A major confectionary company has warned that the cost of its products will continue to rise to match the cost of ingredients and production.
Nestle, which make the likes of KitKat, Smarties, Nespresso/Nescafe coffee, Cheerios and all of the Rowntrees products, saw a rise of 7.6% in sales for the first three months of the year.
However, that was coupled with a 5% hike in costs - and now bosses are saying this trend is set to continue.
"Cost inflation continues to increase sharply, which will require further pricing and mitigating actions over the course of the year," said Mark Schneider, its chief executive.
The cost of living crisis is being felt globally, partly as a result of the war in Ukraine.
Already, we've seen the prices of electricity and energy rise significantly as sanctions against Russia have been felt.
This, coupled with a rise in the demand for products with Covid-19 restrictions being lifted, has caused everyday items to become more expensive.
Furthermore, Ukraine is no longer exporting during the war, meaning that grains/oils and other requirements for food production need to be found elsewhere.
"In these first months of the year, the war in Ukraine has caused unspeakable human suffering,” Schneider added.
"We remain focused on supporting our colleagues there and providing humanitarian relief, while standing with the international community in the call for peace."
Matt Britzman, equity analyst at Hargreaves Lansdown, said: "Hiking prices to keep things moving in the right direction in the wake of input cost inflation certainly won't be a course of action management want to have to take.
"But nonetheless it's the position Nestle finds itself in and doesn't look likely to go away any time soon, which adds pressure to the group's volume-led strategy."
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