Nestle Raises Organic-Growth Guidance After 9-Month Sales Rose -- Update

By Giulia Petroni

Nestle SA said Wednesday that sales rose in the first nine months of the year and raised its full-year guidance for organic sales growth.

The Swiss food-and-beverage giant reported sales of 63.29 billion Swiss francs ($68.60 billion) in the period, up from CHF61.91 billion in the previous year. Company-compiled consensus had forecast the figure at CHF62.93 billion.

Organic sales growth was 7.6%, with real internal growth of 6%, the company said. Pricing increased to 1.6%, accelerating to 2.1% in the third quarter.

Nestle said growth was supported by continued momentum in retail sales, a steady recovery in the out-of-home channels due to further easing of restrictions, as well as increased pricing and market-share gains.

Coffee was the largest contributor to growth in the period, boosted by the Nescafe, Nespresso and Starbucks brands. Purina PetCare and vegetarian and plant-based food recorded double-digit growth.

Nestle said sales at Nestle Health Science also grew at a double-digit rate, reflecting strong demand for vitamins and supplements, while nutrition posted negative growth due to lower birth rates worldwide and a sales decline in China.

Looking at the full year, the company said it now expects organic sales growth between 6% and 7%, from previous guidance of between 5% and 6%.

As previously announced, the underlying trading operating profit margin is expected around 17.5%, reflecting delays between input cost inflation and pricing, while underlying earnings per share at constant currency and capital efficiency are expected to increase during the year.

The mid-term outlook for continued moderate margin improvement remains unchanged.

Write to Giulia Petroni at [e-mail]

(END) Dow Jones Newswires

October 20, 2021 02:22 ET (06:22 GMT)

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