Nestle announces major share buyback scheme and revised business priorities

Nestle has announced a number of new business initiatives and priorities, following a review of the company’s capital structure held earlier this year.

A new share buyback programme, worth up to 20 billion Swiss francs (16.09 billion pounds), will launch on July 4th and is due to be completed by the end of June 2020.

The scheme is being introduced in response to recent low interest rates and strong cash flow generation, with Nestle noting that buyback activity will be adapted accordingly if any sizeable acquisitions take place during this period.

Additionally, the firm announced that its capital spending strategy moving forward will be focused on advancing high-growth food and beverage categories – such as coffee, petcare, infant nutrition and bottled water – and exploring growth opportunities in consumer healthcare.

Building on recent momentum in high-growth geographic markets was also cited as a strategic priority, while the only external growth opportunities that will be pursued are those that fit within targeted categories and geographies and deliver attractive returns.

A company statement said: "Nestle's financial strategy aims at striking the right balance between growth in earnings per share, competitive shareholder returns, flexibility for external growth and access to financial markets."

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