Dutch nutrition group Royal Numico has insisted the underlying trends in its business are sound despite slowing sales from its key baby food division.
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Numico, which is Europe’s largest infant-nutrition company, told just-food today (2 May) that it is on target to see group sales rise by 10-12% this year.
Numico posted an 8% rise in baby food sales during the three months to the end of March, a rise that missed the forecasts of some analysts. A spokesman for Numico said the company’s baby food business was lapping a strong first quarter from 2006.
“If you look at the numbers compared to last year, we had very high comparables in the first quarter,” the spokesman said. “Maybe if you look at the business from quarter-to-quarter, it is slower but our underlying figures are just as strong and we’re confident of making the 10-12% (target).”
Nestlé has grown its baby food business in recent months but Numico is unworried about the prospect of more competition in the category, the spokesman said. He said a rise in dairy costs is Numico’s main concern as it moves through 2007.
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By GlobalDataOn a group basis, Numico reported rising sales and earnings during the first quarter of the year. Profits rose 18% to EUR74m (US$100.6m) on the back of a 9.6% increase in revenue to EUR674m.
Earlier today, the company also announced a revamp to its management structure. Numico’s baby food and clinical nutrition units will look after their own product development. The company’s research facilities will report directly to the company’s CEO, Ajai Puri.
The spokesman said Numico the move is designed to “increase the speed of innovation” at the company.
