PETALING JAYA: Nestlé (Malaysia) Bhd recorded a resilient performance in its first quarter ended March 31, 2024 (Q1’24) against a backdrop of constrained consumer purchasing power and heightened competition.
For the quarter, the group recorded a turnover of RM1.78 billion, lower by 3.2% from RM1.84 billion in the previous year’s corresponding period, primarily due to a slight decline in domestic sales.
CEO Juan Aranols 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.”
Profit before tax and profit after tax for Q1’24 remained resilient at RM259.1 million and RM195.5 million respectively, with profitability as a percentage of sales slightly higher compared to Q1’23. In absolute terms, the marginal decline of 1.2% and 0.8% respectively 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.
Beyond financial resilience, Aranols said they continued to make significant strides in their environmental, social and governance (ESG) agenda, with all their 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,” he added.
While still early, he said, they can see that 2024 is shaping up 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,” Aranols said.
