Natura &Co wrote off a loss in 2020 to report a net profit in 2021 of 1 billion reais. This gain occurred in part due to the organization’s focus on cost discipline in the face of cost pressures. EBITDA margin posted a gain of 90 basis points in the fourth quarter of 2021, despite a slight decline in sales during the quarter.
Net revenue for the fourth quarter of 2021 was R$11.6 billion, down 3% compared to the same period last year. The adjusted EBITDA margin was 13.3%, a result which reflects structural changes and cost synergies achieved at Avon International.
Driven by growth in the company’s Hispanic markets, consolidated net sales in 2021 reached R$40.1 billion. Online sales, e-commerce, social selling and digital app sales accounted for 52% of total revenue.
The Body Shop and Aesop recorded positive increases in net sales of 8.8% and 22.8% respectively. Avon International reported a 5.6% decline in net revenue in the fourth quarter of 2021, but an increase of 2.5% for the full year 2021.
While Ukraine and Russia are important markets for the group, these regions represent less than 5% of the organization’s total turnover. Natura &Co announced that it has suspended operations in Russia for The Body Shop and Aesop, and is suspending exports for Avon while continuing to support social selling operations for its representatives. In addition to the global complexities of inflation, supply chain limitations and pandemic restrictions, this international crisis has made the group’s focus on cost and ongoing transformational change even more important. This cost focus has allowed the company to significantly increase its EBITDA margin.
The group ended the year with a strong balance sheet, with R$6 billion in cash or cash equivalents.