Nestlé reports stormy revenue statistics amid covid-19 pandemic
February 22, 2021502 views0 comments
By Onome Amuge
Nestlé Group, the Swiss-multinational food and drink processing conglomerate, recorded a decline in its 2020 revenues, which saw the business incur additional global operating costs capped by the covid-19 pandemic.
Despite seeing its organic growth rise three per cent last year, the world’s largest food company reported 8.9 per cent drop in sales revenues at 84.3 billion Swiss franc across its portfolio while net profit amounted to 12.2 billion Swiss franc, down 3 per cent year-on-year, with segments, including its confectionery interests, also suffering a decline in performance.
The company also stated that dealing with the pandemic added a total of 420 million Swiss franc to its costs in terms of bonuses paid to frontline workers, additional employee safety protocols, donations and other staff and customer allowances.
On a positive light, there were encouraging innovations for the year that included the development of its Swiss R&D accelerator centre focusing on plant-based product ranges, a notable advancement within confectionery as its Smarties ranges switched to paper-based packaging, as well as a venture into new territory in producing a new vegan KitKat variety.
Mark Schneider, Nestlé’s chief executive officer, stressed that its digital operations and innovation focus were key to handling the ongoing challenging conditions, as the company achieved a third consecutive year of improvement in organic growth and returns on invested capital. At the same time, he reiterated the company’s focus on sustainability and achieving net zero greenhouse gas emissions by 2050.
“2020 was a year of hardship for so many, yet I am inspired by the way it has brought all of us closer together. I want to thank our employees and our partners – from farmers to retailers – who worked with us to ensure the supply of food and beverages to communities globally,” he said.
Schneider added that the global pandemic did not slow the company as its nutrition expertise, digital capabilities, decentralised structure and innovation engine enabled it to adapt quickly to changing consumer behaviours and trends.
Commenting on expectations for 2021, he assured that the company was committed to advancing its portfolio transformation, building its health science into a nutrition powerhouse and expanding its presence in direct-to-consumer businesses. He also projected continued improvement in organic growth, profitability and capital efficiency in line with the company’s value creation model.