and warranties of Avon, Natura Cosméticos and Natura &Co Holding relating to their respective businesses and public filings, in each case generally subject to a materiality qualifier. Additionally, the Merger Agreement provides for customary pre-closing covenants of Avon, including (i) covenants relating to conducting its business in the ordinary course consistent with past practice and to refrain from taking certain actions without Natura Cosméticos's consent, (ii) covenants not to solicit proposals relating to alternative transactions or, subject to certain exceptions, enter into discussions concerning, or provide information in connection with, alternative transactions and (iii) covenants to recommend, subject to certain exceptions, that Avon's shareholders adopt the Merger Agreement.

The timing and completion of the Transaction is subject to a number of closing conditions, including (i) Avon and Natura Cosméticos shareholder approvals having been obtained in accordance with applicable law, (ii) clearance from competition authorities in certain jurisdictions where Avon and Natura Cosméticos operate, (iii) the absence of any judgment, injunction or other order issued by a court of competent jurisdiction prohibiting the Transaction, (iv) effectiveness of registration statements for Natura &Co Holding's ADSs, (v) listing approval for Natura &Co Holding's ADSs on the NYSE, (vi) listing approval for Natura &Co Holding's shares on the B3 stock exchange under the Novo Mercado listing segment and (vii) subject to certain materiality exceptions, the accuracy of Avon's, Natura Cosméticos's and Natura &Co Holding's representations and warranties in the Merger Agreement and performance by each party of their obligations under the Merger Agreement.

The Company has incurred costs to date of $17 in relation to the Transaction, primarily professional fees and impairment loss on assets, and these have been disclosed as a non-GAAP adjustment to operating profit, selling, general and administrative expenses as a % of total revenue, operating margin and income (loss) before taxes. It is expected that additional costs will be incurred prior to or at the closing of the Transaction, including approximately $33 with respect to professional fees that are contingent on the successful closing of the Transaction.

XML

SUBSEQUENT EVENTS

6 Months Ended

Jun. 30, 2019

Subsequent Events [Abstract]

Subsequent Events

SUBSEQUENT EVENTS

Bond issue

In July 2019, the Company issued $400 in aggregate principal amount of 6.50% Senior Notes which will mature on August 15, 2022. The proceeds were partially used to purchase an aggregate principal amount of $275 of the Company's 4.6% Notes, due during 2020, under a cash tender offer completed during July 2019.

Indirect tax Court Decisions in Brazil

In July 2019, the Brazilian judicial court held decisions in favor of Avon relating to historic indirect tax items. The Company has not received the formal decision in writing as of the date of this filing. At June 30, 2019, no receivable was recognized in relation to these cases. The gross amount of the credits involved is $117.

XML

ACCOUNTING POLICIES (Policy)

6 Months Ended

Jun. 30, 2019

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 2018 Annual Report on Form 10-K ("2018 Form 10-K") in preparing these unaudited interim Consolidated Financial Statements, other than those impacted by new accounting standards as described below. 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 2018 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 generally provide for accruals under our various employee benefit plans for each quarter based on one quarter of the estimated annual expense, and adjust these accruals as estimates are refined. 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 for which an effective tax rate cannot be reliably estimated.

Leases

Leases

In February 2016, the FASB issued ASU 2016-02, Leases, which requires all assets and liabilities arising from leases to be recognized in our Consolidated Balance Sheets. We adopted this new accounting guidance effective January 1, 2019.

In July 2018, the FASB added an optional transition method which we elected upon adoption of the new standard. This allowed us to recognize and measure leases existing at January 1, 2019 without restating comparative information. In addition, we elected to apply the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allows us to carry forward the historical lease classification.

We determine if an arrangement is a lease at the lease commencement date. In addition to our lease agreements, we review all material new vendor arrangements for potential embedded lease obligations. The asset balance related to operating and finance leases is presented within right-of-use (ROU) asset and property, plant and equipment, respectively, on our Consolidated Balance Sheet. The short-term liability balance related to operating and finance leases is presented within other accrued liabilities on our Consolidated Balance Sheets. The long-term liability balance is presented within long-term operating lease liability and long-term debt on our Consolidated Balance Sheets for operating and finance leases, respectively.  

The lease liability is recognized based on the present value of the remaining fixed or in-substance fixed lease payments discounted using our incremental borrowing rates. We use a specific incremental borrowing rate for our material leases, which is determined based on the geography and term of the lease. These rates are determined based on inputs provided by external banks and updated periodically. The lease liability includes the exercise of a purchase option only if we are reasonably certain to exercise as of the commencement date of the lease. The residual value guarantee amount is only included in the lease liability calculation to the extent payment is probable to the lessor as of the commencement of the lease. The ROU asset is calculated based on the lease liability adjusted for any lease payments paid to the lessor at or before the commencement date (i.e. prepaid rent) and initial direct costs incurred by Avon and excluding any lease incentives received from the Lessor.

Variable lease payments are payments to the lessor not included in the lease liability calculation. We define variable lease payments as payments made by Avon to the lessor for the right to use a leased asset that vary because of changes in facts or circumstances (such as changes in an index rate, volume, usage, etc.) occurring after the lease commencement date, other than predetermined contractual changes due to the passage of time (for example, predetermined rent increase amounts that are set out in the contract). Variable lease payments or charges are accounted for as incurred.

The lease term for purposes of lease accounting may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option as of the commencement date of the lease. For operating leases, the lease expense is recognized on a straight-line basis over the lease term. For finance leases, the Company amortizes the ROU asset on a straight-line basis and records interest expense on the lease liability created at lease commencement over the lease term.

We account for our lease and non-lease components as a single component for most of our asset classes, and therefore both are included in the calculation of lease liability recognized on the Consolidated Balance Sheets. However, for certain lease asset classes related to identified embedded leases we account for the lease and non-lease components separately, and therefore, the non-lease component is not included in the lease liability.

Leases with an initial term of twelve months or less are not recorded on the balance sheet; we recognize lease expense for these leases over their lease term. See Note 9, Leases, for further details.

Other Accounting Standards

ASU 2018-02, Income Statement - Reporting Comprehensive Income

In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income, which permits entities to reclassify the disproportionate income tax effects of the 2017 enactment of U.S. tax reform legislation (the "Act") on items within accumulated other comprehensive income (loss) to retained earnings. We adopted this new accounting guidance effective January 1, 2019 and elected not to reclassify the disproportionate income tax effects of the Act from accumulated other comprehensive income (loss) to retained earnings.

Accounting Standards to be Implemented

ASU 2016-13, Financial Instruments - Credit Losses

In January 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses, which requires measurement and recognition of expected credit losses for financial assets held. We intend to adopt this new accounting guidance effective January 1, 2020. We are currently assessing the impact on our consolidated financial statements.

XML

LOSS PER SHARE AND SHARE REPURCHASES (Tables)

6 Months Ended

Jun. 30, 2019

Earnings Per Share [Abstract]

Components of Basic and Diluted Earnings per Share

	Three Months Ended June 30,						Six Months Ended June 30,
(Shares in millions)	2019			2018			2019			2018
Numerator from continuing operations:
Loss from continuing operations, less amounts attributable to noncontrolling interests	$	(6.3	)	$	(36.1	)	$	(29.5	)	$	(56.4	)
Less: Loss allocated to participating securities	(.1		)	(.4		)	(.4		)	(.6		)
Less: Cumulative dividends on preferred stock	6.3			6.0			12.6			12.0
Loss from continuing operations allocated to common shareholders	(12.5		)	(41.7		)	(41.7		)	(67.8		)
Numerator from discontinued operations:
Loss from discontinued operations	$	(13.2	)	$	—		$	(22.7	)	$	—
Less: Loss allocated to participating securities	(.2		)	—			(.3		)	—
Loss allocated to common shareholders	(13.0		)	—			(22.4		)	—
Numerator attributable to Avon:
Net loss attributable to Avon	$	(19.5	)	$	(36.1	)	$	(52.2	)	$	(56.4	)
Less: Loss allocated to participating securities	(.3		)	(.4		)	(.7		)	(.6		)
Less: Cumulative dividends on preferred stock	6.3			6.0			12.6			12.0
Loss allocated to common shareholders	(25.5		)	(41.7		)	(64.1		)	(67.8		)
Denominator:
Basic EPS weighted-average shares outstanding	442.3			442.2			442.5			441.5
Diluted effect of assumed conversion of stock options	.2			—			.1			—
Diluted effect of assumed conversion of preferred stock	—			—			—			—
Diluted EPS adjusted weighted-average shares outstanding	442.5			442.2			442.6			441.5
Loss per Common Share from continuing operations:
Basic	$	(.03	)	$	(.09	)	$	(.09	)	$	(.15	)
Diluted	(.03		)	(.09		)	(.09		)	(.15		)
Loss per Common Share from discontinued operations:
Basic	$	(.03	)	$	—		$	(.05	)	$	—
Diluted	(.03		)	—			(.05		)	—
Loss per Common Share attributable to Avon:
Basic	$	(.06	)	$	(.09	)	$	(.14	)	$	(.15	)
Diluted	(.06		)	(.09		)	(.14		)	(.15		)

Amounts in the table above may not necessarily sum due to rounding.

XML

DISCONTINUED OPERATIONS, ASSETS AND LIABILITIES HELD FOR SALE AND DIVESTITURES (Tables)

6 Months Ended

Jun. 30, 2019

Discontinued Operations and Disposal Groups [Abstract]

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 New Avon are shown below:

	Three Months Ended June 30, 2019			Six Months Ended June 30, 2019
Selling, general and administrative expenses	$	13.2		$	22.7
Operating loss	$	(13.2	)	$	(22.7	)
Loss from discontinued operations, net of tax	$	(13.2	)	$	(22.7	)

The major classes of assets and liabilities comprising Held for sale assets and Held for sale liabilities on the Consolidated Balance Sheets as of June 30, 2019 and December 31, 2018 are shown in the following table.

	June 30, 2019
Current Held for sale assets
Property, Plant & Equipment (net)	$	10.1
	$	10.1

	December 31, 2018
	Avon Manufacturing (Guangzhou)		Rye Office		Malaysia Maximin		Total
Current held for sale assets
Inventories	$	8.7	$	—	$	—	$	8.7
Property, Plant & Equipment (net)	36.7		12.3		3.0		52.0
Cash and cash equivalents	3.7		—		—		3.7
Other assets	1.1		—		.1		1.2
	$	50.2	$	12.3	$	3.1	$	65.6
Current held for sale liabilities
Accounts payable	$	8.6	$	—	$	—	$	8.6
Other liabilities	2.6		—		.2		2.8
	$	11.2	$	—	$	.2	$	11.4

XML

RESTRICTED CASH (Tables)

6 Months Ended

Jun. 30, 2019

Restricted Cash and Cash Equivalents [Abstract]

Schedule of Cash and Cash Equivalents

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the Consolidated Balance Sheet that sum to the total of the same such amounts shown in the Consolidated Statement of Cash Flows for the six month period ended June 30, 2019.

	June 30, 2019		December 31, 2018
Cash and cash equivalents	$	421.0	$	532.7
Long-term restricted cash(1)	7.6		—
Held for sale cash and cash equivalents	—		3.7
Cash and cash equivalents, and restricted cash at end of period per the statement of cash flows	$	428.6	$	536.4

⁽¹⁾ Long-term restricted cash is presented in other assets in our Consolidated Balance Sheets.

XML

RELATED PARTY TRANSACTIONS (Tables)

6 Months Ended

Jun. 30, 2019

Related Party Transactions [Abstract]

Schedule of Related Party Transactions

The following tables present the related party transactions with New Avon, affiliates of Cerberus and the Instituto Avon in Brazil. There are no other related party transactions. New Avon is majority-owned and managed by Cerberus. See Note 5, Investment in New Avon for further details.

	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
Statement of Operations Data
Revenue from sale of product to New Avon(1)	$	3.7		$	7.1		$	8.5		$	13.0
Gross profit from sale of product to New Avon(1)	$	—		$	.4		$	.1		$	.7
Cost of sales for purchases from New Avon(2)	$	.8		$	.7		$	1.5		$	1.2
Selling, general and administrative expenses related to New Avon:
Transition services, intellectual property, technical support and innovation and subleases(3)	$	(.1	)	$	(.5	)	$	(.2	)	$	(3.7	)
Project management team(4)	2.1			.2			$	3.4		$	.8
Net reduction of selling, general and administrative expenses	$	2.0		$	(.3	)	$	3.2		$	(2.9	)
Interest income from Instituto Avon(5)	$	.1		$	—		$	.1		$	—

	June 30, 2019		December 31, 2018
Balance Sheet Data
Inventories(6)	$	.2	$	.3
Receivables due from New Avon(7)	$	3.0	$	7.0
Receivables due from Instituto Avon(5)	$	3.3	$	3.2
Payables due to New Avon(8)	$	1.0	$	.2
Payables due to an affiliate of Cerberus(9)	$	4.1	$	.6

(1) The Company supplies product to New Avon as part of a manufacturing and supply agreement.

