Q1 Earnings

May 2, 2019

Jan Zijderveld

Gustavo Arnal

CEO

CFO

Miguel Fernandez

Global President

2

Non-GAAP Reconciliation

This material will reference certain non-GAAP financial

measures, which we believe to be useful to investors, although they

should not be considered superior to the measures presented in

accordance with GAAP.

A reconciliation of these non-GAAP financial measures

to their comparable GAAP measures is included in the appendix and

in our earnings release, located on the Investor Relations section of

our website.

Note: This material will reference constant-dollar revenue

rates. Foreign currency impact is determined as the difference

between actual growth rates and constant-dollar growth rates. Actual

growth rates including foreign currency impact, are included in our

earnings release, located on the Investor Relations section of our

website.

Forward-Looking Statements

This material contains “forward-looking statements” that are made

pursuant to the safe harbor provisions of the Private Securities Litigation

Reform Act of 1995, including statements relating to revenue trends, cost

savings, annualized tax rate, impacts of foreign exchange, efforts to

implement new digital strategies, improved representative engagement

training, recruitment and service, product launches and advertising

spend. Because forward-looking statements inherently involve risks and

uncertainties, actual future results may differ materially from those

expressed or implied by such forward-looking statements. These risks

and uncertainties include, but are not limited to, the possibility of

business disruption, competitive uncertainties, and general economic and

business conditions in Avon’s markets as well as the other risks detailed

in Avon’s Form 10-K for the year ended December 31, 2018 and Avon’s

other filings with the Securities and Exchange Commission. Avon

undertakes no obligation to update any statements in this material after it

is posted to the Investor Relations section of our website.

Non-GAAP Reconciliation

and Forward-Looking Statements

3

May 2, 2019

Introduction

Q1 Financial Results

Market & Representative Update

Q&A

Today’s Agenda

Open Up Avon Strategy Update

4

Open Up Avon – Our Strategy is Clear

Open Up AvonStabilize in 2019

Stabilize revenue, slight margin improvement

5

Format: The pages in this presentation provide comparisons for Constant $

(C$) revenue and Adjusted non-GAAP information for the quarter.

Q1 Earnings

Gustavo Arnal

Q1 Financial Results

CFO

6

Q1

1. C$ Revenue from Reportable Segments

2. FCF = Cash from Operations plus Cash from investing activities

Key Financial Metrics

C$ Revenue

C$ Revenue increases

in APAC, NOLA, and

SOLA offset by decline

in EMEA

-2.9%Constant

Dollar

Adj. Operating

Margin (AOM)

AOM improved behind

pricing and cost savings,

despite FX

4.5%+50bps

Cash

On track for positive and

higher FCF generation for

FY’19

Solid Liquidity

-$117MFree Cash Flow

+6m vs 1Q’18

7

1

2

Q1

-2.9%Constant

Dollar

Improving Revenue Management

with more Productive Representatives

C$ Revenue – Productivity continues to improve

C$ Revenue1 C$ Revenue1 Growth Drivers

SOLA

+0.5%

-8.9%Active

Reps

-10.9% Units

ProductivityVolume

1. C$ Revenue from Reportable Segments;

GAAP Reported F$ (Reported currency) Revenue was –14%

8

APAC

+6.6%NOLA

+1.2%

EMEA

-9.0%

+ 6.0%Average

Rep Sales

+ 8.0%Price / Mix

1

Q1

-10.0%

-8.0%

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

Q1 18 Q2 18 Q3 18 Q4 18 Q1 19

Segment C$ Revenue Trends

Philippines,

China

Growth

Significant

challenges

in Russia

Mexico

stable-

growing

Brazil

stemming

declines

Note: 2018 Revenue Trends are using Pre-Revenue Recognition Standards for comparability to 20179

