The move is in order to maintain its robust dividend policy.
The directors recommend the payment of a final dividend of N35.50 per share having earlier declared an interim dividend of N25, to bring the total dividend to N60.50. The dividend payout amounted to N47.95 billion, which is higher than the N39.212 billion profit recorded in 2020.
The proposed final dividend of N35.50 comprise N24.50 from the after tax profit for the year ended
Although Nestle reported increase in top-line, its bottom-line took a beating due to high financing cost, the high inflationary pressure, increased excise duty, value-added tax, and the coronavirus pandemic.
Net financing cost soared by 302 per cent from N938 million to N3.78 billion. The increase in finance cost was primarily due to a multi-fold increase in foreign exchange losses to N1.7 billion from N37.3 million in 19.
Consequently, profit before tax fell from N71.124 billion to N60.638 billion, while profit after tax printed at N39.212 billion, compared with N45.683 billion in 2019.
Commenting on the results, analysts at
"The operating and net margin slumped 293 bps and 242 bps, to 22.4 per cent and 13.7 per cent, respectively, in 20. The profit before tax for both the segments declined in 20.
Food segment profit slipped 15.8 per cent to N39.6 billion, while beverage segment profit edged 0.8 per cent lower to N24.8 billion in 2020," the analysts said.
Explaining, its response to the COVID-19,
"We worked alongside the
"We engaged with the
"The prices of some materials increased exponentially while access to foreign exchange for the importation of key items became more restricted. Heightened insecurity compelled some of our distributors to shut down. The closure or partial closure of key markets and the lack of patronage at the make-shift markets opened by some state governments also put pressure on the business during the period," it stated.
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