Keep on growing: Nestlé and Danone publish their 2011 results
June 1, 2012
Nestlé and Danone have reported their 2011 results, showing an increase in water sales for both companies of 5% and 13.2% respectively. The two market leading companies in the food and beverage sector also witnessed volume growth in their water divisions.
Nestlé
The Swiss group, which has risen to number 42 in the global 500 ranking of the world’s largest companies, released its results on February 16th.
Nestlé Waters reported 2011 sales of CHF 6.5 billion, a 5.2% organic growth, a 3.4% real internal growth and an 8.0% trading operating profit margin. The trading operating profit margin increased by 90 basis points due to rigorous cost management, especially in Europe, pricing and strong growth in Europe and emerging markets.
Nestlé Waters European business gained share, with a strong performance in most markets including France, Italy, Germany and the UK. The division also continued to build a stronger presence in the emerging markets where sales exceeded CHF1bn.
Nestlé Pure Life continued to produce double digit growth worldwide. There was also high single-digit growth from the international brands, which are all strong contributors globally. Vittel and Hépar performed well in Europe, while Ice Mountain and Ozarka were the strongest of the regional US brands.
As to the environment, Nestlé Waters reported having reduced its non-renewable energy consumption per litre produced by 22%, its packaging weight per litre produced by 19% and its water use ratio by 34% between 2005 and 2010.
“We delivered a good performance, top and bottom line, in both emerging and developed markets in 2011. It was a challenging year, and we do not expect 2012 to be any easier”, said Paul Bulcke, Nestlé CEO.
“Our innovation is creating opportunities in all categories, whether by bringing new consumers to our brands in emerging markets, or by building on our consumers’ engagement with our brands in the developed world. Our people are aligned behind our strategic road map, which is as relevant in today’s new reality as ever, to drive sustainable performance improvement. We are therefore well positioned in 2012 to deliver the Nestlé Model of organic growth between 5% and 6% as well as an improved margin and underlying earnings per share in constant currencies”, he continued.
Danone
Group sales jumped 7.6% to € 5.1 bn in the first quarter compared with last year. The water division posted a record 23.3% like-for-like increase in sales in the fourth quarter of 2011, driven by a 10.1% increase in sales volumes and a 13.2% increase in sales value.
According to the Group, above exceptional performance of the water division in the last quarter reflected a combination of factors benefiting every area of this business: mild weather and good growth for the water category in Western Europe; the year's best performance in the top emerging countries of Indonesia, Mexico, China and and Argentina and accelerated growth in the aquadrinks segment.
Danone also stated it is committed to reducing its carbon intensity (grams of CO2 per kilogram of product sold) by 30% over 2008-2012. In line with this commitment, the French group cut its carbon intensity by 27.5% from 2008 to 2011. The Group is maintaining its 30% reduction target for 2012, i.e., over a five-year period.
“First and foremost, our results made 2011 a successful year, as we once again met all our targets. Organic growth in sales stood at 7.8%, both for full year and in the fourth quarter. We met our target for margin expansión and our free cashflow continued to increase sharply, gaining over 9%”, said Franck Riboud, Danone Chairman and CEO.
“We are moving into 2012 with confidence and energy, with our Group both strong and actively engaged in building its business. Looking ahead, we anticipate no improvement in the economic environment or in consumer spending in 2012, and our priorities for the year remain the same: leveraging our growth drivers, investing in our categories and brands and managing inflation and volatile costs while maintaining our competitive edge”, he continued.