Nestlé: good growth based on volume

According to the press release, Nestlé's pricing has reached “a historically low level owing to deflationary environments across a number of developed markets and low commodity prices”. Total sales werde CHF 43.2 bn, with a foreign exchange impact of - 2.0%. The net result of acquisitions and divestitures reduced sales growth by - 0.8%.

Organic growth was broad-based across geographies and categories: 4.7% in the Americas (AMS), 2.5% in Europe, Middle East and North Africa (EMENA), 2.3% in Asia, Oceania and sub-Saharan Africa (AOA). Real internal growth was solid and balanced: 2.8% in AMS, 2.8% in EMENA, 2.9% in AOA. Nestlé delivered continued strength in developed markets with an organic growth of 1.9%, in spite of deflationary pressures, and in emerging markets with 5.4%. Trading operating profit was CHF 6.6 bn, with a margin of 15.3%, up 30 basis points on both a reported basis and in constant currencies. Net profit was CHF 4.1 bn. The reduction of CHF 0.4 bn versus last year was due to a one-off, non-cash adjustment to deferred taxes.

Sales in the product group confectionery were CHF 3.735 bn with an organic growth of 3.1%. The trading operating margin was 10.3% (- 80 basis points).