Nestlé Côte d’Ivoire reports 52% jump in net profit for H1 2024

CÔTE D’IVOIRE – Nestlé Côte d’Ivoire, the Ivorian branch of Swiss food giant Nestlé, has reported a 52.3% increase in net profit, reaching 12.36 billion CFA francs (US$20 million) for the first half of 2024.

According to the report, the turnaround in financial performance was driven by robust local sales and rising export demands, particularly to the Sahel countries and Guinea.

This substantial rebound follows a challenging 2023 when the subsidiary faced a 20.6% drop in net profit due to volatile local sales and constrained exports amid high raw material costs.

Revenue growth for Nestlé Côte d’Ivoire has mirrored this recovery, with turnover reaching 116.44 billion CFA francs (US$192M) in 2023, a 17.13% increase from 99.4 billion CFA francs (US$164M) in 2023.

The steady demand for Nestlé products in both domestic and regional markets reflects the resilience of consumer demand, despite the strain of ongoing economic pressures in West Africa.

Nestlé Côte d’Ivoire’s operating profit rose by 37.1%, reaching 20.91 billion CFA francs (US$34.5M), a sign that strategic cost management and increased production efficiencies have begun to offset previous challenges from raw material price hikes.

The company’s ordinary activities also saw a significant improvement, growing by 43.74% to 18.12 billion CFA francs.

This impressive performance comes amid the backdrop of an uncertain global and regional economic climate. This year has seen rising food and commodity prices, influenced in part by climatic disruptions and ongoing supply chain vulnerabilities.

Nestlé Côte d’Ivoire noted some relief in costs during the second half of 2023, which continued into the first part of 2024. This upward trend in financial performance suggests the company is positioned to better navigate these challenges.

However, while the company’s recent figures are encouraging, it faces potential headwinds for the remainder of the year.

Regional instability in the Sahel and fluctuating currency rates present risks to export-driven revenue streams. Despite this, Nestlé Côte d’Ivoire remains optimistic, banking on the strong momentum generated in the first half of 2024 to sustain its growth.

Market reactions reflect a degree of cautious optimism. Nestlé Côte d’Ivoire’s stock has seen a 3.93% decline since early 2024, a lingering effect of the previous year’s lackluster performance.

However, the recent profit surge might signal a reversal in investor sentiment. Should the company sustain this trajectory into the year’s second half, the stock’s downward trend could stabilize, or even see a positive shift.

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