Chocolate is a challenge in Russia but Bulcke hailed local infant-nutrition sales

Chocolate is a challenge in Russia but Bulcke hailed local infant-nutrition sales

Swiss food giant Nestle said Russia continues to be a “mixed picture”, with chocolate in particular having a “tough time”.

The firm this morning (21 April) booked an increase in first-quarter sales, boosted by its performance in emerging and developing markets.

For the three-month period, group sales amounted to CHF26.3bn (US$24.6bn), representing organic growth of 6.5%.

However, while Western Europe experienced positive real internal growth in all key markets, the more impulse-driven categories in Russia, such as chocolate, are still recovering, Nestle said.

“Russia is a bit of a mixed picture really,” CEO Paul Bulcke told analysts at the firm’s earnings conference this morning. “On a macro level we are seeing the famous green shoots of recovery but it is clear that the more impulse driven or more indulgent categories are suffering most and chocolate is quite an indulgent category.”

He added: “Chocolate has been having a tough time and chocolate for us is big business in Russia.”

However, Bulcke said the firm was performing “very strongly” in infant nutrition in the country.

“We have had 20% plus growth for well over a year, so a very strong performance there. Hopefully things will continue to recover and we will see an improvement in performance in chocolate, he added.

Only last month, Nestle insisted that it remains committed to driving growth in Russia, despite the challenges that have hit consumption in the market over the past year.

The Russian economy slumped the most on record during 2009, with GDP falling 7.9% as the global economic crisis, the falling price of oil and rising unemployment levels took their toll.