Ingredients-checking ‘halal apps’ could provide false security29 May 2017
Ramadan in the UK: Supermarkets missing a trick to capture the halal market28 May 2017
Rampant food inflation and a debased currency cause for concern for Egyptians this Ramadan24 May 2017
INTERVIEW-UAE’s only halal-certified luxury chocolatier to double capacity with new factory24 May 2017
KEY TAKEAWAYS-IFANCA International Halal Food Conference 201714 May 2017
Pakistan strengthening its halal ecosystem, putting ‘religion first’ in accreditation08 May 2017
Digital advertising for Ramadan: Foodtech start-up Zomato shares tasty search insights01 May 2017
Int’l Halal Accreditation Forum seeks greater inclusivity, raises concerns on industry practices05 Apr 2017
Seeking growth: How attractive is Uzbekistan’s halal food market?27 Mar 2017
’Clean meat’: Is lab-grown chicken and duck halal?26 Mar 2017
New Nestle CEO ditches sales target after latest missPrint
Photo: Nestle CEO Ulf Mark Schneider(L) and Chief Financial Officer Francois-Xavier Roger(r) during a news conference at the company headquarters in Vevey, Switzerland, February 16, 2017. REUTERS/Pierre Albouy
Thu Feb 16, 2017 | 4:00am EST | VEVEY, Switzerland
Nestle's (NESN.S) new chief executive scrapped the food company's long-standing sales target as it reported disappointing annual results on Thursday, adopting a more cautious tone in an uncertain environment.
The maker of Kitkat chocolate bars and Nescafe coffee is aiming for 2 to 4 percent underlying sales growth this year, below analysts' estimates and the "Nestle Model" for growth of 5 to 6 percent.
In his first public appearance since becoming CEO at the start of the year, food industry newcomer Ulf Mark Schneider said the lower target reflected economic uncertainty.
"This is a volatile and still somewhat deflationary environment," Schneider told reporters at the company's Vevey headquarters. "We felt this was wise and prudent."
The earnings from Nestle are the latest in a series of tepid results from consumer goods groups which have blamed weakness in the emerging markets that had previously fueled their growth.
In 2016, Nestle's net profit fell and sales rose less than expected, hit by slowing emerging markets and deflation.
The company's shares were down 1.1 percent at 72.35 Swiss francs at 0845 GMT (2:45 a.m. ET).
Schneider replaced the "Nestle Model," which the Swiss company has missed for four straight years, with the slightly vaguer goal of "mid-single-digit organic growth and significant structural cost savings by 2020".
He said he expects pricing to improve this year and plans to use a combination of cost-cutting and portfolio management to help hit his mid-term targets.
The company, which also makes Gerber baby food and Perrier water, forecast a "stable" trading operating profit margin in 2017, due to expectations for increased restructuring costs of around 500 million Swiss francs ($498 million).
WEAKER THAN EXPECTED
Nestle, the world's largest packaged food group, reported 2016 sales of 89.5 billion Swiss francs ($89.3 billion), up 3.2 percent on an organic basis. That was below the 4.2 percent growth seen in 2015 and marks the fourth time Nestle has missed its model for 5-6 percent growth.
Analysts on average were expecting 2016 growth of 3.4 percent, according to a Reuters poll.
Net profit fell to 8.5 billion francs, well short of the average estimate for 9.59 billion francs in the poll, hit by a one-off non-cash adjustment to deferred taxes and an inventory level adjustment at Nestle Skin Health.
Nestle proposed to increase its dividend to 2.30 francs per share, after 2.25 francs last year.
Growth in emerging markets slowed to 5.3 percent from 7.0 percent a year ago, hit by continuing problems at the Yinlu drinks business in China. ($1 = 1.0038 Swiss francs)
(Additional reporting by Angelika Gruber; Editing by Michael Shields/Keith Weir)
© Thomson Reuters 2017 All rights reserved
Saverah Women Expo 2017
- InterContinental London - The O2
London Halal Food Festival 2017
- Tobacco Dock The Dock Tobacco Quay Wapping Lane, London. E1W 2SF
Change, Challenges and Opportunities: Strategies for a Sustainable Future in Asia
- Universiti Brunei Darussalam, Bandar Seri Begawan, Brunei Darussalam
Delivery Hero buys Middle East firm Carriage
29 May 2017 | finance-investing
UPDATE 1-Famous Brands scraps dividend as acquisitions boost debt
29 May 2017 | finance-investing
Egypt has procured 2.9 million tonnes of local wheat since start of season
28 May 2017 | production
Malaysia: Perlis bans Muslim traders from selling cooked food before 2pm during Ramadan
28 May 2017 | regulations-compliance