Nestle Raises Full-Year Organic Growth on Price Increases & Coffee Sales
Nestle raised its sales guidance on Wednesday, now forecasting full-year organic growth of 6-7% following strong coffee sales and price hikes pushing organic sales 6.5% higher in Q3.
The company has found a solution to rising input costs, which food groups have been facing, via price increases of 2.1% in Q3.
"The company knocked it out of the park for the third quarter. Most companies with strong brands will be able to pass on prices and I think the market still does not get that”, Kepler Cheuvreux analyst - Jon Cox commented.
Nestle shares, up 8% so far this year, were expected to open 0.8% higher in pre-market trading. Organic sales of the company rose 7.6% in the first nine months, the group said in a statement, beating a forecast for a 6.6% increase in a company-compiled consensus.
Aside from prices, strong coffee sales have also become a driver, with Starbucks-branded products demonstrating a 15.5% growth and Nespresso portioned coffee - 11% growth.
Nestle still expects an underlying trading operating profit margin at about 17.5% this year and a "continued moderate margin improvement" in the midterm.
*The products advertised are only available to clients under Fondex Limited (SDL No: SD037). Trading CFDs involves significant risk of loss.
Cookies on Fondex
These cookies fall under the following categories: essential, functional and marketing cookies. Marketing cookies may also include third-party cookies.
You can customize your selection of which cookies you want to accept.
These cookies are necessary for the website to function correctly and cannot be switched off.
Functional cookies allow the website to remember users' preferences and the choices you make on the website such as username, region, and language.