The food company Nestlé picked up speed in 2021. Sales climbed to 87.1 billion francs, as the manufacturer of Nespresso, Maggi and KitKat announced on Thursday. The Swiss group thus achieved an increase of 7.5 percent adjusted for acquisitions and sales of divisions and currency influences and exceeded analysts’ expectations.
Things went well, especially in the shops with coffee and pet food, as well as health products such as vitamins, which had benefited from the Corona crisis. In the previous year, organic sales growth had amounted to 3.6 percent. Driven by the sale of a package to the cosmetics group L’Oreal, profits rose by 38.2 percent to CHF 16.9 billion. Nestle expects growth to slow down in the current year.
The group from Vevey on Lake Geneva announced an organic increase of around five percent and an operating profit margin of between 17 and 17.5 (2021: 17.4) percent. “We have a certain element of caution in our 2022 guidance given the inflationary environment,” CEO Mark Schneider said on a conference call. Higher raw material, energy, transportation and labor costs slowed things down. Inflation is also causing problems for other consumer goods companies. The British Unilever recently warned that margins are likely to shrink in 2022 because the manufacturer of Langnese ice cream or Knorr soups cannot pass the price increase completely on to consumers. Nestlé plans to raise the dividend by five centimes to CHF 2.80 per share. This is the 27th dividend increase in a row. Nestlé has achieved the best organic sales growth since 2011, explained ZKB analyst Patrik Schwendimann. In contrast, the group slightly missed expectations for the operating margin. Nestlé shares rose by half a percent on the Zurich stock exchange. A top personnel from the group was also announced on Thursday: Nestlé nominated Apple’s current chief financial officer for election to its board of directors. The Italian Luca Maestri, who has been responsible for the finances of the iPhone manufacturer since 2014, is to move into the body after the general assembly on April 7, as Nestlé announced. In addition, Chris Leong, head of marketing at the French electrical engineering group Schneider Electric, will be proposed for election to the board of directors. According to Nestlé, Ann M. Veneman is retiring from the board. Board member Kasper Rorsted has also decided not to stand for re-election. With the proposed candidates, the Nestlé Board of Directors will now consist of 14 members.