Swiss food and nutrition products giant Nestlé S.A. (NSRGY.PK) announced that it has adopted IAS 19 revised (Pensions) and IFRS 11 (Joint Ventures) with effect from January 1st 2013.
As a result of adoption of IAS 19 revised, employee benefit costs recognized in the Group Income Statement increase, mainly due to the replacement of the expected return on plan assets and interest costs on the defined benefit obligation by a single net interest component. The net interest cost of pensions was presented together with the Group financing costs, while service cost continues to be included in operating expenses. As a result, restated trading operating profit and net profit are lower.
Upon the adoption of IFRS 11, the Group said that its main Joint Ventures -CPW, Galderma, DPA Chilled & Liquids, BPW- are consolidated using the equity method. This meant that the Nestlé share (50%) of their sales and other Financial Statement line items was no longer consolidated, but the Nestlé share of their net profit was included in the Income Statement line "Share of results of associates and joint ventures". As a result, sales are lower but net profit and equity remain unchanged, the company said.
Revised net profit attributable to shareholders of the parent for fiscal 2012 was 10.23 billion Swiss francs, compared to net profit of 10.61 billion francs, earlier reported.
Revised annual earnings per share were 3.20 francs, compared to previously reported earnings per share of 3.32 francs.
Revised annual trading operating profit of 15.0%, compared to trading operating profit of 15.2%, previously reported.
Revised sales for the year were 89.72 billion francs, compared to previously reported sales of 92.19 billion francs.
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