Organic growth, but also loss of turnover for Nestlé

Food giant Nestlé has recorded both organic growth and loss of turnover over the past year. CEO Mark Schneider is pleased with the results. "In a special year, we achieved an improvement in organic growth, profitability and returns for the third time. So the crisis did not slow us down." For 2021, the group expects organic growth to continue.

Swiss food group Nestlé saw net profit fall from €11,6 billion to €11,2 billion in the past year. Turnover also decreased by approximately 8,9% from €85,5 billion to €77,8 billion. Still, CEO Mark Schneider is not dissatisfied with these results. "The year 2020 was a special year, as for many. In this year we nevertheless achieved an improvement in organic growth, profitability and return on investment for the third year in a row. The global pandemic has not slowed us down."

The company's organic growth increased by 3,6%. This growth was mainly driven by the strong market for Nespresso in the United States and the excellent figures for Purina PetCare (+10,2%) and Nestlé Health Science (+1,7%). Free cash flow for the past year amounted to €9,4 billion. On the positive side, the dividend has again been increased to €2,53 per share. This means that the group has achieved dividend growth for 26 consecutive years. A total of €13,3 billion was paid back to shareholders last year through dividends and share buybacks.

Positive expectations
Looking at the current year, Nestlé expects another increase in organic growth. The food company thinks of a percentage between 3% and 8%. “At the same time, we remain focused on sustainability and charted the path to achieving net zero greenhouse gas emissions by 2050,” explains Schneider. "Looking at the medium term, we expect a moderate improvement in the underlying trading profit margin."

Kimberly Baker

Kimberly Bakker is an all-round editor at Boerenbusiness. She also has an eye for the social media channels of Boerenbusiness.

k.baker @boerenbusiness. Nl

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