Nestle overcomes bitter Maggi ban effect, clocks tasty results
Hit by the Maggi ban, Nestle India on Friday reported a 43.87 per cent decline in profit to Rs 183.19 crore for the fourth quarter ended December 31, 2015. The company, which follows a January-December financial year, had posted a net profit of Rs 326.38 crore during the October-December quarter of 2014-15. Net sales of the company during the quarter under review rose to Rs 1,946.44 crore, down 22.64 per cent compared to Rs 2,516.1 crore in the same period of previous year, Nestle said in a BSE filing. For the year ended December 2015, Nestle India’s net profit stood at Rs 563.27 crore and net sales at Rs 8,123.27 crore.
Nestle India Chairman and Managing Director Suresh Narayanan said, “My team and I at Nestlé India are glad to report an improvement in the sequential performance of the company both in terms of Sales and Margins. I am also happy to report that despite the exceptional toll that the MAGGI Noodles crisis took on our financials, our optimism about the future helps us with a healthy Dividend payout.
“The high point of the quarter has been the return of MAGGI Noodles to the market and the consumers to whom it rightfully belongs. The sales evolution and reception in the marketplace gives us satisfaction, but we have ambitions ahead to strengthen the brand,” added Narayanan.
“Following the re-introduction of MAGGI Masala variant, we just launched on Thursday another favourite, MAGGI Chicken Noodles. As a Team we are committed to serving our consumers with more offerings from MAGGI and our other brands by accelerating the pace of innovation and renovation,” he emphasized.
“2015 has been a very tough year for Nestlé India where the impact of the MAGGI crisis extended to not just our factories and employees but also hundreds and thousands of our partners, suppliers, farmers, retailers and customers across the country whose livelihoods depended on the company. I take this opportunity to express my sincere gratitude for their support to the company in its toughest hours, facing business hardships and difficulties but never compromising on the bonds of relationships built with us over years and decade,” the Nestle India CMD pointed out. ”In tough times, the strength and durability of relationships are tested to the extreme and I am proud of each one of them who had faith and Trust in Nestlé and withstood the crisis,” asserted Narayanan.
The company said that it faced an unusual situation with Maggi noodles that impacted its operations during the second, third and fourth quarters. Net sales of Rs 303.4 crore have been reversed during the full year ended December 31, 2015 in relation to Maggi noodles stock being withdrawn from trade partners and market, the company said.
In a separate filing Nestle India said its board has recommended a final dividend for the year 2015 of Rs 18.50 per equity shares of Rs 10 each. In November last year, Nestle India relaunched Maggi
noodles in the Indian market, five months after it was banned by the FSSAI following a
Bombay High Court order. Shares of Nestle India closed at Rs 5,056.85 apiece at the
Bombay Stock Exchange (BSE), down 3.21 cent from the previous close.