Santander 11th Annual Conference São Paulo, BR | August, 2010

Company Overview

Our History
70‟s 80‟s 90‟s 00‟s Current Moment
4.300

657 170 5 A small laboratory and two passions: cosmetics and relationships (1969) Choice to purse a direct sales platform (1974) Strong growth based on regional expansion and products portfolio Commitment with social and environmental responsibility Seek to excel in management Sustainable development focus Management model evolution

Natura Ekos Line developed (2000)
Natura Space, Cajamar site opened (2001) IPO on the Bovespa (2004) Follow on BOVESPA Free Float to 40% (2009)

New circle of growth among other Latin American countries
Increased leadership in Brazil

Sales Volume Evolution (retail) in US$ million

3

Where we are…
France

Mexico

7.4

Colombia

3.0

Peru

1.4 28.4

Brazil

Chile

1.7

2.9 Size of CF&T Market Retail Price, 2009 (US$ billion)
Source: Euromonitor

Argentina

4

Value Proposition .

Differentiated Value Proposition Attractive market with differentiated growth profile channel brand corporate behavior products Delivery of “Triple Bottom Line”: › Strong cash flow generation › Attractive growth and profitability › Consistent dividend payments 1 Economic: › Wealth creation to consultants › R$ 60 million invested in CSR 1 in 2009 › Benefits extended to extractives communities Social: › › › › Carbon neutral operations Utilization of refill packages Sustainable extraction Use of recycled and recyclable materials Environmental: Corporate and Social Responsibility 6 .

5% 31.4x that 7 .2% 9. Chile.„09 1.Relevant market with differentiated growth in LatAm… Size of CF&T market Countries (in US$ billion) CAGR % „04.6% 28.2% 2.5% 38. Colombia and Peru 40 28 7 9 0.1% Asia Pacific North America Western Europe Australasia Africa / Middle East Source: Euromonitor 2009 The markets in which Natura operates represent 12.8% 19.2% 5.0% 11.3% 24.3% Japan Brazil Mexico Argentina.7% 8.6% Direct sales share in the CF&T Market Region Direct Sales (%) 2009 United States 59 Latin America Brazil Argentina Chile 27.1% 7.8% Colombia Mexico Peru Countries in which Natura operates World Source: Euromonitor 2009 44 351 12.5% 3.7% 14.4% 10.5% of the global CF&T market and have a growth rate of of the total market 2.4% 23.

.2% 9.4% Core market growth in real terms 2.6% 10.. Central Bank and Abihpec 8 .9% Source: IBGE..7% 1.5% 7.2% 3.1% 5.8% 10.3% 10.2% 3.1% 8.8% 5.9% Demand drivers in Brazil › Increasing purchasing power of C and D income classes › Greater participation of women in the labor market › Cultural emphasis on personal and aesthetic treatments 2010E 6. leveraged in the Brazilian context Core market growth in real terms vs.7% 3.4% 5.0% 12. GDP in Brazil GDP growth 2002 2003 2004 2005 2006 2007 2008 2009 CAGR ‘02.1% -0.‘09 2.4% 8.

3 6.3 6.8% 2. Market Share Total CF&T (Euromonitor) (Percentage) Core Market (ABIHPEC / SIPATESP) Natura Market Share per Segment 13.7 6.7% 2003 2004 Natura 2005 2006 Unilever 2007 Avon 2008 2009 1st Bi 10 Procter & Gamble Source: Euromonitor 2009 O Boticario Colgate 9 .9 T: 12..3 6.9 9.7% 9.1 CF: 38.2 12.5 7.6 10.Leadership position in Brazil.5 23.9 7.

