Noodles-to-chocolates maker Nestle India’s net profit rose 38 percent to Rs 424 crore in the first quarter of calendar. The company that follows Jan-Dec financial year reported 10.5 percent year-on-year rise in net sales at Rs 2,736.8 crore helped by volume growth. “Profit from operations in the percentage of sales and net profit in the percentage of sales are positively impacted as the percentages have been calculated on lower reported sales,” the company said.
After the GST came in to effect in July 2017, the new indirect tax has not been recognised as part of sales and hence is not comparable with the corresponding year-ago quarter.
Total sales and domestic sales for the quarter increased by 6.3 percent each. The growth rates were adversely impacted due to lower reported sales by the change in the structure of indirect taxes and reduction in realisations to pass on the GST benefits.
Earnings before interest, tax, depreciation, and amortisation (EBITDA) grew 35 percent to Rs 676.4 crore. The company had reported EBITDA of Rs 501.2 crore in the same quarter a year ago.
EBITDA margin stood at 24.7 percent. In the same quarter last year the margin was 20.2 percent.
Commenting on the company’s performance, Nestle India Chairman and Managing Director Suresh Narayanan said, “During the quarter the company had sustained its growth momentum, which is backed by broad volume-based growth across categories.”
“This is in line with our strategy of broad-based growth through increased penetration,” he added.
The Board of Directors has declared an interim dividend for 2018 at Rs 20 per equity share of face value Rs 10 amounting to Rs 192.83 crore, which will be paid on and from June 1, 2018.
In terms of outlook, Narayanan said, “We are committed to a healthier future, and in line with our vision to introduce products rooted in nutrition, health, and wellness, we will be adding Breakfast Cereals to our existing portfolio this year. This business complements our current portfolio by combining our expertise in food and this category globally.”
Nestle India shares closed 1.16 percent down at Rs 8,986.45 per share on the BSE.
Source: Moneycontrol News