Yesterday, Brazilian beauty giant Natura & Co released its financial report for the second quarter and first half of 2024. The report shows that Natura & Co’s consolidated net revenue for the second quarter was 7.352 billion Brazilian reais ($1.35 billion), an increase of 5.7% at constant currency (CC) compared to the second quarter of 2023, and an increase of 5.4% in Brazilian reais (BRL). The net loss of 859 million reais ($157.4 million), compared to a net loss of 732 million reais ($134.13 million) in the same period of 2023. This was mainly due to a one-time non-cash write-off of 725 million reais ($132.85 million), which impacted the company’s taxes for the quarter.
For the first half of 2024, Natura & Co’s consolidated net revenue was 13.46 billion reais ($2.47 billion), representing a 0.1% increase at constant currency (CC) compared to the first half of 2023.
The group stated that this growth was primarily driven by Natura & Co’s operations in Latin America, where revenue increased by 10.0% year-on-year (with a 4.3% increase outside of Argentina). However, this growth was offset by an 8.4% decline in Avon International’s revenue in Latin America. This improvement was mainly due to the performance of the two brands in Brazil.
Natura & Co’s brand, Natura & Co Latam, encompasses all brands in Latin America, including Natura, Avon, and The Body Shop’s distribution business in the region. In the second quarter, this business generated revenue of 5.922 billion Brazilian reais ($1.09 billion), a year-on-year increase of 10.0% (4.3% excluding Argentina), and an 8.4% increase in Brazilian reais.
The group stated that in Brazil, both Natura and Avon contributed to this growth trend. Natura achieved another quarter of strong growth (up 14.8% year-on-year), while Avon showed significant recovery compared to previous quarters (from -11.3% in the first quarter of 2024 to -0.8% in the second quarter of 2024). In the Spanish-speaking markets, Natura’s growth accelerated (with a mid-single-digit year-on-year increase excluding Argentina), but this was partially offset by adjustments in the home and fashion products category and Avon’s performance across the region.
Natura Brazil reported a 14.8% year-on-year increase in revenue for the second quarter of 2024, maintaining strong momentum driven by successful Valentine’s Day and Mother’s Day campaigns, increased cross-selling, and accelerated product innovation. Retail sales grew robustly, mainly due to accelerated same-store sales growth and continued store expansion. The brand’s own stores increased to 123 (up by 27 compared to the second quarter of fiscal year 2023), while franchise stores increased to 798 (up by 110 compared to the second quarter of fiscal year 2023).
Additionally, digital sales in Natura & Co Latam’s business (including online and social sales) declined during the quarter. Natura’s sales accounted for 5% of total sales, down by 1 percentage point (p.p.), but the robust performance in retail channels, driven by omnichannel investments, increased store numbers, and strategic infrastructure, mitigated the decline. The Avon brand also saw a 1 percentage point decline, accounting for 4% of total sales.
Another business, Avon International, recorded net revenue of 1.426 billion Brazilian reais ($261.3 million) in the second quarter, a year-on-year decline of 8.4%. Excluding The Body Shop’s revenue, Avon’s sales fell by 9.5% year-on-year, with the beauty business declining by 6.0%, and the home and fashion business experiencing a more significant drop. Productivity improved year-on-year but was offset by a reduction in the number of representatives and continued weakening in promotional activities since the fourth quarter of fiscal year 2023.
Fábio Barbosa, CEO of Natura &Co Group, declared: “Natura &Co’s revenue was back in positive territory, driven by strong results in Q2-24 at Natura &Co Latam, partially offset by still challenging figures at Avon International, while margin continued to expand. This is an important sign that our strategy is effective.
