Swiss food manufacturer Nestlé has issued a warning that it does not expect to reach its long-term targets this year.
Nestlé had previously predicted long-term underlying sales growth of 5-6%. The news comes as the manufacturing giant reports its slowest rate of sales growth in four years.
Sales rose by 2.7% to 92.2 billion Swiss francs (€75.5 billion) in 2013; underlying sales increased by 4.1%. The slowdown in European markets, and in emerging markets, were the key reasons given for the poor results.
Meanwhile, net profit decreased to 10 billion Swiss francs (€8.2 billion), due to restructuring and fluctuations in currency levels. However, the company recorded its strongest level of growth in the Asia, Africa and Oceania market; underlying sales rose by 7.4%.
US recorded a 5.1% rise in sales while European sales rose by 0.8%. The group recorded double-digit growth in Latin America.
“Last year was challenging and 2014 will likely be the same,” said chief executive Paul Bulcke. Expected sales growth for 2014 was around 5%, he added, with some improvement in margin levels.
@ 2014 ESM Magazine
