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1
São Paulo, Brazil, October 21, 2009 ­ Natura Cosméticos S.A. (BM&FBovespa: NATU3)
announces today its results for the third quarter of 2009 (3Q09). The financial and
operating information included in this report, except where otherwise indicated, is presented
on a consolidated basis in accordance with the Brazilian Corporation Law, Law 11,638/07.
1. INTRODUCTION
This year, as we commemorate our 40th anniversary, for 3T09 we once again present results
that show the strength of our operations and the market in which we operate. We continue to
record outstanding growth and profitability in the Brazilian market. We have grown at
significant rates in Latin America, and the operations under consolidation have posted positive
results for the fourth consecutive quarter.
Consolidated net revenues totaled R$1,054.9 million in 3Q09, increasing 15.9% over 3Q08
(R$2,922.8 million and 19.7% growth in the first nine months of 2009). In 3Q09, EBITDA
stood at R$272.1 million, representing a 14.1% year-on-year increase (R$704.1 million and
16.3% growth in 9M09.) The margin reached 25.8% in the third quarter (24.1% in 9M09.)
We have kept our commitment to maintain a minimum EBITDA margin of 23.0% 2009 and
2010.
Net income was R$190.2 million, up 19.1% over 3Q08 (R$497.3 million and 31.1% growth in
9M09.)
Core Market - Our core market, as measured by SIPATESP/ABIHPEC
1
, grew 20.3% in 1H09.
Our market share in the period rose from 21.8% in 1H08 to 22.3% in 1H09.
The table below shows Natura's share in the cosmetics and fragrances and personal hygiene
segments.
1
São Paulo Union for the Fragrance and Toiletries Industry / Brazilian Association of the Personal Hygiene, Fragrance and Cosmetics Industry.
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2
Natura Consultants and Sales Channel - The total number of available Natura Consultants
reached 988 thousand at the end of September ­ a 23% increase ­ 839 thousand of which are
in Brazil (21.3% growth) and 149 thousand in international operations (33.7% growth.) The
implementation of the new "Consultora Natura Orientadora - CNO" (Super Consultant) sales
model, the development of Latin American operations and the strength of our brand drove this
growth. It is worth pointing out that this October we reached the landmark of one million
consultants.
In keeping with the process of improving the quality of the relationship with our sales channel,
we inaugurated one more "Casa Natura" (Natura´s Show Room), this time in the city of
Guarulhos, in the São Paulo metro area, totaling 5 "Casas" in Brazil and 10 abroad. We also
opened a "Casa Natura" at our facilities in the city of Cajamar, in the São Paulo metro area,
where both visiting consultants and employees have the opportunity to learn more about our
products.
Marketing ­ Year-to-date, additional marketing investments in Brazil total R$183.0 million,
financed by R$203.9 million from productivity gains, considering the base year 2007. The
sources were: Natura magazine and efficiency gains both in raw materials purchasing and in
the receipt, sorting and transportation of the orders placed by our consultants. It is worth
noting that in 3Q09, 74% of our consultants' orders were placed on the Internet, versus 53%
in 3Q08.
Innovation - Our innovation index at the end of 9M09 stood at 66.8%, remaining stable
year-on-year (66.9% in 9M08). We had important launches in the quarter that exceeded our
expectations, such as the new Aquarela make-up line and the re-launch of Kaiak perfume.
Another launch was the Açai product line that introduces the "harvest" concept, offering
seasonal, limited-edition products available only for a limited time, with approximately six
sales cycles, whose inputs are supplied by the COFRUTA cooperative as described below.
> CF&T Core Market Net Revenues Breakdown and Natura's Market Share in Brazil
6M09
6M08
Change %
6M09
6M08
Change %
Cosmetics and Fragrances
3,354.1
2,787.2
20.3%
36.2%
35.4%
0.9
Toiletries
4,372.9
3,636.1
20.3%
11.6%
11.4%
0.2
Total
7,727.0 6,423.3
20.3%
22.3%
21.8%
0.5
Source: SIPATESP
Market Share - Natura (%)
Core Market (R$ million)
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Social and Environmental Aspects
Relationship with communities ­ With the Ekos line, in 2000 we started a new cycle
in the company's history, as a way of establishing and maintaining this relationship
network with local communities and incorporating it into Natura´s business model. We
assume this challenge to encourage environmental preservation and appreciation of folk
knowledge. Access to these raw materials is obtained through supply agreements with
extractivist communities, family farmers and rural businesspeople.
