Nestle Nigeria’s second quarter (Q2) 2015 profit declined by 24.9 percent as competition in the marketplace and a weak consumer spending continues to haunt the consumer products company. The company is also beset by the insecurity in the north of the country, and higher borrowing costs, among others.

Nestlé’s profit for the period under review was N8.887bn, compared with N11.836bn from the prior year. Sales also fell to N65.92bn, from 67.2bn in the preceding year, a 1.9 percent decline.

Nestle is plagued by macro-economic factors – a higher inflation rate at 9.2 percent as of July 2015, the insurgency in the North, which has denied it market access and a higher borrowing cost, which climbed to N3.23bn, from N1bn from the previous year. Total debt reached 43.47bn, from N32.35bn the previous year, an increase of 34.37 percent.

The Chairman of the company, Mr. David Ifezulike, while addressing shareholders at the company’s 46th Annual General Meeting (AGM), said: “Our Company has delivered on its short-term commitment while continuing to strengthen the foundations of our future growth. Our success has always been based upon our determination to stay the course and look ahead to understand the environment in which we operate, to organise ourselves to seize opportunities to deliver profitable growth, now and in the future.”

He disclosed that the construction of a new ultra-modern Nestle water factory located in Abaji near Abuja had reached advanced stage and that it would be officially inaugurated during the last quarter of 2015.

Nestle Nigeria Plc manufactures and markets a range of brands such Nestle Milo, Nescafe Coffee, among others.