Nestlé and Unilever in tasty sales
Improved pricing power experienced at both companies provides an early sign of recovery for the food-and-beverage market
Zurich/London — Nestlé and Unilever reported sales that beat estimates as the European food giants pushed through cost increases to combat slowing purchases by pickier consumers opting for quality over quantity. Nestlé said organic revenue rose 2.3% in the first quarter, compared with the 2% median estimate. Unilever’s sales growth of 2.9% exceeded analyst predictions of 1.9% as it issued its first results announcement since rebuffing a takeover approach from Kraft Heinz. Improved pricing power at both companies provided an early sign of recovery for the food-and-beverage market after years of deflationary pressure in Europe, slowing sales in China and economic crises in Brazil and Russia. Higher commodity costs, inflation in Brazil and the fall in the pound since the UK’s vote to leave the EU are contributing to the pressure. "Pricing was better than expected," Jon Cox, an analyst at Kepler Cheuvreux, said. "Everybody has to increase prices, and generally that’ll be sticky." Nestlé...
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