Two of the industry’s heavyweights – Nestle and Unilever – were in the headlines last week. Nestle admitted it will offload some under-performing brands, while Unilever issued a sales warning amid a slowdown in emerging markets.
“We want to be in business, not in agony” – Nestle CEO Paul Bulcke on the food giant’s decision to scrutinise its portfolio to see which brands could be offloaded.
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“We continue to believe (as does Polman) that the emerging markets continue to offer a long and healthy runway for growth. We do expect some slow-down in growth from the levels seen in 2010-2012, but we conclude that the headline fears that will inevitably come from the Q3 warning should not be extrapolated as a general and rapid deceleration in emerging markets growth” – Sanford Bernstein analyst Andrew Wood after Unilever issued a sales warning on the back of a slowdown in emerging markets.
“The next two, three, four years are going to be difficult years as they have been for Europe but the long-term prospects, in terms of the overall development, I remain cautiously optimistic that there is still a strong amount of potential yet to be fulfilled” – Per Hong, partner for management consultants A.T. Kearney in Moscow, insists the future is bright for Russia despite the recent slowdown in the country.
(For more on our management briefing on Russia, published this week, click here).
“If we thought it would have ended up this way in the first quarter we would have told you. We didn’t expect it to be so bad, but slowly but surely we’re starting to see the benefits” – Tesco boss Philip Clarke reflects on the UK retailer’s operations in Europe, which saw profits slump over 70% in the first half of the company’s financial year.
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By GlobalData“We are investing heavily in the region as the middle class continues to grow and consumers increasingly want chocolate and new confectionery products” – Peter Smit, senior vice president for Hershey’s operations in Asia, Europe, the Middle East and Africa, explains why the US chocolate giant is spending US$250m on a new plant in Malaysia.
“Fonterra confirms that the discussions remain ongoing but strongly denies any legal liability to Danone in relation to the recall” – the New Zealand dairy giant is in talks with customer Danone over the botulism contamination saga that led to some of the French infant formula manufacturer’s brands being recalled.
“There’s a very powerful economic incentive for the industry to get their act together” – Mars chief sustainability officer Barry Parkin tells just-food the chocolate industry should work hard to improve conditions for cocoa farmers.
“Maybe the challenges others have been noting they particularly face with discounters is because they haven’t kept investing in the quality of their own brand” – Sainsbury’s chief executive Justin King says the UK retailer has the private-label ranges to compete with buoyant discounters like Aldi.
“This improved earnings outlook is another reason why WCB is recommending that WCB shareholders reject Bega’s inadequate offer for their WCB shares” – Warrnambool Cheese and Butter Factory CEO David Lord after the Australian dairy processor – a takeover target of local peer Bega Cheese – forecast EBITDA could more than double in its current financial year.
“We have a 20-year history in New Zealand with sales of Black Forest in excess of NZ$18m (US$14.9m) in the last five years – we found it hard to believe, that this market presence didn’t translate to a view that we had an established reputation” – a spokesperson for Mondelez International in New Zealand after confectioner Whittaker’s was allowed to register a trademark for Berry Forest – which the Cadbury is appealing in court.
