Quantcast
Latest Stories

Nestle warns market will stay tough in 2013



Nestle CEO Paul Bulcke speaks during the 2012 full-year results press conference of Nestle in Vevey, Switzerland, Thursday, Feb. 14, 2013. Nestle SA, the world’s biggest food and drinks maker, predicted another challenging year ahead. AP PHOTO/KEYSTONE, LAURENT GILLIERON

VEVEY—Swiss-based food giant Nestle warned Thursday that business was likely to be tough this year, after its 2012 results showed a slowdown in growth in emerging markets.

Nestle’s net profit of 10.6 billion Swiss francs (8.8 billion euros, $11.5 billion), representing an increase of 11.5 percent on the 2011 performance, was slightly ahead of analysts’ forecasts.

Sales at what is the world’s top food industry player—known for products such as Nespresso coffee capsules and Maggi stock cubes—rose by 10.2 percent to hit 92.2 billion Swiss francs.

But in the Asia, Oceania and African regions, which have been Nestle’s main growth drivers, sales rose by 8.4 percent to 18.9 billion Swiss francs, down from an increase of 11.4 percent in 2011.

“In 2012 we delivered on our commitment: a good, broad-based performance building upon the profitable growth achieved consistently over previous years,” said Paul Bulcke, Nestle’s Belgian chief executive.

He cautioned that Nestle did not expect an easy ride this year.

“The environment in 2013 looks to be every bit as challenging as it was in in 2012,” he said.

British-Dutch rival Unilever recently warned of tough times, with intense competition and volatility on the raw materials market both playing a role.

Despite the relatively downbeat market outlook, Nestle stuck to its forecast for organic growth this year.

“Despite the many challenges 2013 will no doubt bring, we expect to deliver the Nestle model of organic growth between 5 percent and 6 percent as well as an improved margin and underlying earnings per share in constant currencies,” said Bulcke.

In 2012, organic growth was 5.9 percent.

The figure was 5.9 percent in the Americas, 2.4 percent in Europe and 10.3 percent in Asia, Oceania and Africa.

Price rises contributed 2.8 percent of the group’s growth.

Patrick Hasenboehler, an analyst of Bank Sarasin, said in a research note that the results were “solid” but highlighted the “only minor improvement” on emerging markets.

Jon Cox, of Kepler Capital Markets, said Nestle’s performance was “solid enough overall.”

“But emerging markets continue to decelerate and that might have spooked the markets a bit,” he told AFP.

In afternoon trading on the Swiss exchange, Nestle’s shares fell 2.56 percent to 62.85 Swiss francs.

Nestle’s board has proposed a dividend of 2.05 Swiss francs per share for 2012, up from 1.95 Swiss francs the previous year.


Follow Us


Follow us on Facebook Follow on Twitter Follow on Twitter


Recent Stories:

Complete stories on our Digital Edition newsstand for tablets, netbooks and mobile phones; 14-issue free trial. About to step out? Get breaking alerts on your mobile.phone. Text ON INQ BREAKING to 4467, for Globe, Smart and Sun subscribers in the Philippines.

Tags: Business , Earnings , food , Nestle , Retail , Switzerland



Copyright © 2014, .
To subscribe to the Philippine Daily Inquirer newspaper in the Philippines, call +63 2 896-6000 for Metro Manila and Metro Cebu or email your subscription request here.
Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:
c/o Philippine Daily Inquirer Chino Roces Avenue corner Yague and Mascardo Streets, Makati City, Metro Manila, Philippines Or fax nos. +63 2 8974793 to 94
Advertisement
Advertisement

News

  • UN heads say Syria aid needs ‘largely unanswered’
  • Captain who left doomed ferry had 40 years at sea
  • UK woman held for murder after children’s bodies found
  • Washington calls S. Sudan violence an ‘abomination’
  • Abducted soldier freed in Compostela Valley
  • Sports

  • UP nips St. Benilde; Adamson blasts RTU in Filoil women’s caging
  • Kevin Garnett responds to Raptors’ GM F word
  • Albert Pujols hits 500th HR of major league career
  • UST posts twin kill in Filoil pre-season cup opening day
  • Wizards beat Bulls in OT to take 2-0 series lead
  • Lifestyle

  • Entering the monkhood a rite of passage
  • Haneda International Airport: A destination on its own
  • Wanted: Beauty queen with a heart that beats for the environment
  • Kim Atienza: At home with art and design
  • Life lessons I want to teach my son
  • Entertainment

  • Ex-Fox exec denies allegations in sex abuse suit
  • Kris Aquino backtracks, says Herbert Bautista and her are ‘best friends’
  • Summer preview: Chris Pratt enters a new ‘Galaxy’
  • Bon Jovi helps open low-income housing in US
  • Summer movie preview: Bay reboots ‘Transformers’
  • Business

  • Toyota sells 2.58 million vehicles, outselling GM
  • McDonald’s 1Q profit slips as US sales decline
  • SEC approves SM’s P15B retail bond offer
  • $103M Vista Land bonds tendered for redemption
  • Oil slips to $102 as US crude supplies seen rising
  • Technology

  • Engineers create a world of difference
  • Bam Aquino becomes Master Splinter’s son after Wiki hack
  • Mark Caguioa lambasts Ginebra teammates on Twitter
  • Brazil passes trailblazing Internet privacy law
  • New York police Twitter campaign backfires badly
  • Opinion

  • One-dimensional diplomacy: A cost-benefit analysis of Manila’s security deal with Washington
  • No ordinary illness
  • Reforest mountains with fire trees and their kind
  • Day of the Earth
  • When will Chinese firm deliver new coaches?
  • Global Nation

  • Palace thanks Estrada for successful HK mission
  • Hong Kong accepts PH apology; sanctions also lifted
  • China won’t budge, wants PH gov’t to apologize to HK
  • Cha cha train to follow Obama visit?
  • No word yet on inking of US-PH defense pact during Obama visit
  • Marketplace