WRAPUP 2-Avon sales miss on weak North America, Arden beats
* Avon Q3 adj EPS $0.42 tops Street view of $0.40
* Avon North American rev down 8 pct; below some estimates
* Arden sales $265.2 mln tops Street view for $262.9 mln
* Avon shares down 1.6 pct; Arden up slightly
* Revlon shares soar 34 pct after reporting profit (Adds Avon comments, analysts, details on Revlon, Allergan)
NEW YORK, Oct 29 (Reuters) - Cosmetic maker Avon Products Inc (AVP.N) warned investors that demand remains weak in North America while Elizabeth Arden Inc (RDEN.O) benefited from consumers picking up perfumes at duty-free shops.
Avon, the world's largest direct seller of cosmetics, reported third-quarter revenue that fell short of analysts' estimates, hurt by worse-than-expected revenue in North America, and its shares fell as much as 8.7 percent. [ID:nN29260358]
Elizabeth Arden posted an unexpected quarterly profit and sales that beat estimates, aided by improving trends in its travel retail business, which includes duty-free shops. Its shares rose as much as 10 percent. [ID:nN29260659]
"There are signs that economic conditions are beginning to improve, and, while early, we are expecting good performance from our new launches for the holiday season," said E. Scott Beattie, Arden's chief executive.
The company's retail customers have not yet returned to a normal pattern of ordering replenishment stock, he said, which suggests consumers are still spending cautiously.
Avon, which operates through a network of representatives, said revenue fell 8 percent in North America, worse than BMO Capital Markets analyst Connie Maneaty's expectation for a 2 percent decline.
"North American weakness was a surprise," Maneaty said. "We note, however, that the region does not determine overall EPS growth and we expect it to firm up over time."
Arden also sells Prevage anti-aging cream, which it created in alliance with Botox-maker Allergan Inc (AGN.N). Allergan posted higher quarterly profit on Thursday, as sales of the anti-wrinkle drug rose. [nN28494607]
Cosmetics maker maker Revlon Inc (REV.N) also reported financial results on Thursday, posting a profit on sales that declined less than expected, and its shares soared 34 percent [ID:nBNG210958].
ARDEN'S LEVERAGE, AVON'S STRATEGY Continued...
