First-quarter sales miss forecasts at Nestle

The maker of KitKat, Nescafe, Purina and Maggi, among others, said total reported sales fell 5.9% in the three months to March end, to CHF22.1bn (£19.3bn).

Prices rose by 3.4%, in line with expectations.

Organic sales, which exclude the impact of currency fluctuations as well as acquisitions, rose 1.4%. However, analysts had been expecting a rise closer to 2.9%.

Real internal growth (RIG), Nestle’s measure for sales volumes, also fell by more than expected, down 2% compared to a forecast 0.5% dip.

Sales growth in Europe and emerging markets was partially offset by a weaker performance in North America. Sales were down 2.5% on an organic basis in the region, which has been hit by weaker consumer demand and a decline in frozen food.

The group left its full-year outlook unchanged. But the shares still come under pressure, losing 3% by 1045 BST.

Mark Schneider, chief executive, said: “We had expected a slow start and see a strong rebound in RIG in the second quarter, with reliable delivery for the remainder of the year. A wide range of growth initiatives across the group are now starting to deliver.

“In North America, we have stepped up our innovation intensity and commercial activities, primarily in frozen goods, which lost ground in the first quarter.

“We reiterate our 2024 guidance and look ahead with confidence.”