Nestle Q1 sales climb 6%

by Eric Schroeder
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VEVEY, SWITZERLAND — Nestle S.A. said first-quarter sales rose 6% to 25.7 billion Swiss francs ($25.5 billion), driven by strong organic growth and acquisitions, primarily the purchase of Novartis’ Gerber baby food unit and its medical nutrition business. Nestle only provides profit figures for the half year and full year.

"The strong start to the year reflects Nestle’s momentum as the world’s leading nutrition, health and wellness company," said Paul Bulcke, chief executive officer. "On the basis of this high-quality growth, with a good balance between real internal growth and pricing, I am confident that we will achieve our 2008 targets: organic growth approaching the 2007 level together with improved EBIT margins in constant currencies."

In a breakdown of sales by product group, Nestle said total food and beverage sales during January-March 2008 totaled 23,944,000,000 Swiss francs, up from 22,495,000,000 Swiss francs in the same period a year ago. Within food and beverage, strongest sales were recorded in milk products and ice cream, at 4,629,000,000 Swiss francs, followed by powdered and liquid beverages, 4,374,000,000 Swiss francs, and prepared dishes and cooking aids, 4,310,000,000 Swiss francs.

Confectionery sales totaled 2,968,000,000 Swiss francs in the first quarter, up from 2,870,000, 000 Swiss francs in the same period of 2007. According to Nestle, the product group benefited from a successful Easter as well as an excellent start to the year within the KitKat brand.

Nestle waters posted sales of 2,164,000,000, down 7% from the same period a year ago. Nestle said the downturn reflected a "tough comparison with an excellent first quarter in 2007, as well as softer market conditions in the developed world."

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