Nestle Ltd.

Latest Results (23.05.2024):

Q1 2024 Financial Overview

Nestlé Ltd. reported a total sales of CHF 22.1 billion in the first quarter of 2024, marking a decrease of 5.9% compared to CHF 23.5 billion in the same period of 2023. This decline was influenced by a 6.7% negative impact from foreign exchange and a 0.6% reduction due to net divestitures. Despite these challenges, Nestlé confirmed its full-year outlook for 2024, expecting organic sales growth of around 4% and a moderate increase in the underlying trading operating profit margin.

Performance by Region

In the first quarter of 2024, Nestlé saw varied performance across different regions. Organic growth was primarily driven by Europe and emerging markets, which helped offset a sales decline in North America. In North America, the company faced a significant decrease in real internal growth (RIG) by -5.8%, leading to an overall organic growth of -2.5% in the region. Conversely, Europe reported a stronger performance with a 4.4% increase in organic growth, supported by a 4.6% rise in pricing.

Product Category Insights

Nestlé's product categories showed diverse growth dynamics in the first quarter of 2024. The Purina PetCare segment was a notable performer with strong demand driving organic growth. Conversely, the Nestlé Health Science division experienced a decline, primarily due to temporary supply constraints for vitamins, minerals, and supplements. The coffee segment, including popular brands like Nescafé and Nespresso, continued to show resilience with low single-digit growth.

Strategic Initiatives and Market Trends

CEO Mark Schneider highlighted several strategic initiatives underway at Nestlé, aimed at bolstering the company's market position. These include increasing innovation intensity in North America, particularly in the frozen food sector, and advancing the integration of Nestlé Health Science’s vitamins and supplements business. Schneider expressed confidence in a rebound in RIG in the upcoming quarters and emphasized the importance of executing with excellence and leveraging Nestlé's expertise in science and nutrition.

Outlook and Future Projections

Looking ahead, Nestlé remains optimistic about its performance for the remainder of 2024. The company reiterated its guidance, expecting an increase in underlying earnings per share in constant currency between 6% and 10%. This outlook is supported by a range of growth initiatives across the group, which are beginning to yield results, and a strong focus on driving growth with Nestlé's billionaire brands.