Nestlé is set to slash costs by £2.2bn by 2027, boost marketing and advertising, and separate its water and premium drinks business, in new plans revealed by its CEO.

Chief executive Laurent Freixe, who took up the role this September replacing former CEO Mark Schneider, plans to hit cost savings of £2.2bn (2.5bn Swiss francs) by 2027, alongside rolling savings of £1.07bn (1.2bn Swiss francs).

However, the food and drink manufacturer plans to increase investment in advertising and marketing to 9% of total sales by 2025.

In 2023, Nestlé’s advertising and marketing expenses were only 7.7% of sales.

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Elsewhere, Nestlé revealed its decision to carve out its water and premium drinks beverages into a separate global unit from January 2025.

Frexie said he believed the reallocation of the funds and the separating of the division would boost innovation and sales at Nestlé.

He said: “Nestlé is a strong company with global reach, exceptional demand generation and in-market capabilities. We have a diverse and strategically well-positioned product portfolio.

“Our iconic brands and innovative products connect with people every day, at every stage of their lives. These strengths give us a unique advantage and position us to win in the marketplace.

“We will now invest further in our brands and growth platforms to unlock the full potential of our products for our consumers and our customers. Our action plan will also improve the way we operate, making us more efficient, responsive and agile. This will allow us to deliver value for all our stakeholders.

Last month, in his first major move since appointed CEO, Frexie revealed he had restructured the business and its executive team to be “leaner”, as Nestlé cut its guidance after weaker-than-expected sales.