Nestle outlines “extreme nutrition” build-up plan

LAUSANNE, Switzerland Nestle on Tuesday laid out its plan to become the world’s largest provider of “extreme nutrition,” building up its high-tech health foods, with recent takeovers of Gerber baby foods and Novartis Medical Nutrition helping catapult the company into the No. 2 food spot for babies, hospitals and “pro-active health seekers.”

The world’s largest food company now is providing healthy nutrition products for patients leaving the operating room, cancer patients and is addressing the rising incidence of diabetes and obesity. Nestle also is targeting consumers seeking healthy foods that prevent other maladies or can enhance athletic performance.

“We deal with consumers at the extreme: extremely old, extremely young, extremely frail, or extremely fit,” said Richard Laube, head of Nestle Nutrition.

But integrating the recent takeovers into the group has its challenges that will keep the division busy if it aims to reach its profitability goal in two to three years, according to Laube. Changing formulas in medical foods, such as probiotics or protein levels for example, is more complicated than changed recipes for Nestle’s name-brand foods.

The Nutrition division aims to lift its operating profit margin to 20 percent in the medium term from the 16.9 percent reported at end 2006. “We’ll probably have two or three years in the 16 to 17 (percent) range as we integrate our acquisitions,” Laube said. “We’re on a nice glide path to 20 percent.”