KARACHI: Sales and profits of food and fast-moving consumer goods (FMCG) companies have gone up substantially since 2019 despite Covid-19 and ever-increasing fuel costs, global freight charges and taxation.

The financial accounts of listed companies do not mention quantities of goods sold. As such, higher revenues may well be an outcome of frequent price hikes. Manufacturers have been reducing the per-unit quantity/weight of their goods while jacking up the prices frequently.

Sales of Unilever Pakistan Food Ltd for the calendar year 2021 soared to Rs 19.8 billion, up from Rs15.5bn in 2020. Its net profit stood at Rs5.17bn in 2021, up from Rs3.8bn a year ago. Sales in the January-March quarter climbed to Rs6.55bn from Rs5bn a year ago while net profit soared to Rs1.8bn from Rs1.45bn in the same quarter of 2021.

FrieslandCampina Engro Pakistan Ltd registered sales of Rs52bn in 2021 from the preceding year’s Rs44bn. Its net profit stood at Rs1.8bn against Rs176 million in 2020. Sales in the latest quarter surged to Rs14bn from Rs11.5bn a year ago. Quarterly profit for the period stood at Rs664m versus Rs547m in the year-ago period.

Manufacturers have frequently reduced per-unit weight while jacking up prices of their goods

Sales of Colgate Palmolive Pakistan Ltd in the year ending on June 30, 2021 stood at Rs67bn compared to Rs57.8bn in the preceding year. Its net profit surged to Rs5.6bn from Rs4.8bn over the same period.

Sales of National Foods Ltd for the nine months ending on March 31, 2022 grew to Rs33bn from Rs25.5bn in the year-ago period. Its net profit was Rs2.21bn in the latest nine months versus Rs1.56bn in the comparable period of the preceding fiscal year.

Gross sales of Ismail Industries Ltd for the nine months ending on March 31, 2022 improved to Rs49bn versus Rs35bn in the same period of 2020-21. Its net profit grew to Rs1.9bn from Rs1.5bn in the same period.

Bata Pakistan Ltd recorded a net turnover of Rs14bn in 2021, up from Rs11.7bn in 2020. Its net profit remained Rs546m, up from a loss after tax of Rs627m in 2020.

Nestle Pakistan Ltd has planned an investment of Rs3bn in 2022 to increase its operational reliability and capacity. It invested Rs2.6bn in expansion projects in 2021. The company grew its sales by 12.2pc per cent to Rs133.3bn in 2021 despite the challenges caused by the pandemic. Its net profit soared 43pc to Rs12.7bn in 2021.

Financial results of the textile sector also remained upbeat owing to local sales and exports. Net profit of Sapphire Textile Mills Ltd increased to Rs10bn in the first nine months of 2021-22 from Rs5bn reported in the comparable period of the preceding fiscal year.

Nine-month earnings of Gul Ahmed Textile Mills Ltd surged to Rs6.1bn in July-March, up from Rs3.6bn a year ago.

Pak Kuwait Investment Company Head of Research Samiullah Tariq said impressive financial results are reflective of population growth, increased awareness about branded/packaged items, rising urbanisation and a high GDP growth rate.

He said no alternative is available for food items as people cannot stop consuming them irrespective of their prices. When asked as to why companies refrain from giving any details of quantities with sales in their financial results, he said they fear that consumers would evaluate the price factor and the costs of goods sold easily. Besides, there are also competition concerns, he added.

In June, the consumer price index hit a 14-year high of 21.3pc.

Published in Dawn, July 13th, 2022