Nestle 2022 Profit Fell Despite Sales Rising on Higher Pricing; Sets Out Guidance

By Giulia Petroni

Nestle SA on Thursday said that net profit fell in 2022 despite sales rising on higher pricing and set out guidance for the current year.

The Swiss food-and-beverage company reported net profit of 9.3 billion Swiss francs ($10.07 billion) compared with CHF16.9 billion the previous year when it made a gain on the disposal of L'Oreal shares and as its net profit margin decreased by 960 basis points to 9.8%.

Sales increased to CHF94.42 billion in the year from CHF87.09 billion previously. Organic growth reached 8.3%, with real internal growth of 0.1%. Pricing increased as the company aimed to offset significant cost inflation, Nestle said.

Regarding the year ahead, the company said it expects organic sales growth between 6% and 8% and underlying trading operating profit margin between 17% and 17.5%. Underlying earnings per share in constant currency are expected to increase between 6% and 10%.

"We expect another year of robust organic growth, with a focus on restoring our gross margin, stepping up marketing investments and increasing free cash flow," Chief Executive Mark Schneider said. Targets for 2025 were confirmed.

Nestle said it will propose a dividend of CHF2.95 a share at the annual general meeting on April 20. This represents an increase 15 cents. The board will also propose to reduce the share capital by 80 million shares through the cancellation of shares purchased as part of the company's buyback program.

Write to Giulia Petroni at [e-mail]

(END) Dow Jones Newswires

February 16, 2023 02:02 ET (07:02 GMT)

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