GENEVA (AP) — Swiss food and drink giant Nestle SA reports its half-year results before the Zurich stock market opens Wednesday.
WHAT TO WATCH FOR: Nestle is still selling more coffee, ice cream and ready meals than its competitors. But because it reports earnings in Swiss francs, the Vevey-based company is expected to post lower first-half net profits than in 2010.
The owner of brands such as Nescafe, Haagen Dazs and Jenny Craig is astute at juggling rising commodity costs, inflation and product prices. In recent months it has made significant acquisitions in emerging markets such China to make up for consumer cutbacks in Europe and the United States.
But Nestle has been unable to escape the effects of the strong Swiss franc, which on paper make it appear to be earning less even though its profits continue to rise in constant currencies.
WHY IT MATTERS: Nestle employs about 280,000 people worldwide and is a major buyer of raw materials. The company's results reflect the state of the global economy and indicate future demand for commodities such as cocoa, wheat, coffee and sugar.
WHAT'S EXPECTED: Analysts at investment firm AllianceBernstein predict half-year net profit of 4.72 billion Swiss francs ($6.17 billion), with sales of 40.9 billion francs.
LAST YEAR'S HALF: Nestle reported a net profit of 5.45 billion francs (then $5 billion) and sales of 47.1 billion francs in the first half of 2010.
No comments:
Post a Comment