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Nestlé Reports Half-Year Results for 2024, Coffee Named Largest Organic Growth Contributor

By: Alexis Rubinstein, Managing Editor - Coffee Network

 
Alexis Rubinstein
Managing Editor

CoffeeNetwork (New York) – Nestle has reported their half year results for 2024. Coffee was the largest organic growth contributor with mid single-digit growth, supported by our three leading global coffee brands Nescafé, Nespresso and Starbucks.

Highlights include:

  • Organic growth of 2.1%, with positive real internal growth (RIG) of 0.1% for the first half and 2.2% for the second quarter improving in all Zones and categories. Pricing of 2.0%.
  • Total reported sales of CHF 45.0 billion (-2.7%), with an impact from foreign exchange of -4.4% and net divestitures of -0.4%.
  • Underlying trading operating profit (UTOP) margin increased 30 basis points to 17.4% on a reported basis and up 40 basis points in constant currency.
  • Trading operating profit (TOP) margin increased 50 basis points to 16.4% on a reported basis.
  • Underlying earnings per share up 3.3% in constant currency (-1.0% on a reported basis to CHF 2.40). Earnings per share increased 1.8% to CHF 2.16 on a reported basis.
  • Free cash flow up CHF 0.6 billion to CHF 4.0 billion.
  • Full-year 2024 outlook updated: we expect organic sales growth of at least 3%. Underlying earnings per share in constant currency is expected to increase at a mid single-digit rate. Underlying trading operating profit margin guidance unchanged with a moderate increase expected.

For Nespresso, organic growth was 1.8%. RIG was 1.1%, improving to 2.4% in the second quarter. Pricing was 0.7%. Foreign exchange negatively impacted sales by -2.9%. Reported sales in Nespresso decreased by -1.0% to CHF 3.1 billion. By geography, sales in North America grew at a mid single-digit rate with market share gains. Europe posted close to flat growth.

Growth was driven by the Vertuo system, with continued broad-based sales momentum. New product launches, including the expansion of compostable capsules in seven European markets, supported growth. Out-of-home channels continued to generate robust growth, fueled by the further adoption of the Momento system.

The underlying trading operating profit margin of Nespresso decreased by 20 basis points, following increased advertising and marketing investments to drive future growth.

Alexis Rubinstein

 

  • Coffee

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