Nestle beats first-half organic sales expectations

LONDON (Reuters) -Nestle improved its full-year organic sales outlook and reported better-than-expected first-half organic sales, as the world's biggest packaged food company again raised prices to cope with higher input costs.

Nestle said it is narrowing its full-year organic sales growth guidance to a range of 7%-8% from a range of 6-8%.

The Swiss company, which makes Kit Kat chocolate wafer bars and Nescafe coffee, said organic sales during the period rose 8.7%, beating average estimate 8.1% growth, according to a company-provided analyst consensus.

Nestle's 9.5% price increases were ahead of the average analyst estimate of 8.7%. Real internal growth - or sales volumes - fell 0.8% versus expectations of a 0.6% decline.

"For the remainder of the year, we are confident that we will deliver a positive combination of volume and mix, an improvement in gross margin and a significant increase in marketing investments," CEO Mark Schneider said in a statement.

The consumer goods company is one of several - from Unilever to P&G - that have in the past two years struggled to manage high costs of everything from sunflower oil to packaging. Their problems began with the Covid-19 pandemic and unusual weather patterns hurting agricultural commodities, and have worsened since Russia's invasion of Ukraine.

(Reporting by Richa Naidu; Editing by Kim Coghill)

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