The Body Shop's Getting a Facelift, Natura &CO Chairman Says

(Bloomberg) -- Natura &CO is working on the renewal of The Body Shop brand, Chairman Roberto Marques said.

It’s time to bring the brand’s "voice" back and create a more "activist" approach, including greater connection with youth, said Marques, who leads the board that governs brands for Natura Cosmeticos SA. A team has been formed to handle the brand’s retooling, and marketing expenses are expected to increase. Margins were already hit in the last quarter of 2017 with greater marketing costs and higher executive compensation on the back of good results, Natura Cosmeticos Chief Executive Officer Joao Paulo Brotto Ferreira said in the same telephone interview.

The move comes after Natura had an "incredible" year, especially in Brazil, where it gained in revenue growth and market share, leading key markets such as body care and fragrance, Ferreira said. Brazil should keep growing at a similar pace in 2018, and Natura expects to grow above rivals while continuing to regain market share.

Shares reversed earlier gains of as much as 4.6 percent to drop 2.5 percent after the company reported fourth quarter profit and revenue that beat the highest estimates. Natura also said it would deleverage to the same debt/Ebitda level it had before the acquisition of The Body Shop a year earlier than expected. Shares are down 2 percent in 2018 compared to a 11.2 percent increase in the Ibovespa.

To contact the reporter on this story: Paula Sambo in Sao Paulo at psambo@bloomberg.net.

To contact the editors responsible for this story: Arie Shapira at ashapira3@bloomberg.net, Christiana Sciaudone

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