Departure Of Asia Chief Martello Overshadows Nestlé's Sales Rise
Nestle's highly regarded Asia chief Wan Ling Martello is leaving the world's largest packaged food company, taking the shine off the faster sales growth over the last three months.
The maker of KitKat chocolate and Nescafe instant coffee said it was seeing improved momentum in North America and infant nutrition as it reported sales growth of 2.9% in the third quarter, up from 2.6 percent rate in the second quarter and in line with Reuters forecasts.
Nestlé's figures were overshadowed by the departure of Martello, its former chief financial officer, who has led a revival in the company's fastest-growing region Asia, Oceania Africa (AOA) since 2015.
The former Walmart executive has taken a keen interest in e-commerce, an area where Nestlé was weak particularly in China, and has joined the boards of online retailer Alibaba and ride hailing company Uber.
"Under her leadership, Zone AOA became the most profitable and fastest growing business within the Nestlé Group. Wan Ling Martello's passion for digital transformation and her thorough understanding of the new retail economy gave a positive impetus to the whole company," the company said.
Nestlé did not disclose where Martello, a U.S. citizen, was going, saying only she would "explore new horizons" when she leaves at the end of the year.
She will be replaced by Chris Johnson, who has been with Nestle for 35 years and is currently head of group human resources and business services.
Zone AOA was Nestlé's fastest growing region during the quarter, with organic sales up 4.4 percent -- helped by faster growth in China where infant nutrition and coffee products did well. South Asia also performed well, with strong growth in Maggi noodles, Nescafe and KitKat.
Analysts said the departure of Martello, who joined Nestle in 2011 as CFO, would be a blow for the company, which has come under pressure from New York-based hedge fund Third Point, run by investor Daniel Loeb, for a bolder and faster overhaul.
"In both of her roles as CFO and CEO of Zone AOA she has been successful and very highly regarded, and her departure leaves a hole that will be tough for Nestle to fill," said Andrew Wood at Bernstein.
During its third quarter, Nestle's sales growth accelerated in the Americas, helped by demand for petcare products and coffee and slightly higher prices. In Europe, prices were still under pressure from commodity deflation.
"We are starting to see improved momentum in North America and in our infant nutrition category globally. Our business in China continued to grow at a mid single-digit pace," Mark Schneider, Chief Executive said in a statement.
Rival Unilever reported a pick-up in third-quarter sales on Thursday, as it was able to pass on higher commodity costs to consumers. French peer Danone on Wednesday said slacker demand for baby food in China and a consumer boycott in Morocco had slowed its third-quarter sales growth.
The Swiss group confirmed its 3% growth target for this year. Its shares were up 0.4% by 0815 GMT.
Schneider, who has led Nestle since 2017, said disciplined execution and faster innovation had helped growth, and portfolio management and cost-cutting programmes had made good progress.
"(We) are particularly pleased with the early closing of the Starbucks transaction," he said without giving further details on Nestlé's plans for this licensing deal struck in May that will allow the maker of Nespresso portioned and Nescafe instant coffee to add Starbucks to its coffee portfolio.