Nestlé's growth cancelled out by Swiss Franc hausse | RetailDetail

Nestlé's growth cancelled out by Swiss Franc hausse

The rising prices of raw materials continue to leave their mark on announcements by major FMCG producers. Of the latest two, Henkel was successful in charging their customers for the higher costs, while Nestlé's profits plummeted. 

Good Henkel result, but under expectations

Henkel's organic second-quarter sales rose 6.3% to 3.95 billion euro, raising the year-wide expectation to a 5% rise for 2011. Profits for the German company went up 8% to 514 million euro. The quarterly turnover was slightly lower than analysts had expected, causing CEO Kasper Rorsted to say that "with intense competition continuing, an increase in raw material prices and growing uncertainties in the markets, the economic environment will remain challenging".

Huge growth cancelled out

Nestlé's figures on the other hand were hindered severely by the Swiss Franc's exchange rate (+17% in one year compared to the euro). Net profit went down 13.7% to 4.5 billion euro (-13.7%) as prices for raw materials went up. Nestlé's organic turnover went down 5% to 39 billion euro, but the Swiss company had its largest turnover growth in years when exchange rates are ignored (+7.5%) thanks to its excellent results in Asia (+13.3%). Paul Bulcke, Nestlé's Belgian CEO, took heart from this last result and claimed to expect another 5 to 6% growth in the next months.

 

The rising prices of raw materials continue to leave their mark on announcements by major FMCG producers. Of the latest two, Henkel was successful in charging their customers for the higher costs, while Nestlé's profits plummeted. 

Good Henkel result, but under expectations

Henkel's organic second-quarter sales rose 6.3% to 3.95 billion euro, raising the year-wide expectation to a 5% rise for 2011. Profits for the German company went up 8% to 514 million euro. The quarterly turnover was slightly lower than analysts had expected, causing CEO Kasper Rorsted to say that "with intense competition continuing, an increase in raw material prices and growing uncertainties in the markets, the economic environment will remain challenging".

Huge growth cancelled out

Nestlé's figures on the other hand were hindered severely by the Swiss Franc's exchange rate (+17% in one year compared to the euro). Net profit went down 13.7% to 4.5 billion euro (-13.7%) as prices for raw materials went up. Nestlé's organic turnover went down 5% to 39 billion euro, but the Swiss company had its largest turnover growth in years when exchange rates are ignored (+7.5%) thanks to its excellent results in Asia (+13.3%). Paul Bulcke, Nestlé's Belgian CEO, took heart from this last result and claimed to expect another 5 to 6% growth in the next months.

 
Questions or comments? Please feel free to contact the editors


Walmart and Microsoft team up to beat Amazon

18/07/2018

Two major American companies join forces to try to beat the omnipresent threat of Amazon: Walmart (Amazon's biggest competitor in retail) and Microsoft (Amazon's main rival in cloud services) have signed a strategic partnership for the next five years.

Sales of PCs grows for the first time in six years

13/07/2018

For the first time in six years computer sales showed growth again: in the second quarter of 2018 they increased by 1.4%. According to research firms Gartner and IDC, the sales increase is mainly due to growth in business markets.

Retailhub Inspiration Tour: the customer journey becomes very different

09/07/2018

Thanks to Retailhub by RetailDetail, Antwerp has one more unique retail hot spot. Professionals can experience the future of retail in the Benelux' only retail inspiration platform, with 1250 sqm of innovative technology and huge trends.

Breakthrough in Karstadt-Kaufhof merger

05/07/2018

Canadian Hudson’s Bay and Austrian Sigma Holding have not reached a preliminary agreement about the merger of their respective department store chains Kaufhof and Karstadt: the Canadian company says it has only signed a letter of intent.

Alibaba CEO and Belgian PM discuss investment in Liège

04/07/2018

Alibaba founder Jack Ma has discussed a possible investment in Liège, Belgium with the country's prime minister Charles Michel. Afterwards no decisive statements were made by either party.

Toys "R" Us closes American stores amidst reboot hopes

02/07/2018

Final curtains for Toys "R" Us in the United States: all the stores have closed and 30,000 employees are laid off. Against all odds, some however still hope for a second life for the troubled chain.