We currently work with 1,670 families organized into 21 supplier communities, located
in areas such as the Amazon and Atlantic rainforests. In addition to the purchase of raw
materials, we established benefit-sharing agreements and, in some cases, financially
support the development of these providers and their productive chains.
One recent example of this relationship is the new Açaí product line of Natura Ekos,
whose active ingredient, the Brazilian fruit açaí, is acquired from COFRUTA, a
cooperative located in the Abaetetuba community in Pará State that has been Natura's
partner since 2007 and also supplies other botanical inputs.
As a result of this launch, the community sold 2.4 times more açaí by volume
purchased from communities. Approximately 80 families have directly benefited from
this partnership. COFRUTA's açaí is grown according to sustainable management
principles and holds the organic certification seal granted by the Instituto de Mercado
Ecológico (IMO in Brazil.)
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Environmental
Water ­ In 3T09 there was an 18% reduction in the consumption of water per unit
produced
2
.
Energy ­ We improved our efficiency in the energy matrix (electricity and solar energy,
diesel oil and LP gas), reducing energy consumption per unit produced
3
by 28%.
Carbon ­ In September, the company launched the Edital Carbono Neutro 2009 (2009
Neutral Carbon Notice) for selecting 2009/2010 emissions compensation projects that it
will finance throughout this period. Voluntary projects for emissions reduction and/or
GHG (Greenhouse Gas) removal focusing on Voluntary Emissions Reductions (VER) will
be selected.
4
We also continue in our pursuit to positively influence the several links in our chain to
fight global warming. We are confident that during the United Nations Framework
Convention on Climate Change (FCCC) at the end of the year, negotiators will spare no
effort to reach a global consensus that represents a substantial advance on the Kyoto
Protocol.
Thus, driving us to actively participate in initiatives such as the Climate Neutral Network
(UNEP), Open Letter to Brazil on Climate Change, Letter of the Brazilian Business
Council for Sustainable Development (CEBDS), Caring For Climate (Global Compact);
the Copenhagen Communiqué, the Prince of Wales's Corporate Leaders Group on
Climate Change (CLGCC) and Companies for the Climate (Fundação Getúlio Vargas).
International - Our international operations continue to show high growth rates. Net
revenues grew 46.5% in domestic currency in 3Q09, representing 7.2% of consolidated net
revenue. For the fourth consecutive quarter, operations in countries under consolidation
(Argentina, Chile and Peru) have contributed with positive results, as measured by EBITDA.
Secondary Offering of Shares ­ at the end of July we conducted a new secondary offering
of shares at the price of R$26.50 per share, resulting in R$1.5 billion in proceeds and
increasing our free float from 26.25% to 39.5%. Since the secondary offering, Natura's shares
2
Data refer to Cajamar unit.
3
Data refer to Cajamar unit.
4
Unit for voluntary emissions reductions and/or GHG removal, equal to a metric ton of carbon dioxide equivalent, calculated according to global warming potentials defined
by the Kyoto Protocol).
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5
have recorded an average daily trading volume of R$29.5 million, 35% higher than the pre-
offering volume.
Finally, we would like to point out once more the strength of the market in which we operate,
which continues to show high grow rates, and the consistent results driven by our strategy of
profitable growth in Brazil and increased investment in the development of our Latin American
operations, as well as our improved management model with the implementation of regional
and business units. Above all, we highlight our investment in leadership development, in
addition to strengthening our chief competitive advantage: our organizational culture.
