SWITZERLAND: Nestlé Waters sales drop H1

By | 12 August 2009

Weak bottled water markets in Western Europe and North America have damaged sales at Nestlé Waters and parent group Nestlé in the first half of 2009.

Nestlé Waters net sales fell by 3% on an organic basis to CHF2.4bn (US$2.2bn) for the six months to the end of June, compared to the same period last year, Nestlé said today (12 August).

Ongoing weakness in bottled water markets across Western Europe and North America offset double-digit sales growth in emerging markets, said the firm, which owns Vittel.

However, operating margins in water improved by 8% during the six months, due to lower oil prices and supply chain cost savings, the group added.

Nestlé said that group-wide net sales for the half-year fell 1.5% on a reported basis, to CHF52.3bn. Sales rose by 3.5% on an organic basis, it added.

Group net profits fell by almost 3% to CHF5.1bn, but operating margins across the firm's business divisions rose by an average 14%.

"The success of our efficiency initiatives enabled increased investment in consumer-facing marketing and R&D, which leads me to expect an acceleration in organic growth in the second half of 2009," said Nestlé CEO Paul Bulcke.

An update, following the company's results conference call, appears here.

Sectors: Water

Companies: Nestlé, Vittel

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