(2) New Avon supplies product to the Company as part of the same manufacturing and supply agreement noted above. The Company purchased $.6 and $.5 from New Avon associated with this agreement during the three months ended June 30, 2019 and 2018, respectively, and recorded $.8 and $.7 associated with these purchases within cost of sales in our Consolidated Statement of Operations during the three months ended June 30, 2019 and 2018, respectively. The Company purchased $1.4 and $1.2 from New Avon associated with this agreement during the six months ended June 30, 2019 and 2018, respectively, and recorded $1.5 and $1.2 associated with these purchases within cost of sales in our Consolidated Statement of Operations during the six months ended June 30, 2019 and 2018, respectively.

(3) The Company also entered into a transition services agreement to provide certain services to New Avon, which expired on October 31, 2018, as well as an intellectual property ("IP") license agreement, an agreement for technical support and innovation and sublease for office space. The net amounts recorded within selling, general and administrative expenses generally represent 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 implementation of the Company’s strategic initiatives. The Company recorded net cost of $2.1 and $.2 in selling, general and administrative expenses associated with these agreements during the three months ended June 30, 2019 and 2018, respectively, and recorded $3.4 and $.8 in selling, general and administrative expenses associated with these agreements during the six months ended June 30, 2019 and 2018, respectively. See Note 15, Restructuring Initiatives for additional information related to the Company's strategic initiatives.

(5) During the second quarter of 2018, the Company entered into an agreement to loan the Instituto Avon, an independent non-government charitable organization in Brazil, R$12 million (Brazilian real) for an unsecured 5-year term at a fixed interest rate of 7% per annum, to be paid back in 5 equal annual installments. The Instituto Avon was created by an Avon subsidiary in Brazil,

with the board and executive team comprised of Avon Brazil management. The purpose of the loan is to provide the Instituto Avon with the means to donate funds to Fundação Pio XII (a leading cancer prevention and treatment organization in Brazil and owner of the Hospital do Câncer de Barretos), in order to invest in equipment with the objective of expanding breast cancer prevention and treatment.

(6) 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 our Consolidated Balance Sheets.

(7) The receivables due from New Avon relate to the agreements for transition services, the IP license agreement, technical support and innovation and subleases for office space, as well as the manufacturing and supply agreement, and were classified within prepaid expenses and other in our Consolidated Balance Sheets.

(8) The payables due to New Avon relate to the manufacturing and supply agreement and were classified within other accrued liabilities in our Consolidated Balance Sheets.

(9) 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 our Consolidated Balance Sheets.

XML

REVENUE (Tables)

6 Months Ended

Jun. 30, 2019

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

In the following table, revenue is disaggregated by product or service type. All revenue is recognized at a point in time when control of a product is transferred to a customer:

	Three Months Ended June 30, 2019
	Reportable segments
	Europe, Middle East & Africa		South Latin America			North Latin America		Asia Pacific		Total reportable segments			Other operating segments and business activities		Total
Beauty:
Skincare	$	136.6	$	130.1		$	49.9	$	29.3	$	345.9		$	—	$	345.9
Fragrance	123.8		114.5			45.6		19.2		303.1			—		303.1
Color	82.0		66.7			21.2		10.9		180.8			—		180.8
Total Beauty	342.4		311.3			116.7		59.4		829.8			—		829.8
Fashion & Home:
Fashion	55.2		41.3			19.9		39.8		156.2			—		156.2
Home	6.4		62.0			47.0		7.4		122.8			—		122.8
Total Fashion & Home	61.6		103.3			66.9		47.2		279.0			—		279.0
Product sales	404.0		414.6			183.6		106.6		1,108.8			—		1,108.8
Representative fees	21.0		28.8			10.2		1.7		61.7			—		61.7
Other	.1		(.4		)	—		.1		(.2		)	4.5		4.3
Other revenue	21.1		28.4			10.2		1.8		61.5			4.5		66.0
Total revenue	$	425.1	$	443.0		$	193.8	$	108.4	$	1,170.3		$	4.5	$	1,174.8

	Three Months Ended June 30, 2018
	Reportable segments
	Europe, Middle East & Africa		South Latin America		North Latin America		Asia Pacific		Total reportable segments		Other operating segments and business activities		Total
Beauty:
Skincare	$	154.4	$	143.9	$	43.8	$	30.3	$	372.4	$	2.3	$	374.7
Fragrance	143.8		131.5		52.4		20.1		347.8		.7		348.5
Color	98.1		80.6		20.8		12.9		212.4		1.4		213.8
Total Beauty	396.3		356.0		117.0		63.3		932.6		4.4		937.0
Fashion & Home:
Fashion	72.9		49.9		22.5		40.7		185.8		1.3		187.1
Home	7.6		72.5		56.6		7.5		144.3		.4		144.7
Total Fashion & Home	80.5		122.4		79.1		48.2		330.1		1.7		331.8
Product sales	476.8		478.4		196.1		111.5		1,262.7		6.1		1,268.8
Representative fees	23.7		35.2		11.2		1.5		71.6		.5		72.1
Other	.2		2.6		—		.1		2.9		8.1		11.0
Other revenue	23.9		37.8		11.2		1.6		74.5		8.6		83.1
Total revenue	$	500.7	$	516.1	$	207.3	$	113.1	$	1,337.2	$	14.7	$	1,351.9

	Six Months Ended June 30, 2019
	Reportable segments
	Europe, Middle East & Africa		South Latin America		North Latin America		Asia Pacific		Total reportable segments		Other operating segments and business activities		Total
Beauty:
Skincare	$	275.7	$	256.8	$	100.2	$	62.5	$	695.2	$	—	$	695.2
Fragrance	257.7		212.8		93.6		37.0		601.1		—		601.1
Color	175.9		126.9		43.1		24.1		370.0		—		370.0
Total Beauty	709.3		596.5		236.9		123.6		1,666.3		—		1,666.3
Fashion & Home:
Fashion	115.7		80.1		42.0		82.7		320.5		—		320.5
Home	14.9		122.2		87.3		13.8		238.2		—		238.2
Total Fashion & Home	130.6		202.3		129.3		96.5		558.7		—		558.7
Product sales	839.9		798.8		366.2		220.1		2,225.0		—		2,225.0
Representative fees	43.5		58.3		20.3		3.5		125.6		—		125.6
Other	.4		.6		—		.1		1.1		10.0		11.1
Other revenue	43.9		58.9		20.3		3.6		126.7		10.0		136.7
Total revenue	$	883.8	$	857.7	$	386.5	$	223.7	$	2,351.7	$	10.0	$	2,361.7

	Six Months Ended June 30, 2018
	Reportable segments
	Europe, Middle East & Africa		South Latin America		North Latin America		Asia Pacific		Total reportable segments		Other operating segments and business activities		Total
Beauty:
Skincare	$	323.8	$	285.7	$	90.5	$	61.6	$	761.5	$	7.0	$	768.5
Fragrance	307.0		250.0		106.0		38.7		701.8		2.9		704.7
Color	218.8		161.5		41.6		26.1		448.1		4.7		452.8
Total Beauty	849.6		697.2		238.1		126.4		1,911.4		14.6		1,926.0
Fashion & Home:
Fashion	152.6		96.4		45.1		80.4		374.5		3.0		377.5
Home	16.9		144.4		97.9		14.5		273.6		1.3		274.9
Total Fashion & Home	169.5		240.8		143.0		94.9		648.1		4.3		652.4
Product sales	1,019.1		938.0		381.1		221.3		2,559.5		18.9		2,578.4
Representative fees	49.7		71.5		21.8		3.1		146.1		1.9		148.0
Other	.3		3.7		—		.1		4.1		14.9		19.0
Other revenue	50.0		75.2		21.8		3.2		150.2		16.8		167.0
Total revenue	$	1,069.1	$	1,013.2	$	402.9	$	224.5	$	2,709.7	$	35.7	$	2,745.4

Receivables and Contract Liabilities from Contracts with Customers

The following table provides information about receivables and contract liabilities from contracts with customers at June 30, 2019 and December 31, 2018:

	June 30, 2019		December 31, 2018
Accounts receivable, net of allowances of $72 and $93	$	332.8	$	349.7
Contract liabilities	$	55.7	$	84.4

XML

INVENTORIES (Tables)

6 Months Ended

Jun. 30, 2019

Inventory Disclosure [Abstract]

Schedule of Components of Inventories

Components of Inventories	June 30, 2019		December 31, 2018
Raw materials	$	150.8	$	157.8
Finished goods	364.8		384.2
Total	$	515.6	$	542.0

XML

LEASES (Tables)

6 Months Ended

Jun. 30, 2019

Leases [Abstract]

Assets and Liabilities, Lessee

	Classification	June 30, 2019		January 1, 2019
Assets
Operating right-of-use assets	Right-of-use asset	$	174.9	$	187.5
Finance right-of-use assets	Property, Plant and Equipment	3.0		3.2
Total right-of-use assets		177.9		190.7
Liabilities
Current
Operating lease liabilities	Other accrued liabilities	$	43.8	$	45.4
Finance lease liabilities	Other accrued liabilities	1.2		1.1
Total current lease liabilities		45.0		46.5
Noncurrent
Operating lease liabilities	Long-term operating lease liability	$	144.8	$	155.9
Finance lease liabilities	Long-term debt	1.8		1.9
Total noncurrent lease liabilities		$	146.6	$	157.8
Total lease liability		$	191.6	$	204.3

Lease Cost

The table below shows the lease income and expenses recorded in the Consolidated Statement of Operations incurred during the three and six months ended June 30, 2019.

		Three months ended June 30,			Six months ended June 30,
Lease Costs	Classification	2019			2019
Operating lease cost (1)	Selling, general and administrative expenses	$	16.6		$	33.3
Finance lease cost
Amortization of right-of-use assets	Selling, general and administrative expenses	.4			.9
Interest on lease liabilities	Interest Expense	.1			.2
Short-term leases costs	Selling, general and administrative expenses	.8			1.9
Sublease income (2)	Selling, general and administrative expenses	(2.6		)	(5.8		)
Net lease cost		$	15.3		$	30.5

⁽¹⁾ Includes variable lease costs which are immaterial. These are presented in selling, general and administrative expenses in our Consolidated Statements of Operations.

⁽²⁾ Sublease portfolio consists of the sublease of our previous principal executive office located at 777 Third Avenue, New York, NY.

Operating Lease Maturity Analysis

The maturity analysis of the finance and operating lease liabilities is reflected below. This table also reflects the reconciliation of the undiscounted cash flows to the discounted finance and operating lease liabilities as recognized in the June 30, 2019 Consolidated Balance Sheet:

Maturity of Lease Liabilities	Operating Leases		Finance Leases		Total
2019	$	30.7	$	.7	$	31.4
2020	52.8		1.2		54.0
2021	43.5		.8		44.3
2022	36.5		.5		37.0
2023	24.3		.1		24.4
2024	17.1		—		17.1
Thereafter	27.6		—		27.6
Total lease payments	$	232.5	$	3.3	$	235.8
Less: Interest	43.9		.3		44.2
Present value of lease liabilities	$	188.6	$	3.0	$	191.6

Finance Lease Maturity Analysis

The maturity analysis of the finance and operating lease liabilities is reflected below. This table also reflects the reconciliation of the undiscounted cash flows to the discounted finance and operating lease liabilities as recognized in the June 30, 2019 Consolidated Balance Sheet:

Maturity of Lease Liabilities	Operating Leases		Finance Leases		Total
2019	$	30.7	$	.7	$	31.4
2020	52.8		1.2		54.0
2021	43.5		.8		44.3
2022	36.5		.5		37.0
2023	24.3		.1		24.4
2024	17.1		—		17.1
Thereafter	27.6		—		27.6
Total lease payments	$	232.5	$	3.3	$	235.8
Less: Interest	43.9		.3		44.2
Present value of lease liabilities	$	188.6	$	3.0	$	191.6

Operating Lease by Due Dates

At December 31, 2018 our operating and finance lease obligations by due dates were as follows:

Maturity of Lease Liabilities	Operating Leases		Finance Leases		Total
2019	$	56.4	$	1.1	$	57.5
2020	42.0		.6		42.6
2021	35.3		.4		35.7
2022	31.1		.2		31.3
2023	22.4		.1		22.5
Thereafter	46.9		.1		47.0
Total lease payments(1)	$	234.1	$	2.5	$	236.6

⁽¹⁾ Total lease payments of $236.6 represent undiscounted cash flows and therefore do not reconcile to the total discounted lease liability of $204.3 at January 1, 2019 shown above.

