Meeting with Shareholders 2017

Transcription

1 Meeting with Shareholders 2017

2 Marcel Goya Investor Relations

3 1. Financial Statements for the year ended December 31 st, 2016; 2. Capex Budget for 2017, allocation of net income for the year ended December 31 st, 2016, as well as the distribution of dividends and payment of interest on equity; 3. New composition of the Board of Directors, with term of office until the Annual Shareholders Meeting of 2018; 4. Overall compensation of the Company s Management to be paid until the Annual Shareholders Meeting of 2018; 1. Assignment and transfer of 102,956 registered shares of common stock, without par value, issued by the Company and granted to Mr. Roberto Oliveira de Lima, according to the Program of Restricted Shares. 3

4 126,000 NCs 88,000 NCs 94,000 NCs 74,000 NCs 1.3 million NCs 161,000 NCs 4

5 Products The Natura brand has 870 products organized into 10 categories and 29 sub-brands Aesop has 110 products, with highlights to face and body care categories 5

6 Our employees Natura has 7,600 employees: 4,600 in Brazil; 3,000 in International Operations (Latam + Aesop) In Natura we have: 63% women in the workforce 34% leadership positions (directors and above) held by women in Brazil and 18% in Latam 53% of management positions held by women in Brazil and 61% in Latam 4% of our workforce comprised of people with special needs 6

7 Our spaces We have 5 manufacturing plants, being 4 in Cajamar (SP) and 1 in Benevides (PA), as well as third-party manufacturing in Brazil, Argentina, Mexico, Colombia and Australia Espaço Natura Cajamar Inaugurated in ,000 m2 of total area 84,000 m2 of built area Ecoparque Inaugurated in ,725,000 m2 of total area 24,000 m2 of built area 7

8 Our spaces Distribution Centers / HUBs 9 in Brazil 5 in Latam In Brazil, 49,000 orders are picked and delivered daily to the country s over 5,900 cities, with 42% delivered within 48 hours 99.6% of the orders are placed online All DCs in Brazil are qualified for Rede Natura (or online business) deliveries 8

9 Corporate Governance One of the first companies to list on the Novo Mercado segment First publicly traded B-Corporation Integrated Annual Report Board of Directors created in 1998, currently with 9 members, 6 of whom are independent Supporting committees: Corporate Governance Audit, Risk Management & Finance Strategic People & Organizational Development 9

10 Ownership structure 40% 7% 4% AMERICA NORTH AMERICA DO NORTE EUROPA EUROPE 10% 49% BRASIL BRAZIL 60% Ações Free-floated em circulação Shares Controladores Controlling shareholders 30% ASIA OUTROS OTHERS 6% 3% % em free circulação float 91% Number No. de of Investidores: Investors: Individuals Institutional Brazil Institutional Foreign 10 Base date 31/03/

11 Our stocks performance 1200 NATU3 vs. IBOVESPA since IPO NATU3 +513% IBOV +239% NATU3 05/26/2004 R$ 4.95 NATU3 07/31/2009 R$ NATU3 04/10/2017 R$

12 José Roberto Lettiere - CFO 2016 Results

13 Consolidated Net Revenue (R$ Mn) Annual Data Change: 0.2% YTD Data Change: -1.6% Brazilian Real 4th. Quarter Change Currency Aesop 12.2% 28.5% Latam Brazil -8.7% -0.5% 26.4% 4Q15 4Q16 Gross Revenue Brazil +1.6% Brazil Latam Aesop 13

14 Consolidated Ebitda (R$ Mn) Annual Data Change: -10.2% YTD Data Change: 2.0% 4th. Quarter Change Brazilian Real Currency 18,9% 17,0% Aesop 0.7% 15.7% Latam 10.8% 33.9% ,4% 20,1% Brazil 3.8% Q15 4T15 4T16 4Q16 Brazil Latam Aesop Consolidated EBITDA Margin (%NR) 14

15 Consolidated Capex (R$ Mn) Lower Capex than in prior years, with focus on supporting growth in Latam, Aesop and expanding into new channels in Brazil. 25% 13% 62% Brazil Latam Aesop Budget 15

16 Free Cash Generation (R$ Mn) Annual Data 1,13 1, YTD Data Strong free cash generation in 4Q16 due to: More efficient financial management; Better working capital management; Capex optimization Q15 4T15 4T16 4Q16 Indebtedness 16

17 Sustainability Crer para Ver product line Global funding of R$38.2Mn in 2016 (+27%) More than 500,000 students involved Recognition in 2016 Época Empresas Verdes Ekos Ucuuba Exame Sustainability Guide Corporate Sustainability Index (ISE) 20 most sustainable companies corporations in the world (Corporate Knights) We are advancing towards our 2020 goals: Indicador Relative carbon emissions % post consumption recycles materials Cumulative business volume in the Pan-Amazon region 3.17 Kg CO2/ Kg prod billed 2.15 Kg CO2/ Kg prod billed 4.3 % 10.0 % R$ Mn R$ 1 Bn 17

