2008 hy roadshow presentation - final [read-only] · digital media: increased share in adspend...

1 2008 Half-Year Roadshow – September 2008

James Singh

CFO

2008 Half-Year Roadshow


Disclaimer

This presentation contains forward looking statements which reflect Management’s current views and estimates. The forward looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward looking statements. Potential risks and uncertainties include such factors as general economic conditions, foreign exchange fluctuations, competitive product and pricing pressures and regulatory developments.


Creating Shareholder Value through Profitable Growth

Ø Successful delivery of the Nestlé ModelOrganic growth above LY and the Company’s long term targetEBIT margin above consensus

Ø Food & Beverages the driver of growth & profitability

Ø Billionaire brands driving growth

Ø Corporate & business initiatives moving rapidlyDrive for efficiency with speed & disciplinePartial Alcon sale, smaller disposals, buyback

Improved OutlookOrganic growth at least at 2007 level Improved EBIT margin: reported and constant currencyIncreased pace of share buyback


A strong first halfDelivering the Nestlé Model

+ 3.8 %+ 8.9 %

+ 6.1 %+ 30 bp+ 60 bp

+ 6.1 %+ 20 bp+8.6%

+ 4.0 %+ 8.9 %

+ 6.7 %+ 30 bp+ 50 bp

CHF 53.1 bn

CHF 7.3 bn13.8 %

CHF 5.2 bn9.8 %

CHF 1.39

CHF 49.3 bn

CHF 6.1 bn

+ CHF 2.0 bn

+ CHF 0.4 bn

+ CHF 0.3 bn

+ CHF 1.9 bn

+ CHF 0.4 bn

GroupSales – totalOrganic growth

EBITEBIT marginConstant currency

Net profitNet profit marginEPS

Food & BeveragesSales – totalOrganic growthEBITEBIT marginConstant currency

Improvements HY 08 v HY 07 HY 08 Total


Total Food & Beverages* All geographies contribute well

* each region includes sales of Food & Beverages, Nestlé Waters and Nestlé Nutrition businesses, Nespresso and F&B JVs

x.x

2.03.0

5.85.2

9.9

14.2

0

2

4

6

8

10

12

SalesCHF bn

Europe19.0

Americas20.5

Asia, Oceania, Africa9.8

% RIG

% Organic Growth%

Gro

wth

14

16


Secondary Reporting: Progressing in all categories bar Waters

Dairy products inc. Ice Cream

Powdered & Liquid Beverages

NestléWaters

NestléNutrition

Prepared Dishes & Cooking Aids

Confectionery PetCare Pharma

% RIG% Organic growth

% G

row

th

9.4

-3.1

1.8

5.5

0.91.7

5.4

8.5

14.0

-1.1

12.011.1

5.4

7.7

10.9

9.6

0

2

4

6

8

10

12

14

-2

9.0 4.9 10.3 5.2 8.6 5.4 5.9 3.7SalesCHF bn


2008 Half-Year ResultsKey factors of margin improvement

EBIT marginH1 2007

COGS Distribution Marketing R&D EBIT marginH1 2008

13.5 %

+ Efficiencies+ 5.4% Pricing+ Mix- Input costs

-190

GROUP EBIT MARGIN + 30 bp (+ 60 constant currency)F&B EBIT MARGIN + 30 bp (+ 50 constant currency)

13.8 %

+ 6.1 %+70

+120

Admin.

+30

+60Constant currency

+ Efficiencies + Mix+ Leverage/Fixed costs+ Pricing

+30


High-quality results

Ø Strong operational performance

Ø High quality – achieved whilst continuing to invest in products & brands, R&D, new distribution channels and business models

Ø Unmatched brand strength, R&D and significant presence & competitiveness in the numerous economies of the world

Ø Performance driven by focus and discipline in the execution of our strategy, while at the same time managing the external impacts on the business

Ø Nestlé is uniquely positioned, resilient, with capabilities to create and capture opportunities for continuous growth


Ø Operational efficiency

Ø Innovation & Renovation

Ø Consumer communication

Ø Whenever, wherever, however

The Four Pillar Strategy


Efficiencies in Marketing Spend

Ø For Nestlé, total Marketing Expenses include: Trade Spending, Media and Consumer Promotions, Sales Force and Marketing Personnel and Administration

Ø Consumer Communication – or direct to consumer expenditure is an important part of our marketing spend

Ø Careful and astute deployment of funds in support of fewer and stronger brands, building value-added relationships with consumers, provide significant opportunities for gaining efficiencies in this spend category

