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Natura &Co posts 36% growth of net revenues in 2018

Natura &Co - the entity gathering the Natura, Aesop and The Body Shop Brands - posted strong results with net income surging by 48.7% in Q4-2018. Consolidated sales increased by 16.1% in Q4 on a reported basis, reaching R$4.3 billion, driven by strong performance in all three businesses.

Drops of Youth Concentrate

Drops of Youth Concentrate

In full-year 2018, reported net revenues grew by 36% vs. the previous year to R$13.4 billion and adjusted net revenue (which includes The Body Shop for 12 months as if it had been part of Natura &Co for all of 2017) improved by 13.5%.

Reported net income surged 48.7% in the fourth quarter to R$381.7 million, driven by higher EBITDA and lower financial expenses. This strong result came despite hyperinflationary accounting effects in Argentina and The Body Shop’s transformation costs. Underlying operating income grew by 2.9% in the fourth quarter, to R$542.4 million, and by 17.3% in the full-year on a pro-forma basis, to nearly R$1.3 billion. Free cash flow generation more than doubled to R$708.7 million in the fourth quarter, vs. R$296.2 million in Q4-17, contributing to significant deleveraging.

"With double-digit growth in revenue, adjusted EBITDA and net income and strong free-cash flow generation, Natura &Co’s performance in Q4 caps its first full year of existence with a very strong note. All three of our iconic brands contributed to this performance, with each one rolling out its specific strategy while benefiting from the scale, resources, sharing of best practices and strategic direction of the group," commented Roberto Marques, Natura &Co’s Executive Chairman of the Board.

Natura's headquarters in Cajamar, São Paulo

Natura’s headquarters in Cajamar, São Paulo

Natura posted the strongest quarter in its history in terms of revenue, which was up 15.7% to R$2.7 billion in Q4 and up 9.9% in the full-year, boosted by strong Christmas campaigns in Brazil and Latin America. In Brazil, reported sales grew 12.9% in the fourth quarter, with continued gains in market share, outperforming the market in key categories. The ninth consecutive quarter of productivity gains by consultants also demonstrated the vigour of its Relationship Selling commercial model. In Latin America, reported revenue increased by 23.4% in the quarter and by 23.1% at constant currency. Mexico, Argentina and Colombia turned in very strong performances.

According to the company, The Body Shop’s transformation plan is well underway and showing encouraging results. Net revenue was up 11.2% in Brazilian Reais in Q4 and up 17.7% in the full year. At constant currency, sales were down 1.7% in Q4, impacted by the closure of underperforming stores, as part of the optimization of its store footprint, and the phasing of orders by franchisees, which boosted Q3 as they prepared for a successful Christmas campaign. In the full-year, sales rose 1.7% in constant currency.

Aesop delivered yet another quarter and full-year of remarkable growth, with reported revenue up by 43.9% in Q4 and an even stronger 50.6% in the full year, with very strong performance across all channels and geographies. Aesop continued opening signature stores, adding 18 in the last 12 months to reach 227 at year-end.

© 2019 - Brazil Beauty News - www.brazilbeautynews.com

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