Nestlé CEO Mark Schneider hailed the launch of Starbucks-branded products a “great success” as the world’s largest packaged food company posted organic sales growth of 3.5% last year.
The KitKat and Nescafé owner paid $7.15 billion in 2017 for exclusive rights to sell Starbucks products, which have now been rolled out in more than 40 countries. In 2019, the products generated more than CHF 300 million ($307.2 million) of incremental sales.
Nestlé’s total sales for 2019 stood at CHF 92.57 billion ($94.77 billion). Full-year net profit was up 24.4% to CHF 12.6 billion ($12.9 billion).
Vegetarian and plant-based food products, including the Sweet Earth Awesome Burger and the Garden Gourmet Incredible Burger, saw double-digit organic growth.
Nestlé CEO Mark Schneider.
“The company is fully embracing the need for speed, as the rapid expansion of our new plant-based food and beverage offerings has shown,” said Schneider. “We are getting to market faster with must-have products.”
Last year, Nestlé completed acquisitions and divestments with a total value of around CHF 10.4 billion ($10.65 billion). In December, an agreement was reached to sell its US ice cream business for $4 billion to the Froneri ice cream joint venture with PAI Partners.
The company also secured a deal to sell a 60% stake in its Herta charcuterie business to Casa Tarradellas and create a new joint venture for Herta with the respective equity stakes of 40% and 60%.
“We saw strong progress in 2019, with key operating and financial metrics improving significantly for the second consecutive year. Organic growth accelerated, fueled by strong momentum in the United States and Purina PetCare globally,” Schneider added.
“Profitability improved again and reached our guided range one year ahead of plan. Cash flow was strong, while underlying earnings per share and returns to shareholders reached record levels.”
The company said the coronavirus has required an “extraordinary effort” from its team in China, its second-largest market, but that it was too soon to quantify the financial impact of the outbreak.
© FoodBev Media Ltd 2020
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