Click the image for details After the Spring Festival, international food giants have released their 2018 annual reports. How did they perform in the past year? Nestlé 618.57 Billion Raking in 47 Billion in China ● 2018 revenue: 91.4 billion Swiss francs (approximately 618.57 billion RMB), up 2.1% year-on-year. ● 2018 net profit: 10.1 billion Swiss francs (approximately 67.84 billion RMB), up 41.6% year-on-year. ● Nestlé China's 2018 market revenue: 7 billion Swiss francs (approximately 47 billion RMB), up 6.5% from the same period last year. The financial report shows that Nestlé achieved 3% organic growth in 2018, with real internal growth of 2.5% and price factors contributing 0.5%. Growth was primarily driven by strong momentum in the US and Chinese markets, as well as the infant nutrition business. A key factor boosting Nestlé's sales growth was price increases. The annual report shows that Nestlé raised prices by 0.3% in the first half of 2018, increasing to 0.9% in the second half, with an average annual price increase of 5%. In 2018, Nestlé's China market revenue was 7 billion Swiss francs (approximately 47 billion RMB), up 6.5% year-on-year, mainly driven by innovation in infant nutrition, coffee, culinary products, and e-commerce. However, despite its massive size, this giant is little known in China. The fundamental reason is that its localization strategy does not impose the Nestlé brand on subsidiaries after acquisitions, playing a stealth role. For example, in China, brands like Starbucks, Totole, Haoji Chicken Essence, Hsu Fu Chi, and Yinlu are now all under Nestlé. PepsiCo 437.79 Billion Snacks Outperform Beverages ● 2018 revenue: 64.661 billion USD (approximately 437.79 billion RMB), up 2% year-on-year; ● 2018 operating profit: 10.11 billion USD (approximately 68.45 billion RMB), down 2% year-on-year. North American beverage operating profit fell 14% in the fourth quarter and 16% for the full year, mainly due to higher transportation and raw material costs, as well as increased advertising and marketing expenses. North American beverages contributed one-third of revenue but only 22% of operating profit, while the snack business accounted for only 29% of revenue but contributed half of operating profit. Europe and Sub-Saharan Africa saw 7% organic sales growth; Asia, Middle East, and North Africa achieved 7% organic growth for the full year; Latin America saw organic growth as high as 8%. Operating profit in these three international regions also grew by double digits. Coca-Cola 215.68 Billion Healthy Beverages as New Engine ● 2018 revenue: 31.856 billion USD (approximately 215.68 billion RMB), down 10% year-on-year; ● 2018 net profit: 6.476 billion USD (approximately 43.85 billion RMB), up 405% year-on-year. Coca-Cola's performance report shows that among its products, carbonated soft drinks grew 2% for the full year, water and sports drinks grew 3%, and tea and coffee grew 1%. The main growth regions for carbonated drinks were China, India, Central and Eastern Europe. Coca-Cola Zero experienced double-digit growth globally. In North America, Diet Coke emerged from several years of decline, with retail value growing 3%. The Chinese market contributed to sparkling soft drinks, sports drinks, tea, and coffee businesses—sparkling soft drinks grew 2% due to growth in China, India, and Central and Eastern Europe; especially with innovations like Sprite Fiber+ in China, Sprite's global sales grew 2%. Coca-Cola is also decisively abandoning old products, discontinuing 700 underperforming products in 2018. Danone 189.28 Billion Strong Performance in China ● 2018 revenue: 24.7 billion euros (approximately 189.28 billion RMB), up 2.9% year-on-year; ● 2018 operating profit: 3.6 billion euros (approximately 27.59 billion RMB), with recurring operating margin up 51 basis points to 14.45%; ● 2018 free cash flow: 2.2 billion euros (approximately 16.86 billion RMB), up 7.1% year-on-year. In the past year, Danone significantly accelerated its innovation pace, contributing to a quarter of total sales revenue in 2018, compared to only 16% two years ago. Additionally, Danone's e-commerce business sales revenue grew 40% last year. The water and beverage business saw net sales revenue grow 5.3% year-on-year. In the fourth quarter of 2018, global sales for this business grew strongly, up 5.6% year-on-year, matching the pace of the first nine months. In the fourth