Nestlé Nigeria Plc has reported a net loss of N142.7 billion for the first quarter of the year.
The lost came despite 43 percent growth in revenue post by the firm during the period under review.
According to the first quarter financial results posted on the Nigerian Exchange Limited website on Tuesday, the company’s revenue rose to N183.5 billion from N128 billion in the corresponding period of 2023.
However, high cost of sales which rose by 76 percent to N134.4 billion from N76.3 billion, draining gross profit down to N49.1 billion from N51.6 billion in the same period of 2023, while operating profit stood at N20.9 billion as against N28.7 billion in similar period of 2023.
But explaining the reason for the lost, the company said, it was due to further devaluation of the Naira in between January and March 2024.
“Further devaluation of the Naira in Jan-March 2024 led to the revaluation of our foreign currency obligations which had an adverse impact on the Profit after Tax resulting in a net loss of -N142.7 billion for the quarter,” the Board stated in the notification sent to the NGX.
The board also stated that it has approved a change in the measurement of Land, Building, Plant and Machinery from the historical cost model to the revaluation model with effect from 16th of March 2024.
“Accordingly, from this quarter, the company has adopted the revaluation model for Land, Building, Plant and Machinery at fair value less accumulated depreciation and impairment losses. Going forward, the revaluation of these assets will be performed every 3 years through an independent certified valuer to ensure that the carrying amount of the assets does not differ materially from its fair value. Furthermore, the assets which are under construction i.e., Capital Work in Progress (CWIP) will also follow the revaluation model at the time of the capitalization.”
Commenting on the results, Wassim Elhusseini, the CEO/MD of Nestlé Nigeria PLC said, “Our first quarter sales reflect a positive growth momentum despite a challenging business environment. The broad-based growth across our portfolio is a testimony to the resilience, adaptability, and commitment that are embedded in our business.
“I would like to express my heartfelt appreciation to our employees, whose unwavering dedication has been instrumental in achieving these results. I also extend my appreciation to our loyal customers, business partners and shareholders for their continued support.
“Looking ahead into the rest of 2024, our focus remains on optimizing our operations to ensure the availability and accessibility of high-quality food and beverages for our loyal consumers. We will continue to invest in efforts that help build thriving communities and deliver long-term value to our stakeholders. This includes enhancing the capabilities of our people and implementing innovative marketing initiatives to drive sustainable growth and maintain our competitive edge in the market.
“With our strong foundation and commitment to delighting our consumers, I am confident in our ability to deliver long-term value to our shareholders while creating value for our communities.”