Financing Lease by Due Dates

At December 31, 2018 our operating and finance lease obligations by due dates were as follows:

Maturity of Lease Liabilities	Operating Leases		Finance Leases		Total
2019	$	56.4	$	1.1	$	57.5
2020	42.0		.6		42.6
2021	35.3		.4		35.7
2022	31.1		.2		31.3
2023	22.4		.1		22.5
Thereafter	46.9		.1		47.0
Total lease payments(1)	$	234.1	$	2.5	$	236.6

⁽¹⁾ Total lease payments of $236.6 represent undiscounted cash flows and therefore do not reconcile to the total discounted lease liability of $204.3 at January 1, 2019 shown above.

Lease Terms

The Company has calculated the weighted-average remaining lease term, presented in years below, and the weighted-average discount rate for our operating and finance lease population. As noted in our lease accounting policy (See Note 1, Accounting Policies), the Company uses the incremental borrowing rate as the lease discount rate.

Lease Term and Discount Rate	June 30, 2019
Weighted-average remaining lease term (years)
Operating leases	5.0
Finance leases	2.8
Weighted-average discount rate
Operating leases	8.5	%
Finance leases	11.4	%

Cash Flow Classification

The table below sets out the classification of lease payments in the Consolidated Statement of Cash Flows. The right-of-use assets obtained in exchange for new finance and operating lease liabilities represent the new operating and finance leases entered into during the three and six months ended June 30, 2019.

Other Information	Three months ended June 30, 2019			Six months ended June 30, 2019
- Operating Cash Flows From Operating Leases	$	(15.8	)	$	(32.1	)
- Financing Cash Flows From Finance Leases	(.3		)	(.7		)
Cash Paid For Amounts Included In Measurement of Liabilities	$	(16.1	)	$	(32.8	)
Right-of-use Assets Obtained In Exchange For New Finance Liabilities	$	(.1	)	$	(.9	)
Right-of-use Assets Obtained In Exchange For New Operating Liabilities	$	(8.0	)	$	(20.0	)

XML

EMPLOYEE BENEFIT PLANS (Tables)

6 Months Ended

Jun. 30, 2019

Retirement Benefits, Description [Abstract]

Schedule of Components of Net Periodic Benefit Cost

	Three Months Ended June 30,
	Pension Benefits
Net Periodic Benefit Costs	U.S. Plans						Non-U.S. Plans						Postretirement Benefits
	2019			2018			2019			2018			2019		2018
Service cost(1)	$	.5		$	.9		$	1.0		$	1.2		$	—	$	—
Interest cost	.6			.6			3.8			4.0			.3		.3
Expected return on plan assets	(.8		)	(.8		)	(7.7		)	(8.2		)	—		—
Amortization of prior service credit	—			—			—			—			—		(.1		)
Amortization of net actuarial losses	.7			1.3			1.3			1.8			—		—
Net periodic benefit costs(1)	$	1.0		$	2.0		$	(1.6	)	$	(1.2	)	$	.3	$	.2

	Six Months Ended June 30,
	Pension Benefits
Net Periodic Benefit Costs	U.S. Plans						Non-U.S. Plans						Postretirement Benefits
	2019			2018			2019			2018			2019		2018
Service cost	$	1.0		$	1.8		$	2.0		$	2.4		$	—	$	.1
Interest cost	1.2			1.2			7.7			8.2			.6		.6
Expected return on plan assets	(1.6		)	(1.6		)	(15.6		)	(16.6		)	—		—
Amortization of prior service credit	—			—			—			—			—		(.2		)
Amortization of net actuarial losses	1.4			2.6			2.6			3.6			—		—
Settlements/curtailments	—			—			0.1			—			—		—
Net periodic benefit costs(1)	$	2.0		$	4.0		$	(3.2	)	$	(2.4	)	$	.6	$	.5

⁽¹⁾ Service cost is presented in selling, general and administrative expenses in our Consolidated Statements of Operations. The components of net periodic benefit costs other than service cost are presented in other expense, net in our Consolidated Statements of Operations.

XML

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

6 Months Ended

Jun. 30, 2019

Equity [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 June 30, 2019 and 2018:

Three Months Ended June 30, 2019	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Investment in New Avon		Total
Balance at March 31, 2019	$	(939.6	)	$	(1.4	)	$	(4.3	)	$	(92.5	)	$	3.4	$	(1,034.4	)
Other comprehensive loss other than reclassifications	4.4			(1.0		)	—			—			—		3.4
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0	—			.3			—			—			—		.3
Amortization of net actuarial loss and prior service cost, net of tax of $.2(1)	—			—			—			1.8			—		1.8
Total reclassifications into earnings	—			.3			—			1.8			—		2.1
Balance at June 30, 2019	$	(935.2	)	$	(2.1	)	$	(4.3	)	$	(90.7	)	$	3.4	$	(1,028.9	)

Three Months Ended June 30, 2018	Foreign Currency Translation Adjustments			Net Investment Hedges			Pension and Postretirement Benefits			Investment in New Avon		Total
Balance at March 31, 2018	$	(797.3	)	$	(4.3	)	$	(92.8	)	$	3.4	$	(891.0	)
Other comprehensive income other than reclassifications	(126.2		)	—			—			—		(126.2		)
Reclassifications into earnings:
Amortization of net actuarial loss and prior service cost, net of tax of $.1(1)	—			—			2.8			—		2.8
Total reclassifications into earnings	—			—			2.8			—		2.8
Balance at June 30, 2018	$	(923.5	)	$	(4.3	)	$	(90.0	)	$	3.4	$	(1,014.4	)

Six Months Ended June 30, 2019	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Investment in New Avon		Total
Balance at December 31, 2018	$	(936.2	)	$	.5		$	(4.3	)	$	(93.8	)	$	3.4	$	(1,030.4	)
Other comprehensive loss other than reclassifications	1.0			(3.4		)	—			—			—		(2.4		)
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0	—			.8			—			—			—		.8
Amortization of net actuarial loss and prior service cost, net of tax of $.3(1)	—			—			—			3.1			—		3.1
Total reclassifications into earnings	—			.8			—			3.1			—		3.9
Balance at June 30, 2019	$	(935.2	)	$	(2.1	)	$	(4.3	)	$	(90.7	)	$	3.4	$	(1,028.9	)

Six Months Ended June 30, 2018:	Foreign Currency Translation Adjustments			Net Investment Hedges			Pension and Postretirement Benefits			Investment in New Avon		Total
Balance at December 31, 2017	$	(829.6	)	$	(4.3	)	$	(95.7	)	$	3.4	$	(926.2	)
Other comprehensive income other than reclassifications	(93.9		)	—			—			—		(93.9		)
Reclassifications into earnings:
Amortization of net actuarial loss and prior service cost, net of tax of $0.3(1)	—			—			5.7			—		5.7
Total reclassifications into earnings	—			—			5.7			—		5.7
Balance at June 30, 2018	$	(923.5	)	$	(4.3	)	$	(90.0	)	$	3.4	$	(1,014.4	)

(1) Gross amount reclassified to other expense, net in our Consolidated Statements of Operations, and related taxes reclassified to income taxes in our Consolidated Statements of Operations.

XML

SEGMENT INFORMATION (Tables)

6 Months Ended

Jun. 30, 2019

Segment Reporting [Abstract]

Summarized Financial Information of Reportable Segments

Summarized financial information concerning our reportable segments was as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
Total Revenue	2019		2018		2019		2018
Europe, Middle East & Africa	$	425.1	$	500.7	$	883.8	$	1,069.1
South Latin America	443.0		516.1		857.7		1,013.2
North Latin America	193.8		207.3		386.5		402.9
Asia Pacific	108.4		113.1		223.7		224.5
Total revenue from reportable segments	1,170.3		1,337.2		2,351.7		2,709.7
Other operating segments and business activities(1)	4.5		14.7		10.0		35.7
Total revenue	$	1,174.8	$	1,351.9	$	2,361.7	$	2,745.4

	Three Months Ended June 30,						Six Months Ended June 30,
Operating Profit	2019			2018			2019			2018
Segment Profit
Europe, Middle East & Africa	$	59.0		$	74.4		$	118.2		$	148.8
South Latin America	65.2			55.2			89.0			82.4
North Latin America	19.1			19.0			35.6			39.8
Asia Pacific	10.8			7.3			27.5			17.7
Total profit from reportable segments	$	154.1		$	155.9		$	270.3		$	288.7
Other operating segments and business activities(1)	.5			(.6		)	1.1			1.6
Unallocated global expenses	(65.3		)	(78.6		)	(128.4		)	(157.8		)
CTI restructuring initiatives	(45.7		)	(23.7		)	(99.2		)	(34.6		)
Other expenses(2)	(13.1		)	—			(17.2		)	—
Operating profit	$	30.5		$	53.0		$	26.6		$	97.9

(1) Other operating segments and business activities include markets that have been exited. Effective in the first quarter of 2018, given that we exited Australia and New Zealand during 2018, the results of Australia and New Zealand are now reported in Other operating segments and business activities for all periods presented, while previously the results had been reported in the Asia Pacific segment. 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.

(2) Other expenses includes primarily professional fees incurred in relation to the Natura transaction, and other impairment losses on assets.

XML

SUPPLEMENTAL BALANCE SHEET INFORMATION (Tables)

6 Months Ended

Jun. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Components of Prepaid Expenses and Other

At June 30, 2019 and December 31, 2018, prepaid expenses and other included the following:

Components of Prepaid Expenses and Other	June 30, 2019		December 31, 2018
Prepaid taxes and tax refunds receivable	$	155.0	$	145.0
Receivables other than trade	53.2		69.2
Prepaid brochure costs, paper and other literature	13.6		14.9
Other	42.4		42.9
Prepaid expenses and other	$	264.2	$	272.0

Schedule of Components of Other Assets

At June 30, 2019 and December 31, 2018, other assets included the following:

Components of Other Assets(1)	June 30, 2019		December 31, 2018
Net overfunded pension plans	$	95.5	$	88.1
Capitalized software	85.0		89.3
Judicial deposits	74.8		74.1
Long-term receivables	90.6		73.2
Trust assets associated with supplemental benefit plans	37.9		37.0
Tooling (plates and molds associated with our beauty products)	12.5		12.6
Other	38.0		16.1
Other assets	$	434.3	$	390.4

(1) Deferred tax asset balance as of June 30, 2019 and December 31, 2018 is presented separately in the Consolidated Balance sheet.

XML

RESTRUCTURING INITIATIVES (Tables)

6 Months Ended

Jun. 30, 2019

Restructuring and Related Activities [Abstract]

Summary of Restructuring and Related Costs

The costs during the three and six months ended June 30, 2019 and 2018 consisted of the following:

	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
CTI recorded in operating profit - COGS
Manufacturing asset write-offs	$	6.0		$	—		$	9.8		$	—
Inventory write-off	2.6			.4			3.1			1.1
	8.6			.4			12.9			1.1
CTI recorded in operating profit - SG&A
Net charges for employee-related costs, including severance benefits	13.4			16.5			48.6			24.8
Implementation costs, primarily related to professional service fees	17.3			4.7			26.0			5.7
Dual running costs	2.6			—			4.5			—
Contract termination and other net benefits	1.4			1.2			4.6			1.4
Impairment of other assets	2.3			—			2.3			—
Accelerated depreciation	.1			.9			.3			1.6
	37.1			23.3			86.3			33.5
CTI recorded in operating profit	45.7			23.7			99.2			34.6
CTI recorded in other expenses
Gain on sale of Rye Office	(9.9		)	—			(9.9		)	—
Gain on sale of Malaysia Maximin	(3.3		)	—			(3.3		)	—
Gain on sale of China business (relating mainly to foreign currency translation adjustment gain)	—			—			(10.3		)	—
Total CTI	$	32.5		$	23.7		$	75.7		$	34.6
Open Up Avon	$	28.3		$	—		$	73.4		$	—
Transformation Plan	$	4.2		$	24.5		$	2.2		$	35.3
Other	$	—		$	(.8	)	$	.1		$	(.7	)

The following table presents the restructuring charges incurred to date, under Open Up Avon and the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plans:

	Employee- Related Costs		Inventory/ Asset Write-offs		Contract Terminations/Other		Foreign Currency Translation Adjustment Write-offs			Total
Open Up Avon
Charges incurred to-date	$	76.1	$	105.1	$	5.2	$	(10.9	)	$	175.5
Estimated charges to be incurred on approved initiatives	—		—		.1		—			.1
Total expected charges on approved initiatives	$	76.1	$	105.1	$	5.3	$	(10.9	)	$	175.6
Transformation Plan
Charges incurred to-date	$	126.9	$	2.3	$	40.9	$	3.4		$	173.5
Estimated charges to be incurred on approved initiatives	—		—		—		—			—
Total expected charges on approved initiatives	$	126.9	$	2.3	$	40.9	$	3.4		$	173.5

