10-Q

UNITED STATES OF AMERICA

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________________

FORM 10-Q

_________________________

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

For the quarterly period ended June 30, 2016

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.)

777 Third Avenue, New York, N.Y. 10017-1307

(Address of principal executive offices) (Zip code)

(212) 282-5000

(Telephone Number, including area code)

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, 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 and post such files).    Yes  x    No  ¨

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

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨  (do not check if a smaller reporting company)	Smaller reporting company	¨

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

The number of shares of Common Stock (par value $0.25) outstanding at June 30, 2016 was 437,019,165.

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, 2016 and June 30, 2015	3 - 4
	Consolidated Statements of Comprehensive Income (Loss) Three and Six Months Ended June 30, 2016 and June 30, 2015	5 - 6
	Consolidated Balance Sheets June 30, 2016 and December 31, 2015	7
	Consolidated Statements of Cash Flows Six Months Ended June 30, 2016 and June 30, 2015	8 - 9
	Notes to Consolidated Financial Statements	10 - 28
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	29 - 49
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	50
Item 4.	Controls and Procedures	50
Part II. Other Information
Item 1.	Legal Proceedings	51
Item 1A.	Risk Factors	51
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	51
Item 6.	Exhibits	51
	Signature	52

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, 2016			June 30, 2015
Net sales	$	1,399.5		$	1,544.5
Other revenue	34.8			20.4
Total revenue	1,434.3			1,564.9
Costs, expenses and other:
Cost of sales	565.0			611.0
Selling, general and administrative expenses	774.2			864.2
Operating profit	95.1			89.7
Interest expense	33.2			30.5
Interest income	(5.3		)	(3.1		)
Other (income) expense, net	(4.7		)	1.1
Total other expenses	23.2			28.5
Income before taxes	71.9			61.2
Income taxes	(36.1		)	(32.3		)
Income from continuing operations, net of tax	35.8			28.9
(Loss) income from discontinued operations, net of tax	(2.6		)	0.8
Net income	33.2			29.7
Net income attributable to noncontrolling interests	(0.2		)	(0.9		)
Net income attributable to Avon	$	33.0		$	28.8
Earnings (loss) per share:
Basic from continuing operations	$	0.07		$	0.06
Basic from discontinued operations	(0.01		)	—
Basic attributable to Avon	0.06			0.07
Diluted from continuing operations	$	0.07		$	0.06
Diluted from discontinued operations	(0.01		)	—
Diluted attributable to Avon	0.06			0.07
Cash dividends per common share	$	—		$	0.06

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, 2016			June 30, 2015
Net sales	$	2,679.5		$	3,077.4
Other revenue	61.3			39.6
Total revenue	2,740.8			3,117.0
Costs, expenses and other:
Cost of sales	1,083.8			1,222.7
Selling, general and administrative expenses	1,554.1			1,837.5
Operating profit	102.9			56.8
Interest expense	65.9			58.6
Interest income	(9.3		)	(6.1		)
Other expense, net	132.5			19.8
Total other expenses	189.1			72.3
Loss before taxes	(86.2		)	(15.5		)
Income taxes	(33.8		)	(98.2		)
Loss from continuing operations, net of tax	(120.0		)	(113.7		)
Loss from discontinued operations, net of tax	(12.2		)	(3.0		)
Net loss	(132.2		)	(116.7		)
Net income attributable to noncontrolling interests	(0.7		)	(1.8		)
Net loss attributable to Avon	$	(132.9	)	$	(118.5	)
Loss per share:
Basic from continuing operations	$	(0.29	)	$	(0.26	)
Basic from discontinued operations	(0.03		)	(0.01		)
Basic attributable to Avon	(0.32		)	(0.27		)
Diluted from continuing operations	$	(0.29	)	$	(0.26	)
Diluted from discontinued operations	(0.03		)	(0.01		)
Diluted attributable to Avon	(0.32		)	(0.27		)
Cash dividends per common share	$	—		$	0.12

The accompanying notes are an integral part of these statements.

4

AVON PRODUCTS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

	Three Months Ended
(In millions)	June 30, 2016			June 30, 2015
Net income	$	33.2		$	29.7
Other comprehensive (loss) income:
Foreign currency translation adjustments	(8.1		)	21.1
Change in derivative losses on cash flow hedges, net of taxes of $0.0 and $0.0	0.5			0.5
Adjustments of and amortization of net actuarial loss and prior service cost, net of taxes of $0.2 and $0.3	4.2			13.3
Total other comprehensive (loss) income, net of taxes	(3.4		)	34.9
Comprehensive income	29.8			64.6
Less: comprehensive loss attributable to noncontrolling interests	(0.9		)	(0.5		)
Comprehensive income attributable to Avon	$	30.7		$	65.1

The accompanying notes are an integral part of these statements.

5

AVON PRODUCTS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

	Six Months Ended
(In millions)	June 30, 2016				June 30, 2015
Net loss	$	(132.2	)	352.3	$	(116.7	)
Other comprehensive income (loss):
Foreign currency translation adjustments	87.8				(105.5		)
Change in derivative losses on cash flow hedges, net of taxes of $0.0 and $0.0	0.9				0.9
Adjustments of and amortization of net actuarial loss and prior service cost, net of taxes of $10.6 and $0.6	268.2				23.0
Total other comprehensive income (loss), net of taxes	356.9				(81.6		)
Comprehensive income (loss)	224.7				(198.3		)
Less: comprehensive income (loss) attributable to noncontrolling interests	0.2				(0.1		)
Comprehensive income (loss) attributable to Avon	$	224.5			$	(198.2	)

The accompanying notes are an integral part of these statements.

6

AVON PRODUCTS, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In millions)	June 30, 2016			December 31, 2015
Assets
Current Assets
Cash and cash equivalents	$	741.5		$	686.9
Accounts receivable, net	466.2			443.0
Inventories	665.5			624.0
Prepaid expenses and other	314.0			296.1
Current assets of discontinued operations	7.0			291.1
Total current assets	2,194.2			2,341.1
Property, plant and equipment, at cost	1,507.6			1,495.7
Less accumulated depreciation	(764.3		)	(728.8		)
Property, plant and equipment, net	743.3			766.9
Goodwill	96.1			92.3
Other assets	604.5			490.0
Noncurrent assets of discontinued operations	—			180.1
Total assets	$	3,638.1		$	3,870.4
Liabilities and Shareholders’ Deficit
Current Liabilities
Debt maturing within one year	$	48.8		$	55.2
Accounts payable	723.7			774.2
Accrued compensation	138.8			157.6
Other accrued liabilities	417.9			419.6
Sales and taxes other than income	144.3			174.9
Income taxes	6.6			23.9
Payable to discontinued operations	—			100.0
Current liabilities of discontinued operations	12.0			489.7
Total current liabilities	1,492.1			2,195.1
Long-term debt	2,139.6			2,150.5
Employee benefit plans	164.9			177.5
Long-term income taxes	76.7			65.1
Other liabilities	162.1			78.4
Noncurrent liabilities of discontinued operations	—			260.2
Total liabilities	4,035.4			4,926.8
Commitments and contingencies (Note 8)
Series C convertible preferred stock	433.6			—
Shareholders’ Deficit
Common stock	188.5			187.9
Additional paid-in capital	2,266.1			2,254.0
Retained earnings	2,308.0			2,448.1
Accumulated other comprehensive loss	(1,009.8		)	(1,366.2		)
Treasury stock, at cost	(4,597.8		)	(4,594.1		)
Total Avon shareholders’ deficit	(845.0		)	(1,070.3		)
Noncontrolling interests	14.1			13.9
Total shareholders’ deficit	(830.9		)	(1,056.4		)
Total liabilities, series C convertible preferred stock and shareholders’ deficit	$	3,638.1		$	3,870.4

The accompanying notes are an integral part of these statements.

7

AVON PRODUCTS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Six Months Ended
(In millions)	June 30, 2016			June 30, 2015
Cash Flows from Operating Activities
Net loss	$	(132.2	)	$	(116.7	)
Loss from discontinued operations, net of tax	12.2			3.0
Loss from continuing operations, net of tax	$	(120.0	)	$	(113.7	)
Adjustments to reconcile net loss to net cash used by operating activities:
Depreciation	41.7			49.7
Amortization	14.7			17.4
Provision for doubtful accounts	73.8			68.1
Provision for obsolescence	18.5			22.7
Share-based compensation	16.0			11.9
Foreign exchange losses	—			6.1
Deferred income taxes	(15.0		)	29.2
Charge for Venezuelan monetary assets and liabilities	—			(4.2		)
Charge for Venezuelan non-monetary assets	—			101.7
Loss on deconsolidation of Venezuela	120.5			—
Other	1.7			3.7
Changes in assets and liabilities:
Accounts receivable	(90.4		)	(80.1		)
Inventories	(69.6		)	(70.5		)
Prepaid expenses and other	2.3			(51.4		)
Accounts payable and accrued liabilities	(65.5		)	(42.8		)
Income and other taxes	(24.2		)	(25.5		)
Noncurrent assets and liabilities	(34.7		)	(29.2		)
Net cash used by operating activities of continuing operations	(130.2		)	(106.9		)
Cash Flows from Investing Activities
Capital expenditures	(42.7		)	(40.4		)
Disposal of assets	1.9			4.3
Purchases of investments	—			(11.9		)
Net proceeds from sale of investments	—			0.6
Reduction of cash due to Venezuela deconsolidation	(4.5		)	—
Other investing activities	1.6			—
Net cash used by investing activities of continuing operations	(43.7		)	(47.4		)
Cash Flows from Financing Activities
Cash dividends	—			(53.6		)
Debt, net (maturities of three months or less)	(11.6		)	(0.3		)
Proceeds from debt	8.8			7.6
Repayment of debt	(6.2		)	(4.4		)
Repurchase of common stock	(3.7		)	(2.5		)
Net proceeds from the sale of series C convertible preferred stock	426.3			—
Other financing activities	(1.0		)	(5.8		)
Net cash provided (used) by financing activities of continuing operations	412.6			(59.0		)
Net cash used by operating activities of discontinued operations	(65.9		)	(3.0		)
Net cash used by investing activities of discontinued operations	(96.7		)	(1.7		)
Net cash used by financing activities of discontinued operations	—			(10.1		)
Net cash used by discontinued operations	(162.6		)	(14.8		)
Effect of exchange rate changes on cash and cash equivalents	(19.3		)	(29.4		)
Net increase (decrease) in cash and cash equivalents	56.8			(257.5		)
Cash and cash equivalents at beginning of year(1)	684.7			960.5
Cash and cash equivalents at end of period(2)	$	741.5		$	703.0

The accompanying notes are an integral part of these statements.

8

AVON PRODUCTS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(1) Includes cash and cash equivalents of discontinued operations of $(2.2) and $24.1 at the beginning of the year in 2016 and 2015, respectively.

(2) Includes cash and cash equivalents of discontinued operations of $1.0 and cash and cash equivalents held for sale of $6.1 at June 30, 2015.

9

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

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 2015 Annual Report on Form 10-K ("2015 Form 10-K") in preparing these unaudited financial statements. In our opinion, the unaudited interim consolidated financial statements reflect all adjustments of a normal recurring nature that are necessary for a fair statement of the results for the interim periods presented. Results for interim periods are not necessarily indicative of results for a full year. You should read these unaudited interim consolidated financial statements in conjunction with our consolidated financial statements contained in our 2015 Form 10-K. When used in this report, the terms "Avon," "Company," "we" or "us" mean Avon Products, Inc.

For interim consolidated financial statement purposes we provide for accruals under our various employee benefit plans for each quarter based on one quarter of the estimated annual expense. In addition, our tax provision is determined using an estimate of our consolidated annual effective tax rate, adjusted in the current period for discrete tax items including:

• the effects of significant, unusual or extraordinary pretax and tax items, if any;

• withholding taxes associated with current period cash repatriations; and

• the impact of loss-making subsidiaries for which we cannot recognize a tax benefit and subsidiaries that reduce the reliability of the estimated annual consolidated effective tax rate.

Venezuela

Venezuela's restrictive foreign exchange control regulations and our Venezuelan operations' increasingly limited access to U.S. dollars have resulted in an other-than-temporary lack of exchangeability between the Venezuelan bolivar and the U.S. dollar, and have restricted our Venezuelan operations' ability to pay dividends and settle intercompany obligations. The severe currency controls imposed by the Venezuelan government have significantly limited our ability to realize the benefits from earnings of our Venezuelan operations and access the resulting liquidity provided by those earnings. We expected that this other-than-temporary lack of exchangeability would continue for the foreseeable future, and as a result, we concluded that, effective March 31, 2016, we did not meet the accounting criteria of control in order to continue consolidating our Venezuelan operations and, as a result, account for our Venezuelan operations using the cost method of accounting. Our Consolidated Balance Sheets no longer includes the assets and liabilities of our Venezuelan operations and we no longer include the results of our Venezuelan operations in our Consolidated Financial Statements.

As a result of the change to the cost method of accounting, in the first quarter of 2016, we recorded a loss of approximately $120 in other expense, net. The loss was comprised of approximately $39 in net assets of the Venezuelan business and approximately $81 in accumulated foreign currency translation adjustments within AOCI (shareholders' deficit) associated with foreign currency changes before Venezuela was accounted for as a highly inflationary economy. The nets assets of the Venezuelan business were comprised of inventories of approximately $24, property, plant and equipment, net of approximately $15, other assets of approximately $11, cash of approximately $5, accounts receivable of approximately $4, and accounts payable and accrued liabilities of approximately $20.

In February 2015, the Venezuelan government announced the creation of a new foreign exchange system referred to as the SIMADI exchange ("SIMADI"). SIMADI began operating on February 12, 2015. There were multiple legal mechanisms in Venezuela to exchange currency. As SIMADI represented the rate which better reflected the economics of Avon Venezuela's business activity, in comparison to the other available exchange rates, we concluded that we should utilize the SIMADI exchange rate to remeasure our Venezuelan operations effective February 12, 2015. As a result of the change to the SIMADI rate, which caused the recognition of a devaluation of approximately 70% as compared to the exchange rate we had used previously, we recorded an after-tax benefit of approximately $3 (a benefit of approximately $4 in other expense, net, and a loss of approximately $1 in income taxes) in the first quarter of 2015, primarily reflecting the write-down of net monetary assets. In addition, as a result of using the historical U.S. dollar cost basis of non-monetary assets, such as inventories, these assets continued to be remeasured, following the change to the SIMADI rate, at the applicable rate at the time of their acquisition. The remeasurement of non-monetary assets at the historical U.S. dollar cost basis caused a disproportionate expense as these assets were consumed in operations, negatively impacting operating profit and net income by approximately $11 during the six months ended June 30, 2015. Also as a result of the change to the SIMADI rate, we determined that an adjustment of

10

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

approximately $11 to cost of sales was needed to reflect certain non-monetary assets, primarily inventories, at their net realizable value, which was recorded in the first quarter of 2015.

In addition, at February 12, 2015, we reviewed Avon Venezuela's long-lived assets to determine whether the carrying amount of the assets was recoverable. Based on our expected cash flows associated with the asset group, we determined that the carrying amount of the assets, carried at their historical U.S. dollar cost basis, was not recoverable. As such, an impairment charge of approximately $90 to selling, general and administrative expenses was needed to reflect the write-down of the long-lived assets to their estimated fair value of $15.7, which was recorded in the first quarter of 2015. The fair value of Avon Venezuela's long-lived assets was determined using both market and cost valuation approaches. The valuation analysis performed required several estimates, including market conditions and inflation rates.

Accounting Standards Implemented

In April 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-03, Interest-Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs, which requires debt issuance costs to be presented in the balance sheet as a direct reduction from the associated debt liability rather than as an asset. We adopted this standard for the first fiscal quarter of 2016 and applied it retrospectively to all periods presented. Accordingly, $9.1 of debt issuance costs are reflected within long-term debt as of December 31, 2015. These costs were previously recorded within other assets.

Accounting Standards to be Implemented

In February 2016, the FASB issued ASU 2016-02, Leases, which requires all assets and liabilities arising from leases to be recognized in the statement of financial position. This standard is effective as of January 1, 2019. We are currently evaluating the effect that adopting this new accounting guidance will have on our consolidated financial statements.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, issued as a new Topic, Accounting Standards Codification Topic 606. The core principle of the guidance is that a Company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14, Deferral of the Effective Date, which resulted in the standard being effective beginning in 2018, with early adoption permitted in the beginning of 2017. This standard has been amended, and as amended, can be adopted either retrospectively or as a cumulative-effect adjustment as of the date of adoption. We are currently evaluating the effect that adopting this new accounting guidance will have on our consolidated financial statements.

2. EARNINGS (LOSS) PER SHARE AND SHARE REPURCHASES

We compute earnings (loss) per share ("EPS") using the two-class method, which is an earnings (loss) allocation formula that determines earnings (loss) per share for common stock, and earnings (loss) allocated to convertible preferred stock and participating securities, as appropriate. The earnings allocated to convertible preferred stock are the larger of the preferred dividends accrued in the period or the percentage of earnings 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.

11

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,
(Shares in millions)	2016			2015			2016			2015
Numerator from continuing operations:
Income (loss) from continuing operations, less amounts attributable to noncontrolling interests	$	35.6		$	28.0		$	(120.7	)	$	(115.5	)
Less: (Earnings) loss allocated to participating securities	(.5		)	(.1		)	1.7			2.3
Less: Earnings allocated to convertible preferred stock	(5.9		)	—			(7.3		)	—
Income (loss) from continuing operations allocated to common shareholders	29.2			27.9			(126.3		)	(113.2		)
Numerator from discontinued operations:
(Loss) income from discontinued operations	$	(2.6	)	$	.8		$	(12.2	)	$	(3.0	)
Less: Loss allocated to participating securities	—			.4			.2			.7
(Loss) income allocated to common shareholders	(2.6		)	1.2			(12.0		)	(2.3		)
Numerator attributable to Avon:
Net income (loss) attributable to Avon	$	33.0		$	28.8		$	(132.9	)	$	(118.5	)
Less: (Earnings) loss allocated to participating securities	(.4		)	(.1		)	1.8			2.3
Less: Earnings allocated to convertible preferred stock	(5.9		)	—			(7.3		)	—
Income (loss) allocated to common shareholders	26.7			28.7			(138.4		)	(116.2		)
Denominator:
Basic EPS weighted-average shares outstanding	436.9			435.2			436.4			435.0
Diluted effect of assumed conversion of stock options	—			—			—			—
Diluted effect of assumed conversion of preferred stock	—			—			—			—
Diluted EPS adjusted weighted-average shares outstanding	436.9			435.2			436.4			435.0
Earnings (Loss) per Common Share from continuing operations:
Basic	$	.07		$	.06		$	(.29	)	$	(.26	)
Diluted	.07			.06			(.29		)	(.26		)
Loss per Common Share from discontinued operations:
Basic	$	(.01	)	$	—		$	(.03	)	$	(.01	)
Diluted	(.01		)	—			(.03		)	(.01		)
Earnings (Loss) per Common Share attributable to Avon:
Basic	$	.06		$	.07		$	(.32	)	$	(.27	)
Diluted	.06			.07			(.32		)	(.27		)

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

During the three months ended June 30, 2016 and 2015, we did not include stock options to purchase 15.2 million shares and 12.2 million shares, respectively, of Avon common stock in the calculation of diluted EPS because the exercise prices of those options were greater than the average market price, and therefore, their inclusion would be anti-dilutive. During the six months ended June 30, 2016 and 2015, we did not include stock options to purchase 13.8 million shares and 13.9 million shares, respectively, of Avon common stock in the calculation of diluted EPS as we had a loss from continuing operations, net of tax. The inclusion of these shares would decrease the net loss per share, and therefore, their inclusion would be anti-dilutive.

For the three and six months ended June 30, 2016, it is more dilutive to assume the Series C Convertible Preferred Stock is not converted into common stock and therefore the weighted-average outstanding shares outstanding was not adjusted by the as-if converted Series C Convertible Preferred Stock because the effect would decrease the net loss per share, and therefore, their inclusion would be anti-dilutive. 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, 2016. See Note 7, Series C Convertible Preferred Stock.

12

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

We purchased approximately .9 million shares of Avon common stock for $3.7 during the first six months of 2016, as compared to approximately .3 million shares of Avon common stock for $2.5 during the first six months of 2015, through acquisition of stock from employees in connection with tax payments upon vesting of restricted stock units.

3. 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 investment by Cleveland Apple Investor L.P. (f/k/a Cleveland Apple Investor LLC) (“Cerberus Investor”) (an affiliate of Cerberus) in the Company through the purchase of perpetual convertible preferred stock (see Note 7, Series C Convertible Preferred Stock) 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 Cleveland NA Investor LLC (“Cerberus NA”) (an affiliate of Cerberus). These transactions closed on March 1, 2016.

Cerberus NA contributed $170 of cash into New Avon in exchange for 80.1% of its ownership interests. The Company contributed the North America business, certain pension and postretirement liabilities and $100 of cash into New Avon in exchange for a 19.9% ownership interest of New Avon. The Company received $4 of cash from New Avon at closing as part of an estimate of a customary working capital adjustment.

During the fourth quarter of 2015, the Company recorded an estimated loss on sale of discontinued operations of approximately $340 before tax (approximately $340 after tax) as the carrying value exceeded the estimated fair value less costs to sell. During the three and six months ended June 30, 2016, the Company recognized additional losses on sale of approximately $1 before tax (approximately $1 after tax) and approximately $16 before tax (approximately $6 after tax), respectively. The loss on sale represented the net assets contributed into New Avon, including certain pension and postretirement benefit plan liabilities and amounts in AOCI associated with the North America business, which were primarily unrecognized losses associated with our U.S. defined benefit pension plan, and costs to sell, as compared to the implied value of our ownership interests in New Avon which was approximately $43. The ultimate loss on sale will be dependent on the finalization of the amount of pension and postretirement benefit plan liabilities contributed to New Avon and the finalization of customary working capital settlement, which are expected to be finalized in the second half of 2016.

New Avon entered into a perpetual, irrevocable royalty-free licensing agreement with the Company for the use of the Avon brand and certain other intellectual property. Avon and New Avon also entered into a transition services agreement which covers, among other things, information technology, financial services and human resources, as well as other commercial agreements, including for research and development and product supply. In addition, the Company subleases office space to New Avon. See Note 4, Related Party Transactions.

The Company accounts for its ownership interests in New Avon using the equity method of accounting, which results in the Company recognizing its proportionate share of New Avon's income or loss. The Company's proportionate share of the post-separation losses of New Avon was $.6 and $4.5 during the three and six months ended June 30, 2016, respectively, and was recorded within other expense, net.

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

	Three Months Ended June 30,						Six Months Ended June 30,
	2016			2015			2016			2015
Total revenue	$	—		$	258.5		$	135.2		$	500.6
Cost of sales	—			102.4			53.2			197.9
Selling, general and administrative expenses	1.2			154.0			89.0			305.3
Operating (loss) profit	(1.2		)	2.1			(7.0		)	(2.6		)
Other (expense) income items	—			(.2		)	.6			(1.4		)
Loss on sale of discontinued operations, before tax	(1.4		)	—			(16.3		)	—
(Loss) income from discontinued operations, before tax	(2.6		)	1.9			(22.7		)	(4.0		)
Income taxes	—			(1.1		)	10.5			1.0
(Loss) income from discontinued operations, net of tax	$	(2.6	)	$	.8		$	(12.2	)	$	(3.0	)

13

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

4. RELATED PARTY TRANSACTIONS

As discussed in Note 3, Discontinued Operations, the Company has entered into a transition services agreement to provide certain services to New Avon, as well as an agreement for research and development and subleases for office space. In addition, New Avon is performing certain services for the Company under a similar transition services agreement. The Company recorded a net $11.0 and $14.9 reduction of selling, general and administrative expenses associated with these agreements during the three and six months ended June 30, 2016, respectively.

The Company also supplies product to New Avon as part of these transition services. The Company recorded revenues of $9.8 and $13.5 and gross profit of $.4 and $.9 associated with this supply arrangement during the three and six months ended June 30, 2016, respectively. In addition, New Avon also supplies product to the Company as part of these transition services. The Company purchased $2.4 and $3.6 from New Avon associated with this supply arrangement during the three and six months ended June 30, 2016, respectively.

The Company also entered into agreements with an affiliate of Cerberus, which provide for the secondment of Cerberus affiliate personnel to the Company's project management team responsible for assisting with the execution of the transformation plan (the "Transformation Plan") announced in January 2016. The Company recorded $1.0 and $1.0 in selling, general and administrative expenses associated with these agreements during the three and six months ended June 30, 2016, respectively. See Note 12, Restructuring Initiatives for additional information related to the Transformation Plan.

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, 2016 the Company has accrued $2.1 for the estimated value of such standby letters of credit. The recognition of the liability was included in the estimated loss on sale of the North America business in loss from discontinued operations, net of tax.

See Note 7, Series C Convertible Preferred Stock, for discussion of preferred shares issued to Cerberus Investor.

5. INVENTORIES

Components of Inventories	June 30, 2016		December 31, 2015
Raw materials	$	206.6	$	180.5
Finished goods	458.9		443.5
Total	$	665.5	$	624.0

6. EMPLOYEE BENEFIT PLANS

	Three Months Ended June 30,
	Pension Benefits
Net Periodic Benefit Costs	U.S. Plans						Non-U.S. Plans						Postretirement Benefits
	2016			2015			2016			2015			2016			2015
Service cost	$	1.3		$	2.9		$	1.3		$	1.4		$	—		$	.1
Interest cost	.8			6.2			5.7			5.7			.3			.9
Expected return on plan assets	(1.0		)	(8.3		)	(8.7		)	(9.1		)	—			—
Amortization of prior service credit	—			(.2		)	—			—			—			(1.0		)
Amortization of net actuarial losses	1.6			11.5			1.7			2.1			(.1		)	.5
Settlements/curtailments	—			—			—			—			—			—
Net periodic benefit costs(1)	$	2.7		$	12.1		$	—		$	.1		$	.2		$	.5

14

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

	Six Months Ended June 30,
	Pension Benefits
Net Periodic Benefit Costs	U.S. Plans						Non-U.S. Plans						Postretirement Benefits
	2016			2015			2016			2015			2016			2015
Service cost	$	3.6		$	6.5		$	2.6		$	2.9		$	.1		$	.3
Interest cost	5.1			12.5			11.7			11.6			.9			1.8
Expected return on plan assets	(6.2		)	(16.6		)	(17.5		)	(18.2		)	—			—
Amortization of prior service credit	(.1		)	(.4		)	—			—			(.9		)	(2.0		)
Amortization of net actuarial losses	7.7			23.1			3.4			4.2			.1			1.0
Settlements/curtailments	.1			—			—			—			—			—
Net periodic benefit costs(1)	$	10.2		$	25.1		$	.2		$	.5		$	.2		$	1.1

⁽¹⁾ Includes $8.3 of U.S. pension for the three months ended June 30, 2015 and $4.4 and $17.2 of U.S. pension for the six months ended June 30, 2016 and 2015, respectively. Immaterial amounts of the postretirement benefit plans (related to the U.S.) are included in discontinued operations for the three months ended June 30, 2015 and for the six months ended June 30, 2016 and 2015. Amounts associated with the pension and postretirement benefit plans in Canada and the postretirement benefit plan in Puerto Rico, which are included in discontinued operations, have been excluded from all amounts in the tables above.

As part of the separation of the North America business, we transferred an initial estimate of $499.6 of pension liabilities under the U.S. defined benefit pension plan associated with current and former employees of the North America business and certain other former Avon employees, along with $358.0 of assets held by the U.S. defined benefit pension plan, to a defined benefit pension plan sponsored by New Avon. We also transferred an initial estimate of $60.4 of other postretirement liabilities (namely, retiree medical and supplemental pension liabilities) in respect of such employees and former employees. See Note 3, Discontinued Operations. We continue to retain certain U.S. pension and other postretirement liabilities primarily associated with employees who are actively employed by Avon outside of the North America business.

During the six months ended June 30, 2016, we made approximately $26 and $10 of contributions to the U.S. and non-U.S. defined benefit pension and postretirement benefit plans, respectively. During the remainder of 2016, we anticipate contributing approximately $1 and $10 to $15 to fund our U.S. and non-U.S. defined benefit pension and postretirement benefit plans, respectively.

7. SERIES C CONVERTIBLE PREFERRED STOCK

On March 1, 2016, we issued and sold to Cerberus Investor 435,000 shares of newly issued Series C Preferred Stock for an aggregate purchase price of $435.0 pursuant to an Investment Agreement, dated as of December 17, 2015, between the Company and Cerberus Investor. In connection with the issuance of the Series C Preferred Stock, the Company incurred direct and incremental expenses of $8.7, comprised of financial advisory fees and legal expenses, which reduced the carrying value of the Series C Preferred Stock. The Series C Preferred Stock has accrued dividends daily since March 1, 2016 at a rate of 1.25% per quarter, and as of June 30, 2016, had accrued unpaid dividends of $7.3. There were no cash dividends declared in the six months ended June 30, 2016.

Dividend Rights. The Series C Preferred Stock ranks senior to the shares of our common stock with respect to dividend rights and rights on the distribution of assets on any liquidation, dissolution or winding up of our affairs. The Series C Preferred Stock has a liquidation preference of $1,000 per share, representing an aggregate liquidation preference of $435.0 upon issuance. Holders of Series C Preferred Stock are entitled to participate on an as-converted basis in any cash dividends paid to the holders of shares of the Company’s common stock. In addition, cumulative preferred dividends accrue daily on the Series C Preferred Stock and are payable at a rate of 1.25% per quarter (net of any dividends on the Company’s common stock and subject to increase up to a maximum rate of 5.00% per quarter if the Company breaches certain obligations). Except to the extent not otherwise previously paid by the Company, preferred dividends are payable on the seventh anniversary of the issuance date of the Series C Preferred Stock as and when declared by the Board of Directors and at the end of each quarter thereafter. Accrued and unpaid preferred dividends may be paid, at the Company’s option, (i) in cash, (ii) subject to certain conditions, in shares of the Company’s common stock or (iii) upon conversion of shares of Series C Preferred Stock, in shares of the Company’s non-voting, non-convertible Series D Preferred Stock. Any such shares of Series D Preferred Stock issued would have similar preferential rights.

Conversion Features. Series C Preferred Stock is convertible at the option of the holders at any time into shares of the Company’s common stock at an initial conversion price of $5.00 per share, subject to certain anti-dilution adjustments. Prior to receipt of applicable shareholder approval, shares of Series C Preferred Stock are not convertible into more than 19.99% of the

15

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

number of shares of common stock outstanding immediately prior to the issuance of the Series C Preferred Stock, subject to certain anti-dilution adjustments. As of June 30, 2016, Series C Preferred Stock was convertible into 87,051,524 shares of common stock. If at any time the volume weighted average price of the common stock exceeds $10.00 per share (subject to certain anti-dilution adjustments) for a period of 30 consecutive trading days, the Company may cause all of the Series C Preferred Stock to be converted into shares of common stock based on the then applicable conversion price.

Voting Rights. Holders of Series C Preferred Stock are entitled to vote generally with the holders of common stock on an as-converted basis. Holders of Series C Preferred Stock are also entitled to a separate class vote with respect to (i) the election of up to three directors to the Board of Directors, subject to maintaining certain levels of beneficial ownership of Series C Preferred Stock and/or common stock, (ii) amendments to the Company’s organizational documents that have an adverse effect on the Series C Preferred Stock, (iii) issuances by the Company of securities that are senior to, or equal in priority with, the Series C Preferred Stock or (iv) the delisting of the Company’s common stock, other than in connection with a change of control event.

Change of Control Put. Upon certain change of control events involving the Company, holders of Series C Preferred Stock can require the Company to repurchase the Series C Preferred Stock for an amount equal to the greater of (i) an amount in cash equal to 100% of the liquidation preference thereof plus all accrued but unpaid dividends or (ii) the consideration the holders would have received if they had converted their shares of Series C Preferred Stock into common stock immediately prior to the change of control event.

8. CONTINGENCIES

Settlements of FCPA Investigations

As previously reported, we engaged outside counsel to conduct an internal investigation and compliance reviews focused on compliance with the Foreign Corrupt Practices Act ("FCPA") and related U.S. and foreign laws in China and additional countries. The internal investigation, which was conducted under the oversight of our Audit Committee, began in June 2008 and along with the compliance reviews, was completed in 2014.

Following our voluntary reporting of the internal investigation to both the U.S. Department of Justice (the “DOJ”) and the U.S. Securities and Exchange Commission (the “SEC”) and our subsequent cooperation with those agencies, the United States District Court for the Southern District of New York (the "USDC") approved in December 2014 a deferred prosecution agreement (“DPA”) entered into between the Company and the DOJ related to charges of violations of the books and records and internal controls provisions of the FCPA. In addition, Avon Products (China) Co. Ltd., a subsidiary of the Company operating in China, pleaded guilty to conspiring to violate the books and records provision of the FCPA and was sentenced by the USDC to pay a $68 fine. The SEC also filed a complaint against the Company charging violations of the books and records and internal controls provisions of the FCPA and the Consent which was approved in a judgment entered by the USDC in January 2015, and included $67 in disgorgement and prejudgment interest. The DPA, the above-mentioned guilty plea and the Consent resolved the SEC’s and the DOJ’s investigations of the Company’s compliance with the FCPA and related U.S. laws in China and additional countries. The fine was paid in December 2014 and the payment to the SEC was made in January 2015.

Under the DPA, the DOJ will defer criminal prosecution of the Company for a term of three years. If the Company remains in compliance with the DPA during its term, the charges against the Company will be dismissed with prejudice. Under the DPA, the Company also represented that it has implemented and agreed that it will continue to implement a compliance and ethics program designed to prevent and detect violations of the FCPA and other applicable anti-corruption laws throughout its operations.

Under the DPA and the Consent, among other things, the Company agreed to have a compliance monitor (the "monitor"). During July 2015, the Company engaged a monitor, who had been approved by the DOJ and SEC. With the approval of the DOJ and the SEC, the monitor can be replaced by the Company after 18 months, if the Company agrees to undertake self-reporting obligations for the remainder of the monitoring period. The monitoring period is scheduled to expire in July 2018. There can be no assurance as to whether or when the DOJ and the SEC will approve replacing the monitor with the Company’s self-reporting. If the DOJ determines that the Company has knowingly violated the DPA, the DOJ may commence prosecution or extend the term of the DPA, including the monitoring provisions described above, for up to one year.

The monitor is assessing and monitoring the Company's compliance with the terms of the DPA and the Consent by evaluating, among other things, the Company's internal accounting controls, recordkeeping and financial reporting policies and procedures. The monitor has recommended some changes to our policies and procedures that we are in the process of adopting, and may make additional recommendations that we must adopt unless they are unduly burdensome or otherwise inadvisable, in which case we may propose alternatives, which the DOJ and the SEC may or may not accept. In addition, operating under the oversight of the monitor may result in additional time and attention on these matters by members of our management, which

16

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

may divert their time from the operation of our business. Assuming the monitor is replaced by a self-reporting period, the Company’s self-reporting obligations may be costly or time-consuming.

The costs incurred in connection with ongoing compliance with the DPA and the Consent, including the monitorship, have not been material to date and we do not anticipate material costs going forward. We currently cannot estimate the costs that we are likely to incur in connection with self-reporting, if applicable, and any additional costs of implementing the changes, if any, to our policies and procedures required by the monitor.

Litigation Matters

In July and August 2010, derivative actions were filed in state court against certain present or former officers and/or directors of the Company (Carol J. Parker, derivatively on behalf of Avon Products, Inc. v. W. Don Cornwell, et al. and Avon Products, Inc. as nominal defendant (filed in the New York Supreme Court, Nassau County, Index No. 600570/2010); Lynne Schwartz, derivatively on behalf of Avon Products, Inc. v. Andrea Jung, et al. and Avon Products, Inc. as nominal defendant (filed in the New York Supreme Court, New York County, Index No. 651304/2010)). On November 22, 2013, a derivative action was filed in federal court against certain present or former officers and/or directors of the Company and following the federal court's dismissal, an additional action was subsequently filed in New York state court on May 1, 2015 (Sylvia Pritika, derivatively on behalf of Avon Products, Inc. v. Andrea Jung, et al. and Avon Products, Inc. as nominal defendant (filed in the New York Supreme Court, New York County, Index No. 651479/2015)). The claims asserted in one or more of these actions include alleged breach of fiduciary duty, abuse of control, waste of corporate assets, and unjust enrichment, relating to the Company's compliance with the FCPA, including the adequacy of the Company's internal controls. The relief sought against the individual defendants in one or more of these derivative actions include certain declaratory and equitable relief, restitution, damages, exemplary damages and interest. The Company is a nominal defendant, and no relief is sought against the Company itself. On April 28, 2015, an action was filed to seek enforcement of demands for the inspection of certain of the Company’s books and records (Belle Cohen v. Avon Products, Inc. (filed in the New York Supreme Court, New York County, Index No. 651418/2015)). The parties have reached agreements to settle the derivative and books and records actions. The terms of settlement include certain corporate governance measures as well as releases of claims. The Company has accrued approximately $4 with respect to these matters, which the Company expects will be paid by insurance. Settlement is conditioned upon court approval of the proposed resolution of the derivative actions. On March 30, 2016, the court granted preliminary approval of the settlement. On June 30, 2016, the court held a hearing to consider final approval of the settlement and, thereafter, the court entered the order and judgment approving the settlement. In light of the settlement, stipulations voluntarily dismissing or discontinuing the actions with prejudice have been filed in the Pritika and Parker actions. In the event that the settlement of the derivative actions does not become final, we are unable to predict the outcome of these matters.