Ø Examples of coordinated activities ~ contributing to efficiencies in Marketing Spend


Marketing at Nestlé

Ø Leveraging central resources

Ø Efficiency through leverage:Ø Investment behind Billionaire Brands

Ø Development of Communication Platforms

Ø Efficient and effective use of all communication channels

Ø Increased use of digital media:Ø Engaging consumers in long-term relationships with our brands

Ø Enabling consumers to generate content and to become an effective media channel

Ø Measuring progress and retaining benefits from key learnings, to achieve higher levels of effectiveness


Ø Global & Strategic Business Units (SBUs) – “The What”Ø Brand owners with the longer term viewØ Creating & managing the global Brand EssencesØ Providing Strategic direction – Innovation – Creative content

Ø Strategic Generating Demand Unit (SGDU) – “The How”Ø Functional expertiseØ Management of communication partnersØ Proprietary process for communication developmentØ Consumer Research, Brand Equity Measurement

Sharing best practices and driving efficiencies, enhancing the impact of in-market communications activities

Leveraging central resources


Ø Billionaire brands have stronger consumer equity across multiple product categories and formats

Ø Communication Platforms enable more efficient and effective use or resourcesØ Three examples, now being replicated in numerous markets – leveraging best

practice

Efficiency through leverage


Nescafé “Savour Every Moment”

Scope: Worldwide, led by Coffee & Beverages SBUBrand & Country: Nescafé, MexicoCampaign: “Savour Every Moment”, 2007 – 2008Objective: To build Nescafé’s Brand equity while reinforcing the

concept of a special cup of coffee for every moment

RELAX-


Leveraging Billionaire Brands: Nescafé

Execution in Bus Shelters


Consistent communication out-of-store, in-store and on-line

Results: Ø 7% RIG across the rangeØ 11% OG increase across the rangeØ Media efficiencies of 6%Ø Overall Nescafé Brand Health KPI « Favourite Brand » increased from 2%

to 32% vs previous year. Top of Mind from 20% to 44%

Leveraging Billionaire Brands: Nescafé


Scope: RegionalBrand & Country: Maggi, Middle EastCampaign: “Go Create”, 2008Objective: To attract/remind consumers to cook with

Maggi through Ramadan (peak season for the category), through a emotionally engaging, 360 degree campaign

Build Communication Platforms: Maggi



Personal involvement, simple, versatile, convenient: leveraging an important moment in life


Print

Delivery Trucks

Outdoor

Internet Cooking Club

Nutritional Compass

POS


Results: Ø 8% RIG Ø Maggi overall Brand Health KPIs improved by 10%, including

95% Brand Recognition and 72% Confirmed Purchase Intention


Digital Media: increased share in adspend

Nestlé broadly in-line with trend:Digital an increasing part of spend

ØMedia evolving - highly dynamic: reaching the consumer any time, any where

ØTelevision still dominant but rapid expansion of internet/new media is putting the consumer in control

ØSearch and Content are key areas of Nestlédevelopment

0%

20%

40%

60%

80%

100%

2000 2007 2010

InternetOutdoorRadioTelevisionMagazinesNewspaper

Global adspend share by mediumUS$ mio, current prices


Scope: LocalBrand & Country: Multi-brand, corporate Campaign: “Croquons la Vie”, FranceObjective: To maintain long-term relationships with most valuable

Nestlé consumers, leveraging digital as the key two-way communication medium

Digital Media: Multi-brand initiatives


Consumer Services Call Center

Magazine

Website

Cooking sessions

e-Newsletter

Tasting sessions

Leveraging Digital & off-line : Croquons la Vie

NutritionalCompass


2007 2008MembersControl Gp

+20%

Members Control Gp

Additional Sales

For Nestlé

Spendper Offline household

Spendper Online household

Digital Media: Croquons la Vie

Results

+9%

+25%

X 2X


Measuring Progress

ROI Tracker

Key Partners

25 2008 Half-Year Roadshow – September 2008Source: Millward Brown Inc.

