SÃO PAULO, Aug. 13, 2020
/PRNewswire/ -- Natura &Co's rapid pivot to online and digital
platforms led to 225% growth in e-commerce sales, allowing the
Group to outperform the global Cosmetics, Fragrance and Toiletries
market in the second quarter. Consolidated sales stood at
R$7.0 billion, down only 12.7%
despite the unprecedented global impacts of the COVID-19
pandemic.
The quarter also saw the launch of the Group's Commitment to
Life, a comprehensive sustainability plan through 2030, further
increasing Natura &Co's actions to tackle some of the world's
most pressing issues, including the climate crisis and protecting
the Amazon, the defense of human rights, ensuring equality and
inclusion and embracing circularity and regeneration.
And Natura &Co also successfully completed a R$2 billion capital raise in the quarter that
will allow the Group to invest R$400
million in the coming six months in digital and IT, with
further significant investments planned over the next four
years.
Roberto Marques, Executive
Chairman and Group CEO of Natura &Co, declared: "Our continued
efforts to accelerate the digital transformation of our businesses
enabled us to largely offset store closures, ensure business
continuity, and deliver market outperformance during a period in
which much of the world faced continued lockdown measures. Every
brand and business in the Group became truly omnichannel during the
second quarter and—given the circumstances—helped deliver a robust
and competitive overall performance, both in terms of sales and
EBITDA.
"To further develop our omnichannel model, we will continue
making significant investments in digital and IT thanks to our
successful capital raise, and I'm also delighted to announce two
strategic partnerships, one with Vayner Media, a global powerhouse
in social media, which will include digital support for the Avon
brand relaunch, and another with Singu, a leading Brazilian digital
platform for at-home beauty services.
"We also took a major step in advancing our purpose-driven
vision to business this quarter by launching our 2030
sustainability plan. Today more than ever, Natura &Co's
trailblazing approach combining economic, social and environmental
performance is an absolute imperative."
Natura &Co's consolidated net revenue of R$7.0 billion was driven by remarkable growth by
the Natura brand in Brazil and
strong growth in sales in Reais by The Body Shop and Aesop, with
exceptional performances in digital social selling and e-commerce.
Excluding the phasing effect on sales of a previously-disclosed
cyber incident at Avon, of
approximately R$450 million already
captured in Q3, net revenue in Q2 would have been -7.0% vs Q2 19
(-18.6% at constant currency). Adjusted EBITDA was R$615.2 million, with margin of 8.8%, reflecting
the Group's cost discipline to offset lower sales.
Group e-commerce sales grew by about 225% in the quarter vs. the
same period last year, with growth of 150% at Natura and
Avon combined, 230% at the Body
Shop and 430% at Aesop. Digital social selling also made major
advances. At end-Q2-20, there were 889,000 Natura consultant online
stores, 65% more than in Q2-19, and orders through these stores
nearly tripled. The implementation of new features, such as the
interactive e-brochure, has allowed us to significantly grow sales
through our digital platforms. The digitalization of Avon
International representatives continued, and sales via the
digital brochure in the quarter were more than triple those in
Q2-19, while e-commerce sales more than doubled.
Natura &Co Latam's net revenue was down 16.5% in BRL. The
Natura brand's net revenue increased by 4.4%, supported by a
remarkable performance at Natura Brazil (+7.9%), driven by the
strength of its digital relationship selling model, as well as
successful and innovative Mother's Day and Valentine's Day
campaigns. This helped offset a 3.6% drop in Hispanic Latam due to
COVID-19 restrictions. The Avon
brand's net revenue declined 35.2% in BRL on a reduction in
representatives across all markets in Latin America and COVID-19 impacts, as well as
the cyber incident. Brazil dropped
31.1% while Hispanic Latam was down 37.8%. Q2-20 Adjusted
EBITDA for Natura &Co Latam was R$373.2
million, and adjusted EBITDA margin was 9.4% (-320 bps). In
H1, Natura &Co Latam's net revenue was down 7.8% in BRL and
adjusted EBITDA was R$660.9 million,
with adjusted EBITDA margin of 8.1% (-160 bps).
Avon International, which comprises Avon's activities in 50 markets throughout
Europe, Asia, Africa
and the Middle East, saw its Q2
net revenue decrease by 21.6% in BRL. The decrease was caused by a
combination of lower representative activity related to COVID-19
impact and the cyber incident. Representatives increased
adoption of digital assets and sales via the digital brochure more
than doubled in the quarter vs Q1. Adjusted EBITDA was
R$72.6 million, with 4.4% margin. In
H1, net sales were down 11.9% and adjusted EBITDA margin was 4.7%
(-840 bps).
The Body Shop's net revenue increased 15.5% in BRL, driven by a
very strong performance in online and direct sales. COVID-19
lockdown measures impacted retail performance in the quarter, with
87% of retail stores closed at the end of April, before reopening
mostly in June, ending the quarter with 16% still closed. Revenue
progressively improved as stores reopened and returned to growth of
+14% in June. Consumers continued to shift to e-commerce and
At-Home (direct sales), with growth of more than 230% and 280%,
respectively, significantly offsetting lost retail sales. Adjusted
EBITDA in Q2 was R$132.8 million,
with adjusted margin of 14.8% (-90 bps). H1-20 net revenue
increased 9.0% in BRL while adjusted EBITDA was R$278.6 million, with adjusted margin of 14.9%
(-280 bps).
The Aesop success story continued in Q2, with strong
double-digit growth in both sales and profitability in Reais. Net
sales grew 34.8% in Q2 as a 430% increase in digital sales helped
offset the closure of 90% of the store network through much of Q2.
Growth resumed in June and was a strong +20%. EBITDA in Q2 grew by
78.5% to R$102.6 million, with margin
up 650 basis points to 26.8%. In H1, net sales were up 30.8% and
EBITDA rose 52.8% to R$180.6 million,
with margin of 25.0% (+360 bps).
About Natura &Co
Natura &Co is a global,
purpose-driven, multi-channel and multi-brand cosmetics group which
includes Avon, Natura, The Body
Shop and Aesop. Natura &Co posted net revenues of R$ 14.4 billion in 2019 and R$32.9 billion on a proforma basis, including
Avon. The four companies that form
the group are committed to generating positive economic, social and
environmental impact. For 130 years Avon has stood for women: providing
innovative, quality beauty products which are primarily sold to
women, through women. Founded in 1969, Natura is a Brazilian
multinational in the cosmetics and personal care segment, leader in
direct sales. Founded in 1976 in Brighton, England, by Anita Roddick, The Body Shop is a global beauty
brand that seeks to make a positive difference in the world. The
Australian beauty brand Aesop was established in 1987 with a quest
to create a range of superlative products for skin, hair and the
body.
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SOURCE Natura &Co