Schedule of Restructuring Reserve

The liability balance included in other accrued liabilities in our Consolidated Statements of Operations for the restructuring actions associated with Open Up Avon at June 30, 2019 is as follows:

	Employee-Related Costs			Inventory/Assets Write-offs			Foreign Currency Translation Adjustment Write-offs			Contract Terminations/Other			Total
Balance at December 31, 2018	$	19.6		$	—		$	—		$	1.1		$	20.7
2019 charges	$	52.9		$	15.2		$	(10.9	)	$	4.5		61.7
Adjustments	(3.1		)	—			—			(.1		)	(3.2		)
Cash payments	(35.4		)	—			—			(1.8		)	(37.2		)
Non-cash write-offs	—			(15.2		)	10.9			—			(4.3		)
Foreign exchange	(.8		)	—			—			—			(.8		)
Balance at June 30, 2019	$	33.2		$	—		$	—		$	3.7		$	36.9

The liability balance included in other accrued liabilities in our Consolidated Balance Sheet for the restructuring actions associated with our Transformation Plan as of June 30, 2019 is as follows:

	Employee-Related Costs			Contract Terminations/Other			Total
Balance at December 31, 2018	$	34.4		$	3.6		$	38.0
2019 charges	(1.1		)	.2			(.9		)
Cash payments	(19.9		)	(2.7		)	(22.6		)
Foreign exchange	.1			—			.1
Balance at June 30, 2019	$	13.5		$	1.1		$	14.6

Schedule of Restructuring Charges Reportable by Business Segment

The charges, net of adjustments, of initiatives under the Open Up Avon and the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plans, by reportable segment are as follows:

	Europe, Middle East & Africa			South Latin America		North Latin America			Asia Pacific			Global & Other Operating Segments		Total
Open Up Avon
2018	$	32.2		$	36.4	$	27.9		$	14.4		$	6.2	$	117.1
First quarter 2019	13.5			12.7		2.9			(3.2		)	7.3		33.2
Second quarter 2019	4.5			13.7		4.3			(1.2		)	3.9		25.2
Charges incurred to-date	50.2			62.8		35.1			10.0			17.4		175.5
Estimated charges to be incurred on approved initiatives	.1			—		—			—			—		.1
Total expected charges on approved initiatives	$	50.3		$	62.8	$	35.1		$	10.0		$	17.4	$	175.6
Transformation Plan
2015	$	—		$	—	$	—		$	—		$	21.4	$	21.4
2016	30.9			13.2		4.4			9.1			16.8		74.4
2017	.9			5.6		(.6		)	(.5		)	49.4		54.8
2018	5.0			4.1		.6			.6			13.4		23.7
First quarter 2019	(1.1		)	—		—			—			.3		(.8		)
Second quarter 2019	—			—		—			—			—		—
Charges incurred to-date	35.7			22.9		4.4			9.2			101.3		173.5
Estimated charges to be incurred on approved initiatives	—			—		—			—			—		—
Total expected charges on approved initiatives	$	35.7		$	22.9	$	4.4		$	9.2		$	101.3	$	173.5

XML

GOODWILL (Tables)

6 Months Ended

Jun. 30, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

	Europe, Middle East & Africa			South Latin America		Asia Pacific		Total
Net balance at December 31, 2018	$	18.0		$	66.8	$	2.6	$	87.4
Changes during the period ended June 30, 2019:
Foreign exchange	(.3		)	2.8		—		2.5
Net balance at June 30, 2019	$	17.7		$	69.6	$	2.6	$	89.9

XML

FAIR VALUE (Tables)

6 Months Ended

Jun. 30, 2019

Fair Value Disclosures [Abstract]

Fair Value of Assets and Liabilities Measured 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 June 30, 2019:

	Level 1		Level 2		Total
Assets:
Available-for-sale securities	$	3.8	$	—	$	3.8
Foreign exchange forward contracts	$	—	$	1.2	$	1.2
Total	$	3.8	$	1.2	$	5.0
Liabilities:
Foreign exchange forward contracts	$	—	$	10.9	$	10.9
Total	$	—	$	10.9	$	10.9

Summary of Carrying Value and 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 June 30, 2019 and December 31, 2018, respectively, consisted of the following:

	June 30, 2019						December 31, 2018
	Carrying Amount			Fair Value			Carrying Amount			Fair Value
Available-for-sale securities	$	3.8		$	3.8		$	3.8		$	3.8
Debt maturing within one year(1)	(398.5		)	(408.1		)	(12.0		)	(12.0		)
Long-term debt(1)	(1,197.0		)	(1,254.0		)	(1,581.6		)	(1,460.2		)
Foreign exchange forward contracts	(9.7		)	(9.7		)	(5.1		)	(5.1		)

(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.

XML

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

6 Months Ended

Jun. 30, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Fair Value of Derivative Instruments

The following table presents the fair value of derivative instruments at June 30, 2019:

	Asset			Liability
	Balance Sheet Classification	Fair Value		Balance Sheet Classification	Fair Value
Derivatives designated as hedges:
Foreign exchange forward contracts	Prepaid expenses and other	$	—	Accounts payable	$	2.0
Derivatives not designated as hedges:
Foreign exchange forward contracts	Prepaid expenses and other	$	1.2	Accounts payable	$	8.9
Total derivatives		$	1.2		$	10.9

XML

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		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Numerator from continuing operations:
Loss from continuing operations, less amounts attributable to noncontrolling interests	$ (6.3)	$ (36.1)	$ (29.5)	$ (56.4)
Less: Loss allocated to participating securities	(0.1)	(0.4)	(0.4)	(0.6)
Less: Cumulative dividends on preferred stock	6.3	6.0	12.6	12.0
Loss from continuing operations allocated to common shareholders	(12.5)	(41.7)	(41.7)	(67.8)
Numerator from discontinued operations:
Loss from discontinued operations	(13.2)	0.0	(22.7)	0.0
Less: Loss allocated to participating securities	(0.2)	0.0	(0.3)	0.0
Loss allocated to common shareholders	(13.0)	0.0	(22.4)	0.0
Numerator attributable to Avon:
Net loss attributable to Avon	(19.5)	(36.1)	(52.2)	(56.4)
Less: Loss allocated to participating securities	(0.3)	(0.4)	(0.7)	(0.6)
Less: Cumulative dividends on preferred stock	6.3	6.0	12.6	12.0
Loss allocated to common shareholders	$ (25.5)	$ (41.7)	$ (64.1)	$ (67.8)
Denominator:
Basic EPS weighted-average shares outstanding (in shares)	442.3	442.2	442.5	441.5
Diluted effect of assumed conversion of stock options (in shares)	0.2	0.0	0.1	0.0
Diluted effect of assumed conversion of preferred stock (in shares)	0.0	0.0	0.0	0.0
Diluted EPS adjusted weighted-average shares outstanding (in shares)	442.5	442.2	442.6	441.5
Loss per Common Share from continuing operations:
Basic (in dollars per share)	$ (0.03)	$ (0.09)	$ (0.09)	$ (0.15)
Diluted (in dollars per share)	(0.03)	(0.09)	(0.09)	(0.15)
Loss per Common Share from discontinued operations:
Basic (in dollars per share)	(0.03)	0	(0.05)	0
Diluted (in dollars per share)	(0.03)	0	(0.05)	0
Loss per Common Share attributable to Avon:
Basic (in dollars per share)	(0.06)	(0.09)	(0.14)	(0.15)
Diluted (in dollars per share)	$ (0.06)	$ (0.09)	$ (0.14)	$ (0.15)

XML

LOSS PER SHARE AND SHARE REPURCHASES (Narrative) (Details) - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Earnings Per Share [Abstract]
Stock options excluded from computation of earnings per share (in shares)	19.4	18.5	18.8	17.4
Converted Series C Convertible Preferred Stock (in shares)	87.1	87.1	87.1	87.1
Stock repurchased during the period (in shares)			0.4	1.1
Stock repurchased during the period			$ 1.1	$ 3.2

XML

DISCONTINUED OPERATIONS, ASSETS AND LIABILITIES HELD FOR SALE AND DIVESTITURES - Additional Information (Details) - USD ($) $ in Millions					3 Months Ended			6 Months Ended
	Jun. 26, 2019	May 09, 2019	Feb. 15, 2019	Dec. 17, 2015	Jun. 30, 2019	Mar. 31, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Net proceeds from sale of business / assets					$ 30.1		$ 0.0	$ 76.5	$ 0.0
Gain on sale of business / assets					13.2		$ 0.0	23.5	$ 0.0
Restricted cash					7.6			7.6
North America Segment | Discontinued Operations
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Proceeds from issuance of convertible preferred stock				$ 435.0
Rye Office
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Sale purchase price	$ 23.2
Acquisition expenses	0.8
Net proceeds from sale of business / assets	$ 22.4
Gain on sale of business / assets					9.9
Held for sale asset adjustment					0.2
Malaysia Maximin
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Sale purchase price		$ 7.8
Net proceeds from sale of business / assets		$ 7.6
Gain on sale of business / assets					3.3
Held for sale asset adjustment					1.4
Gain on sale, net of tax					3.0
Avon Manufacturing (Guangzhou), Ltd.
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Net proceeds from sale of business / assets			$ 46.4
Gain on sale of business / assets						$ 10.3
Gain on sale, net of tax						$ 8.2
Restricted cash					$ 7.6			$ 7.6
Avon Manufacturing (Guangzhou), Ltd. | TheFaceShop Co., LTd.
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Sale purchase price			71.0
Acquisition expenses			1.1
Loans assumed			$ 23.5

XML

DISCONTINUED OPERATIONS, ASSETS AND LIABILITIES HELD FOR SALE AND DIVESTITURES - 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	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2019	Dec. 31, 2018
Current Held for sale assets
Cash and cash equivalents	$ 0.0	$ 0.0	$ 3.7
Discontinued Operations
Current held for sale liabilities
Liabilities	18.1	18.1	0.0
Held for Sale
Current Held for sale assets
Inventories			8.7
Property, Plant & Equipment (net)			52.0
Cash and cash equivalents			3.7
Other assets			1.2
Assets			65.6
Current held for sale liabilities
Accounts payable			8.6
Other liabilities			2.8
Liabilities	0.0	0.0	11.4
North America Segment | Discontinued Operations
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Selling, general and administrative expenses	13.2	22.7
Operating loss	(13.2)	(22.7)
Loss from discontinued operations, net of tax	(13.2)	(22.7)
Avon Manufacturing Guangzhou | Held for Sale
Current Held for sale assets
Inventories			8.7
Property, Plant & Equipment (net)			36.7
Cash and cash equivalents			3.7
Other assets			1.1
Assets			50.2
Current held for sale liabilities
Accounts payable			8.6
Other liabilities			2.6
Liabilities			11.2
Rye Office | Held for Sale
Current Held for sale assets
Inventories			0.0
Property, Plant & Equipment (net)	10.1	10.1	12.3
Cash and cash equivalents			0.0
Other assets			0.0
Assets	$ 10.1	$ 10.1	12.3
Current held for sale liabilities
Accounts payable			0.0
Other liabilities			0.0
Liabilities			0.0
Malaysia Maximin | Held for Sale
Current Held for sale assets
Inventories			0.0
Property, Plant & Equipment (net)			3.0
Cash and cash equivalents			0.0
Other assets			0.1
Assets			3.1
Current held for sale liabilities
Accounts payable			0.0
Other liabilities			0.2
Liabilities			$ 0.2

XML

RESTRICTED CASH (Details) - USD ($) $ in Millions		Jun. 30, 2019		Mar. 31, 2019	[2]	Dec. 31, 2018		Jun. 30, 2018	[1]	Mar. 31, 2018	[2]	Dec. 31, 2017	[2]
Restricted Cash and Cash Equivalents [Abstract]
Cash and cash equivalents		$ 421.0				$ 532.7
Long-term restricted cash	[1]	7.6				0.0
Held for sale cash and cash equivalents		0.0				3.7
Cash and cash equivalents, and restricted cash at end of period per the statement of cash flows		$ 428.6	[1]	$ 431.0		$ 536.4	[2]	$ 443.9		$ 772.5		$ 881.5

[1] Includes restricted cash of $7.6 related to the sale of Avon Manufacturing (Guangzhou), Ltd. at June 30, 2019

[2] The balance at the beginning of the six month period ended June 30, 2019 includes cash and cash equivalents of $3.7 classified as Held for sale assets in our Consolidated Balance Sheets at the end of the year in 2018

