US EditionNestle sales slump under strong franc but volumes recover
Organic sales rose 3.5% as coffee and food volumes offset a 90 basis-point hit from the infant-formula recall, the company said.
- Nestle reported a 5.8% decline in total sales to 21.3 billion Swiss francs on Thursday, though organic sales rose 3.5% in the first quarter, meeting analyst expectations despite currency headwinds.
- An ongoing global health scandal involving the January recall of infant formula products, including SMA Follow-on Milk, weighed on growth by approximately 90 basis points during the quarter.
- Emerging markets delivered 6.8% organic growth, while Food & Snacks posted a 2.1% volume increase as consumer appetite for indulgent treats remained robust despite rising fuel prices shifting purchasing behavior.
- Nestle CEO Philipp Navratil confirmed product availability has returned to normal, while Vontobel analyst Jean-Philippe Bertschy said the results offer "reassurance" to investors about volume growth recovery.
- The company expects improved profitability and free cash flow exceeding CHF 9 billion this year, though higher energy and freight costs continue pressuring distribution expenses amid global uncertainty.
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Nestle sales slump under strong franc but volumes recover
Nestle, the food giant whose brands include Nespresso coffee and Perrier water, saw first-quarter sales figures slump due to the strong value of the Swiss franc and a baby formula recall, but sales volumes overall edged higher.
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