From 2010 as year of opportunity, Nestlé to continue momentum in 2011

Global giant Nestlé said yesterday that 2010 turned out to be a year of opportunity in Sri Lanka and the company was on course to continue with the momentum in 2011, committing Rs. 2 billion investment out of a total of Rs. 10 billion in the medium term.

“2010 has been a year of opportunity, development and growth for Sri Lanka. Nestlé Lanka’s results are a reflection of this new era of dynamism and opportunity in the country. The company has accelerated its performance by recording double digit growth both in sales and gross profit despite strong cost pressures,” Nestlé Lanka Plc Chairman Antonio Helio Waszyk said.

Noting that the Board was pleased with the “vibrancy of the company,” the Chairman said that Nestlé Lanka ended 2010 on a positive note and achieved all internal targets for the year.  “We are starting 2011 with continued momentum,” Waszyk has said in the Chairman’s Review in Nestlé Lanka’s 2010 Annual Report released yesterday.

Nestlé Lanka in 2010 recorded a turnover growth of 10.3% to Rs. 21.4 billion whilst net profit amounted to Rs. 1.9 billion, up from Rs. 1.58 billion in 2009.

In 2010 Nestlé had contributed approximately 54% of the company’s value added, amounting to Rs. 3.9 billion to the Government as taxes/duties while over 25.7% was paid to shareholders as dividends. An interim dividend of Rs. 12 was paid in January 2011 whilst a final dividend of Rs. 22.50 has been proposed.

Being a part of Nestlé Group, which is a leader in nutrition, health and wellness operating in over 130 countries across the world, the Chairman said Nestlé Lanka wanted to continue to ensure the quality, trust and integrity of the brands and products in Sri Lanka.



“In line with Nestlé Group’s direction, nutrition, health and wellness will remain a key focus” and Nestlé Lanka’s activities in 2011 will be in line with this, he asserted.

The Chairman said that Nestlé would be investing over Rs. 2 billion in 2011 in Sri Lanka to install additional production capacities and to focus on dairy development initiatives.

“This is part of a master plan drawn up for the investment of Rs. 10 billion in Sri Lanka over the next few years. I have no doubt that this strategic investment plan will help us retain our competitive positioning and provide a firm foundation for bigger success in the future,” Waszyk said.

In 2010, Nestlé Lanka embarked on an aggressive dairy development drive in the north and east areas of the country. It opened milk chilling centres in Kilinochichi and Oddusudan, both of which were the first to be opened in those areas in 30 years.

He said Nestlé Lanka’s contribution towards the development of the local dairy industry in 2010 had been “nothing short of remarkable and a proud manifestation of its ‘Creating Shared Value’ philosophy”.

“Fully aligned with Sri Lanka’s vision of developing domestic dairy production in the coming years, we will aim to double our local fresh milk collection during this time,” he added.

With dairy development expansions in the north and east, Nestlé Lanka now collects over 100,000 litres of milk from over 15,000 farmers every day. The company has also contributed Rs. 1.49 billion to the livelihoods of dairy farmers by way of milk purchases.

Additionally 38 million coconuts were procured by the company to the amount of Rs. 721 million to produce value-added ‘Coconut Milk Powder’ which is exported to about 60 countries and also sold locally.