Related Party Transactions (Tables)

12 Months Ended

Dec. 31, 2019

The following tables present the related party transactions with New Avon, affiliates of Cerberus and the Instituto Avon in Brazil. There are no other related party transactions. On August 14, 2019, we sold our investment in New Avon to LG Household & Health Care Ltd. Upon completion of the sale, New Avon is no longer a related party, for the purposes of this disclosure, transactions with New Avon during the period it was a related party have been disclosed. See Note 3, Discontinued Operation and Assets and Liabilities Held for Sale, to the Consolidated Financial Statements contained herein, for further details.


	Year Ended December 31,		Year Ended December 31,
	2019		2018
Statement of Operations Data
Revenue from sale of product to New Avon⁽¹⁾	$	12.0	$	25.7
Gross profit from sale of product to New Avon⁽¹⁾	$	0.2	$	1.6

Cost of sales for purchases from New Avon⁽²⁾	$	2.1	$	2.9

SG&A expenses:
Transition services, intellectual property, research and development and subleases⁽³⁾	$	(0.5)	$	(5.9)
Project management team⁽⁴⁾	4.0		1.2
Net increase, (reduction) of SG&A expenses	$	3.5	$	(4.7)

Interest income from Instituto Avon⁽⁵⁾	$	.2	$	.1

	December 31, 2019		December 31, 2018
Balance Sheet Data
Inventories⁽⁶⁾	N/A		$	.3
Receivables due from New Avon⁽⁶⁾	N/A		$	7.0
Receivables due from Instituto Avon⁽⁵⁾	$	2.1	$	3.2
Payables due to New Avon⁽⁶⁾	N/A		$	.2
Payables due to an affiliate of Cerberus⁽⁷⁾	$	2.1	$	.6

⁽¹⁾ The Company supplies product to New Avon as part of a manufacturing and supply agreement. On August 14, 2019, the Company sold it's investment in New Avon to LG Household & Health Care Ltd.; from this point New Avon is no longer a related party. Transactions entered into with New Avon for the period it was a related party in 2019 and the twelve month period ended December 31, 2018 have been disclosed above.

⁽²⁾ New Avon supplies products to the Company as part of the same manufacturing and supply agreement discussed in footnote ⁽¹⁾ above. The Company purchased $1.6 and $2.8 from New Avon associated with this agreement during the years ended December 31, 2019 and 2018, respectively, and recorded $2.1 and $2.9 associated with these purchases within cost of sales during the years ended December 31, 2019 and 2018, respectively. On August 14, 2019, the Company sold its investment in New Avon to LG Household & Health Care Ltd; from this point New Avon is no longer a related party. Transactions entered into with New Avon for the period it was a related party in 2019 and the twelve month period ended December 31, 2018 have been disclosed above.

⁽³⁾ The Company also entered into a transition services agreement to provide certain services to New Avon, which expired on October 31, 2018, as well as an intellectual property license agreement, an agreement for technical support and innovation and subleases for office space. In addition, New Avon performed certain services for the Company under a similar transition services agreement which expired during the third quarter of 2017. The Company recorded a net $0.5 and $5.9 reduction of SG&A expenses associated with these agreements during the years ended December 31, 2019 and 2018, respectively, which generally represents a recovery of the related costs.

⁽⁴⁾ The Company also entered into agreements with an affiliate of Cerberus, which provide for the secondment of Cerberus affiliate personnel to the Company's project management team responsible for assisting with the execution of the transformation plan (the "Transformation Plan") announced in January 2016 and Open Up Avon strategy ("Open Up Avon") announced in September 2018. The Company recorded $4.0 and $1.2 in SG&A expenses associated with these agreements during the years ended December 31, 2019 and 2018, respectively. See Note 17, Restructuring Initiatives for additional information related to the Transformation Plan and Open Up Avon.

⁽⁵⁾ During the second quarter of 2018, the Company entered into an agreement to loan the Instituto Avon, an independent non-government charitable organization in Brazil, R$12 million (Brazilian real) for an unsecured 5-year term at a fixed interest rate of 7% per annum, to be paid back in five equal annual installments. The Instituto Avon was created by an Avon subsidiary in Brazil, with the board and executive team comprised of Avon Brazil management. The purpose of the loan was to provide the Instituto Avon with the means to donate funds to Fundação Pio XII (a leading cancer prevention and treatment organization in Brazil and owner of the Hospital do Câncer de Barretos), in order to invest in equipment with the objective of expanding breast cancer prevention and treatment. During the period ended December 31, 2019, Institutio Avon repaid $1 million of the loan.

⁽⁶⁾ On August 14, 2019, the Company sold its investment in New Avon to LG Household & Health Care Ltd.; from this point New Avon is no longer a related party. Therefore at December 31, 2019, we did not have any related party balances with New Avon.

⁽⁷⁾ The payables due to an affiliate of Cerberus relate to the agreement for the project management team and were classified within other accrued liabilities in our Consolidated Balance Sheets.