Nestle Pakistan’s EPS surges by 39% to Rs98 in 1QCY22

April 21, 2022 (MLN): Nestle Pakistan Limited has unveiled its financial results for the first quarter ended March 31, 2022, whereby it declared net profits of Rs4.45 billion (EPS: Rs98.2), 39% higher than net profits of Rs3.21bn (EPS: Rs70.77) recorded in the corresponding period last year.

This improved earnings are the result of healthy gross margins.

As per the results, the revenue for the three-month period stood at Rs37.8bn, reflecting a growth of 16.8% compared to the same period of last year due to further relaxation of COVID-19 related restrictions and normalization of economic activities coupled with portfolio and pricing management.

Meanwhile, the operating profit for the period has improved due to a favorable product mix, tighter control of fixed costs and better absorption of overheads.

Further, the company reported a 26% YoY increase in finance costs that clocked in at Rs598mn in 1QCY22.

On the tax front, the effective tax rate remained the same at 29% in 1HCY22.

Future Outlook

While the economy is showing signs of recovery and the risks from the pandemic is gradually waning, a continuous rise in commodity and energy prices have resulted in a significant increase in input costs.
The situation has been further aggravated by the recent devaluation of the currency. The management of the company is fully cognizant of the situation and taking all necessary measures to manage these
challenges and will continue to delight consumers with quality products and remains cautiously optimistic about the future, the official document of the company revealed.

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