APAC NOLAEMEA SOLA

Q1

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

0

0.2

0.4

0.6

0.8

1

1.2

Q1'15 Q1'16 Q1'17 Q1'18 Q1'19

Adjusted Q1 Operating Margin Improving

1. 2015-2018 Adjusted Operating Profit (AOP) Trends are using Pre-Revenue Recognition Standards,

2. 2019/2018 AOP Trends are using Post Revenue Recognition Standards

10

1 2

Q1

1. FX primarily impacting Gross Margin

Note - Reported figures: Q1 2019 F$ GAAP operating margin = (0.3)% a decrease of (350) bps; see appendix for reconciliation

Adjusted Operating Margin Pricing and cost savings offset FX pressure

F$ +50bps

Favorable

price and

mix

>$20M cost

savings largely

on lower

headcount

FX pressure

largely from

Brazil,

Argentina, and

Turkey

11

150bps

110bps-210bps

10%

Reduction in

total SG&A

1

Q1

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Brazil Real

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Argentina Peso

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Turkey Lira

Expected H2 FX Pressure Easing Q1 FX Impact Continues

FX Impact of (210)bps on Operating ProfitFX headwinds expected to ease in H2 2019

• Continued pressure from significant currency devaluation in

top markets

• (11%) Q1 impact on Revenue vs PY

• Brazilian Real pressure is easing and beginning to stabilize

• Based on current rates, expecting FX impact to smooth out

during H2 2019

as of April 20192018 F$ 2019 F$

12

~20% ~100%~50%

2019 F$ = actual rates through April and current April spot for rest of year

Q1 Free Cash Flow strong focusRemain focused on self funding cash investment needs

Expect positive cash flow generation above prior year

1. 2018 YE Third party vendor transition backlog clearing in Q1 19, partially offset by improving inventory

2. Profit, non-cash, tax, interest and other

4

13

Note: Numbers in chart may not tie out due to rounding

3

1 2

Cash from Operations (CfO) -$46M

3. Other mainly lower CAPEX spent

4. Proceeds from sale of China Manufacturing

1.

Optimizing

Working

Capital

2.

Improving

Margin

3.

Monetizing

non-core

assets

Q1

Note – Reported figures: Income tax provision = $19.5M; Diluted EPS = ($0.09)

Q1 2018 Q1 2019 Variance

Q1 – Adj. Income Tax Provision $24.4M $23.2M $1.2M

Q1 – Adjusted Diluted EPS ($0.02) $0.03 $0.05

March 31st – Gross Debt $1.9B $1.62B ($280M)

Other Key Metrics showing progress

Continue to deliver on adjusted tax rate

reductions in 2019

83%76%

64%50%-55%

2016 2017 2018 2019 E

14

Liquidity ~$620M

Q1 Earnings

Market and

Representative Update

Miguel Fernandez

Global President

15

Q1

Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Comments

Brazil

(12.4%) (11.2%) (12.5%)* (4.6%) (2.4%)

Better incentives, lower bad debt, less returns,

and portfolio simplification. Steady improvement in all areas

is helping to stem declining trends.

Mexico(6.3%) 0.1% 7.2% 2.3% 2.1%

Continued focus on training improving ARS. Implementing

accelerated approach to attract sales leaders and reignite

quality appointments.

Russia

(3.7%) (0.5%) (8.7%) (1.4%) (19.2%)

Overall Russian beauty market declined significantly.

Weaker Sales Leaders engagement caused lower Rep

numbers and activity. New leader and interventions

underway with a heavy focus on recruitment efforts across

all Sales Leaders segments.

Philippines(2.7%) 0.4% 3.7% 5.3% 12.0%

Higher ARS due to effective pricing. Regaining momentum

through Avon opportunity events outside the branches to

increase recruiting.

Argentina

19.1% 24.5% 18.7% 23.2% 44.8%

Adjusted commercial model for macroeconomic reality.

Aggressive pricing given local macroeconomic situation.

Active Reps up on training/segmented programs, E-Rep

pilot launched in March.

