Strong Nestlé first quarter sales

Nestle sees strong organic growth of 7.4% with a positive contribution from all regions and businesses, partly due to higher demand ahead of expected price increases.

Peter Brabeck-Letmathe, chairman and CEO, says: “Nestle is off to a strong start, not least with an excellent performance reflecting the acceleration of our move towards nutrition, health and wellness across our main food and beverages brands, as well as the strong performance of our globally-managed Nestle Nutrition unit, which achieved its long-term target of 10% organic growth. Input costs remain high, but our strong brands enable us to continue to adjust prices. We therefore expect the Group to reach its objectives of organic growth between 5 and 6%, as well as continued improvement of the EBITA margins in constant currencies in 2007. The acquisition of Gerber has further accelerated the transformation process.”

In the first quarter of 2007, the Nestle group reached consolidated Swiss franc sales of 24.3 billion (€14.7bn), up 6.4% over the same period last year. Reported sales benefited from a strong organic growth of 7.4%, of which 5.7% were from real internal growth and 1.7% from price increases.

Nestle Nutrition reached its longer-term 10% organic growth target for the first time. The globally managed business achieved strong growth around the world due to a continued focus on value-added innovation across its infant nutrition products and a particularly strong performance of Healthcare Nutrition.

Milk products and ice cream achieved 6.5% organic growth. Milk products’ organic growth was heavily influenced by price increases to offset significantly higher milk costs. CoffeeMate performed well in the US. Ice cream had a strong start to the year, with good performances from super premium brands such as Haagen-Dazs and Movenpick, as well as the successful introduction of nutritionally enhanced products.