Nestlé Beats Analysts’ Expectations With 3.9 Percent Sales Lift

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14 Apr 2016 --- Nestlé has reported a sales lift of 3.9 percent on a like-for-like basis in the first quarter, ahead of analysts’ expectation, helped by strong performances in Europe, South East Asia and Africa.

Nestlé was also helped by a recovery of its Maggi noodles business which has won back market share following a food scare, but was still impacted by “unfavorable comparatives”.

In June last year, regulators had banned the sale of Maggi in India due to concerns that Maggi contained high levels of lead – a suggestion denied by Nestlé.

 

Sales for the three months were CHF 20.9 billion ($21.6 billion) and chief executive Paul Buckle said Nestlé had gained market share in most of its markets.

 

He said: “As anticipated, the first quarter continued the positive momentum in real internal growth, with softer pricing. The strongest performances were in Europe, in South East Asia and in Africa as well as for Nescafe, Nespresso and petcare.”

 

“Our US frozen food business is progressing well. The trends seen over the last few quarters show the relevance of our investment and allow us to confirm our outlook for the year.”

 

Revenues from Nestlé’s powdered and liquid beverages rose 6.3 percent in the period, helped by marketing and advertising.

 

Nespresso maintained sold growth across all markets and continued to cement on its strong position in Europe. It was also helped by increasing consumer awareness of its VertuoLine coffee maker in the US.

 

Across Nestlé Nutrition, sales came in at CHF 2.6 billion ($2.7 billion), up 2.6 percent, helped by growth in emerging markets. Sub-Saharan Africa, Indonesia and Mexico all grew well in the period. But in the US, Nestlé’s move to new product formats hindered growth.

 

Revenues at Nestlé Waters were CHF 1.8 billion ($1.86 billion) in the period, up 5.3 percent. Key performers were premium brands Perrier, S Pellegrino, and Nestlé Pure Life.

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