Swiss food giant Nestlé has said its first-quarter sales increased 3.5% and it expects to report positive results as the year progresses.

Nestlé said consolidated first-quarter sales were CHF20.4bn (US$15.5bn), compared to CHF19.7bn in the year-ago period. Organic growth improved to 5.1%, with real internal growth of 3.4%, the company said. Divestments, net of acquisitions, reduced reported sales by 1.3%, reflecting mainly the sale of the low-margin beverage distribution business Trinks in Germany. The negative foreign exchange impact was only 0.3%.

CEO Peter Brabeck said the best-performing product units included coffee, milk products, nutrition and ice cream.

Nestlé said it continues to look forward to the coming months with “cautious optimism” and it expects the improving economic climate in several regions to benefit consumer confidence.

“The group in 2004 is again focused on further margin and cash flow improvement and, barring major unforeseen events, Nestlé expects to be able to report positively as the year progresses,” the company said.