.6 billion 3.5%) Unilever (9.46% LATAM +0.28pp Colombia 23º 33º-> 23º Avon (11.421 (28º) 2.3%) Unilever (8.52% 2.5 7.744 (25º) 1.15pp Mexico 22º 30º-> 22º +0.734 28.2%) P&G (12.9%) Avon (9.3%) Colgate (11.75% 1.24pp Brazil 1º Steady Total Natura 12º 16º-> 12º Unilever (15.1%) P&G (13.43% 244..45% 0.45% 2.67pp Peru 8º 10º-> 8º P&G (15.2%) Unilever (10.738 3.5%) P&G (16.78pp Chile 9º 10º-> 9º +0.3%) L'Oréal (10.gaining share in LATAM Sales Natura (at retail prices)¹ (US$ Million) Total Market (LATAM²) : US$53.984 Share Natura 2009 LATAM 7.43% Share Natura 2009 Evolução Share 2008 -> 2009 Ranking Natura 2009 Ranking Evolution Natura 2008 -> 2009 Top 3 Players (mkt share) 0.8%) Belcorp (8.7%) Unilever (9.7%) Unilever (18.948 (21º) 16.9%) Colgate (9.55pp Argentina 6º 11º-> 6º +0.4%) +0.2%) Avon (12.3%) +0.2%) Natura (13.415 (3º) 10 10 .16% +0.399 (11º) 1.9%) Avon (9.5%) Total sales at retail price (global ranking) ¹ Source: Euromonitor 2009 3.1%) P&G (10.049 (20º) 7.99% 4.40pp (Natura) 13.1%) P&G (10.

3 11.1 5.3 14.6 98.4 15.9 13.3 42 47 46 Ranking 1º 2º Company Petrobrás (Oil) Bradesco (Bank) Itaú Unibanco (Bank) 18 16 16 18 16 16 3º 4º Banco do Brasil (Bank) Natura (Cosmetics) Skol2 (Beverages) 2007 Natura 2008 2008 2nd place 2009 2009 5º 6º 6. Cap (in R$ BN) 347.4 76.2 154.2 Source: Ipsos Brand Essence Natura 2nd place 1 2 Source: BrandAnalytics and Millward Institute Considers Ambev's Market Cap 11 .Brand recognition in Brazil CF&T brand by preference (%) 47 46 Most valuable brands among Brazilian public companies (2009)¹ Brand value (in R$ BN) 19.0 Mkt.1 103.

Brand Position Massive Masstige Prestige Source: Booz & Company research. 2009 12 .

95 /each 3 unit package R$ 10.94 each 5 unit package R$ 4.50 /each 1 unit package 13 .R$ 2.

6 (+19.9 (+17. 2009 Source: Company.9% 177 140 +21.000 consultants trained in 2009 Training 942 875 799 731 632 719 Business model that generates income and work +19.7 (+26.034 939 850 Int’l 2Q: 177.119.8% ) Total 2Q: 1.2 times higher than its peers 1.Channel strength Available consultants (in thousands) Brazil 2Q: 941.8% 159 119 86 +33.9%) Channels differentiations High productivity1 2.119 1. ABEVD (Brazilian Association of Direct Sales Companies) HAY Consultant annual opinion poll for consultants satisfaction 14 .8% Low turnover 36% on average High satisfaction2 90% in 2009 2007 2008 2009 2007 1H09 2008 2009 1H10 2007 2008 2009 1H09 1H10 › › › › 1 2 Consultants are Natura‟s first consumers Drive sales through personal relationships Channels disseminate Natura's values with consultants acting as agents of social transformation Natura reached 1 million consultants in October.3%) 583.

1 GR: up to 15 CNOs 1 CNO : up to 150 CNs GR – Relationship Manager CNO – Natura Super Consultant CN – Natura s Consultant 1 GR: 600 CNs 1 GR: up to 2.250 CNs 15 Hired under CLT regulations .048 CNs CN CN CN CN CN CN CN 1 GR By the end of the 9th cycle.Commercial model .CNO • Platform for channel growth • Stronger and more productive relationship with our consultants • Greater emphasis on training Old Model CNO Model CN CN CN CN CNO CN Brazil (2010) CN CNO CN GR CN CNO GR 1 GR 1 CNO 11 CNOs 96 CNs 1.

Innovation Number of new products & innovation index¹ › Products with functional.1% › Sustainable use of Brazilian biodiversity 183 › Open Innovation 123 113 exceeded 50% of the projects 38 52 3.8% 56.6% 68.6%* 2009 1H09 1H10 Number of launches Innovation Index * Percentage of net revenue invested in innovation Source: Company Note: 1 Percentage of products launched in the last 24 months in the company‟s revenues 16 .7% 67.6% 64.5%* 2007 2.9%* 2008 2. emotional and philosophical benefits 68.

