Nestle advances 3.61% profit in First Quarter

Nestle reported a N8.6 billion profit this quarter compared to N8.3 billion in the prior quarter.
However, the firm confirmed that it has taken a N3.4 billion impairment loss on its new Water Factory in Abaji, Abuja. The Abaji factory was commissioned in 2016 and compliments the existing Agbara factory in Ogun State.

In its 2018 first quarter interim results, the company revealed that the expected business growth and gain of market share for the factory has not been realised and outlook for future expansion is below estimates.

Based on this it conducted a test on the viability of the factory and decided to provide for a whopping N3.4 billion impairment on the factory.
The factory costs the company about N5.6 billion to construct on a land size of about 14.6 hectares. The factory promised to create 111 new jobs and produce Nestlé Pure Life, which is regarded as the world’s largest bottled water brand.

It was also supposed to be Nestlé Waters’ second and most modern water
processing facility in Central and West Africa, complementing the existing Agbara factory in the Ogun State.
Interesting to note that the project was expected to also support future demand and growth in the northern and western regions of Nigeria.

Without N3.4 billion impairment loss, the company’s profits may have been in excess of N13 billion.

Leave a Reply

Your email address will not be published.

WP Twitter Auto Publish Powered By :