Nestle India’s profit declines 20% in Q4

NEW DELHI: FMCG major Nestle India Ltd on Thursday reported a 20% decline in its net profit at ₹386.66 crore for the fourth quarter ended December 31, 2021, as the company faced inflationary headwinds on raw material inputs.

The company, which follows a January-December financial year, had posted a profit of ₹483.31 crore in the same period a year ago, Nestle India said in a regulatory filing. However, its revenue from operations was up 8.93% to ₹3,739.32 crore during the period under review, as against ₹3,432.58 crore in the corresponding period last fiscal, the company said.

Nestle India’s total expenses in the October-December quarter, were up 8.23% to ₹3,022.97 crore, as against ₹2,793.01 crore of the corresponding period. Nestle India’s domestic sales were up 9.17% to ₹3,559.78 crore, as against ₹3,260.70 crore during October-December of 2020.

While its exports were down 6.63% to ₹146.42 crore, as against ₹156.82 crore of the corresponding quarter.

“Domestic Sales growth is largely driven by volume & mix and is broad-based,” said Nestle in an earnings statement adding exports were lower mainly due to lower coffee exports and change in product mix.

For the year 2021, Nestle India’s net profit was up 3 per cent to ₹2,144.86 crore, as against ₹2,082.43 crore a year ago. Its revenue from operations increased to ₹14,709.41 crore in 2021, from ₹13,350.03 crore in 2020.

Commenting on the annual performance, Nestlé India Chairman and Managing Director Suresh Narayanan said: “2021 was a very challenging year.” Nestlé India witnessed “broadbased, double-digit, volume and mix led growth” despite a highly volatile economic environment, he added. Like other FMCG makers, Nestle India also faced inflationary headwinds on raw material inputs in 2021.

“We continue to witness high inflation in our key raw and packaging materials, where many are at 10-year highs. However, we remain confident of our ability and competencies and will continue to make all efforts towards cost optimisation and seeking systematic efficiencies to mitigate the impact,” it said.