XML

INVESTMENT IN NEW AVON (Details) - USD ($)	3 Months Ended			6 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Apr. 30, 2019	Dec. 31, 2018
Schedule of Equity Method Investments [Line Items]
Investment balance							$ 0
Net proceeds from sale of business / assets		$ 30,100,000	$ 0	$ 76,500,000	$ 0
New Avon
Schedule of Equity Method Investments [Line Items]
Percentage of ownership		19.90%		19.90%		19.90%
Investment balance		$ 0		$ 0
Transaction costs		$ 1,000,000.0
Forecast | New Avon
Schedule of Equity Method Investments [Line Items]
Net proceeds from sale of business / assets	$ 24,900,000
LG Household & Health Care Ltd. | Forecast | New Avon
Schedule of Equity Method Investments [Line Items]
Net proceeds from sale of business / assets	$ 125,000,000.0

XML

RELATED PARTY TRANSACTIONS (Summary of Related Parties) (Details) R$ in Millions, $ in Millions	3 Months Ended			6 Months Ended
	Jun. 30, 2019 USD ($)	Jun. 30, 2018 BRL (R$) installment	Jun. 30, 2018 USD ($) installment	Jun. 30, 2019 USD ($)	Jun. 30, 2018 USD ($)	Dec. 31, 2018 USD ($)
Related Party Transaction [Line Items]
Inventories	$ 0.2			$ 0.2		$ 0.3
Equity Method Investee
Related Party Transaction [Line Items]
Net reduction of selling, general and administrative expenses	2.0		$ (0.3)	3.2	$ (2.9)
Equity Method Investee | Manufacturing and Supply Agreement
Related Party Transaction [Line Items]
Revenue from sale of product to New Avon	3.7		7.1	8.5	13.0
Gross profit from sale of product to New Avon	0.0		0.4	0.1	0.7
Cost of sales for purchases from New Avon	0.8		0.7	1.5	1.2
Purchases from related party	0.6		0.5	1.4	1.2
Equity Method Investee | Transition Services Agreement
Related Party Transaction [Line Items]
Net reduction of selling, general and administrative expenses	(0.1)		(0.5)	(0.2)	(3.7)
Equity Method Investee | Project Management Agreement
Related Party Transaction [Line Items]
Net reduction of selling, general and administrative expenses	2.1		0.2	3.4	0.8
New Avon
Related Party Transaction [Line Items]
Receivables due from related party	3.0			3.0		7.0
Payables to related parties	1.0			1.0		0.2
Affiliate of Cerberus
Related Party Transaction [Line Items]
Payables to related parties	4.1			4.1		0.6
Instituto Avon | Affiliated Entity
Related Party Transaction [Line Items]
Interest income from Instituto Avon	0.1		$ 0.0	0.1	$ 0.0
Receivables due from related party	$ 3.3			$ 3.3		$ 3.2
Instituto Avon | Affiliated Entity | Loan to Related Party
Related Party Transaction [Line Items]
Loan amount | R$		R$ 12
Loan term		5 years	5 years
Loan interest rate		7.00%	7.00%
Loan annual installments | installment		5	5

XML

RELATED PARTY TRANSACTIONS (Details) - USD ($)		6 Months Ended
	Mar. 01, 2016	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Related Party Transaction [Line Items]
Dividend rate	1.25%
Series C convertible preferred stock		$ 504,700,000		$ 492,100,000
Dividends		0	$ 0
Equity Method Investee
Related Party Transaction [Line Items]
Standby letters of credit, recorded liability		800,000
Series C Preferred Stock
Related Party Transaction [Line Items]
Shares issued (in shares)	435,000
Shares issued	$ 435,000,000.0
Dividends payable		78,000,000.0
Private Placement
Related Party Transaction [Line Items]
Preferred stock, discount on shares		$ 8,700,000

XML

REVENUE Disaggregation of Revenues (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Disaggregation of Revenue [Line Items]
Revenue	$ 1,174.8	$ 1,351.9	$ 2,361.7	$ 2,745.4
Beauty
Disaggregation of Revenue [Line Items]
Revenue	829.8	937.0	1,666.3	1,926.0
Beauty - Skincare
Disaggregation of Revenue [Line Items]
Revenue	345.9	374.7	695.2	768.5
Beauty - Fragrance
Disaggregation of Revenue [Line Items]
Revenue	303.1	348.5	601.1	704.7
Beauty - Color
Disaggregation of Revenue [Line Items]
Revenue	180.8	213.8	370.0	452.8
Fashion And Home
Disaggregation of Revenue [Line Items]
Revenue	279.0	331.8	558.7	652.4
Fashion & Home - Fashion
Disaggregation of Revenue [Line Items]
Revenue	156.2	187.1	320.5	377.5
Fashion & Home - Home
Disaggregation of Revenue [Line Items]
Revenue	122.8	144.7	238.2	274.9
Product Sales
Disaggregation of Revenue [Line Items]
Revenue	1,108.8	1,268.8	2,225.0	2,578.4
Other Revenue
Disaggregation of Revenue [Line Items]
Revenue	66.0	83.1	136.7	167.0
Other - Representative Fees
Disaggregation of Revenue [Line Items]
Revenue	61.7	72.1	125.6	148.0
Other - Other Product And Services
Disaggregation of Revenue [Line Items]
Revenue	4.3	11.0	11.1	19.0
Operating Segments
Disaggregation of Revenue [Line Items]
Revenue	1,170.3	1,337.2	2,351.7	2,709.7
Operating Segments | Beauty
Disaggregation of Revenue [Line Items]
Revenue	829.8	932.6	1,666.3	1,911.4
Operating Segments | Beauty - Skincare
Disaggregation of Revenue [Line Items]
Revenue	345.9	372.4	695.2	761.5
Operating Segments | Beauty - Fragrance
Disaggregation of Revenue [Line Items]
Revenue	303.1	347.8	601.1	701.8
Operating Segments | Beauty - Color
Disaggregation of Revenue [Line Items]
Revenue	180.8	212.4	370.0	448.1
Operating Segments | Fashion And Home
Disaggregation of Revenue [Line Items]
Revenue	279.0	330.1	558.7	648.1
Operating Segments | Fashion & Home - Fashion
Disaggregation of Revenue [Line Items]
Revenue	156.2	185.8	320.5	374.5
Operating Segments | Fashion & Home - Home
Disaggregation of Revenue [Line Items]
Revenue	122.8	144.3	238.2	273.6
Operating Segments | Product Sales
Disaggregation of Revenue [Line Items]
Revenue	1,108.8	1,262.7	2,225.0	2,559.5
Operating Segments | Other Revenue
Disaggregation of Revenue [Line Items]
Revenue	61.5	74.5	126.7	150.2
Operating Segments | Other - Representative Fees
Disaggregation of Revenue [Line Items]
Revenue	61.7	71.6	125.6	146.1
Operating Segments | Other - Other Product And Services
Disaggregation of Revenue [Line Items]
Revenue	(0.2)	2.9	1.1	4.1
Other Operating Segments and Business Activities
Disaggregation of Revenue [Line Items]
Revenue	4.5	14.7	10.0	35.7
Other Operating Segments and Business Activities | Beauty
Disaggregation of Revenue [Line Items]
Revenue	0.0	4.4	0.0	14.6
Other Operating Segments and Business Activities | Beauty - Skincare
Disaggregation of Revenue [Line Items]
Revenue	0.0	2.3	0.0	7.0
Other Operating Segments and Business Activities | Beauty - Fragrance
Disaggregation of Revenue [Line Items]
Revenue	0.0	0.7	0.0	2.9
Other Operating Segments and Business Activities | Beauty - Color
Disaggregation of Revenue [Line Items]
Revenue	0.0	1.4	0.0	4.7
Other Operating Segments and Business Activities | Fashion And Home
Disaggregation of Revenue [Line Items]
Revenue	0.0	1.7	0.0	4.3
Other Operating Segments and Business Activities | Fashion & Home - Fashion
Disaggregation of Revenue [Line Items]
Revenue	0.0	1.3	0.0	3.0
Other Operating Segments and Business Activities | Fashion & Home - Home
Disaggregation of Revenue [Line Items]
Revenue	0.0	0.4	0.0	1.3
Other Operating Segments and Business Activities | Product Sales
Disaggregation of Revenue [Line Items]
Revenue	0.0	6.1	0.0	18.9
Other Operating Segments and Business Activities | Other Revenue
Disaggregation of Revenue [Line Items]
Revenue	4.5	8.6	10.0	16.8
Other Operating Segments and Business Activities | Other - Representative Fees
Disaggregation of Revenue [Line Items]
Revenue	0.0	0.5	0.0	1.9
Other Operating Segments and Business Activities | Other - Other Product And Services
Disaggregation of Revenue [Line Items]
Revenue	4.5	8.1	10.0	14.9
Europe, Middle East & Africa | Operating Segments
Disaggregation of Revenue [Line Items]
Revenue	425.1	500.7	883.8	1,069.1
Europe, Middle East & Africa | Operating Segments | Beauty
Disaggregation of Revenue [Line Items]
Revenue	342.4	396.3	709.3	849.6
Europe, Middle East & Africa | Operating Segments | Beauty - Skincare
Disaggregation of Revenue [Line Items]
Revenue	136.6	154.4	275.7	323.8
Europe, Middle East & Africa | Operating Segments | Beauty - Fragrance
Disaggregation of Revenue [Line Items]
Revenue	123.8	143.8	257.7	307.0
Europe, Middle East & Africa | Operating Segments | Beauty - Color
Disaggregation of Revenue [Line Items]
Revenue	82.0	98.1	175.9	218.8
Europe, Middle East & Africa | Operating Segments | Fashion And Home
Disaggregation of Revenue [Line Items]
Revenue	61.6	80.5	130.6	169.5
Europe, Middle East & Africa | Operating Segments | Fashion & Home - Fashion
Disaggregation of Revenue [Line Items]
Revenue	55.2	72.9	115.7	152.6
Europe, Middle East & Africa | Operating Segments | Fashion & Home - Home
Disaggregation of Revenue [Line Items]
Revenue	6.4	7.6	14.9	16.9
Europe, Middle East & Africa | Operating Segments | Product Sales
Disaggregation of Revenue [Line Items]
Revenue	404.0	476.8	839.9	1,019.1
Europe, Middle East & Africa | Operating Segments | Other Revenue
Disaggregation of Revenue [Line Items]
Revenue	21.1	23.9	43.9	50.0
Europe, Middle East & Africa | Operating Segments | Other - Representative Fees
Disaggregation of Revenue [Line Items]
Revenue	21.0	23.7	43.5	49.7
Europe, Middle East & Africa | Operating Segments | Other - Other Product And Services
Disaggregation of Revenue [Line Items]
Revenue	0.1	0.2	0.4	0.3
South Latin America | Operating Segments
Disaggregation of Revenue [Line Items]
Revenue	443.0	516.1	857.7	1,013.2
South Latin America | Operating Segments | Beauty
Disaggregation of Revenue [Line Items]
Revenue	311.3	356.0	596.5	697.2
South Latin America | Operating Segments | Beauty - Skincare
Disaggregation of Revenue [Line Items]
Revenue	130.1	143.9	256.8	285.7
South Latin America | Operating Segments | Beauty - Fragrance
Disaggregation of Revenue [Line Items]
Revenue	114.5	131.5	212.8	250.0
South Latin America | Operating Segments | Beauty - Color
Disaggregation of Revenue [Line Items]
Revenue	66.7	80.6	126.9	161.5
South Latin America | Operating Segments | Fashion And Home
Disaggregation of Revenue [Line Items]
Revenue	103.3	122.4	202.3	240.8
South Latin America | Operating Segments | Fashion & Home - Fashion
Disaggregation of Revenue [Line Items]
Revenue	41.3	49.9	80.1	96.4
South Latin America | Operating Segments | Fashion & Home - Home
Disaggregation of Revenue [Line Items]
Revenue	62.0	72.5	122.2	144.4
South Latin America | Operating Segments | Product Sales
Disaggregation of Revenue [Line Items]
Revenue	414.6	478.4	798.8	938.0
South Latin America | Operating Segments | Other Revenue
Disaggregation of Revenue [Line Items]
Revenue	28.4	37.8	58.9	75.2
South Latin America | Operating Segments | Other - Representative Fees
Disaggregation of Revenue [Line Items]
Revenue	28.8	35.2	58.3	71.5
South Latin America | Operating Segments | Other - Other Product And Services
Disaggregation of Revenue [Line Items]
Revenue	(0.4)	2.6	0.6	3.7
North Latin America | Operating Segments
Disaggregation of Revenue [Line Items]
Revenue	193.8	207.3	386.5	402.9
North Latin America | Operating Segments | Beauty
Disaggregation of Revenue [Line Items]
Revenue	116.7	117.0	236.9	238.1
North Latin America | Operating Segments | Beauty - Skincare
Disaggregation of Revenue [Line Items]
Revenue	49.9	43.8	100.2	90.5
North Latin America | Operating Segments | Beauty - Fragrance
Disaggregation of Revenue [Line Items]
Revenue	45.6	52.4	93.6	106.0
North Latin America | Operating Segments | Beauty - Color
Disaggregation of Revenue [Line Items]
Revenue	21.2	20.8	43.1	41.6
North Latin America | Operating Segments | Fashion And Home
Disaggregation of Revenue [Line Items]
Revenue	66.9	79.1	129.3	143.0
North Latin America | Operating Segments | Fashion & Home - Fashion
Disaggregation of Revenue [Line Items]
Revenue	19.9	22.5	42.0	45.1
North Latin America | Operating Segments | Fashion & Home - Home
Disaggregation of Revenue [Line Items]
Revenue	47.0	56.6	87.3	97.9
North Latin America | Operating Segments | Product Sales
Disaggregation of Revenue [Line Items]
Revenue	183.6	196.1	366.2	381.1
North Latin America | Operating Segments | Other Revenue
Disaggregation of Revenue [Line Items]
Revenue	10.2	11.2	20.3	21.8
North Latin America | Operating Segments | Other - Representative Fees
Disaggregation of Revenue [Line Items]
Revenue	10.2	11.2	20.3	21.8
North Latin America | Operating Segments | Other - Other Product And Services
Disaggregation of Revenue [Line Items]
Revenue	0.0	0.0	0.0	0.0
Asia Pacific | Operating Segments
Disaggregation of Revenue [Line Items]
Revenue	108.4	113.1	223.7	224.5
Asia Pacific | Operating Segments | Beauty
Disaggregation of Revenue [Line Items]
Revenue	59.4	63.3	123.6	126.4
Asia Pacific | Operating Segments | Beauty - Skincare
Disaggregation of Revenue [Line Items]
Revenue	29.3	30.3	62.5	61.6
Asia Pacific | Operating Segments | Beauty - Fragrance
Disaggregation of Revenue [Line Items]
Revenue	19.2	20.1	37.0	38.7
Asia Pacific | Operating Segments | Beauty - Color
Disaggregation of Revenue [Line Items]
Revenue	10.9	12.9	24.1	26.1
Asia Pacific | Operating Segments | Fashion And Home
Disaggregation of Revenue [Line Items]
Revenue	47.2	48.2	96.5	94.9
Asia Pacific | Operating Segments | Fashion & Home - Fashion
Disaggregation of Revenue [Line Items]
Revenue	39.8	40.7	82.7	80.4
Asia Pacific | Operating Segments | Fashion & Home - Home
Disaggregation of Revenue [Line Items]
Revenue	7.4	7.5	13.8	14.5
Asia Pacific | Operating Segments | Product Sales
Disaggregation of Revenue [Line Items]
Revenue	106.6	111.5	220.1	221.3
Asia Pacific | Operating Segments | Other Revenue
Disaggregation of Revenue [Line Items]
Revenue	1.8	1.6	3.6	3.2
Asia Pacific | Operating Segments | Other - Representative Fees
Disaggregation of Revenue [Line Items]
Revenue	1.7	1.5	3.5	3.1
Asia Pacific | Operating Segments | Other - Other Product And Services
Disaggregation of Revenue [Line Items]
Revenue	$ 0.1	$ 0.1	$ 0.1	$ 0.1

