Nestle Nigeria Plc has been consistent in its performance in the past years. The company has achieved appreciable performance in turnover, profit and return on investments in the financial year ending December 31, 2007.Akinola Ajibade reports.

For Nestle Nigeria Plc, nothing drives a business better than consistency in policy formulations, products re-engineering, profit and return on investments. The last five years, though challenging due to unfavourable economic situation in the country, have seen Nestle Nigeria excelling in the above listed areas. The company‘s profit has been consistently on the upward trend. It recorded a profit after tax of N3.8billion in 2003 and N5.4billion in 2007.The turnover grew from N24.6billion in 2003 to N44billion in 2007.Earnings per share also shows a corresponding increase in the period under review. The earnings per share rose from N7.20 in 2003 to N10.71 in 2006 .So also dividend per share fromN8.02 in 2003 to N10 in 2006.Both earnings and dividend per share however, were reduced in the financial year ending December 2007.They stood at N8.24 and N8.43 respectively. Even at that, the company and the shareholders are better for it. The company has the privilege of having one of the highest shareholders funds in the Beverages segment while the shareholders are enjoying a good dividend pay out.

Chief Olusegun Osunkeye, Chairman Nestle Nigeria underscored the results, saying they were borne out of the company’s innovations. Osunkeye while speaking at the company’s 39th Annual General Meetings (AGM) in Muson Centre, Lagos recently said that the company ‘s innovations strategy is anchored on bigger opportunities in the market.

Little wonder when the company, Osunkeye noted, is strengthening its brands by producing value added products. LACTOGEN 1 and 2; NAN 2 and the bigger format of NAN 1 that were introduced in 2007 bears it all. The new products, he said enhance the company’s competitive edge and market share.

Besides, Nestle Nigeria in order to maintain market leadership, introduced what it described as Branded Active Benefits (BABS).These he said, are psychologically active food components that are incorporated into products to provide consumers with complimentary health benefits.

In the same way, the company relaunched Nestle Milo food drink with Actigen. The Actigen-E ensures full release of energy derived from food intake for an active life and mental well being. All these marketing activities have positioned the Nestle brands for good performance.

Osunkeye puts it thus; "Our "Popularly Positioned Products ‘bring best quality, highly nutritious foods and beverages within the reach of millions of people in Nigeria at the base of pyramid".

While the company is introducing and developing new products, it’s not losing sight of huge cost of production. It achieved this objective through local sourcing of raw materials. The materials which he said, are directly bought from farmers seem to be the cheapest option for a company that really wants to cut down the cost of production. The development has not only increased the fortunes of farmers but has culminated in the growth of Nestle Nigeria.

According to Osunkeye, the company has recorded significant growth over the past five years, the same way its demands for local grains such as Soya bean, maize, cocoa and sorghum has increased.

One interesting aspect in the company’s business plans is that it has continued to give business expansion, a priority by exploring new opportunities. The company has decided to build another manufacturing complex in Ogun state next year.

With this development, Nestle would comfortably increase its market share and further asserts its influence in the Beverages and Foods segment.

In the area of corporate social responsibility (CSR), Nestle has sponsored a reality television series. And since the debut of the programme in 2006, viewers' response about the programme has been overwhelming. It has also opened a workshop at the Institute of Industrial Technology, Isheri, Ogun state, coupled with the donation of N2million to the institute to further support the upgrade of equipment in the institute.

Speaking on the company’s CSR programmes, the Nestlé Chairman said that it is based on creating shared value for society and shareholders. He defined Share Value Creation as thinking long term while at the same time delivering strong annual results. Suffice to say that the company’s plans and strategies have paid off as shareholders are enjoying two dividend payments for 2007. The board has recommended for approval a final dividend of N4.2billion or N6.45 while the interim dividend is N1.45. Altogether, shareholders are enjoying dividend of N7.90.Though, the dividend is lower compared to the past two years but the company seems not bothered as it believes that its consolidation efforts would result in increased fortune for the shareholders in the future.

On Nestlé’s shareholding structure the small unit holders have the largest percentage. Out of the 660,546 shares, they own 133,339. The small units holders fall between 1-100 and 500-1000.The largest units holders that is from 1,000,000 and above have 83,333,407. representing 12 per cent.

Nestle S.A Switzerland owns 71,182 representing 10.77. Above all, Nestlé’s stock, many market analysts argue has a very good prospects. The share price of Nestle is well over N200 is believed to be a good buy for the investors.