ECONOMYNEXT – Net profits at food and beverage multinational Nestlé Lanka Plc, fell 48.9 percent from a year earlier to 375.8 million rupees in the June quarter, amid a slowdown in revenue, the firm said in its interim financial report.
Earnings per share for the June quarter was 6.99 rupees. The firm’s share closed trading on Thursday at 1,340 rupees, 10 cents higher. Earnings per share for the six months to June were 17.66 rupees.
Revenue fell 6.5 per cent from a year earlier to 8.4 billion rupees in the June quarter from a year earlier and cost of sales contracted 2.4 percent to 5.7 billion rupees, leading to gross profits declining 13.9 percent to 2.8 billion rupees.
Sri Lanka’s consumer sentiment soured in the June quarter amid the Easter Sunday attacks, following a constitutional crisis in the December quarter. Most firms selling fast moving consumer goods are reporting lower profitability in the June quarter.
Nestlé’s finance costs grew 28.8 percent to 90 million rupees due to borrowings for capital expenditure and the firm stopping the capitalization of borrowing costs after it finished building a new coconut milk processing plant.
Long-term borrowings remained flat at 2 billion rupees as at end June from the start of the financial year in January, while short-term borrowings grew to 2.2 billion rupees from 1.5 billion rupees. (Colombo/Aug09/2019)