Nestlé India profit nosedives 60% on Maggi woes
Hit by the Maggi ban, Nestle India on Thursday reported a 60.1% decline in standalone profit at Rs 124.20 crore for the third quarter ended September 30.business Updated: Oct 30, 2015 01:15 IST
Nestle India Ltd said its quarterly profit dropped 60%, as the company reels from the impact of a ban on its Maggi instant noodles in the country.
The India unit of Nestle SA, the world’s largest packaged food company, posted a profit of 1.24 billion rupees for the quarter ended Sept. 30, compared with 3.11 billion rupees a year earlier. Net sales fell 32 %to 17.36 billion rupees.
The company was caught in a standoff with Indian regulators for months following a nationwide ban on its Maggi instant noodles.
The ban was imposed after local regulators reported in May that some packets of Maggi noodles contained unsafe levels of lead. Nestle had to order a recall of the product next month, which cost it about 66 million Swiss francs ($67 million).
Nestle said on Thursday that sales were hurt by about 153 million rupees during the quarter as a result of the withdrawal.
Nestle had challenged the ban enforced by an Indian food regulator in a court, which had ordered retesting of Maggi noodle samples at three separate laboratories.
Earlier this month, Nestle said in a statement it had received test results from all three labs mandated by the Bombay High Court and all 90 samples, covering six varieties, were safe to eat. The company has since started manufacturing the popular noodles again.
A spokesman at the company’s global headquarters told Reuters on Monday that Nestle planned to resume sales of Maggi noodles in India in November.