Nestle sales go flat in first quarter

[ZURICH] Swiss food and drink giant on Thursday reported anaemic sales growth as Asian market strength was offset by weak consumer spending in the Americas.

First quarter sales rose 0.4 per cent to 21 billion Swiss francs (S$29 billion), slightly below analyst expectations compiled by the AWP agency of 21.3 billion francs.

But organic sales growth, which excludes exchange rate factors as well as acquisitions and spin-offs, came in better than expected at 2.3 per cent against an analysts' call of 2.1 per cent.

Unfavourable exchange rates weighed on sales growth with 0.4 points and asset sales with 1.5 points.

Nestle said it struggled in North America, where weakness in sales of confectionery and animal food offset dynamic coffee and frozen goods turnover.

Brazilian sales suffered from that country's economic weakness, while western Europe was held back by falling prices.

Asia, Oceania and sub-Saharan Africa showed overall growth in sales, with the exception of China where turnover declined.

Nestle's chairman Ulf Mark Schneider, who took the helm of the Swiss company in January, said in the company's statement that he stood by its forecasts for the full year 2017, saying organic growth should come in at between two and four per cent.

AFP