Nestle Records 44% Profit Growth, Recommends N20 Interim Dividend

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Goddy Egene

Shareholders of Nestle Nigeria Plc are to receive an interim dividend of N20 per share for the nine months ended September 30, 2018. The dividend is 33.3 per cent higher than the N15 per share the shareholders received in the corresponding period of 2017.

Directors of the company recommended the interim dividend at their board meeting held on October 29, 2018 to consider the nine months results.

According to the results, revenue rose by 9.7 per cent to N203.135 billion, from N183.242 billion in the corresponding period of 2017.

Cost of sale increased to N116.984 billion, from N109.362 billion, bringing gross profit to N86.149 billion compared with N75.881 billion in 2017. Marketing and distributive expenses jumped from N25.26 billion to N29.739 billion, while administrative expenses fell from N7.535 billion to N7.050 billion in 2018. Net finance cost recorded a major decline of 85 per cent from N8.606 billion to N1.271 billion.

Hence, profit before tax stood at N48.088 billion, up from N34.479 billion, while profit after tax increased by 44 per cent from N22.979 billion to N33.118 billion in 2018.

The company explained that the growth is the result of its disciplined execution and investments in the expansion of its route to market.

The Managing Director/CEO, Mr. Mauricio Alarcon, said: “Our marketing initiatives focused on nutrition awareness, as our consumers continue to trust us to deliver high quality, affordable, nutritious food products every day. All of this is well supported by the dedication and professionalism of our people.”

He added that to sustain “our performance, we will continue to focus on creating an environment where our people can grow to their potential while delivering their best performance. Driven by our purpose of enhancing quality of life and contributing to a healthier future, we continue to create value for all stakeholders across our value chain as we source and deliver products adapted to local preferences.”

The company paid N42.50 per share dividend for 2017 financial year. While the shareholders said the dividend was a significant jump from N10 paid the previous year, they had urged the board to consider giving them a bonus issue in the coming years.

The Chairman of Nestle Nigeria, Mr. David Ifezulike, had said that it was commendable that in such an unstable and challenging environment in 2017, the company delivered “very solid results across board, recovering from the impact of the recession in 2016.”

He explained that the dividend pay-out was in line with the company’s policy of making its shareholders the ultimate beneficiaries of business growth.