2. CONSOLIDATED RESULTS
3Q09
3Q08
Change %
9M09
9M08
Change %
Total Consultants - end of period*
(in thousand)
988.1
803.1
23.0
988.1
803.1
23.0
Unit sold ­ items for resale
(in million)
100.3
80.7
24.2
269.5
222.6
21.0
Gross Operating Revenues
1,450.7
1,230.9
17.9
4,003.3
3,324.9
20.4
Net Operating Revenues
1,054.9
909.9
15.9
2,922.8
2,441.6
19.7
Gross Profit
741.3
638.4
16.1
2,045.5
1,696.4
20.6
Gross Margin (%)
70.3%
70.2%
0.1 pp
70.0%
69.5%
0.5 pp
Sales Expenses
(368.7)
(325.9)
13.1
(1,042.3)
(871.5)
19.6
General and Administrative Expenses
(124.7)
(96.4)
29.3
(361.7)
(308.1)
17.4
Management compensation
(2.0)
(3.3)
(38.1)
(10.8)
(9.7)
10.8
Others Income / (Expenses), net
4.8
4.6
na
5.4
33.3
na
Financial Income / (Expenses), net
(15.6)
2.9
na
(21.4)
(10.9)
na
Operating Profit
235.1
220.2
6.7
614.7
529.4
16.1
Net Income
190.2
159.7
19.1
497.3
379.4
31.1
Net Margin (%)
18.0%
17.5%
0.5 pp
17.0%
15.5%
1.5 pp
EBITDA**
272.1
238.5
14.1
704.1
605.2
16.3
EBITDA Margin (%)
25.8%
26.2%
-0.4 pp
24.1%
24.8%
-0.7 pp
(**) EBITDA = Income from operations before financial effects + depreciation & amortization.
> Consolidated Financial Summary
(R$ million)
(*) Positon at the end of the 13th sales cycle in Brazil and the 12th sales cycle in International Operations.
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Consolidated net revenues totaled $1,054.9 million in 3Q09, a 15.9% increase compared to
3Q08. Year-to-date (9M09), consolidated net revenues stand at R$2,922.8 million, a 19.7%
increase. In addition to our market's growth due to the the country's robust internal economy,
another important driver of this positive result was our sales channel. The implementation of
the CNO model, combined with the launch of outstanding products supported by the action
plan established in the beginning of 2008, continue to be key factors in revenue growth.
In Brazil, net revenue totaled R$979.1 million in 3Q09, 14.2% more than in 3Q08. In 9M09,
net revenue in Brazil reached R$2,711.4 million, 17.8% growth compared to the same period
of 2008. The average productivity
5
of available consultants in the quarter decreased 2.7%,
from R$2,406 to R$2,341 in 3Q09 (R$6,748 productivity in 9M09, a 0.4% drop) as a result of
the channel's strong growth; new consultants are generally less productive early in their
careers.
Net revenue from our international operations totaled R$75.8 million in 3Q09, growing 43.9%
over 3Q08 (46.5% in weighted domestic currency.) In 9M09, net revenue totaled R$211.4
million in these operations, an increase of 50.8% (43.5% in weighted domestic currency),
representing 7.2% of consolidated net revenue versus 5.7% in the first nine months of 2008,
growing as expected for these operations.
Cost of Goods Sold (GOGS) decreased slightly from 29.8% in 3Q08 to 29.7% in 3Q09 with
the consequent improvement in the gross margin from 70.2% to 70.3% in the quarters,
respectively. COGS also fell from 30.5% to 30.0% between 9M08 and 9M09. The appreciation
of the real and the small average drop in the prices of certain inputs in the period were the
main factors responsible for the modest year-to-date margin gain.
The table below shows COGS broken down into its main components:
5
Productivity of Natura Consultants measured at retail prices
3Q09
3Q08
9M09
9M08
RM/PM*
23.9
23.8
24.1
24.0
Labor
2.4
2.5
2.6
2.8
Depreciation
1.0
1.2
1.1
1.3
Others
2.4
2.3
2.2
2.4
Total
29.7 29.8 30.0 30.5
(*) Raw material and packaging material
> Composition of Cost of Good Sold
(% Net Revenues)
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Selling expenses fell year-on-year from 35.8% in 3Q08 to 35.0% in 3Q09. This decrease
derives from productivity gains in Natura magazine and in logistics expenses. Comparing the
9-month periods of 2008 and 2009, these expenses have remained stable at 35.7%. It is
worth mentioning that we have experienced a positive relative growth in share of voice in both
magazine and broadcast television.
Administrative expenses in 3Q09 recorded a moderate increase in relation to net revenue,
from 10.6% in 3Q08 to 11.8%. Year-to-date (9M09), the expenses dropped slightly from
12.6% (9M08) to 12.4%. In 3Q09, the increase was mainly due to higher expenses with
projects. It is important to point out that expenses with projects in 3Q08 were below average,
since at that time we were revising the allocation of funds.
