Mubasher: The world's largest food and beverage company, Nestlé, said its total sales fell by 9.5% during the first six months of 2020 to CHF 41.2 billion ($45 billion), compared with CHF 45.5 billion ($49.7 billion) in the corresponding period in 2019.

Divestitures and foreign exchange contributed to lower sales by 12.3%, according to a recent press release.

The net profits of the multinational food product manufacturer grew by 18.3% during for the January-June period in 2020 to CHF 5.9 billion, while organic growth reached 2.8%, with real internal growth (RIG) of 2.6%.

Net profit margin gained 340 basis points (bps) to 14.3%, the underlying trading operating profit (UTOP) margin reached 17.4%, up 30 bps, while the trading operating profit (TOP) margin increased by 140 bps to 16.9%.

Commenting on the results, Nestlé CEO, Mark Schneider, stated, "Nestlé has remained resilient in a rapidly changing environment, delivering solid organic growth and improved margins in the first half. These results demonstrate the agility of our business and the strength of our diversified portfolio across geographies, product categories, and channels.”

“With consumer behaviour evolving faster than ever, we are adapting to this new reality by strengthening our innovation, leveraging our digital capabilities, and executing with speed," Schneider added.

Outlook for 2020

Nestlé expects full-year organic sales growth between 2% and 3%. The underlying UTOP margin is likely to improve and the underlying EPS in constant currency and capital efficiency are expected to increase. This guidance is based on Nestlé’s current knowledge of COVID-19 developments and assumes no material deterioration versus present conditions.