Nestle Raises Sales Growth Forecast After Strong Q2 Results
Nestle on Thursday reported organic sales growth for the second quarter that exceeded expectations, and indicated it anticipates generating approximately 3 billion euros from a joint venture with investment firm Platinum Equity concerning its waters and premium beverages segment. The world’s largest packaged food company has revised its full-year organic sales growth forecast to a range of 3 percent to 4 per cent, adjusting from its earlier target of “around 3 percent.”
Nestle and Platinum Equity will each hold a 50 percent stake in the joint venture, which will be designated as Peranel, according to the company’s announcement. The company has been reshaping its portfolio under Chief Executive Officer Philipp Navratil, who has aimed to enhance growth and profitability by concentrating on the company’s core brands. Nestle indicated that its underlying trading operating profit margin for the second half of the year is expected to surpass that of the first half, driven by a decline in coffee and cocoa costs.
In the second quarter ending June 30, organic sales, which exclude the effects of currency fluctuations and acquisitions, increased by 3.7 percent, according to the manufacturer of KitKat candy bars and Nescafe coffee. Analysts had, on average, anticipated organic sales growth of 3.6 percent.
