Nestlé Nigeria Plc Reports Net Loss of N79 Billion in 2023



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Nestlé Nigeria Plc faced a net loss of N79 billion in its 2023 operations, marking a stark contrast from the significant profit of nearly N49 billion recorded in 2022. The company’s audited financial report for the full year ended December 2023 revealed substantial net foreign exchange losses amounting to N195 billion, severely impacting its capital base and resulting in a N78 billion deficit in the balance sheet.

The surge in foreign exchange losses, which escalated 23 times over the year, disrupted the company’s otherwise stable growth in operating activities. Additionally, increased interest expenses on the company’s enlarged borrowings added further pressure. Finance expenses tripled to N38.4 billion, reflecting a significant rise in interest-bearing debts, which surged from N155.3 billion in 2022 to N402.3 billion by the end of 2023.

Despite maintaining stable growth in operating activities, Nestlé Nigeria experienced a setback due to the substantial foreign exchange losses, preventing improved operating results from translating into bottom-line growth. Sales revenue increased by 22.5 percent to N547.1 billion, with a corresponding rise in production costs by 13.4 percent to N329.9 billion. However, cost-saving initiatives from input expenses led to a 39.4 percent increase in gross profit to N217.2 billion.

Marketing and distribution expenses grew moderately by 28.7 percent to N73.8 billion, while administrative costs surged by 83.6 percent to N20.1 billion. These cost increases were partly offset by a net write-back of financial assets impairment, amounting to N483.2 million. Despite a boost from finance income, which grew by 19 percent to N5.7 billion, the company faced significant challenges in 2023.

Driven by FX losses, finance costs multiplied 11 times to N233.5 billion, resulting in a pre-tax loss of N104 billion at the end of the year, down from a pre-tax profit of N87.5 billion in 2022. An income tax credit of N24.6 billion helped mitigate the net loss figure to N79.5 billion for Nestlé Nigeria by the close of 2023.

Gbenga Samson
Gbenga Samson
Samson Gbenga Salau [Editorial Board Adviser] Gbenga Samuel Salau is a professional journalist with over 17 years experience in journalism, he is a graduate of Communication and Language Arts, University of Ibadan. On completion of his youth service, he joined The Guardian as a freelance journalist and was later absorbed as a staff. While in the University, he was a campus journalist reporting for the Independence Hall and Faculty of Arts Press Clubs. As a campus journalist, he won the following awards; Independence Hall Press Best News writer; University of Ibadan Union of Campus Journalists’ Best News Reporter/Writer; First Runner-up, Reuben Abati Award for Investigative Journalism; Association of Faculty of Arts Students’ Press Best Reporter; University of Ibadan Union of Campus Journalists’ Best Political Writer; Winner, Reuben Abati Award for Investigative Journalism, and University of Ibadan Union of Campus Journalists’ Best Interviewer. He served the Association of Communication and Language Arts Students, as the Public Relation Officer, the same year he was appointed the News Editor of the Association of Faculty of Arts Students Press. The following session, he was made the General Editor, and a member of the 13-man University of Ibadan Students’ Union Transition Committee. As a reporter in The Guardian, in 2014, he won the Promasidor Quill Award Best Report on Nutrition and DAME Business Reporting category. In the 2015 edition of the Promasidor Quill Award, he won the best Report on Nutrition and Brand Advocate Categories, while in 2016, he won the NMMA Print Journalist of the Year, first runner-up Golden Pen Reporter of the Year and SERAs CSR Awards. Gbenga Salau loves traveling, reading, and listening to songs with good lyrics no matter the genre.

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