KUALA LUMPUR: Following an earning recovery in the second half of 2020, Nestle Malaysia Bhd expects to face ongoing headwinds in 2021 as a result of the Covid-19 pandemic.
Announcing Nestle's FY20 results, CEO Juan Aranols said the group forecasts continued repercussions from the pandemic, especially in the first half of the year.
"We will continue to focus on ensuring the safety of our people, the continued supply of our products to our customers and will again help vulnerable communities through different programmes.
"We also expect a significant rebound in the prices of many key commodities that anticipate margin tensions that we will continue to do our best to manage," he said in a statement.
In line with a recovery in sales and exports in the second half of 2020, Nestle posted a net profit of RM132.49mil in the fourth quarter, a slight increase from RM131.92mil in the previous corresponding quarter.
The group's turnover also proved resilient, rising to RM1.37bil from RM1.33bil in the same quarter in 2019.
"The better quarterly results are a credit to our teams’ tireless efforts in driving growth opportunities across all brands and channels in a challenging context (especially in OOH channels) and an extremely competitive environment.
"Our brands have continued to gain consumers’ endorsement thanks to solid brand plans, exciting innovations and strong sales execution," said Aranols.
The board of directors declared a third interim dividend of 92 sen per share, which brings total dividend payout to RM2.32 per share.
For the full year, Nestle posted a net profit of RM552.71mil, from RM672.91mil in 2019 due to the impact of Covid-19 on OOH channels, Covid-19-related expenses and a one-off gain from the divestment of the Petaling Jaya factory in the comparative year.
Turnover for the year stood at RM5.41bil, down from RM5.52bil previously.
Headwinds notwithstanding, the group plans to allocate significant new fresh investment to further expand and upgrade its manufacturing facilities and creating new job opportunities in 2021.
Among the group's highlights for 2021, Nestle's plant-based meal solutions manufacturing facility, one of two across Asia, will be officially launched in April.
The group will aso continue its green and sustainability efforts in 2021 with projects such as Project RELeaf, which aims to plant three million trees from 2021 to 2023, the fight against plastic waste and the group's accelerated transition to renewable energy sources across its sites.