Nestle's growth affected by rising raw material costs

Slashdot It!

The Swiss food group Nestle said Thursday that growing raw material costs were having an impact on its growth, as it posted a nine percent increase in sales over the first nine months of the year.

Nestle said in a statement that "input cost pressures were increasing over the second half of the year" and having a "dampening effect" on real internal growth.

The multinational's sales over the first nine months of 2007 reached 78.7 billion Swiss francs (47 billion euros, 67 billion dollars), exceeding analysts' expectations. Nestle did not release data for the third quarter.

"In spite of increasing input cost pressures, I remain confident that Nestle will achieve above-target organic growth and a sustainable margin improvement for 2007 as a whole," said Nestle Chairman and Chief Executive Peter Brabeck.

Organic growth over nine months -- a measure of business performance that excludes financial investments or acquisitions -- reached 7.2 percent, including 2.7 percent due to price rises, the company said.

Nestle maintained its outlook for above target organic growth for the full year. In August, the company said it expected to exceed its original target of five to six percent in 2007.

Get paid to blog