On July 6, 2011, a purported shareholder's class action complaint (City of Brockton Retirement System v. Avon Products, Inc., et al., No. 11-CIV-4665) was filed in the United States District Court for the Southern District of New York against the Company and certain present or former officers and/or directors of the Company. On September 29, 2011, the Court appointed LBBW Asset Management Investmentgesellschaft mbH and SGSS Deutschland Kapitalanlagegesellschaft mbH as lead plaintiffs and Motley Rice LLC as lead counsel. Lead plaintiffs filed an amended complaint, and the defendants moved to dismiss the amended complaint on June 14, 2012. On September 29, 2014, the Court granted the defendants' motion to dismiss and also granted the plaintiffs leave to amend their complaint. On October 24, 2014, plaintiffs filed their second amended complaint on behalf of a purported class consisting of all persons or entities who purchased or otherwise acquired shares of Avon's common stock from July 31, 2006 through and including October 26, 2011. The second amended complaint names as defendants the Company and two individuals and asserts violations of Sections 10(b) and 20(a) of the Exchange Act based on allegedly false or misleading statements and omissions with respect to, among other things, the Company's compliance with the FCPA, including the adequacy of the Company's internal controls. Plaintiffs seek compensatory damages and declaratory, injunctive, and other equitable relief. Defendants moved to dismiss the Second Amended Complaint on November 21, 2014. The parties have reached an agreement on a settlement of this class action. The terms of settlement include releases by members of the class of claims against the Company and the individual defendants and payment of $62. Under the terms of the settlement, approximately $60 of the settlement was paid by the Company's insurers and approximately $2 was paid by the Company (which represented the remaining deductible under the Company’s applicable insurance policy) into escrow. On August 21, 2015, the court granted preliminary approval of the settlement, and on December 1, 2015 the court held a hearing to consider final approval of the settlement and expressed an intent to grant final approval. However, the court has not yet entered a final judgment approving the settlement. If the settlement is not approved by the court, or is otherwise terminated before it is finalized, the Company will be unable to predict the outcome of this matter. Furthermore, in that event, it is reasonably possible that the Company may incur a loss in connection with this matter, which the Company is unable to reasonably estimate.

Between December 23, 2014 and March 12, 2015, two purported class actions were filed in the United States District Court for the Southern District of New York -- Poovathur v. Avon Products, Inc., et al. (No. 14-CV-10083) and McCoy et al. v. Avon

17

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

Products, Inc., et al. (No. 15-CV-01828) asserting claims under the Employee Retirement Income Security Act ("ERISA") against the Company, the Plan's administrator, benefits board and investment committee, and certain individuals alleged to have served as Plan fiduciaries. On April 8, 2015, the Court consolidated the two actions and recaptioned the consolidated case as In re 2014 Avon Products, Inc. ERISA Litigation, (No. 14-CV-10083). On May 8, 2015, plaintiffs filed a consolidated complaint, asserting claims for alleged breach of fiduciary duty and failure to monitor under ERISA on behalf of a purported class of participants in and beneficiaries of the Plan who invested in and/or held shares of the Avon Common Stock Fund between July 31, 2006 and May 1, 2014 and between December 14, 2011 and the present.  Plaintiffs seek, inter alia, certain monetary relief, damages, and declaratory, injunctive and other equitable relief. On July 9, 2015, Defendants moved to dismiss the consolidated complaint. The parties have reached an agreement on a settlement of this class action. The terms of settlement include releases by members of the class of claims against the Company and the individual defendants and payment of approximately $6. Under the terms of the settlement, approximately $5 of the settlement will be paid by the Company’s insurer and approximately $1 will be paid by the Company (which represents the remaining deductible under the Company’s applicable insurance policy). On June 7, 2016, the court granted preliminary approval of the settlement and scheduled a hearing to consider final approval for October 11, 2016. If the settlement is not approved by the court, or is otherwise terminated before it is finalized, the Company will be unable to predict the outcome of this matter. Furthermore, in that event, it is reasonably possible that the Company may incur a loss in connection with this matter, which the Company is unable to reasonably estimate.

Under some circumstances, any losses incurred in connection with adverse outcomes in the litigation matters described above could be material.

Brazilian Tax Assessments

In 2002, our Brazilian subsidiary received an excise tax (IPI) assessment from the Brazilian tax authorities for alleged tax deficiencies during the years 1997-1998. In December 2012, additional assessments were received for the year 2008 with respect to excise tax (IPI) and taxes charged on gross receipts (PIS and COFINS). In the second quarter of 2014, the PIS and COFINS assessments were officially closed in favor of Avon Brazil. The 2002 and the 2012 IPI assessments assert that the establishment in 1995 of separate manufacturing and distribution companies in Brazil was done without a valid business purpose and that Avon Brazil did not observe minimum pricing rules to define the taxable basis of excise tax. The structure adopted in 1995 is comparable to that used by many other companies in Brazil. We believe that our Brazilian corporate structure is appropriate, both operationally and legally, and that the 2002 and 2012 IPI assessments are unfounded.

These matters are being vigorously contested. In January 2013, we filed a protest seeking a first administrative level review with respect to the 2012 IPI assessment. In July 2013, the 2012 IPI assessment was upheld at the first administrative level and we have appealed this decision to the second administrative level. The 2012 IPI assessment totals approximately $315, including penalties and accrued interest. In October 2010, the 2002 IPI assessment was upheld at the first administrative level at an amount reduced to approximately $28 from approximately $66, including penalties and accrued interest. We appealed this decision to the second administrative level, which ruled in favor of Avon in March 2015 and canceled the 2002 IPI assessment. The Brazilian tax authorities' appeal to this favorable decision regarding the 2002 IPI assessment is still pending.

In the event that the 2002 or 2012 IPI assessments are upheld at the last administrative level, it may be necessary for us to provide security to pursue further appeals, which, depending on the circumstances, may result in a charge to earnings. It is not possible to reasonably estimate the likelihood or potential amount of assessments that may be issued for subsequent periods (tax years up through 2010 are closed by statute). However, other similar IPI assessments involving different periods (1998-2001) have been canceled and officially closed in our favor by the second administrative level. We believe that the likelihood that the 2002 IPI assessment will be upheld on any further appeal is remote and the likelihood that the 2012 IPI assessment will be upheld is reasonably possible. As stated above, we believe that the 2002 and 2012 IPI assessments are unfounded.

Brazil IPI Tax on Cosmetics

In May 2015, an Executive Decree on certain cosmetics went into effect in Brazil which increased the amount of IPI taxes that are to be remitted by Avon Brazil to the taxing authority on the sales of cosmetic products subject to IPI. Avon Brazil filed an objection to this IPI tax increase on the basis that it is not constitutional. From May 2015 through April 2016 Avon Brazil remitted the taxes associated with this IPI tax increase into a judicial deposit which would be remitted to the taxing authorities in the event that we are not successful in our objection to the tax increase.

In May 2016, Avon Brazil received a favorable preliminary decision on its objection to the tax and was granted a preliminary injunction. As a result, beginning in May 2016 Avon Brazil is no longer required to remit the taxes associated with IPI into a judicial deposit. As the IPI tax increase remains in effect, Avon Brazil is continuing to recognize the IPI taxes associated with the May 2015 Executive Decree as a liability. At June 30, 2016, the liability to the taxing authorities for this IPI tax increase

18

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

was $82 and was classified within other liabilities in the Consolidated Balance Sheets, and the judicial deposit was $64 and was classified within other assets in the Consolidated Balance Sheets.

An unfavorable ruling to our objection of this IPI tax increase would have an adverse effect on our consolidated cash flows as Avon Brazil would have to remit the liability owed to the taxing authorities. This amount would be partially offset by the amount of the judicial deposit held by Avon Brazil. We are not able to reliably predict the timing of the outcome of our objection to this tax increase.

Other Matters

Various other lawsuits and claims, arising in the ordinary course of business or related to businesses previously sold, are pending or threatened against Avon. In management's opinion, based on its review of the information available at this time, the total cost of resolving such other contingencies at June 30, 2016, is not expected to have a material adverse effect on our consolidated financial position, results of operations or cash flows.

9. 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, 2016 and 2015:

Three Months Ended June 30, 2016:	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Total
Balance at March 31, 2016	$	(854.8	)	$	(.9	)	$	(4.3	)	$	(146.6	)	$	(1,006.6	)
Other comprehensive loss other than reclassifications	(7.9		)	—			—			(1.4		)	(9.3		)
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0(1)	—			.5			—			—			.5
Amortization of net actuarial loss and prior service cost, net of tax of $.2(2)	—			—			—			5.6			5.6
Total reclassifications into earnings	—			.5			—			5.6			6.1
Balance at June 30, 2016	$	(862.7	)	$	(.4	)	$	(4.3	)	$	(142.4	)	$	(1,009.8	)

Three Months Ended June 30, 2015:	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Total
Balance at March 31, 2015	$	(803.1	)	$	(2.8	)	$	(4.3	)	$	(523.4	)	$	(1,333.6	)
Other comprehensive income other than reclassifications	21.4			—			—			—			21.4
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0(1)	—			.5			—			—			.5
Amortization of net actuarial loss and prior service cost, net of tax of $.3(2)	—			—			—			13.3			13.3
Total reclassifications into earnings	—			.5			—			13.3			13.8
Balance at June 30, 2015	$	(781.7	)	$	(2.3	)	$	(4.3	)	$	(510.1	)	$	(1,298.4	)

19

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

Six Months Ended June 30, 2016:	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Total
Balance at December 31, 2015	$	(950.0	)	$	(1.3	)	$	(4.3	)	$	(410.6	)	$	(1,366.2	)
Other comprehensive income (loss) other than reclassifications	16.0			—			—			(14.1		)	1.9
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0(1)	—			.9			—			—			.9
Amortization of net actuarial loss and prior service cost, net of tax of $.4(2)	—			—			—			12.3			12.3
Deconsolidation of Venezuela, net of tax of $0.0	81.3			—			—			.8			82.1
Separation of North America, net of tax of $10.2	(10.0		)	—			—			269.2			259.2
Total reclassifications into earnings	71.3			.9			—			282.3			354.5
Balance at June 30, 2016	$	(862.7	)	$	(.4	)	$	(4.3	)	$	(142.4	)	$	(1,009.8	)

Six Months Ended June 30, 2015:	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Total
Balance at December 31, 2014	$	(677.0	)	$	(3.2	)	$	(4.3	)	$	(533.1	)	$	(1,217.6	)
Other comprehensive loss other than reclassifications	(104.7		)	—			—			(3.6		)	(108.3		)
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0(1)	—			.9			—			—			.9
Amortization of net actuarial loss and prior service cost, net of tax of $.6(2)	—			—			—			26.6			26.6
Total reclassifications into earnings	—			.9			—			26.6			27.5
Balance at June 30, 2015	$	(781.7	)	$	(2.3	)	$	(4.3	)	$	(510.1	)	$	(1,298.4	)

(1) Gross amount reclassified to interest expense, and related taxes reclassified to income taxes.

(2) Gross amount reclassified to pension and postretirement expense, within selling, general & administrative expenses, and related taxes reclassified to income taxes.

Foreign exchange net loss of $9.7 and net gain of $10.4 for the three months ended June 30, 2016 and 2015, respectively, and foreign exchange net losses of $10.9 and $8.3 for the six months ended June 30, 2016 and 2015, respectively, resulting from the translation of actuarial losses and prior service cost recorded in AOCI are included in changes in foreign currency translation adjustments in the Consolidated Statements of Comprehensive Income (Loss).

10. SEGMENT INFORMATION

We determine segment profit by deducting the related costs and expenses from segment revenue. In order to ensure comparability between periods, segment profit includes an allocation of global marketing expenses based on actual revenues. Segment profit excludes global expenses other than marketing, costs to implement ("CTI") restructuring initiative (see Note 12, Restructuring Initiatives), certain significant asset impairment charges, and other items, which are not allocated to a particular segment, if applicable. This is consistent with the manner in which we assess our performance and allocate resources.

20

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

Effective January, 1, 2016, we have updated our reportable segments. Prior periods have been restated to conform with the new presentation. Summarized financial information concerning our reportable segments was as follows:

Total Revenue	Three Months Ended June 30,				Six Months Ended June 30,
	2016		2015		2016		2015
Europe, Middle East & Africa	$	520.9	$	530.1	$	1,041.3	$	1,062.3
South Latin America	535.7		607.5		962.1		1,198.4
North Latin America	224.4		236.0		429.1		465.3
Asia Pacific	141.9		158.0		278.6		322.1
Total revenue from reportable segments	1,422.9		1,531.6		2,711.1		3,048.1
Other operating segments and business activities	11.4		33.3		29.7		68.9
Total revenue	$	1,434.3	$	1,564.9	$	2,740.8	$	3,117.0

Operating Profit	Three Months Ended June 30,						Six Months Ended June 30,
	2016			2015			2016			2015
Segment Profit
Europe, Middle East & Africa	$	83.4		$	73.2		$	152.1		$	137.1
South Latin America	61.0			69.2			84.1			136.9
North Latin America	32.1			31.6			60.6			60.2
Asia Pacific	14.8			16.5			29.5			38.7
Total profit from reportable segments	$	191.3		$	190.5		$	326.3		$	372.9
Other operating segments and business activities	.7			4.9			4.9			10.0
Unallocated global expenses	(87.5		)	(96.6		)	(172.1		)	(183.4		)
CTI restructuring initiatives	(9.4		)	(2.9		)	(56.2		)	(30.1		)
Venezuelan special items	—			(6.2		)	—			(112.6		)
Operating profit	$	95.1		$	89.7		$	102.9		$	56.8

Other operating segments and business activities include the business results for Liz Earle, which was sold in July 2015, and Venezuela, which was deconsolidated effective March 31, 2016. 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.

11. SUPPLEMENTAL BALANCE SHEET INFORMATION

At June 30, 2016 and December 31, 2015, prepaid expenses and other included the following:

Components of Prepaid Expenses and Other	June 30, 2016		December 31, 2015
Prepaid taxes and tax refunds receivable	$	101.9	$	96.3
Receivables other than trade	79.0		69.6
Prepaid brochure costs, paper, and other literature	75.1		64.5
Other	58.0		65.7
Prepaid expenses and other	$	314.0	$	296.1

21

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

At June 30, 2016 and December 31, 2015, other assets included the following:

Components of Other Assets	June 30, 2016		December 31, 2015
Long-term receivables	$	214.5	$	162.1
Deferred tax assets	190.0		172.8
Capitalized software	83.9		82.4
Investment in New Avon	38.0		—
Investments	37.2		36.3
Tooling (plates and molds associated with our beauty products)	13.9		15.3
Other	27.0		21.1
Other assets	$	604.5	$	490.0

12. RESTRUCTURING INITIATIVES

Transformation Plan

In January 2016, we announced the Transformation Plan, which includes cost reduction efforts to continue to improve our cost structure and to enable us to reinvest in growth. As a result of this plan, we have targeted pre-tax annualized cost savings of approximately $350 after three years, with an estimated $200 from supply chain reductions and an estimated $150 from other cost reductions, which are expected to be achieved through restructuring actions, as well as other cost-savings strategies that will not result in restructuring charges. We plan to reinvest a portion of these cost savings in growth initiatives, including media, social selling and information technology systems that will help us modernize our business. We initiated the Transformation Plan in order to enable us to achieve our long-term goals of double-digit operating margin and mid single-digit Constant $ revenue growth. As part of the Transformation Plan, we identified certain actions, that we believe will reduce ongoing costs, primarily consisting of global headcount reductions relating to operating model changes. These operating model changes include streamlining of our corporate functions to align with the current and future needs of the business and an information technology infrastructure outsourcing initiative.

As a result of these restructuring actions approved-to-date, we have recorded total costs to implement these restructuring initiatives of $79.9 before taxes, of which $57.5 was recorded in the first six months of 2016, in the Consolidated Statements of Operations. The additional charges not yet incurred associated with the restructuring actions approved to-date of approximately $15 to $25 before taxes are expected to be recorded primarily in 2016. At this time we are unable to quantify the total costs to implement these restructuring initiatives that will be incurred through the time the Transformation Plan is fully implemented. In connection with the restructuring actions approved to-date associated with the Transformation Plan, we expect to realize annualized savings of approximately $90 to $100 (before tax). We expect to realize approximately $25 of savings in 2016 and are expected to achieve the significant majority of the annualized savings beginning in 2017. The annualized savings represent the net reduction of expenses that will no longer be incurred by Avon.

Restructuring Charges - Three and Six Months Ended June 30, 2016

During the three and six months ended June 30, 2016, we recorded costs to implement of $10.0 and $57.5, respectively, related to the Transformation Plan, in the Consolidated Statement of Operations. The costs consisted of the following:

• net charges of $2.8 and $49.9, respectively, primarily for employee-related costs, including severance benefits;

• contract termination and other net charges of $4.6 and $4.6, respectively;

• implementation costs of $1.1 and $1.5, respectively, primarily related to professional service fees;

• accelerated depreciation of $1.2 and $1.2, respectively; and

• inventory write-offs of $.3 and $.3, respectively.

Of the total costs to implement during the three months ended June 30, 2016, $9.7 was recorded in selling, general and administrative expenses and $.3 was recorded in cost of sales. Of the total costs to implement during the six months ended June 30, 2016, $57.2 was recorded in selling, general and administrative expenses and $.3 was recorded in cost of sales. The majority of cash payments, if applicable, associated with these charges are expected to be made during 2016.

22

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

The liability balance for the Transformation Plan as of June 30, 2016 is as follows:

	Employee-Related Costs			Contract Terminations/Other		Total
Balance at December 31, 2015	$	21.4		$	—	$	21.4
2016 charges	57.8			4.6		62.4
Adjustments	(7.9		)	—		(7.9		)
Cash payments	(17.1		)	—		(17.1		)
Foreign exchange	.2			—		.2
Balance at June 30, 2016	$	54.4		$	4.6	$	59.0

The following table presents the restructuring charges incurred to date, under the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plan:

	Employee- Related Costs		Contract Terminations/Other		Foreign Currency Translation Adjustment Write-offs		Total
Charges incurred to date	$	71.3	$	4.6	$	—	$	75.9
Estimated charges to be incurred on approved initiatives	6.3		2.0		2.0		10.3
Total expected charges on approved initiatives	$	77.6	$	6.6	$	2.0	$	86.2

The charges, net of adjustments, of initiatives under the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plan, by reportable business segment were as follows:

	Europe, Middle East & Africa			South Latin America		North Latin America			Asia Pacific		Global & Other Operating Segments		Total
2015	$	—		$	—	$	—		$	—	$	21.4	$	21.4
First quarter 2016	21.9			12.1		3.3			4.7		5.1		47.1
Second quarter 2016	(.1		)	1.0		(.4		)	2.9		4.0		7.4
Charges incurred to date	21.8			13.1		2.9			7.6		30.5		75.9
Estimated charges to be incurred on approved initiatives	1.7			.1		—			2.3		6.2		10.3
Total expected charges on approved initiatives	$	23.5		$	13.2	$	2.9		$	9.9	$	36.7	$	86.2

We expect our total costs to implement restructuring on approved initiatives to be approximately $95 to $105 before taxes under the Transformation Plan. The amounts shown in the tables above as charges recorded to-date relate to initiatives that have been approved and recorded in the financial statements as the costs are probable and estimable. The amounts shown in the tables above as total expected charges on approved initiatives represent charges recorded to-date plus charges yet to be recorded for approved initiatives as the relevant accounting criteria for recording an expense have not yet been met. In addition to the charges included in the tables above, we have incurred and will continue to incur other costs to implement restructuring initiatives such as professional services fees and accelerated depreciation.

Additional Restructuring Charges 2015

As a result of the then-current economic environment, including the impact of foreign currency movements and inflation on our expenses, and in an effort to continue to improve our cost structure, we identified certain actions during 2015 that we believe would reduce ongoing costs. These actions primarily consisted of global headcount reductions.

As a result of these restructuring actions, we recorded a net benefit of $.7 before taxes, during the six months ended June 30, 2016 in selling, general and administrative expenses, in the Consolidated Statements of Operations. There are no material remaining costs for restructuring actions approved-to-date. In connection with these restructuring actions, we realized annualized savings of approximately $30 before taxes. We began to realize savings in the second quarter of 2015 and achieved the annualized savings beginning in the third quarter of 2015. The annualized savings represent the net reduction of expenses that will no longer be incurred by Avon.

23

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

Restructuring Charges – Three and Six Months Ended June 30, 2016

The costs to implement recorded during the three and six months ended June 30, 2016 consisted of net benefits of $.2 and $.7, respectively, primarily for employee-related costs due to severance benefits.

Restructuring Charges – Three and Six Months Ended June 30, 2015

The costs to implement recorded during the three and six months ended June 30, 2015 consisted of the following:

• a benefit of $.3 and a charge of $24.7, respectively, for employee-related costs due to severance benefits; and

• implementation costs of $3.5 and $5.4, respectively, primarily for professional service fees associated with Corporate and Asia Pacific.

The liability balance, which consists of employee-related costs, for these various restructuring initiatives as of June 30, 2016 is as follows:

	Total
Balance at December 31, 2015	$	4.0
2016 charges	—
Adjustments	(.7		)
Cash payments	(1.5		)
Foreign exchange	—
Balance at June 30, 2016	$	1.8

The majority of cash payments associated with this liability are expected to be made during 2016.

The charges, net of adjustments, of these various restructuring initiatives, by reportable business segment were as follows:

	Europe, Middle East & Africa		South Latin America		North Latin America		Asia Pacific			Global & Other Operating Segments			Total
2015	$	4.2	$	2.7	$	.2	$	5.8		$	9.2		$	22.1
First Quarter 2016	—		—		—		(.1		)	(.4		)	(.5		)
Second Quarter 2016	—		—		—		—			(.2		)	(.2		)
Charges incurred to date	$	4.2	$	2.7	$	.2	$	5.7		$	8.6		$	21.4

In addition to the charges included in the tables above, we have incurred other costs to implement restructuring initiatives such as professional services fees.

Other Restructuring Initiatives

During the three and six months ended June 30, 2016, we recorded net benefits of $.4 and $.6, respectively, in selling, general and administrative expenses, in the Consolidated Statements of Operations, associated with the restructuring programs launched in 2005 and 2009 and the restructuring initiatives launched in 2012 (the "Other Restructuring Initiatives" and "$400M Cost Savings Initiative"), which are substantially complete. During the three and six months ended June 30, 2015, we recorded net benefits of $.3 and an immaterial amount, respectively, in selling, general and administrative expenses, in the Consolidated Statements of Operations, associated with the Other Restructuring Initiatives. The liability balance associated with the Other Restructuring Initiatives, which primarily consists of employee-related costs and contract termination costs, as of June 30, 2016 is not material.

24

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

13. GOODWILL

Goodwill

	Europe, Middle East & Africa			South Latin America		Asia Pacific			Total
Gross balance at December 31, 2015	$	27.7		$	68.9	$	85.0		$	181.6
Accumulated impairments	(6.9		)	—		(82.4		)	(89.3		)
Net balance at December 31, 2015	$	20.8		$	68.9	$	2.6		$	92.3
Changes during the period ended June 30, 2016:
Foreign exchange	(.1		)	3.9		—			3.8
Gross balance at June 30, 2016	$	27.6		$	72.8	$	85.0		$	185.4
Accumulated impairments	(6.9		)	—		(82.4		)	(89.3		)
Net balance at June 30, 2016	$	20.7		$	72.8	$	2.6		$	96.1

14. FAIR VALUE

Assets and Liabilities Recorded at Fair Value

The fair value measurement provisions required by GAAP establish a fair value hierarchy, which prioritizes the inputs used in measuring fair value into three broad levels as follows:

• Level 1 - Quoted prices in active markets for identical assets or liabilities.

• Level 2 - Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly.

• Level 3 - Unobservable inputs based on our own assumptions.

Assets and Liabilities Recorded at Fair Value on a Recurring Basis

The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of June 30, 2016:

	Level 1		Level 2		Total
Assets:
Available-for-sale securities	$	2.8	$	—	$	2.8
Foreign exchange forward contracts	—		.1		.1
Total	$	2.8	$	.1	$	2.9
Liabilities:
Foreign exchange forward contracts	$	—	$	4.9	$	4.9
Total	$	—	$	4.9	$	4.9

The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis

as of December 31, 2015:

	Level 1		Level 2		Total
Assets:
Available-for-sale securities	$	—	$	—	$	—
Foreign exchange forward contracts	—		1.2		1.2
Total	$	—	$	1.2	$	1.2
Liabilities:
Foreign exchange forward contracts	$	—	$	1.1	$	1.1
Total	$	—	$	1.1	$	1.1

25

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

Fair Value of Financial Instruments

Our financial instruments include cash and cash equivalents, available-for-sale securities, short-term investments, accounts receivable, loans receivable, debt maturing within one year, accounts payable, long-term debt and foreign exchange forwards 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, 2016 and December 31, 2015, respectively, consisted of the following:

	June 30, 2016						December 31, 2015
	Carrying Amount			Fair Value			Carrying Amount			Fair Value
Available-for-sale securities	$	2.8		$	2.8		$	2.8		$	2.8
Debt maturing within one year(1)	(48.8		)	(48.8		)	(55.2		)	(55.2		)
Long-term debt(1)	(2,139.6		)	(1,755.5		)	(2,150.5		)	(1,622.7		)
Foreign exchange forward contracts	(4.8		)	(4.8		)	.1			.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.

15. 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. As of June 30, 2016, we do not have any interest-rate swap agreements.

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 on the Consolidated Balance Sheets at their fair values. The following table presents the fair value of derivative instruments outstanding at June 30, 2016:

	Asset			Liability
	Balance Sheet Classification	Fair Value		Balance Sheet Classification	Fair Value
Derivatives not designated as hedges:
Foreign exchange forward contracts	Prepaid expenses and other	$	.1	Accounts payable	$	4.9
Total derivatives not designated as hedges		$	.1		$	4.9
Total derivatives		$	.1		$	4.9

26

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

The following table presents the fair value of derivative instruments outstanding at December 31, 2015:

	Asset			Liability
	Balance Sheet Classification	Fair Value		Balance Sheet Classification	Fair Value
Derivatives not designated as hedges:
Foreign exchange forward contracts	Prepaid expenses and other	$	1.2	Accounts payable	$	1.1
Total derivatives not designated as hedges		$	1.2		$	1.1
Total derivatives		$	1.2		$	1.1

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. At times, we may de-designate the hedging relationship of a receive-fixed/pay-variable interest-rate swap agreement. In these cases, we enter into receive-variable/pay-fixed interest-rate swap agreements that are designated to offset the gain or loss on the de-designated contract. As of June 30, 2016, we do not have any interest-rate swap agreements. Approximately 2% of our debt portfolio at June 30, 2016 and December 31, 2015 was exposed to floating interest rates.

In January 2013, we terminated eight of our interest-rate swap agreements previously designated as fair value hedges, with notional amounts totaling $1,000. As of the interest-rate swap agreements’ termination date, the aggregate favorable adjustment to the carrying value (deferred gain) of our debt was $90.4, which is being amortized as a reduction to interest expense over the remaining term of the underlying debt obligations. The net impact of the gain amortization was $3.7 and $7.4, respectively, for the three and six months ended June 30, 2016, and $3.6 and $7.3, respectively, for the three and six months ended June 30, 2015. The interest-rate swap agreements were terminated in order to improve our capital structure, including increasing our ratio of fixed-rate debt. At June 30, 2016, the unamortized deferred gain associated with the January 2013 interest-rate swap termination was $28.0, and was classified within long-term debt in the Consolidated Balance Sheets.

In March 2012, we terminated two of our interest-rate swap agreements previously designated as fair value hedges, with notional amounts totaling $350. As of the interest-rate swap agreements’ termination date, the aggregate favorable adjustment to the carrying value (deferred gain) of our debt was $46.1, which is being amortized as a reduction to interest expense over the remaining term of the underlying debt obligations through March 2019. The net impact of the gain amortization was $1.7 and $3.4, respectively, for the three and six months ended June 30, 2016, and $1.7 and $3.3, respectively, for the three and six months ended June 30, 2015. The interest-rate swap agreements were terminated in order to increase our ratio of fixed-rate debt. At June 30, 2016, the unamortized deferred gain associated with the March 2012 interest-rate swap termination was $19.4, and was classified within long-term debt in the Consolidated Balance Sheets.

Foreign Currency Risk

We may use foreign exchange forward contracts to manage a portion of our foreign currency exchange rate exposures. At June 30, 2016, we had outstanding foreign exchange forward contracts with notional amounts totaling approximately $83.2 for various currencies.

We may use foreign exchange forward contracts to manage foreign currency exposure of certain intercompany loans. These contracts are not designated as hedges. The change in fair value of these contracts is immediately recognized in earnings and substantially offsets the foreign currency impact recognized in earnings relating to the associated intercompany loans. During the three and six months ended June 30, 2016, we recorded losses of $5.2 and $7.5, respectively, in other expense, net in the Consolidated Statements of Operations related to these undesignated foreign exchange forward contracts. Also during the three and six months ended June 30, 2016, we recorded gains of $4.6 and $5.4, respectively, related to the associated intercompany loans, caused by changes in foreign currency exchange rates.During the three and six months ended June 30, 2015, we recorded losses of $.9 and $8.9, respectively, in other expense, net in the Consolidated Statements of Operations related to these undesignated foreign exchange forward contracts. During the three and six months ended June 30, 2015, we recorded a loss of $.6 and a gain of $8.1 related to the associated intercompany loans, caused by changes in foreign currency exchange rates.

27

AVON PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

16. DEBT

Revolving Credit Facility

In June 2015, the Company and Avon International Operations, Inc., a wholly-owned domestic subsidiary of the Company (“AIO”), entered into a five-year $400.0 senior secured revolving credit facility (the “2015 facility”). Borrowings under the 2015 facility bear interest, at our option, at a rate per annum equal to LIBOR plus 250 basis points or a floating base rate plus 150 basis points, in each case subject to adjustment based upon a leverage-based pricing grid. As of June 30, 2016, there were no amounts outstanding under the 2015 facility.

All obligations of AIO under the 2015 facility are (i) unconditionally guaranteed by each material domestic restricted subsidiary of the Company (other than AIO, the borrower), in each case, subject to certain exceptions and (ii) guaranteed on a limited recourse basis by the Company. The obligations of AIO and the guarantors are secured by first priority liens on and security interest in substantially all of the assets of AIO and the subsidiary guarantors and by certain assets of the Company, in each case, subject to certain exceptions.

The 2015 facility will terminate in June 2020; provided, however, that it shall terminate on the 91^st day prior to the maturity of the 2018 Notes (as defined below), the 4.20% Notes (as defined below), the 2019 Notes (as defined below) and the 4.60% Notes (as defined below), if on such 91^st day, the applicable notes are not redeemed, repaid, discharged, defeased or otherwise refinanced in full.

The 2015 facility contains affirmative and negative covenants, which are customary for secured financings of this type, as well as financial covenants (interest coverage and total leverage ratios). As of June 30, 2016, we were in compliance with our interest coverage and total leverage ratios under the 2015 facility. The amount of the facility available to be drawn down on is reduced by any standby letters of credit granted by AIO. AIO has issued approximately $38 of standby letters of credit. As of June 30, 2016, based on then applicable interest rates, approximately $335 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; and $250.0 principal amount of 6.95% Notes due March 15, 2043 (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 with S&P and Moody's. As described in the indenture, the interest rates on the 2013 Notes increase by .25% for each one-notch downgrade below investment grade on each of our long-term credit ratings assigned to the 2013 Notes by S&P or Moody's. These adjustments are limited to a total increase of 2% above the respective interest rates in effect on the date of issuance of the 2013 Notes. As a result of the long-term credit rating downgrades by S&P and Moody's in 2014, 2015 and 2016, the interest rates on the 2013 Notes increased by a total of 2%, and as such, we have reached the maximum allowable increase in interest rates on these Notes, with the last .25% effective as of September 15, 2016.

At June 30, 2016, we also have outstanding $250.0 principal amount of our 5.75% Notes due March 1, 2018 (the "2018 Notes"); $250.0 principal amount of our 4.20% Notes due July 15, 2018 (the "4.20% Notes"); and $350.0 principal amount of our 6.50% Notes due March 1, 2019 (the "2019 Notes"), with interest on each series of these Notes payable semi-annually.

The indentures governing our outstanding notes described above contain certain customary covenants and customary events of default and cross-default provisions. Further, we would be required to make an offer to repurchase all of our outstanding notes described above, with the exception of our 4.20% Notes, at a price equal to 101% of their aggregate principal amount plus accrued and unpaid interest in the event Avon undergoes a change of control and, at such time, the outstanding notes are rated below investment grade.

Long-Term Credit Ratings

Our long-term credit ratings are Ba3 (Negative Outlook) for corporate family debt, and B1 (Negative Outlook) for senior unsecured debt, with Moody's; B (Stable Outlook) with S&P; and B+ (Negative Outlook) with Fitch, which are below investment grade. We do not believe these long-term credit ratings will have a material impact on our near-term liquidity. However, any rating agency reviews could result in a change in outlook or downgrade, which could further limit our access to new financing, particularly short-term financing, reduce our flexibility with respect to working capital needs, affect the market price of some or all of our outstanding debt securities, and likely result in an increase in financing costs, and less favorable covenants and financial terms under our financing arrangements.

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AVON PRODUCTS, INC.

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 2015, we had sales operations in 57 countries and territories, and distributed products in 15 more. Effective January, 1, 2016, 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 (which includes personal care), fragrance and color (cosmetics). Fashion & Home consists of fashion jewelry, watches, apparel, footwear, accessories, gift and decorative products, housewares, entertainment and leisure products, children’s products and nutritional products. Sales are made to the ultimate consumer principally through direct selling by Representatives, who are independent contractors and not our employees. At December 31, 2015, we had nearly 6 million active Representatives. The success of our business is highly dependent on recruiting, retaining and servicing our Representatives. During 2015, all of our consolidated revenue was derived from operations outside of the United States ("U.S.").

During the six months ended June 30, 2016, revenue declined 12% compared to the prior-year period, primarily due to unfavorable foreign exchange, while Constant $ revenue increased 3%. The Constant $ revenue comparison was negatively impacted by approximately 1 point as a result of the sale of Liz Earle, which was completed in July 2015. The Constant $ revenue comparison was also negatively impacted by an estimated 1 point due to the Industrial Production Tax ("IPI") on cosmetics in Brazil that went into effect in May 2015. In addition, our Constant $ revenue benefited from growth in Europe, Middle East & Africa, most significantly Russia, and to a lesser extent, South Africa. Constant $ revenue benefited from higher average order, which was partially offset by a decrease in Active Representatives. The net impact of price and mix increased 7% as we have been improving our discipline of pricing with inflation, strategically pricing in certain markets and categories, and launching products at more advantageous price points, while managing the potential impact on unit sales. Units sold decreased 4%, primarily due to declines in units sold in Brazil and Mexico and the impact of the deconsolidation of Venezuela, partially offset by an increase in units sold in Russia. The decrease in Active Representatives was primarily due to the impact of the deconsolidation of Venezuela and declines in South Latin America, primarily Brazil, and Asia Pacific. These declines in Active Representatives were partially offset by growth in Europe, Middle East & Africa, most significantly Russia, which was primarily due to sustained momentum in recruitment and retention. See "Segment Review" in this MD&A for additional information related to changes in revenue by segment.