C$ Revenue TrendsThree top markets growing while Brazil improves

*Adjusted to exclude 1X benefit from IPI tax reversal

2018/2017 Revenue Trends are using Pre-Revenue Recognition Standards, for comparability16

1

1. Excluding IPI tax favorability Q1 19 was (6.4%) and Q4 18 was (8%)

1

ARS – Average Rep Sales

Q1

Reboot social selling Improve value of brand Re-engage consumers

Russia in Full Reset

Modern and relevantBrand Pull

17

-20

-10

0

Q1 18 Q2 18 Q3 18 Q4 18 Q1 19Russia sales

SWAT team on the ground to Reset Russia

Continues to be a challenging market

• Smarter Beauty Choice Brochures

• Driving more on-trend portfolio

- K- beauty & Fragrance

• Digital marketing

• Pop Up Stores in malls

• New narrative to reach younger Reps

• Deploy direct delivery

• Trendier innovation

Improving Productivity

• Field re-ignition strategy; Sales Leader

segmentation and engagement

• Refocus on training to boost Her earnings

(micro-influencer training)

• New Digital Training Platform and training

centers

Q1

Reboot social selling Improve value of brand Simplify & ‘Open Up’

Brazil regaining momentum Improving trends toward the end of 2019

Invest in HER

Obsession to serve Net Revenue Management

Dedicated E-commerce Business Unit

Working CapitalRejuvenate Brand

Inventory days -20

Q1 2019Aug 2018

Reduce 30% of Product Portfolio

Product Mix helping to improve sales

18

-18%

• During TV slots:

• Searches +16%

• Avon Brand Recall +5%

New Credit & Collection Process

Q1 18 Q2 18 Q3 18 Q4 18 Q1 19

0

50

100

2018 2019

Perfect order

-40

10

60

110

2018 2019

Call center calls

-15

-5

Q1 18 Q2 18 Q3 18 Q4 18 Q1 19

Brazil sales

Q1 18 Q1 19

Net Promoter Score

+13%

Q1 18 Q1 19

Q1 18 Q1 19

Bad debt -43%

Q1 18 Q1 19

Price Mix +11%

Q1

Q1 18 Q1 19

Increasing productivity of Representatives

Representatives are earning

more money

19

Average Rep Sales are improving in most

top markets

Global Average Rep Sales

+6%

8%

-1%

14%

22%

33%

1%

8%

Brazil

Russia

Mexico

Philippines

Argentina

South Africa

UK

Average Rep Sales

Q1 Training driving more productivityTrained leaders earn 15% more money

Segmented TrainingTraining with Intent

Digital Training

20

+20% Retention

+23% ARS

Scaling Digital Training

Product TrainingBeauty Advising

ANEW

Training

Fragrance

Training

ARS – Average Rep Sales

Q1

New Representative tools

Better Digital toolsTools to improve productivity and ease of doing business

New Online Ordering PlatformNew sales leader app

21

Recruitment tools:

Self appointment;

