Nestle Pakistan witnesses 21% higher profits in CY20

By MG News | February 25, 2021 at 03:53 PM GMT+05:00

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February 25, 2021 (MLN): Nestle Pakistan Limited has earned 21% higher profits in CY20 compared to CY19. The net profits of the company during the year recorded at Rs 8.9 billion as opposed to Rs 7.35 billion reported in 2019.

The earnings per share of the company during the year stood at Rs 195.91/sh in 2020 compared to Rs 162.17/sh in the previous year.

During the year, the company’s revenues increased merely by 2.43% YoY and reached Rs 118.78 billion. Dairy and Nutrition products are the main contributors to this growth while the overall portfolio also benefitted from selling price increases taken to off-set 1.7% YoY increase in input costs.

The gross margin of the company remained flat during the year.

With regards to the major expense head, the company’s administrative expenses jumped by 21.2% YoY however, the impact was offset by the decline in distribution expenses and other expenses by 2.73% YoY and 26.68% YoY respectively.

The finance cost of the company also declined by 12% YoY owing to lower interest rates.

The effective tax rate of the company came in at Rs 29% compared to 31% in 2019.

Financial Result for the Year ended December 31st, 2020 ('000 Rupees)
	2020	2019	% Change
Revenues from contracts with customers	118,781,274	115,962,473	2.43%
Cost of goods sold	(84,016,549)	(82,613,501)	1.70%
Gross Profits	34,764,725	33,348,972	4.25%
Distribution and selling expenses	(14,256,719)	(14,656,501)	-2.73%
Administration expenses	(4,447,506)	(3,667,718)	21.26%
Operating profits	16,060,500	15,024,753	6.89%
Finance cost	(2,805,015)	(3,187,695)	-12.00%
Other expenses	(1,019,221)	(1,390,138)	-26.68%
Other income	354,830	268,790	32.01%
Profit before taxation	12,591,094	10,715,710	17.50%
Taxation	(3,706,499)	(3,361,243)	10.27%
Profit after taxation	8,884,595	7,354,467	20.81%
Earnings per share - Basic and Diluted (Rupees)	195.91	162.17	20.81%

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