Nestle 1Q sales drop, confirms moderating growth outlook

Switzerland's Nestle SA Wednesday (April 22) reported an unexpected drop in first-quarter sales as demand fell in developed markets and reiterated that it expects growth to moderate this year.

The world's largest food and beverages company said revenues fell 1.9 percent to 25.2 billion Swiss francs (US$25.2 billion), compared with CHF25.7 billion in the previous year and below market expectation of CHF26.05 billion.

Organic growth, an industry measure comprising volume growth and price increases, was 3.8 percent, compared with the growth of about 4.1 percent expected by the markets.

Nestle repeated previous guidance for an organic growth rate of "at least approaching 5 percent" this, below the rates seen in previous years. It also expects to improve the operating profit margin in constant currencies.

Nestle shares closed at CHF37.90 Tuesday (April 21). They are down 8.9 percent so far this year.