XML

REVENUE Assets and Liabilities (Details) - USD ($) $ in Millions	Jun. 30, 2019	Dec. 31, 2018
Revenue from Contract with Customer [Abstract]
Accounts receivable, net of allowances of $72 and $93	$ 332.8	$ 349.7
Account receivable allowances	72.0	93.0
Contract liabilities	$ 55.7	$ 84.4

XML

REVENUE Narrative (Details) $ in Millions	6 Months Ended
	Jun. 30, 2019 USD ($)
Revenue from Contract with Customer [Abstract]
Performance obligations satisfied	$ 63.4
Material rights	$ 34.5

XML

INVENTORIES (Components of Inventories) (Details) - USD ($) $ in Millions	Jun. 30, 2019	Dec. 31, 2018
Inventory Disclosure [Abstract]
Raw materials	$ 150.8	$ 157.8
Finished goods	364.8	384.2
Inventories	$ 515.6	$ 542.0

XML

LEASES - Balance Sheet Implication (Details) - USD ($) $ in Millions	Jun. 30, 2019	Jan. 01, 2019
Leases [Abstract]
Operating right-of-use assets	$ 174.9	$ 187.5
Finance right-of-use assets	3.0	3.2
Total right-of-use assets	177.9	190.7
Operating lease liabilities	43.8	45.4
Finance lease liabilities	1.2	1.1
Total current lease liabilities	45.0	46.5
Operating lease liabilities	144.8	155.9
Finance lease liabilities	1.8	1.9
Total noncurrent lease liabilities	146.6	157.8
Total lease liability	$ 191.6	$ 204.3

XML

LEASES - Income and Expenses (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2019
Leases [Abstract]
Operating lease cost	$ 16.6	$ 33.3
Amortization of right-of-use assets	0.4	0.9
Interest on lease liabilities	0.1	0.2
Short-term leases costs	0.8	1.9
Sublease income	(2.6)	(5.8)
Net lease cost	$ 15.3	$ 30.5

XML

LEASES - Maturity of Lease Liability (Details) - USD ($) $ in Millions	Jun. 30, 2019	Jan. 01, 2019
Operating Leases
2019	$ 30.7
2020	52.8
2021	43.5
2022	36.5
2023	24.3
2024	17.1
Thereafter	27.6
Total lease payments	232.5
Less: Interest	43.9
Present value of lease liabilities	188.6
Finance Leases
2019	0.7
2020	1.2
2021	0.8
2022	0.5
2023	0.1
2024	0.0
Thereafter	0.0
Total lease payments	3.3
Less: Interest	0.3
Present value of lease liabilities	3.0
Total
2019	31.4
2020	54.0
2021	44.3
2022	37.0
2023	24.4
2024	17.1
Thereafter	27.6
Total lease payments	235.8
Less: Interest	44.2
Present value of lease liabilities	$ 191.6	$ 204.3

XML

LEASES - Lease by Due Date (Details) - USD ($) $ in Millions	Jun. 30, 2019	Jan. 01, 2019	Dec. 31, 2018
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
2019			$ 56.4
2020			42.0
2021			35.3
2022			31.1
2023			22.4
Thereafter			46.9
Total lease payments			234.1
Finance Leases
2019			1.1
2020			0.6
2023			0.4
2024			0.2
2025			0.1
Thereafter			0.1
Total lease payments			2.5
Total
2019			57.5
2020			42.6
2021			35.7
2022			31.3
2023			22.5
Thereafter			47.0
Total lease payments			$ 236.6
Total lease liability	$ 191.6	$ 204.3

XML

LEASES - Lease Term and Discount Rate (Details)	Jun. 30, 2019
Leases [Abstract]
Weighted-average remaining lease term, operating leases	5 years
Weighted-average remaining lease term, finance leases	2 years 9 months 18 days
Weighted-average discount rate, operating leases	8.50%
Weighted-average discount rate, financing leases	11.40%

XML

LEASES - Other Information (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2019
Leases [Abstract]
Operating Cash Flows From Operating Leases	$ (15.8)	$ (32.1)
Financing Cash Flows From Finance Leases	(0.3)	(0.7)
Cash Paid For Amounts Included In Measurement of Liabilities	(16.1)	(32.8)
Right-of-use Assets Obtained In Exchange For New Finance Liabilities	(0.1)	(0.9)
Right-of-use Assets Obtained In Exchange For New Operating Liabilities	$ (8.0)	$ (20.0)

XML

EMPLOYEE BENEFIT PLANS (Components of Net Periodic Benefit Cost) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Postretirement Benefits
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 0.0	$ 0.0	$ 0.0	$ 0.1
Interest cost	0.3	0.3	0.6	0.6
Expected return on plan assets	0.0	0.0	0.0	0.0
Amortization of prior service credit	0.0	(0.1)	0.0	(0.2)
Amortization of net actuarial losses	0.0	0.0	0.0	0.0
Settlements/curtailments			0.0	0.0
Net periodic benefit costs	0.3	0.2	0.6	0.5
United States | Pension Plan
Defined Benefit Plan Disclosure [Line Items]
Service cost	0.5	0.9	1.0	1.8
Interest cost	0.6	0.6	1.2	1.2
Expected return on plan assets	(0.8)	(0.8)	(1.6)	(1.6)
Amortization of prior service credit	0.0	0.0	0.0	0.0
Amortization of net actuarial losses	0.7	1.3	1.4	2.6
Settlements/curtailments			0.0	0.0
Net periodic benefit costs	1.0	2.0	2.0	4.0
Foreign Plan | Pension Plan
Defined Benefit Plan Disclosure [Line Items]
Service cost	1.0	1.2	2.0	2.4
Interest cost	3.8	4.0	7.7	8.2
Expected return on plan assets	(7.7)	(8.2)	(15.6)	(16.6)
Amortization of prior service credit	0.0	0.0	0.0	0.0
Amortization of net actuarial losses	1.3	1.8	2.6	3.6
Settlements/curtailments			0.1	0.0
Net periodic benefit costs	$ (1.6)	$ (1.2)	$ (3.2)	$ (2.4)

XML

EMPLOYEE BENEFIT PLANS (Narrative) (Details) $ in Millions	6 Months Ended
	Jun. 30, 2019 USD ($)
United States
Defined Benefit Plan Disclosure [Line Items]
Employer contribution, approximately	$ 1
United States | Minimum
Defined Benefit Plan Disclosure [Line Items]
Estimated contributions for the remainder of fiscal year	0
United States | Maximum
Defined Benefit Plan Disclosure [Line Items]
Estimated contributions for the remainder of fiscal year	5
Foreign Plan
Defined Benefit Plan Disclosure [Line Items]
Employer contribution, approximately	2
Foreign Plan | Minimum
Defined Benefit Plan Disclosure [Line Items]
Estimated contributions for the remainder of fiscal year	0
Foreign Plan | Maximum
Defined Benefit Plan Disclosure [Line Items]
Estimated contributions for the remainder of fiscal year	$ 5

XML

CONTINGENCIES (Details) $ in Millions	3 Months Ended			6 Months Ended
	Jun. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Jun. 30, 2018 USD ($)	Jun. 30, 2019 USD ($) lawsuit	Jun. 30, 2018 USD ($)	Apr. 18, 2018 USD ($)	Oct. 03, 2017 USD ($)	Jul. 31, 2013 USD ($)
Loss Contingencies [Line Items]
Revenue	$ 1,174.8		$ 1,351.9	$ 2,361.7	$ 2,745.4
Other expense, net	6.8		(19.4)	$ 29.4	(21.9)
Number of litigation suits | lawsuit				118
Number of litigation suits, new | lawsuit				9
Number of litigation suits, dismissed | lawsuit				9
Assessment for 2012
Loss Contingencies [Line Items]
Assessment of contingencies, including penalties and accruing interest						$ 248.0		$ 314.0
Assessment of contingencies, including penalties and accruing interest, adjustment						$ 66.0
Assessment for 2017
Loss Contingencies [Line Items]
Assessment of contingencies, including penalties and accruing interest							$ 243.0
IPI Tax on Cosmetics
Loss Contingencies [Line Items]
Estimated litigation liability			$ 195.0		$ 195.0
Revenue		$ 168.0
Other expense, net		$ 27.0
Possible loss	255.0			$ 255.0
Tax reserve	80.0			80.0
Brazil labor-related
Loss Contingencies [Line Items]
Estimated litigation liability	$ 12.0			$ 12.0

