Nestlé reports 5.1% drop in Q1 net revenues

Nestlé has reported a 5.1% year-over-year decrease in net sales to CHF20.8bn ($23.6bn) for the first quarter of 2014, its results affected by severe weather in North America and weak consumer confidence in Europe.

Sales were also impacted by unfavourable exchange rates of 8.6%; however, organic sales growth was 4.2%.

Nestlé CEO Paul Bulcke said that the company’s organic growth in the first months of the year was in line with expectations and driven by volume rather than price.

Bulcke added, "The continued roll-out of new products, along with good execution, sustained this growth in difficult market conditions.

"We expect the continued strengthening of the Swiss Franc to have a negative impact on reported sales."

The Vevey-based firm registered growth in all regions across the world, with 4.6% in the Americas, 0.3% in Europe and 7.3% in Asia, Oceania and Africa.

In the Americas, Nestlé generated sales of CHF6bn with 4.1% organic growth as severe weather conditions had an impact across the categories.

Sales in the European region totalled CHF3.5bn with 0.8% drop in organic growth, while the Asia, Oceania and Africa region recorded 5.3% organic growth with revenues of CHF4.4bn.

Maintaining its full-year outlook, Nestlé expects around 5% organic growth with improvements in margins, underlying earnings per share in constant currencies and capital efficiency.