For decades, the sometimes-overwhelming aroma of The Body Shop’s satsuma soaps and coconut body butters have wafted through mall concourses, as much a staple to the culture as the food court.
The U.K.-based beauty and cosmetics shop has more than 3,000 retail locations in 70 countries, including 110 standalone shops in Canada. In the 1990s and early 2000s, the store practically took on cult status with teenagers and young adults who sought out naturally-based ingredients and swore by its tea tree oil line.
But just a few weeks after The Body Shop International was acquired by private equity firm Aurelius Investment, the company is reportedly appointing administrators, a move that could likely lead to job losses and store closures in the U.K. — although it’s not yet clear whether stores in Canada will be affected.
The move is fairly typical when a private equity firm takes ownership andneeds to make profit and cut losses in a very short period of time, Kai Li, a professor of finance at UBC’s Sauder School of Business and Canada Research Chair in Corporate Governance, told CBC News.
Plus, she said, the economic impacts of Brexit are starting to spill over into the U.K.’s retail market.
“This is a weak market for them, so they’re just cutting their losses,” Li said. “A very much-loved brand is now unfortunately on the chopping block.”
CBC News has reached out to Aurelius and The Body Shop for comment, but had yet to receive a response at the time of publication.
According to Sky News, which first reported on the appointment of administrators, the administration process for The Body Shop’s U.K. operations “will not impact the brand’s global franchise partners.”
Weak period of sales: report
Sky News reported that Aurelius is allegedly lining up restructuring expert FRP Advisory to manage an insolvency process. This follows a weak period of trading over the Christmas holidays and January, according to media reports.
Fans of the store have decried the news, including British actor Adjoa Andoh of Bridgerton.
Heartbroken at the demise of The Body Shop, for its body butters, make up range, ethical value system, solidarity with communities across the world who grow the ingredients. I have been shopping continuously at The Body Shop since the 1970’s. I am bereft????. Thank you Anita… <a href=”https://t.co/ho1sS7ZJwc”>pic.twitter.com/ho1sS7ZJwc</a>
“Heartbroken at the demise of The Body Shop, for its body butters, make up range, ethical value system, solidarity with communities across the world who grow the ingredients. I have been shopping continuously at The Body Shop since the 1970s. I am bereft,” the actor wrote on X, formally known as Twitter.
Other users called the store “revolutionary” for its greener, ethical approach to business. The beauty brand has campaigned for decades against animal testing in cosmetics.
British columnist Zoe Williams wrote in the Guardian Monday that she would mourn The Body Shop, which she describes as “a gateway to politics for animal-obsessed teenagers like me.”
Anita Roddick, the British businessperson, human rights activist and environmental campaigner who founded of The Body Shop, poses in front of a store on April 10, 1984. (Larry Ellis/Daily Express/Hulton Archive/Getty Images)
The Body Shop was founded in 1976 in Brighton, England, by Dame Anita Roddick. It focused on offering naturally-inspired skin care, body care, hair care and make-up that was ethically and sustainably produced at a time when those practices weren’t yet mainstream.
Roddick died in 2007 at age 64.
“The pre-digital disruptor, Anita Roddick and The Body Shop were brave, instinctive and unignorable,” U.K. MP Peter Kyle wrote on X Monday.
Changing hands
The brand first expanded into Canada in 1980, and today has about 110 standalone stores. In 2004, The Body Shop Canada sold itself to its U.K. parent company, the Body Shop International, for about $26 million.
In 2006, the company joined L’Oreal Group, then in 2017 it joined Brazilian company Natura &Co. In December, the company was acquired by Aurelius Group.
“Despite the challenging retail market there is an opportunity to re-energize the business to enable it to take advantage of positive trends in the high-growth beauty market,” Aurelius said in a November news release announcing the upcoming acquisition.
WATCH | Why ‘Sephora kids’ are taking over:
Breaking down the ‘Sephora kids’ trend
7 days ago
Duration 8:18
Social media is abuzz about the number of tweens obsessed with makeup and skin care in a trend dubbed ‘Sephora Kids.’ CBC’s Anya Zoledziowski explains how they’re getting hooked and why experts have mixed opinions on whether we should be worried about it.
A spokesperson for Natura &Co told CBC News the company was surprised to learn through the media of Aurelius’s intentions to appoint an administrator. In an email statement, the spokesperson added the company was “especially concerned by reports that certain outstanding payments owed to current and former employees of The Body Shop have not been paid by Aurelius.”
Part of the terms of the sale between the two companies included these payments through an agreed-upon reduction to the purchase price, the spokesperson said. Natura &Co sold The Body Shop for 207 million pounds, or about $351 million Cdn.
“We have sought an explanation from Aurelius for the failure to make these payments and have contacted Aurelius and its advisors on several occasions regarding these matters.”
Administration decision ‘a reality check’
Li calls Aurelius’s reported decision to appoint administrators “a reality check.”
“It also bodes badly for other Body Shop operations around the world. They might be the next, it really depends on what they can contribute to the bottom line of the new owners.”
Last year, The Body Shop brand was launched at 50 Shoppers Drug Mart stores across Canada.
The Body Shop also opened a handful of “Changemaker’s Workshop” stores in major Canadian cities to “empower Canadians to channel their inner activist” — welcoming higher traffic and sales compared to traditional stores, according to Hilary Lloyd, VP of brand & corporate social responsibility for The Body Shop North America.
