Nestle India profit dips 1.25% in Q4
NEW DELHI: Maggi noodles maker Nestlé India Ltd on Thursday reported a 1.25 % dip in March quarter profit at ₹594.7 crore as raw material costs rose sharply. In the year ago period the company had reported profit of ₹602.25 crore. Expenses grew 13% year-on-year to ₹3,195.9 crore.
Revenue from operations stood at ₹3,980.70 crore, up 10.2% compared to the year ago period. Revenue growth was led by pricing growth in milk products, coffee and Maggi noodles. Export sales decreased by 1.3% year-on-year.
Suresh Narayanan, chairman and managing director, Nestlé India said cost of key raw and packaging materials are witnessing 10-year highs. Costs continued to surge this quarter which has impacted profit from operations. “Continued inflation is likely to be a key factor in the short to medium term. We are confident of facing this turbulence with strategies of scale, efficiencies, mix and pricing all of which we will deploy judiciously,” he said.
Growth during the quarter was also aided by volume growth in Maggi noodles, and double digit growth in chocolates and coffee.
Within categories—the company’s prepared dishes and cooking aids brands such as noodles reported a “strong growth momentum” aided by media and mega portfolio activation. Maggi Sauces and Maggi Masala-aeMagic growth was impacted by high base and gradual shift from in-home cooking to out-of-home consumption during the quarter. Meanwhile, nutrition products performed well, coupled with pricing actions. Milk products continue to face challenges from competition, the company said.
Nestle’s confectionery brand such as KitKat and Nestlé Munch registered double-digit growth.
The performance was aided by media campaigns, festive interventions, apart from consumer promotions, trade inputs and focused distribution drives, the company said. Within beverages, Nescafé Classic and Sunrise delivered double-digit growth.
The company said it witnessed sustained rural growth, complemented by strong growth in smaller town and urban agglomerates. “Our robust performance in e-commerce continued as the channel grew by 71%,” Narayanan said.