Switzerland's Nestle has passed on the rising cost of raw materials like coffee, milk and wheat to its consumers, boosting underlying sales by more than seven per cent after nine months.
The world's largest food group - the maker of Nescafe coffee and KitKat chocolate bars - met analysts' forecasts with nine-month underlying sales growth of 7.2 per cent, only a small slowdown from 7.4 per cent in the first half.
Nestle warned that markets for agricultural commodities will remain tough next year and said it expects to continue to raise prices to pass on the higher costs to its consumers.
"Our estimate is that after 10 years of growth and two years of steep growth, we consider that (commodity costs) in the coming years will stabilise, but at a high level," chief executive officer Peter Brabeck told a news conference.
Analysts said the results and input cost rises were in line with expectations.
Mr Brabeck confirmed Nestle's this year's outlook, with underlying sales, which strip out acquisitions and currency movements, set to grow by nearly seven per cent, above a long-term target of between five and six per cent. Nestle also sees a sustainable improvement in margins.
The firm said chief financial officer Paul Polman will become head of its biggest region, the Americas, in February, after he lost the race to replace Mr Brabeck as chief executive officer when the Austrian steps down in April next year.
Mr Polman replaces chief executive officer designate Paul Bulcke. James Singh, currently head of acquisitions and business development, will take over from Mr Polman as financial officer.
Analysts said the nine-month sale performance was solid and it was positive the well-respected Mr Polman was staying.
" There is a strong set of figures with accelerating growth in Europe which is positive. The company has heavy exposure to health and wellness categories, the strongest growing part of the market," said Jon Cox, an analyst at Landsbanki Kepler.
Overall group nine-month sales rose nine per cent to $66.64 billion, underlying sales growth was 7.2 per cent for the January-September period while internal growth, which also strips out inflation, was 4.5 per cent.
French rival Danone reported nine-month underlying sales rose seven per cent as it saw a third-quarter slowdown to 3.9 per cent, while Unilever which reports its third-quarter on November 1, saw a 5.8 per cent first-half rise.
Nestle, whose brands include Buitoni pasta, Maggi soups and Friskies cat food, has been successful this year in using its muscle to raise prices and overcome soaring input costs.
After strong growth in recent quarters, the price of milk was expected to ease in the second half of next year, Mr Polman said, adding the group was broadly covered for a continued tough environment in commodity markets.
From April, Mr Brabeck in his capacity as non-executive chairman will focus on the firm's non-food and beverage shareholdings, including an approximately 77 per cent stake in US eyecare firm Alcon and a 28 per cent share of cosmetics company L'Oreal.
No decisions have been taken on the shareholdings, he said, but noted that Alcon "did not need" Nestle and that selling the stake in L'Oreal was one possible option he would consider.