Nestle FY Results
February 17/RTT News (United States) -- Swiss food and nutrition products giant Nestlé S.A. reported a surge in fiscal 2010 profit, helped by a significant gain from the disposal of its stake in eye care business Alcon. On a continuing operations basis, profit declined from the previous year. The company also stated that it is confident to meet its 2011 targets.
For fiscal 2010, profit attributable to shareholders was 34.23 billion Swiss francs or 10.12 Swiss francs per share, compared with 10.43 billion Swiss francs or 2.91 Swiss francs per share last year.
The world's largest food maker said net profit for fiscal 2010 included a net disposal gain of 24.5 billion Swiss francs from the divestiture of the company's remaining holding in Alcon to Swiss healthcare company Novartis AG (NVS) in August 2010.
On a continuing operations basis, profit attributable to shareholders of the parent declined to 8.78 billion Swiss francs from 9.26 billion Swiss francs a year ago. However, earnings per share from continuing operations were up at 2.60 Swiss francs, compared with 2.58 Swiss francs in fiscal 2009.
Underlying earnings per share reached 3.32 Swiss francs, an increase of 7.4% from the prior year, driven by strong like-for-like improvement in the group's performance.
Full-year sales totaled 109.72 billion Swiss francs, 2% higher than 107.62 billion Swiss francs reported in the previous year. Organic sales growth was 6.2% with a 4.6% real internal growth. While foreign exchange impacted sales by 3.6%, divestitures, net of acquisitions, reduced sales by 0.6%.
Sales from continuing operations rose 4% to 104.61 billion Swiss francs from 7.04 billion Swiss francs last year.
Based on business regions, Zone Americas and Zone Asia, Oceania and Africa delivered strong sales in fiscal 2010 while Zone Europe posted lower sales.
By operating segment, sales of Nestlé Waters rose from last year as it achieved growth in all three zones.
Nestlé Nutrition's sales also increased year-over-year, helped by its biggest division infant nutrition, which had a positive year particularly in infant formula and infant cereals.
In addition, sales of other Food and Beverages were up from fiscal 2009, with market share gains in all categories and regions, specifically in emerging markets. Pharma sales also were higher than the previous year.
Nestlé stated that its board of directors will propose a 15.6% increase in dividend to 1.85 Swiss francs per share to shareholders at the annual general meeting to be held on April 14.
The company's board will also propose the individual re-elections of Paul Bulcke, Andreas Koopmann, Rolf Hänggi, Jean-Pierre Meyers, Beat Hess and Naïna Lal Kidwai for a further term of three years. In addition, the board will propose the election of a new member Ann Veneman at the annual general meeting.
Going forward, Nestlé said it is confident to achieve organic growth of 5-6% and an EBIT margin improvement in constant currencies in 2011.
"We are starting 2011 with continued momentum, well placed to face uncertainties ahead, including volatile raw material prices," said, Paul Bulcke, chief executive officer of Nestlé.
From the February 18, 2011, Prepared Foods' Daily News
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