Nestlé Malaysia records stable performance in first half

To Press Releases listPetaling Jaya,Aug 12, 2015

ROBUST DOMESTIC DEMANDS FUELS NESTLÉ MALAYSIA'S STEADY GROWTH
KEY HIGHLIGHTS
  • Operating Profit rose by 3.5% to RM417.6 million in the first half of 2015 compared to the corresponding period last year.
  • First half results show healthy development of the Group’s profit structure.
  • Increased marketing investments strengthened market share for brands.
  • Declared net interim dividend of RM0.65 per share.

Nestlé (Malaysia) Berhad registered an increase of 3.5% in Operating Profit to RM417.6 million for its first half ended 30 June 2015 compared to the corresponding period last year, in spite of tough market conditions. The results demonstrate healthy development in the Group’s profit structure.


Review of performance: Year-to-date, 2015 vs Year-to-date, 2014

For its first half ended 30 June 2015, the Group recorded an Operating Profit of RM417.6 million, up by 3.5% from last year’s corresponding period. Net Profit for the first six months rose by 3.2% to RM311.8 million. Meanwhile, Turnover for the period was impacted due to the lower sales in the second quarter following the GST implementation, which led to a marginal drop of 2.0% in domestic sales.

Mr Alois Hofbauer, Managing Director, Nestlé (Malaysia) Berhad, said, “Our first half results demonstrate a healthy development of our profit structure and a strengthened financial position in spite of the tough market conditions. Savings from production & raw material costs enabled us to intensify our marketing investments in the first half, which strengthened market share for our brands. This will allow us to progress on our growth path, particularly as the subdued consumer sentiment post GST-implementation neutralises in the second half.”

“One of our key marketing investments this year was the launch of our MILO Nutri G, the world’s first MILO with healthy whole grains – barley, brown rice, wheat, and oat, in a convenient bottle for breakfast on the go. Other new products launched include the Swiss-inspired LA CREMERIA sticks range, AIS KRIM GORENG Durian Flavour, a new NESCAFÉ Blend & Brew variant with zero sugar, and NESCAFÉ Mountain Wash, which highlights NESCAFÉ’s unique natural decaffeination process,” he added.

In line with the Group’s commitment to delivering shareholder value, the Board declared a net interim dividend of RM0.65 per share for the financial year ending 31 December 2015.


Review of performance: Quarter 2, 2015 vs Quarter 2, 2014

For the second quarter ended 30 June 2015, the Group registered a higher Operating Profit of RM166.7 million, a 4.0% increase compared to the corresponding period last year.

Mr Hofbauer said, “We are pleased to have delivered stronger profits for the second quarter. We had expected the second quarter to be challenging from a growth perspective due to the GST implementation. However, we remain committed towards intensifying our marketing investment in the good times as well as during challenging economic periods because we believe in Malaysia’s vast potential for middle to long term growth.”

The Group’s ongoing initiatives to drive internal and external efficiency delivered a reduction in Cost of Sales on a year-on-year comparison. These savings allowed the Group to increase its marketing investments without compromising on profitability for its shareholders. Overall, this has contributed to an increase in Profit After Tax to RM123.9 million for the quarter, a 4.6% increase year-on-year from 2014, in spite of a lower Turnover.


Prospects

Mr Hofbauer added, “We expect the year ahead to be very challenging, given the volatile global economic climate. Given the current situation, we will continue to leverage on our pool of strong Nestlé brands.”

“We firmly believe that there is a wealth of potential to be tapped in the Malaysian market and will continue to intensify our marketing activities, as well as expand our manufacturing capabilities. Our new Sri Muda factory in Shah Alam which is now in operation, is set to be a growth engine for the Group, enabling us to capitalise on new opportunities in both domestic and export markets,” he continued.

“We will continue to innovate and renovate our product portfolio to cater to evolving consumer preferences, providing Malaysians with great-tasting, high quality nutritious products, at affordable prices. Over the long term, we are committed to reinforcing our role as a leader in Nutrition, Health and Wellness, providing nutritionally balanced diets and promoting healthy lifestyles amongst Malaysians in support of the Government’s health objectives,” concluded Mr Hofbauer.




About Nestlé Malaysia

Nestlé, the world’s largest food and beverage manufacturer and a leader in Nutrition, Health and Wellness, is headquartered in Switzerland. Since 1866, Nestlé has been committed to providing high quality, tasty, safe and nutritious products to our consumers, in line with our promise of Good Food, Good Life. Nourishing Malaysians since 1912, Nestlé has earned the trust of our consumers through our quality brands and products, as well as our commitment to improve the lives of the communities in which we operate. At Nestlé, our consumers are at the heart of everything we do. We aim to delight our consumers by offering the best quality products; staying true to our Swiss roots while maintaining our Halal excellence and integrity. To learn more about how we have been nourishing Malaysians for over a century, do visit www.nestle.com.my or our Facebook page at http://www.facebook.com/NestleMalaysia



For more information, please contact:

Maxine Lim
Nestlé (Malaysia) Berhad
Tel: (+603) 7965 5185
Mobile: +6012-353 1337
Email: Maxine.Lim@my.nestle.com

Joanne Lim or Yasmin Kadir
acorn communications
Tel: (+603) 7958 8348
Mobile: +6012-353 1337 (Joanne), +6017-237 9048 (Yasmin)
Email: acorncommunications@acornco.com.my




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