Company maintains 2020 outlook, says it’s too early to assess full impact of pandemic,
VEVEY, Switzerland — Nestle is maintaining its full-year 2020 guidance for the time being, but there is no doubt COVID-19 has changed its business, at least temporarily.
The effect of the coronavirus on the Vevey, Switzerland-based company’s sales varied by geography, product category and sales channel, depending on the timing of the outbreak, the scope of restrictions and consumer behavior, Nestle said in reporting its sales for first-quarter 2020.
“Our company remained resilient in the first quarter, reflecting our diversified product portfolio and our strong local presence in 187 countries; however, this crisis is far from over, and we will face many uncertainties in the coming quarters. We will continue to adapt quickly to changing consumer needs and to challenges in our global supply chains,” said Mark Schneider, Nestle’s CEO.
Many markets, particularly in North America and Europe, saw significantly increased growth in March due to consumer stockpiling. Essential products, such as prepared dishes and cooking aides, saw increased demand, while products like confectionery and ice cream posted a sales decline, reflecting reduced gifting and impulse buying, according to Nestle.
E-commerce sales grew by 29.4%, exceeding 10% of total company sales for the first time.
Total sales decreased by 6.2% in the first quarter, while North America saw single-digit organic growth for the first quarter, according to the release.
The largest growth contributor was Purina PetCare. Frozen food also posted high single-digit growth in North America, with contribution from brands including DiGiorno, Stouffer’s and Hot Pockets. Baking products, including Toll House and Carnation, also saw elevated consumer demand.
While Nestle said it is too early to assess the full impact of COVID-19 on its business, it has a positive outlook.
“To date, [Nestle] has been able to effectively serve its retail partners and consumers despite some local disruptions in the supply chain and temporary staffing shortages. Nestle’s front-line workers have been instrumental in overcoming these challenges,” the company said.
The company also plans to continue to safeguard the health and well-being of its people, ensure business continuity to meet consumer demand and support communities around the world with relief efforts.
In the United States, Nestle comprises eight businesses: Nestle USA, Nestle Waters North America, Nestle Nutrition, Nestle Professional, Nespresso, Nestle Health Science, Nestle Skin Health and Nestle Purina PetCare Co.
Get today’s need-to-know convenience industry intelligence. Sign up to receive texts from CSP on news and insights that matter to your brand.
,Company maintains 2020 outlook, says it’s too early to assess full impact of pandemic,Read More