Milling & Baking News Corporate Profiles - November 2013 - (Page 112)

Company Overview Nestle S.A. Sale of Jenny Craig first of possibly several divestitures N estle, S.A., Vevey, Switzerland, the world's largest food company, did not meet its most recent sales targets and is considering making changes in its frozen-food units as well as possibly divesting poorly performing businesses. Nestle executives have been reluctant to say which units might be candidates for sale, but on Nov. 7 the company did announce it has sold its Jenny Craig weight management business in North America and Oceania to North Castle Partners L.L.C., a Greenwich, Conn.based private equity firm. Nestle's Jenny Craig business in France is not part of the transaction. Financial terms of the acquisition were not disclosed. Additionally, reports have suggested a possible sale of PowerBar, which Nestle acquired in 2000. Paul Bulcke, Nestle's chief executive officer, said the company would work hard to improve performance before moving to actually shed any businesses. Mr. Bulcke has said fresh competition from new entities sometimes has been stiff. "The short list of (brands that need) fixing is slightly longer than getting rid of," Mr. Bulcke said during an Oct. 1 investor seminar. "We are business people; we want to do business, not get rid of business. But there are some things we don't think we can fix." Food companies with an international presence have been dealing with an ongoing weak economy in Europe as well as a slowdown in the rate of growth in some emerging markets. But Nestle's frozen-food portfolio - its biggest North American food category that includes Lean Cuisine and several pizza brands - has been a disappointment of late, burned by an increasingly demanding American consumer who wants fresher food but does not want to sacrifice convenience to get it. Nestle wants to get the message out that freezing is a good way to keep food fresh. Since Nestle has made health and wellness a centerpiece of its corporate mission, perceptions that its frozen foods might contain less nutritious offerings is harmful to its brand. So-called "processed food" has attained a negative connotation for many consumers, and Nestle has not been able to dodge the headwinds. Nestle has attempted to address Chief executive officer - freshness concerns by introducing Lean Cuisine Honestly Good, with natural ingredients, and Salad Additions, microwavable pouches of grilled chicken, vegetables and dressing added to lettuce to make a salad that features lean protein, whole grains and vegetables. Nestle also will tweak some established lines such as Lean Cuisine. North American sales of premium ice cream also dipped in 2013, but Nestle has enjoyed strong growth in snacks and super-premium products because of innovation in its Häagen-Dazs brand through new Gelato Pints. Nestle also expanded its Skinny Cow brand of low-calorie frozen treats through introductions in cups, cones, ice cream sandwiches and truffle bars. Despite the challenges facing Nestle, the company achieved organic sales growth of 4.1% in the first half of 2013, the company said, and it announced that it would be striving for about 5% growth for the full year. Nine-month sales rose 5.6% in Asia, Oceania and Africa, helped by gains above 10% in Africa, Indonesia, the Middle East and India, Nestle said. CP Top brands - Nestle Lean Cuisine Gerber Nescafe Nestea 2012 global sales - Paul Bulcke 112 \ November 2013 $100.3 billion Milling & Baking News * Food Business News * Baking & Snack * Meat & Poultry Corporate Profiles

Table of Contents for the Digital Edition of Milling & Baking News Corporate Profiles - November 2013

Milling & Baking News Corporate Profiles - November 2013