Investing.com -- Shares in Nestle (SIX:NESN) slipped in early European trading on Thursday after the food and drinks giant reported disappointing full-year organic sales growth despite ongoing price hikes.
Like much of the packaged goods industry, the Swiss owner of Cherrios cereal and Nescafe coffee has been increasing prices in a bid to offset a jump in input costs that stemmed from the COVID-19 pandemic and the outbreak of hostilities in Ukraine.
But the move has dented demand from shoppers, many of whom are choosing to rein in spending during a time of elevated interest rates and high inflation.
Total annual group pricing jumped by 7.5%, in line with expectations and slower than pace of 9.5% registered in the first half of 2023. Meanwhile, real internal growth, Nestle's measure of sales volumes, dipped by 0.3% in the twelve months to December.
Full-year organic sales, which take out the effects of currency movements and acquisitions, increased by 7.2%, below analysts' estimates of 7.4% cited by Reuters.
"Unprecedented inflation over the last two years has increased pressure on many consumers and impacted demand for food and beverage products," said Chief Executive Mark Schneider in a statement.