14% fall in profits for Nestle

Nestle has reported a fall of almost 14 per cent in first half net profit.

The world’s biggest food company had a net profit of 4.7 billion francs ($AU6.2 billion) in the last half, which has been blamed on the impact of the strong Swiss franc.

Sales were down almost 13 per cent per cent to 41 billion francs for the six months ending June, as the foreign exchange rate had a negative impact of 13.8 per cent.

Nestle chief executive Paul Bulcke said operating is becoming "extremely tough, volatile and competitive," due to economic instability, rising raw material prices and the strength of the Swiss currency.

There was some success for the company, however, Bulcke said.

“We managed to drive growth not only in emerging markets but also in developed countries, especially in Europe," he said.

Europe contributed 7.5 billion francs in sales, 4.1 per cent more compared to the same period one year earlier.

Ice cream has been the most popular item from Nestle in the region.
The company also said France, Italy and Greece all showed growth and demand as did Ukraine and the Adriatic region.

The biggest market for the company, North America, continued its success, with sales up 5.6 per cent off the back of a high demand for pizza.

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