18 João Paulo Ferreira - CEO Challenges, strategy and priorities

19 Challenges Consolidated Net Revenue (R$) Consolidated EBITDA margin (%) Dividends and net interest on equity (R$) * Market Cap (R$) * Net of withheld income tax at source 19

20 Strategic map BRAZIL LATAM INTERNATIONAL REVITALIZATION OF DIRECT SELLING MULTI- CHANNEL SHOPPING EXPERIENCE REPOSITIONING OF THE NATURA BRAND CATEGORY & BRAND ARCHITECTURE STRENGTHENING OF CFT POSITIONING IN LATAM EXPANSION INTO NEW MARKETS SUSTAINABILITY (Positive Impact) STRATEGY FACILITATORS INNOVATION OPERATIONS & LOGISTICS SERVICES DIGITAL TRANSFORMATION PEOPLE & CULTURE EFFICIENCY & PRODUCTIVITY 20 20

21 2017 Priorities Brazil Revitalization of Direct Selling Fragrances, Body Care and Gifts To accelerate the digitalization New Channels To Maintain momentum in Latam Culture & Organization Program 21

22 Revitalization of Direct Selling

23 Goals DO PROJETO Improve the value proposition of consultants activity Improve qualification of new recruits Improve consumer buying experience Increase consultants productivity and share of mind, heart and wallet 23

24 Value Proposition 24

25 Channel segmentation Natura Beauty Consultants Natura Beauty Specialists Natura Beauty Entrepreneurs 25

26 Natura Beauty Consultants Large or midsized consultants that dedicate a significant amount of time to Direct Selling Reclaim the value of Natura Consulting Increase average earnings Opportunity for progression and career growth Quality recruiting and initial training Strengthening of the relationship with Natura 26

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28 Natura Beauty Specialists Professionals connected to the universe of beauty, with higher education and profile for selling "core beauty" Consulting as a career: self-fulfillment and pleasure Focus on face care and makeup Unique experience: assistance and experimentation Higher productivity Exclusive opportunities : Training in partnership with Anhembi Morumbi University Independent career development Demonstration kit and inventory on hand Specific recruitment Digital tool for business management 28

29 Digital magnification of relationship and Certified Training Daily activities supported by Consulting App with integrated CRM: Client portfolio management Customized communication Synchronized calendar Check-out system with payment means After sales functionalities Service level review by end consumer (under development) Partnership with Anhembi Morumbi University 36-hour training course on make up, face care, fashion, style, business. 29

30 Natura Beauty Entrepreneurs Micro-entrepreneurs with physical points of sales Target consumer: B2C income classes Visual standardization of interior and exterior Stores geolocated in high foot traffic areas Convenience sales with product sampling, stock on hand and payment means Aqui tem Natura ( Natura Inside ) retail operations with brand experience 30

31 Natura Beauty Entrepreneurs Before After 31

32 Digitalization

33 Rede Natura One of Brazil's largest beauty e- commerce Diamond Ebit Certification and most loved cosmetics and fragrance online store 1.6mn consumers registered 100K Digital Natura Consultants 50% of channel is incremental: Purely digital Natura Digital Consultant 2x revenue growth in 2016 vs

34 Natura is a digital business: High Tech & High Touch CONSULTING APP NATURA APP (end consumer) Order capture, including voice Individualized Promotions Daily Relationship with Natura Payment Digital Magazine 10.2% average productivity gain 270k active consultants 2% average sales growth with activation via push notifications Online Shopping, Content and Services Locate consultants & stores Augmented reality +150k subscription 25% retention (market average: 18%) Differentiated use of information and digital intelligence 34

35 Brazil Retail

36 Natura Stores AB1 income class consumers 7 stores in São Paulo Scale up in 2017 Makeup and face care Premium portfolio mix: Ekos, Chronos & Una Natura Shopping Anália Franco, SP 36

37 Drugstores Sou line in 3,118 stores, with expansion to other chains in 2017 Faces line in drugstores in the first semester of

38 Latam

39 Natura Latam Natura Market Share 2,4% 2,9% 12-16: +2.2pp 3,4% 3,9% 4,6% Natura Market Share in Direct Selling 45% Natura Consultants per 1K inhabitants 6,1 17% 2,1 Latam Sources: Euromonitor and FMI WEO Out2016 (2016 data) Brasil Brazil Latam Brasil Brazil 39

40 Natura Latam Brand Preference Strong construction of brand value attributes and performance, combining technology and nature % 1 st 35%* 1 st 28% 1 st 11%* 5 th 5%* 6 th 0,1 0,05 0-0,05-0,1 Profitability EBITDA Latam 12,5% 11,1% 9,1% 9,1% 5,4% 5,6% ,1% Q15 4Q16 EBITDA (R$ Mn) EBITDA Margin Natura is ready to sustain the pace of growth - Operations and logistics services (34% of local sourcing) - Local team and strong reputation - Multi-channel and direct selling revitalization Source: Brand Essence (IPSOS) 2016 * Countries with 2015 data 40