Ending Representatives (as defined below in "Performance Metrics" in this MD&A) decreased by 1%. The decrease in Ending Representatives at June 30, 2016 as compared to the prior-year period was primarily due to the impact of the deconsolidation of Venezuela, which had a negative impact of 3 points, and to a lesser extent, declines in Asia Pacific. These decreases were partially offset by growth in Europe, Middle East & Africa, most significantly Russia and South Africa, as well as growth in South Latin America.

During the six months ended June 30, 2016, foreign currency had a significant impact on our financial results. As the U.S. dollar has strengthened relative to currencies of key Avon markets, our revenue and profits have been reduced when translated into U.S. dollars and our margins have been negatively impacted by country mix, as certain of our markets which have historically had higher operating margins experienced significant devaluation of their local currency. In addition, as our sales and costs are often denominated in different currencies, this has created a negative foreign currency transaction impact. Specifically, 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 selling, general and administrative expenses), which had an unfavorable impact to operating profit and Adjusted operating profit of an estimated $115, foreign currency translation, which had an unfavorable impact to operating profit of approximately $50 and Adjusted operating profit of approximately $55, and lower foreign exchange losses on our working capital (classified within other expense, net), which had a favorable impact of approximately $8 before tax and $13 before tax on an Adjusted basis.

Effective March 31, 2016, we deconsolidated our Venezuelan operations. Our operating results for the first quarter of 2016 include the results of our Venezuelan operations; however, we have recorded a charge at March 31, 2016 to write-off balance sheet accounts associated with our Venezuela operations, and going forward, the Venezuela operating results will no longer be included in the Company's consolidated financial statements. As a result of this change in accounting, we recorded a loss of

29

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

approximately $120 in the first quarter of 2016. The loss was comprised of approximately $39 in net assets of the Venezuelan business and approximately $81 in accumulated foreign currency translation adjustments within accumulated other comprehensive loss ("AOCI") associated with foreign currency movements before Venezuela was accounted for as a highly inflationary economy. See "Venezuela Discussion" in this MD&A and Note 1, Accounting Policies, to the consolidated financial statements included herein for further discussion of our Venezuela operations.

Transformation Plan

In December 2015, we entered into definitive agreements with affiliates of Cerberus Capital Management, L.P. ("Cerberus"), which included a $435 investment in Avon by an affiliate of Cerberus through the purchase of our Series C Preferred Stock and the separation of the North America business from Avon into New Avon LLC ("New Avon"), a privately-held company that is majority-owned and managed by an affiliate of Cerberus. Avon contributed $100 and retained approximately 20% ownership in this new privately-held company. These transactions closed on March 1, 2016. The North America business, which had consisted of the Company's operations in the U.S, Canada and Puerto Rico, was previously its own reportable segment and has been presented as discontinued operations for all periods presented. See Note 3, Discontinued Operations, and Note 7, Series C Convertible Preferred Stock, to the consolidated financial statements included herein for more information.

In January 2016, we announced the transformation plan (the “Transformation Plan”), which includes investing in growth, reducing costs in an effort to continue to improve our cost structure and improving our financial resilience. As a result of this plan, we expect to invest $350 into the business over the next three years with an estimated $150 in media and social selling and $200 related to the service model evolution and information technology, which will be aimed at improving the overall Representative experience. These investments will be funded initially from cash on hand, and the continued investment over the three years from the cost savings improvements, as well as benefits from pricing actions. The launch of an improved service model in each country will depend on the existing stage of the technological development of the systems in that market supporting the Representatives. We expect to incrementally invest in media, shifting our media spend more to digital, with the focus of the spending in our top 10 markets. With regards to social selling, we have formed a team focused on social selling, and we expect to begin with a pilot market before a phased implementation.

With respect to cost reductions within our Transformation Plan, we have targeted pre-tax annualized cost savings of approximately $350 after three years. We are targeting an estimated $200 from supply chain reductions by: rationalizing our manufacturing capacity; optimizing the distribution network as the global manufacturing footprint evolves; reducing costs related to transportation, physical warehousing and distribution; and through sourcing opportunities, such as the harmonization of direct material purchases to generate greater scale and purchasing power. We are targeting an estimated $150 from other cost reductions which are expected to be achieved primarily through reductions in headcount.

We have initiated this Transformation Plan in order to enable us to achieve our long-term goals of double-digit operating margin and mid single-digit Constant $ revenue growth. We are targeting the realization of approximately $70 of these pre-tax cost savings in 2016 and incurred costs to implement ("CTI") restructuring charges of approximately $80 associated with the Transformation Plan to-date. As part of the Transformation Plan, we will transition, over time, the location of our headquarters to the United Kingdom. For additional details, see Note 12, Restructuring Initiatives, to the consolidated financial statements included herein.

NEW ACCOUNTING STANDARDS

Information relating to new accounting standards is included in Note 1, Accounting Policies, to the consolidated financial statements included herein.

PERFORMANCE METRICS

We have added a definition for our "Change in Ending Representatives" performance metric, as follows:

This metric is based on the total number of Representatives who were eligible to place an order in the last sales campaign in the related period as a result of being on an active roster. To determine the Change in Ending Representatives, this calculation is compared to the same calculation in the corresponding period of the prior year. Change in Ending Representatives may be impacted by a combination of factors such as our requirements to become and/or remain a Representative, our practices regarding minimum order requirements and our practices regarding reinstatement of Representatives. We believe this may be an indicator of future revenue performance.

30

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

RESULTS OF OPERATIONS—THE THREE AND SIX MONTHS ENDED JUNE 30, 2016 AS COMPARED TO THE THREE AND SIX MONTHS ENDED JUNE 30, 2015

Non-GAAP Financial Measures

To supplement our financial results presented in accordance with generally accepted accounting principles 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 a constant exchange rate, which is 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-currency growth rates.

We also present gross margin, selling, general and administrative expenses as a percentage of revenue, operating profit, operating margin and effective tax rate on a Non-GAAP basis. We refer to these Non-GAAP financial measures as "Adjusted." 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.

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) charges related to the deconsolidation of our Venezuela operations as of March 31, 2016 and the devaluation of Venezuelan currency in February 2015, combined with being designated as a highly inflationary economy ("Venezuelan special items"), and, as it relates to our effective tax rate discussion, 3) an income tax benefit realized in the first quarter of 2016 as a result of tax planning strategies, an income tax benefit in the second quarter of 2016 primarily due to the release of a valuation allowance associated with Russia and the non-cash income tax adjustments associated with our deferred tax assets recorded in 2015 ("Special tax items").

The Venezuelan special items include the impact on the Consolidated Statements of Operations in 2016 caused by the deconsolidation of our Venezuela operations for which we recorded a loss of approximately $120 in other expense, net. The loss was comprised of approximately $39 in net assets of the Venezuelan business and approximately $81 in accumulated foreign currency translation adjustments within AOCI associated with foreign currency changes before Venezuela was accounted for as a highly inflationary economy. The Venezuelan special items include the impact on the Consolidated Statements of Operations in 2015 caused by the devaluation of Venezuelan currency on monetary assets and liabilities, such as cash, receivables and payables; deferred tax assets and liabilities; and non-monetary assets, such as inventories. For non-monetary assets, the Venezuelan special items include the earnings impact caused by the difference between the historical U.S. dollar cost of the assets at the previous exchange rate and the revised exchange rate. In 2015, the Venezuelan special items also include adjustments of approximately $11, to reflect certain non-monetary assets at their net realizable value. In 2015, the Venezuelan special items also include an impairment charge of approximately $90 to reflect the write-down of the long-lived assets to their estimated fair value. In 2015, the devaluation was caused as a result of moving from the SICAD II exchange rate of approximately 50 to the SIMADI exchange rate of approximately 170.

In addition, the effective tax rate discussion includes Special tax items, including the impact during 2016 on income taxes in the Consolidated Statements of Operations primarily due to the release of a valuation allowance associated with Russia in the second quarter of 2016 of approximately $7. The Special tax items also include the impact during 2016 on income taxes in the Consolidated Statements of Operations due to an income tax benefit of approximately $29 recognized in the first quarter of 2016 as the result of the implementation of foreign tax planning strategies. The Special tax items also include the impact during 2015 on the provision for income taxes in the Consolidated Statements of Operations due to a non-cash income tax charge of approximately $31 and a benefit of approximately $3 associated with valuation allowances in the first and second quarters of 2015, respectively, to adjust our U.S. deferred tax assets to an amount that was "more likely than not" to be realized. The additional valuation allowance was due to the strengthening of the U.S. dollar against currencies of some of our key markets and its associated effect on our tax planning strategies, and the partial release of the valuation allowance was due to the weakening of the U.S. dollar against currencies of some of our key markets.

See Note 12, Restructuring Initiatives and Note 1, Accounting Policies, to the consolidated financial statements included herein, and "Venezuela Discussion" in this MD&A for more information on these items.

31

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

Consolidated

	Three Months Ended June 30,								Six Months Ended June 30,
	2016			2015			%/Point Change		2016			2015			%/Point Change
Total revenue	$	1,434.3		$	1,564.9		(8	)%	$	2,740.8		$	3,117.0		(12	)%
Cost of sales	565.0			611.0			(8	)%	1,083.8			1,222.7			(11	)%
Selling, general and administrative expenses	774.2			864.2			(10	)%	1,554.1			1,837.5			(15	)%
Operating profit	95.1			89.7			6	%	102.9			56.8			81	%
Interest expense	33.2			30.5			9	%	65.9			58.6			12	%
Interest income	(5.3		)	(3.1		)	71	%	(9.3		)	(6.1		)	52	%
Other (income) expense, net	(4.7		)	1.1			*		132.5			19.8			*
Income (loss) from continuing operations, net of tax	35.8			28.9			24	%	(120.0		)	(113.7		)	(6	)%
Net income (loss) attributable to Avon	$	33.0		$	28.8		15	%	$	(132.9	)	$	(118.5	)	(12	)%
Diluted earnings (loss) per share from continuing operations	$	.07		$	.06		17	%	$	(.29	)	$	(.26	)	(12	)%
Diluted earnings (loss) per share attributable to Avon	$	.06		$	.07		(14	)%	$	(.32	)	$	(.27	)	(19	)%
Advertising expenses(1)	$	25.3		$	31.6		(20	)%	$	48.3		$	66.7		(28	)%
Gross margin	60.6		%	61.0		%	(.4	)	60.5		%	60.8		%	(.3	)
CTI restructuring	—			—			—		—			—			—
Venezuelan special items	—			.4			(.4	)	—			.7			(.7	)
Adjusted gross margin	60.6		%	61.3		%	(.7	)	60.5		%	61.4		%	(.9	)
Selling, general and administrative expenses as a % of total revenue	54.0		%	55.2		%	(1.2	)	56.7		%	59.0		%	(2.3	)
CTI restructuring	(.6		)	(.2		)	(.4	)	(2.0		)	(1.0		)	(1.0	)
Venezuelan special items	—			—			—		—			(2.9		)	2.9
Adjusted selling, general and administrative expenses as a % of total revenue	53.3		%	55.0		%	(1.7	)	54.7		%	55.0		%	(.3	)
Operating profit	$	95.1		$	89.7		6	%	$	102.9		$	56.8		81	%
CTI restructuring	9.4			2.9					56.2			30.1
Venezuelan special items	—			6.2					—			112.6
Adjusted operating profit	$	104.5		$	98.8		6	%	$	159.1		$	199.5		(20	)%
Operating margin	6.6		%	5.7		%	.9		3.8		%	1.8		%	2.0
CTI restructuring	.6			.2			.4		2.0			1.0			1.0
Venezuelan special items	—			.4			(.4	)	—			3.6			(3.6	)
Adjusted operating margin	7.3		%	6.3		%	1.0		5.8		%	6.4		%	(.6	)
Change in Constant $ Adjusted operating margin(2)							2.0								.7
Change in Active Representatives							(2	)%							(2	)%
Change in units sold							(3	)%							(4	)%
Change in Ending Representatives							(1	)%							(1	)%

* Calculation not meaningful

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

(1) Advertising expenses are classified within selling, general and administrative expenses.

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

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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, 2016

Revenue

During the three months ended June 30, 2016, revenue declined 8% compared to the prior-year period, primarily due to unfavorable foreign exchange, while Constant $ revenue increased 4%. The Constant $ revenue comparison was negatively impacted by approximately 1 point as a result of the sale of Liz Earle, which was completed in July 2015. The Constant $ revenue comparison also benefited from sales of products to New Avon since the separation of the Company's North America business into New Avon on March 1, 2016, which was largely offset by the impact of the deconsolidation of Venezuela. In addition, our Constant $ revenue benefited from growth in Europe, Middle East & Africa, most significantly Russia and South Africa, as well as from growth in South Latin America and North Latin America. Constant $ revenue benefited from higher average order, which was partially offset by a 2% decrease in Active Representatives. The net impact of price and mix increased 7% as we have been improving our discipline of pricing with inflation, strategically pricing in certain markets and categories, and launching products at more advantageous price points, while managing the potential impact on unit sales. Units sold decreased 3%, primarily due to the impact of the deconsolidation of Venezuela and declines in units sold in Mexico. The decrease in Active Representatives was primarily due to the impact of the deconsolidation of Venezuela and declines in Asia Pacific. These declines in Active Representatives were partially offset by growth in Active Representatives in Europe, Middle East & Africa, most significantly Russia, which was primarily due to sustained momentum in recruitment and retention, as well as growth in North Latin America.

Ending Representatives decreased by 1%. The decrease in Ending Representatives at June 30, 2016 as compared to the prior-year period was primarily due to the impact of the deconsolidation of Venezuela, which had a negative impact of 3 points, and to a lesser extent, declines in Asia Pacific. These decreases were partially offset by growth in Europe, Middle East & Africa, most significantly Russia and South Africa, as well as growth in South Latin America.

See "Venezuela Discussion" in this MD&A and Note 1, Accounting Policies, to the consolidated financial statements included herein for further discussion of our Venezuela operations. See Note 3, Discontinued Operations, and Note 4, Related Parties, to the consolidated financial statements included herein for more information on New Avon.

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

	Three Months Ended June 30,				%/Point Change
	2016		2015		US$		Constant $
Beauty:
Skincare	$	417.6	$	451.2	(7	)%	4	%
Fragrance	361.4		394.9		(8	)	5
Color	254.3		270.6		(6	)	6
Total Beauty	1,033.3		1,116.7		(7	)	5
Fashion & Home:
Fashion	217.0		225.6		(4	)	6
Home	149.2		169.4		(12	)	3
Total Fashion & Home	366.2		395.0		(7	)	5
Net sales from reportable segments	$	1,399.5	$	1,511.7	(7	)	5
Net sales from Other operating segments and business activities	—		32.8		(100	)	(100	)
Net sales	$	1,399.5	$	1,544.5	(9	)	2

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

Operating Margin

Operating margin and Adjusted operating margin increased 90 basis points and 100 basis points, respectively, compared to the same period of 2015. The increases in operating margin and Adjusted operating margin are discussed further below in "Gross Margin" and "Selling, General and Administrative Expenses."

Gross Margin

Gross margin and Adjusted gross margin decreased 40 basis points and 70 basis points, respectively, compared to the same period of 2015. The gross margin comparison was impacted by approximately 40 basis points in the prior year by the

33

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

devaluation of the Venezuelan currency in conjunction with highly inflationary accounting, as approximately $6 was recognized in the prior-year period associated with carrying certain non-monetary assets at the historical U.S. dollar cost following a devaluation. See "Venezuela Discussion" in this MD&A for a further discussion of our Venezuela operations.

The remaining decrease in gross margin and the decrease of 70 basis points in Adjusted gross margin was primarily due to the following:

• a decrease of approximately 290 basis points due to the unfavorable impact of foreign currency transaction losses and foreign currency translation; and

• a decrease of 40 basis points due to sales of products to New Avon since the separation of the Company's North America business into New Avon on March 1, 2016.

These items were partially offset by the following:

• an increase of 150 basis points due to the favorable net impact of mix and pricing, which includes the realization of price increases in Argentina, which is a market experiencing relatively high inflation; and

• an increase of 110 basis points due to lower supply chain costs, primarily from lower material costs and cost savings initiatives in Europe, Middle East & Africa.

See Note 4, Related Parties, to the consolidated financial statements included herein for more information on New Avon.

Selling, General and Administrative Expenses

Selling, general and administrative expenses as a percentage of revenue and Adjusted selling, general, and administrative expenses as a percentage of revenue decreased 120 basis points and 170 basis points, respectively, compared to the same period of 2015. The selling, general and administrative expenses as a percentage of revenue comparison was impacted by approximately 40 basis points in the prior year by higher CTI restructuring and the $1 negative impact associated with our Venezuela operations for certain non-monetary assets carried at the historical U.S. dollar cost following the devaluation of the Venezuelan currency in conjunction with highly inflationary accounting. See "Venezuela Discussion" in this MD&A for a further discussion of our Venezuela operations and Note 12, Restructuring Initiatives, to the consolidated financial statements included herein for more information on CTI restructuring.

The remaining decrease in selling, general and administrative expenses as a percentage of revenue and the decrease of 170 basis points in Adjusted selling, general and administrative expenses as a percentage of revenue were primarily due to the following:

• a decrease of 280 basis points primarily due to the impact of our Constant $ revenue growth with respect to our fixed expenses. In addition, lower fixed expenses, primarily resulting from our costs savings initiatives, mainly reductions in headcount, were largely offset by the inflationary impact on our expenses; and

• a decrease of 30 basis points from lower advertising expense, primarily in Europe, Middle East & Africa.

These items were partially offset by the following:

• an increase of approximately 60 basis points due to the unfavorable impact of foreign currency translation and foreign currency transaction losses;

• an increase of 30 basis points from higher bad debt expense, primarily in South Latin America; and

• various other insignificant items that partially offset the decrease in selling, general and administrative expenses and Adjusted selling, general and administrative expenses as a percentage of revenue.

Other Expense

Interest expense increased by approximately $3 compared to the prior-year period, primarily due to the increase in the interest rates on the 2013 Notes (defined below) as a result of the downgrades of our long-term credit ratings, partially offset by lower outstanding debt balances.

Interest income increased by approximately $2 compared to the prior-year period.

Other (income) expense, net, was income of approximately $5 in the current-year period as compared to expense of approximately $1 in the prior-year period, primarily due to higher gains on foreign exchange compared to the prior-year period.

Effective Tax Rate

The effective tax rate in 2016 was impacted by a net benefit of approximately $7 primarily due to the release of a valuation allowance associated with Russia, partially offset by CTI restructuring. The effective tax rate in 2015 was negatively impacted

34

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

by the devaluation of the Venezuelan currency in conjunction with highly inflationary accounting and CTI restructuring, partially offset by the benefit from a partial release of a valuation allowance against deferred tax assets of approximately $3, which was due to the weakening of the U.S. dollar against currencies of some of our key markets.

The effective tax rates and the Adjusted effective tax rates in 2016 and 2015 were negatively impacted by the country mix of earnings and the inability to recognize additional deferred tax assets in various jurisdictions related to our current-year operating results.

See "Venezuela Discussion" in this MD&A and Note 1, Accounting Policies, to the consolidated financial statements included herein for further discussion of our Venezuela operations, and Note 12, Restructuring Initiatives, to the consolidated financial statements included herein for more information on CTI restructuring.

Discontinued Operations

Loss from discontinued operations, net of tax was $3 compared to income of $1 for 2015. During the second quarter of 2016, we recorded a charge of approximately $1 before tax ($1 after tax) associated with the sale of the North America business which closed on March 1, 2016. See Note 3, Discontinued Operations, to the consolidated financial statements included herein for more information.

Impact of Foreign Currency

During the second quarter of 2016, foreign currency had a significant impact on our financial results. Specifically, 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 selling, general and administrative expenses), which had an unfavorable impact to operating profit and Adjusted operating profit of an estimated $45, or approximately 280 basis points to operating margin and Adjusted operating margin;

• foreign currency translation, which had an unfavorable impact to operating profit and Adjusted operating profit of approximately $25, or approximately 70 basis points to operating margin and Adjusted operating margin; and

• foreign exchange gains on our working capital (classified within other expense, net), which had a favorable impact of approximately $3 before tax.

Six Months Ended June 30, 2016

Revenue

During the six months ended June 30, 2016, revenue declined 12% compared to the prior-year period, primarily due to unfavorable foreign exchange, while Constant $ revenue increased 3%. The Constant $ revenue comparison was negatively impacted by approximately 1 point as a result of the sale of Liz Earle, which was completed in July 2015. The Constant $ revenue comparison was also negatively impacted by an estimated 1 point due to the IPI tax on cosmetics in Brazil that went into effect in May 2015. The Constant $ revenue comparison also benefited from sales of products to New Avon since the separation of the Company's North America business into New Avon on March 1, 2016, which was partially offset by the impact of the deconsolidation of Venezuela. In addition, our Constant $ revenue benefited from growth in Europe, Middle East & Africa, most significantly Russia, and to a lesser extent, South Africa. Constant $ revenue benefited from higher average order, which was partially offset by a decrease in Active Representatives. The net impact of price and mix increased 7% as we have been improving our discipline of pricing with inflation, strategically pricing in certain markets and categories, and launching products at more advantageous price points, while managing the potential impact on unit sales. Units sold decreased 4%, primarily due to declines in units sold in Brazil and Mexico and the impact of the deconsolidation of Venezuela, partially offset by an increase in units sold in Russia. The decrease in Active Representatives was primarily due to the impact of the deconsolidation of Venezuela and declines in South Latin America, primarily Brazil, and Asia Pacific. These declines in Active Representatives were partially offset by growth in Europe, Middle East & Africa, most significantly Russia, which was primarily due to sustained momentum in recruitment and retention.

See "Venezuela Discussion" in this MD&A and Note 1, Accounting Policies, to the consolidated financial statements included herein for further discussion of our Venezuela operations. See Note 3, Discontinued Operations, and Note 4, Related Parties, to the consolidated financial statements included herein for more information on New Avon.

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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 net sales from reportable segments and associated growth rates were as follows:

	Six Months Ended June 30,				%/Point Change
	2016		2015		US$		Constant $
Beauty:
Skincare	$	780.2	$	896.9	(13	)%	1	%
Fragrance	693.2		782.3		(11	)	4
Color	500.3		560.5		(11	)	4
Total Beauty	1,973.7		2,239.7		(12	)	3
Fashion & Home:
Fashion	413.7		439.4		(6	)	7
Home	278.5		330.3		(16	)	2
Total Fashion & Home	692.2		769.7		(10	)	5
Net sales from reportable segments	$	2,665.9	$	3,009.4	(11	)	3
Net sales from Other operating segments and business activities	13.6		68.0		(80	)	(83	)
Net sales	$	2,679.5	$	3,077.4	(13	)	3

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

Operating Margin

Operating margin increased 200 basis points, while Adjusted operating margin decreased 60 basis points, compared to the same period of 2015. The increase in operating margin and decrease in Adjusted operating margin are discussed further below in "Gross Margin" and "Selling, General and Administrative Expenses."

Gross Margin

Gross margin and Adjusted gross margin decreased 30 basis points and 90 basis points, respectively, compared to the same period of 2015. The gross margin comparison was impacted by approximately 70 basis points in the prior year by the devaluation of the Venezuelan currency in conjunction with highly inflationary accounting, as approximately $21 was recognized in the prior-year period associated with carrying certain non-monetary assets at the historical U.S. dollar cost following a devaluation. See "Venezuela Discussion" in this MD&A for a further discussion of our Venezuela operations.

The remaining decrease in gross margin and the decrease of 90 basis points in Adjusted gross margin was primarily due to the following:

• a decrease of approximately 340 basis points due to the unfavorable impact of foreign currency transaction losses and foreign currency translation; and

• a decrease of 30 basis points due to sales of products to New Avon since the separation of the Company's North America business into New Avon on March 1, 2016.

These items were partially offset by the following:

• an increase of 150 basis points due to the favorable net impact of mix and pricing, which includes the realization of price increases in Argentina, which is a market experiencing relatively high inflation; and

• an increase of 130 basis points due to lower supply chain costs, primarily from lower material costs in Europe, Middle East & Africa and South Latin America.

See Note 4, Related Parties, to the consolidated financial statements included herein for more information on New Avon.

Selling, General and Administrative Expenses

Selling, general and administrative expenses as a percentage of revenue and Adjusted selling, general, and administrative expenses as a percentage of revenue decreased 230 basis points and 30 basis points, respectively, compared to the same period of 2015. The selling, general and administrative expenses as a percentage of revenue comparison was impacted by approximately 200 basis points in the prior year by the devaluation of the Venezuelan currency in conjunction with highly inflationary accounting, primarily as an approximate $90 impairment charge was recognized in the prior-year period to reflect

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AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

the write-down of the long-lived assets to their estimated fair value following a devaluation, which was partially offset by lower CTI restructuring. See "Venezuela Discussion" in this MD&A for a further discussion of our Venezuela operations and Note 12, Restructuring Initiatives, to the consolidated financial statements included herein for more information on CTI restructuring.

The remaining decrease in selling, general and administrative expenses as a percentage of revenue and the decrease of 30 basis points in Adjusted selling, general and administrative expenses as a percentage of revenue was primarily due to the following:

• a decrease of 230 basis points primarily due to the impact of our Constant $ revenue growth with respect to our fixed expenses. In addition, lower fixed expenses, primarily resulting from our costs savings initiatives, mainly reductions in headcount, were largely offset by the inflationary impact on our expenses; and

• a decrease of 40 basis points from lower advertising expense, primarily in Europe, Middle East & Africa.

These items were partially offset by the following:

• an increase of approximately 110 basis points due to the unfavorable impact of foreign currency translation and foreign currency transaction losses;

• an increase of 40 basis points as a result of the IPI tax law on cosmetics in Brazil, which reduced revenue as we did not raise the prices paid by Representatives to the same extent as the IPI tax;

• an increase of 40 basis points from higher bad debt expense, primarily in Brazil; and

• various other insignificant items that partially offset the decrease in selling, general and administrative expenses and Adjusted selling, general and administrative expenses as a percentage of revenue.

Other Expense

Interest expense increased by approximately $7 compared to the prior-year period, primarily due to the increase in the interest rates on the 2013 Notes (defined below) as a result of the downgrades of our long-term credit ratings, partially offset by lower outstanding debt balances.

Interest income increased by approximately $3 compared to the prior-year period.

Other expense, net, increased by approximately $113 compared to the prior-year period, primarily due to the year-on-year impact the Venezuelan special items as we recorded a loss of approximately $120 in the first quarter of 2016 as compared to a benefit of approximately $4 in the first quarter of 2015. In addition, other expense, net was positively impacted by lower losses on foreign exchange compared to the prior-year period, partially offset by our proportionate share of New Avon's loss of approximately $5. See "Venezuela Discussion" in this MD&A for further discussion of our Venezuela operations. See Note 3, Discontinued Operations, to the consolidated financial statements included herein for more information on New Avon.

Effective Tax Rate

The effective tax rate in 2016 was impacted by the deconsolidation of our Venezuelan operations and CTI restructuring, partially offset by a benefit of approximately $29 as a result of the implementation of foreign tax planning strategies and a net benefit of approximately $7 primarily due to the release of a valuation allowance associated with Russia. The effective tax rate in 2015 was negatively impacted by an additional valuation allowance for deferred tax assets of approximately $31 in the U.S., which was recorded in the first quarter of 2015, partially offset by a partial release of a valuation allowance against deferred tax assets of approximately $3 which was recorded in the second quarter of 2015. The additional valuation allowance was due to the strengthening of the U.S. dollar against currencies of some of our key markets and its associated effect on our tax planning strategies. The partial release of the valuation allowance was due to the weakening of the U.S. dollar against currencies of some of our key markets. The effective tax rate in 2015 was also negatively impacted by the devaluation of the Venezuelan currency in conjunction with highly inflationary accounting and CTI restructuring.

The effective tax rates and the Adjusted effective tax rates in 2016 and 2015 were negatively impacted by the country mix of earnings and the inability to recognize additional deferred tax assets in various jurisdictions related to our current-year operating results.

See "Venezuela Discussion" in this MD&A and Note 1, Accounting Policies, to the consolidated financial statements included herein for further discussion of our Venezuela operations, and Note 12, Restructuring Initiatives, to the consolidated financial statements included herein for more information on CTI restructuring.

Discontinued Operations

Loss from discontinued operations, net of tax was $12 compared to $3 for 2015. During the first half of 2016, we recorded charges of approximately $16 before tax ($6 after tax) in the aggregate associated with the sale of the North America business

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AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

which closed on March 1, 2016. See Note 3, Discontinued Operations, to the consolidated financial statements included herein for more information.

Impact of Foreign Currency

During the first half of 2016, foreign currency had a significant impact on our financial results. Specifically, 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 selling, general and administrative expenses), which had an unfavorable impact to operating profit and Adjusted operating profit of an estimated $115, or approximately 360 basis points to operating margin and Adjusted operating margin;

• foreign currency translation, which had an unfavorable impact to operating profit of approximately $50 and Adjusted operating profit of approximately $55, or approximately 100 basis points to operating margin and approximately 90 basis points to Adjusted operating margin; and

• lower foreign exchange losses on our working capital (classified within other expense, net), which had a favorable impact of approximately $8 before tax and $13 before tax on an Adjusted basis.

Venezuela Discussion

Avon Venezuela operates in the direct-selling channel offering Beauty and Fashion & Home products. Avon Venezuela has a manufacturing facility that produces the Beauty products that it sells. Avon Venezuela imports many of its Fashion & Home products and raw materials and components needed to manufacture its Beauty products.

Currency restrictions enacted by the Venezuelan government since 2003 have impacted the ability of Avon Venezuela to obtain foreign currency to pay for imported products. In 2010, we began accounting for our operations in Venezuela under accounting guidance associated with highly inflationary economies. Under U.S. GAAP, the financial statements of a foreign entity operating in a highly inflationary economy are required to be remeasured as if the functional currency is the company’s reporting currency, the U.S. dollar. This generally results in translation adjustments, caused by changes in the exchange rate, being reported in earnings currently for monetary assets (e.g., cash, accounts receivable) and liabilities (e.g., accounts payable, accrued expenses) and requires that different procedures be used to translate non-monetary assets (e.g., inventories, fixed assets). Non-monetary assets and liabilities are remeasured at the historical U.S. dollar cost basis. This diverges significantly from the application of accounting rules prior to designation as highly inflationary accounting, where such gains and losses would have been recognized only in other comprehensive income (loss) (shareholders' deficit).

Venezuela's restrictive foreign exchange control regulations and our Venezuelan operations' increasingly limited access to U.S. dollars have resulted in an other-than-temporary lack of exchangeability between the Venezuelan bolivar and the U.S. dollar, and have restricted our Venezuelan operations' ability to pay dividends and settle intercompany obligations. The severe currency controls imposed by the Venezuelan government have significantly limited our ability to realize the benefits from earnings of our Venezuelan operations and access the resulting liquidity provided by those earnings. We expected that this other-than-temporary lack of exchangeability would continue for the foreseeable future, and as a result, we concluded that, effective March 31, 2016, we did not meet the accounting criteria of control in order to continue consolidating our Venezuelan operations and, as a result, account for our Venezuelan operations using the cost method of accounting. Our Consolidated Balance Sheets no longer includes the assets and liabilities of our Venezuelan operations and we no longer include the results of our Venezuelan operations in our Consolidated Financial Statements and will include income relating to our Venezuelan operations only to the extent that we receive cash for dividends or royalties remitted by Avon Venezuela.

As a result of the change to the cost method of accounting, in the first quarter of 2016 we recorded a loss of approximately $120 in other expense, net. The loss was comprised of approximately $39 in net assets of the Venezuelan business and approximately $81 in accumulated foreign currency translation adjustments within AOCI associated with foreign currency movements before Venezuela was accounted for as a highly inflationary economy. The net assets of the Venezuelan business were comprised of inventories of approximately $24, property, plant and equipment, net of approximately $15, other assets of approximately $11, cash of approximately $5, accounts receivable of approximately $4, and accounts payable and accrued liabilities of approximately $20.

In February 2015, the Venezuelan government announced that a new foreign exchange system was created, referred to as the SIMADI exchange ("SIMADI"). SIMADI began operating on February 12, 2015. There were multiple legal mechanisms in Venezuela to exchange currency. As SIMADI represented the rate which better reflected the economics of Avon Venezuela's business activity, in comparison to the other available exchange rates, we concluded that we should utilize the SIMADI exchange rate to remeasure our Venezuelan operations effective February 12, 2015. As a result of the change to the SIMADI rate, which caused the devaluation of approximately 70% as compared to the exchange rate we had used previously, we

38

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

recorded an after-tax benefit of approximately $3 (a benefit of approximately $4 in other expense, net, and a loss of approximately $1 in income taxes) in the first quarter of 2015, primarily reflecting the write-down of net monetary assets.

Additionally, certain non-monetary assets were carried at their historical U.S. dollar cost subsequent to the devaluation. Therefore, these costs impacted the income statement during 2015 at a disproportionate rate as they were not devalued based on the new exchange rates, but were expensed at their historical U.S. dollar value. As a result of using the historical U.S. dollar cost basis of non-monetary assets, such as inventories, these assets continued to be remeasured, following the change to the SIMADI rate, at the applicable rate at the time of their acquisition. As a result, we determined that an adjustment of approximately $11 to cost of sales was needed to reflect certain non-monetary assets at their net realizable value, which was recorded in the first quarter of 2015. We recognized an additional negative impact of approximately $11 to operating profit and net income relating to these non-monetary assets in the first and second quarters of 2015.

In addition, at February 12, 2015, we reviewed Avon Venezuela's long-lived assets to determine whether the carrying amount of the assets was recoverable. Based on our expected cash flows associated with the asset group, we determined that the carrying amount of the assets, carried at their historical U.S. dollar cost basis, was not recoverable. As such, an impairment charge of approximately $90 to selling, general and administrative expenses was needed to reflect the write-down of the long-lived assets to estimated fair value of approximately $16, which was recorded in the first quarter of 2015.

Segment Review

We determine segment profit by deducting the related costs and expenses from segment revenue. In order to ensure comparability between periods, segment profit includes an allocation of global marketing expenses based on actual revenues. Segment profit excludes global expenses other than marketing, CTI restructuring initiatives, certain significant asset impairment charges, and other items, which are not allocated to a particular segment, if applicable. This is consistent with the manner in which we assess our performance and allocate resources. See Note 10, Segment Information, to the consolidated Financial statements for a reconciliation of segment profit to operating profit.

	Three Months Ended June 30,
	2016				2015
	Total revenue		Segment profit		Total revenue		Segment profit
Europe, Middle East & Africa	$	520.9	$	83.4	$	530.1	$	73.2
South Latin America	535.7		61.0		607.5		69.2
North Latin America	224.4		32.1		236.0		31.6
Asia Pacific	141.9		14.8		158.0		16.5
Total from reportable segments	$	1,422.9	$	191.3	$	1,531.6	$	190.5

	Six Months Ended June 30,
	2016				2015
	Total revenue		Segment profit		Total revenue		Segment profit
Europe, Middle East & Africa	$	1,041.3	$	152.1	$	1,062.3	$	137.1
South Latin America	962.1		84.1		1,198.4		136.9
North Latin America	429.1		60.6		465.3		60.2
Asia Pacific	278.6		29.5		322.1		38.7
Total from reportable segments	$	2,711.1	$	326.3	$	3,048.1	$	372.9

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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,
							%/Point Change										%/Point Change
	2016			2015			US$		Constant $		2016			2015			US$		Constant $
Total revenue	$	520.9		$	530.1		(2	)%	7	%	$	1,041.3		$	1,062.3		(2	)%	9	%
Segment profit	83.4			73.2			14	%	28	%	152.1			137.1			11	%	29	%
Segment margin	16.0		%	13.8		%	2.2		2.5		14.6		%	12.9		%	1.7		2.2
Change in Active Representatives									4	%									6	%
Change in units sold									2	%									5	%
Change in Ending Representatives									6	%									6	%

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

Three Months Ended June 30, 2016

Total revenue decreased 2% compared to the prior-year period, primarily due to the unfavorable impact from foreign exchange, most significantly the strengthening of the U.S. dollar relative to the Russian ruble and South African Rand. On a Constant $ basis, revenue grew 7%, primarily driven by Russia and South Africa. The increase in Active Representatives drove the region's Constant $ revenue growth, while average order also increased. The increase in Ending Representatives was driven primarily by growth in Russia and South Africa, partially offset by a decline in the United Kingdom.

