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Nestle India, on Tuesday, reported a 7.14% drop in net profit at Rs 259.16 crore duringthe quarter ended 31 March, 2014, as compared with Rs 279.09 crore reported during the corresponding quarter last fiscal year.
Operating marginswere adversely impacted by high price of milk solids and increased demandgenerating spends on the base of a stronger quarter last year, Nestle India said in astatement.
The company's net income, which includes its net sales and other operating income, for thequarter under review increased by 2.9% to Rs 2,321.51 crore, while netsales also grew 2.9% to Rs 2,313.46 crore during January-March 2014 quarter as compared with Rs 2,248.08 crore.
Nestle India's net sales from domestic market grew by 3.4% to Rs 2,167.29 crore, while netsales from exports declined by 4.4% at Rs 146.17 crore during thequarter under review.
Exports declined mainly due to exports to affiliates, mainly Russia, as thecompany prioritised its capacity for domestic business, Nestle India said in astatement to the Bombay Stock Exchange (BSE).
"The firstquarter results are broadly as expected. We will continue to take rightdecisions in the short and medium term to ensure that we consistently movetowards our ambition of being recognised as the leader of nutrition, health andwellness in India while maintaining healthy overall performance," said EtlenneBenet, Managing Director, Nestle India.
The company saidthat tax expenses during the quarter was not fully comparable with thecorresponding quarter as in the same quarter last year the net deferred taxliabilities were revealed consequent to the change in income tax surcharge from 5% to 10%.
Its tax expenses during the quarter came down to Rs 137.38 crore as against Rs 151.15 crore during the same quarter last year. Nestle India Board of Directors has declared an interim dividend for 2014 of Rs 12.50 perequity share of Rs 10 each, amounting to Rs 120.52 crore which the company willpay on and from 29 May, 2014.
Nestle employs about 7,000 people in the country andits products are sold in about 40 lakh outlets across India.Nestle Indiashares last traded 0.56% higher at Rs 4851.35 per share on BSE on Tuesday.
