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Hot summer lifts Nestlé in Europe

By staff reporter , 23-Aug-2006

Nestlé said bottled water and ice cream sales had been helped in the first half in Europe by the heatwave that has swept across the continent this summer.

Nestlé, reporting sales up 6.4 per cent for the first six months of 2006, confirmed it had seen a spike in water and ice cream sales this summer.

Temperatures this June and July rose to their highest levels since records began in Britain alone, leaving consumers baking and supermarkets and producers counting their winnings.

 

Paul Polman, Nestlé's chief financial officer, told the results conference: "Nestlé Waters was below its own averages but recovered in July…[and]… Ice cream was quiet ahead of its peak season but enjoyed double-digit growth as the weather picked up."

 

The weather has helped Nestlé to keep on track in Europe this year, bolstering stronger growth from other regions, such as the Americas and Asia.

 

Nestlé's beverages business grew sales by around eight per cent in the first half, with a continued double-digit increase for bottled water in North America. Instant coffee brands, and notably Nespresso, also performed well in all regions, the firm said.

 

It is bottled water, however, that has driven Nestlé's beverages success.

 

Polman said the group's lower priced Aquarel water, intended to fight private label products and discounters, had continued to show dynamic growth in Europe during 2006.

 

Subsidiary Nestlé Waters, which owns the Perrier and Vittel brands, this year overtook Danone to become the world's largest bottled water producer, with an 18 per cent share of global market value.

 

The group has continued to probe emerging markets, and recently signed a joint venture with the number one bottled water firm in Turkey, Erikli.

 

Nestlé Waters will hold a 60 per cent stake of the merged company, and get its hands on Turkey's leading premium bottle water brand at a time when the market is showing double-digit volume growth.

 

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