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MarketScreener Homepage  >  Equities  >  Swiss Exchange  >  Nestlé S.A.    NESN   CH0038863350

NESTLÉ S.A.

(NESN)
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Nestlé to Refresh Bottled-Water Business as Sales Turn Flat

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10/17/2019 | 07:45am EST

By WSJ City

Nestlé said it would overhaul its struggling bottled-water arm, hoping to reinvigorate growth in a business grappling with rising competition, high costs and growing concerns about single-use plastic.

KEY FACTS

--- Its water arm will go from being a stand-alone to one managed locally in Nestlé's various regions.

--- Nestlé Waters employs 28,000 people. A spokesman declined to comment on whether there would be job losses.

--- In the water business, revenue was flat over the nine months, while volumes dropped 2.2%.

--- The head of Nestlé Waters, Maurizio Patarnello, will leave the company by the end of the year.

--- The change mimics a restructuring in the infant nutrition arm where the company says results have improved.

--- Sales in the nine months ended Sept. 30 were 68.37bn Swiss francs, up from 66.42bn francs year-on-year.

Why This Matters

Water is a "problem category" for Nestlé, said Jefferies analyst Martin Deboo earlier this month, saying the business is losing share to rivals in the US, its biggest market. The company backed its 2019 estimates and said it would return 20bn francs to investors over the next few years, primarily through share buybacks. It didn't release profit figures.

Since taking over in 2017, CEO Mark Schneider has tried to focus energies on a handful of core businesses he views as high-growth. Water is one of these, along with nutrition, pet food and coffee.Meanwhile, the company has faced scrutiny from activist investor Daniel Loeb to improve its financial performance and sell its stake in L'Oréal.

WSJ City: The news, the key facts and why it matters. Be deeply informed in less than five minutes. You can find more concise stories like this on the WSJ City app. Download now from the App Store or Google Play, or sign up to newsletters here http://www.wsj.com/newsletters?sub=356&mod=djemwsjcity

A fuller story is available on WSJ.com

Stocks mentioned in the article
ChangeLast1st jan.
LONDON COFFEE -1.07% 1765 End-of-day quote.0.00%
LONDON SUGAR 2.17% 334.5 End-of-day quote.0.15%
NESTLÉ S.A. -0.88% 103.94 Delayed Quote.30.05%
NEW YORK COCOA 1.60% 2675 End-of-day quote.10.58%
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Financials (CHF)
Sales 2019 93 216 M
EBIT 2019 16 458 M
Net income 2019 12 566 M
Debt 2019 27 625 M
Yield 2019 2,57%
P/E ratio 2019 24,7x
P/E ratio 2020 23,7x
EV / Sales2019 3,54x
EV / Sales2020 3,54x
Capitalization 302 B
Chart NESTLÉ S.A.
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Nestlé S.A. Technical Analysis Chart | MarketScreener
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Technical analysis trends NESTLÉ S.A.
Short TermMid-TermLong Term
TrendsNeutralNeutralBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 28
Average target price 111,61  CHF
Last Close Price 104,64  CHF
Spread / Highest target 16,6%
Spread / Average Target 6,66%
Spread / Lowest Target -15,9%
EPS Revisions
Managers
NameTitle
Ulf Mark Schneider Chief Executive Officer & Director
jeff hamilton President
Paul Bulcke Chairman
Magdi Batato Executive Vice President-Operations
François-Xavier Michel Marie Roger Chief Financial Officer & Executive Vice President
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