Nestlé Nigeria Plc’s net loss surged by 107% to N164.595 billion in 2024, despite a 75% increase in revenue to N958.814 billion. Rising costs of sales and finance charges contributed to the loss. However, the company showed a positive turnaround in Q4 2024, achieving a net profit of N19.7 billion and factoring in substantial investments and social responsibility initiatives.
Nestlé Nigeria Plc has reported a significant increase in net loss for 2024, rising by 107% year-on-year to N164.595 billion, up from N79.473 billion in 2023. This worsening loss is attributed to persistent challenges in the consumer sector, despite receiving considerable tax credits. The financial results highlight a robust revenue growth of 75%, amounting to N958.814 billion, yet escalating costs of sales grew even faster, constraining profit margins amidst Nigeria’s severe inflationary pressures.
The costs of sales saw a staggering increase of 97.74%, reaching N652.459 billion in 2024 from N329.945 billion in the previous year. These results reflect ongoing strain within the Nigerian business environment, marked by elevated borrowing rates and rising inflation exacerbated by a weakening local currency. Additionally, net finance costs for the company rose dramatically due to higher borrowing expenses, with finance costs rising to N392.832 billion from N233.503 billion.
Nestlé Nigeria recorded a loss before tax of N221.588 billion in 2024, representing a substantial increase of 113% compared to the N104.025 billion loss before tax reported in 2023. Addressing these findings, Mr. Wassim Elhusseini, CEO of Nestlé Nigeria Plc, remarked on the resilience of the company’s brands and operational teams amidst challenging circumstances, highlighting the substantial revenue growth and operational performance.
The fourth quarter of 2024 marked a notable return to profitability for Nestlé Nigeria, achieving a net profit of N19.7 billion, a turnaround from a loss of N36.4 billion in Q4 2023. The operating profit during this quarter surged by 77.1%, indicating strong underlying fundamentals and growth strategies. The company has invested N132 billion in operational enhancements since 2023, including N72 billion in 2024, while also expanding its workforce by 8%.
In March 2024, Nestlé Nigeria transitioned to a revaluation model for its assets, resulting in a net gain of N150 billion recognized in various financial statements. The company has balanced its performance with social responsibility initiatives, focusing on development programs for women and youth. These efforts underscore Nestlé Nigeria’s commitment to creating shared value and positively impacting the community.
In summary, Nestlé Nigeria’s significant net loss in 2024 illustrates the ongoing challenges faced in a difficult economic climate. Nevertheless, the company’s impressive revenue growth and operational turnaround in Q4 reflect resilience and strategic investments aimed at enhancing market position. Continued commitment to social responsibility initiatives further demonstrates Nestlé Nigeria’s effort to contribute positively to society while navigating financial pressures.
Original Source: dmarketforces.com