In Russia, revenue decreased 7%, which was unfavorably impacted by foreign exchange. On a Constant $ basis, Russia's revenue grew 15%, primarily due to an increase in Active Representatives, which continued to benefit from sustained momentum in recruiting and retention, and higher average order, which was driven by pricing. In the United Kingdom, revenue declined 7%, which was unfavorably impacted by foreign exchange. On a Constant $ basis, the United Kingdom's revenue was relatively unchanged, as a decrease of Active Representatives was offset by higher average order. The increase in the United Kingdom's average order was primarily the result of strength in Beauty. In South Africa, revenue grew 1%, despite being unfavorably impacted by foreign exchange. On a Constant $ basis, South Africa’s revenue grew 27%, due to an increase in Active Representatives, as well as higher average order.

Segment margin increased 2.2 points, or 2.5 points on a Constant $ basis, primarily as a result of:

• a net benefit of 1.3 points primarily due to the Constant $ revenue growth with respect to our fixed expenses;

• a benefit of .9 points due to lower advertising expense, primarily in Russia; and

• a benefit of .4 points due to higher gross margin caused primarily by a benefit of 1.7 points due to lower supply chain costs, including benefits from lower material costs and cost savings initiatives. The net impact of mix and pricing also benefited gross margin by 1.1 points which was primarily driven by Russia. These were partially offset by an estimated 2 points from the unfavorable impact of foreign currency transaction losses.

Six Months Ended June 30, 2016

Total revenue decreased 2% compared to the prior-year period, primarily due to the unfavorable impact from foreign exchange, most significantly the strengthening of the U.S. dollar relative to the Russian ruble and South African Rand. On a Constant $ basis, revenue grew 9%, primarily driven by Russia and South Africa. The increase in Active Representatives drove the region's Constant $ revenue growth, while average order also increased.

In Russia, revenue decreased 1%, which was unfavorably impacted by foreign exchange. On a Constant $ basis, Russia's revenue grew 21%, primarily due to an increase in Active Representatives, which continued to benefit from sustained momentum in recruiting and retention, and higher average order, which was driven by pricing. In the United Kingdom, revenue declined 5%, which was unfavorably impacted by foreign exchange. On a Constant $ basis, the United Kingdom's revenue grew 1%, primarily due to higher average order which was partially offset by a decrease in Active Representatives. In South Africa, revenue declined 3%, which was unfavorably impacted by foreign exchange. On a Constant $ basis, South Africa’s revenue grew 26%, due to an increase in Active Representatives, as well as higher average order.

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AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

Segment margin increased 1.7 points, or 2.2 points on a Constant $ basis, primarily as a result of:

• a net benefit of 1.8 points primarily due to the Constant $ revenue growth with respect to our fixed expenses;

• a benefit of .9 points due to lower advertising expense, primarily in Russia; and

• a decline of .7 points due to lower gross margin caused primarily by an estimated 4 points from the unfavorable impact of currency transaction losses. This was partially offset by a benefit of 1.6 points due to lower supply chain costs, including benefits from lower material costs and cost savings initiatives. The net impact of mix and pricing also benefited gross margin by 1.2 points which was primarily driven by Russia.

South Latin America

	Three Months Ended June 30,										Six Months Ended June 30,
							%/Point Change										%/Point Change
	2016			2015			US$		Constant $		2016			2015			US$		Constant $
Total revenue	$	535.7		$	607.5		(12	)%	5	%	$	962.1		$	1,198.4		(20	)%	2	%
Segment profit	61.0			69.2			(12	)%	6	%	84.1			136.9			(39	)%	(23	)%
Segment margin	11.4		%	11.4		%	—		.1		8.7		%	11.4		%	(2.7	)	(2.7	)
Change in Active Representatives									—	%									(2	)%
Change in units sold									(2	)%									(7	)%
Change in Ending Representatives									1	%									1	%

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

Three Months Ended June 30, 2016

Total revenue decreased 12% compared to the prior-year period, due to the unfavorable impact from foreign exchange which was primarily driven by the strengthening of the U.S. dollar relative to the Brazilian real and the Argentine Peso. On a Constant $ basis, revenue increased 5%. The region's Constant $ revenue growth was negatively impacted by an estimated 2 points from additional Value Added Tax ("VAT") state taxes in Brazil that were implemented in late 2015. In addition, an IPI tax law on cosmetics in Brazil that went into effect in May 2015 caused an estimated 1 point negative impact on the region's Constant $ revenue growth. The region's Constant $ revenue benefited from higher average order, which was driven by pricing. The region's Constant $ revenue and higher average order benefited from relatively high inflation in Argentina, as this market's results were impacted by the inflationary impact on pricing. Revenue in Argentina decreased 23%, unfavorably impacted by foreign exchange. On a Constant $ basis, Argentina's revenue grew 23% which was primarily due to higher average order, partially offset by a decrease in Active Representatives. Argentina contributed approximately 3 points to the region's Constant $ revenue growth, and approximately 1 point to Avon's consolidated Constant $ revenue growth. The increase in Ending Representatives was primarily driven by an increase in Brazil.

Revenue in Brazil decreased 10%, unfavorably impacted by foreign exchange. Brazil’s Constant $ revenue increased 2%, despite a continued difficult economic environment, and was primarily due to higher average order, which was driven by pricing. Constant $ revenue in Brazil was negatively impacted by an estimated 4 points from the additional VAT state taxes discussed above. In addition, Brazil's Constant $ revenue was negatively impacted by an estimated 2 points due to the impact of the IPI tax discussed above, and a decrease in Active Representatives. On a Constant $ basis, Brazil’s sales from Beauty products increased 2%, as benefits from pricing were partially offset by the negative impact of the additional state taxes and the IPI tax. The additional VAT state taxes and the IPI tax also negatively impacted Brazil's Beauty units, as we increased prices to partially offset the taxes. On a Constant $ basis, Brazil's sales from Fashion & Home products decreased 1%.

Segment margin was relatively unchanged, or increased .1 point on a Constant $ basis, primarily as a result of:

• a benefit of .8 points primarily due to the Constant $ revenue growth with respect to our fixed expenses;

• a benefit of .6 points from lower net brochure costs, primarily in Brazil;

• a benefit of .3 points from lower distribution costs, primarily due to cost savings initiatives;

• a decline of 1.1 points from gross margin caused by an estimated 4 points from the unfavorable impact of currency transaction losses, partially offset by 2.0 points from the favorable net impact of mix and pricing and .8 points from

41

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

lower supply chain costs, including benefits from cost savings initiatives. The favorable net impact of mix and pricing includes the realization of price increases ahead of inflation in Argentina;

• a decline of .7 points from higher bad debt expense, primarily due to the macroeconomic environment in Brazil and Argentina;

• a decline of .4 points as a result of the IPI tax law on cosmetics in Brazil, which are a reduction of revenue and we have not raised the prices paid by Representatives to the same extent as the IPI tax; and

• various other insignificant items that benefited segment margin.

Six Months Ended June 30, 2016

Total revenue decreased 20% compared to the prior-year period, due to the unfavorable impact from foreign exchange which was primarily driven by the strengthening of the U.S. dollar relative to most currencies in this segment. On a Constant $ basis, revenue increased 2%. The IPI tax in Brazil has caused an estimated 3 point negative impact on the region's Constant $ revenue growth. The region's Constant $ revenue growth was also negatively impacted by an estimated 1 point from additional VAT state taxes in Brazil that were implemented in late 2015. The region's Constant $ revenue benefited from higher average order, which was driven by pricing, and was partially offset by a decrease in Active Representatives. The region's Constant $ revenue and higher average order benefited from relatively high inflation in Argentina, as this market's results were impacted by the inflationary impact on pricing. Revenue in Argentina decreased 24%, unfavorably impacted by foreign exchange. On a Constant $ basis, Argentina's revenue grew 23% which was primarily due to higher average order, partially offset by a decrease in Active Representatives. Argentina contributed approximately 3 points to the region's Constant $ revenue growth, and approximately 1 point to Avon's consolidated Constant $ revenue growth.

Revenue in Brazil decreased 22%, unfavorably impacted by foreign exchange. Brazil’s Constant $ revenue decline of 2% was negatively impacted by an estimated 5 points due to the impact of the IPI tax discussed above. Constant $ revenue in Brazil was also negatively impacted by an estimated 3 points from the additional VAT state taxes discussed above. The negative impact of the IPI tax, the additional VAT state taxes and a decrease in Active Representatives was partially offset by higher average order, which was driven by pricing. In addition, Brazil continued to be impacted by a difficult economic environment. On a Constant $ basis, Brazil’s sales from Beauty products also decreased 4%, negatively impacted by the IPI tax. The IPI tax and additional VAT state taxes also negatively impacted Brazil's Beauty units, as we increased prices to partially offset the taxes. On a Constant $ basis, Brazil's sales from Fashion & Home products decreased 3%.

Segment margin decreased 2.7 points on both a reported and Constant $ basis, primarily as a result of:

• a decline of 1.5 points from gross margin caused by an estimated 5 points from the unfavorable impact of currency transaction losses, partially offset by 2.0 points from the favorable net impact of mix and pricing and 1.2 points from lower supply chain costs. The favorable net impact of mix and pricing includes the realization of price increases ahead of inflation in Argentina. Supply chain costs benefited primarily as a result of lower material costs;

• a decline of 1.4 points as a result of the IPI tax law on cosmetics in Brazil, which are a reduction of revenue and we have not raised the prices paid by Representatives to the same extent as the IPI tax;

• a decline of 1.1 points from higher bad debt expense, primarily due to the macroeconomic environment in Brazil and Argentina;

• a benefit of .4 points primarily due to the Constant $ revenue growth with respect to our fixed expenses;

• a benefit of .3 points from lower net brochure costs, primarily in Brazil; and

• various other insignificant items that partially offset the decline in segment margin.

Argentina Discussion

In 2011, the Argentine government introduced restrictive foreign currency exchange controls. In December 2015, the Argentine government began the process of removing foreign currency exchange controls and, beginning in the first quarter of 2016, Avon Argentina has been able to adequately access foreign currencies, including the U.S. dollar, in order to pay a substantial portion of its non-functional currency obligations.

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AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

North Latin America

	Three Months Ended June 30,										Six Months Ended June 30,
							%/Point Change										%/Point Change
	2016			2015			US$		Constant $		2016			2015			US$		Constant $
Total revenue	$	224.4		$	236.0		(5	)%	6	%	$	429.1		$	465.3		(8	)%	4	%
Segment profit	32.1			31.6			2	%	15	%	60.6			60.2			1	%	16	%
Segment margin	14.3		%	13.4		%	.9		1.1		14.1		%	12.9		%	1.2		1.4
Change in Active Representatives									4	%									—	%
Change in units sold									(6	)%									(5	)%
Change in Ending Representatives									—	%									—	%

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

Three Months Ended June 30, 2016

North Latin America consists largely of our Mexico business. Total revenue for the region decreased 5% compared to the prior-year period, due to the unfavorable impact from foreign exchange which was primarily driven by the strengthening of the U.S. dollar relative to the Mexican peso. On a Constant $ basis, revenue increased 6%, which benefited from an increase in Active Representatives and higher average order. Revenue in Mexico decreased 8%, unfavorably impacted by foreign exchange. On a Constant $ basis, Mexico's revenue grew 7%, primarily due to higher average order, as well as an increase in Active Representatives. Mexico's higher average order benefited primarily from pricing, partially offset by a decline in units sold, and Active Representatives benefited from improved onboarding and retention.

Segment margin increased .9 points, or 1.1 points on a Constant $ basis, primarily as a result of:

• a benefit of 1.6 points from higher gross margin caused primarily by a benefit of 2.8 points from the favorable impact of mix and pricing and .4 points from lower supply chain costs, partially offset by 1.6 points from the unfavorable impact of foreign currency transaction losses; and

• a decline of .9 points due to higher advertising expense, primarily in Mexico to support new product launches.

Six Months Ended June 30, 2016

Total revenue decreased 8% compared to the prior-year period, due to the unfavorable impact from foreign exchange which was primarily driven by the strengthening of the U.S. dollar relative to the Mexican peso. On a Constant $ basis, revenue increased 4%, which benefited from higher average order. Revenue in Mexico decreased 12%, unfavorably impacted by foreign exchange. On a Constant $ basis, Mexico's revenue grew 5%, primarily due to higher average order which benefited primarily from pricing, partially offset by a decline in units sold. Mexico's Active Representatives benefited from improved onboarding and retention.

Segment margin increased 1.2 points, or 1.4 points on a Constant $ basis, primarily as a result of a benefit of 1.5 points from higher gross margin. Higher gross margin was caused primarily by a benefit of 2.3 points from the favorable impact of mix and pricing and 1.2 points from lower supply chain costs, partially offset by 1.7 points from the unfavorable impact of foreign currency transaction losses.

43

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

Asia Pacific

	Three Months Ended June 30,										Six Months Ended June 30,
							%/Point Change										%/Point Change
	2016			2015			US$		Constant $		2016			2015			US$		Constant $
Total revenue	$	141.9		$	158.0		(10	)%	(5	)%	$	278.6		$	322.1		(14	)%	(7	)%
Segment profit	14.8			16.5			(10	)%	(2	)%	29.5			38.7			(24	)%	(15	)%
Segment margin	10.4		%	10.4		%	—		.3		10.6		%	12.0		%	(1.4	)	(1.0	)
Change in Active Representatives									(8	)%									(9	)%
Change in units sold									(4	)%									(6	)%
Change in Ending Representatives									(4	)%									(4	)%

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

Three Months Ended June 30, 2016

Total revenue decreased 10% compared to the prior-year period, partially due to the unfavorable impact from foreign exchange. On a Constant $ basis, revenue decreased 5%, due to declines in most markets. The region's Constant $ revenue decline was primarily due to a decrease in Active Representatives, partially offset by higher average order. The segment's Active Representatives decline was impacted by a reduction in the number of sales campaigns in the Philippines. The decrease in Ending Representatives was driven by declines in most markets, partially offset by an increase in the Philippines. Revenue in the Philippines increased 1%, or 6% on a Constant $ basis, primarily due to higher average order, partially offset by a decrease in Active Representatives. The timing of the Easter holiday also benefited revenue in the Philippines.

Segment margin was relatively unchanged, or increased .3 points on a Constant $ basis, primarily as a result of:

• a net benefit of .5 points from lower fixed expenses, partially offset by the unfavorable impact of declining revenue with respect to our fixed expenses;

• a benefit of .4 points from lower transportation costs;

• a decline of .6 points from higher bad debt expense, primarily in the Philippines;

• a decline of .4 points due to lower gross margin caused primarily by 1.2 points from the unfavorable impact of mix and pricing and .6 points from the unfavorable impact of foreign currency transaction losses. These impacts were partially offset by 1.5 points from lower supply chain costs; and

• various other insignificant items that benefited segment margin.

We are evaluating strategic alternatives for China.

Six Months Ended June 30, 2016

Total revenue decreased 14% compared to the prior-year period, partially due to the unfavorable impact from foreign exchange. On a Constant $ basis, revenue decreased 7%, due to declines in most markets, led by China which declined 41%, or 38% on a Constant $ basis. The region's Constant $ revenue decline was primarily due to a decrease in Active Representatives, partially offset by higher average order. The segment's Active Representatives decline was impacted by a reduction in the number of sales campaigns in the Philippines. Revenue in the Philippines decreased 3%, but grew 3% on a Constant $ basis, primarily due to higher average order, partially offset by a decrease in Active Representatives.

Segment margin declined 1.4 points, or 1.0 point on a Constant $ basis, primarily as a result of:

• a decline of .6 points due to lower gross margin caused primarily due by 1.0 point from the unfavorable impact of mix and pricing and .7 points from the unfavorable impact of foreign currency transaction losses. These items were partially offset by 1.1 points from lower supply chain costs;

• a decline of .6 points due to the net impact of declining revenue with respect to Representative, sales leader and field expense;

• a net decline of .5 points from the unfavorable impact of declining revenue with respect to our fixed expenses, partially offset by lower fixed expenses;

• a decline of .4 points due to higher bad debt expense, primarily in the Philippines;

44

AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

• a benefit of .6 points due to lower advertising expense, primarily in China; and

• a benefit of .3 points from lower transportation costs.

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. At June 30, 2016, we had cash and cash equivalents totaling approximately $742. We believe that our sources of funding will be sufficient to satisfy our currently anticipated cash requirements through at least the next twelve months. For more information with respect to currency restrictions, see "Segment Review - South Latin America" in this MD&A above, and "Risk Factors - We are subject to financial risks related to our international operations, including exposure to foreign currency fluctuations and the impact of foreign currency restrictions" contained in our 2015 Form 10-K.

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 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 in 2015 and 2016, 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 in 2015, 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 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 2015 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 8, 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

Net Cash Used by Continuing Operating Activities

Net cash used by continuing operating activities during the first six months of 2016 was approximately $130, as compared to approximately $107 during the first six months of 2015. The approximate $23 increase to net cash used by continuing operating activities was primarily due to lower cash-related earnings, which were impacted by the unfavorable impact of foreign currency, timing of payments, primarily for inventory, and the contribution to the U.S. pension plan in 2016 of $20, which did not occur in 2015. These items were partially offset by the $67 payment to the U.S. Securities and Exchange Commission in connection with the FCPA settlement in 2015, which did not occur in 2016.

Net Cash Used by Continuing Investing Activities

Net cash used by continuing investing activities during the first six months of 2016 was approximately $44, as compared to approximately $47 during the first six months of 2015.

Net Cash Provided (Used) by Continuing Financing Activities

Net cash provided by continuing financing activities during the first six months of 2016 was approximately $413, as compared to net cash used by continuing financing activities of approximately $59 during the first six months of 2015. The approximately $472 increase to net cash provided (used) by continuing financing activities was primarily due to the net proceeds from the sale of Series C Preferred Stock and the suspension of our dividend. See Note 7, Series C Convertible Preferred Shares, to the consolidated financial statements included herein for more information.

We have not declared a quarterly dividend for the first six months of 2016, compared to a dividend of $.12 per share for the first six months of 2015.

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AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

Free Cash Flow

We define free cash flow as net cash provided (used) by operating activities of continuing operations less capital expenditures. Free cash flow for the full year 2016 is estimated to be at least approximately $50 to $75.

Capital Resources

Revolving Credit Facility

In June 2015, the Company and Avon International Operations, Inc., a wholly-owned domestic subsidiary of the Company (“AIO”), entered into a five-year $400.0 senior secured revolving credit facility (the “2015 facility”). Borrowings under the 2015 facility bear interest, at our option, at a rate per annum equal to LIBOR plus 250 basis points or a floating base rate plus 150 basis points, in each case subject to adjustment based upon a leverage-based pricing grid. As of June 30, 2016, there were no amounts outstanding under the 2015 facility.

All obligations of AIO under the 2015 facility are (i) unconditionally guaranteed by each material domestic restricted subsidiary of the Company (other than AIO, the borrower), in each case, subject to certain exceptions and (ii) guaranteed on a limited recourse basis by the Company. The obligations of AIO and the guarantors are secured by first priority liens on and security interest in substantially all of the assets of AIO and the subsidiary guarantors and by certain assets of the Company, in each case, subject to certain exceptions.

The 2015 facility will terminate in June 2020; provided, however, that it shall terminate on the 91^st day prior to the maturity of the 2018 Notes (as defined below), the 4.20% Notes (as defined below), the 2019 Notes (as defined below) and the 4.60% Notes (as defined below), if on such 91^st day, the applicable notes are not redeemed, repaid, discharged, defeased or otherwise refinanced in full.

The 2015 facility contains affirmative and negative covenants, which are customary for secured financings of this type, as well as financial covenants (interest coverage and total leverage ratios). As of June 30, 2016, we were in compliance with our interest coverage and total leverage ratios under the 2015 facility. The amount of the facility available to be drawn down on is reduced by any standby letters of credit granted by AIO. AIO has issued approximately $38 of standby letters of credit. As of June 30, 2016, based on then applicable interest rates, approximately $335 could have been drawn down without violating any covenant. A continued decline in our business results (including the impact of any adverse foreign exchange movements and significant restructuring charges) may further reduce our borrowing capacity under the 2015 facility or cause us to be non-compliant with our interest coverage and total leverage ratios. If we were to be non-compliant with our interest coverage or total leverage ratio, we would no longer have access to our 2015 facility and our credit ratings may be downgraded. As of June 30, 2016, there were no amounts outstanding under the 2015 facility.

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; and $250.0 principal amount of 6.95% Notes due March 15, 2043 (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 with S&P and Moody's. As described in the indenture, the interest rates on the 2013 Notes increase by .25% for each one-notch downgrade below investment grade on each of our long-term credit ratings assigned to the 2013 Notes by S&P or Moody's. These adjustments are limited to a total increase of 2% above the respective interest rates in effect on the date of issuance of the 2013 Notes. As a result of the long-term credit rating downgrades by S&P and Moody's in 2014, 2015 and 2016, the interest rates on the 2013 Notes increased by a total of 2%, and as such, we have reached the maximum allowable increase in interest rates on these Notes, with the last .25% effective as of September 15, 2016.

At June 30, 2016, we also have outstanding $250.0 principal amount of our 5.75% Notes due March 1, 2018 (the "2018 Notes"); $250.0 principal amount of our 4.20% Notes due July 15, 2018 (the "4.20% Notes"); and $350.0 principal amount of our 6.50% Notes due March 1, 2019 (the "2019 Notes"), with interest on each series of these Notes payable semi-annually.

The indentures governing our outstanding notes described above contain certain customary covenants and customary events of default and cross-default provisions. Further, we would be required to make an offer to repurchase all of our outstanding notes described above, with the exception of our 4.20% Notes, at a price equal to 101% of their aggregate principal amount plus accrued and unpaid interest in the event Avon undergoes a change of control and, at such time, the outstanding notes are rated below investment grade.

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AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

Series C Preferred Stock

On March 1, 2016, we 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 and are payable at a rate of 1.25% per quarter (net of any dividends on the Company’s common stock and subject to increase up to a maximum rate of 5.00% per quarter if the Company breaches certain obligations). Except to the extent not otherwise previously paid by the Company, preferred dividends are payable on the seventh anniversary of the issuance date of the Series C Preferred Stock as and when declared by the Board of Directors and at the end of each quarter thereafter. For a description of additional terms of the Series C Preferred Stock, including the change of control put, see Note 7, Series C Convertible Preferred Stock, to the consolidated financial statements included herein.

Long-Term Credit Ratings

Our long-term credit ratings are Ba3 (Negative Outlook) for corporate family debt, and B1 (Negative Outlook) for senior unsecured debt, with Moody's; B (Stable Outlook) with S&P; and B+ (Negative Outlook) with Fitch, which are below investment grade. We do not believe these long-term credit ratings will have a material impact on our near-term liquidity. However, any rating agency reviews could result in a change in outlook or downgrade, which could further limit our access to new financing, particularly short-term financing, reduce our flexibility with respect to working capital needs, affect the market price of some or all of our outstanding debt securities, and likely result in an increase in financing costs, and less favorable covenants and financial terms under our financing arrangements. For more information, see "Risk Factors - A general economic downturn, a recession globally or in one or more of our geographic regions or markets, such as Russia, or sudden disruption in business conditions or other challenges may adversely affect our business, our access to liquidity and capital, and our credit ratings," "Risk Factors - Our credit ratings were downgraded in 2014, 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, and our working capital," and "Risk Factors - Our indebtedness could adversely affect us by reducing our flexibility to respond to changing business and economic conditions" contained in our 2015 Form 10-K.

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, 2016, we do not have any interest-rate swap agreements. Approximately 2% of our debt portfolio at June 30, 2016 and December 31, 2015 was 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, 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, internal investigations and compliance reviews, 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 our 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

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AVON PRODUCTS, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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

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. 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, 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 (as defined herein);

• 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;

• the possibility of business disruption in connection with our transformation plan, stabilization strategies, cost savings initiatives, or restructuring and other initiatives;

• our ability to reverse declining revenue, margins and net income, and to achieve profitable growth, particularly in our largest markets, such as Brazil, and developing and emerging markets, such as 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, and any potential sanctions, restrictions or responses to such conditions imposed by other markets in which we operate;

• developments in or consequences of any investigations and compliance reviews, and any litigation related thereto, including the investigations and compliance reviews of Foreign Corrupt Practices Act ("FCPA") and related United States ("U.S.") and foreign law matters in China and additional countries, as well as any disruption or adverse consequencesresulting from such investigations, reviews, related actions or litigation, including the retention of a compliance monitor as required by the deferred prosecution agreement with the U.S. Department of Justice and a consent to settlement with the Securities and Exchange Commission ("SEC"), any changes in Company policy or procedure suggested by the compliance monitor or undertaken by the Company, the duration of the compliance monitor and whether and when the Company will be permitted to undertake self-reporting, the Company’s compliance with the deferred prosecution agreement and whether and when the charges against the Company are dismissed with prejudice;

• 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 our 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;

48

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 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;

• 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 a continued decline in our business results, which includes the impact of any adverse foreign exchange movements, significant restructuring charges and significant legal settlements or judgments, on our ability to comply with certain covenants in our revolving credit facility;

• the impact of the transfer of certain pension obligations in connection with the separation of the North America business into New Avon and the impact of possible pension funding obligations, increased pension expense and any changes in pension standards and regulations or interpretations thereof on our cash flow and results of operations;

• 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;

• our ability to repurchase the Series C Preferred Stock (as defined herein) in connection with a change of control; and

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

Additional information identifying such factors is contained in Item 1A of our 2015 Form 10-K for the year ended December 31, 2015, as updated by this Quarterly Report on Form 10-Q, and other reports and documents we file with the SEC. We undertake no obligation to update any such forward-looking statements.

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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 2015 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, 2016, 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.

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AVON PRODUCTS, INC.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

See Note 8, Contingencies, to the consolidated financial statements included herein.

ITEM 1A. RISK FACTORS

Risk factors describing the major risks to our business can be found under Item 1A. Risk Factors in our 2015 Form 10-K. Except for the risk factor set forth below, there has been no material change in our risk factors from those previously discussed in our 2015 Form 10-K.

The affirmative vote in the United Kingdom to withdraw from the European Union may adversely affect our business.

On June 23, 2016, the United Kingdom ("UK") held a referendum in which voters approved an exit from the European Union ("EU"), commonly referred to as "Brexit." As a result of the referendum, it is expected that the British government will begin negotiating the terms of the UK’s future relationship with the EU. The Brexit vote may result in regulatory uncertainty throughout the region and could adversely affect business activity, political stability and economic conditions in the UK, the Eurozone, the EU and elsewhere. Any of these developments could have a material adverse effect on business activity in the UK, the Eurozone, or the EU. Given that we conduct a substantial portion of our business in the EU and the UK, and our plan to relocate our corporate headquarters to the UK, any of these developments could have a material adverse effect on our business, financial position, liquidity and results of operations or cash flows.

The uncertainty concerning the timing and terms of the exit could also have a negative impact on the growth of the UK and/or EU economies and cause greater volatility in the pound sterling, euro and/or other currencies. Changes in currency exchange rates may reduce the reported value of our revenues outside the U.S.

Changes to UK border and immigration policy could likewise occur as a result of Brexit, affecting our ability to recruit and retain employees from outside the UK.

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, 2016.

	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 - 4/30/16	168	(1)	$	3.17	*	*
5/1 - 5/31/16	24,413	(1)	4.83		*	*
6/1 - 6/30/16	7,407	(1)	4.39		*	*
Total	31,988		$	4.70	*	*

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

(1) All shares were repurchased by the Company in connection with employee elections to use shares to pay withholding taxes upon the vesting of their restricted stock units.

Some of these share repurchases may reflect a delay from the actual transaction date.

ITEM 6. EXHIBITS

See Exhibit Index.

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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 2, 2016	/s/ Robert Loughran
		Robert Loughran
		Group Vice President and
		Chief Accounting Officer
		Signed both on behalf of the
		registrant and as chief
		accounting officer.

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AVON PRODUCTS, INC.

EXHIBIT INDEX

10.1	Avon Products, Inc. 2016 Omnibus Incentive Plan (incorporated by reference to Appendix B to Avon's Proxy Statement as filed on April 15, 2016).
10.2	Form of Retention Restricted Stock Unit Award Agreement under the Avon Products, Inc. 2016 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.2 to Avon's Current Report on Form 8-K filed on May 26, 2016).
10.3	Form of Restricted Stock Unit Award Agreement under the Avon Products, Inc. 2016 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.3 to Avon's Current Report on Form 8-K filed on May 26, 2016).
10.4	Form of Performance Contingent Restricted Stock Unit Award Agreement under the Avon Products, Inc. 2016 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.4 to Avon's Current Report on Form 8-K filed on May 26, 2016).
10.5	Form of Stock Option Award Agreement under the Avon Products, Inc. 2016 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.5 to Avon's Current Report on Form 8-K filed on May 26, 2016).
10.6	Form of Stock Appreciation Right Certificate Agreement under the Avon Products, Inc. 2016 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.6 to Avon's Current Report on Form 8-K filed on May 26, 2016).
10.7	Letter Agreement, dated as of June 1, 2015, and Extension Letter, dated as of June 1, 2016, between Avon Products, Inc. and David Legher.
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 Income, (ii) Consolidated Statements of Comprehensive Income, (iii) Consolidated Balance Sheets, (iv) Consolidated Statements of Cash Flows and (v) Notes to Consolidated Financial Statements

53

EX-10.7

Exhibit 10.7

[Avon Letterhead]

Personal & Confidential

June 1, 2015

David Legher

SVP & President Brazil & South Market Group

Avon-Colombia

Dear David:

This letter confirms our mutual understanding of the terms and conditions applying to your assignment extension in Sao Paulo, Brazil as SVP & President Brazil & South Market Group, LATAM reporting to Sheri McCoy, Chief Executive Officer. Your assignment in Brazil is contingent upon our mutual understanding of the performance objectives which are subject to change at Avon’s discretion, timely local regulatory permission being obtained for you to work in Brazil, and your acceptance of the terms and conditions of this letter.

Your current international assignment is scheduled to end on May 31, 2015 and will be extended for one (1) year from June 1, 2015 until May 31, 2016. The assignment may end earlier, subject to the discretion of LATAM Management.

The terms and conditions in the Avon Long Term Corporate International Assignment Policy (issued January 1, 2013) will apply as of June 1, 2015, unless otherwise noted in this letter. Similarly, if you are re-assigned to a new location, the LTCIA Policy issued January 1, 2013 will apply to any new assignment at the time of reassignment.

In the event that your current assignment exceeds the expected end date, and a new assignment letter has not been extended, and/or you have not been repatriated, the terms and condition of your current assignment will continue to prevail.

The conditions of this letter are in accordance with the policies set forth in the Long Term Corporate International Assignment Policy (issued January 1, 2013), hereinafter referred to as the “Policy.” This letter summarizes key points in the Policy as it pertains to your assignment and may contain certain additional requirements. Please refer to the policy document for more details of the terms and conditions of your assignment. The Policy may be changed from time to time as legal requirements may dictate, new practices may require, or for other reasons at the discretion of the Company. In terms of this specific assignment, local conditions and guidelines applicable to Avon international assignees in Brazil will also govern your assignment.

TOTAL COMPENSATION

Total Compensation:

Your total compensation package remains unchanged as of the issue date of this letter except as follows. Your next salary review date is April 1, 2016. Total compensation is your current performance-based compensation. This includes your annual salary and any other bonuses or performance-related incentives

received during this assignment. Once the amount is determined, a hypothetical tax will be applied and you will be paid the net amount.

Compensation Delivery:

A balance sheet approach will continue to be used to ensure that your standard of living and taxes in

Brazil will be comparable to that which you are accustomed to in Colombia. Your first balance sheet issued under the 2013 LTCIA Policy will be effective as of June 1, 2015.

BENEFITS

While on your temporary assignment, the Avon-Colombia policies and benefit programs outlined in your home country offer letter/ employment agreement will remain in effect. Normal deductions for your

benefit plan choices will be in accordance with Avon-Colombia benefit policies.

Medical Insurance:

For the duration of your international assignment in Brazil, Avon will continue enrollment for you and your eligible dependents in an international expatriate medical plan. The Avon-Colombia payroll

department will continue to handle any payroll deductions required for social security taxes, other mandated contributions and contributions to the Avon-sponsored benefit plans in Colombia.

Vacation & Holidays:

Vacation eligibility is based on the Avon-Colombia vacation policy. Your public holidays will be based on the local Brazil holiday schedule.

TAXATION

Tax Equalization Adjustments:

Under the terms of the Tax Policy, your tax liability while on assignment in Brazil will be approximately

the amount that would be payable if you were working and living in Colombia. In order to equalize the tax obligation of your foreign service, a hypothetical Colombia income tax is computed and deducted from your total salary. A tax equalization calculation/reconciliation will be prepared at the end of each calendar year to determine if the appropriate Colombia taxes were withheld on your total compensation during your foreign service through your hypothetical income tax deductions.

The revised Avon Global Tax Equalization Policy (effective January 1, 2013) applies to your assignment. The revised Tax Equalization Policy formalizes the repayment of tax settlement amounts due Avon from your annual tax equalization calculation as follows: within 30 days of receipt of the calculation from Avon’s designated global tax services firm or within 30 days of receipt of tax refunds, as applicable.

In the event that you do not break tax residency in Colombia, you will remain on actual tax withholding and a hypothetical tax will not be implemented. However, the tax equalization process will still continue.

Ernst & Young LLP will continue to prepare your income tax returns while you are on foreign assignment. It is therefore imperative that you make contact with them to ensure that all necessary information is being compiled and that the tax process is in place to file your tax returns on a timely basis. Your EY contacts are as follows:

E&Y Colombia

[name]

Telephone: [telephone number]

Email: [e-mail address]

E&Y Brazil

[name]

Telephone: [telephone number]

Email: [e-mail address]

[name], a Senior Manager at Ernst & Young (E&Y) in the United States, is responsible for the day-to-day coordination of tax issues regarding Avon’s worldwide expatriates. She may be reached at [telephone number] or via email at [e-mail address]. [name], a tax partner at Ernst & Young (E&Y) in New York, is responsible for Avon’s worldwide expatriate tax work.

In the event of severance, tax treatment of any payments made to you will be reviewed and income tax withholding adjusted accordingly, if necessary.

Hypothetical Tax:

As stated above, a hypothetical Colombia tax will be deducted from your total compensation when it is

paid to you. As stated, total compensation includes base salary, Management Incentive Plan, and any other bonuses or performance-related incentives received during your assignment. Severance payments may also be subject to hypothetical tax. A determination will be made by Avon at the time of payment, in consultation with E&Y.

Social Security:

The hypothetical tax deduction does not cover your home country social security obligation. The

Colombia payroll department should continue to handle this deduction while you are on assignment in Brazil, as applicable. You will not be responsible for any Brazil social taxes incurred while on assignment. These taxes will be paid on your behalf by the Colombia office.

ASSIGNMENT ALLOWANCES/REIMBURSEMENTS/SUPPORT

Unless otherwise stated, all assignment allowances/reimbursements will be paid net-of-tax.

Weichert Workforce Mobility (Weichert):

Avon has partnered with a third-party relocation company, Weichert, to assist you in for on-assignment

administration support. Your Assignment Counselor will continue to be [name], who can be reached via email at [e-mail address] or telephone at [telephone number].

Work Permit/Visa:

Avon will ensure all appropriate immigration documents, visas, and work permits are obtained to

facilitate your stay in Brazil. Weichert will initiate immigration services with Avon’s immigration

services law firm as needed to maintain your work authorization in Brazil. As a reminder, you are notpermitted to work in the host location without proper work authorization. You should consult withthe Global Mobility team and/or the immigration services law in order to maintain your workauthorization in Brazil.

Goods and Services Differential:

The goods and services differential is calculated by taking the difference between the goods and services

(G&S) index of host and home location times the amount that someone at your income level and family size would spend on goods and services in Colombia. The portion of your salary used on goods and services in Colombia is also referred to as your spendable income. It is the Colombia spendable income -

- not total base salary -- that is protected from the higher costs of goods and services abroad. At present, Mercer reports a goods & services index for Brazil above the present cost of living in Colombia. Mercer

continually monitors exchange rates and movements in the rate of inflation for both countries. As conditions change in the home and/or host countries, the differential may be increased, reduced, or eliminated based on new survey data from Mercer. Your balance sheet will reflect changes,

positive or negative, to your goods & services index and exchange rate only when there is an adjustment for inflation or new pricing surveys are available.

Your balance sheet will be updated in April and October of each year. Effective June 1, 2015, the calculation of the G&S differential will utilize your current annual base salary, up to a maximum annual base salary of US$200,000 or the equivalent in home country currency.

Host Country Housing:

Avon will be assuming the full cost of your housing in Brazil including your rent and utilities (excluding

telephone, cable television, and internet service) up to an approved maximum. Any rent above your housing allowance will be your responsibility.