Summer Winter Launches 2010 Ekos Line Chronos Line 17 .

2009 (Carta Capital) 18 . employees.500 people involved » Third company to be publicly listed on the Bovespa Novo Mercado » First Latin American Company to adopt the 2001 Global Reporting Initiative (GRI) » Part of ISE – Corporate Sustainability Index » Best company (Exame). consumers. supplier communities and investors » 1. Most admired company in Brazil.Corporate behavior » Evolution on relationship quality » Systematic process of stakeholder engagement: Consultants.

Triple Bottom Line Results 19 .

63 2007 2008 2009 2007 2008 2009 » » Carbon Free since 2007 Ekos 10th anniversary: Sustainable use of biodiversity and cultural heritage.82 CO2 emissions Power consumption per product sold (Kjoules / unit) 552. benefiting 2.1% of the consultants joined the voluntary product selling Climate research » consultants: 90% in 2009 » employees: 74% in 2009 » suppliers: 82% in 2009 20 .3 3.9 447.Social and Environmental Results (CO2 emitted / Kg of product sold) 4.02 3. Engagement with 26 communities.1 598.084 families » » Crer Para Ver program – improvement of brazilian public education: 7.

5% Net Income and Margin (R$ million) CAGR „07-„09 = 21.5% 16.5% 4.2% 32.1% 15.0% Consolidated net incom 8.5% EBITDA and Margin (R$ million) CAGR „07-„09 = 19.073 2.1% 14.6% 23.008 860 706 575 439 465 518 307 333 2007 2008 2009 1H09 1H10 2007 2008 2009 1H09 1H10 2007 2008 2009 1H09 1H10 Source: Company 21 .5% 684 1.Economics Net Revenues (R$ million) CAGR „07-„09 = 17.5% 16.2% 18.576 3.0% 24.4% 14.242 3.298 1.0% 31.0% 17.8% 25.1% 23.0% 23.868 23.

2 500 415 0.2 0.1 598 2007 2008 2009 2010E 2007 2008 2009 2007 2008 2009 Source: Company 22 .Economics Capex (in R$ million) Leverage (Net debt / EBITDA) Dividends paid and pay-out ratio (in R$ million) CAGR „07-„09 = 20.0% 250 96% 89% 87% 136 110 141 0.

5 + 32.9 114.4) 2009 1H09 1H10 (37.9 5.6 (Argentina.Economics – International operations Net revenues (R$ million) Operations in implementation (R$ Million) Operations in consolidation (R$ Million) + 67. Peru) 121. Chile.7% in local currency 164.0% in local currency 66.2 100.0 43.4 44.0 (Mexico and Colombia) 21.0) 2007 2008 (1.5 218.2 (12.3) 23 .8 (25.3 31.1) (42.4) (28.7 2007 2008 2009 1H09 1H10 2007 2008 2009 1H09 1H10 EBITDA (R$ million) 2007 2008 2009 1H09 1H10 8.8) 1.9) (5.

Looking Ahead 24 .

Looking ahead Brazil Continue enhancing leadership via brand and channel strength Opportunity to gain its market share in sub-categories Management Model Managing through processes Strengthening organizational culture Leadership development Business and regional units Latin America New growth cycle Business model focused on increased customization Corporate behavior Consistent investments: Increase in CAPEX IT (commercial and logistic processes) Logistic Model Production capacity 25 .

Management model › Leadership development › Strengthening of corporate culture based on Natura's core values › Implementation of regional and business units Business Units Management by Category and Brands › Proximity to market A B C D Regional Unit São Paulo Metro › Regionalization of marketing mix › Increased autonomy and accountability › Leadership development opportunities Channels São Paulo Countryside Mid West1 North/Northeast South Note: 1 Includes the Mid West region and the following states: Minas Gerais. Rio de Janeiro and Espírito Santo 26 .

with others. the quality of the relationships it establishes and the quality of its products and services. identified with the community of people who are committed to building a better world. Natura will be an international brand. based on better relationships among themselves. with nature of which they are part. .Vision Because of its corporate behavior. with the whole.

IR Team +55 11 4196-1421 www.net/investidor Helmut Bossert Patricia Anson Bruno Caloi .natura.

Back Up .

