BERN (AFP): Swiss food giant Nestle said Thursday that strong sales of coffee, baking goods and pet foods helped raise overall turnover by 1.3 percent in the first quarter of the year.
Global sales rose to 21.1 billion Swiss francs (19.1 billion euros, $22.9 billion) and Nestle said it increased its share in growing markets, in an indication the group is weathering the coronavirus pandemic without much trouble.
On an organic basis, which excludes effects from acquisitions, divestments and foreign exchange movements, sales jumped by 7.7 percent in the first three months of 2021. Analysts polled by the Swiss agency AWP had only expected organic growth of around 3.5 percent.
The Swiss franc’s strength against other major currencies meant that once global sales were converted, the overall figure was reduced by 5.3 percent, while various divestments trimmed an additional 1.0 percent, the company said in a statement.
Nestle is transforming its portfolio of brands and has begun to increase its offer of vegetarian products, for example, to accompany global consumption trends.
And while “coffee was the largest contributor to growth” owing to strong demand for its Nespresso, Nescafe and Starbucks brands, dairy and baking products and pet food also contributed to the increase in organic growth. “Vegetarian and plant-based food offerings continued to see strong double-digit growth” as well, the group noted.
Nestle has benefited from the coronavirus pandemic in that demand via supermarkets remained strong, but sales to restaurants and other food outlets suffered in 2020.
In the first months of this year, “retail sales saw solid growth and out-of-home channels saw signs of improvement,” Nestle chief executive Mark Schneider said in the company statement.
The group confirmed its 2021 full-year forecast for “sustained mid single-digit organic growth,” which suggests something on the order of five percent.
Shares in the group jumped by 3.2 percent to 110.18 Swiss francs on the Zurich stock exchange, which was less than 0.1 percent higher overall.