Home Country Housing Charge:

A home country housing charge (housing norm) reflects the amount that you would have spent on

housing in Colombia. It is based on what someone with your family size and income level would spend on housing in Colombia as established by our consultants, Mercer. Since you have remained personally responsible for your home in Colombia and it was not rented, the housing obligation reflecting the amount that you would have spent on housing has not been deducted from your total compensation. You will be required to reconfirm your home country housing situation by signing a written affidavit that the home will continue to remain vacant and not generate any rental income while you are on assignment. You undertake the responsibility to immediately notify your assignment counselor if your situation

changes, i.e., you are receiving rental income on your residence, sell it, etc. At the time your counselor is notified, a housing deduction will be withheld from your payroll applied from the effective date of the change. Our outside consultants, Mercer, will assist us in determining the amount of this deduction.

Emergency Medical Assistance/Emergency Evacuation:

You are covered under the Company’s emergency evacuation policy through Travel Guard should such a situation arise. Some of the services that Travel Guard provides include physician/hospital/dental/vision referrals, emergency prescription replacement, in-patient and out-patient medical case management, and emergency medical evacuation transportation assistance. To contact Travel Guard, call toll-free [phone number] (International Collect: [phone number]) and reference Avon's Group Name and Policy Number: Avon Products Inc. – [number]. Please keep this information with you when you travel. You can also access the Travel Guard website, [web address]to find travel resources and a complete list of recommended healthcare providers in various locations throughout the world. You will be provided with a brochure and wallet card under separate cover.

Host Country Transportation.

You will continue to be provided with two company leased cars and drivers while on assignment in Brazil in accordance with local policy. You will cease to participate in your home country car/transportation

program for the duration of your international assignment.

Location Premium:

Because Sao Paulo, Brazil qualifies as a hardship location due to such factors as political/social and physical conditions you will receive a Location Premium equivalent to 10% of base salary. Effective

June 1, 2015, the premium percentage in effect at that time will be calculated on a maximum base salary of US$200,000 per year (or home country equivalent). This payment will not be subject to hypothetical

tax and will be paid through your balance sheet. The Location Premium percentage is subject to change, including being eliminated, to coincide with the change in conditions in Sao Paulo, Brazil

The Location Premium will be reflected on your balance sheet and will be paid via payroll.

Rest and Relaxation (R&R) Leave:

Since Sao Paulo, Brazil is designated as a hardship area, you will be eligible for a rest and relaxation

leave each year for 5 working days. These days should be used at the nearest non-hardship location

(Miami or alternatively your home location in Colombia provided that the cost is equivalent to a trip to

Miami) and are in addition to vacation/home leave. Reimbursement includes reasonable lodging (no

luxury hotels), airfare, and transportation to/from the airport only. The cost of meals, activities, and incidental expenses are not eligible for reimbursement.

If you decide to travel to a destination other than the nearest non-hardship location, reimbursement will be limited to the cost of a trip to the nearest non-hardship location; any excess will the assignee’s responsibility. In addition, you will need to provide Weichert with a travel quote to simulate the cost of a trip to the nearest non-hardship location, with your expense reimbursement request.

There is no carry-over from one assignment year to another in the event that you do not utilize thetrip.Furthermore, eligibility for R&R leave terminates at the end of the assignment – i.e. the trip cannot be utilized if you repatriate or are reassigned.

Should Sao Paulo, Brazil location lose its designation as a hardship location, the R&R leave will cease.

Education Assistance:

Education expenses, such as reasonable tuition, transportation, required textbooks, school uniforms, and

academic fees for your children starting at age 5, through the high school level (grade 12 or equivalent international grade), will be paid by the Avon-Brazil office if the public school system in Brazil does not enable your children to return to the Colombia school system at the grade they would have been in had they not gone on this assignment. School supplies, meals, and extra-curricular activities are not eligible for reimbursement.

Home Leave Allowance:

Effective June 1, 2015, you will be provided with an annual cash home leave allowance which will be processed by Weichert. The allowance will be based upon round-trip airfare to Colombia (one trip per accompanying family member) via the most direct route available, plus the estimated cost of ground transportation to/from the airport. Class of travel will be determined by the Avon Business Travel policy.

Subsequent home leave allowance payments, if applicable, will occur on or about the anniversary date of your assignment, for the following assignment year. You should contact Weichert to request payment and provide your current banking details.

Please note: the home leave allowance will not be paid in advance of the start of the assignment year.

Club Membership:

As a social outlet, you and your eligible dependents will continue to be eligible for a club membership. Please contact [name] before making any arrangements.

Expense Reimbursements:

All assignment expenses should be submitted to Weichert for reimbursement. This includes but is not

limited to: relocation expenses, temporary living expenses, school fees, education, etc. Assignment expenses are not to be submitted through Concur or any local expense process for reimbursement without prior approval from Global Mobility. Most assignment expenses are taxable and therefore Global Mobility and Weichert must have visibility to these expenses to ensure proper tax compliance for Avon.

Personal Property & Liability Insurance:

Personal Property Insurance and Personal Liability Insurance will continue during your assignment. Youshould review your valued inventory to ensure it is up to date. Please contact [name] of Unirisc to update your valued inventory or with any questions on your coverage.

SPECIAL PAYMENTS

In some locations, certain host country special payments and host country severance (termination

indemnity) payments are required by local law. Should you qualify for and/or receive host country additional compensation required by local law, you understand that you are not entitled to these benefitsunder this agreement and you must return these benefits to Avon. In some cases, such home country benefits, payments, allowances or differentials will automatically be offset for the host country special payments, at Avon's direction.

DATA PRIVACY

During the assignment, your personal information will be collected and stored electronically in order to process salary payments, track your assignment details and generate other reports. By signing this letter, you expressly consent to the transfer of any information by Avon to related companies.

EMPLOYMENT CONSIDERATIONS

It is understood that in accepting this assignment, the terms and conditions are to be kept strictly confidential and to be the basis of your employment in Brazil. It is also understood that you will continue to adhere to the spirit of Avon policies, and that Human Resources policies governing compensation and benefits as they relate to your particular case will be determined by reference to Avon-Colombia’s practices rather than Brazil’s practices, as well as by reference to the Avon Long Term Corporate International Assignment Policy and Global Tax Equalization Policy. It is also understood that all of the items covered in this letter are subject to your continued satisfactory performance.

REPATRIATION SUPPORT

Weichert Workforce Mobility (Weichert):

Your Assignment Counselor will continue to support you during the repatriation process.

Miscellaneous Relocation Allowance:

Upon your return to Colombia ORyour reassignment to another location you will receive one month’s

base salary as a relocation allowance (i.e. two allowances will not be paid at the end of this assignment), not to exceed US$16,667 or the equivalent in home country currency. The relocation allowance is not subject to hypothetical income tax and will be paid net of tax.

This payment is designed to defray expenses not otherwise covered by the provisions of this letter, including but not limited to: tips paid to the moving crew, additional luggage, loss on sale of locally purchased items, cleaning and preparation of your home country residence, etc. Please reference Policy for additional information.

Shipment/Storage of Effects:

You will be reimbursed for the cost of shipping limited household and personal effects from Brazil in accordance with the Policy.

In the event that you were provided with furnished accommodations in Brazil or a furniture purchase allowance, only an air shipment will be provided

Pet Shipment Allowance:

If you have a pet that you plan to relocate to Colombia, you will be reimbursed for pet shipment expenses

up to a maximum of US$5,000 (or local currency equivalent). This reimbursement is intended to subsidize the cost of shipping; veterinarian fees and quarantine expenses are not eligible for reimbursement. Upon completion of your assignment, you will be reimbursed for return shipment expenses for your pet, up to the same maximum amount.

Destination Assistance:

Lease cancellation support and related relocation services in Brazil will be provided to you through the

services of consultants as appointed by Avon. Please contact Weichert for further instructions.

Temporary Living Expenses:

Temporary lodging will be provided in Brazil during packing of your household goods commences until

you depart Brazil. Upon arrival in Colombia, if your housing is not immediately available, you will be reimbursed for lodging for a period not to exceed a combined maximum of forty-five (45) days in both locations. A per diem will be provided to cover the cost of meals and incidental expenses. A rental car will be made available during this period, if necessary. These expenses will be reimbursed via Weichert.

You should contact Weichert before making any arrangements for temporary lodging.

Provision of Major Appliances:

If Avon purchased major appliances and/or furniture on your behalf, these items must be returned at the

end of your assignment. You will be given the opportunity to purchase them at a fair market price should you desire to do so. However you will be responsible for any shipping costs. Please contact your

Weichert assignment counselor for further details.

Loss on Sale of Automobile: Should you elect to dispose of your personal automobile in Brazil you will be reimbursed for the loss on the disposal capped at 20% of the retail value of the automobile.

PERFORMANCE AND REPATRIATION

Should you terminate while abroad, either at your own or Avon's election, Avon will pay repatriation expenses for you, your family and your household goods in accordance with Policy guidelines as described above. Expenses to your point of origin (Colombia) would be paid, provided you return to that point within 30 days of termination. Of course, repatriation expenses would not be paid if you were to stay in Brazil or if you were to be employed by another company. In the event of involuntary termination

during or upon completion of your assignment, you will be entitled to receive severance benefits available to Colombia associates at your title/grade level under the Avon severance policy for Avon-Colombia

and/or the government-sponsored plan of your home country, in effect at such time or as required by

home country labor/employment law. Prior to the receipt of Avon severance benefits, you must sign an agreement containing: (i) a general release of all claims; (ii) a non-compete; (iii) a non-solicitation; and

(4) a cooperation clause.

Upon successful completion of your assignment as SVP & President Brazil & South Market Group, LATAM, it is our current intent to offer you a position comparable to that position or to repatriate you to Colombia. Of course, any such offer would be dependent on market conditions, Avon’s business structure and other circumstances that cannot be known at this time.

David, I believe we have covered the pertinent points of your assignment extension. After you have reviewed this agreement, please sign the enclosed two copies of this letter and send one to [name] in New York. The other copy may be retained for your files. I wish you the best in your assignment.

Sincerely,

/s/Sheri McCoy	/s/ Ann Verillo
Sheri McCoy	Ann Verillo
Chief Executive Officer	VP, Global Compensation and Benefits
/s/ Amy White Byrne
Amy White Byrne
Vice President, HR, Latin America & Global Marketing

Avon Products, Inc. 777 Third Avenue, New York, NY 10105, 212-282-8500

[Avon Letterhead]

PERSONAL & CONFIDENTIAL

June 1, 2016

David Legher

Senior Vice President, South Latin America

Avon – Colombia

Dear David:

This letter confirms our discussions regarding the terms and conditions that apply to your assignment extension in Sao Paulo, Brazil as Senior Vice President, South Latin America reporting to John Higson, Executive Vice President EMEA and LATAM. Your assignment in Brazil continues to be contingent upon our mutual understanding of the performance objectives which are subject to change at Avon’s discretion.

Your current international assignment is scheduled to end on May 31, 2016 and will be extended for one (1) year covering the period of June 1, 2016 to May 31, 2017. The assignment may end earlier, subject to the discretion of Avon Management. In the event that your current assignment exceeds the expected end date, and new terms have not been provided, and/or you have not been repatriated, the terms and condition of this extension will continue to prevail.

During this extension period, your assignment will continue to be governed under the Avon Long Term Corporate International Assigment Policy, which includes the Avon Global Tax Equalization Policy (issued January 1, 2013), and as such the current terms and conditions of your assignment remain as described in your prior assignment letter dated June 1, 2015. Note policies may be changed from time to time as legal requirements may dictate, new practices may require, or for other reasons at Avon’s discretion. In terms of this specific assignment, local conditions and guidelines applicable to Avon international assignees in Brazil will also govern your assignment.

Sincerely,

/s/John Higson	/s/Susan Ormiston
John Higson	Susan Ormiston
Executive Vice President EMEA and LATAM	Senior Vice President and CHRO

Acknowledged and Understood:

/s/David Legher

David Legher    

Senior Vice President, South Latin America

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Sherilyn S. McCoy, 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 2, 2016

/s/ Sherilyn S. McCoy

Sherilyn S. McCoy

Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, James S. Scully, 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 2, 2016

/s/ James S. Scully

James S. Scully

Executive Vice President, Chief Operating

Officer 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, 2016, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Sherilyn S. McCoy, 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/ Sherilyn S. McCoy

Sherilyn S. McCoy

Chief Executive Officer

August 2, 2016

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, 2016, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, James S. Scully, 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/ James S. Scully

James S. Scully

Executive Vice President, Chief Operating

Officer and Chief Financial Officer

August 2, 2016

XML

Document And Entity Information	6 Months Ended
	Jun. 30, 2016 shares
DEI [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q2
Entity Registrant Name	AVON PRODUCTS INC
Entity Central Index Key	0000008868
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding	437,019,165

XML

Consolidated Statements of Operations - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Income Statement [Abstract]
Net sales	$ 1,399.5	$ 1,544.5	$ 2,679.5	$ 3,077.4
Other revenue	34.8	20.4	61.3	39.6
Total revenue	1,434.3	1,564.9	2,740.8	3,117.0
Costs, expenses and other:
Cost of sales	565.0	611.0	1,083.8	1,222.7
Selling, general and administrative expenses	774.2	864.2	1,554.1	1,837.5
Operating profit	95.1	89.7	102.9	56.8
Interest expense	33.2	30.5	65.9	58.6
Interest income	(5.3)	(3.1)	(9.3)	(6.1)
Other (income) expense, net	(4.7)	1.1	132.5	19.8
Total other expenses	23.2	28.5	189.1	72.3
Income before taxes	71.9	61.2	(86.2)	(15.5)
Income taxes	(36.1)	(32.3)	(33.8)	(98.2)
Income from continuing operations, net of tax	35.8	28.9	(120.0)	(113.7)
(Loss) income from discontinued operations, net of tax	(2.6)	0.8	(12.2)	(3.0)
Net income	33.2	29.7	(132.2)	(116.7)
Net income attributable to noncontrolling interests	(0.2)	(0.9)	(0.7)	(1.8)
Net income attributable to Avon	$ 33.0	$ 28.8	$ (132.9)	$ (118.5)
Basic attributable to Avon
Basic from continuing operations (in usd per share)	$ 0.07	$ 0.06	$ (0.29)	$ (0.26)
Basic from discontinued operations (in usd per share)	(0.01)	0.00	(0.03)	(0.01)
Basic attributable to Avon (in usd per share)	0.06	0.07	(0.32)	(0.27)
Diluted from continuing operations (in usd per share)	0.07	0.06	(0.29)	(0.26)
Diluted from discontinued operations (in usd per share)	(0.01)	0.00	(0.03)	(0.01)
Diluted (in usd per share)	0.06	0.07	(0.32)	(0.27)
Cash dividends per common share (in usd per share)	$ 0.00	$ 0.06	$ 0.00	$ 0.12

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Consolidated Statements Of Comprehensive Income (Loss) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016		Jun. 30, 2015
Statement of Comprehensive Income [Abstract]
Net (loss) income	$ 33.2	$ 29.7	$ (132.2)		$ (116.7)
Other comprehensive loss:
Foreign currency translation adjustments	(8.1)	21.1	87.8		(105.5)
Change in derivative losses on cash flow hedges, net of taxes	0.5	0.5	0.9	[1]	0.9
Adjustments of and amortization of net actuarial loss and prior service cost, net of taxes	4.2	13.3	268.2		23.0
Total other comprehensive loss, net of taxes	(3.4)	34.9	356.9		(81.6)
Comprehensive loss	29.8	64.6	224.7		(198.3)
Less: comprehensive loss attributable to noncontrolling interest	(0.9)	(0.5)	0.2		(0.1)
Comprehensive loss attributable to Avon	$ 30.7	$ 65.1	$ 224.5		$ (198.2)

[1] Gross amount reclassified to interest expense, and related taxes reclassified to income taxes.

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Consolidated Statements Of Comprehensive Income (Loss) Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Statement of Comprehensive Income [Abstract]
Change in derivative losses on cash flow hedges, tax	$ 0.0	$ 0.0	$ 0.0	$ 0.0
Adjustment of and amortization of net actuarial loss and prior service cost, taxes	$ 0.2	$ 0.3	$ 10.6	$ 0.6

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Consolidated Balance Sheets - USD ($) $ in Millions	Jun. 30, 2016	Dec. 31, 2015
Current Assets
Cash and cash equivalents	$ 741.5	$ 686.9
Accounts receivable, net	466.2	443.0
Inventories	665.5	624.0
Prepaid expenses and other	314.0	296.1
Current assets of discontinued operations	7.0	291.1
Total current assets	2,194.2	2,341.1
Property, plant and equipment, at cost	1,507.6	1,495.7
Less accumulated depreciation	(764.3)	(728.8)
Property, plant and equipment, net	743.3	766.9
Goodwill	96.1	92.3
Other assets	604.5	490.0
Noncurrent assets of discontinued operations	0.0	180.1
Total assets	3,638.1	3,870.4
Current Liabilities
Debt maturing within one year	48.8	55.2
Accounts payable	723.7	774.2
Accrued compensation	138.8	157.6
Other accrued liabilities	417.9	419.6
Sales and taxes other than income	144.3	174.9
Income taxes	6.6	23.9
Payable to discontinued operations	0.0	100.0
Current liabilities of discontinued operations	12.0	489.7
Total current liabilities	1,492.1	2,195.1
Long-term debt	2,139.6	2,150.5
Employee benefit plans	164.9	177.5
Long-term income taxes	76.7	65.1
Other liabilities	162.1	78.4
Noncurrent liabilities of discontinued operations	0.0	260.2
Total liabilities	4,035.4	4,926.8
Commitments and contingencies (Note 8)
Series C convertible preferred stock	433.6	0.0
Shareholders’ Deficit
Common stock	188.5	187.9
Additional paid-in capital	2,266.1	2,254.0
Retained earnings	2,308.0	2,448.1
Accumulated other comprehensive loss	(1,009.8)	(1,366.2)
Treasury stock, at cost	(4,597.8)	(4,594.1)
Total Avon shareholders’ deficit	(845.0)	(1,070.3)
Noncontrolling interests	14.1	13.9
Total shareholders’ deficit	(830.9)	(1,056.4)
Total liabilities, series C convertible preferred stock and shareholders’ deficit	$ 3,638.1	$ 3,870.4

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Consolidated Statements of Cash Flows - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2016		Jun. 30, 2015
Cash Flows from Operating Activities
Net income	$ (132.2)		$ (116.7)
Loss from discontinued operations, net of tax	12.2		3.0
Loss from continuing operations, net of tax	(120.0)		(113.7)
Adjustments to reconcile net loss to net cash (used) provided by operating activities:
Depreciation	41.7		49.7
Amortization	14.7		17.4
Provision for doubtful accounts	73.8		68.1
Provision for obsolescence	18.5		22.7
Share-based compensation	16.0		11.9
Foreign exchange losses	0.0		6.1
Deferred income taxes	(15.0)		29.2
Charge for Venezuelan monetary assets and liabilities	0.0		(4.2)
Charge for Venezuelan non-monetary assets	0.0		101.7
Pre-tax gain on sale of business	120.5		0.0
Other	1.7		3.7
Changes in assets and liabilities:
Accounts receivable	(90.4)		(80.1)
Inventories	(69.6)		(70.5)
Prepaid expenses and other	2.3		(51.4)
Accounts payable and accrued liabilities	(65.5)		(42.8)
Income and other taxes	(24.2)		(25.5)
Noncurrent assets and liabilities	(34.7)		(29.2)
Net cash (used) provided by operating activities	(130.2)		(106.9)
Cash Flows from Investing Activities
Capital expenditures	(42.7)		(40.4)
Disposal of assets	1.9		4.3
Purchases of investments	0.0		(11.9)
Proceeds from sale of investments	0.0		0.6
Reduction of cash due to Venezuela deconsolidation	(4.5)		0.0
Other investing activities	1.6		0.0
Net cash provided (used) by investing activities	(43.7)		(47.4)
Cash Flows from Financing Activities
Cash dividends	0.0		(53.6)
Debt, net (maturities of three months or less)	(11.6)		(0.3)
Proceeds from debt	8.8		7.6
Repayment of debt	(6.2)		(4.4)
Repurchase of common stock	(3.7)		(2.5)
Net proceeds from the sale of series C convertible preferred stock	426.3		0.0
Other financing activities	(1.0)		(5.8)
Net cash used by financing activities	412.6		(59.0)
Net cash used by operating activities of discontinued operations	(65.9)		(3.0)
Net cash used by investing activities of discontinued operations	(96.7)		(1.7)
Net cash used by financing activities of discontinued operations	0.0		(10.1)
Net cash used by discontinued operations	(162.6)		(14.8)
Effect of exchange rate changes on cash and cash equivalents	(19.3)		(29.4)
Net decrease in cash and cash equivalents	56.8		(257.5)
Cash and cash equivalents at beginning of year	684.7	[1]	960.5
Cash and cash equivalents at end of period	$ 741.5	[2]	$ 703.0

[1] Includes cash and cash equivalents of discontinued operations of $(2.2) and $24.1 at the beginning of the year in 2016 and 2015, respectively.

[2] Includes cash and cash equivalents of discontinued operations of $1.0 and cash and cash equivalents held for sale of $6.1 at June 30, 2015.

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Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Millions	Dec. 31, 2015	Jun. 30, 2015	Dec. 31, 2014
Statement of Cash Flows [Abstract]
Cash and cash equivalents of discontinued operations and held for sale	$ (2.2)	$ 6.1	$ 24.1
Cash and cash equivalents held for sale		$ 1.0

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ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2016

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 2015 Annual Report on Form 10-K ("2015 Form 10-K") in preparing these unaudited financial statements. In our opinion, the unaudited interim consolidated financial statements reflect all adjustments of a normal recurring nature that are necessary for a fair statement of the results for the interim periods presented. Results for interim periods are not necessarily indicative of results for a full year. You should read these unaudited interim consolidated financial statements in conjunction with our consolidated financial statements contained in our 2015 Form 10-K. When used in this report, the terms "Avon," "Company," "we" or "us" mean Avon Products, Inc.

For interim consolidated financial statement purposes we provide for accruals under our various employee benefit plans for each quarter based on one quarter of the estimated annual expense. In addition, our tax provision is determined using an estimate of our consolidated annual effective tax rate, adjusted in the current period for discrete tax items including:

• the effects of significant, unusual or extraordinary pretax and tax items, if any;

• withholding taxes associated with current period cash repatriations; and

• the impact of loss-making subsidiaries for which we cannot recognize a tax benefit and subsidiaries that reduce the reliability of the estimated annual consolidated effective tax rate.

Venezuela

Venezuela's restrictive foreign exchange control regulations and our Venezuelan operations' increasingly limited access to U.S. dollars have resulted in an other-than-temporary lack of exchangeability between the Venezuelan bolivar and the U.S. dollar, and have restricted our Venezuelan operations' ability to pay dividends and settle intercompany obligations. The severe currency controls imposed by the Venezuelan government have significantly limited our ability to realize the benefits from earnings of our Venezuelan operations and access the resulting liquidity provided by those earnings. We expected that this other-than-temporary lack of exchangeability would continue for the foreseeable future, and as a result, we concluded that, effective March 31, 2016, we did not meet the accounting criteria of control in order to continue consolidating our Venezuelan operations and, as a result, account for our Venezuelan operations using the cost method of accounting. Our Consolidated Balance Sheets no longer includes the assets and liabilities of our Venezuelan operations and we no longer include the results of our Venezuelan operations in our Consolidated Financial Statements.

As a result of the change to the cost method of accounting, in the first quarter of 2016, we recorded a loss of approximately $120 in other expense, net. The loss was comprised of approximately $39 in net assets of the Venezuelan business and approximately $81 in accumulated foreign currency translation adjustments within AOCI (shareholders' deficit) associated with foreign currency changes before Venezuela was accounted for as a highly inflationary economy. The nets assets of the Venezuelan business were comprised of inventories of approximately $24, property, plant and equipment, net of approximately $15, other assets of approximately $11, cash of approximately $5, accounts receivable of approximately $4, and accounts payable and accrued liabilities of approximately $20.

In February 2015, the Venezuelan government announced the creation of a new foreign exchange system referred to as the SIMADI exchange ("SIMADI"). SIMADI began operating on February 12, 2015. There were multiple legal mechanisms in Venezuela to exchange currency. As SIMADI represented the rate which better reflected the economics of Avon Venezuela's business activity, in comparison to the other available exchange rates, we concluded that we should utilize the SIMADI exchange rate to remeasure our Venezuelan operations effective February 12, 2015. As a result of the change to the SIMADI rate, which caused the recognition of a devaluation of approximately 70% as compared to the exchange rate we had used previously, we recorded an after-tax benefit of approximately $3 (a benefit of approximately $4 in other expense, net, and a loss of approximately $1 in income taxes) in the first quarter of 2015, primarily reflecting the write-down of net monetary assets. In addition, as a result of using the historical U.S. dollar cost basis of non-monetary assets, such as inventories, these assets continued to be remeasured, following the change to the SIMADI rate, at the applicable rate at the time of their acquisition. The remeasurement of non-monetary assets at the historical U.S. dollar cost basis caused a disproportionate expense as these assets were consumed in operations, negatively impacting operating profit and net income by approximately $11 during the six months ended June 30, 2015. Also as a result of the change to the SIMADI rate, we determined that an adjustment of approximately $11 to cost of sales was needed to reflect certain non-monetary assets, primarily inventories, at their net realizable value, which was recorded in the first quarter of 2015.

In addition, at February 12, 2015, we reviewed Avon Venezuela's long-lived assets to determine whether the carrying amount of the assets was recoverable. Based on our expected cash flows associated with the asset group, we determined that the carrying amount of the assets, carried at their historical U.S. dollar cost basis, was not recoverable. As such, an impairment charge of approximately $90 to selling, general and administrative expenses was needed to reflect the write-down of the long-lived assets to their estimated fair value of $15.7, which was recorded in the first quarter of 2015. The fair value of Avon Venezuela's long-lived assets was determined using both market and cost valuation approaches. The valuation analysis performed required several estimates, including market conditions and inflation rates.

Accounting Standards Implemented

In April 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-03, Interest-Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs, which requires debt issuance costs to be presented in the balance sheet as a direct reduction from the associated debt liability rather than as an asset. We adopted this standard for the first fiscal quarter of 2016 and applied it retrospectively to all periods presented. Accordingly, $9.1 of debt issuance costs are reflected within long-term debt as of December 31, 2015. These costs were previously recorded within other assets.

Accounting Standards to be Implemented

In February 2016, the FASB issued ASU 2016-02, Leases, which requires all assets and liabilities arising from leases to be recognized in the statement of financial position. This standard is effective as of January 1, 2019. We are currently evaluating the effect that adopting this new accounting guidance will have on our consolidated financial statements.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, issued as a new Topic, Accounting Standards Codification Topic 606. The core principle of the guidance is that a Company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14, Deferral of the Effective Date, which resulted in the standard being effective beginning in 2018, with early adoption permitted in the beginning of 2017. This standard has been amended, and as amended, can be adopted either retrospectively or as a cumulative-effect adjustment as of the date of adoption. We are currently evaluating the effect that adopting this new accounting guidance will have on our consolidated financial statements.

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EARNINGS (LOSS) PER SHARE AND SHARE REPURCHASES

6 Months Ended

Jun. 30, 2016

Earnings Per Share Reconciliation [Abstract]

EARNINGS (LOSS) PER SHARE AND SHARE REPURCHASES

EARNINGS (LOSS) PER SHARE AND SHARE REPURCHASES

We compute earnings (loss) per share ("EPS") using the two-class method, which is an earnings (loss) allocation formula that determines earnings (loss) per share for common stock, and earnings (loss) allocated to convertible preferred stock and participating securities, as appropriate. The earnings allocated to convertible preferred stock are the larger of the preferred dividends accrued in the period or the percentage of earnings 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)	2016			2015			2016			2015
Numerator from continuing operations:
Income (loss) from continuing operations, less amounts attributable to noncontrolling interests	$	35.6		$	28.0		$	(120.7	)	$	(115.5	)
Less: (Earnings) loss allocated to participating securities	(.5		)	(.1		)	1.7			2.3
Less: Earnings allocated to convertible preferred stock	(5.9		)	—			(7.3		)	—
Income (loss) from continuing operations allocated to common shareholders	29.2			27.9			(126.3		)	(113.2		)
Numerator from discontinued operations:
(Loss) income from discontinued operations	$	(2.6	)	$	.8		$	(12.2	)	$	(3.0	)
Less: Loss allocated to participating securities	—			.4			.2			.7
(Loss) income allocated to common shareholders	(2.6		)	1.2			(12.0		)	(2.3		)
Numerator attributable to Avon:
Net income (loss) attributable to Avon	$	33.0		$	28.8		$	(132.9	)	$	(118.5	)
Less: (Earnings) loss allocated to participating securities	(.4		)	(.1		)	1.8			2.3
Less: Earnings allocated to convertible preferred stock	(5.9		)	—			(7.3		)	—
Income (loss) allocated to common shareholders	26.7			28.7			(138.4		)	(116.2		)
Denominator:
Basic EPS weighted-average shares outstanding	436.9			435.2			436.4			435.0
Diluted effect of assumed conversion of stock options	—			—			—			—
Diluted effect of assumed conversion of preferred stock	—			—			—			—
Diluted EPS adjusted weighted-average shares outstanding	436.9			435.2			436.4			435.0
Earnings (Loss) per Common Share from continuing operations:
Basic	$	.07		$	.06		$	(.29	)	$	(.26	)
Diluted	.07			.06			(.29		)	(.26		)
Loss per Common Share from discontinued operations:
Basic	$	(.01	)	$	—		$	(.03	)	$	(.01	)
Diluted	(.01		)	—			(.03		)	(.01		)
Earnings (Loss) per Common Share attributable to Avon:
Basic	$	.06		$	.07		$	(.32	)	$	(.27	)
Diluted	.06			.07			(.32		)	(.27		)

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

During the three months ended June 30, 2016 and 2015, we did not include stock options to purchase 15.2 million shares and 12.2 million shares, respectively, of Avon common stock in the calculation of diluted EPS because the exercise prices of those options were greater than the average market price, and therefore, their inclusion would be anti-dilutive. During the six months ended June 30, 2016 and 2015, we did not include stock options to purchase 13.8 million shares and 13.9 million shares, respectively, of Avon common stock in the calculation of diluted EPS as we had a loss from continuing operations, net of tax. The inclusion of these shares would decrease the net loss per share, and therefore, their inclusion would be anti-dilutive.

For the three and six months ended June 30, 2016, it is more dilutive to assume the Series C Convertible Preferred Stock is not converted into common stock and therefore the weighted-average outstanding shares outstanding was not adjusted by the as-if converted Series C Convertible Preferred Stock because the effect would decrease the net loss per share, and therefore, their inclusion would be anti-dilutive. 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, 2016. See Note 7, Series C Convertible Preferred Stock.

We purchased approximately .9 million shares of Avon common stock for $3.7 during the first six months of 2016, as compared to approximately .3 million shares of Avon common stock for $2.5 during the first six months of 2015, through acquisition of stock from employees in connection with tax payments upon vesting of restricted stock units.

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DISCONTINUED OPERATIONS

6 Months Ended

Jun. 30, 2016

Discontinued Operations and Disposal Groups [Abstract]

DISCONTINUED OPERATIONS

DISCONTINUED OPERATIONS

On December 17, 2015, the Company entered into definitive agreements with affiliates controlled by Cerberus Capital Management, L.P. ("Cerberus"). The agreements include an investment agreement providing for a $435 investment by Cleveland Apple Investor L.P. (f/k/a Cleveland Apple Investor LLC) (“Cerberus Investor”) (an affiliate of Cerberus) in the Company through the purchase of perpetual convertible preferred stock (see Note 7, Series C Convertible Preferred Stock) 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 Cleveland NA Investor LLC (“Cerberus NA”) (an affiliate of Cerberus). These transactions closed on March 1, 2016.

Cerberus NA contributed $170 of cash into New Avon in exchange for 80.1% of its ownership interests. The Company contributed the North America business, certain pension and postretirement liabilities and $100 of cash into New Avon in exchange for a 19.9% ownership interest of New Avon. The Company received $4 of cash from New Avon at closing as part of an estimate of a customary working capital adjustment.

During the fourth quarter of 2015, the Company recorded an estimated loss on sale of discontinued operations of approximately $340 before tax (approximately $340 after tax) as the carrying value exceeded the estimated fair value less costs to sell. During the three and six months ended June 30, 2016, the Company recognized additional losses on sale of approximately $1 before tax (approximately $1 after tax) and approximately $16 before tax (approximately $6 after tax), respectively. The loss on sale represented the net assets contributed into New Avon, including certain pension and postretirement benefit plan liabilities and amounts in AOCI associated with the North America business, which were primarily unrecognized losses associated with our U.S. defined benefit pension plan, and costs to sell, as compared to the implied value of our ownership interests in New Avon which was approximately $43. The ultimate loss on sale will be dependent on the finalization of the amount of pension and postretirement benefit plan liabilities contributed to New Avon and the finalization of customary working capital settlement, which are expected to be finalized in the second half of 2016.

New Avon entered into a perpetual, irrevocable royalty-free licensing agreement with the Company for the use of the Avon brand and certain other intellectual property. Avon and New Avon also entered into a transition services agreement which covers, among other things, information technology, financial services and human resources, as well as other commercial agreements, including for research and development and product supply. In addition, the Company subleases office space to New Avon. See Note 4, Related Party Transactions.

The Company accounts for its ownership interests in New Avon using the equity method of accounting, which results in the Company recognizing its proportionate share of New Avon's income or loss. The Company's proportionate share of the post-separation losses of New Avon was $.6 and $4.5 during the three and six months ended June 30, 2016, respectively, and was recorded within other expense, net.

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

	Three Months Ended June 30,						Six Months Ended June 30,
	2016			2015			2016			2015
Total revenue	$	—		$	258.5		$	135.2		$	500.6
Cost of sales	—			102.4			53.2			197.9
Selling, general and administrative expenses	1.2			154.0			89.0			305.3
Operating (loss) profit	(1.2		)	2.1			(7.0		)	(2.6		)
Other (expense) income items	—			(.2		)	.6			(1.4		)
Loss on sale of discontinued operations, before tax	(1.4		)	—			(16.3		)	—
(Loss) income from discontinued operations, before tax	(2.6		)	1.9			(22.7		)	(4.0		)
Income taxes	—			(1.1		)	10.5			1.0
(Loss) income from discontinued operations, net of tax	$	(2.6	)	$	.8		$	(12.2	)	$	(3.0	)

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RELATED PARTY TRANSACTIONS

6 Months Ended

Jun. 30, 2016

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

As discussed in Note 3, Discontinued Operations, the Company has entered into a transition services agreement to provide certain services to New Avon, as well as an agreement for research and development and subleases for office space. In addition, New Avon is performing certain services for the Company under a similar transition services agreement. The Company recorded a net $11.0 and $14.9 reduction of selling, general and administrative expenses associated with these agreements during the three and six months ended June 30, 2016, respectively.

The Company also supplies product to New Avon as part of these transition services. The Company recorded revenues of $9.8 and $13.5 and gross profit of $.4 and $.9 associated with this supply arrangement during the three and six months ended June 30, 2016, respectively. In addition, New Avon also supplies product to the Company as part of these transition services. The Company purchased $2.4 and $3.6 from New Avon associated with this supply arrangement during the three and six months ended June 30, 2016, respectively.

The Company also entered into agreements with an affiliate of Cerberus, which provide for the secondment of Cerberus affiliate personnel to the Company's project management team responsible for assisting with the execution of the transformation plan (the "Transformation Plan") announced in January 2016. The Company recorded $1.0 and $1.0 in selling, general and administrative expenses associated with these agreements during the three and six months ended June 30, 2016, respectively. See Note 12, Restructuring Initiatives for additional information related to the Transformation Plan.

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, 2016 the Company has accrued $2.1 for the estimated value of such standby letters of credit. The recognition of the liability was included in the estimated loss on sale of the North America business in loss from discontinued operations, net of tax.

See Note 7, Series C Convertible Preferred Stock, for discussion of preferred shares issued to Cerberus Investor.