The search for beauty. Everything is interdependent. Nothing in the universe exists alone.Beliefs Life is a chain of relationships. solidarity. The company. organizations. must be free of preconceived ideas and manipulation. and life in all of its manifestations. 30 . and society. is a dynamic set of relationships Its value and longevity are connected to its ability to contribute to the evolution of society. the greater the wealth and vitality of the whole system. Continuously striving for improvement develops individuals. which is the genuine aspiration of every human being. Commitment to the truth is the route to perfecting the quality of relationships. We believe that valuing relationships is the foundation of an enormous human revolution in the search for peace. The greater the diversity. a living organism.

and gratifying relationship of a person with others. successful. Well-being is the harmonious. . Being well is the empathetic. with one's body. with nature and with the whole. pleasant relationship of a person with oneself.Beliefs Reason for being Our reason for being is to create and sell products and services that promote wellbeing/being well.

Ekos sustainable use of biodiversity .

Chronos a truly beautiful woman .

Todo Dia (every day) caring for body and mind .

Mamãe e Bebê (mom and baby) the importance of the bond between parents and their children .

excludes diapers.1% 2008 2009 2008 2009 2008 2009 (1) Core market: Skin care.0% 33.6% 21. hair care. shaving products and deodorant .5% 12.2 8.5 15. fragrances. sunscreen.1 +14.4% +14. perfumes. sanitary pads.3 8. 36 .3 7.3 9. hair dyes and oral hygiene.7% +14.Brazil Cosmetics and Fragrances (R$ billion) + 93 bps 33. Source: Sipatesp/ ABIHPEC. nail polishes.9% 11. makeup.2% Toiletries (R$ billion) + 121 bps CF&T Market¹ (R$ billion) + 111 bps 22.4% 17.Core Market CF&T .

Productivity .391 2.Brazil Consultant Productivity1 in Brazil (R$ per average available consultant) 9.622 9.498 2.493 2.457 2007 (1) At retail prices. 2008 2009 2Q09 2Q10 1H09 1H10 37 .8% 4.495 9.5% 2.386 4.

4% 2009 NATU3: +101.2% Ibov: +33.4% Ibov: +47.9% Ibov: +28.3% 2006 NATU3: +51.9% Ibov: -3.NATU3 Performance 2004 NATU3: +87.0% Ibov: -41.6% NATU3 23/07/2010 R$41.7% 2010 NATU3: 15.1% 2007 NATU3: -41.0% 2005 NATU3: +37.1% Ibov: +29.4% 2008 NATU3: +18.6% Ibov: +82.10 Natu3 Ibovespa 632% NATU3 26/04/2004 R$6.67 251% 38 .

5 207.6% 35.9) 333.4) 1.5% 69.2 506.867.6) (19.7 2.298.3 (301.2 (1.3% 16.0) 191.2% 14.9 (563.0 (711.8) (12.6 291.5 (100.P&L Natura R$ million 2Q10 2Q09 1H10 1H09 NET REVENUES Cost of sales GROSS PROFIT Operating expenses Financial income (expenses).6 (566.4) 1.4) (13.6% 33.6 (400.9) (12.9) (12.2% 14.5 (72.7) 0.9% 70.3% 32.8% 11.9 (39.0 Ratios Gross Margin G&A / Net revenues Selling Expenses / Net revenues Net Margin 68.7) 168. net Other operating income (expenses).3% 69.8% 35.5) 307.2) 1. net INCOME BEFORE INCOME TAX AND SOCIAL CONTRIBUTION Income tax and social contribution NET INCOME FOR THE YEAR 1.034.8% 10.046.6 (912.0% 10.4% .9 (173.5 (505.586.304.8% 11.4% 16.8) (19.1) 883.1 379.8) 732.8) 0.8) 1.283.

115 Up to 804 E .2% since 2003 18.B and C (FGV) until 2020 › 20 million people left poverty 30.Purchasing power is increasing in Brazil.2% 15.808 D Source: FGV 2009 804 -1.Social Income Classes 53.4% › 36 million people will move up to Classes A.1% 13. Brazil.808 1.1% 2003 2004 2005 2006 2007 2008 2009 Class AB Class C Class D Class E Class AB C Income (R$) More than 4.115 – 4.7% 16.0% 42..4% 11.