Natura &Co announced its financial results for the third quarter of 2023, reporting consolidated net revenue of $1.54 billion, a 0.7% decline from the previous year’s quarter. Natura Latam, which saw a 18.6% improvement in constant currency, as well as a stable trend at Avon International, was offset by a challenging quarter for The Body Shop, which saw a 13.2% decline in constant currency.
Consolidated gross profit during the quarter reached $1.01 billion, posting a gross margin improvement year-over-year in all business units. Consolidated adjusted EBITDA was $154 million with a margin of 10%.
The company ended the quarter with net cash of $143 million.
“Avon International posted broadly stable top line and further margin improvements, reaching high-single-digit adjusted EBITDA margin,” said Fábio Barbosa, Group CEO of Natura &Co. “The proceeds from the sale of Aesop, closed in late August, enabled us to quickly advance in our liability management plan, with more than half of our debt already prepaid by the end of the quarter. This is an important step to unlock sustainable value for our investors and deliver on our financial priorities of maintaining a strong capital structure, strict financial discipline on costs and expenses, and boosting cash conversion. On the latter, we reached a neutral cash generation this quarter despite the normal seasonal cash consumption to build up inventories for the holiday season. Furthermore, marking the third year of our sustainability vision, after having made substantial progress towards our goals set in 2020, our approach has evolved. We have realigned our metrics, and targets to address the pressing concerns of our time. We have been a partner of the Union for Ethical Biotrade (UEBT) for over fifteen years and together we will work towards Natura &Co’s adoption of regenerative practices to deliver even more positive impact. Finally, we recently announced updates related to The Body Shop sale process and we will keep the market informed of any relevant news. This is another important step to continue to streamline our business, a journey started in the second half of 2022. We are confident that our enhanced capital structure, combined with a laser-focus strategy on our key priorities, will allow us to unlock significant value for our shareholders in the future through both topline growth and margin expansion.”