1st Quarter Results

RNS Number:8300X
Nestle SA
21 April 2004



                           Nestle - 1st Quarter 2004:

                      Sales in Swiss Francs Up 3.5 percent
                           Organic Growth 5.1 percent





*      Organic growth within target range, at 5.1 percent

*      Real internal growth of 3.4 percent reflects strong volume growth in the
       Americas, as well as Zone Asia, Oceania and Africa

*      Good start underlines confidence in achieving 2004 objectives



Peter Brabeck, CEO of Nestle, said: "The Group has, as forecast, accelerated
real internal growth to 3.4 percent, while pricing contributed at a more normal
level of 1.7 percent. Growth was particularly strong in Zone Americas and in
Zone Asia, Oceania and Africa. Nestle Waters was off to a challenging first
quarter, but we are confident that it will see an acceleration in the months to
come. Product-wise, the best performances were achieved by PetCare, Coffee, Milk
products, Nutrition and Ice Cream, as well as by Alcon. The good start into 2004
should allow us to attain our objectives for the year, both in terms of growth
as well as profitability."





Vevey, April 21, 2004  -  The Nestle Group's consolidated Swiss franc sales for
the first quarter of 2004 amounted to CHF 20.4 billion, an increase of 3.5
percent over the comparable period of the pre-ceding year. Organic growth
improved to 5.1 percent, with real internal growth of 3.4 percent and a more
normal pricing level of 1.7 percent. Divestments, net of acquisitions, reduced
reported sales by 1.3 percent, reflecting mainly the sale of the low-margin
beverage distribu-tion business Trinks in Germany. The negative foreign exchange
impact was only 0.3 percent.


Sales by Management Responsibilities and Geographic Area

                       Jan.-March       Jan.-March    Organic Growth      Real Internal Growth
                         2004             2003       Jan.-March 2004          Jan.-March 2004
                             in CHF million                  %                        %
Zone Europe *            6'886            6'606            +0.4                    -0.7
Zone Americas            6'302            5'978            +8.0                    +4.7
Zone Asia, Oceania       3'472            3'291            +7.1                    +5.5
and Africa
Nestle Waters            1'810            1'719            +2.4                    +3.4
Other Activities **      1'939            2'119            +11.1                   +10.2
Total                    20'409           19'713           +5.1                    +3.4

*    2003 sales re-stated because of Eismann.

**  Mainly pharmaceutical products and joint ventures; Eismann, a frozen food
distributor, has been moved from Zone Europe to Other Activities, because it is
under a new management due to its planned divestiture.


Zone Europe was off to a slow start, reflecting primarily a difficult retail
environment in Nestle's three most important markets. Zone Americas developed
well, pushed by double-digit increases in Mexico, the Bolivarian region and in
PetCare. Asia took off strongly, with significant growth recorded in Indo-china,
China and the Middle East, as well as in most of the smaller markets. The water
business had a slow start, mainly because of the comparison effect resulting
from an exceptionally strong first quarter in 2003 in the US, due to pre-war
stockpiling. Planned product launches in Europe and normal growth in the US will
improve the performance of the water business in the coming months. The
breakfast cereal joint venture and Alcon delivered a very strong first quarter
with double-digit organic growth.


Sales by Product Group
                             Jan.-March      Jan.-March   Organic growth       Real Internal Growth
                                2004            2003      Jan.-March 2004          Jan.-March 2004
                                    in CHF million              %                      %
Beverages                      5'019            5'162          +3.1                 +3.3
Milk/Nutrition/Ice Cream       5'338            4'865          +7.6                 +4.1
Culinary                       3'938            3'856          +2.0                 +0.7
Chocolate/Confectionery        2'428            2'365          +1.9                 -0.1
PetCare                        2'385            2'257          +9.1                 +6.8
Pharma                         1'301            1'208          +10.9                +10.2
Total                          20'409           19'713         +5.1                 +3.4





Among the product groups, PetCare did particularly well, as Nestle Purina's
management shifted from successful integration to renewed innovation. Chilled
Culinary products advanced strongly, as did Milk products, Nutrition and Ice
Cream. In the Beverage business, Soluble Coffee performed well and Nespresso
recorded a significant advance. In Chocolate and Confectionery, growth improved
from Q1 2003, and management measures for further improvement are being
implemented and should yield results in the second half of this year.



Nestle continues to look forward to the coming months with cautious optimism. It
expects the improving economic climate in several regions to benefit consumer
confidence. Real internal growth, bolstered by innovation and Nestle's strong
brands, will be the driving force behind organic sales growth. The Group in 2004
is again focused on further margin and cash flow improvement and, barring major
unforeseen events, Nestle expects to be able to report positively as the year
progresses.








                      This information is provided by RNS
            The company news service from the London Stock Exchange
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