Nestle Expects Sales to Beat Goal on Price Increases

Nestle Expects Sales to Beat Goal on Price Increases

March 13 (Bloomberg) -- Nestle SA, the world's largest food company, said it expects to beat its sales target this year, helped by price increases and higher shipments.

Revenue growth excluding acquisitions, divestments and currency fluctuations should be ``close'' to last year's rate of 7.4 percent, the Vevey, Switzerland-based company said in an e- mailed statement today. The maker of Nescafe soluble coffee has a long-term growth forecast of 5 percent to 6 percent.

Nestle said it had an ``outstanding organic growth rate'' in January and February, helped by new price increases and a ``successful'' Easter season.

Price increases averaging 3 percent on 10,000 products from Buitoni pasta to Purina pet food last year helped blunt the impact of soaring commodity prices and flagging consumer spending. Cocoa has risen 34 percent in the past 12 months and robusta coffee is up 77 percent. Nestle said today it expects raw material costs to ``abate somewhat'' in the second half.

Nestle reiterated it expects operating profit as a percentage of sales to gain this year, excluding currency fluctuations.

ΒLOMBERG