Archived article
Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
Nestle shows its pedigree with strong first half results

AJ Bell is an easy to use, award-winning platform Open an account
We've accounts to suit every investing need, and free guides and special offers to help you get the most from them.
You can get a few handy suggestions, or even get our experts to do the hard work for you – by picking one of our simple investment ideas.
All the resources you need to choose your shares, from market data to the latest investment news and analysis.
Funds offer an easier way to build your portfolio – we’ve got everything you need to choose the right one.
Starting to save for a pension, approaching retirement, or after an explainer on pension jargon? We can help.
Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
Shares in iconic food and drink-producer Nestle had a bit of a wobble after the firm reported a 10% increase in underlying first-half earnings but a small (0.2%) dip in its operating margin to 16.7%.
Like everyone else, Nestle is experiencing cost inflation in its raw materials but unlike many firms it is able to raise prices to at least mitigate some of the impact.
Organic sales growth was 8.1%, of which 6.8% was what the firm calls real internal growth – higher sales and increased market share – and 1.3% was thanks to higher prices. Moreover, the firm raised its full year sales growth forecast.
Headline sales were only up 1.5% to CHF 41.8 billion, as foreign exchange movements reduced revenues by 3.5% and divested businesses knocked another 3.1% off the total.
True to his promise when he took over, new-ish chief executive Mark Schneider continues to take the firm out of low-margin businesses and into direct-to-consumer markets.
The North American water business was sold for $4.3 billion and the proceeds recycled into buying the core nutrition and supplement brands of The Bountiful Company.
Nestle’s pet food business – makes up 15% of sales – was the biggest growth contributor in North America and Europe, and posted double-digit sales growth in China.
SHARES SAYS: Nestle is a world-class business, we remain buyers.
These articles are provided by Shares magazine which is published by AJ Bell Media, a part of AJ Bell. Shares is not written by AJ Bell.
Shares is provided for your general information and use and is not a personal recommendation to invest. It is not intended to be relied upon by you in making or not making any investment decisions. The investments referred to in these articles will not be suitable for all investors. If in doubt please seek appropriate independent financial advice.
Investors acting on the information in these articles do so at their own risk and AJ Bell Media and its staff do not accept liability for losses suffered by investors as a result of their investment decisions.
The value of your investments can go down as well as up and you may get back less than you originally invested. We don't offer advice, so it's important you understand the risks, if you're unsure please consult a suitably qualified financial adviser. Tax treatment depends on your individual circumstances and rules may change. Past performance is not a guide to future performance and some investments need to be held for the long term.
Our website uses cookies to give you a better browsing experience.
You can choose to accept all cookies, or control which we use by clicking 'Manage cookies'. To learn more, read our cookie policy.