XML

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Components of Accumulated Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Accumulated other comprehensive income, beginning balance			$ (904.5)
Other comprehensive loss other than reclassifications	$ 3.4	$ (126.2)	(2.4)	$ (93.9)
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax	0.3		0.8
Amortization of net actuarial loss and prior service cost, net of tax	1.8	2.8	3.1	5.7
Total reclassifications into earnings	2.1	2.8	3.9	5.7
Accumulated other comprehensive income, ending balance	(964.5)		(964.5)
Derivative losses on cash flow hedges, tax	0.0		0.0
Amortization of net actuarial loss and prior service cost, tax	0.2	0.1	0.3	0.3
Foreign Currency Translation Adjustments
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Accumulated other comprehensive income, beginning balance	(939.6)	(797.3)	(936.2)	(829.6)
Other comprehensive loss other than reclassifications	4.4	(126.2)	1.0	(93.9)
Reclassifications into earnings:
Amortization of net actuarial loss and prior service cost, net of tax	0.0	0.0	0.0	0.0
Total reclassifications into earnings	0.0	0.0	0.0	0.0
Accumulated other comprehensive income, ending balance	(935.2)	(923.5)	(935.2)	(923.5)
Cash Flow Hedges
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Accumulated other comprehensive income, beginning balance	(1.4)		0.5
Other comprehensive loss other than reclassifications	(1.0)		(3.4)
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax	0.3		0.8
Amortization of net actuarial loss and prior service cost, net of tax	0.0		0.0
Total reclassifications into earnings	0.3		0.8
Accumulated other comprehensive income, ending balance	(2.1)		(2.1)
Net Investment Hedges
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Accumulated other comprehensive income, beginning balance	(4.3)	(4.3)	(4.3)	(4.3)
Other comprehensive loss other than reclassifications	0.0	0.0	0.0	0.0
Reclassifications into earnings:
Amortization of net actuarial loss and prior service cost, net of tax	0.0	0.0	0.0	0.0
Total reclassifications into earnings	0.0	0.0	0.0	0.0
Accumulated other comprehensive income, ending balance	(4.3)	(4.3)	(4.3)	(4.3)
Pension and Postretirement Benefits
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Accumulated other comprehensive income, beginning balance	(92.5)	(92.8)	(93.8)	(95.7)
Other comprehensive loss other than reclassifications	0.0	0.0	0.0	0.0
Reclassifications into earnings:
Amortization of net actuarial loss and prior service cost, net of tax	1.8	2.8	3.1	5.7
Total reclassifications into earnings	1.8	2.8	3.1	5.7
Accumulated other comprehensive income, ending balance	(90.7)	(90.0)	(90.7)	(90.0)
Investment in New Avon
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Accumulated other comprehensive income, beginning balance	3.4	3.4	3.4	3.4
Other comprehensive loss other than reclassifications	0.0	0.0	0.0	0.0
Reclassifications into earnings:
Amortization of net actuarial loss and prior service cost, net of tax	0.0	0.0	0.0	0.0
Total reclassifications into earnings	0.0	0.0	0.0	0.0
Accumulated other comprehensive income, ending balance	3.4	3.4	3.4	3.4
AOCI Attributable to Parent
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Accumulated other comprehensive income, beginning balance	(1,034.4)	(891.0)	(1,030.4)	(926.2)
Reclassifications into earnings:
Accumulated other comprehensive income, ending balance	$ (1,028.9)	$ (1,014.4)	$ (1,028.9)	$ (1,014.4)

XML

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Equity [Abstract]
Foreign exchange losses	$ 2.3	$ 9.6	$ 0.7	$ 3.7

XML

SEGMENT INFORMATION (Total Revenue and Operating Profit by Reporting Segment) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Segment Reporting Information [Line Items]
Total revenue	$ 1,174.8	$ 1,351.9	$ 2,361.7	$ 2,745.4
Operating profit	30.5	53.0	26.6	97.9
CTI restructuring initiatives	(32.5)	(23.7)	(75.7)	(34.6)
Other expense, net	6.8	(19.4)	29.4	(21.9)
Reportable segments
Segment Reporting Information [Line Items]
Total revenue	1,170.3	1,337.2	2,351.7	2,709.7
Operating profit	154.1	155.9	270.3	288.7
Other Operating Segments and Business Activities
Segment Reporting Information [Line Items]
Total revenue	4.5	14.7	10.0	35.7
Operating profit	0.5	(0.6)	1.1	1.6
All other
Segment Reporting Information [Line Items]
Unallocated global expenses	(65.3)	(78.6)	(128.4)	(157.8)
CTI restructuring initiatives	(45.7)	(23.7)	(99.2)	(34.6)
Other expense, net	(13.1)	0.0	(17.2)	0.0
Europe, Middle East & Africa | Reportable segments
Segment Reporting Information [Line Items]
Total revenue	425.1	500.7	883.8	1,069.1
Operating profit	59.0	74.4	118.2	148.8
South Latin America | Reportable segments
Segment Reporting Information [Line Items]
Total revenue	443.0	516.1	857.7	1,013.2
Operating profit	65.2	55.2	89.0	82.4
North Latin America | Reportable segments
Segment Reporting Information [Line Items]
Total revenue	193.8	207.3	386.5	402.9
Operating profit	19.1	19.0	35.6	39.8
Asia Pacific | Reportable segments
Segment Reporting Information [Line Items]
Total revenue	108.4	113.1	223.7	224.5
Operating profit	$ 10.8	$ 7.3	$ 27.5	$ 17.7

XML

SUPPLEMENTAL BALANCE SHEET INFORMATION (Components of Prepaid Expenses and Other) (Details) - USD ($) $ in Millions	Jun. 30, 2019	Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Prepaid taxes and tax refunds receivable	$ 155.0	$ 145.0
Receivables other than trade	53.2	69.2
Prepaid brochure costs, paper and other literature	13.6	14.9
Other	42.4	42.9
Prepaid expenses and other	$ 264.2	$ 272.0

XML

SUPPLEMENTAL BALANCE SHEET INFORMATION (Components of Other Assets) (Details) - USD ($) $ in Millions	Jun. 30, 2019	Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Net overfunded pension plans	$ 95.5	$ 88.1
Capitalized software	85.0	89.3
Judicial deposits	74.8	74.1
Long-term receivables	90.6	73.2
Trust assets associated with supplemental benefit plans	37.9	37.0
Tooling (plates and molds associated with our beauty products)	12.5	12.6
Other	38.0	16.1
Other assets	$ 434.3	$ 390.4

XML

RESTRUCTURING INITIATIVES (Details)	1 Months Ended		3 Months Ended		6 Months Ended		12 Months Ended
	Sep. 30, 2018 USD ($)	Jan. 31, 2016 USD ($)	Jun. 30, 2019 USD ($)	Jun. 30, 2018 USD ($)	Jun. 30, 2019 USD ($)	Jun. 30, 2018 USD ($)	Dec. 31, 2018 USD ($)
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs			$ 32,500,000	$ 23,700,000	$ 75,700,000	$ 34,600,000
Reduction in workforce					(0.10)		(0.08)
Estimated charges to be incurred on approved initiatives			100,000		$ 100,000
Open Up Avon
Restructuring Cost and Reserve [Line Items]
Expected annualized savings before taxes	$ 400,000
Restructuring charges and other costs			28,300,000	0	73,400,000	0
Estimated charges to be incurred on approved initiatives			100,000		100,000
Recorded total costs to implement restructuring initiatives			216,600,000		216,600,000
Open Up Avon | Inventory/ Asset Write-offs
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs							$ 88,000
Estimated charges to be incurred on approved initiatives			0		0
Transformation Plan
Restructuring Cost and Reserve [Line Items]
Expected annualized savings before taxes		$ 350,000,000
Restructuring charges and other costs			4,200,000	24,500,000	2,200,000	35,300,000
Estimated charges to be incurred on approved initiatives			0		0
Recorded total costs to implement restructuring initiatives			207,700,000		207,700,000
Transformation Plan | Inventory/ Asset Write-offs
Restructuring Cost and Reserve [Line Items]
Estimated charges to be incurred on approved initiatives			0		0
Other Restructuring Initiatives
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs			$ 0	$ (800,000)	$ 100,000	$ (700,000)

XML

RESTRUCTURING INITIATIVES - Summary (Details) - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	$ 32,500,000	$ 23,700,000	$ 75,700,000	$ 34,600,000
Open Up Avon
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	28,300,000	0	73,400,000	0
Transformation Plan
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	4,200,000	24,500,000	2,200,000	35,300,000
Other Restructuring Initiatives
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	0	(800,000)	100,000	(700,000)
Inventory write-off | Open Up Avon
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives					$ 88,000
Cost of Goods Sold
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	8,600,000	400,000	12,900,000	1,100,000
Cost of Goods Sold | Manufacturing asset write-offs
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	6,000,000.0	0	9,800,000	0
Cost of Goods Sold | Inventory write-off
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	2,600,000	400,000	3,100,000	1,100,000
Selling, General and Administrative Expense
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	37,100,000	23,300,000	86,300,000	33,500,000
Selling, General and Administrative Expense | Net charges for employee-related costs, including severance benefits
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	13,400,000	16,500,000	48,600,000	24,800,000
Selling, General and Administrative Expense | Implementation costs, primarily related to professional service fees
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	17,300,000	4,700,000	26,000,000.0	5,700,000
Selling, General and Administrative Expense | Dual running costs
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	2,600,000	0	4,500,000	0
Selling, General and Administrative Expense | Contract termination and other net benefits
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	1,400,000	1,200,000	4,600,000	1,400,000
Selling, General and Administrative Expense | Impairment of other assets
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	2,300,000	0	2,300,000	0
Selling, General and Administrative Expense | Accelerated depreciation
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	100,000	900,000	300,000	1,600,000
Operating Profit
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	45,700,000	23,700,000	99,200,000	34,600,000
Other Expenses | Gain on sale of Rye Office
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	(9,900,000)	0	(9,900,000)	0
Other Expenses | Gain on sale of Malaysia Maximin
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	(3,300,000)	0	(3,300,000)	0
Other Expenses | Gain on sale of China business (relating mainly to foreign currency translation adjustment gain)
Restructuring Cost and Reserve [Line Items]
CTI restructuring initiatives	$ 0	$ 0	$ (10,300,000)	$ 0

XML

RESTRUCTURING INITIATIVES - OPEN UP AVON (Details) - Open Up Avon $ in Millions	6 Months Ended
	Jun. 30, 2019 USD ($)
Restructuring Reserve [Roll Forward]
Balance at December 31, 2018	$ 20.7
2019 charges	61.7
Adjustments	(3.2)
Cash payments	(37.2)
Non-cash write-offs	(4.3)
Foreign exchange	(0.8)
Balance at June 30, 2019	36.9
Employee-Related Costs
Restructuring Reserve [Roll Forward]
Balance at December 31, 2018	19.6
2019 charges	52.9
Adjustments	(3.1)
Cash payments	(35.4)
Non-cash write-offs	0.0
Foreign exchange	(0.8)
Balance at June 30, 2019	33.2
Inventory/ Asset Write-offs
Restructuring Reserve [Roll Forward]
Balance at December 31, 2018	0.0
2019 charges	15.2
Adjustments	0.0
Cash payments	0.0
Non-cash write-offs	(15.2)
Foreign exchange	0.0
Balance at June 30, 2019	0.0
Foreign Currency Translation Adjustment Write-offs
Restructuring Reserve [Roll Forward]
Balance at December 31, 2018	0.0
2019 charges	(10.9)
Adjustments	0.0
Cash payments	0.0
Non-cash write-offs	10.9
Foreign exchange	0.0
Balance at June 30, 2019	0.0
Contract Terminations/Other
Restructuring Reserve [Roll Forward]
Balance at December 31, 2018	1.1
2019 charges	4.5
Adjustments	(0.1)
Cash payments	(1.8)
Non-cash write-offs	0.0
Foreign exchange	0.0
Balance at June 30, 2019	$ 3.7

XML

RESTRUCTURING INITIATIVES - TRANSFORMATION PLAN (Liability Balances) (Details) - Transformation Plan $ in Millions	6 Months Ended
	Jun. 30, 2019 USD ($)
Restructuring Reserve [Roll Forward]
Balance at December 31, 2018	$ 38.0
2019 charges	(0.9)
Cash payments	(22.6)
Foreign exchange	0.1
Balance at June 30, 2019	14.6
Employee-Related Costs
Restructuring Reserve [Roll Forward]
Balance at December 31, 2018	34.4
2019 charges	(1.1)
Cash payments	(19.9)
Foreign exchange	0.1
Balance at June 30, 2019	13.5
Contract Terminations/Other
Restructuring Reserve [Roll Forward]
Balance at December 31, 2018	3.6
2019 charges	0.2
Cash payments	(2.7)
Foreign exchange	0.0
Balance at June 30, 2019	$ 1.1

