Nestlé Lanka delivers good topline growth, profit flat in 1H

Heavy challenges faced by currency depreciation and increase in fuel, energy and other costs

Nestlé Lanka PLC, Sri Lanka’s leading nutrition, health and wellness company has recorded a good revenue growth of 13.5% (YoY) for the six months ending 30 June 2012, posting a revenue of Rs. 14.5 billion against the background of a difficult market environment.

The company announced a flat bottomline growth of -1% (YoY), with a net profit of Rs. 1,246 million due to currency depreciation and the rise in fuel, energy and other costs which resulted in a significant increase of costs for its manufacturing operations.  

 “2012 continues to be a very trying year for us. Despite the many challenges we face, we are maintaining a solid revenue growth and strengthening our leading position in our key categories,”

Nestle Lanka Managing Director Alois Hofbauer said.

“However, external impacts on the bottomline are continuing to take its toll,” he added.

Notwithstanding, Nestlé according to Hofbauer, will continue its strong commitment to Sri Lanka and its people.

“We have continued to contribute significantly to the local rural economy and registered a 35% increase in the procurement of local fresh milk.

We remain committed to ‘creating shared value’ for our local communities even during this difficult time,” Hofbauer said.

In 2011, the company’s overall contribution to the rural economy by way of fresh milk and coconut purchases was 3.6 billion, resulting in a 63% increase in fresh milk and coconut procurement from 2010.