FMCG firm, Nestle India, reported an 11.15% year-on-year rise in net profit at Rs 486 crore for the quarter ended June 30. This number was amassed to Rs 437 crore for the same quarter last year. There has been a double-digit rise in net profit even amid the global pandemic, yet the numbers are slightly below than what many analysts estimated. There has been a marginal increase in total revenues; from Rs 2,982.8 crore a year ago to Rs 3,041.5 crore this quarter.
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“The past three months have witnessed volatility, uncertainty and stresses that we had never imagined before nor experienced. This led to disruptions across the value chain of the company that has impacted our results, though we have built back momentum strongly as we ended the quarter,” said Suresh Narayanan, Chairman and Managing Director, Nestlé India.
Nestle India has been fast to react to the upliftment of Lockdown. Their eight factories had returned back to the pre-COVID manufacturing capabilities. Sales & distribution segment is yet to move smoothly because of the various safety measures and fears among the public. A major reason for slightly reserved numbers is due to the 9.3% decline in export sales due to the nationwide lockdown.
In the past few days, Nestle India’s competitors like Marico, HUL and Britannia has also declared their results. In comparison to Nestle’s 11% rise in net profits, Marico, HUL and Britannia have witnessed an increase in their bottom line by 23%, 7% and 117%. One thing common in these FMCG firms has been a cut in the advertisements expenses. With a higher demand in the market already, decisions of companies to save their budgets has helped them to increase their profits margin.
(Nestle India follows January-December financial year, thus declaring Q2 results)