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Nestle India registers total sales worth Rs 11,216 cr for full year ’18
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Wednesday, 20 February, 2019, 08 : 00 AM [IST]
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Our Bureau, New Delhi
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Nestle India registered total sales of Rs 11,216 crore for the full year 2018. This was stated by the company’s board of directors, who met at Nestle House, Gurugram, recently to approve the company’s results.
Suresh Narayanan, chairman and managing director, Nestle India said, “We have, once again, delivered volume-led profitable growth. There has been double-digit growth in almost all the categories, supported by a step up in demand generating activities, including on new products.”
“Our iconic brands, like Maggi, Nescafe, Kitkat, Munch and Everyday, continued to deliver strong performances,” he added.
“We offered exciting new products, and in 2018, introduced Nescafe ready-to-drink cans, Nesplus, Maggi Nutri-licious Baked Noodles, Maggi Dip and Spread, Nescafe E Smart Coffee Machine and Everyday Chai Life,” Narayanan said.
Adding that 2018 was a year of milestones, he said, “We became the first listed pure play food and beverage company in India to cross Rs 10,000 crore in revenue for the full year 2017, and have now crossed Rs 11,000 crore in revenue for the year 2018.”
The company continued to receive valuable support from Nestle Group’s unmatched research and development (R&D) capabilities and expertise. Under the General License Agreements, it has ongoing access to global portfolio of thousands of brands and patents, proprietary technologies and know-how developed by the global network of 31 R&D centres (including one in India). as well as expertise across the value chain, i.e.,
in operations, commercial and support functions.
Nestle India stepped up its initiatives towards plastic waste management, especially in the hill states with the launch of 2 Minute Safaai Ke Naam. The journey is continuing, and the company remains steadfast in its commitment to manage plastic waste and follow the 3Rs principle (Reduce, Recycle and Recover).
Highlights for the full year 2018
In accordance with Ind AS 18 on Revenue and Schedule III to the Companies Act, 2013, Sales for the period between January 1 to June 30, 2017 in the previous year were reported gross of excise duty and net of value-added tax (VAT)/sales tax. Excise duty was reported as a separate expense line item.
Consequent to the introduction of Goods and Services Tax (GST) with effect from July 1, 2017, VAT/sales tax, excise duty etc. have been subsumed into GST (Goods and Services Tax). And accordingly, the same is not recognised as part of sales as per the requirements of Ind AS 18. This has resulted in lower reported sales in the current year in comparison to the sales reported in the previous year under the pre-GST structure of indirect taxes.
With the change in structure of indirect taxes, expenses are also being reported net of taxes. Accordingly, financial results for the year ended December 31, 2018, and, in particular, sales, absolute expenses and ratios in percentage of sales are not comparable with the previous year. Profit from operations in percentage of sales (21 per cent) and net profit in percentage of sales are positively impacted as the percentages have been calculated on lower reported sales.
Total sales and domestic sales for the year increased by 10.7 per cent and 10.9 per cent, respectively. These growth rates are adversely impacted due to lower reported sales by the change in structure of indirect taxes. Domestic sales growth is volume-led and broad-based. Export sales increased by 6.9 per cent.
Comparable growth was estimated to be 14.3 per cent. Net profit amounted to Rs 1,607 crore and the enabled contribution to the exchequer was Rs 3,076 crore. The net cash generated from operating activities was Rs 2,052 crore.
Profit from operations in percentage of sales and net profit in percentage of sales are positively impacted by 60 basis points (bps) and 40 bps, respectively, as the percentages have been calculated on lower reported sales.
Highlights for the quarter ended December 31, 2018
Total sales for the quarter increased by 11.2 per cent. Domestic sales increased by 12 per cent, supported by volumes, and was broad-based. Export sales remained flat due to lower exports to Bangladesh and the United Arab Emirates.
Dividend
The board of directors have recommended a final dividend of Rs 25 per equity share, amounting to Rs 2,410.4 million for the year 2018. The total dividend for 2018 aggregates to Rs 115 per equity share, which includes three interim dividends of Rs 20 per equity share paid on June 1, 2018, Rs 20 per equity share paid on August 24, 2018 and Rs 50 per equity share paid on December 21, 2018. The earnings per share (EPS) amounted to Rs 166.67.
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