FMCG giant Nestle India posted its results on April 21, 2022, for the quarter ended March 31, 2022. The company reported a 53.8% QoQ increase in its PAT which came in at Rs 594.7 crore against Rs 386.6 crore in the previous quarter. On a YoY basis, the PAT dipped by 1.24% to Rs 594.7 crore from Rs 602.2 crore in the year-ago period.
Nestle’s revenue from operations jumped 6.4% QoQ to Rs 3,980 crore in the quarter under review from Rs 3,739 crore in Q3 FY22. The same rose 10.2% YoY from Rs 3,610 crore in the year-ago period.
The company’s total income is up nearly 6.2% QoQ and 9.9% YoY at Rs 4,002 crore in the March 2022 quarter.
Nestle’s eCommerce sales channel grew by 71% which now contributes 6.3% to its total domestic sales. On the other hand, raw materials cost increased significantly. Nestle’s cost of materials jumped 11% QoQ and 22% YoY to Rs 1,845 crore in the quarter under review. As a result of rising input cost Nestle’s operating margins were dampened. It shrank 260 base points YoY to 23.2%.
For the short to medium term, Nestle’s outlook on commodities remains bullish. Prices of edible oil, milk, coffee, wheat, and fuel in addition to packaging and transport costs are likely to be high, both globally and locally, as per the company. Rising input costs in the short to medium term may dent profit.
Nestle has announced the payment of an interim dividend of Rs 25 per share which will be paid on May 6, 2022, along with the final dividend of Rs 65 per share.
Suresh Narayanan, Chairman and Managing Director, Nestlé India said that in the March quarter of FY22, the company has delivered double-digit domestic sales driven by volume. Key brands of the company continue to perform well with Maggi Noodles, KitKat, Nestlé Munch, Nescafé Classic and Sunrise posting double-digit growth in this quarter. Robust performance in e-commerce continued as the channel grew by 71% and contributes to 6.3% of domestic sales. The management reiterated that the company will continue to leverage e-commerce through meaningful shopper insights, data analytics, speed, and customization.