XML

RESTRUCTURING INITIATIVES (Restructuring Initiatives by Charge Type) (Details) $ in Thousands	Jun. 30, 2019 USD ($)
Restructuring Cost and Reserve [Line Items]
Estimated charges to be incurred on approved initiatives	$ 100
Open Up Avon
Restructuring Cost and Reserve [Line Items]
Charges incurred to-date	175,500
Estimated charges to be incurred on approved initiatives	100
Total expected charges on approved initiatives	175,600
Open Up Avon | Employee-Related Costs
Restructuring Cost and Reserve [Line Items]
Charges incurred to-date	76,100
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	76,100
Open Up Avon | Inventory/ Asset Write-offs
Restructuring Cost and Reserve [Line Items]
Charges incurred to-date	105,100
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	105,100
Open Up Avon | Contract Terminations/Other
Restructuring Cost and Reserve [Line Items]
Charges incurred to-date	5,200
Estimated charges to be incurred on approved initiatives	100
Total expected charges on approved initiatives	5,300
Open Up Avon | Foreign Currency Translation Adjustment Write-offs
Restructuring Cost and Reserve [Line Items]
Charges incurred to-date	(10,900)
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	(10,900)
Transformation Plan
Restructuring Cost and Reserve [Line Items]
Charges incurred to-date	173,500
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	173,500
Transformation Plan | Employee-Related Costs
Restructuring Cost and Reserve [Line Items]
Charges incurred to-date	126,900
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	126,900
Transformation Plan | Inventory/ Asset Write-offs
Restructuring Cost and Reserve [Line Items]
Charges incurred to-date	2,300
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	2,300
Transformation Plan | Contract Terminations/Other
Restructuring Cost and Reserve [Line Items]
Charges incurred to-date	40,900
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	40,900
Transformation Plan | Foreign Currency Translation Adjustment Write-offs
Restructuring Cost and Reserve [Line Items]
Charges incurred to-date	3,400
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	$ 3,400

XML

RESTRUCTURING INITIATIVES (Charges Reportable by Business Segment) (Details) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Restructuring Cost and Reserve [Line Items]
Estimated charges to be incurred on approved initiatives	$ 100
Open Up Avon
Restructuring Cost and Reserve [Line Items]
Charges incurred	25,200	$ 33,200	$ 117,100
Charges incurred to-date	175,500
Estimated charges to be incurred on approved initiatives	100
Total expected charges on approved initiatives	175,600
Open Up Avon | Europe, Middle East & Africa
Restructuring Cost and Reserve [Line Items]
Charges incurred	4,500	13,500	32,200
Charges incurred to-date	50,200
Estimated charges to be incurred on approved initiatives	100
Total expected charges on approved initiatives	50,300
Open Up Avon | South Latin America
Restructuring Cost and Reserve [Line Items]
Charges incurred	13,700	12,700	36,400
Charges incurred to-date	62,800
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	62,800
Open Up Avon | North Latin America
Restructuring Cost and Reserve [Line Items]
Charges incurred	4,300	2,900	27,900
Charges incurred to-date	35,100
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	35,100
Open Up Avon | Asia Pacific
Restructuring Cost and Reserve [Line Items]
Charges incurred	(1,200)	(3,200)	14,400
Charges incurred to-date	10,000
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	10,000
Open Up Avon | Global & Other Operating Segments
Restructuring Cost and Reserve [Line Items]
Charges incurred	3,900	7,300	6,200
Charges incurred to-date	17,400
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	17,400
Transformation Plan
Restructuring Cost and Reserve [Line Items]
Charges incurred	0	(800)	23,700	$ 54,800	$ 74,400	$ 21,400
Charges incurred to-date	173,500
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	173,500
Transformation Plan | Europe, Middle East & Africa
Restructuring Cost and Reserve [Line Items]
Charges incurred	0	(1,100)	5,000	900	30,900	0
Charges incurred to-date	35,700
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	35,700
Transformation Plan | South Latin America
Restructuring Cost and Reserve [Line Items]
Charges incurred	0	0	4,100	5,600	13,200	0
Charges incurred to-date	22,900
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	22,900
Transformation Plan | North Latin America
Restructuring Cost and Reserve [Line Items]
Charges incurred	0	0	600	(600)	4,400	0
Charges incurred to-date	4,400
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	4,400
Transformation Plan | Asia Pacific
Restructuring Cost and Reserve [Line Items]
Charges incurred	0	0	600	(500)	9,100	0
Charges incurred to-date	9,200
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	9,200
Transformation Plan | Global & Other Operating Segments
Restructuring Cost and Reserve [Line Items]
Charges incurred	0	$ 300	$ 13,400	$ 49,400	$ 16,800	$ 21,400
Charges incurred to-date	101,300
Estimated charges to be incurred on approved initiatives	0
Total expected charges on approved initiatives	$ 101,300

XML

GOODWILL (Schedule of Goodwill) (Details) $ in Millions	6 Months Ended
	Jun. 30, 2019 USD ($)
Goodwill [Roll Forward]
Net balance at beginning	$ 87.4
Foreign exchange	2.5
Net balance at ending	89.9
Europe, Middle East & Africa
Goodwill [Roll Forward]
Net balance at beginning	18.0
Foreign exchange	(0.3)
Net balance at ending	17.7
South Latin America
Goodwill [Roll Forward]
Net balance at beginning	66.8
Foreign exchange	2.8
Net balance at ending	69.6
Asia Pacific
Goodwill [Roll Forward]
Net balance at beginning	2.6
Foreign exchange	0.0
Net balance at ending	$ 2.6

XML

FAIR VALUE FAIR VALUE ASSETS AND LIABILITIES (Details) - Fair Value, Measurements, Recurring $ in Millions	Jun. 30, 2019 USD ($)
Assets:
Available-for-sale securities	$ 3.8
Foreign exchange forward contracts	1.2
Total Assets	5.0
Liabilities:
Foreign exchange forward contracts	10.9
Total Liabilities	10.9
Level 1
Assets:
Available-for-sale securities	3.8
Foreign exchange forward contracts	0.0
Total Assets	3.8
Liabilities:
Foreign exchange forward contracts	0.0
Total Liabilities	0.0
Level 2
Assets:
Available-for-sale securities	0.0
Foreign exchange forward contracts	1.2
Total Assets	1.2
Liabilities:
Foreign exchange forward contracts	10.9
Total Liabilities	$ 10.9

XML

FAIR VALUE (Fair Value of Financial Instruments) (Details) - USD ($) $ in Millions	Jun. 30, 2019	Dec. 31, 2018
Carrying Amount
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Available-for-sale securities	$ 3.8	$ 3.8
Debt maturing within one year	(398.5)	(12.0)
Long-term debt	(1,197.0)	(1,581.6)
Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Available-for-sale securities	3.8	3.8
Debt maturing within one year	(408.1)	(12.0)
Long-term debt	(1,254.0)	(1,460.2)
Foreign exchange forward contracts | Carrying Amount
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Foreign exchange forward contracts	(9.7)	(5.1)
Foreign exchange forward contracts | Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Foreign exchange forward contracts	$ (9.7)	$ (5.1)

XML

DERIVATIVE INSTRUMENTS FAIR VALUE (Details) - Fair Value, Measurements, Recurring $ in Millions	Jun. 30, 2019 USD ($)
Derivative [Line Items]
Foreign exchange forward contracts, asset	$ 1.2
Foreign exchange forward contracts, liability	10.9
Prepaid expenses and other | Designated as Hedging Instrument
Derivative [Line Items]
Foreign exchange forward contracts, asset	0.0
Prepaid expenses and other | Not Designated as Hedging Instrument
Derivative [Line Items]
Foreign exchange forward contracts, asset	1.2
Accounts payable | Designated as Hedging Instrument
Derivative [Line Items]
Foreign exchange forward contracts, liability	2.0
Accounts payable | Not Designated as Hedging Instrument
Derivative [Line Items]
Foreign exchange forward contracts, liability	$ 8.9

XML

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2019 USD ($)	Jun. 30, 2018 USD ($)	Jun. 30, 2019 USD ($)	Jun. 30, 2018 USD ($)	Dec. 31, 2018	Mar. 31, 2012 USD ($) derivative_instrument
Derivative [Line Items]
Total exposure to floating rate interest rates	25.00%		25.00%		1.00%
Foreign Exchange Contract
Derivative [Line Items]
Notional amounts of foreign currency exchange contracts	$ 1,192,500,000		$ 1,192,500,000
Gain (loss) on foreign currency derivative instruments not designated as hedging instruments	(3,100,000)	$ 1,700,000	21,900,000	$ 2,200,000
March 2012 Interest-Rate Swap Termination
Derivative [Line Items]
Number of interest-rate swap agreements terminated | derivative_instrument						2
Notional amount						$ 350,000,000
Deferred gain (loss) on discontinuation of interest rate fair value hedge						$ 46,100,000
Amortization of interest rate swap gains	0	$ 1,300,000	0	$ 6,000,000.0
Designated as Hedging Instrument | Foreign Exchange Contract
Derivative [Line Items]
Notional amounts of foreign currency exchange contracts	$ 19,500,000		$ 19,500,000

XML

DEBT (Details)	1 Months Ended			3 Months Ended		6 Months Ended
	Jul. 31, 2019 USD ($)	Feb. 28, 2019 EUR (€)	Jun. 30, 2015 USD ($)	Jun. 30, 2019 USD ($)	Mar. 31, 2019 USD ($)	Jun. 30, 2019 USD ($)	Jun. 30, 2019 EUR (€)	Aug. 31, 2016 USD ($)	Mar. 31, 2013 USD ($)
2015 Facility
Debt Instrument [Line Items]
Debt term			5 years
Line of credit facility			$ 400,000,000.0
Write off debt issuance costs					$ 2,000,000.0
2013 Notes
Debt Instrument [Line Items]
Increase in interest rate for every one-notch downgrade of long-term credit ratings below investment grade						0.25%
Maximum aggregate increase in interest rate related to downgrade of long-term credit ratings below investment grade						2.00%
Four Point Six Zero Percent Notes, Due February Two Thousand Twenty Two | 2019 Facility
Debt Instrument [Line Items]
Debt term		3 years
Line of credit facility		€ 200,000,000.0		$ 227,000,000.0		$ 227,000,000.0
Interest rate		4.60%
Issuance costs				$ 8,000,000	$ 10,000,000.0
Remaining borrowing capacity | €							€ 178,000,000.0
Four Point Six Zero Percent Notes, Due March Two Thousand Twenty
Debt Instrument [Line Items]
Interest rate				4.60%		4.60%	4.60%		4.60%
Principal amount				$ 386,900,000		$ 386,900,000			$ 500,000,000.0
Five Point Zero Percent Notes, Due March Two Thousand Twenty-Three
Debt Instrument [Line Items]
Interest rate									5.00%
Principal amount									$ 500,000,000.0
Six Point Nine Five Percent Notes, Due March Two Thousand Forty-Three
Debt Instrument [Line Items]
Interest rate									6.95%
Principal amount									$ 250,000,000.0
Seven Point Eight Seven Five Percent Notes, Due August Two Thousand Twenty Two
Debt Instrument [Line Items]
Interest rate								7.875%
Principal amount								$ 500,000,000.0
AIO
Debt Instrument [Line Items]
Standby letters of credit, recorded liability				$ 25,000,000.0		$ 25,000,000.0
Subsequent Event | 2019 Notes
Debt Instrument [Line Items]
Principal amount	$ 400,000,000.0
Subsequent Event | Four Point Six Zero Percent Notes, Due March Two Thousand Twenty
Debt Instrument [Line Items]
Interest rate	4.60%
Repayments of debt	$ 275,000,000

XML

INCOME TAXES (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Income Tax Disclosure [Abstract]
Effective income tax rate, excluding discrete items			26.00%	25.60%
Income taxes provision	$ 27.2	$ 36.7	$ 46.7	$ 68.2
Effective income tax rate	127.70%	(12233.30%)	278.00%	675.20%
Miscellaneous income tax expense	$ 0.6		$ 0.4
Change in income tax reserve (release)	$ 5.5		(3.3)	$ 14.7
Accrual of income tax benefits			$ 2.9

XML

AGREEMENT AND PLAN OF MERGERS WITH NATURA COSMETICOS S.A. (Details) - Merger Agreement $ in Millions	May 22, 2019	Jun. 30, 2019 USD ($)
Business Combination, Separately Recognized Transactions [Line Items]
Share conversion ratio	0.300
Transaction costs		$ 17
Expected transaction costs remaining		$ 33

XML

SUBSEQUENT EVENTS (Details) - USD ($)	1 Months Ended
	Jul. 31, 2019	Jun. 30, 2019	Mar. 31, 2013
Subsequent Event
Subsequent Event [Line Items]
Favorable tax ruling, credits involved	$ 117,000,000
Four Point Six Zero Percent Notes, Due March Two Thousand Twenty
Subsequent Event [Line Items]
Principal amount		$ 386,900,000	$ 500,000,000.0
Interest rate		4.60%	4.60%
Four Point Six Zero Percent Notes, Due March Two Thousand Twenty | Subsequent Event
Subsequent Event [Line Items]
Interest rate	4.60%
Repayments of debt	$ 275,000,000
2019 Notes | Subsequent Event
Subsequent Event [Line Items]
Principal amount	400,000,000.0
2019 Notes | Senior Notes | Subsequent Event
Subsequent Event [Line Items]
Principal amount	$ 400,000,000
Interest rate	6.50%

XML

Label	Element	Value
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ (41,100,000)
Retained Earnings, Appropriated [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ (41,100,000)