41 Total Market Share Latam 14,0 12,0 10,0 8,0 6,0 4,0 2,0 12,0% 9,0% 8,6% 7,7% 5,8% 4,6% 3,2% 2,7% 2,2% Natura 2021 Ambition #1 DS #4 CFT Unilever P&G L'Oréal Colgate Avon Natura Belcorp Competitors Beiersdorf J&J Source: Euromonitor - Beauty and Personal Care Market Sizes - Historic Retail Value RSP Current Prices Fx Exchange Rates 41

42 Aesop

43 Aesop High quality products, which communicate honestly, openly and sincerely with consumers Combination of ingredients of proven botanical and scientific origins Design and creativity that challenge and excite Exclusive retail concepts that connect to communities Exceptional consumer service High growth same store sales growth 43 Aesop Vila Madalena, São Paulo

44 Aesop Vila Madalena, São Paulo

45 Aesop Net Revenue (R$ Mn) EBITDA (R$ Mn) 4X X Q15 4T15 4Q16 4T Q15 4T15 4Q16 4T16 Signature Stores department stores Aesop Stores by region Europa Europe Ásia Asia Countries: * América North America do Norte Oceania América Latin America Latina * Oceania: Australia, New Zealand Asia: Hong Kong, Malaysia, Singapore, Taiwan, Macau, Japan, Korea Europe: France, Germany, Switzerland, Italy, Norway, Sweden, Denmark, United Kingdom North America: USA, Canada South America: Brazil 45

46 Sustainability

47 Sustainability 2050 Vision Positive Impact Brands influencing Values and Behaviors Social and Human Development of our Relationship Network Tripple Bottom Line performance management and Vanguard Business Practices Eco-efficient Productive Chains from socio-biodiversity and the Standing Forest Economy 2020 Ambition with Public Goals 47

48 Organization & Culture There is an ongoing journey of cultural and organizational evolution Talented and engaged people Distributed leadership Autonomy and interdependence (one team) Agile governance, clear goals and responsibilities Passion for cosmetics and relationships Results Performance Organizational Health External orientation consumers, consultants, competitors Focus on results Triple Bottom Line 48

49 Key takeaways Brazil recovery Direct Selling transformation Multi-channel experience focused on end consumer Fast-growing international business Cost control and focus on cash generation Alignment of Organization and Culture with business needs Brand strengthening and portfolio adequacy 49

50 Fragrances

51 Fragrances Largest CFT category in Brazil and Latin America. Brazil is the 2 nd largest market in the world and Latin America is the 3 rd *. Natura is world's 10 th largest player and is leader in fragrances for men in Brazil, second in fragrances for women in Brazil and 3 rd player in Latin America. 52 million units sold in Source: Euromonitor/ Kantar 51 * Considering the five countries where Natura operates

52 Fragrances Vision To be one of the world s five largest players in the category, creating a new global reference, through an authentic and proprietary perfumery, with quality and a Brazilian soul, that engage individuals to live and reveal the beauty of their nature, establishing empathic relationships with themselves, with others and with the world. 52

53 Natura Fragrances Our differentials Sustainable Innovations Art of Perfumery Our Brands

54 Natura Fragrances Our differentials Sustainable Innovations Art of Perfumery Our Brands

55 Sustainable Innovations 100% organic alcohol 20% recycled glass 100% recycled PET for refills 55

56 Natura Fragrances Our differentials Sustainable Innovations Art of Perfumery Our Brands

57 Olfactory Center Exclusive Perfumer Co-creation 57

58 Natura Olfactory Palette 58

59 Natura Fragrances Our differentials Sustainable Innovations Art of Perfumery Our Brands

60 Portfolio Male Prestige 60

61 Portfolio Evolution Male Masstige 61

62 Portfolio Evolution Female Prestige 62

63 Portfolio Evolution Female Masstige 63

64 Portfolio Evolution Female Mass 64

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66 Gifts

67 Market grows through the gifts channel. Gifts are a relevant part of the categories revenue: - Female Fragrances 33% - Male Fragrances 20% - Body care 25% - Makeup 16% Commemorative dates concentrate 45% of revenue. Birthdays account for 55%. MERCADO PRESENTES 67

68 Natura makes gifts for all kinds of stories. Intimate, professional, familiar. Of who have been together for a long time. Or of who are meeting each other now for the first time. It can be a fragrance, a lipstick, a colorful eye shadow. A body cream, a flower-scented soap, a body oil that illuminates the skin or a moisturizer. To celebrate, thank, apologize or declare love. Our gifts help to keep alive the story that exists among people. To keep alive the particular beauty of each meeting. That is why we believe that a gift is much more than a product. A gift also includes you and I. And the entire time of our story. Natura. Every gift tells a story. MERCADO PRESENTES 68

69 Natura seeks to rescue the meaning of the act of gifting, inviting people to be present at the moment of gifting, putting into words everything they feel and is not often said. Natura Mother s Day gifts. Everything from you to your Mother. MERCADO PRESENTES 69

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72 APIMEC 72

73 NATURA COSMÉTICOS S.A. 73

74 Thank you 74