Nestle 2020 Was Broadly In Line; Organic Sales Growth Beat Consensus -- Earnings Review
February 18 2021 - 6:31AM
Dow Jones News
By Giulia Petroni
Nestle SA reported full-year 2020 results earlier on Thursday.
Here's what we watched:
PROFIT: The Swiss food-and-beverage company said net profit for
the year was 12.23 billion Swiss francs ($13.65 billion), above
analysts expectations of CHF11.97 billion, according to a
company-compiled consensus.
SALES: Sales fell to CHF84.34 billion from CHF92.57 billion the
previous year. A company-compiled consensus had forecast sales at
CHF84.78 billion.
WHAT WE WATCHED:
-ORGANIC GROWTH: Nestle reached an organic growth of 3.6%, above
a company-compiled consensus that had forecast it at 3.5%. This
implies an improved fourth quarter with growth close to 4%, or 40
basis points above consensus, analysts at Citi say. The result was
driven by a strong performance in the Americas, as well as petcare
products and supplements sold by the Health Science division.
-PET FOOD: Purina PetCare was a key growth driver, with an
organic sales growth of 10% on year. The category is outperforming
on the back of consistent market share expansion over the last 20
years, Chief Executive Mark Schneider said.
-2021 GUIDANCE: Nestle points to continued improvement in
organic sales growth toward mid single-digit levels and a moderate
margin expansion--targets that analysts say might seem conservative
against more upbeat expectations, but are deemed credible and
uncontroversial given the challenging context. "We note that some
peers were not able to hold their improved margin level and are now
facing declining margins; therefore, in relative terms, Nestle is
delivering more sustainably," Baader Helvea says.
Write to Giulia Petroni at giulia.petroni@wsj.com
(END) Dow Jones Newswires
February 18, 2021 07:16 ET (12:16 GMT)
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