Natura & Co, a leading company in the beauty and personal care industry, has released its financial report for the fourth quarterof 2023 and full year results.
In terms of revenue, the consolidated net revenue reached BRL 6.6 billion ($1.33 billion), representing a 4.5% increase compared to the same period last year in constant currency (CC). However, there was a year-on-year decline of 17.4% in BRL. The revenue growth was mainly driven by the strong performance of the Natura brand in Brazil, with a solid 8.6% year-on-year increase. Avon International, on the other hand, experienced a decline in revenues, primarily due to adjustments in its portfolio.
Natura &Co demonstrated profitability with an adjusted EBITDA of BRL 671 million ($134.76 million), achieving a 10.1% margin. This represents a 370 basis points year-on-year expansion, indicating the company’s focus on improving its operational efficiency. The margin improvement was driven by both Natura &Co Latam and Avon International, with significant gross margin improvements and savings in selling and general administrative expenses.
However, the company reported a net loss of BRL 2.7 billion ($542.2 million) in the fourth quarter, mainly due to factors such as discontinued operations, including the sale of The Body Shop, and Avon’s impairment. Despite this, the company’s net income for the fiscal year was BRL 3 billion ($602.5 million), reflecting a consistent improvement in profitability.
Fábio Barbosa, the Group CEO of Natura &Co, expressed his satisfaction with the company’s achievements in 2023. He highlighted the progress made in the corporate strategy, operational and financial aspects, and balance sheet strengthening. Natura &Co focused on profitability and cash conversion, which resulted in an expansion of the adjusted EBITDA margin and positive free cash flow.
Barbosa also mentioned ongoing projects in Latin America and Avon International, with a focus on simplification and integration. The company aims to optimize its capital structure and announced dividend payments of BRL 979 million ($196.6 million) for the year.
In terms of brand revenue, in the fourth quarter, Natura & Co Latam recorded net income of BRL 4.8822 billion, down 17.9% year-on-year, while Avon International’s net income declined by BRL 1.7141 billion ($344.2 million), down 16.9% year-on-year, a decline partly attributable to further adjustments in the Home & Fashion portfolio. Avon International’s Beauty division also posted a small decline of 2.6% on a constant currency basis, while The Body Shop’s net income declined 14.3% to BRL 1.2896 billion ($259 million).
