Natura & Co revenues rise but The Body Shop challenges remain

Natura & Co has reported a 1.9% increase in net revenue to £1.2 billion (BRL 7.8 billion) for the second quarter, despite continued challenges at The Body Shop.

Net revenue at The Body Shop decreased 12% to £126 million (BRL 800 million) during the quarter.

Combined sales of core business distribution channels (stores, e-commerce and franchise) showed a mid-single-digit decline, whilst The Body Shop at Home continued to decline sharply.

Avon International, which includes all markets except Latin America, saw net revenue drop 8.1% to £237 million (BRL 1.5 billion).

Its beauty category increased 3% year-on-year, whilst home and style reported a steep decline amid Avon's planned portfolio reduction of more than 50% of SKUs.

The group's adjusted EBITDA grew 230 bps to £119 billion (BRL 753 million). This was driven by gross margin improvements and continued cost control at The Body Shop partially offset by planned investments at Natura & Co Latam and Avon International.

Fábio Barbosa, CEO of Natura & Co, said: "Natura & Co’s Q2 performance continued to show the improvement already observed in Q1, with low-single digit top line growth at constant currency and a significant improvement in adjusted EBITDA margin.

"We look forward to delivering our strategy, continuing to position Natura &Co on the course towards strong profitability and low leverage, allowing us to pursue meaningful and sustainable growth in the future.

"Closing the sale of Aesop, further work on simplifying and turning around our international assets while delivering our ESG agenda are fundamental steps that will help us achieve our ambition."

Read TheIndustry.beauty's feature on Will The Body Shop shine now Aēsop is out of the picture?