Consolidated net income reached R$190.2 million in 3Q09 versus R$159.7 million in 3Q08,
an increase of 19.1%. In 9M09, net income totaled R$497.3 million, growing 31.1% over the
same period of 2008 (R$379.4 million.)
The main drivers of this increase in 9M09 were: (i) the growth in the company's operating
result; (ii) the negative net financial result due to the effects of exchange variation on exports
and the operational hedge transactions ­ in 9M09 the real appreciated approximately 24%
versus devaluation of roughly 10% in the same period of the previous year; (iii) a reduction in
the effective Income Tax rate in 1H09, down from 29.0% to 19.1% (appropriation of the tax
benefit generated by the statement of interest on shareholder's equity for 2008, and the
advanced amortization of the goodwill resulting from the 2004 corporate restructuring.) We
would like to point out that, as of 2010, the effective Income Tax and Social Contribution rate
will no longer benefit from goodwill amortization.
Consolidated EBITDA totaled R$272.1 million in 3Q09 versus R$238.5 million in 3Q08, an
increase of 14.1%. The EBITDA margin dropped from 26.2% in 3Q08 to 25.8% in 3T09. In
9M09, consolidated EBITDA reached R$704.1 million, a 16.3% increase over the same period
in 2008 (R$605.2 million.)
3Q09
3Q08
Change %
9M09
9M08
Change %
Net Revenues
1,054.9
909.9
15.9
2,922.8
2,441.6
19.7
(-) Cost of Sales and Expenses
804.2
692.6
16.1
2,286.7
1,901.3
20.3
EBIT
250.7
217.3
15.3
636.1
540.3
17.7
(+) Depreciation/Amortization
21.4
21.2
1.1
68.0
64.9
4.8
EBITDA
272.1
238.5
14.1
704.1
605.2
16.3
> EBITDA (R$ million)
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> CASH FLOW
Free cash generation was R$270.2 million in 9M09 versus R$408.7 million in 9M08. Not
considering the R$122 million one-off effect of the credit policy for the 2007 Christmas sales
in the 2008 full year results, the free cash generation in 2009 would have fallen 6%.
Internal cash flow generation
6
in 9M09 totaled R$565.3 million, up 27.2% compared to the
R$444.3 million recorded in 9M08. From this total, R$181.8 million was invested in operating
working capital.
The investment in operating working capital in 3Q09 was due to the greater investment in
inventories, driven by the strategy of improving service levels for our consumers and by the
need to meet Christmas demand, in addition to decentralizing logistics and increasing
coverage in international operations.
Year-to-date investments in property, plant and equipment stand at R$76.8 million,
concentrated in information technology, improvements and expansion of production capacity.
6
(Net income for the period) + (depreciation and amortization)
9M09
9M08
Change %
Net income
497.3
379.4
31.1
(+) Depreciation and amortization
68.0
64.9
4.8
Internal cash generation
565.3
444.3
27.2
Operating working capital*
(181.1)
65.6
(376.3)
Other assets and liabilities**
(37.2)
(40.2)
(7.6)
Operating cash generation
347.0
469.6
(26.1)
Capex
(76.8)
(61.0)
26.0
Free cash flow***
270.2
408.7
(33.9)
> Consolidated cash flow ­ pro-forma (R$ million)
(*) Assets - Accounts receivable, inventories, and short-term recoverable taxes. Liabilities - Suppliers, payrolls,
profit sharing and social charges, tax liabilities, provisions, and freight payable.
(**) Assets - Advance to employees and suppliers, short-term deferred income and social contribution taxes,
other credits, and long-term assets. Liabilities - Other short and long-term accounts payable and provisions for
tax, civil, and labor losses.
(***) (Internal cash generation) +/- (changes in working capital and long-term assets and liabilities) ­
(acquisitions of property, plants, and equipment).
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3. Pro-Forma Statements of Income
The profit margin from exports from Brazil to international operations was subtracted from the
COGS of the respective operations, showing the actual impact of these subsidiaries
7
on the
company's consolidated result. Thus, the pro-forma Statement of Income for the Brazilian
operations shows only the result of local market sales.