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INVENTORIES

6 Months Ended

Jun. 30, 2016

Inventory, Net [Abstract]

Inventories

INVENTORIES

Components of Inventories	June 30, 2016		December 31, 2015
Raw materials	$	206.6	$	180.5
Finished goods	458.9		443.5
Total	$	665.5	$	624.0

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EMPLOYEE BENEFIT PLANS

6 Months Ended

Jun. 30, 2016

General Discussion of Pension and Other Postretirement Benefits [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
	2016			2015			2016			2015			2016			2015
Service cost	$	1.3		$	2.9		$	1.3		$	1.4		$	—		$	.1
Interest cost	.8			6.2			5.7			5.7			.3			.9
Expected return on plan assets	(1.0		)	(8.3		)	(8.7		)	(9.1		)	—			—
Amortization of prior service credit	—			(.2		)	—			—			—			(1.0		)
Amortization of net actuarial losses	1.6			11.5			1.7			2.1			(.1		)	.5
Settlements/curtailments	—			—			—			—			—			—
Net periodic benefit costs(1)	$	2.7		$	12.1		$	—		$	.1		$	.2		$	.5

	Six Months Ended June 30,
	Pension Benefits
Net Periodic Benefit Costs	U.S. Plans						Non-U.S. Plans						Postretirement Benefits
	2016			2015			2016			2015			2016			2015
Service cost	$	3.6		$	6.5		$	2.6		$	2.9		$	.1		$	.3
Interest cost	5.1			12.5			11.7			11.6			.9			1.8
Expected return on plan assets	(6.2		)	(16.6		)	(17.5		)	(18.2		)	—			—
Amortization of prior service credit	(.1		)	(.4		)	—			—			(.9		)	(2.0		)
Amortization of net actuarial losses	7.7			23.1			3.4			4.2			.1			1.0
Settlements/curtailments	.1			—			—			—			—			—
Net periodic benefit costs(1)	$	10.2		$	25.1		$	.2		$	.5		$	.2		$	1.1

⁽¹⁾ Includes $8.3 of U.S. pension for the three months ended June 30, 2015 and $4.4 and $17.2 of U.S. pension for the six months ended June 30, 2016 and 2015, respectively. Immaterial amounts of the postretirement benefit plans (related to the U.S.) are included in discontinued operations for the three months ended June 30, 2015 and for the six months ended June 30, 2016 and 2015. Amounts associated with the pension and postretirement benefit plans in Canada and the postretirement benefit plan in Puerto Rico, which are included in discontinued operations, have been excluded from all amounts in the tables above.

As part of the separation of the North America business, we transferred an initial estimate of $499.6 of pension liabilities under the U.S. defined benefit pension plan associated with current and former employees of the North America business and certain other former Avon employees, along with $358.0 of assets held by the U.S. defined benefit pension plan, to a defined benefit pension plan sponsored by New Avon. We also transferred an initial estimate of $60.4 of other postretirement liabilities (namely, retiree medical and supplemental pension liabilities) in respect of such employees and former employees. See Note 3, Discontinued Operations. We continue to retain certain U.S. pension and other postretirement liabilities primarily associated with employees who are actively employed by Avon outside of the North America business.

During the six months ended June 30, 2016, we made approximately $26 and $10 of contributions to the U.S. and non-U.S. defined benefit pension and postretirement benefit plans, respectively. During the remainder of 2016, we anticipate contributing approximately $1 and $10 to $15 to fund our U.S. and non-U.S. defined benefit pension and postretirement benefit plans, respectively.

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SERIES C CONVERTIBLE PREFERRED STOCK

6 Months Ended

Jun. 30, 2016

Equity [Abstract]

SERIES C CONVERTIBLE PREFERRED STOCK

SERIES C CONVERTIBLE PREFERRED STOCK

On March 1, 2016, we issued and sold to Cerberus Investor 435,000 shares of newly issued Series C Preferred Stock for an aggregate purchase price of $435.0 pursuant to an Investment Agreement, dated as of December 17, 2015, between the Company and Cerberus Investor. In connection with the issuance of the Series C Preferred Stock, the Company incurred direct and incremental expenses of $8.7, comprised of financial advisory fees and legal expenses, which reduced the carrying value of the Series C Preferred Stock. The Series C Preferred Stock has accrued dividends daily since March 1, 2016 at a rate of 1.25% per quarter, and as of June 30, 2016, had accrued unpaid dividends of $7.3. There were no cash dividends declared in the six months ended June 30, 2016.

Dividend Rights. The Series C Preferred Stock ranks senior to the shares of our common stock with respect to dividend rights and rights on the distribution of assets on any liquidation, dissolution or winding up of our affairs. The Series C Preferred Stock has a liquidation preference of $1,000 per share, representing an aggregate liquidation preference of $435.0 upon issuance. Holders of Series C Preferred Stock are entitled to participate on an as-converted basis in any cash dividends paid to the holders of shares of the Company’s common stock. In addition, cumulative preferred dividends accrue daily on the Series C Preferred Stock and are payable at a rate of 1.25% per quarter (net of any dividends on the Company’s common stock and subject to increase up to a maximum rate of 5.00% per quarter if the Company breaches certain obligations). Except to the extent not otherwise previously paid by the Company, preferred dividends are payable on the seventh anniversary of the issuance date of the Series C Preferred Stock as and when declared by the Board of Directors and at the end of each quarter thereafter. Accrued and unpaid preferred dividends may be paid, at the Company’s option, (i) in cash, (ii) subject to certain conditions, in shares of the Company’s common stock or (iii) upon conversion of shares of Series C Preferred Stock, in shares of the Company’s non-voting, non-convertible Series D Preferred Stock. Any such shares of Series D Preferred Stock issued would have similar preferential rights.

Conversion Features. Series C Preferred Stock is convertible at the option of the holders at any time into shares of the Company’s common stock at an initial conversion price of $5.00 per share, subject to certain anti-dilution adjustments. Prior to receipt of applicable shareholder approval, shares of Series C Preferred Stock are not convertible into more than 19.99% of the number of shares of common stock outstanding immediately prior to the issuance of the Series C Preferred Stock, subject to certain anti-dilution adjustments. As of June 30, 2016, Series C Preferred Stock was convertible into 87,051,524 shares of common stock. If at any time the volume weighted average price of the common stock exceeds $10.00 per share (subject to certain anti-dilution adjustments) for a period of 30 consecutive trading days, the Company may cause all of the Series C Preferred Stock to be converted into shares of common stock based on the then applicable conversion price.

Voting Rights. Holders of Series C Preferred Stock are entitled to vote generally with the holders of common stock on an as-converted basis. Holders of Series C Preferred Stock are also entitled to a separate class vote with respect to (i) the election of up to three directors to the Board of Directors, subject to maintaining certain levels of beneficial ownership of Series C Preferred Stock and/or common stock, (ii) amendments to the Company’s organizational documents that have an adverse effect on the Series C Preferred Stock, (iii) issuances by the Company of securities that are senior to, or equal in priority with, the Series C Preferred Stock or (iv) the delisting of the Company’s common stock, other than in connection with a change of control event.

Change of Control Put. Upon certain change of control events involving the Company, holders of Series C Preferred Stock can require the Company to repurchase the Series C Preferred Stock for an amount equal to the greater of (i) an amount in cash equal to 100% of the liquidation preference thereof plus all accrued but unpaid dividends or (ii) the consideration the holders would have received if they had converted their shares of Series C Preferred Stock into common stock immediately prior to the change of control event.

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CONTINGENCIES

6 Months Ended

Jun. 30, 2016

Loss Contingency [Abstract]

Contingencies

CONTINGENCIES

Settlements of FCPA Investigations

As previously reported, we engaged outside counsel to conduct an internal investigation and compliance reviews focused on compliance with the Foreign Corrupt Practices Act ("FCPA") and related U.S. and foreign laws in China and additional countries. The internal investigation, which was conducted under the oversight of our Audit Committee, began in June 2008 and along with the compliance reviews, was completed in 2014.

Following our voluntary reporting of the internal investigation to both the U.S. Department of Justice (the “DOJ”) and the U.S. Securities and Exchange Commission (the “SEC”) and our subsequent cooperation with those agencies, the United States District Court for the Southern District of New York (the "USDC") approved in December 2014 a deferred prosecution agreement (“DPA”) entered into between the Company and the DOJ related to charges of violations of the books and records and internal controls provisions of the FCPA. In addition, Avon Products (China) Co. Ltd., a subsidiary of the Company operating in China, pleaded guilty to conspiring to violate the books and records provision of the FCPA and was sentenced by the USDC to pay a $68 fine. The SEC also filed a complaint against the Company charging violations of the books and records and internal controls provisions of the FCPA and the Consent which was approved in a judgment entered by the USDC in January 2015, and included $67 in disgorgement and prejudgment interest. The DPA, the above-mentioned guilty plea and the Consent resolved the SEC’s and the DOJ’s investigations of the Company’s compliance with the FCPA and related U.S. laws in China and additional countries. The fine was paid in December 2014 and the payment to the SEC was made in January 2015.

Under the DPA, the DOJ will defer criminal prosecution of the Company for a term of three years. If the Company remains in compliance with the DPA during its term, the charges against the Company will be dismissed with prejudice. Under the DPA, the Company also represented that it has implemented and agreed that it will continue to implement a compliance and ethics program designed to prevent and detect violations of the FCPA and other applicable anti-corruption laws throughout its operations.

Under the DPA and the Consent, among other things, the Company agreed to have a compliance monitor (the "monitor"). During July 2015, the Company engaged a monitor, who had been approved by the DOJ and SEC. With the approval of the DOJ and the SEC, the monitor can be replaced by the Company after 18 months, if the Company agrees to undertake self-reporting obligations for the remainder of the monitoring period. The monitoring period is scheduled to expire in July 2018. There can be no assurance as to whether or when the DOJ and the SEC will approve replacing the monitor with the Company’s self-reporting. If the DOJ determines that the Company has knowingly violated the DPA, the DOJ may commence prosecution or extend the term of the DPA, including the monitoring provisions described above, for up to one year.

The monitor is assessing and monitoring the Company's compliance with the terms of the DPA and the Consent by evaluating, among other things, the Company's internal accounting controls, recordkeeping and financial reporting policies and procedures. The monitor has recommended some changes to our policies and procedures that we are in the process of adopting, and may make additional recommendations that we must adopt unless they are unduly burdensome or otherwise inadvisable, in which case we may propose alternatives, which the DOJ and the SEC may or may not accept. In addition, operating under the oversight of the monitor may result in additional time and attention on these matters by members of our management, which may divert their time from the operation of our business. Assuming the monitor is replaced by a self-reporting period, the Company’s self-reporting obligations may be costly or time-consuming.

The costs incurred in connection with ongoing compliance with the DPA and the Consent, including the monitorship, have not been material to date and we do not anticipate material costs going forward. We currently cannot estimate the costs that we are likely to incur in connection with self-reporting, if applicable, and any additional costs of implementing the changes, if any, to our policies and procedures required by the monitor.

Litigation Matters

In July and August 2010, derivative actions were filed in state court against certain present or former officers and/or directors of the Company (Carol J. Parker, derivatively on behalf of Avon Products, Inc. v. W. Don Cornwell, et al. and Avon Products, Inc. as nominal defendant (filed in the New York Supreme Court, Nassau County, Index No. 600570/2010); Lynne Schwartz, derivatively on behalf of Avon Products, Inc. v. Andrea Jung, et al. and Avon Products, Inc. as nominal defendant (filed in the New York Supreme Court, New York County, Index No. 651304/2010)). On November 22, 2013, a derivative action was filed in federal court against certain present or former officers and/or directors of the Company and following the federal court's dismissal, an additional action was subsequently filed in New York state court on May 1, 2015 (Sylvia Pritika, derivatively on behalf of Avon Products, Inc. v. Andrea Jung, et al. and Avon Products, Inc. as nominal defendant (filed in the New York Supreme Court, New York County, Index No. 651479/2015)). The claims asserted in one or more of these actions include alleged breach of fiduciary duty, abuse of control, waste of corporate assets, and unjust enrichment, relating to the Company's compliance with the FCPA, including the adequacy of the Company's internal controls. The relief sought against the individual defendants in one or more of these derivative actions include certain declaratory and equitable relief, restitution, damages, exemplary damages and interest. The Company is a nominal defendant, and no relief is sought against the Company itself. On April 28, 2015, an action was filed to seek enforcement of demands for the inspection of certain of the Company’s books and records (Belle Cohen v. Avon Products, Inc. (filed in the New York Supreme Court, New York County, Index No. 651418/2015)). The parties have reached agreements to settle the derivative and books and records actions. The terms of settlement include certain corporate governance measures as well as releases of claims. The Company has accrued approximately $4 with respect to these matters, which the Company expects will be paid by insurance. Settlement is conditioned upon court approval of the proposed resolution of the derivative actions. On March 30, 2016, the court granted preliminary approval of the settlement. On June 30, 2016, the court held a hearing to consider final approval of the settlement and, thereafter, the court entered the order and judgment approving the settlement. In light of the settlement, stipulations voluntarily dismissing or discontinuing the actions with prejudice have been filed in the Pritika and Parker actions. In the event that the settlement of the derivative actions does not become final, we are unable to predict the outcome of these matters.

On July 6, 2011, a purported shareholder's class action complaint (City of Brockton Retirement System v. Avon Products, Inc., et al., No. 11-CIV-4665) was filed in the United States District Court for the Southern District of New York against the Company and certain present or former officers and/or directors of the Company. On September 29, 2011, the Court appointed LBBW Asset Management Investmentgesellschaft mbH and SGSS Deutschland Kapitalanlagegesellschaft mbH as lead plaintiffs and Motley Rice LLC as lead counsel. Lead plaintiffs filed an amended complaint, and the defendants moved to dismiss the amended complaint on June 14, 2012. On September 29, 2014, the Court granted the defendants' motion to dismiss and also granted the plaintiffs leave to amend their complaint. On October 24, 2014, plaintiffs filed their second amended complaint on behalf of a purported class consisting of all persons or entities who purchased or otherwise acquired shares of Avon's common stock from July 31, 2006 through and including October 26, 2011. The second amended complaint names as defendants the Company and two individuals and asserts violations of Sections 10(b) and 20(a) of the Exchange Act based on allegedly false or misleading statements and omissions with respect to, among other things, the Company's compliance with the FCPA, including the adequacy of the Company's internal controls. Plaintiffs seek compensatory damages and declaratory, injunctive, and other equitable relief. Defendants moved to dismiss the Second Amended Complaint on November 21, 2014. The parties have reached an agreement on a settlement of this class action. The terms of settlement include releases by members of the class of claims against the Company and the individual defendants and payment of $62. Under the terms of the settlement, approximately $60 of the settlement was paid by the Company's insurers and approximately $2 was paid by the Company (which represented the remaining deductible under the Company’s applicable insurance policy) into escrow. On August 21, 2015, the court granted preliminary approval of the settlement, and on December 1, 2015 the court held a hearing to consider final approval of the settlement and expressed an intent to grant final approval. However, the court has not yet entered a final judgment approving the settlement. If the settlement is not approved by the court, or is otherwise terminated before it is finalized, the Company will be unable to predict the outcome of this matter. Furthermore, in that event, it is reasonably possible that the Company may incur a loss in connection with this matter, which the Company is unable to reasonably estimate.

Between December 23, 2014 and March 12, 2015, two purported class actions were filed in the United States District Court for the Southern District of New York -- Poovathur v. Avon Products, Inc., et al. (No. 14-CV-10083) and McCoy et al. v. Avon Products, Inc., et al. (No. 15-CV-01828) asserting claims under the Employee Retirement Income Security Act ("ERISA") against the Company, the Plan's administrator, benefits board and investment committee, and certain individuals alleged to have served as Plan fiduciaries. On April 8, 2015, the Court consolidated the two actions and recaptioned the consolidated case as In re 2014 Avon Products, Inc. ERISA Litigation, (No. 14-CV-10083). On May 8, 2015, plaintiffs filed a consolidated complaint, asserting claims for alleged breach of fiduciary duty and failure to monitor under ERISA on behalf of a purported class of participants in and beneficiaries of the Plan who invested in and/or held shares of the Avon Common Stock Fund between July 31, 2006 and May 1, 2014 and between December 14, 2011 and the present.  Plaintiffs seek, inter alia, certain monetary relief, damages, and declaratory, injunctive and other equitable relief. On July 9, 2015, Defendants moved to dismiss the consolidated complaint. The parties have reached an agreement on a settlement of this class action. The terms of settlement include releases by members of the class of claims against the Company and the individual defendants and payment of approximately $6. Under the terms of the settlement, approximately $5 of the settlement will be paid by the Company’s insurer and approximately $1 will be paid by the Company (which represents the remaining deductible under the Company’s applicable insurance policy). On June 7, 2016, the court granted preliminary approval of the settlement and scheduled a hearing to consider final approval for October 11, 2016. If the settlement is not approved by the court, or is otherwise terminated before it is finalized, the Company will be unable to predict the outcome of this matter. Furthermore, in that event, it is reasonably possible that the Company may incur a loss in connection with this matter, which the Company is unable to reasonably estimate.

Under some circumstances, any losses incurred in connection with adverse outcomes in the litigation matters described above could be material.

Brazilian Tax Assessments

In 2002, our Brazilian subsidiary received an excise tax (IPI) assessment from the Brazilian tax authorities for alleged tax deficiencies during the years 1997-1998. In December 2012, additional assessments were received for the year 2008 with respect to excise tax (IPI) and taxes charged on gross receipts (PIS and COFINS). In the second quarter of 2014, the PIS and COFINS assessments were officially closed in favor of Avon Brazil. The 2002 and the 2012 IPI assessments assert that the establishment in 1995 of separate manufacturing and distribution companies in Brazil was done without a valid business purpose and that Avon Brazil did not observe minimum pricing rules to define the taxable basis of excise tax. The structure adopted in 1995 is comparable to that used by many other companies in Brazil. We believe that our Brazilian corporate structure is appropriate, both operationally and legally, and that the 2002 and 2012 IPI assessments are unfounded.

These matters are being vigorously contested. In January 2013, we filed a protest seeking a first administrative level review with respect to the 2012 IPI assessment. In July 2013, the 2012 IPI assessment was upheld at the first administrative level and we have appealed this decision to the second administrative level. The 2012 IPI assessment totals approximately $315, including penalties and accrued interest. In October 2010, the 2002 IPI assessment was upheld at the first administrative level at an amount reduced to approximately $28 from approximately $66, including penalties and accrued interest. We appealed this decision to the second administrative level, which ruled in favor of Avon in March 2015 and canceled the 2002 IPI assessment. The Brazilian tax authorities' appeal to this favorable decision regarding the 2002 IPI assessment is still pending.

In the event that the 2002 or 2012 IPI assessments are upheld at the last administrative level, it may be necessary for us to provide security to pursue further appeals, which, depending on the circumstances, may result in a charge to earnings. It is not possible to reasonably estimate the likelihood or potential amount of assessments that may be issued for subsequent periods (tax years up through 2010 are closed by statute). However, other similar IPI assessments involving different periods (1998-2001) have been canceled and officially closed in our favor by the second administrative level. We believe that the likelihood that the 2002 IPI assessment will be upheld on any further appeal is remote and the likelihood that the 2012 IPI assessment will be upheld is reasonably possible. As stated above, we believe that the 2002 and 2012 IPI assessments are unfounded.

Brazil IPI Tax on Cosmetics

In May 2015, an Executive Decree on certain cosmetics went into effect in Brazil which increased the amount of IPI taxes that are to be remitted by Avon Brazil to the taxing authority on the sales of cosmetic products subject to IPI. Avon Brazil filed an objection to this IPI tax increase on the basis that it is not constitutional. From May 2015 through April 2016 Avon Brazil remitted the taxes associated with this IPI tax increase into a judicial deposit which would be remitted to the taxing authorities in the event that we are not successful in our objection to the tax increase.

In May 2016, Avon Brazil received a favorable preliminary decision on its objection to the tax and was granted a preliminary injunction. As a result, beginning in May 2016 Avon Brazil is no longer required to remit the taxes associated with IPI into a judicial deposit. As the IPI tax increase remains in effect, Avon Brazil is continuing to recognize the IPI taxes associated with the May 2015 Executive Decree as a liability. At June 30, 2016, the liability to the taxing authorities for this IPI tax increase was $82 and was classified within other liabilities in the Consolidated Balance Sheets, and the judicial deposit was $64 and was classified within other assets in the Consolidated Balance Sheets.

An unfavorable ruling to our objection of this IPI tax increase would have an adverse effect on our consolidated cash flows as Avon Brazil would have to remit the liability owed to the taxing authorities. This amount would be partially offset by the amount of the judicial deposit held by Avon Brazil. We are not able to reliably predict the timing of the outcome of our objection to this tax increase.

Other Matters

Various other lawsuits and claims, arising in the ordinary course of business or related to businesses previously sold, are pending or threatened against Avon. In management's opinion, based on its review of the information available at this time, the total cost of resolving such other contingencies at June 30, 2016, is not expected to have a material adverse effect on our consolidated financial position, results of operations or cash flows.

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

6 Months Ended

Jun. 30, 2016

Accumulated Other Comprehensive Income [Abstract]

Accumulated Other Comprehensive Income (Loss)

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The tables below present the changes in AOCI by component and the reclassifications out of AOCI for the three months ended June 30, 2016 and 2015:

Three Months Ended June 30, 2016:	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Total
Balance at March 31, 2016	$	(854.8	)	$	(.9	)	$	(4.3	)	$	(146.6	)	$	(1,006.6	)
Other comprehensive loss other than reclassifications	(7.9		)	—			—			(1.4		)	(9.3		)
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0(1)	—			.5			—			—			.5
Amortization of net actuarial loss and prior service cost, net of tax of $.2(2)	—			—			—			5.6			5.6
Total reclassifications into earnings	—			.5			—			5.6			6.1
Balance at June 30, 2016	$	(862.7	)	$	(.4	)	$	(4.3	)	$	(142.4	)	$	(1,009.8	)

Three Months Ended June 30, 2015:	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Total
Balance at March 31, 2015	$	(803.1	)	$	(2.8	)	$	(4.3	)	$	(523.4	)	$	(1,333.6	)
Other comprehensive income other than reclassifications	21.4			—			—			—			21.4
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0(1)	—			.5			—			—			.5
Amortization of net actuarial loss and prior service cost, net of tax of $.3(2)	—			—			—			13.3			13.3
Total reclassifications into earnings	—			.5			—			13.3			13.8
Balance at June 30, 2015	$	(781.7	)	$	(2.3	)	$	(4.3	)	$	(510.1	)	$	(1,298.4	)

Six Months Ended June 30, 2016:	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Total
Balance at December 31, 2015	$	(950.0	)	$	(1.3	)	$	(4.3	)	$	(410.6	)	$	(1,366.2	)
Other comprehensive income (loss) other than reclassifications	16.0			—			—			(14.1		)	1.9
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0(1)	—			.9			—			—			.9
Amortization of net actuarial loss and prior service cost, net of tax of $.4(2)	—			—			—			12.3			12.3
Deconsolidation of Venezuela, net of tax of $0.0	81.3			—			—			.8			82.1
Separation of North America, net of tax of $10.2	(10.0		)	—			—			269.2			259.2
Total reclassifications into earnings	71.3			.9			—			282.3			354.5
Balance at June 30, 2016	$	(862.7	)	$	(.4	)	$	(4.3	)	$	(142.4	)	$	(1,009.8	)

Six Months Ended June 30, 2015:	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Total
Balance at December 31, 2014	$	(677.0	)	$	(3.2	)	$	(4.3	)	$	(533.1	)	$	(1,217.6	)
Other comprehensive loss other than reclassifications	(104.7		)	—			—			(3.6		)	(108.3		)
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0(1)	—			.9			—			—			.9
Amortization of net actuarial loss and prior service cost, net of tax of $.6(2)	—			—			—			26.6			26.6
Total reclassifications into earnings	—			.9			—			26.6			27.5
Balance at June 30, 2015	$	(781.7	)	$	(2.3	)	$	(4.3	)	$	(510.1	)	$	(1,298.4	)

(1) Gross amount reclassified to interest expense, and related taxes reclassified to income taxes.

(2) Gross amount reclassified to pension and postretirement expense, within selling, general & administrative expenses, and related taxes reclassified to income taxes.

Foreign exchange net loss of $9.7 and net gain of $10.4 for the three months ended June 30, 2016 and 2015, respectively, and foreign exchange net losses of $10.9 and $8.3 for the six months ended June 30, 2016 and 2015, respectively, resulting from the translation of actuarial losses and prior service cost recorded in AOCI are included in changes in foreign currency translation adjustments in the Consolidated Statements of Comprehensive Income (Loss).

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SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2016

Segment Reporting, Measurement Disclosures [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

We determine segment profit by deducting the related costs and expenses from segment revenue. In order to ensure comparability between periods, segment profit includes an allocation of global marketing expenses based on actual revenues. Segment profit excludes global expenses other than marketing, costs to implement ("CTI") restructuring initiative (see Note 12, Restructuring Initiatives), certain significant asset impairment charges, and other items, which are not allocated to a particular segment, if applicable. This is consistent with the manner in which we assess our performance and allocate resources.

Effective January, 1, 2016, we have updated our reportable segments. Prior periods have been restated to conform with the new presentation. Summarized financial information concerning our reportable segments was as follows:

Total Revenue	Three Months Ended June 30,				Six Months Ended June 30,
	2016		2015		2016		2015
Europe, Middle East & Africa	$	520.9	$	530.1	$	1,041.3	$	1,062.3
South Latin America	535.7		607.5		962.1		1,198.4
North Latin America	224.4		236.0		429.1		465.3
Asia Pacific	141.9		158.0		278.6		322.1
Total revenue from reportable segments	1,422.9		1,531.6		2,711.1		3,048.1
Other operating segments and business activities	11.4		33.3		29.7		68.9
Total revenue	$	1,434.3	$	1,564.9	$	2,740.8	$	3,117.0

Operating Profit	Three Months Ended June 30,						Six Months Ended June 30,
	2016			2015			2016			2015
Segment Profit
Europe, Middle East & Africa	$	83.4		$	73.2		$	152.1		$	137.1
South Latin America	61.0			69.2			84.1			136.9
North Latin America	32.1			31.6			60.6			60.2
Asia Pacific	14.8			16.5			29.5			38.7
Total profit from reportable segments	$	191.3		$	190.5		$	326.3		$	372.9
Other operating segments and business activities	.7			4.9			4.9			10.0
Unallocated global expenses	(87.5		)	(96.6		)	(172.1		)	(183.4		)
CTI restructuring initiatives	(9.4		)	(2.9		)	(56.2		)	(30.1		)
Venezuelan special items	—			(6.2		)	—			(112.6		)
Operating profit	$	95.1		$	89.7		$	102.9		$	56.8

Other operating segments and business activities include the business results for Liz Earle, which was sold in July 2015, and Venezuela, which was deconsolidated effective March 31, 2016. 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.

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SUPPLEMENTAL BALANCE SHEET INFORMATION

6 Months Ended

Jun. 30, 2016

Balance Sheet Related Disclosures [Abstract]

SUPPLEMENTAL BALANCE SHEET INFORMATION

SUPPLEMENTAL BALANCE SHEET INFORMATION

At June 30, 2016 and December 31, 2015, prepaid expenses and other included the following:

Components of Prepaid Expenses and Other	June 30, 2016		December 31, 2015
Prepaid taxes and tax refunds receivable	$	101.9	$	96.3
Receivables other than trade	79.0		69.6
Prepaid brochure costs, paper, and other literature	75.1		64.5
Other	58.0		65.7
Prepaid expenses and other	$	314.0	$	296.1

At June 30, 2016 and December 31, 2015, other assets included the following:

Components of Other Assets	June 30, 2016		December 31, 2015
Long-term receivables	$	214.5	$	162.1
Deferred tax assets	190.0		172.8
Capitalized software	83.9		82.4
Investment in New Avon	38.0		—
Investments	37.2		36.3
Tooling (plates and molds associated with our beauty products)	13.9		15.3
Other	27.0		21.1
Other assets	$	604.5	$	490.0

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RESTRUCTURING INITIATIVES

6 Months Ended

Jun. 30, 2016

Restructuring and Related Activities [Abstract]

RESTRUCTURING INITIATIVES

RESTRUCTURING INITIATIVES

Transformation Plan

In January 2016, we announced the Transformation Plan, which includes cost reduction efforts to continue to improve our cost structure and to enable us to reinvest in growth. As a result of this plan, we have targeted pre-tax annualized cost savings of approximately $350 after three years, with an estimated $200 from supply chain reductions and an estimated $150 from other cost reductions, which are expected to be achieved through restructuring actions, as well as other cost-savings strategies that will not result in restructuring charges. We plan to reinvest a portion of these cost savings in growth initiatives, including media, social selling and information technology systems that will help us modernize our business. We initiated the Transformation Plan in order to enable us to achieve our long-term goals of double-digit operating margin and mid single-digit Constant $ revenue growth. As part of the Transformation Plan, we identified certain actions, that we believe will reduce ongoing costs, primarily consisting of global headcount reductions relating to operating model changes. These operating model changes include streamlining of our corporate functions to align with the current and future needs of the business and an information technology infrastructure outsourcing initiative.

As a result of these restructuring actions approved-to-date, we have recorded total costs to implement these restructuring initiatives of $79.9 before taxes, of which $57.5 was recorded in the first six months of 2016, in the Consolidated Statements of Operations. The additional charges not yet incurred associated with the restructuring actions approved to-date of approximately $15 to $25 before taxes are expected to be recorded primarily in 2016. At this time we are unable to quantify the total costs to implement these restructuring initiatives that will be incurred through the time the Transformation Plan is fully implemented. In connection with the restructuring actions approved to-date associated with the Transformation Plan, we expect to realize annualized savings of approximately $90 to $100 (before tax). We expect to realize approximately $25 of savings in 2016 and are expected to achieve the significant majority of the annualized savings beginning in 2017. The annualized savings represent the net reduction of expenses that will no longer be incurred by Avon.

Restructuring Charges - Three and Six Months Ended June 30, 2016

During the three and six months ended June 30, 2016, we recorded costs to implement of $10.0 and $57.5, respectively, related to the Transformation Plan, in the Consolidated Statement of Operations. The costs consisted of the following:

• net charges of $2.8 and $49.9, respectively, primarily for employee-related costs, including severance benefits;

• contract termination and other net charges of $4.6 and $4.6, respectively;

• implementation costs of $1.1 and $1.5, respectively, primarily related to professional service fees;

• accelerated depreciation of $1.2 and $1.2, respectively; and

• inventory write-offs of $.3 and $.3, respectively.

Of the total costs to implement during the three months ended June 30, 2016, $9.7 was recorded in selling, general and administrative expenses and $.3 was recorded in cost of sales. Of the total costs to implement during the six months ended June 30, 2016, $57.2 was recorded in selling, general and administrative expenses and $.3 was recorded in cost of sales. The majority of cash payments, if applicable, associated with these charges are expected to be made during 2016.

The liability balance for the Transformation Plan as of June 30, 2016 is as follows:

	Employee-Related Costs			Contract Terminations/Other		Total
Balance at December 31, 2015	$	21.4		$	—	$	21.4
2016 charges	57.8			4.6		62.4
Adjustments	(7.9		)	—		(7.9		)
Cash payments	(17.1		)	—		(17.1		)
Foreign exchange	.2			—		.2
Balance at June 30, 2016	$	54.4		$	4.6	$	59.0

The following table presents the restructuring charges incurred to date, under the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plan:

	Employee- Related Costs		Contract Terminations/Other		Foreign Currency Translation Adjustment Write-offs		Total
Charges incurred to date	$	71.3	$	4.6	$	—	$	75.9
Estimated charges to be incurred on approved initiatives	6.3		2.0		2.0		10.3
Total expected charges on approved initiatives	$	77.6	$	6.6	$	2.0	$	86.2

The charges, net of adjustments, of initiatives under the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plan, by reportable business segment were as follows:

	Europe, Middle East & Africa			South Latin America		North Latin America			Asia Pacific		Global & Other Operating Segments		Total
2015	$	—		$	—	$	—		$	—	$	21.4	$	21.4
First quarter 2016	21.9			12.1		3.3			4.7		5.1		47.1
Second quarter 2016	(.1		)	1.0		(.4		)	2.9		4.0		7.4
Charges incurred to date	21.8			13.1		2.9			7.6		30.5		75.9
Estimated charges to be incurred on approved initiatives	1.7			.1		—			2.3		6.2		10.3
Total expected charges on approved initiatives	$	23.5		$	13.2	$	2.9		$	9.9	$	36.7	$	86.2

We expect our total costs to implement restructuring on approved initiatives to be approximately $95 to $105 before taxes under the Transformation Plan. The amounts shown in the tables above as charges recorded to-date relate to initiatives that have been approved and recorded in the financial statements as the costs are probable and estimable. The amounts shown in the tables above as total expected charges on approved initiatives represent charges recorded to-date plus charges yet to be recorded for approved initiatives as the relevant accounting criteria for recording an expense have not yet been met. In addition to the charges included in the tables above, we have incurred and will continue to incur other costs to implement restructuring initiatives such as professional services fees and accelerated depreciation.

Additional Restructuring Charges 2015

As a result of the then-current economic environment, including the impact of foreign currency movements and inflation on our expenses, and in an effort to continue to improve our cost structure, we identified certain actions during 2015 that we believe would reduce ongoing costs. These actions primarily consisted of global headcount reductions.

As a result of these restructuring actions, we recorded a net benefit of $.7 before taxes, during the six months ended June 30, 2016 in selling, general and administrative expenses, in the Consolidated Statements of Operations. There are no material remaining costs for restructuring actions approved-to-date. In connection with these restructuring actions, we realized annualized savings of approximately $30 before taxes. We began to realize savings in the second quarter of 2015 and achieved the annualized savings beginning in the third quarter of 2015. The annualized savings represent the net reduction of expenses that will no longer be incurred by Avon.

Restructuring Charges – Three and Six Months Ended June 30, 2016

The costs to implement recorded during the three and six months ended June 30, 2016 consisted of net benefits of $.2 and $.7, respectively, primarily for employee-related costs due to severance benefits.

Restructuring Charges – Three and Six Months Ended June 30, 2015

The costs to implement recorded during the three and six months ended June 30, 2015 consisted of the following:

• a benefit of $.3 and a charge of $24.7, respectively, for employee-related costs due to severance benefits; and

• implementation costs of $3.5 and $5.4, respectively, primarily for professional service fees associated with Corporate and Asia Pacific.

The liability balance, which consists of employee-related costs, for these various restructuring initiatives as of June 30, 2016 is as follows:

	Total
Balance at December 31, 2015	$	4.0
2016 charges	—
Adjustments	(.7		)
Cash payments	(1.5		)
Foreign exchange	—
Balance at June 30, 2016	$	1.8

The majority of cash payments associated with this liability are expected to be made during 2016.

The charges, net of adjustments, of these various restructuring initiatives, by reportable business segment were as follows:

	Europe, Middle East & Africa		South Latin America		North Latin America		Asia Pacific			Global & Other Operating Segments			Total
2015	$	4.2	$	2.7	$	.2	$	5.8		$	9.2		$	22.1
First Quarter 2016	—		—		—		(.1		)	(.4		)	(.5		)
Second Quarter 2016	—		—		—		—			(.2		)	(.2		)
Charges incurred to date	$	4.2	$	2.7	$	.2	$	5.7		$	8.6		$	21.4

In addition to the charges included in the tables above, we have incurred other costs to implement restructuring initiatives such as professional services fees.

Other Restructuring Initiatives

During the three and six months ended June 30, 2016, we recorded net benefits of $.4 and $.6, respectively, in selling, general and administrative expenses, in the Consolidated Statements of Operations, associated with the restructuring programs launched in 2005 and 2009 and the restructuring initiatives launched in 2012 (the "Other Restructuring Initiatives" and "$400M Cost Savings Initiative"), which are substantially complete. During the three and six months ended June 30, 2015, we recorded net benefits of $.3 and an immaterial amount, respectively, in selling, general and administrative expenses, in the Consolidated Statements of Operations, associated with the Other Restructuring Initiatives. The liability balance associated with the Other Restructuring Initiatives, which primarily consists of employee-related costs and contract termination costs, as of June 30, 2016 is not material.

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GOODWILL

6 Months Ended

Jun. 30, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL

GOODWILL

Goodwill

	Europe, Middle East & Africa			South Latin America		Asia Pacific			Total
Gross balance at December 31, 2015	$	27.7		$	68.9	$	85.0		$	181.6
Accumulated impairments	(6.9		)	—		(82.4		)	(89.3		)
Net balance at December 31, 2015	$	20.8		$	68.9	$	2.6		$	92.3
Changes during the period ended June 30, 2016:
Foreign exchange	(.1		)	3.9		—			3.8
Gross balance at June 30, 2016	$	27.6		$	72.8	$	85.0		$	185.4
Accumulated impairments	(6.9		)	—		(82.4		)	(89.3		)
Net balance at June 30, 2016	$	20.7		$	72.8	$	2.6		$	96.1

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FAIR VALUE

6 Months Ended

Jun. 30, 2016

Fair Value Disclosures [Abstract]

FAIR VALUE

FAIR VALUE

Assets and Liabilities Recorded at Fair Value

The fair value measurement provisions required by GAAP establish a fair value hierarchy, which prioritizes the inputs used in measuring fair value into three broad levels as follows:

• Level 1 - Quoted prices in active markets for identical assets or liabilities.

