Nestle Nigeria in its most recently published earnings report recorded earnings of N211.347 billion representing a growth of 4.04% y/y from N203.134 billion.
Segmental analysis indicates that the Food sector continues to drive revenue by contributing N131.804 billion to revenue representing 62% of sales while the beverage sector contributed N79.546 billion to revenue representing 38%. Cost of sales came in softer to bolster gross profit to N96.312 billion representing 11.79% y/y. PBT spiked by 17.6%, consequently PAT settled at N36.841 billion representing 11.24% on the upside.
Furthermore, total equity improved by 12.52% to settle at N56.510 billion. Going further, Nestle declared an interim dividend of N25 per share subject to the approval of shareholders. This represents a dividend yield of 2.05%. Gross margin improved marginal to 45.57%, while net margins prints at 17.43%.
We maintain a HOLD recommendation on NESTLE shares.