FMCG major Nestle India's June quarter earnings missed analyst expectations as profit grew by 11.1 percent year-on-year, to Rs 486.6 crore. COVID-19 induced Lockdowns disrupted its value chain and fall in other income (down 48 percent), but was supported by lower tax cost.
Revenue from operations during the quarter increased 1.7 percent to Rs 3,050.48 crore compared to same period last year.
"Sales were adversely impacted due to the COVID-19 induced lockdown leading to production disruption across factories," said Nestle India in its BSE filing.
According to the average of estimates of analysts polled by CNBC-TV18, profit was estimated at Rs 520 crore on revenue of Rs 3,225 crore for the second quarter of calendar year.
Nestle said it delivered strong performance in the 'e-commerce' channel which grew by 122 percent this quarter and now contributed 3.6 percent to domestic sales.
Domestic sales increased by 2.6 percent YoY to Rs 2,907.74 crore, but exports fell 9.3 percent to Rs 133.71 crore in June quarter.
"The demand in all 'Out of Home' consumption channels experienced a sharp decline due to the lockdown. However, Nestle brands enjoy trust, credibility and strength as far as 'in home consumption' is concerned and this boosted sales of milk based portfolio, NESCAFÉ Classic and NESCAFÉ Sunrise, all of which performed well this quarter," company said, adding Maggi also witnessed solid growth towards the end of the quarter after initial supply constraints.
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Company follows January-December period as its financial year.
On the operating front, its earnings before interest, tax, depreciation and amortisation (EBITDA) grew by 4.9 percent year-on-year to Rs 747.6 crore and margin increased by 80 bps to 24.5 percent YoY in quarter ended June 2020, which was lower than the CNBC-TV18 poll estimates of Rs 773 crore and 24 percent respectively.