Danone aims to boost its growth in the second half of the year, despite flat sales in the second quarter due to its dairy and plant-based divisions.
Second quarter like-for-like sales were up 0.2%, slowing down from 0.7% recorded in the first three months. Meanwhile first half operating profit grew 7.3% to €1.72bn on a like-for-like basis.
Performance lagged in the company’s Essential Dairy and Plant-Based businesses which were down 1.8% in the second quarter, responding to the Activia relaunch in Europe.
In March, the French company said it would sell its Stonyfield organic yogurt business to Lactalis in a deal worth $875 million as it aims to expedite its $10.4 billion acquisition of WhiteWave Foods.
Danone CEO Emmanuel Faber said: “As expected, the slow start of the year is the result of specific emerging markets’ headwinds and challenges in Europe and in North America, balanced with significant successes in developing sustainable platforms in Specialized Nutrition in China, growing young and local dairy brands in Europe and executing the Dannon Pledge in the United States.
“I am pleased with the structural progress we have made during H1, in securing short-term delivery while preparing for growth acceleration and long-term transformation.”
The company also highlighted the current volatile economic conditions in which it operates and a rise in the cost of raw materials.
However, it still aims to deliver double-digit earnings growth per share at constant exchange rates for 2017. The deal to sell Stonyfield is expected to be completed in August.
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