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Nestle Profit Rises 12.7 Percent

August 22, 2001

VEVEY, Switzerland (AP) _ Nestle SA, the world’s largest food and beverage company, said Wednesday its profit rose 12.7 percent on a 6.3 percent increase in sales in the first half of the year despite the global economic slowdown.

The owner of Perrier water, Taster’s Choice coffee, Baby Ruth candy bars and Friskies pet food earned 3.15 billion Swiss francs ($1.75 billion) for the first half, up from 2.8 billion francs in the year-earlier period. Sales increased to 41.2 billion francs ($22.9 billion) from 38.8 billion francs last year.

Analysts have said Nestle could face some difficulties in the second half because of economic problems in Latin America and the weaker dollar.

Nestle shares were down 2.3 percent at 362.5 francs ($219) by midday in trading in Zurich.

Peter Brabeck, chief executive of Nestle, said he expected Nestle would have higher sales and profits for the full year. Nestle earned 5.76 billion francs on sales of 81.4 billion francs last year.

The company said its real internal revenue growth was 4.6 percent for the first six months, up from 4.5 percent in the same period a year ago. Real internal growth measures revenue adjusted to remove any impact of foreign exchange rates, acquisitions and divestitures.

Nestle’s Asia, Oceania and Africa operations recorded the strongest real internal growth rate, reporting a rise of 7.2 percent. The Americas were up 2.9 percent, and Europe was up 2.6 percent.

Nestle said its takeover of U.S. pet food producer Ralston Purina is on target for completion by the end of this year. The U.S. Federal Trade Commission is examining the $10 billion deal, announced Jan. 16. The European Union cleared the takeover, with minor concessions, at the end July.

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On the Net:

Nestle site: http://www.nestle.com

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