ZURICH, March 28 (Reuters) – Nestle (NESN.S) will examine its banking relationships following the planned acquisition of Credit Suisse (CSGN.S) by UBS (UBSG.S), the food group’s CEO Mark Schneider said on Tuesday.
The world’s largest food group was a customer of Credit Suisse, Schneider told broadcaster TeleZueri in an interview to be shown Tuesday evening, following the collapse of Switzerland’s second largest bank.
“We have worked closely with Credit Suisse for decades in a spirit of trust,” Schneider told the broadcaster.
“You can see from such an example that Switzerland as a location and financial center are very closely linked. We now have to look at how we can reorganize our banking relationships, both with Swiss and international providers.”
Schneider said the intervention of the Swiss government, central bank and financial market regulator to broker a merger with UBS stabilized the situation and restored confidence.
Speaking of Nestle, Schneider said the company had a good start to 2023, although further price increases by the company would likely offset raw material cost inflation, Schneider said.
The maker of Nescafe instant coffee and KitKat chocolate bars raised prices by 8.2% last year, but that didn’t fully offset the impact of higher ingredient costs on margins.
Price increases have so far had only a “very limited” impact on consumer spending, Schneider said.
“As inflation continues and also affects our own profitability, we will have to adjust prices,” said Schneider.
“We will continue to do this responsibly, we don’t want to be a price driver. We react to inflation, we don’t feed it,” he said.
The food maker was also working on savings to meet its target for a full-year underlying operating profit margin of between 17% and 17.5%, Schneider added.
Reporting by John Revill; Edited by Louise Heavens and David Holmes
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