3.1 BRAZILIAN OPERATIONS ­ pro-forma Statement of Income
7
This is fully adjusted, as these subsidiaries are wholly-owned by Natura Cosméticos S.A.Car
> Financial Highlights - Brazil
(R$ million)
3Q09
3Q08
Change %
9M09
9M08
Change %
Total Consultants -
end of period
*
(in thousand)
838.9
691.5
21.3
838.9
691.5
21.3
Unit sold ­ items for resale
(in million)
91.4
74.6
22.6
247.3
206.1
20.0
Gross Operating Revenues
1,354.6
1,163.7
16.4
3,735.3
3,146.8
18.7
Net Operating Revenues
979.1
857.2
14.2
2,711.4
2,301.4
17.8
Gross Profit
692.9
606.0
14.3
1,905.4
1,609.3
18.4
Gross Margin (%)
70.8%
70.7%
0.1 pp
70.3%
69.9%
0.3 pp
Sales Expenses
(321.0)
(287.4)
11.7
(897.6)
(767.3)
17.0
General and Administrative Expenses
(109.8)
(81.8)
34.2
(302.4)
(267.7)
13.0
Management compensation
(2.0)
(3.3)
(38.1)
(10.8)
(9.7)
10.8
Others Income / (Expenses), net
2.8
4.6
(38.2)
4.3
33.3
(87.2)
Financial Income / (Expenses), net
(15.8)
4.1
(482.2)
(21.5)
(9.2)
134.9
Operating Profit
247.2
242.2
2.0
677.4
588.9
15.0
Net Income
205.5
182.8
12.4
569.0
443.0
28.5
EBITDA
283.1
258.4
9.6
762.8
660.4
15.5
EBITDA Margin (%)
28.9%
30.1%
-1.2 pp
28.1%
28.7%
-0.6 pp
(*) Number of consultants by the end of the cycle 13 of sales
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The number of consultants in Brazil reached 839 thousand at the end of 3Q09, an
increase of 21.3% over 3Q08. Again, this increase reflects the impact of the
implementation of the CNO model, completed last May.
Regarding the Action Plan, we point out the increase in online orders, which accounted
for 74% of orders in the quarter (53% in 3Q08 and 44% in 3Q07.)
The quarter was also marked by highly successful launches of new product lines, as
mentioned in the beginning of this release.
We inaugurated a new "Casas Natura" in Guarulhos, São Paulo State in addition to one
in Cajamar for visitors, consultants and employees.
3.2 OPERATIONS UNDER CONSOLIDATION
(Argentina, Chile and Peru)
3Q09
3Q08
Change %
9M09
9M08
Change %
Total Consultants -
end of period
*
(in thousand)
108.1
85.5
26.5
108.1
85.5
26.5
Unit sold ­ items for resale
(in million)
6.6
4.8
38.4
16.2
12.9
26.2
Gross Operating Revenues
74.6
53.4
39.8
206.5
141.9
45.5
Net Operating Revenues
57.1
40.6
40.7
158.0
108.8
45.3
Gross Profit
36.1
24.7
46.1
103.9
67.8
53.2
Gross Margin (%)
63.2%
60.9%
2.4 pp
65.8%
62.3%
3.4 pp
Sales Expenses
(26.7)
(21.6)
23.8
(80.4)
(58.0)
38.7
General and Administrative Expenses
(6.7)
(4.4)
52.1
(17.0)
(13.0)
31.1
Others Income / (Expenses), net
1.0
(0.1)
-
1.4
(0.1)
-
Financial Income / (Expenses), net
0.4
(1.0)
-
0.1
(1.6)
-
Operating Profit
4.1
(2.3)
(278.4)
8.0
(4.8)
(266.5)
Net Income
1.7
(3.4)
(148.0)
1.5
(7.9)
(119.0)
EBITDA
4.3
(0.9)
(596.0)
9.5
(2.0)
(573.8)
EBITDA Margin (%)
7.5%
-2.1%
9.6 pp
6.0%
-1.8%
7.8 pp
(*) Number of consultants by the end of the cycle 12 of sales
> Financial Highlights - Operations under Consolidation
(Argentina, Chile and Peru)
(R$ million)
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11
Net revenues from operations under consolidation totaled R$57.1 million in 3Q09, an
increase of 40.7% (40.9% in weighted domestic currency) compared to 3Q08. In 9M09,
results were as follows: Net Revenue of R$158.0 million in 9M09 versus R$108.8 million
in 9M08, an increase of 45.3% (36% in weighted domestic currency.)
