Zurich: Swiss multinational food giant Nestle on Friday lowered its full-year growth forecast to 4.5 per cent this year due to ban on Maggi noodles in India and slower sales recovery in China.
"The material impact of the withdrawal of Maggi noodles in India and the situation in China, where the recovery is slower than expected, continued to affect the AOA (Asia, Oceania and Africa) zone's growth significantly, overshadowing better performances elsewhere in emerging markets and solid growth in developed markets," Nestle said in a statement.
It further said: "For the full year, we project organic growth of around 4.5 per cent with improvement in margins and underlying earnings per share in constant currencies and capital efficiency."
The company, which had earlier given full-year sales growth forecast of around 5 per cent, reported sales of 64.86 billion Swiss francs (USD 68.23 billion) in the nine months to September 2015 as against sales of 66.22 million Swiss francs in the same period last year.
On the forecast, Nestle CEO Paul Bulcke said: "After a good performance in the first half of the year, we were impacted in the third quarter by exceptional events, with Maggi noodles in India and a rebate adjustment in Nestle Skin Health."
Nestle said lost sales of Maggi noodles in emerging markets continued to have a significant impact on growth in the South Asian region.
Earlier today, the company's Indian arm, Nestle India said all samples of Maggi have cleared tests conducted by three laboratories, as mandated by the Bombay High Court, paving the way for a potential market comeback for the instant noodles brand after it was banned over presence of excess lead.
Nestle India said it will now commence manufacturing and will sell "only after the newly manufactured products are also cleared by the designated three laboratories".
The company further said it "is actively engaging with the authorities to get the product back on the shelves".
In June, FSSAI had banned Maggi noodles saying it was "unsafe and hazardous" for consumption after finding lead levels beyond permissible limits. The company had withdrawn the instant noodles from the market.
