Nestlé Nigeria’s 9M pre-tax profit jumps 51.5% to N193.88 billion as net finance costs fall 73%

Nestlé Nigeria Plc recorded a 51.5% increase in pre-tax profit to N193.88 billion for the nine months ended September 30, 2026, compared with N127.96 billion in the corresponding period of 2025, supported by stronger gross margins and lower net finance costs.

According to the company’s unaudited 9-month financial statements filed with the Nigerian Exchange (NGX) on Thursday, October 29, 2026, revenue increased by 10.4% to N976.53 billion from N884.54 billion.

Profit after tax rose by 42.6% to N103.37 billion from N72.48 billion, while earnings per share increased to N130.41 from N91.44.

Nestlé Net Finance Costs fall 73%

Nestlé’s pre-tax profit grew significantly faster than revenue and operating profit, supported largely by a sharp reduction in net finance costs.

• Net finance costs declined by 73.2% to N14.33 billion from N53.39 billion, while operating profit increased by 14.8% to N208.21 billion from N181.34 billion.
• Finance income increased to N37.14 billion from N1.79 billion, including N35.34 billion in net exchange gains from the translation of foreign-currency balances.
• Finance costs declined by 6.7% to N51.47 billion from N55.17 billion, further reducing the net financing burden.
• Gross profit rose by 20.2% to N392.86 billion, lifting gross margin to 40.23% from 36.95%, as cost of sales increased by only 4.7%.
• Marketing and distribution expenses rose by 32.8% to N148.39 billion, while administrative expenses increased by 7.2% to N37.24 billion.
• Direct overheads declined by 8.1% to N144.82 billion, contributing to the improvement in gross margin.

However, consumer promotional expenses increased to N60.78 billion from N37.04 billion, adding to distribution-related costs. The combined effect lifted Nestlé’s pre-tax margin to approximately 19.85% from 14.47%, while operating margin improved to 21.32% from 20.50%.

Q3 Profit After Tax jumps 76%

Nestlé recorded stronger earnings growth in the third quarter, with profit after tax increasing by 76.2% to N38.60 billion from N21.91 billion in the corresponding period of 2025.

Quarterly revenue increased by 7.4% to N325.77 billion, while operating profit rose by 31.3% to N66.85 billion from N50.90 billion.

Estimated third-quarter gross profit stood at approximately N134.35 billion, representing a gross margin of about 41.2%, compared with 33.6% a year earlier.

Food revenue for the nine-month period increased by 5.4% to N609.37 billion, while its operating result rose by 13.6% to N142.88 billion.

Beverage revenue increased by 19.9% to N367.16 billion, although the segment’s operating margin narrowed to approximately 17.8% from 18.2%.

Income tax expense increased to N90.51 billion from N55.47 billion, lifting the effective tax rate to approximately 46.7% from 43.4%.

Current tax increased to N71.35 billion from N15.82 billion, while deferred tax declined to N19.15 billion from N39.65 billion.

The company stated that the impact of the Nigeria Tax Act 2025, effective January 1, 2026, was reflected in its accounts.

In a release accompanying the results, the Managing Director and Chief Executive Officer, Wassim Elhusseini, described the results as the company’s eighth consecutive quarter of profitability since returning to profit in the fourth quarter of 2024.

Nestlé accumulated losses shrink

Nestlé’s balance sheet strengthened during the nine-month period, with accumulated losses declining to N9.40 billion from N112.78 billion at the end of December 2025.

• Shareholders’ funds consequently increased to N116.27 billion from N12.89 billion, while total assets rose by 13.8% to N962.73 billion.
• Cash and short-term deposits increased by 239.9% to N120.39 billion from N35.42 billion, while interest-bearing borrowings declined to N426.31 billion from N476.04 billion.
• Estimated net debt fell by approximately 30.6% to N305.92 billion, reflecting higher cash balances and lower borrowings.
• Operating cash flow declined by 15.2% to N210.62 billion from N248.41 billion, despite higher profit, as inventory absorbed N19.38 billion and tax payments increased.
• Capital expenditure declined to N62.53 billion from N69.54 billion, while finance costs paid fell to N59.74 billion from N140.95 billion.
• Total liabilities increased by 1.6% to N846.46 billion, reflecting higher trade payables and current tax liabilities.
• Nestlé’s share price closed at N2,750 on October 29, 2026, representing a year-to-date gain of approximately 40.5% from N1,958.

The stock had declined from its March 31 high of N3,395 and remained unchanged since October 5. Investors will be monitoring whether Nestlé can sustain its improved margins without relying on foreign exchange translation gains and whether operating cash flow recovers alongside profitability.