Economy sees Nestle warn of tough 2012
NESTLE, the world’s biggest food conglomerate, posted better-than-expected 2011 sales growth yesterday but remained cautious on its outlook.
The maker of brands such as Nescafe, Perrier, Maggi and Haagen Dazs warned that 2012 would be just as difficult as previous years due to continued economic uncertainties and volatility.
Net profits rose eight per cent to SFr9.5bn (£6.6bn) last year while underlying sales rose by 7.5 per cent, beating analyst expectations of 7.1 per cent.
However, the group reported a 4.8 per cent fall in absolute sales — slightly better than expected — to SFr83.6bn, as the rise in the safe-haven currency more than cancelled out underlying growth.
Overall, Nestle managed 3.7 per cent underlying sales growth in the tough markets of Portugal, Italy, Greece and Spain and recorded a big surge in margins in Europe as it pushed new products like Dolce Gusto coffee and Maggi spice-filled roasting bags.
The group did not give figures for its UK performance but the region reported “a strong year” despite the tough economic climate.
“UK shoppers are adapting to challenging times, they still want to provide their families with good quality food and drink, and the occasional luxury – they’re just looking for value in the way that they do it,” UK chief executive Paul Grimwood said.
The Swiss giant, which employs around 5,000 people at 23 UK sites, said it plans to invest over £500m over the next three years building manufacturing facilities.
It is also extending its product technology centre at York, where chocolate bars such as Kit Kat and Yorkie are made, and moving its headquarters to Gatwick.