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Nestle CFO: ‘More to be done’ in North America

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Nestle CFO: ‘More to be done’ in North America

BOSTON — Nestle SA has “more to be done” in its North America business after a disappointing second quarter, said Anna Manz, chief financial officer.

In a Sept. 8 presentation at the Barclays Global Consumer Staples Conference in Boston, Manz said that while the consumer environment in North America has been weak, it was not the driver of the company’s poor performance in the region. Instead, she pointed to two key factors.

First, weak category growth in frozen food.

“There, the category as a whole is in slight decline,” Manz said. “It plays to the more challenged area of the consumer. Equally, there are big pockets in that category that are growing much faster. And the sorts of trends that — where we’re seeing that faster growth is around world cuisine, around high fiber, high protein, around actually the very small pack sizes or the single pack sizes and then the big family value packs.

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“So it’s about making sure that we’re playing in the right places in the category to really take advantage of the growth that is there.

“We are doing a better job of that. Our performance is improving. There is more to do to be consistently growing.”

The second area of concern involves the company’s Gerber brand and creamers.

In the case of Gerber, Manz said it “is a journey to turn that around.”

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She said Nestle will have a better idea of how Gerber is doing once first-quarter shelf resets take effect. The company’s move to add new formats and flavors to reach new demographics is expected to help the brand regain shelf space once annual shelf resets take place.

Creamers also has been a trouble spot, with Manz acknowledging that “that one annoys me.”

“It annoys me because some of our issue in the quarter was production, and that really isn’t acceptable,” she said. “So we’ve made the interventions there, really good momentum on the fast-growing part of the category. A bit more to do on Coffee Mate, but good progress.”

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