Ø Effectiveness of advertising message / content: Pre-testing

Measuring the Message

PE

RS

UA

SIO

N

IMPACT

Risky

Risky


100.0 100.089.2 90.8

80.7 81.3

0

20

40

60

80

100

120

2007 2008

Avg. market Top advertisers Nestlé

Ø Efficiency of media planning and buying

Measuring the Media

Cost of Media Index, Russia example

Nestlé achieved a better media cost vs industry

100 GRPs 100 GRPs


100.0 100.0 100.095.7

113.0 117.0

0

20

40

60

80

100

120

140

Cost Quality Overall

Avg. Top Advertisers Nestlé

Ø Effectiveness of media planning and buying

Measuring the Media

Cost of Media Index

Nestlé achieved a better performance both in terms of efficiency and quality of our media buying

Cost Index Overall ratingBetter programming

2007


Ø Market ShareØ Measures overall ROI

Ø Brand HealthØ Diagnosis: What are the drivers of

Market Share?Ø Longer term vision vs Market Share

Ø Retail and HouseholdØ In-store performance: competitive

analysisØ Purchase dynamics in our

consumers homes

KPI Measurement: Return on Investment

ND 07

Nestlé Brand B Nestlé Brand C Nestlé Brand D

P A T H T O L O Y A L T Y / A D V O C A C Y

Base: Product Category Users & Shoppers

Advocacy

Loyalty

Repurchase

Trial

Consideration

100

1

91

Awareness6084

2

98

19

70

58

86

84

650

Sample=42000

Nestlé Brand A

5

88

94 6775

4

3

25 77

9391

88

14

16

17

69

76

90

3

3

4

21

30

50

36

42

50

86

88

97

20

40

60

78

84

96

32.233.233.132.831.731.3Av price/kg302926272523Share Of Seg %8.99.18.18.27.36.1Share Of Total %P6P5P4P3P2P1Brand: Xyzz

Key Retail Metrics

12.21211.711.3Freq of Purchase – p/a35373533H'Hold Penetration %

17.918.217.316.1Share of Buying %Q4Q3Q2Q1Brand: Xyzz

Key Household Metrics


KPI Measurement: Brand performance


Ø Four competitive advantages

Ø Four growth accelerators

Ø Four Pillar strategy

Beyond 2008: Nestlé is opportunity-rich


Ø Product and brand portfolioBillionaire brandsFast-growing, added-value categories

Ø The industry's leading R&D capabilityCHF1.9 billion spendOpen innovation; 8 benefit platformsLocal presence – Access to local top talent, increased awareness in local tastes/preferences

Ø Unmatched geographic presenceCHF35 billion in emerging marketsHigher than average growth & profitability

Ø People, culture, values, attitudeCulturally diverse, strategically aligned, Performance focused, with shared values

Beyond 2008: Four competitive advantages


Ø Nutrition, Health & WellnessNestlé Nutrition – world leaderApplicable to all product groups

Ø Leadership in "out of home"$400 billion marketNestlé Professional: No.1 branded player

Ø PremiumisationApplicable to all product groupsHigh growth, high margin

Ø Emerging markets & PPPPPP – a $70 billion opportunitySpecific business models & products

Beyond 2008: Four growth accelerators

Scale, skills and diversification ~ integral to sustained profitable growth

In Home

Out of Home

Premiumisation

PPP


Ø Operational efficiencyTotal performance managementNestlé Continuous Excellence

Ø Innovation & RenovationConsumer focused differentiation60/40+ for Nutrition, health & wellness

Ø Consumer communicationCreative & resonantEffective & efficient

Ø Whenever, wherever, howeverTop 10 CustomersTraditional retailOut-of-homeFrom home (www)

Beyond 2008: Four Pillar Strategy

51.8%

COGS in% of NPS

COGS in% of NPS

0.6 Cumulative cost improvements

Cumulative cost improvements

1.32.2

3.1 4.05.2 6.4 7.6 8.7

41.4%

9.8 10.8

41.9%


The Nestlé Investment Proposition“The Nestlé Model” – for the next 10 years

1. Long-Term Organic Growth Target 5 - 6%

Resulting in an industry outperforming, long-term total shareholder return

Making NestléThe Reference for Financial Performance

2. Continued year after year improvement of EBIT margin

3. Improving Capital efficiency / Business ROIC / Cash returns to shareholders

EBIT

Sales


James Singh

CFO

2008 Half-Year Roadshow


Zone EuropeZone Europe

Luis CantarellExecutive Vice President Nestlé S.A. - Zone Europe


NestlNestléé in Europein Europe

Europe at a GlanceEurope at a Glance

H1 2008 PerformanceH1 2008 Performance

20082008--2011: Sustainable Profitable Growth2011: Sustainable Profitable Growth


Zone Europe

In summary...

