Swiss food giant Nestlé has closed the first quarter of 2013 with a total of sales worth 21.9 billion Swiss francs (a bit over 18 billion euro), a rise of 5.4%. Without takeovers and fluctuations in the exchange rate, growth is only 4.3%: the lowest first quarter growth since 2009.
Sales below expectations
With those quarterly results, Nestlé remains below expectations: analysts had estimated sales of 22.5 billion francs and an organic growth of 4.7% In last year's first quarter, Nestlé’s sales grew by 7.2%.
“The beginning of the year reflects the cautiousness we showed in February”, says Paul Bulcke of Nestlé Belgium, while still confirming current predictions for the entire year. This means Nestlé is still aiming for an organic growth of 5 to 6% this year.
Once more “Europe in crisis”
Just like competitor Danone earlier this week,Nestlé points to the crisis in Europe, making the consumer spend less and cut corners where possible.
While the American market grew by 5.1% and the region Asia-Oceania-Africa even by 6.1%, the old continent only managed to scrape one percent extra together. Nestlé adds that the Benelux did have a good start, as opposed to France and Germany, who are only now starting to gain momentum.
“We also see progress in our North American activities and are expecting a stronger dynamic in the most important growth markets”, they say at the headquarters in Vevey. The reference to growth markets is no coincidence: last quarter they had a growth of 8.4%, while Nestlé only grew 0.9% in the more “mature” markets.
Nutrition biggest grower
Nestlé Nutrition was the strongest branch of the company with a rise of 7.6% to 2.5 billion francs (about two billion euro). Nestlé Waters made the smallest progress: only 1.8% to 1.6 billion francs (circa 1.3 billion euro).
The other activities had a growth of 4.2% to 2.9 billion francs (about 2.39 billion euro). Nespresso was the biggest contributor, because of a “broader geographic foot print”.