Gross profit margin is the result of efficient cost management, since the operational
currency basket was in line with the real in the period.
The number of consultants in operations under consolidation grew by 26.5%, reaching
108 thousand at the end of 3Q09.
These operations resulted in a positive EBITDA of R$4.3 million in 3Q09 versus a
negative EBITDA of R$0.9 million in 3Q08. In 9M09, EBITDA reached R$9.5 million
compared to R$2.0 million loss in the same period of 2008.
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12
Net revenues from operations under implementation totaled R$17.2 million in 3Q09, an
increase of 52.8% (64.9% in weighted domestic currency) versus 3Q08. Year-to-date,
revenue reached R$48.8 million, an increase of 68.1% (69.2% in local weighted
currency.)
The number of consultants grew 56.2%, reaching 40 thousand at the end of 3Q09.
These operations resulted in a negative EBITDA of R$7.0 million in 3Q09 versus a
negative EBITDA of R$9.3 million in 3Q08. This negative result was due to continuing
investments in Mexico and Colombia, in channel expansion and marketing.
3.3 OPERATIONS UNDER IMPLEMENTATION
(Mexico, Colombia and Venezuela)
3Q09
3Q08
Change %
9M09
9M08
Change %
Total Consultants -
end of period
*
(in thousand)
40.0
25.6
56.2
40.0
25.6
56.2
Unit sold ­ items for resale
(in million)
2.2
1.4
60.7
5.7
3.5
61.8
Gross Operating Revenues
19.8
12.9
53.5
55.9
33.3
68.0
Net Operating Revenues
17.2
11.3
52.8
48.8
29.0
68.1
Gross Profit
10.9
7.2
51.6
32.1
17.3
85.4
Gross Margin (%)
63.1%
63.6%
-0.5 pp
65.9%
59.8%
6.1 pp
Sales Expenses
(17.5)
(13.2)
32.6
(52.9)
(35.3)
50.0
General and Administrative Expenses
(1.9)
(3.3)
(44.1)
(12.7)
(9.5)
33.3
Others Income / (Expenses), net
1.0
(0.0)
-
(0.2)
(0.0)
-
Financial Income / (Expenses), net
(0.2)
(0.1)
-
(0.1)
(0.2)
-
Operating Profit
(7.7)
(9.4)
(18.4)
(33.7)
(27.7)
21.8
Net Income
(8.3)
(9.3)
(9.9)
(36.1)
(28.6)
26.5
EBITDA
(7.0)
(9.3)
(24.4)
(32.2)
(27.0)
19.3
EBITDA Margin (%)
-40.7%
-82.2%
41.5 pp
-66.0%
-93.0%
27.0 pp
(*) Number of consultants by the end of the cycle 12 of sales
> Financial Highlights - Operations under Implementation
(Mexico, Venezuela and Colombia)
(R$ million)
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13
Year-to-date EBITDA was a negative R$32.2 million, compared to negative R$27.0
million in 9M08.
NA
Other investments in the international area totaled R$8.4 million in 3Q09 versus R$9.9
million in 3Q08. Year-to-date losses amount to R$36.0 million, compared to R$26.3 million in
9M08. These investments are basically comprised of our operation in France and our one-off
expenses to discontinue the U.S. project.