Sales leader

mobile

appointment

Launched

in Poland

Makes it easy for consumers to buy

Helps sales leaders make

recruitment and retention easy

86%

positive

feedback

Rep app for

orders and

content sharing

20% of Appointmentswere mobile in

Romanian Pilot

Q1 Earnings

Jan Zijderveld

Business Update

CEO

22

Open Up Avon

23

Number of Consumers

Avera

ge P

rice Reboot core

• Re-energize Representatives

• Improve Brochures

• Service & delivery options

• Performance culture

• Talent & capabilities

4. More Simple & Fit For Purpose

$ 6

$ 3

100M 200M

1. More Value

2. More Access

3. More Productive

Beauty Entrepreneurs

Open Up Avon

24

Number of Consumers

Ave

rag

e

Pri

ce

Reboot core• Re-energize Representatives

• Improve Brochures

• Service & delivery options

• Performance culture

• Talent & capabilities

Segment & Training DigitalEarnings

PromosPricing Mix/TierInnovation

New GenerationAsia E-commerce

1. More Value

2. More Access

3. More Productive

Beauty Entrepreneurs

Head count Inventory days Monetize non-core

Avera

ge P

rice

4. More Simple & Fit For Purpose

100M 200M

$ 6

$ 3

25

Mix and tiering

On-trend Innovation

+8%

Q1 ‘19Q1 ‘18

Price Mix

Optimizing promotions

Pricing power

1. Improving Value Drivers

1a. Improving Value Drivers – Product Levers

26

Mix and tieringOn-trend scaled Innovation

2018 2019

ScalingInnovation

+4X

Q1 18 Q1 19

Price Mix

+8%

-1%

27

Optimizing promotionsPricing power

From free gifts

To

£3.50

From

£1.99

UK

Skin So

Soft Sales

+35%

UK

ARS +7%

Nude

Bundle ARS

+9%

To bundles

1b. Improving Value Drivers – Pricing Levers

China Sales Growth E-Commerce Sales Growth New Generation of Consultants

Multiple Channel Approach

• Upgrade Franchise stores

• Build retail footprint with distributors

• Drive e-commerce with T-mall

• Dedicated E-Commerce Units

• My Avon store - 25 markets

• IMB - 6M brochure views every month

• Training Reps to become Micro-

influencers

45 % of new recruits are Millennials

• Trendier innovation

• More digital presence

• Faster delivery options

28

Avon anywhere & anytime

Q1 18 Q1 19

+74%

Online Sales

IMB – Instant Message Brochure

+29%Q1 C$ Sales

Trend

2. Driving More Access

• China Manufacturing

Facility

• Rye Office

• Malaysia Office

• New Avon / LGH&H

Much Leaner

Head Count

Reduction

Inventory

Days

Monetize

Non-Core Assets

29

Q1

Reduction

6%

$13MQ1

Reduction

20 dayCash

proceeds

in 2019

~$100M

15

17

19

21

23

25

2017 2018 Q1 19

-8%-6%

Much Simpler

Q1 18 Q1 19

-20 days

-14%

4. Leaner and Simpler

50%of women

do not feel they live

in a culture that

encourages female

entrepreneurs

30

Female Beauty Entrepreneur

Accelerator ProgramWomen’s Health Stand4her

Championing a whole new

generation of female startups while

opening up our innovation pipeline to

support our fast-beauty strategy

Global launch with 2.5B reach

Clear Purpose of Avon - Empowering Women

2019Monetize

non-core

assets

$100M

Head Count

Reduction

10%

SKU

Reduction

25%

Tax Rate

Reduction

10%-15%

2019 Year of Execution

31

Stemming

Revenue Decline

• Reboot Direct Selling

• Drive productivity

• Scale innovation &

modernize brand

Expanding

MarginDriving

Cash Flow

• Working Capital

improvements

• Divesting non-core

assets

• Improving cash tax

• Improving price mix

• Reducing cost

• Leaner & Simpler

Average

Rep Sales

>5%

Double

E-Commerce

2018

32

Looking Ahead

Q1 Earnings

Question & Answer

33

Thank You34

Appendix35

Q1

Reported

GAAP

Adjusted

(Non-GAAP)

Reportable Segments C$ revenue growth (2.9%) (2.9%)

Reportable Segments F$ revenue growth (13.9%) (13.9%)

Total Avon Gross Margin 56.4% 56.8%

Total Avon SG&A % of revenue 56.8% 52.4%

Total Avon Operating Margin (0.3%) 4.5%

Total Avon Diluted EPS ($0.09) $0.03

Effective Tax Rate (433.3%) 54.2%

Reported and Adjusted Results

Note: Numbers in table may not tie out due to rounding

36

Q1 Non-GAAP Reconciliation

37

Three Months Ended March 31, 2019

Q1 Non-GAAP Reconciliation

38

Three Months Ended March 31, 2018