UBS Pactual Eighth Annual CEOs Conference

Apresentação em tema: "UBS Pactual Eighth Annual CEOs Conference"— Transcrição da apresentação:

1 UBS Pactual Eighth Annual CEOs Conference
march 05th-07th, 2007

2 highlights 2

3 highlights 2006 Gross Revenues: R$ 3.9 billion in 2006
Market share: 22.8% in Brazilian core market in 2006 Total consultants: 617 thousand in December 2006 International presence: Brazil, Argentina, Chile, Peru, Mexico, France and Venezuela Opening of the first Casa Natura in Brazil, in the city of Campinas, state of São Paulo Expansion of the Distribution Center located in the city of Mathias Barbosa, state of Minas Gerais Start up direct sales tests and opening a research laboratory in Paris – France WARM UP 3

4 CF&T market 4

5 CF&T core market – Brazil
> Core Market1 – Net Revenues (R$ billion, nominal) CAGR ( ) = 16.5% 11.4 10.1 8.7 7.2 6.3 +13.4% 5.3 CONTINUAMOS OBSERVANDO UM CRESCIMENTO NO MERCADO BRASILEIRO DE COSMÉTICOS, FRAGRÂNCIAS E HIGIENE PESSOAL, O QUAL REFLETE A VITALIDADE DESTE SETOR . 2001 2002 2003 2004 2005 2006 Target market: Skin care, sunscreen, makeup, perfums, fragrances, hair care, shaving products and deodorant - excludes diapers, nail polishes, sanitary pads, hair dyes and oral hygiene. Source: Sipatesp/ ABHIPEC. 5

6 market share – Brazil > Natura’s Market Share in the Core Market1 (%) 22.8% 21.4% 19.2% 17.1% 14.3% 14.5% +1.4 pp A NATURA CONTINUOU GANHANDO MARKET SHARE NO SEU MERCADO ALVO, ATINGINDO 22,8% EM 2006. 2001 2002 2003 2004 2005 2006 Target market: Skin care, sunscreen, makeup, perfums, fragrances, hair care, shaving products and deodorant - excludes diapers, nail polishes, sanitary pads, hair dyes and oral hygiene. Source: Sipatesp/ ABHIPEC. 6

7 4Q06 and FY06 results 7

8 consolidated gross revenues
> Consolidated Gross Revenues (R$ million) 3,890 CAGR ( ) = 27.2% 3,244 2,540 +19.9% 1,910 A RECEITA BRUTA APRESENTOU UM CRESCIMENTO DE 19,9% EM 2006 E 16,6% NO 4T06. 1,411 1,201 1,168 1,030 +16.6% 2001 2002 2003 2004 2005 2006 4Q05 4Q06 8

9 consolidated gross revenues
4Q06 gross revenues were R$1.2 billion, frustrating our expectation (+16.6% over 4Q05). Main drivers that contributed for this performance: • Significant change in our merchandising strategy at the end of the year • Higher promotional kits sales (lower margins) • Cannibalization of regular products 9

10 consolidated EBITDA > EBITDA (R$ million) CAGR (2001-2006) = 36.9%
655 564 CAGR ( ) = 36.9% 432 +16.0% 296 O EBTIDA APRESENTOU UMA EVOLUÇÃO DE 16,0% EM 2006 E UMA QUEDA DE 8,9% NO 4T06. 199 195 178 136 -8.9% 2001* 2002 2003 2004 2005 2006 4Q05 4Q06 (*) Natura Empreendimentos. 10

11 consolidated EBITDA margin
26.8 24.4 24.7 23.7 22.2 20.8 20.1 -1.0 pp -6.0 pp CONSEQUENTEMENTE A MARGEM EBITDA NO ANO CAIU 1PP PASSANDO DE 24,7% PARA 23,7%. NO ENTANTO, NO TRIMESTRE ESTA QUEDA FOI AINDA MAIOR, PASSANDO DE 26,8% NO 4T05 PARA 20,8% NO 4T06. 2002 2003 2004 2005 2006 4Q05 4Q06 11

