SWITZ: Bulcke says Nestle "slow on price cuts" - report
By: just-food.com | 2 November 2009
Global food giant Nestle has admitted that it should have reacted faster to competitors' price cuts to avoid slowing sales.
Speaking during an interview with the Wall Street Journal, chief executive Paul Bulcke said the group "should have seen the dangers" of losing market share to aggressive pricing by competitors such as Unilever, Danone and Kraft Foods, earlier.
"Sometimes during the year we should have engaged faster to counter these actions... Sometimes we should have had more intensity in our reaction," Bulcke told the publication.
However, he added that Nestle's long-term business plan remained unchanged and that "major acceleration" in growth could come from emerging markets, where the group has accelerated its introduction of low-cost products.
The Swiss food giant posted a drop in nine-month revenue last month, hurt by the euro's decline against the Swiss franc.
Sales dropped to CHF79.55bn (US$79bn) from CHF81.36bn a year earlier. The company said it plans to buy back CHF7bn of shares this year, up from a previous CHF4bn target.
The group's organic growth slowed to 3.6% in the third quarter, but Bulcke told the Wall Street Journal that the company was sticking to its long-term growth guidance of 5-6%. He said the company saw higher volume growth in the third quarter than in the previous one, and that the slowdown was partly due to the removal of "under-performing items".
Bulcke refused to comment on whether Nestle would make a counter bid for confectionery-maker Cadbury.
Sectors: Bakery, Confectionery, Snacks
Companies: Nestle, Unilever, Danone, Kraft Foods, Cadbury
View next/previous articles
2 Nov 2009 -
Currently reading -
SWITZ: Bulcke says Nestle "slow on price cuts" - report
Related research
Global market review of probiotics – forecasts to 2013
Probiotics are the so-called ‘good bacteria’ which help to maintain a healthy balance of bacteria within the digestive system. The World Health Organization (WHO) defines probiotics as “live micro-organisms which, when consumed in adequate amounts, p...
Company Financials: Hindustan Unilever Limited
IntroductionThe Company Financials offers insights into the financial performance of the company over last five years for about 1000 leading global companies. The datapack covers wealth of financial information relating to income statement, balance s...
Company Financials: Groupe Danone
IntroductionThe Company Financials offers insights into the financial performance of the company over last five years for about 1000 leading global companies. The datapack covers wealth of financial information relating to income statement, balance s...
Related articles
Quote, unquote: just-food's week in words
The industry saw a raft of quarterly results this week from Unilever, Safeway Inc, Kellogg, Chiquita and Premier Foods plc, among others. Unilever CEO Paul Polman adopted a typically cautious tone, despite an acceleration in sales and volumes, while Safeway CEO Steve Burd remained more upbeat on profits despite a tumble. Sodium reduction once again appeared on the menu as the CSPI hit out at US companies that have not yet joined the New York initiative to cut salt, while Kraft and Heinz both pledged targets for mayor Michael Bloomberg's programme. Here is a selection of who said what about the top stories in the food sector this week.
On the money: Unilever boss tries to rein in expectations
Unilever chief executive Paul Polman today (29 April) warned investors "not to run ahead of yourselves" despite the consumer goods group seeing sales and volumes accelerate in the first quarter of 2010.
There are currently no comments on this article
Be the first to comment on this article