quarter, despite weak summer market conditions, Danone's market share in China's water and beverage business remained stable. In 2018, Danone's specialized nutrition business saw net sales revenue grow 5.9% year-on-year. Danone's early life nutrition sales in China account for about 30% of global sales, with major brands including Nutrilon and Aptamil. In terms of essential dairy and plant-based products in international markets and North America, these two businesses saw net sales revenue grow 0.1% and 1.5% year-on-year, respectively. Mondelez International 175.48 Billion High-Speed Growth in China's E-commerce ● 2018 revenue: 25.938 billion USD (approximately 175.48 billion RMB), up 0.2% year-on-year; ● 2018 net profit: 3.381 billion USD (approximately 22.87 billion RMB), up 15.71% year-on-year. Mondelez International was spun off from Kraft's snack business in October 2012. It owns well-known and beloved brands such as Oreo, Chips Ahoy!, Tuc, Ritz, Prince,太平, LU, Stride, Halls, Trident, and Maxwell House. Mondelez's CEO stated that 2018 was a year of "strong growth" for the company, including accelerated revenue growth through volume and price mix, with emerging markets contributing a 6% revenue increase. However, looking at recent financial data, Mondelez has shown signs of sluggish revenue growth and slowing performance. In the Chinese market, the CEO said that through partnerships, Mondelez achieved high-speed growth in e-commerce, with an 80% increase, while overall sales revenue saw single-digit growth. Hershey 52.75 Billion ● 2018 revenue: 7.791 billion USD (approximately 52.75 billion RMB), up 3.67% year-on-year; ● 2018 net profit: 1.178 billion USD (approximately 7.98 billion RMB), up 50.39% year-on-year. The Hershey Company, the largest premium chocolate manufacturer in North America, is also a global leader in chocolate and candy production. Its main products include chocolate and candy, baking ingredients, toppings, and beverages. The company owns over 80 brands. However, the Chinese market remains a "heartache" for Hershey, the largest chocolate and candy producer in North America. It remains uncertain when Hershey can reverse its performance decline in China. Orion China 5.607 Billion New Products Drive Growth ● 2018 revenue: 5.607 billion RMB, up 18.1% year-on-year; ● 2018 operating profit: 851 million RMB, with continued improvement in operations. Orion China's growth was mainly driven by new products. Data shows that in 2018, Orion launched new products in China including Lang Li Ge Lang, Q蒂 Red Velvet, Orion Pie Fresh Berry, Hun Da Cui, and Dian Dian Jiang. Data shows that among Orion China's five major categories, pie product sales reached 2.008 billion RMB in 2018, while puffed products contributed 2.313 billion RMB. In 2018, several new Orion products exceeded 100 million RMB in sales in their launch year, with new products accounting for over 10% of sales. Lang Li Ge Lang, which started production in April, sold a cumulative 35 million bags in China by "Double 11", with sales reaching 120 million RMB. Not only these foreign companies, but also international food giants like Danone and Mars expect to achieve impressive performance in the Chinese market. In the future, facing China's volatile market, only by continuously accelerating localization can they adapt to China's rapidly changing FMCG market and maintain stable performance. Source: Food Industry Expert (ID: shiyehome) New Distribution will hold the 2019 (5th) FMCG + Internet Conference during the Chengdu Spring Sugar and Wine Fair from March 16 to March 18. This conference will focus on the topic of "Breaking the Game", engaging in in-depth discussions with numerous brand owners, supply chain service providers, distributors, retailers, and others. Compared to previous conferences, this summit will be fully upgraded. In addition to original topics like channel innovation, city distribution logistics, and distributor transformation, it will add multiple parallel forums on new marketing cases, IP + FMCG empowerment, community group buying, and innovative retail. Through three days of ten high-density, high-quality expert sharing sessions, we believe every brand owner and distributor can learn the latest business models, expert insights, and practical methods, finding new tools and methods to break the game in 2019 and return to a track of high-speed growth. Review of Previous Conferences -END-