Nestle SA Reg Shs. Ser. B Spons (ADR)(OTCMKTS:NSRGY) reported sales of CHF 91 billion in 4Q2014. Wan Ling Martello, the Chief Financial Officer, said that the organic growth in FY2014 comprises 2.2% pricing and 2.3% RIG. It is a solid performance and highlights two things. The first is ability to sustain growth especially in very difficult markets. Nestle SA focused on the value of brands and innovation. It engaged effectively with its customers.
The operating profit
Martello said that Nestle SA improved its trading operating profit by 30 basis points measured in constant currency. The operating cash flow came at CHF 14.7 billion. The last two years represent strong performance, and 2014 is no exception. The earnings per share surged 4.4% in constant currencies.
Nestle SA witnessed strong regional organic growth. It posted growth of 1.9% in Europe, 5.7% in Africa, Oceania and Asia and 5.4% in America. Real internal growth was 2.4% in Europe, 2.4% in AOA and 2.3% in Americas. The factors that affected growth are improvement in North America markets, deflation having an impact on pricing in Europe, slowdown in the China and Middle East affecting AOA and subdued growth in Latin America.
Analyzing the global presence, emerging markets posted 8.9% organic growth. Out of the total sales of CHF 40.2 million, 40% came from emerging markets. Developed markets posted 1.1% organic growth. O the basis of zone, Europe posted sales of CHF 15.2 billion, 2.2% RIG and OG of 1.5%. The growth in Europe was due to the launch of premium and innovative products in last year. It is evident in market share growth. The trading scenario in Europe is still tough with deflation leading to pricing problems. The customer’s confidence continues to be fragile. In eastern and central Europe, the growth was led by Russia.