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Brazilian beauty conglomerate Natura & Co is considering a sale of The Body Shop after the skin care and cosmetics line saw another quarter of declining sales, according to a Monday securities filing.
Natura & Co, which owns the Avon and Natura brands and is in the process of selling its Aesop line to L’Oreal, wrote in the filing that its board of directors “recently authorized its management to explore strategic alternatives for The Body Shop,” the filing said.
Those alternatives include a “potential sale” of the business, according to the document.
“There can be no assurance that this process will result in any transaction. Natura does not intend to comment on or provide updates regarding this matter unless and until it determines that further disclosure is appropriate or required,” the filing said.
Late last year, Sao Paulo-based Natura denied rumors that it was considering a sale of The Body Shop. But a year later, it’s looking for a buyer after sales at the brand declined for numerous quarters.
On Aug. 15, the company announced second-quarter results and said sales at The Body Shop fell 12% to 800 million Brazilian reals, or $163.7 million.
The brand, which sells natural skin, hair and makeup products, has a heavy mall footprint in the U.S. It has faced pressure on its top line for numerous quarters.
Executives have worked to boost sales and reduce costs at the chain in a bid to grow margins and generate cash.
Retail as a whole has seen sluggish sales amid consistent inflation and high interest rates, but the beauty sector has been a rare bright spot. Numerous cosmetics companies have reported consistent growth and profits.
However, The Body Shop has struggled to hang on to its market share and meet customers where they are after consumer habits shifted during the Covid pandemic, executives said during an August earnings call.
To reverse the sales slump, the company has tried to boost digital sales and revamped its product line to focus more on skin care.