Canadian beauty industry sales rose 18 per cent in 2023, according to global analytics firm Circana. The firm predicts and overall global increase will continue this year, especially for higher-end products.
TOKYO (AP) — Japanese technology group SoftBank swung back to profitability in the July-September quarter, boosted by positive results in its Vision Fund investments.
Tokyo-based SoftBank Group Corp. reported Tuesday a fiscal second quarter profit of nearly 1.18 trillion yen ($7.7 billion), compared with a 931 billion yen loss in the year-earlier period.
Quarterly sales edged up about 6% to nearly 1.77 trillion yen ($11.5 billion).
SoftBank credited income from royalties and licensing related to its holdings in Arm, a computer chip-designing company, whose business spans smartphones, data centers, networking equipment, automotive, consumer electronic devices, and AI applications.
The results were also helped by the absence of losses related to SoftBank’s investment in office-space sharing venture WeWork, which hit the previous fiscal year.
WeWork, which filed for Chapter 11 bankruptcy protection in 2023, emerged from Chapter 11 in June.
SoftBank has benefitted in recent months from rising share prices in some investment, such as U.S.-based e-commerce company Coupang, Chinese mobility provider DiDi Global and Bytedance, the Chinese developer of TikTok.
SoftBank’s financial results tend to swing wildly, partly because of its sprawling investment portfolio that includes search engine Yahoo, Chinese retailer Alibaba, and artificial intelligence company Nvidia.
SoftBank makes investments in a variety of companies that it groups together in a series of Vision Funds.
The company’s founder, Masayoshi Son, is a pioneer in technology investment in Japan. SoftBank Group does not give earnings forecasts.
Shopify Inc. executives brushed off concerns that incoming U.S. President Donald Trump will be a major detriment to many of the company’s merchants.
“There’s nothing in what we’ve heard from Trump, nor would there have been anything from (Democratic candidate) Kamala (Harris), which we think impacts the overall state of new business formation and entrepreneurship,” Shopify’s chief financial officer Jeff Hoffmeister told analysts on a call Tuesday.
“We still feel really good about all the merchants out there, all the entrepreneurs that want to start new businesses and that’s obviously not going to change with the administration.”
Hoffmeister’s comments come a week after Trump, a Republican businessman, trounced Harris in an election that will soon return him to the Oval Office.
On the campaign trail, he threatened to impose tariffs of 60 per cent on imports from China and roughly 10 per cent to 20 per cent on goods from all other countries.
If the president-elect makes good on the promise, many worry the cost of operating will soar for companies, including customers of Shopify, which sells e-commerce software to small businesses but also brands as big as Kylie Cosmetics and Victoria’s Secret.
These merchants may feel they have no choice but to pass on the increases to customers, perhaps sparking more inflation.
If Trump’s tariffs do come to fruition, Shopify’s president Harley Finkelstein pointed out China is “not a huge area” for Shopify.
However, “we can’t anticipate what every presidential administration is going to do,” he cautioned.
He likened the uncertainty facing the business community to the COVID-19 pandemic where Shopify had to help companies migrate online.
“Our job is no matter what comes the way of our merchants, we provide them with tools and service and support for them to navigate it really well,” he said.
Finkelstein was questioned about the forthcoming U.S. leadership change on a call meant to delve into Shopify’s latest earnings, which sent shares soaring 27 per cent to $158.63 shortly after Tuesday’s market open.
The Ottawa-based company, which keeps its books in U.S. dollars, reported US$828 million in net income for its third quarter, up from US$718 million in the same quarter last year, as its revenue rose 26 per cent.
Revenue for the period ended Sept. 30 totalled US$2.16 billion, up from US$1.71 billion a year earlier.
Subscription solutions revenue reached US$610 million, up from US$486 million in the same quarter last year.
Merchant solutions revenue amounted to US$1.55 billion, up from US$1.23 billion.
Shopify’s net income excluding the impact of equity investments totalled US$344 million for the quarter, up from US$173 million in the same quarter last year.
Daniel Chan, a TD Cowen analyst, said the results show Shopify has a leadership position in the e-commerce world and “a continued ability to gain market share.”
In its outlook for its fourth quarter of 2024, the company said it expects revenue to grow at a mid-to-high-twenties percentage rate on a year-over-year basis.
“Q4 guidance suggests Shopify will finish the year strong, with better-than-expected revenue growth and operating margin,” Chan pointed out in a note to investors.
This report by The Canadian Press was first published Nov. 12, 2024.
TORONTO – RioCan Real Estate Investment Trust says it has cut almost 10 per cent of its staff as it deals with a slowdown in the condo market and overall pushes for greater efficiency.
The company says the cuts, which amount to around 60 employees based on its last annual filing, will mean about $9 million in restructuring charges and should translate to about $8 million in annualized cash savings.
The job cuts come as RioCan and others scale back condo development plans as the market softens, but chief executive Jonathan Gitlin says the reductions were from a companywide efficiency effort.
RioCan says it doesn’t plan to start any new construction of mixed-use properties this year and well into 2025 as it adjusts to the shifting market demand.
The company reported a net income of $96.9 million in the third quarter, up from a loss of $73.5 million last year, as it saw a $159 million boost from a favourable change in the fair value of investment properties.
RioCan reported what it says is a record-breaking 97.8 per cent occupancy rate in the quarter including retail committed occupancy of 98.6 per cent.
This report by The Canadian Press was first published Nov. 12, 2024.
