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TRANSCRIPT
Welcome to the Nine-Month Sales Conference
Paul Bulcke Nestlé CEO
Nine-Month Sales Conference
2011 2010 2012
17 October, 2013 Nine-Month Sales Conference 3
2013
Wan Ling Martello Chief Financial Officer
Nine-Month Sales Conference
Disclaimer
This presentation contains forward looking statements which reflect Management’s current views and estimates. The forward looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward looking statements. Potential risks and uncertainties include such factors as general economic conditions, foreign exchange fluctuations, competitive product and pricing pressures and regulatory developments.
5 17 October, 2013 Nine-Month Sales Conference
Highlights
• Sales up 4.0% to CHF 68.4 billion
• Organic growth of 4.4%
• Real Internal Growth 3.0%
• All geographies contributing to positive growth
• Outlook confirmed: around 5% organic growth with an improvement in margins and underlying earnings per share in constant currencies
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Operating Segments
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0.7
5.2 5.6
2.0
6.6 5.6
2.1 1.5
5.1
2.1
4.0 4.4
ZoneEurope
ZoneAmericas
ZoneAOA
NestléWaters
NestléNutrition
Other
5.7 Sales CHF bn rounded
14.1 9.0 7.5 20.8 11.4
% RIG % OG
Product Categories
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5.0 4.4
0.5
6.1 6.9
5.0
2.3
0
3.5 3.9
Powdered &Liquid Beverages
Milk Products& Ice Cream
Prepared Dishes& Cooking Aids
Confectionery PetCare
10.3 8.3 7.2 13.2 15.0 Sales CHF bn rounded
% RIG % OG
Regional Performance
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0.9
5.1
6.9
1.9 2.0
5.8
Europe Americas AOA
18.7 29.6 20.0 Sales CHF bn rounded
% RIG
% OG
Each region includes Zones, Nestlé Waters, Nestlé Nutrition, Nestlé Professional, Nespresso and NHSc,
Europe
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Region* Sales CHF 18.7 bn OG 0.9% RIG 1.9%
Zone Sales CHF 11.4 bn
OG 0.7% RIG 2.1%
*Figures include Zones, Nestlé Waters, Nestlé Nutrition, Nestlé Professional, Nespresso and NHSc
Americas
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*Figures include Zones, Nestlé Waters, Nestlé Nutrition, Nestlé Professional, Nespresso and NHSc
Region* Sales CHF 29.6 bn OG 5.1% RIG 2.0%
Zone Sales CHF 20.8 bn
OG 5.2% RIG 1.5%
Asia, Oceania & Africa
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*Figures include Zones, Nestlé Waters, Nestlé Nutrition, Nestlé Professional, Nespresso and NHSc
Region* Sales CHF 20.0 bn OG 6.9% RIG 5.8%
Zone Sales CHF 14.1 bn
OG 5.6% RIG 5.1%
Summary • Broad based performance – all regions and
categories contributing
• Growth momentum continues
• Outlook confirmed: around 5% organic growth with an improvement in margins and underlying earnings per share in constant currencies
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Paul Bulcke Nestlé CEO
Enhancing our competitiveness to drive performance
12.5 12.6 12.9 13.5
14.0 14.3
14.6 14.8
14.4 15.0 15.2
5.1 4.5
6.2 6.2 7.4
8.3
4.1
6.2
7.5
5.9
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Delivering over time Nestlé Model
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10 year Average
OG + 6.1%
EBIT (in % NPS) TOP margin (in % NNS)
Our ambition is to be the leader in Nutrition,
Health and Wellness, and the reference
for financial performance, trusted by all stakeholders
Our ambition is to be the leader in Nutrition,
Health and Wellness, and the reference
for financial performance, trusted by all stakeholders
Operational pillars
Consumer
engagement
Presence
Operational efficiency
Innovation
Growth drivers
Nutrition,
Health and Wellness
Emerging
Consumers
Out-of-home
Premiumisation
Competitive advantages
Worldwide presence
People
Portfolio
Research and development
Our Roadmap Driving performance
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New Reality Many challenges
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17 October, 2013 Nine-Month Sales Conference 18
New Reality Many opportunities
Embrace digital Have the best people
Make choices
Value what consumers value
Expand the boundaries of nutrition
Our priorities
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Grasp opportunities
Engage with the community and stakeholders
Mastering complexity
Allocating resources
Strengthening portfolio
Focus on…
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Mastering complexity
Allocating resources
Strengthening portfolio
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Focus on…
R&D and Innovation
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60/40 +
M&A
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Portfolio management
2000
2010 2011 2012 2001
Acquisitions
Divestitures
2004 2012 2010
2007
2009 2003
South Africa
Strengthening portfolio
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1800 cells • Products • Brands • Categories • Markets
• Strategic fit • Profitable
growth • Resource
intensity
Portfolio management
Scope
• Invest ? • Fix ? • Divest ?
Criteria Decisions
Drive returns
Mastering complexity
Allocating resources
Strengthening portfolio
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Focus on…
Investing for growth Capabilities
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Investing for growth Capacities
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A strong global presence
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Illustrative R&D Factories Factory: new/expansion New R&D
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Capital Expenditure Return
5%
Mastering complexity
Allocating resources
Strengthening portfolio
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Focus on…
Mastering complexity
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GLOBE, NCE, NBS,…
Category
Globally Managed Businesses
Nestlé Nutrition
Nestlé Professional
Nespresso
Nestlé Waters
Separately governed operations
Nestlé Health Science (NHS)
Joint Ventures F&B: CPW (Cereals), BPW (Beverages)
Joint Ventures Pharma: Galderma, Inneov
Powdered and Liquid Beverages
Water
Milk products and Ice cream
Prepared dishes and Cooking aids
Confectionery
PetCare
Nutrition and HealthCare
Geography
Europe Americas Asia Oceania Africa
Mastering complexity
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From size... to scale… to competitive advantage
Mastering complexity
Allocating resources
Strengthening portfolio
Enhancing our competitiveness to drive performance
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Enhancing our competitiveness to drive performance
Appendix
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Weighted Average Exchange Rates
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CHF per 9m 2012 9m 2013 (%)*
US Dollar (1) 0.94 0.94 -0.5
Euro (1) 1.20 1.23 +2.3
£ Sterling (1) 1.48 1.45 -2.6
Real (100) 49.06 44.29 -9.7
Mex. Peso (100) 7.11 7.38 +3.8
Yen (100) 1.18 0.97 -18.1
* % rounded
FX Impact on All Businesses
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(%) 1Q 2013 HY 2013 9m 2013
Zone Americas -2.6 -2.4 -4.4
Zone Europe +1.2 +1.3 +0.9
Zone AOA -1.0 -1.4 -3.7
Nestlé Nutrition -1.9 -1.8 -3.9
Nestlé Waters +0.9 +0.8 -0.4
Other +0.2 +0.3 -1.0
Total -0.9 -0.9 -2.5