Ø Europe: a growth opportunity

Ø Performance is on track

Ø Potential for continued growth is promising

Ø Aligned organisation and portfolio with a vision and a plan

Ø Strong management with local expertise

Nestlé Europe: sustainable and profitable growth


770 mio Consumers12% of World Population

Over 40 States / 50 Languages

Western Europe:395 million Consumers

Central and EasternEurope:

375 millionConsumers


Category specific trends

Multi packs

Coffee on demand

Single serve

Microwaveability

Low fat

Super-PremiumIce Cream

Naturalingredients

“My Cup”

Premium Chocolate

Dark & Gifting

Nibbling &small bite

sizes

Consumer Needs

Convenience / Add value /New routes to consumer

5

Nature/Freshness/Organic/

Origin1

Nutrition/ Health/

Wellness

2

Pleasure/Indulgence

3

Older & smaller HouseholdsUrbanisation Polarisation

Less time/culinary competenceSustainability

Socio-Demographics

Tastiness 4

Origin, Fair Trade

Source: F&C-EUR; Cells Navigators 2008

Consumer needs driven by socio-demographic changes


4.03

5.74 5.86

6.386.69

7.19

2

3

4

5

6

7

8

Forecourts Hypers Supers C-stores Cash & Carries Discounters

Perc

enta

ge

CAGR 2007 - 2013

Source: Planet Retail Ltd – www.planetretail.net

Trade concentration to continue

Channel Growth 2007-2013 (%)

The Zone has been achieving above average growth with key customers & discounters

http://www.planetretail.net


Nestlé in Europe

Zone EuropeGlobally Managed

BusinessesMarkets/countries European

businesses

Leverage Nestlé’s scale through GLOBE, Nestlé Business Services

Ø BeveragesØ ConfectioneryØ CulinaryØ (Food Services)Ø Ice Cream

Ø Petcare Ø Nestlé WatersØ Nestlé ProfessionalØ Nestlé NutritionØ NESPRESSO

Globally managed

Regionallymanaged

Locallymanaged

Nestlé in Europe: Operating Model


Nestlé Food & Beverages in Europe- CHF 39 bio in 2007 -

JV(CPW/BPW) 3%

Nespresso 4%

Nestlé Nutrition 6%

Nestlé Waters 12%

Zone EUR 74%


Zone Europe Sales by Categories 2007

(All Channels)

R&G Coffees 2%

Shelf stable Dairy 2%

Powdered Beverages 2%

Culinary Chilled 7%

Frozen Food 11%

Ice Cream 10%

Petcare 14% Culinary 15%

SolubleCoffees 17%

Confectionery 20%


All regions driving growth and profitability

Western Europe

2.0%

EBIT

Central & Eastern Europe

Total Zone Europe 12.0%

13.9%7.5%

11.7%1.2%GermanyFrancePetcare EuropeGB Region

1.8%1.7%2.7%0.4%

Russia and Eurasia RegionPoland

6.9%11.0%

28'464

3'988

24'4764'9004'5003'9003'200

1'600700

RIGSales OrganicGrowth

1.6%

12.4%

3.0%

2007


Continuous growth…

Growth in Key markets driven by:Ø The strength of the Nestlé BrandsØ Clear priorities for innovationsØ Above average growth with top customers & Discounters

-1.2-0.2

0.1

2.01.4

2.3 2.03.0

2.3

5.8

-2.0-1.00.01.02.03.04.05.06.0

2004 2005 2006 2007 H1 2008

RIG OG


Growth at constant exchange ratesH1/08 vs H1/07

Z-EUR Organic Growth

Z-EUR withtop customers*

Z-EUR withkey discounters**

5.8%

6.4%

13.7%

* Z-EUR top 10 customers** NPS with key discounters Lidl, ED/Dia, Mercadona, Netto/Edeka, Denner, Netto/Dansk Supermarked,

Penny (excl. Germany), Netto/ITM

Strong performance with our key customers and discounters


Improving profitability

Growth and efficiencies – key drivers of improved performance

10.9

11.4

11.7

10.4

10.6

10.8

11.0

11.2

11.4

11.6

11.8

H1 2006 H1 2007 H1 2008

EBIT % - June 2008


H1 2008 Key factors of margin improvement

11.4%

EBITH1 2007 COGS

Distribution Marketing EBITH1 2008

Admin /Structural costs

Ø Operation ExcellenceØ MixØ Input costs

- 40 bps - 10 bps

+ 90 bps

Ø Nestlé Business Services

Ø GrowthØ Efficiencies

Media % up 30 bps

11.7%

EBIT MARGIN + 30 bps (+ 40 bps at constant currency): Margin improvement driven primarily by growth and reduction of structural costs

