Fiscal Year registered positive net cash of
BRL 1.7 billion
Net income
reached BRL 3.0 billion, of which
BRL 979 million will be distributed
as dividends
SÃO PAULO, March 12, 2024
/PRNewswire/ -- Natura &Co's (B3:NTCO3) 2023 financial results,
released today, reflect the benefits of a strategy defined and
implemented 18 months ago, to prioritize profitability and cash
conversion versus revenue growth, integrate the Natura and Avon
brands in Latin America, and
divest non-core assets to deleverage and simplify its corporate
structure.
Natura &Co's 2023 consolidated net revenue reached
BRL 26.7 billion in the year,
up 3.5% vs 2022 in constant currency (CC) and down 8.5%
year-on-year in Brazilian Reais (BRL). Natura brand posted strong
growth in Latin America, led by
Brazil with revenues up 8.6% YoY,
partially offset by expected reductions in Avon Latam with the
rollout of Wave 2 in the region, and in Avon International related
to decrease in consultants and the portfolio optimization strategy.
At the same time, both brands saw improvements in the expense
structure while noting the transformational savings recorded at
Avon International.
Improved profitability is principally attributed to the
expansion of gross margin that reached 63.8% in 2023, up 410 bps
vs. 2022, driven by effective pricing strategies, product mix
enhancements and portfolio optimization, coupled with reductions in
general and administrative expenses. Adjusted EBITDA reached
BRL 2,7 billion, and adjusted EBITDA
margin expanded 310 bps YoY, showing growth versus prior year in
every quarter. These results reinforced the consistent execution of
the financial and operational strategy throughout the year, even
taking into consideration the Argentinean hyperinflation accounting
impacts in the fourth quarter.
Net income totaled BRL 3.0 billion
in 2023, an improvement from a net loss of BRL 2.8 billion in 2022, boosted by the proceeds
from the USD 2.6 billion sale of
Aesop concluded in August. These proceeds contributed to the
Company's solid year-end net cash position of BRL 1.7 billion and the debt-to-EBITDA ratio of
-0.79x (vs 3.5x at the end of 2022) after paying ˜60% of its
debt.
Fabio Barbosa, Group CEO of
Natura &Co, commented: "2023 marked a pivotal chapter in
the Company's history, setting the stage for the ambitious horizons
we aim to reach in 2024. Notwithstanding a volatile macro
environment in Latin America, we
kicked-off Wave 2, our most important strategic project aiming to
combine Avon and Natura brands in the region. Progress in
Brazil, Peru and Colombia is underway, and the lessons learnt
allowed us to implement a softer integration in Chile in early 2024.
On our corporate strategy, we delivered a leaner holding
structure as the Business units operate with more autonomy. Our
simplification agenda has progressed markedly, thanks to the
divestments of Aesop and The Body Shop, which allowed us to pay our
debt and end the year with a strong net cash position. The positive
free cash flow to firm, alongside our much stronger balance sheet,
allowed us to start moving to a more optimal capital structure, and
as a result we are announcing BRL 979
million in dividend payments for this year.
Recognizing Natura &Co's social achievements, the Company is
proud to have reached its goal of providing a living wage for all
employees across Natura &Co. This commitment extends beyond the
notion of a minimum wage, embracing a comprehensive understanding
of a dignified life. Our approach reflects a deep commitment to
improving the quality of life for our employees and their families,
thereby contributing to the construction of a more equitable
society. Natura &Co also maintained its commitment to closing
its pay gap between men and women for the whole Group.
We are encouraged with the positive results from the strategy
set in 2022, but we must continue evolving that strategy. Margins
and cash remain as priorities in the short term, paving the way for
further investments in brands and technology. In 2024, capital
allocation will continue to be a critical driver for future value
creation, with a focus on investments in key growth markets and
projects. We continue to expect volatility in top-line, but with
margin improvements in the full-year, particularly ex-Argentina."
Subsequent Events
In another step towards simplifying the corporate structure,
Natura &Co announced in January
2024 the ADR NYSE delisting, and in February 2024, the Company released a material
fact announcing the study of a possible separation of Natura
&Co Latam and Avon, unlocking the full potential of both
companies. The Company will keep the market informed as these
studies evolve.
The full earning report and financial statements can be accessed
at https://ri.naturaeco.com/en/.
About Natura &Co
Natura &Co is a global purpose-driven group uniting
Natura and Avon brands. We connect more than 200
million clients worldwide, engaging them through 7 million
dedicated Consultants and Representatives, 900 stores and
franchises, and 22,000 employees.
We believe in promoting real positive economic, social,
and environmental impact. We believe that the world does not
need another big company. The world needs symbols of
change capable of blazing new trails and inspiring others to
follow. We believe in the power of cooperation, co-creation,
and collaboration for a better way of living and doing
business.
We are Natura &Co.
This communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities. Any offers,
solicitations or offers to buy, or any sales of securities will be
made in accordance with the registration requirements of the
Securities Act of 1933, as amended, or an exemption therefrom. This
communication may contain forward-looking statements which reflect
Natura &Co's current view on future events and financial and
operational development. Words such as "intend", "expect",
"anticipate", "may", "believe", "plan", "estimate" and other
expressions which imply indications or predictions of future
development or trends, and which are not based on historical facts,
are intended to identify forward-looking statements.
Forward-looking statements inherently involve both known and
unknown risks and uncertainties as they depend on future events and
circumstances. Forward-looking statements do not guarantee future
results or development and the actual outcome could differ
materially from the forward-looking statements. Any forward-looking
statements contained in this communication speak only as at the
date hereof, and Natura &Co does not assume or undertake any
obligation or responsibility to update any forward-looking
statement to reflect events or circumstances after the date hereof
or to reflect the occurrence of unanticipated events.
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