Pressure grows on Nestlé after disappointing H1 | Progresiv
Nestlé has come under further pressure to revamp its operations, after reporting disappointing figures for its fiscal first half. The results prompted the world’s largest food maker to narrow its forecast for the full year. 
For the six months to end-June, sales declined by 0.3% to 43bn Swiss francs, even as they grew by 2.3% on an organic basis, which the group admitted was “below our expectations”.
Sales in the Americas were up 2.9% (+1.3% organic growth), as flat sales in North America undercut mid single-digit growth in Latin America. In the AOA (Asia, Oceania and sub-Saharan Africa) region, sales were up 1.4%, and grew by 4.8% on an organic basis, helped by a return to growth in China and strong result in Southeast Asia. However, the EMENA region (Europe, Middle East and North Africa) reported a 10.3% drop in sales (+1% organic), hurt by weakness in Western Europe.
By division, Nestlé Waters reported a 2% rise in sales (+4.0% organic), Nestlé Nutrition recorded a 0.4% increase (+0.9% organic), and its Other Business generated a 3.9% rise in sales (+3.7% organic).
The group attributed some of the results on hot summer temperatures, which reduced demand for categories such as coffee and pizza. It also said it had not been able to pass on price hikes to consumers in key markets, although CFO Francois-Xavier Roger said the group had “seen some signs of improvement in Western countries”.
Nestle now expects organic growth for the full year to be in the “lower half” of the 2%-4% it had set down earlier this year. (www.kamcity.com)
