Nestlé India Ltd reported a 2.25% jump in profit to ₹483.31 crore for the December quarter over the year-ago period, the fast-moving consumer goods company told the exchanges on Tuesday. In the third quarter of FY20 it had reported profit of ₹472 crore.
However, the profit was below the ₹563.40 crore estimated by Bloomberg analysts.
Revenue from operations stood at ₹3,432.58 crore, up 9% compared to the year ago period. Expenses for the quarter were up 8.26% to ₹2,793 crore.
“Total sales and domestic sales for the quarter increased by 9.2% and 10.1%, respectively. Domestic sales growth is broad based largely driven by volume and mix. Demand in out-of-home channel further improved in the quarter, but continues to be impacted by covid. Export sales were lower by 7.7% due to lower coffee exports," the company added.
High employee costs partially negated strong gross margins, said Abneesh Roy, executive vice president, Edelweiss Securities. Employee costs were up 25% during Q3. Sales were in line with estimates, but exports disappointed, Roy added.
For the full year, revenue from operations was up 7.9% at ₹13,350 crore, while profit for the year was up by 5.7% to ₹2,082.4 crore, the maker of Nescafé coffee and Maggi noodles said. Total sales and domestic sales increased by 8.1% and 8.5%, respectively.
The company ramped up its marketing spends during the December quarter.
“Nearly two thirds of our key brands like Maggi noodles, Kitkat and Nescafé Classic posted double-digit growth last year. This was backed by a step up in marketing spends, especially in the last quarter. Our innovation and renovation pipeline continued to be a thrust area across categories like foods, breakfast cereals and Nestlé Health Sciences. E-commerce continued to surge ahead and now contributes 3.7% of the domestic sales," said Suresh Narayanan, chairman and managing director, Nestlé India.
During the quarter sales through the e-commerce route grew by 111%, contributing nearly 3.7% to overall domestic sales.
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