Nestlé: Nestlé Malaysia delivers resilient Q1 2024 results

PETALING JAYA, Malaysia , May 2, 2024 (press release) –

Nestlé ( Malaysia ) Berhad reported a turnover of RM1.78 billion in Q1 2024, slightly lower than the previous year, with stable Profit After Tax at RM195.5 million . The company faced challenges from consumer cautious spending and competition. Despite lower sales, profitability remained resilient due to cost management. The company focused on delivering high-quality products and launched new offerings. Progress was made in ESG initiatives, including reducing greenhouse gas emissions. Community support initiatives were also a focus, including collaborations to aid refugees. The CEO highlighted the challenging outlook for 2024 and emphasized the company's commitment to meeting Malaysian needs and driving positive societal change.

Key Highlights:

* Nestlé ( Malaysia ) Berhad launched NESTLÉ ENERCAL COMPLETE for adults' nutritional requirements

* Introduced MAGGI IN MY MUG for convenient consumption of Maggi Noodles

* The company decreased greenhouse gas emissions by 14,000 tonnes of CO2 equivalent annually with the biomass boiler launch

Original Press Release:

PETALING JAYA , April 29 -- Nestlé issued the following news release:

KEY HIGHLIGHTS

* Turnover of RM1.78 billion for Q1 2024, slightly lower than last year’s corresponding quarter, attributable mainly to timing of festive periods and prudent consumer spending amid a challenging environment.

* Profit After Tax remained resilient at RM195.5 million in Q1 2024, fundamentally stable vs the corresponding quarter of 2023.

Nestlé ( Malaysia ) Berhad recorded a resilient performance in its first quarter ended 31 March 2024 (Q1 2024), against a backdrop of constrained consumer purchasing power and heightened competition.

Review of performance: Quarter 1, 2024 vs Quarter 1, 2023

In Q1 2024, the Group recorded a turnover of RM1.78 billion , slightly lower by 3.2% from RM1.84 billion in the previous year’s corresponding quarter. This was primarily due to a slight decline in domestic sales compared to the same quarter last year.

Mr. Juan Aranols, Chief Executive Officer of Nestlé ( Malaysia ) Berhad, said, “Amidst a challenging environment where consumers remained cautious with their spending and intense competitive landscape, we continued to focus on delivering high quality products, made in Malaysia , by Malaysians, to meet Malaysians’ expectations for taste, convenience, nutrition and value. With close proximity between Chinese New Year and the start of Ramadan , our teams remained laser focused in ensuring effective commercial execution, relevant communication and operational excellence across all channels."

Innovation played again a key role in the quarter, with successful seasonal offerings such as the KIT KAT Dragon, and great tasting and convenient additions to the HARVEST GOURMET range, such as the new Puff Pastries. The quarter saw also the relaunch of NESTLÉ ENERCAL COMPLETE, a holistic nutritional solution developed to meet the nutritional requirements of adults to support their healthy aging requirements, as well as the introduction of MAGGI IN MY MUG, a new convenient option to enjoy Maggi Noodles at any time of the day with a more convenient and environmentally efficient packaging solution that has seen great early acceptance amongst Malaysians.

Profit Before Tax and Profit After Tax for Q1 2024 remained resilient at RM259.1 million and RM195.5 million respectively, with profitability as a percentage of sales slightly higher vs Q1 2023. In absolute terms, the marginal decline of 1.2% and 0.8% mostly reflects the impact of slightly lower sales, effectively offset by proactive cost management initiatives as well as better commodity costs compared to the same period in the previous year.

Mr. Aranols added, “Beyond financial resilience, we continued to make significant strides in our Environmental, Social and Governance (ESG) agenda, with all our existing programmes continuing to make progress. An important milestone was the official launch of our biomass boiler in our Chembong Factory in Negeri Sembilan, Nestlé’s largest MILO plant in the world, allowing to decrease the factory’s greenhouse gas emissions by 14,000 tonnes of CO2 equivalent annually.”

“During the quarter, we continued to care for societal needs with substantive efforts mobilised again to support specific communities, with initiatives such as providing school essentials to 2,600 primary school students across the country; or the multiple food donations funded by our different brands.  We were also very honoured to collaborate with multiple entities throughout the Holy month of Ramadan , including our support to Palestine and Syrian refugees in Malaysia , in collaboration with non-profit organisation Malaysian Humanitarian Aid and Relief (MAHAR).”

Prospects

Mr. Aranols commented, "While still early in the year, we can see that 2024 is shaping to be a rather challenging year with pressure on short term growth derived from the lingering effect of inflation and foreign exchange volatility on Malaysians’ purchasing power, as well as heightened competition. We will remain fully focused, as we have done through our 112 years of presence in the nation, to meet the needs and expectations of Malaysians, while being a responsible and proactive partner to bring positive societal change at multiple levels contributing to fulfil our mission of enhancing the quality of life and the transition to a more sustainable future for the benefit of all Malaysians.”

About Nestlé Malaysia

Nestlé is the world’s largest food and beverage manufacturer. Headquartered in Switzerland , Nestlé is present in more than 180 countries around the world, and our 270,000 employees are committed to Nestlé’s purpose of unlocking the power of food to enhance quality of life for everyone, today and for generations to come. Our performance is driven by our Nutrition, Health and Wellness strategy. Nourishing Malaysians since 1912, Nestlé has earned the trust of our consumers through our quality brands and products. We are committed to improving the lives of the communities in which we operate, whilst maintaining our Halal excellence and integrity.

[Category: Food, Specialty Retail, Packaged Foods & Meats , Financial Results]

Source: Nestlé

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