Nestle Q1 net jumps 22.4%

CORPORATE SCORECARD

Nestle India today announced a net profit of Rs 108.45 crore for the quarter ended March 31, 2007, 22.39 per cent higher compared with Rs 88.61 crore for the quarter ended March 31, 2006. Net sales at Rs 863.08 crore have risen 27.68 per cent in the quarter compared with Rs 675.92 crore in the corresponding previous quarter.

While net domestic sales went up by 24.3 per cent on account of higher volumes as well as price increases across categories, export sales increased by 69.9 per cent. This was due to higher volumes as well as higher realisations largely on account of increase in green coffee prices.

Earnings before interest, tax and depreciation (EBITD) increased 33.6 per cent over the corresponding quarter in 2006. As a percentage of net sales, EBITD increased from 19.8 per cent to 20.7 per cent during the quarter.

The company said this was a result of a growth in sales resulting in better absorption of structural fixed costs.

Martial Rolland, chairman and managing director, Nestle India, said, "Extensive work done in innovation and renovation in the area of nutrition, health and wellness and the setting up of appropriate structures is now reflecting in our performance. While we are in a better position to accelerate our growth, the environment continues to be challenging with regard to commodity prices and white collar costs. Various initiatives have been undertaken to mitigate them."

Meanwhile, the company said it was pursuing various operation excellence initiatives to mitigate the impact of sharp increases in prices of commodities such as milk solids, green coffee and wheat flour.