> CONFERENCE CALL & WEBCAST
Portuguese:
Friday, October 23, 2009
10 A.M. ­ Brasília time (8 A.M. EST)
English:
Friday, October 23, 2009
12 P.M. ­ Brasília time (10 A.M. EST)
Brazilian callers: +55 (11) 4688-6301
US callers: Toll Free +1 (800) 860-2442
Callers from other countries: +1 (412) 858-4600
Access code: Natura
Live Webcast at:
www.natura.net/investidor

> INVESTOR RELATIONS
Telephone: + 55 (11) 4196-1421
Helmut Bossert,
helmutbossert@natura.net
Patrícia Anson,
patriciaanson@natura.net
Renata Chaves,
renatachaves@natura.net
Guilherme Fukuda,
guilhermefukuda@natura.net
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14
> Consolidated Income Statement
We would like to point out that the 2008 data are being presented again for two reasons:
(i) adjustments of Law 11,638/638 previously reflected in the 2008 results now shown by
quarter; and (ii) reclassification of raw material sales for processing by third parties,
previously considered revenue. We emphasize that this adjustment does not affect the
absolute value of the consolidated gross margin. We present below a table with the
reclassified values of gross revenue and net revenue:
> Gross Revenues and Net Revenues - Consolidated
1Q08
2Q08
3Q08
Restated
Previous
Restated
Previous
Restated
Previous
Gross Revenues
907.3
923.3
1,186.7
1,199.1
1,230.9
1,246.2
Net Revenues
657.8
668.0
873.9
883.1
909.9
921.1
Reclassificação entre linhas das vendas de matéria prima para industrialização em terceiros, anteriormente considerada receita. Destacamos que esse ajuste não afeta em valor absoluto a margem bruta da Natura Cosméticos S/A.
1Q09
2Q09
Restated
Previous
Restated
Previous
Gross Revenues
1,139.8
1,154.9
1,412.8
1,433.7
Net Revenues
833.6
844.7
1,034.3
1,049.4
R$ million
3Q09
3Q08
(Restated)
9M09
9M08
(Restated)
GROSS SALES
Gross sales to domestic market
1,353.4
1,163.4
3,729.3
3,142.3
Gross sales to foreign market
97.0
67.2
273.1
181.7
Other sales
0.3
0.3
1.0
1.0
GROSS OPERATING REVENUES
1,450.7
1,230.9
4,003.3
3,324.9
Taxes on sales, returns and rebates
(395.8)
(321.0)
(1,080.5)
(883.3)
NET OPERATING REVENUES
1,054.9
909.9
2,922.8
2,441.6
Cost of sales
(313.6)
(271.5)
(877.3)
(745.3)
GROSS PROFIT
741.3
638.4
2,045.5
1,696.4
OPERATING (EXPENSES) INCOME
Selling
(368.7)
(325.9)
(1,042.3)
(871.5)
General and administrative
(124.7)
(96.4)
(361.7)
(308.1)
Management compensation
(2.0)
(3.3)
(10.8)
(9.7)
Other operating income (expenses), net
4.8
4.6
5.4
33.3
INCOME FROM OPERATIONS BEFORE FINANCIAL EFFECTS
250.7
217.3
636.1
540.3
Financial expenses
(27.0)
(11.1)
(98.3)
(54.6)
Financial income
11.4
14.0
76.9
43.7
INCOME BEFORE TAXES ON INCOME
235.1
220.2
614.7
529.4
Income tax and social contribution - current
(56.7)
(29.1)
(147.8)
(166.9)
Income tax and social contribution - deferred
11.8
(31.4)
30.4
16.9
NET INCOME
190.2
159.7
497.3
379.4
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15
> Consolidated Balance Sheet on 09/30/2009 and 06/30/2009
ASSETS
3Q09
2Q09
CURRENT ASSETS
Cash, Banks and cash investments
231.8
295.6
Trade accounts receivable
435.9
373.9
Inventories
526.7
425.8
Recoverable taxes
137.6
129.0
Deferred income and social contribution taxes
86.9
76.9
Allowance for unrealized gains with derivatives
-
4.0
Advances to employees and suppliers
6.7
5.6
Other receivables
70.7
77.3
Total current assets
1,496.3
1,388.2
NONCURRENT ASSETS
Long-term assets:
Cash investments
5.7
5.5
Recoverable taxes
96.0
70.9
Deferred income and social contribution taxes
59.1
56.1
Escrow deposits
56.8
49.5
Advances to suppliers
1.8
1.8
Property, plant and equipment
455.8
455.9
Intangible assets
84.6
82.2
Total noncurrent assets
759.6
721.9
TOTAL ASSETS
2,255.9
2,110.0
LIABILITIES AND SHAREHOLDERS' EQUITY
3Q09
2Q09
CURRENT LIABILITIES
Loans and financing
477.0
325.4
Domestic suppliers
218.5
211.4
Foreign suppliers
4.3
7.5
Salaries, profit sharing and related charges
136.9
109.6
Taxes payable
204.2
181.6
Dividends
0.2
215.3
Accrued freight
24.2
26.9
Reserve for tax, civil and labor contingencies
19.7
17.8