• Level 2 - Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly.

• Level 3 - Unobservable inputs based on our own assumptions.

Assets and Liabilities Recorded at Fair Value on a Recurring Basis

The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of June 30, 2016:

	Level 1		Level 2		Total
Assets:
Available-for-sale securities	$	2.8	$	—	$	2.8
Foreign exchange forward contracts	—		.1		.1
Total	$	2.8	$	.1	$	2.9
Liabilities:
Foreign exchange forward contracts	$	—	$	4.9	$	4.9
Total	$	—	$	4.9	$	4.9

The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis

as of December 31, 2015:

	Level 1		Level 2		Total
Assets:
Available-for-sale securities	$	—	$	—	$	—
Foreign exchange forward contracts	—		1.2		1.2
Total	$	—	$	1.2	$	1.2
Liabilities:
Foreign exchange forward contracts	$	—	$	1.1	$	1.1
Total	$	—	$	1.1	$	1.1

Fair Value of Financial Instruments

Our financial instruments include cash and cash equivalents, available-for-sale securities, short-term investments, accounts receivable, loans receivable, debt maturing within one year, accounts payable, long-term debt and foreign exchange forwards 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, 2016 and December 31, 2015, respectively, consisted of the following:

	June 30, 2016						December 31, 2015
	Carrying Amount			Fair Value			Carrying Amount			Fair Value
Available-for-sale securities	$	2.8		$	2.8		$	2.8		$	2.8
Debt maturing within one year(1)	(48.8		)	(48.8		)	(55.2		)	(55.2		)
Long-term debt(1)	(2,139.6		)	(1,755.5		)	(2,150.5		)	(1,622.7		)
Foreign exchange forward contracts	(4.8		)	(4.8		)	.1			.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.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

6 Months Ended

Jun. 30, 2016

General Discussion of Derivative Instruments and Hedging Activities [Abstract]

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

We operate globally, with manufacturing and distribution facilities in various countries around the world. We may reduce our exposure to fluctuations in the fair value and cash flows associated with changes in interest rates and foreign exchange rates by creating offsetting positions, including through the use of derivative financial instruments. If we use foreign currency-rate sensitive and interest-rate sensitive instruments to hedge a certain portion of our existing and forecasted transactions, we would expect that any gain or loss in value of the hedge instruments generally would be offset by decreases or increases in the value of the underlying forecasted transactions. As of June 30, 2016, we do not have any interest-rate swap agreements.

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 on the Consolidated Balance Sheets at their fair values. The following table presents the fair value of derivative instruments outstanding at June 30, 2016:

	Asset			Liability
	Balance Sheet Classification	Fair Value		Balance Sheet Classification	Fair Value
Derivatives not designated as hedges:
Foreign exchange forward contracts	Prepaid expenses and other	$	.1	Accounts payable	$	4.9
Total derivatives not designated as hedges		$	.1		$	4.9
Total derivatives		$	.1		$	4.9

The following table presents the fair value of derivative instruments outstanding at December 31, 2015:

	Asset			Liability
	Balance Sheet Classification	Fair Value		Balance Sheet Classification	Fair Value
Derivatives not designated as hedges:
Foreign exchange forward contracts	Prepaid expenses and other	$	1.2	Accounts payable	$	1.1
Total derivatives not designated as hedges		$	1.2		$	1.1
Total derivatives		$	1.2		$	1.1

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. At times, we may de-designate the hedging relationship of a receive-fixed/pay-variable interest-rate swap agreement. In these cases, we enter into receive-variable/pay-fixed interest-rate swap agreements that are designated to offset the gain or loss on the de-designated contract. As of June 30, 2016, we do not have any interest-rate swap agreements. Approximately 2% of our debt portfolio at June 30, 2016 and December 31, 2015 was exposed to floating interest rates.

In January 2013, we terminated eight of our interest-rate swap agreements previously designated as fair value hedges, with notional amounts totaling $1,000. As of the interest-rate swap agreements’ termination date, the aggregate favorable adjustment to the carrying value (deferred gain) of our debt was $90.4, which is being amortized as a reduction to interest expense over the remaining term of the underlying debt obligations. The net impact of the gain amortization was $3.7 and $7.4, respectively, for the three and six months ended June 30, 2016, and $3.6 and $7.3, respectively, for the three and six months ended June 30, 2015. The interest-rate swap agreements were terminated in order to improve our capital structure, including increasing our ratio of fixed-rate debt. At June 30, 2016, the unamortized deferred gain associated with the January 2013 interest-rate swap termination was $28.0, and was classified within long-term debt in the Consolidated Balance Sheets.

In March 2012, we terminated two of our interest-rate swap agreements previously designated as fair value hedges, with notional amounts totaling $350. As of the interest-rate swap agreements’ termination date, the aggregate favorable adjustment to the carrying value (deferred gain) of our debt was $46.1, which is being amortized as a reduction to interest expense over the remaining term of the underlying debt obligations through March 2019. The net impact of the gain amortization was $1.7 and $3.4, respectively, for the three and six months ended June 30, 2016, and $1.7 and $3.3, respectively, for the three and six months ended June 30, 2015. The interest-rate swap agreements were terminated in order to increase our ratio of fixed-rate debt. At June 30, 2016, the unamortized deferred gain associated with the March 2012 interest-rate swap termination was $19.4, and was classified within long-term debt in the Consolidated Balance Sheets.

Foreign Currency Risk

We may use foreign exchange forward contracts to manage a portion of our foreign currency exchange rate exposures. At June 30, 2016, we had outstanding foreign exchange forward contracts with notional amounts totaling approximately $83.2 for various currencies.

We may use foreign exchange forward contracts to manage foreign currency exposure of certain intercompany loans. These contracts are not designated as hedges. The change in fair value of these contracts is immediately recognized in earnings and substantially offsets the foreign currency impact recognized in earnings relating to the associated intercompany loans. During the three and six months ended June 30, 2016, we recorded losses of $5.2 and $7.5, respectively, in other expense, net in the Consolidated Statements of Operations related to these undesignated foreign exchange forward contracts. Also during the three and six months ended June 30, 2016, we recorded gains of $4.6 and $5.4, respectively, related to the associated intercompany loans, caused by changes in foreign currency exchange rates.During the three and six months ended June 30, 2015, we recorded losses of $.9 and $8.9, respectively, in other expense, net in the Consolidated Statements of Operations related to these undesignated foreign exchange forward contracts. During the three and six months ended June 30, 2015, we recorded a loss of $.6 and a gain of $8.1 related to the associated intercompany loans, caused by changes in foreign currency exchange rates.

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Debt

6 Months Ended

Jun. 30, 2016

Debt Disclosure [Abstract]

Debt

DEBT

Revolving Credit Facility

In June 2015, the Company and Avon International Operations, Inc., a wholly-owned domestic subsidiary of the Company (“AIO”), entered into a five-year $400.0 senior secured revolving credit facility (the “2015 facility”). Borrowings under the 2015 facility bear interest, at our option, at a rate per annum equal to LIBOR plus 250 basis points or a floating base rate plus 150 basis points, in each case subject to adjustment based upon a leverage-based pricing grid. As of June 30, 2016, there were no amounts outstanding under the 2015 facility.

All obligations of AIO under the 2015 facility are (i) unconditionally guaranteed by each material domestic restricted subsidiary of the Company (other than AIO, the borrower), in each case, subject to certain exceptions and (ii) guaranteed on a limited recourse basis by the Company. The obligations of AIO and the guarantors are secured by first priority liens on and security interest in substantially all of the assets of AIO and the subsidiary guarantors and by certain assets of the Company, in each case, subject to certain exceptions.

The 2015 facility will terminate in June 2020; provided, however, that it shall terminate on the 91^st day prior to the maturity of the 2018 Notes (as defined below), the 4.20% Notes (as defined below), the 2019 Notes (as defined below) and the 4.60% Notes (as defined below), if on such 91^st day, the applicable notes are not redeemed, repaid, discharged, defeased or otherwise refinanced in full.

The 2015 facility contains affirmative and negative covenants, which are customary for secured financings of this type, as well as financial covenants (interest coverage and total leverage ratios). As of June 30, 2016, we were in compliance with our interest coverage and total leverage ratios under the 2015 facility. The amount of the facility available to be drawn down on is reduced by any standby letters of credit granted by AIO. AIO has issued approximately $38 of standby letters of credit. As of June 30, 2016, based on then applicable interest rates, approximately $335 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; and $250.0 principal amount of 6.95% Notes due March 15, 2043 (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 with S&P and Moody's. As described in the indenture, the interest rates on the 2013 Notes increase by .25% for each one-notch downgrade below investment grade on each of our long-term credit ratings assigned to the 2013 Notes by S&P or Moody's. These adjustments are limited to a total increase of 2% above the respective interest rates in effect on the date of issuance of the 2013 Notes. As a result of the long-term credit rating downgrades by S&P and Moody's in 2014, 2015 and 2016, the interest rates on the 2013 Notes increased by a total of 2%, and as such, we have reached the maximum allowable increase in interest rates on these Notes, with the last .25% effective as of September 15, 2016.

At June 30, 2016, we also have outstanding $250.0 principal amount of our 5.75% Notes due March 1, 2018 (the "2018 Notes"); $250.0 principal amount of our 4.20% Notes due July 15, 2018 (the "4.20% Notes"); and $350.0 principal amount of our 6.50% Notes due March 1, 2019 (the "2019 Notes"), with interest on each series of these Notes payable semi-annually.

The indentures governing our outstanding notes described above contain certain customary covenants and customary events of default and cross-default provisions. Further, we would be required to make an offer to repurchase all of our outstanding notes described above, with the exception of our 4.20% Notes, at a price equal to 101% of their aggregate principal amount plus accrued and unpaid interest in the event Avon undergoes a change of control and, at such time, the outstanding notes are rated below investment grade.

Long-Term Credit Ratings

Our long-term credit ratings are Ba3 (Negative Outlook) for corporate family debt, and B1 (Negative Outlook) for senior unsecured debt, with Moody's; B (Stable Outlook) with S&P; and B+ (Negative Outlook) with Fitch, which are below investment grade. We do not believe these long-term credit ratings will have a material impact on our near-term liquidity. However, any rating agency reviews could result in a change in outlook or downgrade, which could further limit our access to new financing, particularly short-term financing, reduce our flexibility with respect to working capital needs, affect the market price of some or all of our outstanding debt securities, and likely result in an increase in financing costs, and less favorable covenants and financial terms under our financing arrangements.

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ACCOUNTING POLICIES (Policy)

6 Months Ended

Jun. 30, 2016

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 2015 Annual Report on Form 10-K ("2015 Form 10-K") in preparing these unaudited financial statements. In our opinion, the unaudited interim consolidated financial statements reflect all adjustments of a normal recurring nature that are necessary for a fair statement of the results for the interim periods presented. Results for interim periods are not necessarily indicative of results for a full year. You should read these unaudited interim consolidated financial statements in conjunction with our consolidated financial statements contained in our 2015 Form 10-K. When used in this report, the terms "Avon," "Company," "we" or "us" mean Avon Products, Inc.

For interim consolidated financial statement purposes we provide for accruals under our various employee benefit plans for each quarter based on one quarter of the estimated annual expense. In addition, our tax provision is determined using an estimate of our consolidated annual effective tax rate, adjusted in the current period for discrete tax items including:

• the effects of significant, unusual or extraordinary pretax and tax items, if any;

• withholding taxes associated with current period cash repatriations; and

• the impact of loss-making subsidiaries for which we cannot recognize a tax benefit and subsidiaries that reduce the reliability of the estimated annual consolidated effective tax rate.

Venezuela

Venezuela

Venezuela's restrictive foreign exchange control regulations and our Venezuelan operations' increasingly limited access to U.S. dollars have resulted in an other-than-temporary lack of exchangeability between the Venezuelan bolivar and the U.S. dollar, and have restricted our Venezuelan operations' ability to pay dividends and settle intercompany obligations. The severe currency controls imposed by the Venezuelan government have significantly limited our ability to realize the benefits from earnings of our Venezuelan operations and access the resulting liquidity provided by those earnings. We expected that this other-than-temporary lack of exchangeability would continue for the foreseeable future, and as a result, we concluded that, effective March 31, 2016, we did not meet the accounting criteria of control in order to continue consolidating our Venezuelan operations and, as a result, account for our Venezuelan operations using the cost method of accounting. Our Consolidated Balance Sheets no longer includes the assets and liabilities of our Venezuelan operations and we no longer include the results of our Venezuelan operations in our Consolidated Financial Statements.

As a result of the change to the cost method of accounting, in the first quarter of 2016, we recorded a loss of approximately $120 in other expense, net. The loss was comprised of approximately $39 in net assets of the Venezuelan business and approximately $81 in accumulated foreign currency translation adjustments within AOCI (shareholders' deficit) associated with foreign currency changes before Venezuela was accounted for as a highly inflationary economy. The nets assets of the Venezuelan business were comprised of inventories of approximately $24, property, plant and equipment, net of approximately $15, other assets of approximately $11, cash of approximately $5, accounts receivable of approximately $4, and accounts payable and accrued liabilities of approximately $20.

In February 2015, the Venezuelan government announced the creation of a new foreign exchange system referred to as the SIMADI exchange ("SIMADI"). SIMADI began operating on February 12, 2015. There were multiple legal mechanisms in Venezuela to exchange currency. As SIMADI represented the rate which better reflected the economics of Avon Venezuela's business activity, in comparison to the other available exchange rates, we concluded that we should utilize the SIMADI exchange rate to remeasure our Venezuelan operations effective February 12, 2015. As a result of the change to the SIMADI rate, which caused the recognition of a devaluation of approximately 70% as compared to the exchange rate we had used previously, we recorded an after-tax benefit of approximately $3 (a benefit of approximately $4 in other expense, net, and a loss of approximately $1 in income taxes) in the first quarter of 2015, primarily reflecting the write-down of net monetary assets. In addition, as a result of using the historical U.S. dollar cost basis of non-monetary assets, such as inventories, these assets continued to be remeasured, following the change to the SIMADI rate, at the applicable rate at the time of their acquisition. The remeasurement of non-monetary assets at the historical U.S. dollar cost basis caused a disproportionate expense as these assets were consumed in operations, negatively impacting operating profit and net income by approximately $11 during the six months ended June 30, 2015. Also as a result of the change to the SIMADI rate, we determined that an adjustment of approximately $11 to cost of sales was needed to reflect certain non-monetary assets, primarily inventories, at their net realizable value, which was recorded in the first quarter of 2015.

In addition, at February 12, 2015, we reviewed Avon Venezuela's long-lived assets to determine whether the carrying amount of the assets was recoverable. Based on our expected cash flows associated with the asset group, we determined that the carrying amount of the assets, carried at their historical U.S. dollar cost basis, was not recoverable. As such, an impairment charge of approximately $90 to selling, general and administrative expenses was needed to reflect the write-down of the long-lived assets to their estimated fair value of $15.7, which was recorded in the first quarter of 2015. The fair value of Avon Venezuela's long-lived assets was determined using both market and cost valuation approaches. The valuation analysis performed required several estimates, including market conditions and inflation rates.

New Accounting Standards

Accounting Standards Implemented

In April 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-03, Interest-Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs, which requires debt issuance costs to be presented in the balance sheet as a direct reduction from the associated debt liability rather than as an asset. We adopted this standard for the first fiscal quarter of 2016 and applied it retrospectively to all periods presented. Accordingly, $9.1 of debt issuance costs are reflected within long-term debt as of December 31, 2015. These costs were previously recorded within other assets.

Accounting Standards to be Implemented

In February 2016, the FASB issued ASU 2016-02, Leases, which requires all assets and liabilities arising from leases to be recognized in the statement of financial position. This standard is effective as of January 1, 2019. We are currently evaluating the effect that adopting this new accounting guidance will have on our consolidated financial statements.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, issued as a new Topic, Accounting Standards Codification Topic 606. The core principle of the guidance is that a Company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14, Deferral of the Effective Date, which resulted in the standard being effective beginning in 2018, with early adoption permitted in the beginning of 2017. This standard has been amended, and as amended, can be adopted either retrospectively or as a cumulative-effect adjustment as of the date of adoption. We are currently evaluating the effect that adopting this new accounting guidance will have on our consolidated financial statements.

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EARNINGS (LOSS) PER SHARE AND SHARE REPURCHASES (Tables)

6 Months Ended

Jun. 30, 2016

Earnings Per Share Reconciliation [Abstract]

Components of Basic and Diluted Earnings per Share

	Three Months Ended June 30,						Six Months Ended June 30,
(Shares in millions)	2016			2015			2016			2015
Numerator from continuing operations:
Income (loss) from continuing operations, less amounts attributable to noncontrolling interests	$	35.6		$	28.0		$	(120.7	)	$	(115.5	)
Less: (Earnings) loss allocated to participating securities	(.5		)	(.1		)	1.7			2.3
Less: Earnings allocated to convertible preferred stock	(5.9		)	—			(7.3		)	—
Income (loss) from continuing operations allocated to common shareholders	29.2			27.9			(126.3		)	(113.2		)
Numerator from discontinued operations:
(Loss) income from discontinued operations	$	(2.6	)	$	.8		$	(12.2	)	$	(3.0	)
Less: Loss allocated to participating securities	—			.4			.2			.7
(Loss) income allocated to common shareholders	(2.6		)	1.2			(12.0		)	(2.3		)
Numerator attributable to Avon:
Net income (loss) attributable to Avon	$	33.0		$	28.8		$	(132.9	)	$	(118.5	)
Less: (Earnings) loss allocated to participating securities	(.4		)	(.1		)	1.8			2.3
Less: Earnings allocated to convertible preferred stock	(5.9		)	—			(7.3		)	—
Income (loss) allocated to common shareholders	26.7			28.7			(138.4		)	(116.2		)
Denominator:
Basic EPS weighted-average shares outstanding	436.9			435.2			436.4			435.0
Diluted effect of assumed conversion of stock options	—			—			—			—
Diluted effect of assumed conversion of preferred stock	—			—			—			—
Diluted EPS adjusted weighted-average shares outstanding	436.9			435.2			436.4			435.0
Earnings (Loss) per Common Share from continuing operations:
Basic	$	.07		$	.06		$	(.29	)	$	(.26	)
Diluted	.07			.06			(.29		)	(.26		)
Loss per Common Share from discontinued operations:
Basic	$	(.01	)	$	—		$	(.03	)	$	(.01	)
Diluted	(.01		)	—			(.03		)	(.01		)
Earnings (Loss) per Common Share attributable to Avon:
Basic	$	.06		$	.07		$	(.32	)	$	(.27	)
Diluted	.06			.07			(.32		)	(.27		)

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DISCONTINUED OPERATIONS (Tables)

6 Months Ended

Jun. 30, 2016

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 North America are shown below:

	Three Months Ended June 30,						Six Months Ended June 30,
	2016			2015			2016			2015
Total revenue	$	—		$	258.5		$	135.2		$	500.6
Cost of sales	—			102.4			53.2			197.9
Selling, general and administrative expenses	1.2			154.0			89.0			305.3
Operating (loss) profit	(1.2		)	2.1			(7.0		)	(2.6		)
Other (expense) income items	—			(.2		)	.6			(1.4		)
Loss on sale of discontinued operations, before tax	(1.4		)	—			(16.3		)	—
(Loss) income from discontinued operations, before tax	(2.6		)	1.9			(22.7		)	(4.0		)
Income taxes	—			(1.1		)	10.5			1.0
(Loss) income from discontinued operations, net of tax	$	(2.6	)	$	.8		$	(12.2	)	$	(3.0	)

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INVENTORIES (Tables)

6 Months Ended

Jun. 30, 2016

Inventory, Net [Abstract]

Components of Inventories

Components of Inventories	June 30, 2016		December 31, 2015
Raw materials	$	206.6	$	180.5
Finished goods	458.9		443.5
Total	$	665.5	$	624.0

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EMPLOYEE BENEFIT PLANS (Tables)

6 Months Ended

Jun. 30, 2016

General Discussion of Pension and Other Postretirement Benefits [Abstract]

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
	2016			2015			2016			2015			2016			2015
Service cost	$	1.3		$	2.9		$	1.3		$	1.4		$	—		$	.1
Interest cost	.8			6.2			5.7			5.7			.3			.9
Expected return on plan assets	(1.0		)	(8.3		)	(8.7		)	(9.1		)	—			—
Amortization of prior service credit	—			(.2		)	—			—			—			(1.0		)
Amortization of net actuarial losses	1.6			11.5			1.7			2.1			(.1		)	.5
Settlements/curtailments	—			—			—			—			—			—
Net periodic benefit costs(1)	$	2.7		$	12.1		$	—		$	.1		$	.2		$	.5

	Six Months Ended June 30,
	Pension Benefits
Net Periodic Benefit Costs	U.S. Plans						Non-U.S. Plans						Postretirement Benefits
	2016			2015			2016			2015			2016			2015
Service cost	$	3.6		$	6.5		$	2.6		$	2.9		$	.1		$	.3
Interest cost	5.1			12.5			11.7			11.6			.9			1.8
Expected return on plan assets	(6.2		)	(16.6		)	(17.5		)	(18.2		)	—			—
Amortization of prior service credit	(.1		)	(.4		)	—			—			(.9		)	(2.0		)
Amortization of net actuarial losses	7.7			23.1			3.4			4.2			.1			1.0
Settlements/curtailments	.1			—			—			—			—			—
Net periodic benefit costs(1)	$	10.2		$	25.1		$	.2		$	.5		$	.2		$	1.1

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

6 Months Ended

Jun. 30, 2016

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, 2016 and 2015:

Three Months Ended June 30, 2016:	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Total
Balance at March 31, 2016	$	(854.8	)	$	(.9	)	$	(4.3	)	$	(146.6	)	$	(1,006.6	)
Other comprehensive loss other than reclassifications	(7.9		)	—			—			(1.4		)	(9.3		)
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0(1)	—			.5			—			—			.5
Amortization of net actuarial loss and prior service cost, net of tax of $.2(2)	—			—			—			5.6			5.6
Total reclassifications into earnings	—			.5			—			5.6			6.1
Balance at June 30, 2016	$	(862.7	)	$	(.4	)	$	(4.3	)	$	(142.4	)	$	(1,009.8	)

Three Months Ended June 30, 2015:	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Total
Balance at March 31, 2015	$	(803.1	)	$	(2.8	)	$	(4.3	)	$	(523.4	)	$	(1,333.6	)
Other comprehensive income other than reclassifications	21.4			—			—			—			21.4
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0(1)	—			.5			—			—			.5
Amortization of net actuarial loss and prior service cost, net of tax of $.3(2)	—			—			—			13.3			13.3
Total reclassifications into earnings	—			.5			—			13.3			13.8
Balance at June 30, 2015	$	(781.7	)	$	(2.3	)	$	(4.3	)	$	(510.1	)	$	(1,298.4	)

Six Months Ended June 30, 2016:	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Total
Balance at December 31, 2015	$	(950.0	)	$	(1.3	)	$	(4.3	)	$	(410.6	)	$	(1,366.2	)
Other comprehensive income (loss) other than reclassifications	16.0			—			—			(14.1		)	1.9
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0(1)	—			.9			—			—			.9
Amortization of net actuarial loss and prior service cost, net of tax of $.4(2)	—			—			—			12.3			12.3
Deconsolidation of Venezuela, net of tax of $0.0	81.3			—			—			.8			82.1
Separation of North America, net of tax of $10.2	(10.0		)	—			—			269.2			259.2
Total reclassifications into earnings	71.3			.9			—			282.3			354.5
Balance at June 30, 2016	$	(862.7	)	$	(.4	)	$	(4.3	)	$	(142.4	)	$	(1,009.8	)

Six Months Ended June 30, 2015:	Foreign Currency Translation Adjustments			Cash Flow Hedges			Net Investment Hedges			Pension and Postretirement Benefits			Total
Balance at December 31, 2014	$	(677.0	)	$	(3.2	)	$	(4.3	)	$	(533.1	)	$	(1,217.6	)
Other comprehensive loss other than reclassifications	(104.7		)	—			—			(3.6		)	(108.3		)
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax of $0.0(1)	—			.9			—			—			.9
Amortization of net actuarial loss and prior service cost, net of tax of $.6(2)	—			—			—			26.6			26.6
Total reclassifications into earnings	—			.9			—			26.6			27.5
Balance at June 30, 2015	$	(781.7	)	$	(2.3	)	$	(4.3	)	$	(510.1	)	$	(1,298.4	)

(1) Gross amount reclassified to interest expense, and related taxes reclassified to income taxes.

(2) Gross amount reclassified to pension and postretirement expense, within selling, general & administrative expenses, and related taxes reclassified to income taxes.

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SEGMENT INFORMATION (Tables)

6 Months Ended

Jun. 30, 2016

Segment Reporting, Measurement Disclosures [Abstract]

Total Revenue and Operating Profit by Reporting Segment

Summarized financial information concerning our reportable segments was as follows:

Total Revenue	Three Months Ended June 30,				Six Months Ended June 30,
	2016		2015		2016		2015
Europe, Middle East & Africa	$	520.9	$	530.1	$	1,041.3	$	1,062.3
South Latin America	535.7		607.5		962.1		1,198.4
North Latin America	224.4		236.0		429.1		465.3
Asia Pacific	141.9		158.0		278.6		322.1
Total revenue from reportable segments	1,422.9		1,531.6		2,711.1		3,048.1
Other operating segments and business activities	11.4		33.3		29.7		68.9
Total revenue	$	1,434.3	$	1,564.9	$	2,740.8	$	3,117.0

Operating Profit	Three Months Ended June 30,						Six Months Ended June 30,
	2016			2015			2016			2015
Segment Profit
Europe, Middle East & Africa	$	83.4		$	73.2		$	152.1		$	137.1
South Latin America	61.0			69.2			84.1			136.9
North Latin America	32.1			31.6			60.6			60.2
Asia Pacific	14.8			16.5			29.5			38.7
Total profit from reportable segments	$	191.3		$	190.5		$	326.3		$	372.9
Other operating segments and business activities	.7			4.9			4.9			10.0
Unallocated global expenses	(87.5		)	(96.6		)	(172.1		)	(183.4		)
CTI restructuring initiatives	(9.4		)	(2.9		)	(56.2		)	(30.1		)
Venezuelan special items	—			(6.2		)	—			(112.6		)
Operating profit	$	95.1		$	89.7		$	102.9		$	56.8

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SUPPLEMENTAL BALANCE SHEET INFORMATION (Tables)

6 Months Ended

Jun. 30, 2016

Balance Sheet Related Disclosures [Abstract]

Components of Prepaid Expenses and Other

At June 30, 2016 and December 31, 2015, prepaid expenses and other included the following:

Components of Prepaid Expenses and Other	June 30, 2016		December 31, 2015
Prepaid taxes and tax refunds receivable	$	101.9	$	96.3
Receivables other than trade	79.0		69.6
Prepaid brochure costs, paper, and other literature	75.1		64.5
Other	58.0		65.7
Prepaid expenses and other	$	314.0	$	296.1

Components of Other Assets

At June 30, 2016 and December 31, 2015, other assets included the following:

Components of Other Assets	June 30, 2016		December 31, 2015
Long-term receivables	$	214.5	$	162.1
Deferred tax assets	190.0		172.8
Capitalized software	83.9		82.4
Investment in New Avon	38.0		—
Investments	37.2		36.3
Tooling (plates and molds associated with our beauty products)	13.9		15.3
Other	27.0		21.1
Other assets	$	604.5	$	490.0

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RESTRUCTURING INITIATIVES (Tables)

6 Months Ended

Jun. 30, 2016

Transformation Plan [Member]

Restructuring Cost and Reserve [Line Items]

Schedule of Restructuring Reserve by Type of Cost

The liability balance for the Transformation Plan as of June 30, 2016 is as follows:

	Employee-Related Costs			Contract Terminations/Other		Total
Balance at December 31, 2015	$	21.4		$	—	$	21.4
2016 charges	57.8			4.6		62.4
Adjustments	(7.9		)	—		(7.9		)
Cash payments	(17.1		)	—		(17.1		)
Foreign exchange	.2			—		.2
Balance at June 30, 2016	$	54.4		$	4.6	$	59.0

Restructuring and Related Costs

The following table presents the restructuring charges incurred to date, under the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plan:

	Employee- Related Costs		Contract Terminations/Other		Foreign Currency Translation Adjustment Write-offs		Total
Charges incurred to date	$	71.3	$	4.6	$	—	$	75.9
Estimated charges to be incurred on approved initiatives	6.3		2.0		2.0		10.3
Total expected charges on approved initiatives	$	77.6	$	6.6	$	2.0	$	86.2

Schedule of Restructuring Charges Reportable by Business Segment

of initiatives under the Transformation Plan, along with the estimated charges expected to be incurred on approved initiatives under the plan, by reportable business segment were as follows:

	Europe, Middle East & Africa			South Latin America		North Latin America			Asia Pacific		Global & Other Operating Segments		Total
2015	$	—		$	—	$	—		$	—	$	21.4	$	21.4
First quarter 2016	21.9			12.1		3.3			4.7		5.1		47.1
Second quarter 2016	(.1		)	1.0		(.4		)	2.9		4.0		7.4
Charges incurred to date	21.8			13.1		2.9			7.6		30.5		75.9
Estimated charges to be incurred on approved initiatives	1.7			.1		—			2.3		6.2		10.3
Total expected charges on approved initiatives	$	23.5		$	13.2	$	2.9		$	9.9	$	36.7	$	86.2

Other Restructuring Initiatives 2015 [Member]

Restructuring Cost and Reserve [Line Items]

Schedule of Restructuring Reserve by Type of Cost

The liability balance, which consists of employee-related costs, for these various restructuring initiatives as of June 30, 2016 is as follows:

	Total
Balance at December 31, 2015	$	4.0
2016 charges	—
Adjustments	(.7		)
Cash payments	(1.5		)
Foreign exchange	—
Balance at June 30, 2016	$	1.8

Schedule of Restructuring Charges Reportable by Business Segment

	Europe, Middle East & Africa		South Latin America		North Latin America		Asia Pacific			Global & Other Operating Segments			Total
2015	$	4.2	$	2.7	$	.2	$	5.8		$	9.2		$	22.1
First Quarter 2016	—		—		—		(.1		)	(.4		)	(.5		)
Second Quarter 2016	—		—		—		—			(.2		)	(.2		)
Charges incurred to date	$	4.2	$	2.7	$	.2	$	5.7		$	8.6		$	21.4

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GOODWILL (Tables)

6 Months Ended

Jun. 30, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

Goodwill

	Europe, Middle East & Africa			South Latin America		Asia Pacific			Total
Gross balance at December 31, 2015	$	27.7		$	68.9	$	85.0		$	181.6
Accumulated impairments	(6.9		)	—		(82.4		)	(89.3		)
Net balance at December 31, 2015	$	20.8		$	68.9	$	2.6		$	92.3
Changes during the period ended June 30, 2016:
Foreign exchange	(.1		)	3.9		—			3.8
Gross balance at June 30, 2016	$	27.6		$	72.8	$	85.0		$	185.4
Accumulated impairments	(6.9		)	—		(82.4		)	(89.3		)
Net balance at June 30, 2016	$	20.7		$	72.8	$	2.6		$	96.1

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FAIR VALUE (Tables)

6 Months Ended

Jun. 30, 2016

Fair Value Disclosures [Abstract]

Fair Value Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and Liabilities Recorded at Fair Value on a Recurring Basis

The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of June 30, 2016:

	Level 1		Level 2		Total
Assets:
Available-for-sale securities	$	2.8	$	—	$	2.8
Foreign exchange forward contracts	—		.1		.1
Total	$	2.8	$	.1	$	2.9
Liabilities:
Foreign exchange forward contracts	$	—	$	4.9	$	4.9
Total	$	—	$	4.9	$	4.9

The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis

as of December 31, 2015:

	Level 1		Level 2		Total
Assets:
Available-for-sale securities	$	—	$	—	$	—
Foreign exchange forward contracts	—		1.2		1.2
Total	$	—	$	1.2	$	1.2
Liabilities:
Foreign exchange forward contracts	$	—	$	1.1	$	1.1
Total	$	—	$	1.1	$	1.1

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, 2016 and December 31, 2015, respectively, consisted of the following:

	June 30, 2016						December 31, 2015
	Carrying Amount			Fair Value			Carrying Amount			Fair Value
Available-for-sale securities	$	2.8		$	2.8		$	2.8		$	2.8
Debt maturing within one year(1)	(48.8		)	(48.8		)	(55.2		)	(55.2		)
Long-term debt(1)	(2,139.6		)	(1,755.5		)	(2,150.5		)	(1,622.7		)
Foreign exchange forward contracts	(4.8		)	(4.8		)	.1			.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.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

6 Months Ended

Jun. 30, 2016

General Discussion of Derivative Instruments and Hedging Activities [Abstract]

Fair Value of Derivative Instruments Outstanding

Derivatives are recognized on the Consolidated Balance Sheets at their fair values. The following table presents the fair value of derivative instruments outstanding at June 30, 2016:

	Asset			Liability
	Balance Sheet Classification	Fair Value		Balance Sheet Classification	Fair Value
Derivatives not designated as hedges:
Foreign exchange forward contracts	Prepaid expenses and other	$	.1	Accounts payable	$	4.9
Total derivatives not designated as hedges		$	.1		$	4.9
Total derivatives		$	.1		$	4.9

The following table presents the fair value of derivative instruments outstanding at December 31, 2015:

	Asset			Liability
	Balance Sheet Classification	Fair Value		Balance Sheet Classification	Fair Value
Derivatives not designated as hedges:
Foreign exchange forward contracts	Prepaid expenses and other	$	1.2	Accounts payable	$	1.1
Total derivatives not designated as hedges		$	1.2		$	1.1
Total derivatives		$	1.2		$	1.1

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ACCOUNTING POLICIES (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Jun. 30, 2015	Jun. 30, 2016	Dec. 31, 2015	Feb. 12, 2015
Accounting Policies [Line Items]
Venezuela foreign currency devaluation						70.00%
Exchange rate net charges, total		$ (3.0)
Exchange rate net charges on other expense, net		(4.0)
Exchange rate net charges on income taxes		1.0
Venezuelan non-monetary assets remeasurement in operating profit			$ 11.0
Charge for Venezuelan non-monetary assets to their net realizable value		11.0
Property, plant and equipment at carrying value				$ 743.3	$ 766.9
Other Assets [Member] | Accounting Standards Update 2015-03 [Member]
Accounting Policies [Line Items]
Deferred Finance Costs, Net					(9.1)
Long-term Debt [Member] | Accounting Standards Update 2015-03 [Member]
Accounting Policies [Line Items]
Deferred Finance Costs, Net					$ 9.1
Avon Venezuela [Member]
Accounting Policies [Line Items]
Net assets of the Venezuelan business	$ 39.0
Loss from foreign currency translation adjustments	81.0
Impairment of Venezuela long-lived assets		90.0
Property, plant and equipment at carrying value		$ 15.7
Avon Venezuela [Member] | Property, Plant and Equipment [Member]
Accounting Policies [Line Items]
Net assets of the Venezuelan business	24.0
Avon Venezuela [Member] | Other Assets [Member]
Accounting Policies [Line Items]
Net assets of the Venezuelan business	15.0
Avon Venezuela [Member] | Cash [Member]
Accounting Policies [Line Items]
Net assets of the Venezuelan business	11.0
Avon Venezuela [Member] | Accounts Receivable [Member]
Accounting Policies [Line Items]
Net assets of the Venezuelan business	5.0
Avon Venezuela [Member] | Accounts Payable [Member]
Accounting Policies [Line Items]
Net assets of the Venezuelan business	4.0
Avon Venezuela [Member] | Accrued Liabilities [Member]
Accounting Policies [Line Items]
Net assets of the Venezuelan business	20.0
Avon Venezuela [Member] | Other Expense, Net [Member]
Accounting Policies [Line Items]
Loss from deconsolidation of Venezuela	$ 120.0

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EARNINGS (LOSS) PER SHARE AND SHARE REPURCHASES (Narrative) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Earnings Per Share Reconciliation [Abstract]
Antidilutive securities excluded from computation of earnings per share, amount (in shares)	15,200,000	12,200,000
Stock options excluded from computation of earnings per share due to net loss, including options with higher exercise prices than average market price			13,800,000	13,900,000
Converted Series C Convertible Preferred Stock (in shares)	87,100,000		87,051,524
Stock repurchased during the period, shares			900,000	300,000
Stock repurchased during the period, value			$ 3.7	$ 2.5