12 consolidated EBITDA 4Q06 EBITDA was R$178 million (-8,9% compared to 4Q05), as a result of: • Increase on promotional kits sales (lower margins) • Increase on discounts and promotions in the total sales mix • Some administrative expenses above expectations in the 4Q06 12

13 CAPEX > CAPEX (R$ million) CAPEX 2007 BREAKDOWN:
194 190 112 CAPEX 2007 BREAKDOWN: (i) EXPANSÃO DA CAPACIDADE DE PRODUÇÃO E LOGISTICA (ii) OBRAS CIVIS DO NOVO CENTRO DE P&D (iii) TECNOLOGIA DA INFORMAÇÃO 83 2004 2005 2006 2007E 13

14 consolidated cash flow – pro forma
R$ million 2006 2005 Change % Net income 460.8 396.9 16.1 (+) Depreciation and amortization 54.6 44.0 24.0 (=) Internal cash generation 515.4 440.9 16.9 (-) Operating working capital1 -73.1 -3.7 (-) Other assets and liabilities2 -46.7 1.5 INVESTIMENTO EM CAPITAL DE GIRO OPERACIONAL CONCENTRADO EM ESTOQUES - QUEBRA DE VENDAS NO 4T06 OUTROS ATIVOS E PASSIVOS: DEPÓSITO JUDICIAL NO VALOR DE R$28MILHÕES REFERENTE AO PROCESSO QUE QUESTIONA O DIREITO A CRÉDITO DE IPI NA AQUISIÇÃO DE INSUMOS COM ALÍQUOTA ZERO. (=) Operating cash generation 395.5 438.7 -9.8 (-) Capex -193.6 -111.6 (=) Free cash flow 202.0 327.1 -38.3 (1) Assets – Accounts receivable, inventories and recoverable taxes short term. Liabilities - suppliers, salaries, profit sharing and related charges, taxes payable, provisions and accrued freight. (2) Assets - Advances to employees and suppliers, short term deferred income tax and social contribution, other credits and long term receivables. Liabilities: other short and long term payables and reserve for contingencies 14

15 channel innovation brand 15

16 consolidated number of consultants
> Total Number of Consultants1 (thousands) 617 CAGR ( ) = 15.5% 520 433 375 +18.6% 321 300 O NÚMERO CONSOLIDADO DE CONSULTORAS ATINGIU 617 MIL AO FINAL DE 2006, MAIS DE 18% SOBRE O ANO ANTERIOR. 2001 2002 2003 2004 2005 2006 (1) Consultants in Argentina, Brazil, Chile, Peru e Mexico. 16

17 productivity > Productivity in Brazil (R$ thousand per average active consultant) CAGR ( ) = 8.0% 12.3 12.5 11.5 10.5 9.0 8.5 +1.9% IMPORTANTE DESTACAR A PRODUTIVIDADE DAS CONSULTORAS, CRESCENDO 1,9%. 3.6 3.5 -1.8% 2001 2002 2003 2004 2005 2006 4Q05 4Q06 17

18 productivity > Productivity in Brazil – Natura vs. Direct Sales Industry (R$ thousand per average active consultant in 2006) 12,5 1.5x 8,2 IMPORTANTE DESTACAR A PRODUTIVIDADE DAS CONSULTORAS, CRESCENDO 1,9%. Industry (except Natura) Natura Source: ABVED 18

19 brand perception Preference Innovation Quality 2nd in rank 43% 43% 19%
2005 2006 2006 Preference 43% 43% 19% Innovation 68% 70% 52% IMPORTANTE DESTACAR A PRODUTIVIDADE DAS CONSULTORAS, CRESCENDO 1,9%. Quality 70% 73% 61% Source: Survey commissioned by Natura. Conducted with 1,200 people across different social classes in three large Brazilian cities (São Paulo, Porto Alegre and Recife). 19

