Nestle India results: Net profit rises 4.4% to Rs 655.6 cr in Dec quarter
Packaged foods major Nestle India reported a 4.4 per cent rise in net profit to Rs 656 crore in the fourth quarter ended 31 December 2023, on the back of consistent performance by all key brands, particularly Nescafe.
The company had reported a net profit of Rs 628 crore in the year-ago period.
“This quarter, strong demand for Nescafe classic and Nescafe sunrise propelled the beverages product group to be our largest contributor to growth. Our beverages business witnessed double-digit growth, and Nescafe gained significant market share. The milk and nutrition product group posted double-digit growth,” the company said in an earnings release.
The maker of Kitkat chocolates and Maggi noodles reported an 8.3 per cent increase in net sales to Rs 4,584 crore from Rs 4,233 crore in the year-ago period. Its profit before interest, depreciation, and tax (PBIDT) rose 12.2 per cent to Rs 1,125 crore from the year-ago period.
“Domestic sales grew by 8.9 per cent on the back of pricing and mix growth, with strong growth momentum in e-commerce and out-of-home channels. The quarter was marked by an increase in brand investments across all product groups,” said Suresh Narayanan, Chairman and Managing Director, Nestle India.
The company’s e-commerce channel contributed to 7 per cent of the quarterly sales, while the out-of-home business reported strong growth, fuelled by portfolio transformation and premiumisation, channel prioritisation, digital lead generation, and new customer acquisition.
The fast-moving consumer goods (FMCG) major also expanded its direct coverage this quarter by adding 5,300 villages, reaching a total of over 196,000 villages, closer to its ambition of 200,000 villages.
In the year 2023, the company’s total sales crossed the Rs 19,000-crore mark, an uptick of 13.3 per cent.
In its commodity outlook, the company said that coffee prices continue to be volatile and are historically high due to limited availability. Additionally, a healthy milk flush in winters is expected to keep prices stable. “Commodities such as wheat and rice are stable as of now. Rain deficit is expected to impact the production of maize, sugar, oilseeds, and spices that may impact pricing,” it added.
The company, which followed the January-December financial year, will now follow the April-March financial year. Its current financial year has been extended by one quarter, thus ending on 31 March 2024. The company’s board also approved the declaration of the third interim dividend of Rs 7 per equity share.
First Published: Feb 07 2024 | 6:36 PM IST