After The Acquisition Of The Body Shop, The Profit Of Brazilian Cosmetics Giant Natura Grew By 117.5% In 2017, The Year Of Transition.
Recently, Natura & Co , the Brazilian cosmetics giant, published the financial data for 2017, which showed that all their brands performed well, with full-year net sales growth rate of 24.5% and net margin rate of 117.5%.
Up to 31 December, 2017, Natura’s core financial data for the year as follows:
Net sales grew to 9.85 billion Brazilian Reals at the rate of 24.5% (Including the gains generated in 4 months after the acquisition of The Body Shop);
Net profit grew to 670 million Brazilian Reals at the rate of 117.5%;
Adjusted EBIDTA grew to 1.74 billion Brazilian Reals at the rate of 29.6%;
The ratio of net debt to EBIDTA was 3. 0, lower than the predicted ratio 3.6, but before the acquisition of The Body Shop, the ratio was 1.4 in the same period last year.
Up to 31 December, 2017, Natura’s core financial data for the fourth quarter as follows:
Net sales grew to 3.73 billion Brazilian Reals at the rate of 62.7% (Including the gains generated in 4 months after the acquisition of The Body Shop);
Net profit grew to 260 million Brazilian Reals at the rate of 23%;
Adjusted EBIDTA grew to 630 million Brazilian Reals at the rate of 36%;
In terms of Brands:
Natura: Sales in fixed exchange rates grew to 7.69 billion Brazilian Reals at the rate of 7.8%, which mainly benefited from a 18% increase of sales in fixed exchange rates in Latin American market. Argentina, Colombia and Mexico were particularly strong, and the local market in Brazil was also developing steadily, with sales growth in fixed exchange rates at the rate of 4.5%.
Aesop: Sales in fixed exchange rates grew to 710 million Brazilian Reals at the rate of 30.3%, which basically benefited from the opening of 33 new exclusive stores and the sales increase by 14.8% in stores.
The Body Shop: Sales in fixed exchange rates grew to 1.46 billion Brazilian Reals at the rate 2.2%, which is promoted by the performance of on-line, franchise channels and the improvement of North American and Asian marketing.
Up to now, Aesop has 308 stores, of which 209 are independent stores and 99 are franchise stores.
Up to 31 December, 2017, The Body Shop had 1099 direct-sales stores (40 new and 75 closed), with the additional franchise stores, the total store quantity reached 3049.
Development plans in 2018:
~Improving the synergistic effect among the three brands;
~Bring the ratio of net debt to EBIDTA back to the level before the acquisition of The Body Shop in 2021;
~Raise the overall profit level.
Specific development plans for each brand:
Natura: Strengthening the Brazilian market and maintaining the positive growth in the Latin American market; continue to revitalize direct marketing channels; brand repositioning; market expansion in developed and developing countries; establishment of full-channel sales.
Aesop: Improving full-channel sales and customer service level; expanding backend support capability; increasing social and environmental related activities.
The Body Shop: Revitalizing the brand; improving retail operations and strengthening the relationship with franchisees; improving operational efficiency; enhancing the full-channel sales experience; restructuring the structure.
Natura & Co called the year 2017 as the year of the company’s transition and acquired The Body Shop, a British natural plant cosmetics brand, adjusted its management structure and changed its name to Natura & Co after the acquisition.
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