Natura Returns to Profit in Latin America Core After Q4 Margin Surge

Overview

• Q4 2025 profit from continued operations reached R$186 million versus a R$227 million loss a year earlier, dampened by a non-cash R$434 million provision tied to The Body Shop sale; excluding it, profit would have been R$620 million.
• Net revenue fell 12.1% to R$6.1 billion, reflecting slower sales in Brazil, operational instability in Argentina linked to integration, currency strength against Hispanic markets and Argentine hyperinflation.
• Adjusted EBITDA jumped 57.2% to R$978 million with a 15.8% margin, while full-year adjusted EBITDA rose 9.5% to R$3.1 billion.
• Net debt declined to about R$3.5 billion and leverage improved to 1.57x, or 1.31x excluding the provision, supported by seasonal cash generation.
• Management reports early March revenue improvement, has reset sales-force incentives and resolved product availability issues, and plans a gradual Avon relaunch from Q2 2026, as shares rose roughly 9% and analysts highlighted deep cost cuts including about a 25% administrative reduction.