Profile: Sir Charlie Mayfield

John Lewis Partnership Chairman

Nestlé sees sales growth in drinks brands

Nestlé, the manufacturer of Kit Kat and Nescafé, has returned flat sales in Europe, while total sales fell 2.2% to £47.49bn over the nine months to September.

Kit Kat

The Swiss food group enjoyed the biggest organic sales growth for the period in its powdered and liquid beverages brands, which rose 9.8%. They include Nesquik, Nespresso and Nestea.

Sales for its confectionary brands also rose 4%, with Kit Kat continuing to perform well overall. Meanwhile, its petcare business, which includes brands such as Purina and Go Cat, saw an 8.8% rise in organic sales.
Its struggling bottled water business, which includes Buxton, Vittel and Pure Life, saw a 1.9% fall in sales for the period.

By region, sales growth in Europe was flat, while Great Britain was strong despite a weaker third quarter performance. By category, sales volumes in Europe were solid in soluble coffee, chilled culinary, powdered beverages and petcare.

The latest results come as Nestlé UK is understood to be reviewing its digital and DM agency arrangements. A Nestlé UK spokeswoman said the company did not comment on agencies.

Paul Bulcke, Nestlé CEO, says: “In these challenging times, we have been streamlining our structures and product portfolio and, at the same time, we continue to invest in innovative technologies and expand our R&D capabilities around the world. In addition, we have increased spending in product innovation and consumer-facing brand-support.

“All this allows me to confirm my expectation that volume-driven organic growth will further accelerate and that the EBIT margin in constant currencies will improve for the full year.”

Nestlé has also announced that it will increase its 2009 share buyback from 4bn francs to 7bn francs.

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