Nestle plans RM1b capex for 2023-2025
22 Feb 2023
Nestle (Malaysia) Bhd has planned RM1 billion in capital expenditure (capex) for a new cycle of investment for the 2023-2025 period.
Nestle told Sunbiz that the RM1 billion capex will mainly go towards upgrading its manufacturing facilities and expanding production capacity as it remains very confident in the long-term prospects of Malaysia.
CEO Juan Aranols said that moving forward in 2023, the volatile economic environment is expected to persist due to continued inflationary pressures alongside uncertainties in commodity and currency prices, with signs of a recession looming in some of the world’s major economies.
“Food commodities prices and food inflation, in particular, will remain high throughout the first half of 2023, but we expect a progressive improvement in the later part of the year,” he added.
The company registered 18.5% growth in net profit for the fourth quarter ended Dec 31, 2022 to RM132.85 million from RM112.1 million in the same period last year. Revenue for the quarter increased 12.4% to RM1.65 billion from RM1.47 billion in the same quarter of the preceding year.
The growth was supported by higher domestic and export sales, which grew by 10.6% and 18.3%, respectively, on the back of demand generation efforts and the normalisation of post-pandemic economic activities.
It said that stronger sales, multiple cost-saving initiatives and reduced Covid-19 expenses helped to mitigate the impact of higher commodity prices, unfavourable exchange rates and the impact of the prosperity tax on profit after tax.
For FY22 ended Dec 31, 2022, its net profit grew 8.7% to RM620.33 million from RM569.81 million in FY21 while revenue for the year increased 16.2% to RM6.66 billion from RM5.73 billion. This was driven by the positive growth of both domestic and export sales, which increased by 12.9% and 29.3%, respectively.
It has declared a third interim dividend of RM1.22 per share for the financial year ending Dec 31, 2022, 20 sen higher than the third interim dividend of 2021.
Source: The Sun Daily