Nestlé expects its “real internal growth” to bounce back after a decline in the first quarter of 2024.
The key RIG metric, which excludes pricing effects, fell by 2% in Nestlé’s first quarter. The company attributed this drop to weaknesses in frozen pizza and snacks in the US, where low-income consumers opted for private label products.
Despite this, CEO Mark Schneider remains optimistic, stating that Nestlé is primed for a strong rebound in RIG. He highlighted the performance of Nestlé’s flagship brands such as KitKat, Purina, and Nespresso, which grew at twice the group average.
In North America, Nestlé faced challenges due to food-price inflation and a decrease in SNAP benefits, leading to a decline in purchasing power for low-income consumers. However, the company is focusing on innovation in categories like frozen foods to drive growth.
Looking ahead, Nestlé maintains its 2024 organic growth outlook at 4% and expects a moderate increase in trading profit margins. Despite challenges, the company remains confident in its ability to navigate the evolving market landscape.
Overall, Nestlé is focused on adapting to market dynamics, enhancing its product portfolio, and leveraging its strong brand presence to drive growth in the coming quarters.
For Nestlé, the road ahead includes targeted pricing strategies, continued innovation, and a focus on market share growth. The company remains committed to delivering value to consumers and shareholders alike.
