The Brazilian cosmetics giant posted double-digit profitability growth in the fourth quarter of 2019 for its three brands - Natura, The Body Shop and Aesop - with a 12.2% increase in adjusted EBITDA.
Natura &Co’s consolidated net revenue reached R$4.7 billion in Q4, up 7.3% on a reported basis and up 6.1% at constant currency.
The fourth-quarter performance caps an important year for Natura &Co as it announced the acquisition of Avon Products, Inc. in May 2019, creating the world’s fourth-largest pure play beauty group and a leader in the Direct-to-Consumer space, with a portfolio of iconic brands. That transaction officially closed on January 3, 2020.
In the full-year, consolidated net revenue grew 7.8% on a reported basis and 7.0% at constant currency to 14.4 billion Reais. Adjusted EBITDA was up 7.5% to 2.0 billion Reais and UOI increased 5.7%.
"2019 was another year of profitable growth and transformation for Natura &Co, as we continued to make significant progress in building a multi-brand, multi-channel, purpose-driven group. Our results continue to demonstrate our ability to serve an ever-increasing number of customers across price points and distribution channels,” said Roberto Marques, Executive Chairman of Natura &Co.
In 2019, the Natura brand also continued evolving its Relationship Selling model toward a multichannel strategy.
The Natura brand’s adjusted net revenue in Brazil was up 3.0% in Q4. Natura’s digital platform now has over 900,000 users in Brazil and online sales grew in double-digits. Latam also saw growth of 10.6% in net revenue in Brazilian Reais and a stronger 28.9% in constant currency. In the full year, sales were up 4.0% in Brazil and 13.5% in Latam (+23.9% in constant currency).
The Body Shop continues to make headway in its transformation plan. Net revenue was up 6.7% in Q4 with sales up by 5.4% in the UK, underscoring the brand’s attractiveness in its biggest market. Full-year sales rose 6.3%.
Eventually, Aesop delivered an exceptional performance. Revenue increased 25.78% in Reais and 13.4% at constant currency in Q4. Like-for-like retail sales growth was 7% in the quarter, and Aesop opened seven new signature stores in the period, bringing the total to 247. In the full year, sales rose 22.5% in Reais and 12.3% at constant currency.