Nestlé confectionery sales rise despite pandemic
Nestlé has recorded increased revenues from its confectionery division, recording CHF 1.7 billion in sales for its latest quarter, against 1.63 billion for the same period in 2020, reports Neill Barston.
The positive results for the Swiss-based firm came despite the ongoing impact of the global coronavirus pandemic, as the group as a whole reported improved fortunes.
Its overall results for the first three months reported CHF 21.9 billion against CHF 20.8 billion in the corresponding period last year.
The company reported organic of growth 7.7%, with improved results seen on a broad-base across most geographies, supported by early signs of recovery from out-of-home channels, improved pricing and market share gains.
In its outlook the company forecast continued increase in organic sales growth towards a mid single-digit rate. Underlying trading operating profit margin with continued moderate improvement. Underlying earnings per share in constant currency and capital efficiency expected to increase.
Confectionery reported low single-digit growth, with strong sales developments in France and Russia. Incoa, a premium chocolate made exclusively with cocoa fruit and no added sugar, was launched in France and the Netherlands with other European markets to follow.
Notably, in North America, revenues from ice cream and confectionery were encouraging, with sales in Canada growing at a double-digit rate, that were reportedly driven by Häagen-Dazs and KitKat brands.
By channel, retail sales posted high single-digit organic growth, reflecting continued strong demand for at-home consumption. Sales declines in out-of-home channels moderated, with a return to positive growth in AOA. E-commerce sales grew by 39.6%, reaching 14.5% of total group sales.
Mark Schneider, Nestlé CEO, commented: “We are pleased with Nestlé’s strong organic sales growth in the first quarter, building on broad-based contributions from most geographies and product categories. Our growth was fuelled by disciplined execution, enhanced digital capabilities and rapid innovation, resulting in further market share gains.
“Retail sales saw solid growth and out-of-home channels saw signs of improvement. We confirm our guidance for the year and our mid-term outlook for sustained mid single-digit organic growth.”