India is recovering faster than anticipated, says Nestle.
(Reuters)
India is recovering faster than anticipated, says Nestle.
With Maggi back on shelves, Swiss FMCG major Nestle on Thursday said its India business is "recovering faster than anticipated" although the performance will continue to impact the company's showing in Asia, Oceania and sub-Saharan Africa (AOA) zone.
"India is recovering faster than anticipated, although it still weighed on the Zone's overall performance...," Nestle SA said in its first quarter results statement.
India comes under the Asia, Oceania and sub-Saharan Africa (AOA) for the company.
It further said: "In India, the Maggi noodles business gained back market share but the business results were still affected by the unfavourable comparatives." Nestle India had relaunched the Maggi instant noodles in November last year after it went off the market for five months after a ban by central food safety regulator FSSAI over alleged presence of lead beyond permissible limits.
The company had challenged the ban in Bombay High Court, which overturned the ban while ordering fresh test in accredited labs.
In the latest development, the Central Food Technological Research Institute (CFTRI) had cleared the Maggi instant noodles.
Nestle reported sales of 20,934 million Swiss Franc in the first quarter of 2016 as against 20,918 million Swiss Franc in the same period last year.
Commenting on the results, Nestle CEO Paul Bulcke said: "As anticipated, the first quarter continued the positive momentum in real internal growth, with softer pricing. We gained market share in the majority of our categories and businesses."
"The strongest performances were in Europe, in South East Asia and in Africa as well as for Nescaf , Nespresso and petcare," he said.
In AOA zone, Nestle had a sales of 3,554 million Swiss Franc in January-March quarter of 2016.
India is an important market in the AOA zone, which also includes China, Indonesia, Malaysia and Philippines.
While in China, Nestle got good contributions from Nescafe soluble and ready-to-drink coffee, confectionery and culinary.
South East Asia delivered high single-digit growth and markets as Vietnam and Indonesia performed well. Japan and Oceania had a solid start to the year with a strong performance of Nescafe in Japan, it added.