Nestle 1Q Organic Sales Growth Beat Expectations -- Earnings Review
24 April 2020 - 11:35PM
Dow Jones News
By Giulia Petroni
Nestle SA on Friday reported sales for the first quarter of the
year. Here's what we watched:
SALES: The Swiss food and beverage giant reported sales of 20.81
billion Swiss francs ($21.36 billion), down from CHF22.18 billion
the previous year. Analysts had forecast sales at CHF21.10 billion,
according to a company-compiled consensus.
Organic sales growth--a measure stripping out currency changes,
acquisitions and divestments--rose 4.3%, beating analysts'
estimates of 3%.
WHAT WE WATCHED:
-STOCKPILING: Strong organic sales growth was mainly driven by
North America and Europe, as both regions benefited from consumers
stockpiling in the face of state lockdowns. Prepared meals, pet
food and coffee were among the largest growth contributors, helping
outweigh sales declines in China.
-PORTFOLIO: The company confirmed it is considering the
potential sale of its Yinlu peanut milk and canned rice porridge
businesses in China, which generated sales of CHF700 million in
2019.
-GUIDANCE: Nestle said it would maintain its 2020 guidance "for
the time being," adding it expects improvement in organic-sales
growth and underlying trading operating profit margin. Underlying
earnings per share in constant currency and capital efficiency are
also expected to increase. The company said it is still early to
fully assess the impact of Covid-19.
Write to Giulia Petroni at giulia.petroni@wsj.com
(END) Dow Jones Newswires
April 24, 2020 09:20 ET (13:20 GMT)
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