+30 bps

- 10 bps

Cost efficient and service-driven backline operations enable our businesses to remain

focused on objectives


Adapting our structures to business environment

Ø 42 factories closed / sold (3 in 2007) Ø CHF 1.2 Bio spent in restructuring

(CHF 180 mio over the last 18 months)

Our commitment is to focus on profitable growth

2003 – 2007

2008 Ø Focus on growing businessØ Focus on delivering return on investment


+30 bps Improvement

2005 2006 2007 H1 2008

Average Trade Net Working Capital (TNWC) consists of Trade receivables, Inventories and Trade payables. Calculation is based on a rolling average of the 5 last quarters period-ends.

Discipline in Working Capital management

Average Trade Net Working Capital (in % of Sales)

12.9%

12.5%

11.2%

10.9%

8.0

9.5

11.0

12.5

14.0


Above Average• Soluble Coffee-NESCAFÉ System• Powdered Beverages• Ambient Culinary • R&G Coffee• Ambient Dairy

Below Average• Chocolate• Petcare• Chilled Culinary • Frozen Food• Ice Cream

Portfolio performance

Ø Support & grow value driversØ Tackle underperformers & value diluters

Profit Pool 2007


Portfolio quality is improving

2008200720062005

Acquisitions

Divestitures

Dry Pasta

Private Label Ice CreamGermany

Bystroff - RussiaMakan Greece

Chilled Dairy


“... to be the best Food, Nutrition, Health and Wellness Company in Europe.”

By…- having the best people- leveraging brands, products and communication (60/40+)

- building proactive, collaborative relationships with customers & channels

- anticipating new brand & business opportunities

- all driving financial performance* We must see the world as it

is and yet want to change it

*

Our Ambition


Market size

Market growth

RMS (Rel. mkt share) Relative growth Relative profitabilityRelative profitability Capabilities

Mar

ket a

ttrac

tiven

ess

1.0

2.0

3.0

4.0

5.0

1.0 2.0 3.0 4.0 5.0

FR

FRDE

ESUA

IT CHFR

UA

CH

ES

FI

CH

DE

GR

BE

HUNO

RO

DE

AT

DK

BG

BG

RU

RO

HR

SEPT

BE

ATNL

AT

SK

RO

DK

RU

FI

SK

UA

ESSE

BA

RUSP

SPHRFI

GBFR

RUDE

RU

FR

FR

DE

DE

IT

ES

FR

ES

IT

PL

ES

IT

ESGR

IT

CZ

GB

IT

UA PL

FRFI

CHES

BE

PL

ES

CHDK

RU

ITNL

NLRU

ES

SK

CZIT

PT

IT

PT

HU

CH

GB HU

CH

PL

CH

CH

PT

PT

RU

CZ

HU

BE

NO

BE

CZ

BE

PT

HU

HU

HR

PT

NL

DK

PL

SK

CZBE

SP

BE

NL

BA

BA

SL

SL

PTATMarket profitability

Premiumness

0,0

1,0

2,0

3,0

Brand 1 Nestlé Brand 2 PL 1 PL 2

Volumes (2006)

Segment XYZ(CHF per volume unit, 2006)

Other brands

PL +30%

Value (~41%)

Premium(~59%)

Average brandPrice spread

(~76%)

PL max. vol.

0

200

400

600

800

1000

1200

1400

1600

1800

2000

2004 2007 2011

Mar

ket

size

(in

M C

HF)

Mashed potatoes Pasta Recipe mixes Flavour solutionsHot & cold sauces Soups Others

0

200

400

600

800

1000

1200

1400

1600

1800

Mar

ket s

ize

(200

7, in

M C

HF)

OthersSoupsPastaFlavour solutionsMashed potatoesRecipe mixesHot & cold sauces

-0,3

-0,2

-0,1

0

0,1

0,2

0,3

0 0,5 1 1,5 2

Relative market share 2007

RM

S c

hang

e 20

04-2

007

0 0,5 1 1 ,5 2

Relative market share 2007

0%

2%

4%

6%

8%

10%

Mashedpotatoes

Pasta Recipemixes

Flavoursolutions

Hot &cold

sauces

Soups Others

EB

IT (2

006,

in %

)

-10

-5

0

5

10%

Competitor 1

8.1%

Nestlé

5.3%

Competitor 2

3.1%

-2.0%

Competitor 4

-7.0%

EB IT(in % , 2 0 06 )

