FDBusiness.com

Nestlé has reported a 2.1% increase in sales to SFr91.4 billion (€80.6 billion) for 2018 with organic growth of 3% and group RIG of 2.5%, which was at the high end of the food and beverage industry, helped by faster innovation and successful new product launches. 2018 organic growth was supported by stronger momentum in the US and China, Nestlé’s two largest markets. There was also a step up in organic growth for the infant nutrition and confectionery businesses. Petcare, coffee and Nestlé Health Science continued to make significant contributions with sustained high growth. Organic growth for the group was 1.6% in developed markets and 4.9% in emerging markets.

Nestlé’s underlying trading operating profit increased by 5.1% to SFr15.5 billion as the margin increased by 50 basis points in constant currency and on a reported basis to 17.0%. Margin expansion was supported by operational efficiencies, structural cost reductions and improved mix, which more than offset higher distribution expenses.

Mark Schneider (pictured), chief executive of Nestlé, comments: “We are pleased with our progress in 2018. All financial performance metrics improved significantly and we saw revived growth in our two largest markets, the United States and China, as well as in our infant nutrition business. Nestlé keeps investing in future growth and – at the same time – has increased the amount of cash returned to shareholders through our dividend and share buyback program.”

“We made significant progress with our portfolio transformation and sharpened our group’s strategic focus, strengthening key growth categories and geographies in the process. Our unique Nutrition, Health & Wellness strategy, with food, beverage and nutritional health products at its core, has become much clearer as we completed a sizeable number of transactions and announced strategic reviews for Nestlé Skin Health and Herta.”

He adds: “We are on our way to meeting our 2020 targets and positioning Nestlé for sustained and sustainable growth in the years beyond.”