Nestle Nigeria increases sales by 10%

NESTLE Nigeria Plc, for the first quarter of  2018 has increased its sales by 10 per cent to settle at N67.5 billion when compared to the previous year.

According to the Q1 2018 results, Profit Before Tax, however, declined marginally by five per cent to N13.6 billion, year-on-year. This can be attributed to 89 percent decline in interest income to N281.3 million, which led to a net finance charge of N879 million compared with a net finance income of N1.1 billion in the corresponding quarter of 2017.

Notwithstanding, Profit After Tax was up by three per cent to N8.6 billion because of a relatively lower effective tax rate of 37 per cent compared with 42 per cent in Q1 2017.

Commenting on the results, Mr. Mauricio Alarcon, MD & CEO of Nestlé Nigeria Plc said, “We are pleased with the sustained growth of our Company amid the competitive environment. Sustained focus on creating value for our consumers and increased efficiency in our operations also contributed to our results. We continued to invest in our most important asset, our people, as well as in product innovation to delight consumers.”

Compared with Analysts forecasts, while Q1 sales were in line, Profit Before Tax came in behind N16 billion forecast by around 15 per cent.

“The variance was driven by negative surprises on both the gross margin and net finance expense lines. As such, we anticipate downward adjustments to consensus estimates on the back of these numbers,” Proshare analyst said.

Looking forward, the company is optimistic that current business model would keep on delivering satisfactory results to shareholders and to society in line with our Creating Shared Value principle.

“Providing high-quality and affordable nutritious food and beverages which meet the needs and preferences of our consumers will remain in focus as we work alongside partners to build thriving and resilient communities through sustainable local sourcing and product innovation,” he said.