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Natura &Co reports $70M profit in Q3

Natura &Co CEO Roberto Marques speaks to Yahoo Finance about how the company is faring amid COVID-19.

Video Transcript

JULIE HYMAN: Natura & Co came out with its earnings, net revenue up 32% to just over 10 billion reals, which is about $1.4 billion in US dollars. This is the parent company, not just of Natura cosmetics and skin care, but also of The Body Shop and Avon, which, of course, are well-known brands here in the United States. We're joined now by Roberto Marques. He is Natura & Co's CEO.

Roberto, it looks like you all had a relatively strong quarter. And there's have really been a lot of questions about the future of the industry because of the pandemic. But also, when you look at a company like Avon specifically, which is sort of a person-to-person selling platform, one would think that there would be some challenges there in this present moment. So what kind of trends did you see across the brands?

ROBERTO MARQUES: Hi, Julie, and thanks for having me. Listen, yes, we're very pleased with the strong quarter, that even if we look at a constant currencies, there were double-digit growth, which is pretty remarkable in the middle of this pandemic. And I think what's really driving that is our firm belief in this notion which we've embraced enough omni-channel and really be very resilient in how to adjust to the pandemic, to the crisis.

And to your point about, you know, what used to be in the past direct selling, you know, Avon brand or even Natura brand, is like the door to door, we actually evolved pretty quickly to what we call social selling, where the consultants and reps are actually using their social platform, social media, they're creating their online stores and selling through those channels. And we're seeing an explosion of the adoption of social selling tools. Just one notion, for example, more than double the Avon globally adoption of sales through e-Brochures. The e-Brochures. Is what used to be the paper brochures that I think people still might relate it to direct selling, and now it's all done electronically.

It's all done by use of social platforms. And that is really booming, and it's something that we always believe in the future of direct selling, of becoming a relationship selling done both in the physical space and the online space. And what we are seeing, especially since the pandemic, is an increasingly adoption and higher sales coming from what we call social selling.

BRIAN SOZZI: Robert, what are you seeing in the business as more lockdowns are happening in emerging markets and also in Europe?

ROBERTO MARQUES: Yeah, Brian, so it's a good question. So of course, we continue to monitoring those lockdowns, and we keep reminding people that we are far from over from this global pandemic. But our business is very resilient. So we've seen, you know, even in-- when the peak of the pandemic in the second quarter, where we had almost 95% of our stores closed between The Body Shop and Aesop, our e-commerce business also grew exponentially at that point over 300%, 400%.

And it's interesting that even as we reopen the stores in some markets, we are still seeing the e-commerce continue to be very strong. So our belief is that even during the pandemic, you know, we've got to have the agility to serve the customers in the way that they can buy the products, either e-commerce-- even now we are seeing, for example, in England, some of the lockdowns in France, but we can still serve the customer through curbside click and collect. So really finding ways to remain safe and follow the protocols from the government, but at the same time, being able to serve our customers.

JULIE HYMAN: Roberto, I believe when we talked before, we talked about the idea that Natura is a B Corporation. It's just a certification meaning that from a legal perspective, it can consider not just shareholders' interests, but also the broader community stakeholders, employees, the community, the environment, et cetera. How is that playing out for you? Particularly, you know, you have a fairly sprawling global business right now, you're in a pandemic, so how are you kind of balancing that and managing that through this time?

ROBERTO MARQUES: Yeah, Julie, so one breaking news for you is that Aesop, which is one of the business within Natura & Co, just got a B Corp certification. So now we have Natura as a B Corp. We have The Body Shop that got the B certification last year. And now we have Aesop. And of course, now our goal is to start working with Avon to also, over the next couple of years, make Avon also a B Corp.

Listen, at the end of the day is a very important message of putting, you know, planet, and people, and profit with the same importance. And when the world is seeing, you know, a pandemic, and social unrest, and the importance of taking care of the environment, taking care of people, I think companies that have really embraced that, we call the ESGs, but most important have a strong purpose and values are the ones that are really going to prevail. Consumers and customers are demanding companies to have points of views on those issues, to make sure that companies can, you know, serve a higher purpose and be a force for good.

I think the private sector has a very important role to play into that matter. And so we are pleased that we can contribute somehow to spread that message and to make sure that other companies embrace this notion of a B Corp, where we put planet, profit, and people kind of under the same-- under the same priority from all stakeholders, and not just shareholders.

JULIE HYMAN: Well, keep us posted on the Avon certification as well. Roberto, it's good to talk to you. Roberto Marques is Natura & Co CEO. Many thanks.

ROBERTO MARQUES: Thank you, guys. Appreciate it.