Dog Chow Gains Feed Nestle Sales

Apr 09, 2002

Nestle SA is expected to post an 11 percent rise in first-quarter sales mainly due to the inclusion of sales by U.S. food group Ralston Purina, purchased for $10.3 billion at the end of 2001, reports Reuters. According to a poll of seven analysts, sales at the world’s largest food group will grow to 21.5 billion Swiss francs, up from 19.4 billion a year ago, with acquisitions accounting for approximately seven percent of the rise.

Nestle has offered no earnings guidance for this year, but has said it will
“at least” meet its annual real internal growth (RIG) target — an internal
sales goal stripping out price, currency and acquisition effects — of four
percent. Of interest will be the RIG for Nestle’s US operations after strong
growth in the fourth quarter as well as the performance of its pet care unit,
which now includes Ralston and its brands such as Purina Dog Chow, analysts

Nestle Chief Executive Peter Brabeck-Letmathe said in February that this year’s focus will be consolidation — squeezing synergies out of acquisitions and implementing a number of savings programs.

Moderator Comment: Has the Nestle purchase of Ralston
had any effect on the pet food category? What do retailers need to do to grow
pet related product sales? [George
Anderson – Moderator

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