Insight - Nestlé faces bottled water challenge
Commenting on a 3% organic sales decline for Nestlé Waters in the first half of 2009, the group said in a conference call today (12 August) that the bottled water category "continues to get weaker" in North America and Western Europe.
Weakness in developed markets has more than offset double-digit gains for Nestlé in emerging markets, the firm said.
"Our challenge is to find opportunities in North Anerica and some of the key markets here in Western Europe," the group said.
There were some limited positives for Nestlé Waters in the six months to the end of June, notably an 8% rise in operating margins due to lower costs - partly a result of the lower oil price and its subsequent impact on packaging costs.
The group also gained 2% bottled water market share in the US, due mainly to the Poland Spring and Pure Life brands. In France, Vittel "improved its competitive position", while Perrier also grew against its rivals.
"It seems to me that there are no major competitive issues," independent analyst James Amoroso told just-drinks.
"The rest of the world saw strong growth. The problem is simply the decline in the market as a whole in the US and Europe. We have seen this in Danone's results too," he said.
To see just-drinks' original story on Nestlé's first half results, click here.
Nestlé Waters is to cut 250 jobs at its production plant for Vittel and Contrex mineral water brands in eastern France....
Nestlé Waters North America has launched a marketing campaign to highlight the source of its regional spring water brands....
- Diageo Q4 & FY - Preview
- Is Diageo approaching its "Et tu, Brute" Moment?
- Has Diageo added Beer to its 'Non-Core' List?
- SABMiller, Carlsberg, Heineken: Poland's beer itch
- Diageo, Heineken and NBL in South Africa & Namibia
- NPD: Tomatin Contrast, Cù Bòcan
- Diageo, Heineken end South Africa, Namibia JV
- Diageo comm's director latest to leave
- Diageo hit by SEC investigation in US
- Pernod launches pomegranate whisky drink
- Global gin insights - market data, product innovation and consumer trends research
- Global rum insights - market forecasts, product innovation and consumer trends research
- Global Tequila insights - market forecasts, product innovation and consumer trends research
- Global cachaca insights - market data, product innovation and consumer trends research
- Global non-Scotch whiskies insights - market forecasts, product innovation and consumer trends research