Allowance for losses on swap and forward transactions
4.9
-
Other payables
34.4
25.3
Total current liabilities
1,124.3
1,120.8
NONCURRENT LIABILITIES
Loans and financing
129.6
143.3
Reserve for tax, civil and labor contingencies
56.1
57.5
Total noncurrent liabilities
185.7
200.8
SHAREHOLDERS' EQUITY
Capital
402.1
401.2
Capital reserves
143.3
142.0
Profit reserves
161.7
160.9
Valuation adjustments to shareholders' equity
(18.4)
(7.5)
Treasury shares
(0.0)
(0.0)
Retained earnings
257.1
92.0
Total shareholders' equity
945.9
788.4
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
2,255.9
2,110.0
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16
> Consolidated Cash Flow Statement
R$ million
9M09
9M08
(Restated)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income
497.3
379.4
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
68.0
64.9
Inflation and exchange rate fluctuations
(27.8)
16.8
Allowance for (gains) / losses on derivative transactions
(1.0)
2.5
Reserve for tax, civil and labor contingencies
(0.1)
4.9
Deferred income tax and social contribution
(31.4)
(16.9)
Proceeds from sale and disposal of property, plant and equipment and intangible assets
5.2
8.6
Interest on loans and financings
20.7
21.9
Expenses on stock options plans
5.1
5.0
Allowance for inventory losses and doubtful accounts
2.6
1.6
Subtotal
538.4
488.5
(INCREASE) DECREASE IN ASSETS
Current assets:
Trade accounts receivable
35.3
163.5
Inventories
(196.4)
(102.7)
Recoverable taxes
(15.3)
(56.1)
Other receivables
(2.6)
35.8
Noncurrent assets (long-term assets):
Escrow deposits
(8.3)
(7.1)
Recoverable taxes
(75.2)
(0.4)
Other receivables
6.2
2.3
Subtotal
(256.2)
35.3
INCREASE (DECREASE) IN LIABILITIES
Current liabilities:
Suppliers
36.6
15.1
Salaries, profit sharing and related charges, net
6.2
26.9
Taxes payable, net
26.4
(37.8)
Other payables
(3.4)
(2.9)
Noncurrent liabilities (long-term liabilities):
Other payables
(10.8)
(16.3)
Subtotal
54.9
(15.0)
NET CASH PROVIDED BY OPERATING ACTIVITIES
337.1
508.8
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property, plant and equipment and intangible assets
(76.8)
(61.0)
NET CASH USED IN INVESTING ACTIVITIES
(76.8)
(61.0)
CASH FLOWS FROM FINANCING ACTIVITIES
Repayments of loans and financing - principal
(330.3)
(423.0)
Repayments of loans and financing - interest
(15.8)
(13.6)
Funding - loans and financing
496.0
374.6
Payments of derivative transactions
12.3
(8.0)
Payment of dividends
(469.4)
(425.7)
Payment of interest on capital
(82.5)
-
Capital increase
10.7
0.3
Acquisition of treasury shares
-
(21.1)
Sale of treasury shares due to exercise of stock options
-
3.1
NET CASH USED IN INVESTING ACTIVITIES
(379.0)
(513.4)
INCREASE (DECREASE) IN CASH AND BANKS
(118.7)
(65.5)
Cash, banks and cash investments at beginning of year
350.5
405.4
Cash, banks and cash investments at end of year
231.8
339.9
INCREASE (DECREASE) IN CASH AND BANKS
(118.7)
(65.5)
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17
This report contains forward-looking statements. This information represents not only historical facts, but also reflects the wishes
and expectations of Natura's management. The words "foresees", "wishes", "hopes", "forecasts", "intends", "plans", "predicts",
"projects", "aims" and similar terms intend to identify statements that, necessarily, involve known and unknown risks. Known
risks include uncertainties, which are not limited to the impact of price and product competition, product acceptance in the
market, the product transition of the Company and its competitors, regulatory approval, currency, currency fluctuation, supply
and production difficulties and changes in product sales, among other risks. This report also contains "pro forma" information,
prepared by the Company to be used exclusively for information and reference purposes; therefore, they are non-audited figures.
This report is updated up to the present date and Natura does not undertake to update it in the event of new information and/or
future events.