Nestle SA reported Thursday higher profit in its fiscal 2023, despite weak sales. Organic sales were higher, and the company projects organic growth in fiscal 2024 sales, with a moderate increase in margin. The Swiss food and beverage giant further confirmed fiscal 2025 outlook, expecting growth, and also lifted dividend.

Nestle shares were losing around 4 percent in the morning trading in Switzerland.

Mark Schneider, Nestlé CEO, said, “Unprecedented inflation over the last two years has increased pressure on many consumers and impacted demand for food and beverage products. In this challenging context, we delivered strong organic growth and solid margin improvement with increased marketing and other growth investments….. Looking to 2024, we are prioritizing volume- and mix-led growth with increased brand support…”

The company said its Board of Directors will propose a dividend of 3.00 francs per share at the Annual General Meeting on April 18, an increase of 5 centimes.

Looking ahead for fiscal 2024, Nestle projects expect organic sales growth around 4 percent and a moderate increase in the underlying trading operating profit margin. Underlying earnings per share in constant currency is expected to increase between 6 percent and 10 percent.

Further ahead, the company confirmed its 2025 mid-term targets, still expecting mid single-digit organic sales growth and an underlying trading operating profit margin range of 17.5 percent to 18.5 percent by 2025. Underlying earnings per share in constant currency is projected to increase between 6 percent and 10 percent.

In fiscal 2023, net profit increased 21 percent to 11.21 billion Swiss francs from last year’s 9.27 billion francs.

Earnings per share increased to 4.23 francs from 3.42 francs a year ago. Underlying earnings per share edged up 0.1 percent to 4.80 francs.

Trading operating profit grew to 14.52 billion francs from last year’s 13.20 billion francs. Trading operating profit margin improved to 15.6 percent from 14.0 percent last year.

The underlying trading operating profit margin was 17.3 percent, increasing by 20 basis points on a reported basis and by 40 basis points in constant currency.

Total sales were 93.0 billion francs, a decrease of 1.5 percent from last year’s 94.42 billion francs. Foreign exchange decreased sales by 7.8 percent. Real internal sales were down 0.3 percent.

Organic growth reached 7.2 percent, with pricing of 7.5 percent. Growth was broad-based across geographies and categories.

In Switzerland, Nestle shares were trading at 95.55 francs, down 3.6 percent.

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