LAHORE: Nestle Pakistan reported a 7.4% decline in net sales for the first quarter of 2025, with revenue standing at PKR 50.4 billion for the period ending March 31. The company attributed the decline primarily to subdued consumer demand, stemming from the sales tax introduced in the Finance Act 2024-25 and the high taxation on salaried individuals, who constitute a significant portion of its customer base.

Despite the dip in sales, Nestle Pakistan noted an improvement in both gross profit and operating profit margins, which it attributed to a favorable product mix and operational efficiencies within its value chain.

The results, released after a Board of Directors' meeting at the company's Head Office, reflect the ongoing economic challenges faced by the company. Management expressed a cautious outlook for the remainder of the year, citing continued pressure on consumer demand due to the sales tax imposition. The company emphasized its commitment to optimizing its value chain and delivering quality products to consumers.

Nestle Pakistan's first-quarter performance highlights the impact of fiscal policies on consumer behavior and corporate revenues in the region, as companies navigate the complexities of a changing economic landscape.