Nestle profit rises by 31 per cent

The improved performance was helped by a 35 per cent drop in interest cost from Rs 11.7 crore to Rs 7.6 crore during the quarter compared to last year.

Exports for January-March, however, nosedived by 55 per cent to Rs 47 crore from last year’s figure of over Rs 100 crore due to the continuing crisis in the Russian economy and devaluation of Brazilian currency, it said.

The drop was mainly on account of decline in exports of processed coffee "Nescafe" to Russia, the statement added. The gross revenue for the firstquarter also dropped to Rs 342 crore as against last year’s figure of Rs 374 crore.

A Nestle statement said exports of processed coffee from India were handicapped due to taxes levied on green coffee purchased to manufacture value-added instant coffee.

The company is an exporter of value-added processed coffee which has higher realisation than commodity green coffee exports. It said coffee exports are also affected due to the floor price imposed for importing tin plates, which is significantly higher than prevailing international prices, thereby making the cost of packaging Nescafe to international quality standards prohibitive.

"Both these factors are providing detrimental to Indian exports of processed coffee," it said adding that Nestle has made representations and is hopeful that the government will take appropriate measures on both counts to ensure the international competitiveness of instant coffee manufactured in India.