Nestle Grows Nine Months Profit to N23bn, Recommends N15 Interim Dividend

MARKET NEWS

Nestle Nigeria Plc On Monday resumed the declaration of interim dividend following improvement its financial results. The company used to delight investors with dividends twice every year. However, there was no interim dividend last year due to a major fall in its profit. However, as things begin to look up for again, Nestle Nigeria yesterday announced an interim dividend of N15.00 per share for the nine months.

The company reported revenue of N185.242 billion in 2017, up by 43 per cent to N129.482 billion, while cost of sale stood at N109.362 billion, compared with N77.546 billion in the corresponding period of 2016. Gross profit rose to N75.881 billion, from N51.933 billion. Net finance cost fell 56 per cent to N8.606 billion, from N19.865 billion in 2016.

Profit before tax soared by 526 per cent from N5.504 billion in 2016 to N34.479 billion, while profit after tax grew faster by 4,638 per cent from N485 million to N22.979 billion.

Speaking on the results at the Nigerian Stock Exchange (NSE) yesterday, the Managing Director of Nestle Nigeria, Mr. Mauricio Alarcon, assured stakeholders of the determination of board and management to sustain the positive performance.

According to him, the revenue growth was supported by strong consumer and distribution-led activities as well as benefits of pricing effects of last year.

“The growth is an affirmation of the loyalty and trust that our consumers have in our brands despite pressure on disposable income and tough market conditions,” he said.

The company added that net profit for the period has increased substantially due to internal cost savings initiatives, operating efficiency and a significant reduction in the net financing costs.

“The board and management remain committed to unlocking the potential of the business supported by our strategic roadmap. The company will further increase investments behind brands and route-to-market activities while proactively managing input cost pressures,” it added.

Meanwhile, trading at the stock market resumed for the week on positive note as the Nigerian Stock Exchange (NSE) All-Share Index rose by 0.06 per cent to close at 36,484.30. Similarly, market capitalisation added N7.6 billion to close at N12.6 trillion.

Analysts at Afrinvest said the positive performance was largely driven by gains in Zenith Bank (+1.1 per cent) UBA (+2.5 per cent) and Ecobank Transnational Incorporated (+2.6 per cent).

However, activity level declined as volume and value traded fell 30.3 per cent and 39.4 to 175.0 million shares and N1.8 billion respectively.