Organic Growth Did Not Meet Expectations: Nestlé CEO

By Donna Ahern
Organic Growth Did Not Meet Expectations: Nestlé CEO

Organic growth in the first half did not fully meet Nestlé's expectations, according to its 2017 half year results.

It outlined that volume growth remains at the high end of the industry but pricing continues to be soft.

The Switzerland-based company said its underlying trading operating profit margin increased by 10 basis points in constant currency and is stable at 15.8% on a reported basis.

Mark Schneider, CEO, Nestlé said:"Profitability is in line with our expectations, as restructuring savings and efficiencies have offset higher commodity costs. We are accelerating our margin improvement initiatives."

It also showed that its 2017 full-year guidance confirmed with organic growth likely to be in the lower half of the 2-4% range; stable trading operating profit margin in constant currency as a result of considerable increase in restructuring costs; underlying earnings per share in constant currency and capital efficiency expected to increase.

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According to Schneider, "We confirm our 2017 guidance with organic growth likely to be in the lower half of the 2-4% range. Our 2020 mid-range expectations for organic growth remain unchanged.”

Looking forward it outlined that its full-year guidance confirmed with organic growth likely to be in the lower half of the 2-4% range. In order to drive future profitability, it is increasing restructuring costs considerably.

© 2017 - Checkout Magazine by Donna Ahern

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