20 innovation > Total Innovation Index –
> Number of New Products – innovation + improvements > Total Innovation Index – innovation + improvements % 69.8 63.2 58.4 225 213 48.8 182 EM 2006 FORAM LANÇADOS 225 NOVOS PRODUTOS COM DESTAQUE PARA O PERFUME NATURA HUMOR E PARA A LINHA DE MAQUIAGEM NATURA DIVERSA. O INDICE DE INOVAÇÃO DIMINUIU DE 69,8% EM 2005 PARA 58,4 EM 2006, REFLEXO DE UMA MENOR EFETIVIDADE DE ALGUNS LANÇAMENTOS REALIZADOS EM 2005. 117 2003 2004 2005 2006 2003 2004 2005 2006 20

21 international expansion 21

22 highlights – operations under consolidation
> Financial Highlights – Argentina, Chile and Peru (US$ million) 4Q06 4Q05 Change% 2006 2005 Change% Total de Consultants1 51.2 36.2 41.7% 51.2 36.2 41.7% Units sold – items for resale 4.0 2.2 83.3% 11.6 7.0 65.0% (in millions) Gross Revenues 17.6 11.6 52.0% 54.9 36.2 51.8% HIGHLIGHTS DAS OPERAÇÕES EM FASE DE CONSOLIDAÇÃO. Net Revenues 13.5 8.9 51.6% 42.0 27.8 51.1% Ebitda -3.4 -1.5 135.9% -6.8 -4.5 51.1% Ebitda Margin -25.4% -16.3% -16.3% -16.3% (1) Position at the end of the 17th sales cycle period. 22

23 highlights – operations under implementation
> Financial Highlights – Mexico, Venezuela and France (US$ million) 4Q06 4Q05 2006 2005 Total de Consultants1 5.0 1.4 5.0 1.4 Units sold – items for resale 0.23 0.05 0.58 0.06 (in millions) HIGHLIGHTS DAS OPERAÇÕES EM FASE DE IMPLANTAÇÃO. Gross Revenues 2.0 0.7 5.1 1.2 Net Revenues 1.7 0.6 4.4 1.1 Ebitda -5.4 -3.3 -16.7 -10.0 (1) Position at the end of the 17th sales cycle period. 23

24 international expansion
> Total Net Expenses1 (R$ million) 48.0 39.6 31.8 PARA 2007, ESTIMAMOS INVESTIMENTO TOTAL DE R$ 48 MILHÕES NO PROCESSO DE EXPANSÃO INTERNACIONAL, DEVIDO AO INVESTIMENTO NA OPERAÇÃO MEXICANA E INÍCIO DAS OPERAÇÕES NA VENEZUELA E COLÔMBIA. 2005 2006 2007E (1) Considers operating loss from operations under consolidation (Argentina, Chile and Peru) added to operations under implementation (Mexico,Venezuela and France); and exchange rate impact on controlled companies balance sheet translations, excluding reported gains in trading from Brazil to these companies. 24

25 perspectives 25

26 perspectives Maintain the strategy with adjustments in the implementation • Improve efficiency in our marketing actions, and better balance between short and long-term actions • Freeze on administrative structure expenses for the coming two years • Search for productivity gains – operational processes • Maintain autonomous administrative structure dedicated to Brazilian and international operations 26

27 perspectives Focus on the international operations, based on the following aspects: • Continue to invest in Argentina, Chile and Peru, focused on the achievement the break even • Consolidate our presence in Latin America, opening operations in Venezuela and Colombia in 2007 • Search for new markets, starting with new operations in the United States and Russia, in 2008 • Triple Bottom Line and quality in relations 27

28 This presentation contains forward-looking statements
This presentation contains forward-looking statements. Such statements are not statements of historical fact, and reflect the beliefs and expectations of the Matura's management. The words "anticipates“, “wishes”, “expects”, "estimates“, “intends“, "forecasts“, "plans“, "predicts“, "projects“, "targets" and similar words are intended to identify these statements, which necessarily involve known and unknown risks and uncertainties. Known risks and uncertainties include, but are not limited to, the impact of competitive products and pricing, market acceptance of products, product transitions by the Company and its competitors, regulatory approval, currency fluctuations, production and supply difficulties, changes in product sales mix, and other risks. This presentation also includes pro-forma information prepared by the Company for information and reference purposes only, which has not been audited. Forward-looking statements speak only as of the date they are made, and the Company does not undertake any obligation to update them in light of new information or future developments.