The Hindu Business Line : Nestle India Q4 net down at Rs 62 cr

New Delhi March 20 FMCG major Nestle India today reported a 15.77 per cent dip in its net profit for the quarter ended December 31, 2006 at Rs 62.46 crore compared with Rs 74.16 crore for the same quarter previous year.

The company's net profit for the year ended December 31, 2006 grew marginally at Rs 315.1 crore against Rs 309.57 crore in the previous fiscal, the company said in a statement.

Nestle India said its net profit for the quarter and the full year was adversely impacted by a provision of Rs 10.1 crore under `provisions for contingencies'.

"The growth in net profit could have been higher but was adversely impacted by steep increase in prices of commodities; higher operating costs associated with upgraded formulations and manufacturing processes of the infant nutrition products to further enhance their quality; as well as increase in structural costs to better prepare the organisation to seize opportunities for accelerated growth. Increases in selling prices, higher volumes and the one-off write back have partially offset the cost increases," the statement added.

The company also declared a final dividend of 255 per cent for 2006.

Net sales during the quarter ended December 31, 2006 stood at Rs 736.29 crore compared with Rs 622.79 crore in the year ago quarter, up 18.22 per cent quarter on quarter, it said.

Net sales

Meanwhile, net sales for the twelve-month period ended December 31, 2006, were up 13.7 per cent at Rs 2,816.1 crore as against Rs 2,476.9 crore the previous year, the statement said.

"Structural changes we had initiated earlier are now allowing us to benefit from the rapidly changing consumer and economic environment. We will maintain strong focus on input costs where inflationary pressures are likely to continue,'' Nestle India Chairman and Managing Director, Mr Martial Rolland, said in the statement.

Exports in the year grew 7.9 per cent at Rs 279.6 crore.

The company said its exports were adversely impacted by lower sales of beverages to Russia and Japan, though these were offset by improved sales in other product categories and geographies.