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EARNINGS (LOSS) PER SHARE AND SHARE REPURCHASES (Components of Basic and Diluted Earnings per Share) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Numerator from continuing operations: [Abstract]
Income (loss) from continuing operations, less amounts attributable to noncontrolling interests	$ 35.6	$ 28.0	$ (120.7)	$ (115.5)
Less: (Earnings) loss allocated to participating securities	(0.5)	(0.1)	1.7	2.3
Less: Earnings allocated to convertible preferred stock	(5.9)	0.0	(7.3)	0.0
Income (loss) from continuing operations allocated to common shareholders	29.2	27.9	(126.3)	(113.2)
Numerator from discontinued operations:
(Loss) income from discontinued operations	(2.6)	0.8	(12.2)	(3.0)
Less: Loss allocated to participating securities	0.0	0.4	0.2	0.7
(Loss) income allocated to common shareholders	(2.6)	1.2	(12.0)	(2.3)
Numerator attributable to Avon:
Net income (loss) attributable to Avon	33.0	28.8	(132.9)	(118.5)
Less: (Earnings) loss allocated to participating securities	(0.4)	(0.1)	1.8	2.3
Less: Earnings allocated to convertible preferred stock	(5.9)	0.0	(7.3)	0.0
Income (loss) allocated to common shareholders	$ 26.7	$ 28.7	$ (138.4)	$ (116.2)
Denominator:
Basic EPS weighted-average shares outstanding	436.9	435.2	436.4	435.0
Diluted effect of assumed conversion of stock options (in shares)	0.0	0.0	0.0	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	436.9	435.2	436.4	435.0
Earnings (Loss) per Common Share from continuing operations:
Basic (in usd per share)	$ 0.07	$ 0.06	$ (0.29)	$ (0.26)
Diluted (in usd per share)	0.07	0.06	(0.29)	(0.26)
Loss per Common Share from discontinued operations:
Basic (in usd per share)	(0.01)	0.00	(0.03)	(0.01)
Diluted (in usd per share)	(0.01)	0.00	(0.03)	(0.01)
Earnings (Loss) per Common Share attributable to Avon:
Basic (in usd per share)	0.07	0.06	(0.29)	(0.26)
Diluted (in usd per share)	$ 0.07	$ 0.06	$ (0.29)	$ (0.26)

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DISCONTINUED OPERATIONS - Additional Information (Details) - USD ($) $ in Millions		3 Months Ended			6 Months Ended
	Dec. 17, 2015	Jun. 30, 2016	Dec. 31, 2015	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
New Avon [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Implied value of ownership interests			$ 43.0
Other Expense, Net [Member] | New Avon [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Loss from equity method investment		$ 0.6			$ 4.5
North America Segment [Member] | Discontinued Operations [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Proceeds from issuance of convertible preferred stock	$ 435.0
Proceeds for issuance of membership interests	$ 170.0
Ownership interest not retained	80.10%
Cash contributed for ownership interest	$ 100.0
Percentage of ownership interest retained	19.90%
Cash received as part of an estimate of working capital adjustment	$ 4.0
Additional loss on sale of discontinued operations, before tax		1.0			16.0
Estimated loss on sale of discontinued operations, net of tax		1.4	340.0	$ 0.0	16.3	$ 0.0
Estimated loss on sale of discontinued operations, before tax			$ 340.0
Additional loss on sale of discontinued operations, net of tax		$ 1.0			$ 6.0

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DISCONTINUED OPERATIONS - Major Classes of Financial Statement Components Comprising the Loss on Discontinued Operations, Net of Tax in North America (Details) - USD ($) $ in Millions	3 Months Ended			6 Months Ended
	Jun. 30, 2016	Dec. 31, 2015	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
(Loss) income from discontinued operations, net of tax	$ (2.6)		$ 0.8	$ (12.2)	$ (3.0)
North America Segment [Member] | Discontinued Operations [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Total revenue	0.0		258.5	135.2	500.6
Cost of sales	0.0		102.4	53.2	197.9
Selling, general and administrative expenses	1.2		154.0	89.0	305.3
Operating (loss) profit	(1.2)		2.1	(7.0)	(2.6)
Other income	0.0			0.6
Other (expense) items			(0.2)		(1.4)
Loss on sale of discontinued operations, before tax	(1.4)	$ (340.0)	0.0	(16.3)	0.0
(Loss) income from discontinued operations, before tax	(2.6)		1.9	(22.7)	(4.0)
Income taxes	0.0		(1.1)	10.5	1.0
(Loss) income from discontinued operations, net of tax	$ (2.6)		$ 0.8	$ (12.2)	$ (3.0)

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RELATED PARTY TRANSACTIONS (Details) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2016 USD ($)	Jun. 30, 2016 USD ($)
Related Party Transaction [Line Items]
Standby letters of credit, recorded liability	$ 38.0	$ 38.0
Equity Method Investee [Member]
Related Party Transaction [Line Items]
Standby letters of credit, recorded liability	2.1	2.1
Equity Method Investee [Member] | Transition Services Agreement [Member]
Related Party Transaction [Line Items]
Selling, general and administrative expenses	(11.0)	(14.9)
Revenue from related party supply agreement	9.8	13.5
Gross profit from related party supply agreement	0.4	0.9
Purchases from related party supply agreement	2.4	3.6
Transformation Plan [Member]
Related Party Transaction [Line Items]
Selling, general and administrative expenses	$ 1.0	$ 1.0

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INVENTORIES (Components of Inventories) (Details) - USD ($) $ in Millions	Jun. 30, 2016	Dec. 31, 2015
Inventory [Line Items]
Raw materials	$ 206.6	$ 180.5
Finished goods	458.9	443.5
Total	$ 665.5	$ 624.0

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EMPLOYEE BENEFIT PLANS (Components of Net Periodic Benefit Cost) (Details) - USD ($) $ in Millions		3 Months Ended		6 Months Ended
		Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Pension Benefits U.S. Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost		$ 1.3	$ 2.9	$ 3.6	$ 6.5
Interest cost		0.8	6.2	5.1	12.5
Expected return on plan assets		(1.0)	(8.3)	(6.2)	(16.6)
Amortization of prior service credit		0.0	(0.2)	(0.1)	(0.4)
Amortization of net actuarial losses		1.6	11.5	7.7	23.1
Settlements/curtailments		0.0	0.0	0.1	0.0
Net periodic benefit costs	[1]	2.7	12.1	10.2	25.1
Pension Benefits Non-U.S. Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost		1.3	1.4	2.6	2.9
Interest cost		5.7	5.7	11.7	11.6
Expected return on plan assets		(8.7)	(9.1)	(17.5)	(18.2)
Amortization of prior service credit		0.0	0.0	0.0	0.0
Amortization of net actuarial losses		1.7	2.1	3.4	4.2
Settlements/curtailments		0.0	0.0	0.0	0.0
Net periodic benefit costs	[1]	0.0	0.1	0.2	0.5
Postretirement Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost		0.0	0.1	0.1	0.3
Interest cost		0.3	0.9	0.9	1.8
Expected return on plan assets		0.0	0.0	0.0	0.0
Amortization of prior service credit		0.0	(1.0)	(0.9)	(2.0)
Amortization of net actuarial losses		(0.1)	0.5	0.1	1.0
Settlements/curtailments		0.0	0.0	0.0	0.0
Net periodic benefit costs	[1]	$ 0.2	0.5	0.2	1.1
Discontinued Operations [Member] | Pension Benefits U.S. Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Net periodic benefit costs			$ 8.3	$ 4.4	$ 17.2

[1] Includes $8.3 of U.S. pension for the three months ended June 30, 2015 and $4.4 and $17.2 of U.S. pension for the six months ended June 30, 2016 and 2015, respectively. Immaterial amounts of the postretirement benefit plans (related to the U.S.) are included in discontinued operations for the three months ended June 30, 2015 and for the six months ended June 30, 2016 and 2015. Amounts associated with the pension and postretirement benefit plans in Canada and the postretirement benefit plan in Puerto Rico, which are included in discontinued operations, have been excluded from all amounts in the tables above.

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EMPLOYEE BENEFIT PLANS (Narrative) (Details) - USD ($) $ in Millions		3 Months Ended		6 Months Ended
		Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Mar. 01, 2016
United States Pension Plan of US Entity, Defined Benefit [Member]
Defined Benefit Plan Disclosure [Line Items]
Net periodic benefit costs	[1]	$ 2.7	$ 12.1	$ 10.2	$ 25.1
U.S. Pension and Postretirement Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Employer contribution				26.0
Estimated contributions for the remainder of fiscal year				1.0
International Pension and Postretirement Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Employer contribution				10.0
Minimum [Member] | International Pension and Postretirement Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Estimated contributions for the remainder of fiscal year				10.0
Maximum [Member] | International Pension and Postretirement Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Estimated contributions for the remainder of fiscal year				15.0
Discontinued Operations [Member] | United States Pension Plan of US Entity, Defined Benefit [Member]
Defined Benefit Plan Disclosure [Line Items]
Net periodic benefit costs			$ 8.3	$ 4.4	$ 17.2
Pension liabilities						$ 499.6
Assets held by the U.S. defined pension plan						358.0
Other postretirement liabilities						$ 60.4

[1] Includes $8.3 of U.S. pension for the three months ended June 30, 2015 and $4.4 and $17.2 of U.S. pension for the six months ended June 30, 2016 and 2015, respectively. Immaterial amounts of the postretirement benefit plans (related to the U.S.) are included in discontinued operations for the three months ended June 30, 2015 and for the six months ended June 30, 2016 and 2015. Amounts associated with the pension and postretirement benefit plans in Canada and the postretirement benefit plan in Puerto Rico, which are included in discontinued operations, have been excluded from all amounts in the tables above.

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SERIES C CONVERTIBLE PREFERRED STOCK (Details) $ / shares in Units, $ in Millions		3 Months Ended	6 Months Ended
	Mar. 01, 2016 USD ($) shares	Jun. 30, 2016 USD ($) $ / shares shares	Jun. 30, 2016 USD ($) director $ / shares shares
Class of Stock [Line Items]
Dividend rate	1.25%
Dividends, Preferred Stock			$ 0.0
Converted Series C Convertible Preferred Stock (in shares) | shares		87,100,000	87,051,524
Liquidation preference (usd per share) | $ / shares		$ 1,000	$ 1,000
Aggregate liquidation preference		$ 435.0	$ 435.0
Initial conversion price (usd per share) | $ / shares		$ 5.00	$ 5.00
Convertible stock, percentage of shares of common stock outstanding		19.99%	19.99%
Conversion of stock, stock price trigger | $ / shares			$ 10.00
Calculation of share repurchase price in the event of default, percentage of liquidation preference		100.00%	100.00%
Minimum [Member]
Class of Stock [Line Items]
Dividend rate			1.25%
Maximum [Member]
Class of Stock [Line Items]
Dividend rate			5.00%
Voting rights on director elections, number of directors | director			3
Private Placement [Member]
Class of Stock [Line Items]
Financial advisory fees and legal expenses		$ 8.7	$ 8.7
Series C Preferred Stock [Member]
Class of Stock [Line Items]
Shares issued | shares	435,000
Shares issued, value	$ 435.0
Dividends Payable		$ 7.3	$ 7.3

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CONTINGENCIES (Details) - USD ($) $ in Millions	6 Months Ended	12 Months Ended
	Jun. 30, 2016	Dec. 31, 2015	Dec. 31, 2014
Assessment for 2012 [Member]
Loss Contingencies [Line Items]
Assessment of contingencies, including penalties and accruing interest	$ 315
Assessment for 2002 [Member]
Loss Contingencies [Line Items]
Assessment of contingencies, including penalties and accruing interest, reduced	28
Assessment of contingencies, prior to reductions	66
IPI Tax on Cosmetics [Member]
Loss Contingencies [Line Items]
Estimated Litigation Liability	82
Judicial Deposit	64
Derivative actions [Member]
Loss Contingencies [Line Items]
Estimated Litigation Liability	4
Brockton [Member]
Loss Contingencies [Line Items]
Litigation Settlement, Amount		$ 62
Insurance Settlements Receivable, Current		60
Payments for legal settlements		$ 2
ERISA [Member]
Loss Contingencies [Line Items]
Litigation Settlement, Amount	6
Estimated Litigation Liability	1
Insurance Settlements Receivable, Current	$ 5
DOJ [Member] | FCPA [Member]
Loss Contingencies [Line Items]
Litigation Settlement, Amount			$ 68
SEC [Member] | FCPA [Member]
Loss Contingencies [Line Items]
Litigation Settlement, Amount			$ 67

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) Tables (Details) - USD ($) $ in Millions		3 Months Ended			6 Months Ended
		Jun. 30, 2016	Mar. 31, 2016	Jun. 30, 2015	Jun. 30, 2016		Jun. 30, 2015
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at Period Start		$ (1,006.6)	$ (1,366.2)	$ (1,333.6)	$ (1,366.2)		$ (1,217.6)
Other comprehensive (loss) income other than reclassifications		(9.3)		21.4	1.9		(108.3)
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax		0.5		0.5	0.9	[1]	0.9
Amortization of net actuarial loss and prior service cost, net of tax	[2]				12.3
Total reclassifications into earnings					354.5
Balance at Period End		(1,009.8)	(1,006.6)	(1,298.4)	(1,009.8)		(1,298.4)
Change in derivative losses on cash flow hedges, tax		0.0		0.0	0.0		0.0
Amortization of net actuarial loss and prior service cost, tax		0.2		0.3	0.4		0.6
Foreign Currency Gain (Loss) [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at Period Start		(854.8)	(950.0)	(803.1)	(950.0)		(677.0)
Other comprehensive (loss) income other than reclassifications		(7.9)		21.4	16.0		(104.7)
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax	[1]				0.0
Amortization of net actuarial loss and prior service cost, net of tax					0.0
Total reclassifications into earnings					71.3
Balance at Period End		(862.7)	(854.8)	(781.7)	(862.7)		(781.7)
Cash Flow Hedge [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at Period Start		(0.9)	(1.3)	(2.8)	(1.3)		(3.2)
Other comprehensive (loss) income other than reclassifications		0.0		0.0	0.0		0.0
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax	[1]				0.9
Amortization of net actuarial loss and prior service cost, net of tax					0.0
Total reclassifications into earnings					0.9
Balance at Period End		(0.4)	(0.9)	(2.3)	(0.4)		(2.3)
Net Investment Hedging [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at Period Start		(4.3)	(4.3)	(4.3)	(4.3)		(4.3)
Other comprehensive (loss) income other than reclassifications		0.0		0.0	0.0		0.0
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax					0.0
Amortization of net actuarial loss and prior service cost, net of tax					0.0
Total reclassifications into earnings					0.0
Balance at Period End		(4.3)	(4.3)	(4.3)	(4.3)		(4.3)
Accumulated Defined Benefit Plans Adjustment [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at Period Start		(146.6)	(410.6)	(523.4)	(410.6)		(533.1)
Other comprehensive (loss) income other than reclassifications		(1.4)		0.0	(14.1)		(3.6)
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax					0.0
Amortization of net actuarial loss and prior service cost, net of tax	[2]				12.3
Total reclassifications into earnings					282.3
Balance at Period End		(142.4)	$ (146.6)	(510.1)	(142.4)		(510.1)
Reclassification out of Accumulated Other Comprehensive Income [Member]
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax	[1]	0.5		0.5			0.9
Amortization of net actuarial loss and prior service cost, net of tax	[2]	5.6		13.3			26.6
Deconsolidation of Venezuela, net of tax of $0.0					82.1
Separation of North America, net of tax of $10.2					259.2
Total reclassifications into earnings		6.1		13.8			27.5
Reclassification out of Accumulated Other Comprehensive Income [Member] | Foreign Currency Gain (Loss) [Member]
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax	[1]	0.0		0.0			0.0
Amortization of net actuarial loss and prior service cost, net of tax	[2]	0.0		0.0			0.0
Deconsolidation of Venezuela, net of tax of $0.0					81.3
Separation of North America, net of tax of $10.2					(10.0)
Total reclassifications into earnings		0.0		0.0			0.0
Reclassification out of Accumulated Other Comprehensive Income [Member] | Cash Flow Hedge [Member]
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax	[1]	0.5		0.5			0.9
Amortization of net actuarial loss and prior service cost, net of tax	[2]	0.0		0.0			0.0
Deconsolidation of Venezuela, net of tax of $0.0					0.0
Separation of North America, net of tax of $10.2					0.0
Total reclassifications into earnings		0.5		0.5			0.9
Reclassification out of Accumulated Other Comprehensive Income [Member] | Net Investment Hedging [Member]
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax		0.0		0.0			0.0
Amortization of net actuarial loss and prior service cost, net of tax	[2]	0.0		0.0			0.0
Deconsolidation of Venezuela, net of tax of $0.0					0.0
Separation of North America, net of tax of $10.2					0.0
Total reclassifications into earnings		0.0		0.0			0.0
Reclassification out of Accumulated Other Comprehensive Income [Member] | Accumulated Defined Benefit Plans Adjustment [Member]
Reclassifications into earnings:
Derivative losses on cash flow hedges, net of tax		0.0		0.0			0.0
Amortization of net actuarial loss and prior service cost, net of tax	[2]	5.6		13.3			26.6
Deconsolidation of Venezuela, net of tax of $0.0					0.8
Separation of North America, net of tax of $10.2					269.2
Total reclassifications into earnings		$ 5.6		$ 13.3			$ 26.6
Separation of North America, tax					$ 10.2

[1] Gross amount reclassified to interest expense, and related taxes reclassified to income taxes.

[2] Gross amount reclassified to pension and postretirement expense, within selling, general & administrative expenses, and related taxes reclassified to income taxes.

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) Narrative (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Foreign Exchange Gains (Losses) From Translation Of Actuarial Losses Prior Service Credit And Transition Obligation	$ (9.7)	$ 10.4	$ (10.9)	$ (8.3)

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SEGMENT INFORMATION (Total Revenue and Operating Profit by Reporting Segment) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Segment Reporting Information [Line Items]
Revenue	$ 1,434.3	$ 1,564.9	$ 2,740.8	$ 3,117.0
Operating Profit	95.1	89.7	102.9	56.8
Operating Segments [Member]
Segment Reporting Information [Line Items]
Revenue	1,422.9	1,531.6	2,711.1	3,048.1
Operating Profit	191.3	190.5	326.3	372.9
Other Operating Segments and Business Activities [Member]
Segment Reporting Information [Line Items]
Revenue	11.4	33.3	29.7	68.9
Operating Profit	0.7	4.9	4.9	10.0
Corporate, Non-Segment [Member]
Segment Reporting Information [Line Items]
Unallocated global expenses	(87.5)	(96.6)	(172.1)	(183.4)
CTI restructuring initiatives	(9.4)	(2.9)	(56.2)	(30.1)
Venezuelan special items	0.0	(6.2)	0.0	(112.6)
Europe Middle East & Africa [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Revenue	520.9	530.1	1,041.3	1,062.3
Operating Profit	83.4	73.2	152.1	137.1
South Latin America [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Revenue	535.7	607.5	962.1	1,198.4
Operating Profit	61.0	69.2	84.1	136.9
North Latin America [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Revenue	224.4	236.0	429.1	465.3
Operating Profit	32.1	31.6	60.6	60.2
Asia Pacific [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Revenue	141.9	158.0	278.6	322.1
Operating Profit	$ 14.8	$ 16.5	$ 29.5	$ 38.7

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SUPPLEMENTAL BALANCE SHEET INFORMATION (Components of Prepaid Expenses and Other) (Details) - USD ($) $ in Millions	Jun. 30, 2016	Dec. 31, 2015
Prepaid Expense and Other Assets, Current [Abstract]
Prepaid taxes and tax refunds receivable	$ 101.9	$ 96.3
Receivables other than trade	79.0	69.6
Prepaid brochure costs, paper and other literature	75.1	64.5
Other	58.0	65.7
Prepaid expenses and other	$ 314.0	$ 296.1

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SUPPLEMENTAL BALANCE SHEET INFORMATION (Components of Other Assets) (Details) - USD ($) $ in Millions	Jun. 30, 2016	Dec. 31, 2015
Other Assets, Noncurrent [Abstract]
Long-term receivables	$ 214.5	$ 162.1
Deferred tax assets	190.0	172.8
Capitalized software	83.9	82.4
Investment in New Avon	38.0	0.0
Investments	37.2	36.3
Tooling (plates and molds associated with our beauty products)	13.9	15.3
Other	27.0	21.1
Other assets	$ 604.5	$ 490.0

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RESTRUCTURING INITIATIVES (Narrative) (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended		6 Months Ended		12 Months Ended
	Jan. 31, 2016	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2016
Transformation Plan [Member]
Restructuring Cost and Reserve [Line Items]
Expected annualized savings before taxes	$ 350.0
Number of years to realized cost savings	3 years
Recorded total costs to implement restructuring initiatives		$ 79.9		$ 79.9
Restructuring charges and other costs		10.0		57.5
Estimated charges to be incurred on approved initiatives		10.3		10.3
Accelerated depreciation		1.2		1.2
Expected total restructuring charges and other costs		86.2		86.2
Transformation Plan [Member] | Employee-Related Costs [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs		2.8		49.9
Estimated charges to be incurred on approved initiatives		6.3		6.3
Expected total restructuring charges and other costs		77.6		77.6
Transformation Plan [Member] | Contract Terminations/ Other [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs		4.6		4.6
Estimated charges to be incurred on approved initiatives		2.0		2.0
Expected total restructuring charges and other costs		6.6		6.6
Transformation Plan [Member] | Professional Service Fees [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs		1.1		1.5
Transformation Plan [Member] | Inventory Write Offs [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs		0.3		0.3
Transformation Plan [Member] | Forecast [Member]
Restructuring Cost and Reserve [Line Items]
Expected annualized savings before taxes						$ 25.0
Transformation Plan [Member] | Minimum [Member]
Restructuring Cost and Reserve [Line Items]
Estimated charges to be incurred on approved initiatives		15.0		15.0
Effect on future earnings for restructuring initiatives approved to-date				90.0
Expected total restructuring charges and other costs		95.0		95.0
Transformation Plan [Member] | Maximum [Member]
Restructuring Cost and Reserve [Line Items]
Estimated charges to be incurred on approved initiatives		25.0		25.0
Effect on future earnings for restructuring initiatives approved to-date				100.0
Expected total restructuring charges and other costs		105.0		105.0
Transformation Plan [Member] | Supply Chain [Member]
Restructuring Cost and Reserve [Line Items]
Expected annualized savings before taxes	$ 200.0
Transformation Plan [Member] | Other Costs [Member]
Restructuring Cost and Reserve [Line Items]
Expected annualized savings before taxes	$ 150.0
Other Restructuring Initiatives 2015 [Member]
Restructuring Cost and Reserve [Line Items]
Expected annualized savings before taxes				30.0
Restructuring charges and other costs				(0.7)
Other Restructuring Initiatives 2015 [Member] | Employee-Related Costs [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs		(0.2)	$ (0.3)	(0.7)	$ 24.7
Other Restructuring Initiatives 2015 [Member] | Professional Service Fees [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs			3.5		$ 5.4
Other Restructuring Initiatives [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs		(0.4)	$ (0.3)	(0.6)
Selling, General and Administrative Expenses [Member] | Transformation Plan [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs		9.7		57.2
Cost of Sales [Member] | Transformation Plan [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs		$ 0.3		$ 0.3

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RESTRUCTURING INITIATIVES RESTRUCTURING INITIATIVES (Liability Balances) (Details) $ in Millions	6 Months Ended
	Jun. 30, 2016 USD ($)
Transformation Plan [Member]
Restructuring Reserve [Roll Forward]
Balance at December 31, 2015	$ 21.4
2016 charges	62.4
Adjustments	(7.9)
Cash payments	(17.1)
Foreign exchange	0.2
Balance at June 30, 2016	59.0
Employee-Related Costs [Member] | Transformation Plan [Member]
Restructuring Reserve [Roll Forward]
Balance at December 31, 2015	21.4
2016 charges	57.8
Adjustments	(7.9)
Cash payments	(17.1)
Foreign exchange	0.2
Balance at June 30, 2016	54.4
Employee-Related Costs [Member] | Other Restructuring Initiatives 2015 [Member]
Restructuring Reserve [Roll Forward]
Balance at December 31, 2015	4.0
2016 charges	0.0
Adjustments	(0.7)
Cash payments	(1.5)
Foreign exchange	0.0
Balance at June 30, 2016	1.8
Contract Terminations/ Other [Member] | Transformation Plan [Member]
Restructuring Reserve [Roll Forward]
Balance at December 31, 2015	0.0
2016 charges	4.6
Adjustments	0.0
Cash payments	0.0
Foreign exchange	0.0
Balance at June 30, 2016	$ 4.6

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RESTRUCTURING INITIATIVES Restructuring Initiatives by Charge Type (Details) - Transformation Plan [Member] $ in Millions	Jun. 30, 2016 USD ($)
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs incurred to-date	$ 75.9
Estimated charges to be incurred on approved initiatives	10.3
Expected total restructuring charges and other costs	86.2
Employee-Related Costs [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs incurred to-date	71.3
Estimated charges to be incurred on approved initiatives	6.3
Expected total restructuring charges and other costs	77.6
Contract Terminations/ Other [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs incurred to-date	4.6
Estimated charges to be incurred on approved initiatives	2.0
Expected total restructuring charges and other costs	6.6
Accumulated Foreign Currency Adjustment Write-offs [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs incurred to-date	0.0
Estimated charges to be incurred on approved initiatives	2.0
Expected total restructuring charges and other costs	$ 2.0

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RESTRUCTURING INITIATIVES RESTRUCTURING INITIATIVES (Charges Reportable by Business Segment) (Details) - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2015
Transformation Plan [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs	$ 7.4	$ 47.1	$ 21.4
Restructuring charges and other costs incurred to-date	75.9
Estimated charges to be incurred on approved initiatives	10.3
Expected total restructuring charges and other costs	86.2
Transformation Plan [Member] | South Latin America [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs	1.0	12.1	0.0
Restructuring charges and other costs incurred to-date	13.1
Estimated charges to be incurred on approved initiatives	0.1
Expected total restructuring charges and other costs	13.2
Transformation Plan [Member] | North Latin America [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs	(0.4)	3.3	0.0
Restructuring charges and other costs incurred to-date	2.9
Estimated charges to be incurred on approved initiatives	0.0
Expected total restructuring charges and other costs	2.9
Transformation Plan [Member] | Europe Middle East & Africa [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs	(0.1)	21.9	0.0
Restructuring charges and other costs incurred to-date	21.8
Estimated charges to be incurred on approved initiatives	1.7
Expected total restructuring charges and other costs	23.5
Transformation Plan [Member] | Asia Pacific [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs	2.9	4.7	0.0
Restructuring charges and other costs incurred to-date	7.6
Estimated charges to be incurred on approved initiatives	2.3
Expected total restructuring charges and other costs	9.9
Transformation Plan [Member] | Corporate [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs	4.0	5.1	21.4
Restructuring charges and other costs incurred to-date	30.5
Estimated charges to be incurred on approved initiatives	6.2
Expected total restructuring charges and other costs	36.7
Other Restructuring Initiatives 2015 [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs	(0.2)	(0.5)	22.1
Restructuring charges and other costs incurred to-date	21.4
Other Restructuring Initiatives 2015 [Member] | South Latin America [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs	0.0	0.0	2.7
Restructuring charges and other costs incurred to-date	2.7
Other Restructuring Initiatives 2015 [Member] | North Latin America [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs	0.0	0.0	0.2
Restructuring charges and other costs incurred to-date	0.2
Other Restructuring Initiatives 2015 [Member] | Europe Middle East & Africa [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs	0.0	0.0	4.2
Restructuring charges and other costs incurred to-date	4.2
Other Restructuring Initiatives 2015 [Member] | Asia Pacific [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs	0.0	(0.1)	5.8
Restructuring charges and other costs incurred to-date	5.7
Other Restructuring Initiatives 2015 [Member] | Corporate [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges and other costs	(0.2)	$ (0.4)	$ 9.2
Restructuring charges and other costs incurred to-date	$ 8.6

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GOODWILL (Schedule of Goodwill) (Details) $ in Millions	6 Months Ended
	Jun. 30, 2016 USD ($)
Goodwill [Line Items]
Gross balance at Period Start	$ 181.6
Accumulated impairments	(89.3)
Net balance at Period Start	92.3
Foreign exchange	3.8
Gross balance at Period End	185.4
Accumulated impairments	(89.3)
Net balance at Period End	96.1
Europe Middle East & Africa [Member]
Goodwill [Line Items]
Gross balance at Period Start	27.7
Accumulated impairments	(6.9)
Net balance at Period Start	20.8
Foreign exchange	(0.1)
Gross balance at Period End	27.6
Accumulated impairments	(6.9)
Net balance at Period End	20.7
South Latin America [Member]
Goodwill [Line Items]
Gross balance at Period Start	68.9
Accumulated impairments	0.0
Net balance at Period Start	68.9
Foreign exchange	3.9
Gross balance at Period End	72.8
Accumulated impairments	0.0
Net balance at Period End	72.8
Asia Pacific [Member]
Goodwill [Line Items]
Gross balance at Period Start	85.0
Accumulated impairments	(82.4)
Net balance at Period Start	2.6
Foreign exchange	0.0
Gross balance at Period End	85.0
Accumulated impairments	(82.4)
Net balance at Period End	$ 2.6

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FAIR VALUE (Fair Value Assets and Liabilities Measured at Fair Value on a Recurring Basis) (Details) - USD ($) $ in Millions	Jun. 30, 2016	Dec. 31, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	$ 2.8	$ 0.0
Total Assets	2.9	1.2
Total Liabilities	4.9	1.1
Foreign Exchange Forward Contracts [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Foreign exchange forward contracts	0.1	1.2
Foreign exchange forward contracts	4.9	1.1
Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	2.8	0.0
Total Assets	2.8	0.0
Total Liabilities	0.0	0.0
Level 1 [Member] | Foreign Exchange Forward Contracts [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Foreign exchange forward contracts	0.0	0.0
Foreign exchange forward contracts	0.0	0.0
Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0.0	0.0
Total Assets	0.1	1.2
Total Liabilities	4.9	1.1
Level 2 [Member] | Foreign Exchange Forward Contracts [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Foreign exchange forward contracts	0.1	1.2
Foreign exchange forward contracts	$ 4.9	$ 1.1

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FAIR VALUE (Fair Value of Financial Instruments) (Details) - USD ($) $ in Millions		Jun. 30, 2016	Dec. 31, 2015
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Available-for-sale securities		$ 2.8	$ 0.0
Carrying Amount [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Available-for-sale securities		2.8	2.8
Debt maturing within one year	[1]	(48.8)	(55.2)
Long-term debt	[1]	(2,139.6)	(2,150.5)
Foreign exchange forward contracts		(4.8)	0.1
Fair Value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Available-for-sale securities		2.8	2.8
Debt maturing within one year	[1]	(48.8)	(55.2)
Long-term debt	[1]	(1,755.5)	(1,622.7)
Foreign exchange forward contracts		$ (4.8)	$ 0.1

[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.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Narrative) (Details) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016 USD ($)	Jun. 30, 2015 USD ($)	Jun. 30, 2016 USD ($)	Jun. 30, 2015 USD ($)	Dec. 31, 2015	Jan. 31, 2013 USD ($) derivative_instrument	Mar. 31, 2012 USD ($) derivative_instrument
Derivative [Line Items]
Total exposure to floating rate interest rates	2.00%		2.00%		2.00%
Number of interest-rate swap agreements terminated | derivative_instrument						8	2
Foreign Exchange Contract [Member]
Derivative [Line Items]
Notional amounts of foreign currency exchange contracts	$ 83.2		$ 83.2
Gain (Loss) on Foreign Currency Derivative Instruments Not Designated as Hedging Instruments	(5.2)	$ (0.9)	(7.5)	$ (8.9)
Intercompany Loans [Member]
Derivative [Line Items]
Gain (loss) due to the effect of foreign currency exchange rates on intercompany loans	4.6	(0.6)	5.4	8.1
January 2013 Interest-Rate Swap Termination [Member]
Derivative [Line Items]
Notional Amount Related to Discontinuation of Interest Rate Fair Value Hedge						$ 1,000.0
Deferred Gain (Loss) on Discontinuation of Interest Rate Fair Value Hedge	28.0		28.0			$ 90.4
Amortization of Interest Rate Swap Gains	3.7	3.6	7.4	7.3
March 2012 Interest-Rate Swap Termination [Member]
Derivative [Line Items]
Notional Amount Related to Discontinuation of Interest Rate Fair Value Hedge							$ 350.0
Deferred Gain (Loss) on Discontinuation of Interest Rate Fair Value Hedge	19.4		19.4				$ 46.1
Amortization of Interest Rate Swap Gains	$ 1.7	$ 1.7	$ 3.4	$ 3.3

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Fair Value of Derivative Instruments Outstanding) (Details) - USD ($) $ in Millions	Jun. 30, 2016	Dec. 31, 2015
Derivatives, Fair Value [Line Items]
Derivatives not designated as hedges, asset	$ 0.1	$ 1.2
Derivatives not designated as hedges, liability	4.9	1.1
Total derivatives, asset	0.1	1.2
Total derivatives, liability	4.9	1.1
Foreign Exchange Forward Contracts [Member] | Prepaid expenses and other [Member]
Derivatives, Fair Value [Line Items]
Derivatives not designated as hedges, asset	0.1	1.2
Foreign Exchange Forward Contracts [Member] | Accounts payable [Member]
Derivatives, Fair Value [Line Items]
Derivatives not designated as hedges, liability	$ 4.9	$ 1.1

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Debt (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2016	Mar. 31, 2013	Jun. 30, 2009	Mar. 31, 2008	Jun. 30, 2003
Debt Instrument [Line Items]
Amount outstanding under revolving credit facility		$ 0.0
Standby letters of credit, recorded liability		38.0
Revolving credit facility draw down amount without violating covenant		$ 335.0
Credit ratings		Our long-term credit ratings are Ba3 (Negative Outlook) for corporate family debt, and B1 (Negative Outlook) for senior unsecured debt, with Moody's; B (Stable Outlook) with S&P; and B+ (Negative Outlook) with Fitch, which are below investment grade.
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Line of credit facility		$ 400.0
Debt Instrument, Interest Rate Terms	Borrowings under the 2015 facility bear interest, at our option, at a rate per annum equal to LIBOR plus 250 basis points or a floating base rate plus 150 basis points, in each case subject to adjustment based upon a leverage-based pricing grid.
2013 Notes [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate Terms		The indenture governing the 2013 Notes contains interest rate adjustment provisions depending on the long-term credit ratings assigned to the 2013 Notes with S&P and Moody's. As described in the indenture, the interest rates on the 2013 Notes increase by .25% for each one-notch downgrade below investment grade on each of our long-term credit ratings assigned to the 2013 Notes by S&P or Moody's. These adjustments are limited to a total increase of 2% above the respective interest rates in effect on the date of issuance of the 2013 Notes.
Six Point Five Percent Notes Due March Two Thousand Nineteen [Member]
Debt Instrument [Line Items]
Debt Instrument, Face Amount				$ 350.0
Debt Instrument, Interest Rate, Stated Percentage				6.50%
Five Point Seven Five Percent Notes, Due March Two Thousand Eighteen [Member]
Debt Instrument [Line Items]
Debt Instrument, Face Amount					$ 250.0
Debt Instrument, Interest Rate, Stated Percentage					5.75%
Four Point Two Percent Notes, Due July Two Thousand Eighteen [Member]
Debt Instrument [Line Items]
Debt Instrument, Face Amount						$ 250.0
Debt Instrument, Interest Rate, Stated Percentage						4.20%
2013 Notes [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Increase (Decrease)		2.00%
Four Point Six Zero Percent Notes, Due March Two Thousand Twenty [Member]
Debt Instrument [Line Items]
Debt Instrument, Face Amount			$ 500.0
Debt Instrument, Interest Rate, Stated Percentage			4.60%
Five Point Zero Percent Notes, Due March Two Thousand Twenty-Three [Member]
Debt Instrument [Line Items]
Debt Instrument, Face Amount			$ 500.0
Debt Instrument, Interest Rate, Stated Percentage			5.00%
Six Point Nine Five Percent Notes, Due March Two Thousand Forty-Three [Member]
Debt Instrument [Line Items]
Debt Instrument, Face Amount			$ 250.0
Debt Instrument, Interest Rate, Stated Percentage			6.95%