Nestle India
The entire turmoil caused by the withdrawal of Maggi Noodles from the shelves since June 2015 is but obviously showing on the second quarter performance ended 30th June, 2015. Net sales for the quarter dropped 20% (YoY) at Rs.1934 crore. Apart from falling sales, there was an exceptional charge of Rs.452 crore which was on account of loss of stocks withdrawn including incidental costs thereto and other related costs. Apart from trouble in India, exports also showed a drop of 13% impacted by lower coffee exports to Russia which was partially offset by export of milk & nutrition products to Bangladesh.
The company ended the quarter with a net loss of Rs.64 crore compared to net profit of Rs.288 crore in Q2CY15. And for the six month ended 30th June 2015, net profit came in at Rs.256 crore, down 53%. It will take while for the company to recover from this Maggi issue and even if the new batches do get cleared, the company will have to step up its advertising and marketing costs to once again rebuild the faith and trust lost in the brand. Thus this year, 2015, will in all probability end on a much somber note.