Nestle sees higher growth than expected

Nestle SA, the world’s largest food company, signaled that sales will hold up better than some analysts expected as the recession batters consumer spending and prompts rivals to abandon their forecasts.

The Swiss bottler of Perrier water said today that it aims for sales growth excluding acquisitions, disposals and currency swings to “at least approach” 5 per cent, compared with its goal for 5 per cent to 6 per cent growth a year on that basis. Analysts expect a 3.7 per cent gain in 2009, the slowest in 16 years, according to the median of 11 estimates.

Nestle, which rose the most in four months in Zurich trading, also reported a 69 percent increase in profit on gains from an asset sale. Earlier this month, the economic outlook and volatile commodity prices prompted food and soap maker Unilever to abandon its forecast, sending its shares tumbling.

It’s “not quite convincing that the Nestle model will hold” as economies deteriorate, said Andrew Wood, an analyst at Sanford Bernstein.