NESTLE's profit drops 51.6%, declares Rs25 dividend
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MG News | October 24, 2024 at 03:07 PM GMT+05:00
October 24, 2024 (MLN): Nestle Pakistan Limited (PSX: NESTLE) saw its bottom line plummet by 51.6% in the third quarter, reporting a profit of Rs2.33 billion (EPS: Rs51.32) compared to earnings of Rs4.81 billion (EPS: Rs105.96) recorded in the same period last year (SPLY).
Along with the results, the company has announced an interim cash dividend of Rs25 per share i.e.250%.
An analysis of the profit and loss account reveals that declining topline revenue and income, along with rising finance costs, led to this profit drop for NESTLE.
The company's top line shrank 16.5% to Rs41.55bn as compared to Rs49.72bn in SPLY.
The cost of sales fell by 13.9% but was higher than proportionate to sales decline, which worsened the gross profit by 21.3% to Rs13.59bn in Q3 CY24.
The gross margins worsened to 32.7% as compared to 34.7% in SPLY.
During the period under review, other income fell by 67.6% to stand at Rs114.92m in Q3 CY24 as compared to Rs354.81m in SPLY.
On the expense side, the company's administration expenses rose 11.4% YoY to Rs1.64bn.
Conversely, distribution and selling expenses fell 11.1% YoY to Rs6.71bn, while other operating expenses were down 36.1% YoY to Rs358.73m.
The company’s finance cost went up by 20.9% and stood at Rs713.14m as compared to Rs589.71m in SPLY, mainly due to higher interest rates.
On the tax front, the company paid a lower tax worth Rs1.97bn against the Rs2.65bn paid in the corresponding period of last year, depicting a decrease of 25.7%.
| Unconsolidated (un-audited) Financial Results for quarter ended September 30, 2024 (Rupees in '000) | |||
|---|---|---|---|
| Sep 24 | Sep 23 | % Change | |
| Sales | 41,545,472 | 49,723,087 | -16.45% |
| Cost of sales | (27,952,251) | (32,460,099) | -13.89% |
| Gross Profit/ (loss) | 13,593,221 | 17,262,988 | -21.26% |
| Administration expenses | (1,635,321) | (1,467,590) | 11.43% |
| Distribution and selling expenses | (6,707,086) | (7,547,672) | -11.14% |
| Other Income | 114,922 | 354,807 | -67.61% |
| Other Operating Expenses | (358,730) | (561,114) | -36.07% |
| Finance Cost | (713,144) | (589,707) | 20.93% |
| Profit/ (loss) before taxation | 4,293,862 | 7,451,712 | -42.38% |
| Final tax / levies | (1,966,559) | (2,646,413) | -25.69% |
| Net profit/ (loss) for the period | 2,327,303 | 4,805,299 | -51.57% |
| Basic earnings/ (loss) per share | 51.32 | 105.96 | - |
Amount in thousand except for EPS
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