Nestle SA said the outlook for revenue growth this year has improved as its big brands thrive, with Purina pet food benefiting amid an increase in pet ownership during the pandemic.
The world’s largest food and beverage company forecast organic sales growth of about 3 per cent this year. That’s after a 4.9 per cent increase in the third quarter, the quickest pace in at least six years. Petcare sales surged 11 per cent, leading gains.
Pet adoptions and fostering are at a record high, Purina said last month. Nestle got more than 10 billion francs (US$11 billion) of revenue from petcare products in the first nine months of the year, making it the biggest category after powdered and liquid beverages, which includes coffee. Over the past decade, petcare has been one of Nestle’s fastest-growing products, and 2020 is set to be the best year for Purina cat and dog chow in years.
Nestle previous targeted sales growth of 2 per cent to 3 per cent. Revenue climbed 3.5 per cent on an organic basis in the nine months through September, beating analysts’ estimates. The stock rose as much as 1.6 per cent.
Purina started selling cat food this year that it says helps reduce allergens, a breakthrough for people who have been told to avoid contact with felines. Allergies to dogs and cats affect as much as 20 per cent of the global population, a 2018 study found. Last year, Nestle rolled out a probiotic that it says can help anxious dogs calm down.
E-commerce surged 48 per cent in the first nine months of the year, making up 12 per cent of total sales. That helped offset a slump in the food-service sector.
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