The FMCG major's net profit fell 20% to Rs 386.66 crore on 8.45% increase in net sales to Rs 3,706.20 crore in Q4 December 2021 over Q4 December 2020.
The company's profit before exceptional items and tax rose 10.97% to Rs 743.68 crore in Q4 December 2021 over Q4 December 2020.The company reported an exceptional expense of Rs 236.50 crore in Q4 December 2021. Effective 1 December 2021, the defined benefit pension scheme for certain category of employees is amended and replaced by 'Future Ready Plan' which is a combination of amended defined benefit pension scheme for past period of service and a defined contribution scheme for future service.
Exceptional item comprises of the past service cost and the defined benefit obligation under the old plan as on 1 December 2021; settlement cost and the purchase price as charged by the insurance company to service the future annuities and incidental expenses incurred for the above projects.
The company's total expenses rose 8.23% year-on-year to Rs 3022.97 crore in Q4 December 2021. Cost of raw material consumed increased 11.72% to Rs 1,662.89 crore.
Total sales and domestic sales for the quarter increased by 8.4% and 9.2% respectively. Domestic sales growth is broad based and largely driven by volume & mix. Export sales were lower by 6.6% largely due to change in product mix.
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The company said year 2021 witnessed broad based, double digit, volume & mix led growth, despite challenging and highly volatile economic environment. Creditable urban and rural growth was witnessed in the portfolio.
For the full year, Nestle India's net profit rose 3% to Rs 2,144.86 crore on 10.11% increase in net sales to Rs 14633.72 crore in the year ended 31 December 2021.
Total sales and domestic sales for the year increased by 10.1% and 10.7% respectively. Domestic sales growth is largely driven by volume & mix and is broad based. Export sales were lower by 1.2% mainly due to lower coffee exports and change in product mix.
The board has recommended a final dividend for 2021 of Rs 65 per equity share.
Suresh Narayanan, chairman and managing director, NestlIndia said, "NestlIndia witnessed broad based, double digit, volume and mix led growth, despite a highly volatile economic environment.
Strong growth momentum continued in MAGGI Noodles aided by increased availability. KITKAT and MUNCH registered stellar growth throughout the year. NESCAFClassic continued to deliver double digit growth. Growth in e-commerce was fuelled by new emerging formats such as 'Quick Commerce' and 'Click & Mortar'. We have progressed firmly and resolutely on our RURBAN journey and this has borne fruit with strong rural growth performance in addition to sustained growth in smaller town classes and urban agglomerates.
We continue to witness high inflation in our key raw and packaging materials, where many are at 10-year highs. However, we remain confident of our ability and competencies and will continue to make all efforts towards cost optimization and seeking systematic efficiencies to mitigate the impact.
Leveraging granular growth opportunities using the power of data and analytics is a core ambition of our business strategy. We have harnessed this by building a multi-intelligent data analytics system that sources internal and external data to converge on insights that triggers swift and decisive business actions."
In its commodity outlook, the company said price outlook for key categories like edible oils, coffee, wheat, fuel remains firm to bullish while costs of packaging materials continue to increase amid supply constraints, rising fuel and transportation costs. Input prices are expected to be on bullish trend both globally and to some extent locally. Fresh milk prices are expected to remain firm with continued increase in demand and rise in feed costs to farmers. In an environment of raw and packaging material inflation, we continue to keenly look for opportunities for cost optimization and efficiencies.
NestlIndia manufactures internationally famous brand names such as Nescaf Maggi, Milkybar, Kit Kat, Bar-One, Milkmaid And Nestea and in recent years the company has also introduced products of daily consumption and use such as NestlMilk, NestlSlim Milk, NestlDahi And NestlJeera Raita.
Shares of NestlIndia were down 0.24% at Rs 18,200.45 on the BSE.
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