(Bloomberg) -- Nestle SA reported the slowest first-half sales growth since 2009 as the world’s biggest food company struggled to raise prices.
Sales increased 3.5 percent on an organic basis, the Vevey, Switzerland-based company said in a statement Thursday. Analysts expected 3.7 percent. Nestle reiterated that it expects full-year organic revenue growth to be similar to last year’s 4.2 percent.
“We also expect pricing, which reached historically low levels in the first half, to recover somewhat in the coming months,” Nestle Chief Executive Officer Paul Bulcke said in the statement.
The maker of Nespresso coffee is facing spreading deflation across Europe as consumers pare spending. Chief Financial Officer Francois-Xavier Roger has said the company expects a better second half, boosted by more favorable comparisons and higher prices in some emerging markets such as Brazil and Russia.
In June, Nestle appointed Fresenius SE’s Ulf Mark Schneider as successor to Chief Executive Officer Paul Bulcke. He’s joining next month and will take the CEO role on Jan. 1. Schneider’s background is in the medical industry, supporting Nestle’s shift towards nutrition and health in a quest for faster growth. Nestle is heading for a fourth consecutive year of missing its long-term target for average organic revenue growth of 5 percent to 6 percent.
Nestle also repeated it aims to achieve improvements in margins and underlying earnings per share in constant currencies.
Unilever has reported second-quarter sales growth that beat estimates as it sold more deodorants and haircare products. Growth remained steady with the first quarter, yet the gains came mostly from higher prices for its goods as sales volumes slowed. Danone’s first-half earnings beat estimates as a revamp of Actimel and Danonino and higher-priced products offset lower-than-expected volume.
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