Competitor 3

Relative growth Relative profitabilityRelative profitability CapabilitiesDeliverySalesMarketingManufac-

turingI&R

“60/40”

Share of new products

Hit rate

…

Relative cost position (COGS)

Quality level

…

Brand equity

Marketing effective-ness

…

Key Account-Management-Power

Sales-Force effectiveness

Assortment

Merchandis-ing

…

Direct vs. indirect delivery

Delivery reliability (out of stock)

…

Total MOGE

- Local

- HQ charges

…

Admin

Ability-to-Win

Systematic yearly screening of consumer trends


Operational Efficiency

Innovation&

Renovation

ProductAvailability

ConsumerCommunic-

ation

Nestlé's four strategic pillars

MARKET SHAREEBITA

GROWTH

ACCELERATE


Focus on Super Premium and brand premiumisation

Value

Mainstream

Premium

Luxury

Super Premium


Chocolate Research Center, Broc, Switzerland

Partnership with Pierre Marcolini

Harbouring over 100 years of experience in chocolate

Nestlé has launched over 200 dark chocolate products in the last 2 years

Largest user of fine Cocoa beans

Strong innovation pipeline of premium and luxury products


Strong innovation pipeline of premium and luxury products

Komilfo Brand - Acquired in Nov 2007


Premiumisation at Nestlé…

Good market growth and future potential

Highly attractive economics

The right brand position and product quality

Strong pipeline for tomorrow

European approach

…driving growth and creating value


R&D Driven innovation: NESCAFÉ Dolce Gusto Europe

Ø 1.3 million machines sold

Ø Over 600 million capsules sold

Ø No.1 or 2 market position in 7 out of 10 markets

Ø 300 bps accretive to European Soluble coffee RIG (H1 2008)


SUCCESS:Ø Big brandsØ Affordable formats

PPP Sales in Russia : 2006, 2007, 2008 (Forecast)

+38%+30%

The emerging consumer opportunity in Central & Eastern Europe

2693

3501

1953 9.1%8.7%

7.2%

•0

500

1000

1500

2000

2500

3000

3500

4000

2006 2007 2008-1

1

3

5

7

9

11

13

15

PPP Sales% of total sales

Popularly Positioned Products in Russia: A great market opportunityIn

mio

of R

oubl

es

= € 100 mio


A similar opportunity exists in developed countries (e.g. France)

Suburbs of Paris Immigrants with low income represent an opportunity:

Maggi cube imported from Ivory

Coast

Halal food for Muslim immigrants who want

Halal French food

Route to market uses wholesalers specialised in imported products for immigrants. No stock: they

buy the entire batch


Coffee leadership


Ø Driven by consumer segmentation and insight

Ø Proven to enhance immune response in puppies by 50%

Ø H1 2008 Sales CHF 50 Mio

Ø Launch in all European markets

Nutrition Health & Wellness innovation: PROPLAN

Launched in April 2007


Accelerate growth in CEE: untapped opportunities: CHF 1 Bio+ initiative

We are committed to significantly accelerate our growth in CEE

Ø Over 150 new business opportunities

Ø Nutrition, Health & Wellness, Emerging consumers, Premiumisation are key

Ø Additional growth of CHF 1 Billion targeted by 2011

Ø Our ambition: by 2011, CEE should represent 20% of Zone’s sales with above Zone average profitability


Zone Europe

In summary...

Ø Europe: growth opportunity

Ø Performance is on track

Ø Potential for continued growth is promising

Ø Aligned organisation and portfolio with a vision and a plan

Ø Strong management with local expertise

Nestlé Europe: sustainable and profitable growth


Zone EuropeZone Europe

Luis CantarellExecutive Vice President Nestlé S.A. - Zone Europe


2008: Management priorities driving financial performance

Ø Organic growthØ Increased EBIT margin Ø Improve ROICØ Reduce working capitalØ Improve returns on trade spendØ Operational efficiencyØ Reduced overheads

The Nestlé Model


Outlook & improved guidance

Ø First half 2008 organic growth above 2007 –good momentum in our business

Ø EBIT margin improving performance

Ø Accelerated share buyback

Ø The Nestlé Model to be achieved:Ø Organic growth at least at 2007 levelØ Increased EBIT margin (reported &

constant currency)Ø Making Nestlé the reference for Nutrition, Health &

dWellness and for Financial Performance

2008 hy roadshow presentation - final [read-only] · digital media: increased share in adspend...

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