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Friday, 23 February, 2001, 11:43 GMT
Nestle's profits surge
Nestle chocolate bars
Nestle's brand has a high profile in the chocolate industry
Nestle, the world's biggest food company, has reported a 22% rise in profits to reach a record 5.76 Swiss francs ($3.39bn, £2.35bn).

Nestle's sales rose by 9.1% to 81.42bn francs, with trading profit rising 16.1% to 9.19 bn francs.

Real internal growth - which strips out the impact of exchange rates, acquisitions and divestments - was up 4.4%, the best performance since 1991.

The maker of coffee, ice cream and pet food says that its wide product and geographical spread means that it is able to withstand any global economic weakening that could hit consumer sentiment.

"We are weathering difficult times more easily than everybody else and I see no reason why our internal growth [target] of 4% should not be reached in 2001," said Chief Executive Peter Brabeck.

Nervous buyers

But despite the company's improved performance, the profits fell slightly short of analysts expectations.

And analysts believe that a less favourable exchange rate, nervous consumer sentiment, and the $10bn cost of buying US pet food firm could all have a negative effect on the company's performance this year.

Shares rose about 1% in early morning trade, in an otherwise flat Swiss market.

And Nestle proposes to raise its dividend to 55 francs a share.

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See also:

16 Jan 01 | Business
Nestle in $10.3bn pet food buy
10 Jul 00 | Business
Nestlé in sterling debate
19 Aug 99 | The Company File
Ice cream alliance
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