News

Nestlé reports 2.8% organic growth

25 Apr 2018

Nestlé has reported three-month sales for 2018, with organic growth of 2.8% comprising 2.6% real internal growth (RIG) and pricing of 0.2%. Total sales increased by 1.4% on a reported basis.

Nestlé has reported three-month sales for 2018, with organic growth of 2.8% comprising 2.6% real internal growth (RIG) and pricing of 0.2%. Total sales increased by 1.4% on a reported basis to CHF 21.3 billion (3M-2017: CHF 21.0 billion). Net acquisitions had a positive impact of 0.2% and foreign exchange reduced sales by 1.6%. The company said its portfolio management strategy is on track. The acquisition of Atrium Innovations was completed at the beginning of March and the sale of the U.S. confectionery business completed at the end of March. Agreements were reached to acquire Terrafertil and to divest the waters business in Brazil. Full-year guidance for 2018 was confirmed.

"We are pleased to report a solid start to the year, with all regions contributing to our growth,” said Mark Schneider, Nestlé CEO. “Our volume growth improved noticeably while pricing remained soft. We are encouraged by our innovation pipeline, continued progress with the implementation of our portfolio management strategy and our efficiency initiatives. Combined with the organic sales development, they put us on track for our 2018 guidance and our 2020 mid-term targets."

“Organic growth reached 2.8%, and was within our guided range for 2018. Excluding the U.S.confectionery business, organic growth was 2.9%. RIG accelerated to 2.6% and continued to be at the high end of the food and beverage industry. Pricing was 0.2%, largely reflecting lower levels of inflation in emerging markets. Net acquisitions increased sales by 0.2% as the acquisition of Atrium Innovations was completed at the beginning of March. Foreign exchange had a negative impact of 1.6%. Total sales increased by 1.4% on a reported basis to CHF 21.3 billion. All categories had positive growth, led by petcare, coffee and Nestlé Health Science.”

“We confirm our full-year guidance for 2018. We expect organic sales growth between 2% and 4%, and underlying trading operating margin improvement in line with our 2020 target. Restructuring costs1 are expected at around CHF 700 million. Underlying earnings per share in constant currency and capital efficiency are expected to increase.”