Danone has had a record quarter, with its strongest quarterly growth in a decade. Sales grew more than expected, although “much remains to be done”.
Higher expectations
Price increases helped Danone achieve a sales growth of 10.5 % to 6.96 billion euros, thanks to prices that were 10.3 % higher on average. Volumes increased by 0.2 % and thus remained nearly stable. All three segments (dairy and plant products, speciality food and water) contributed to the growth, the company said.
This means that consumers barely switched to cheaper alternatives, which is why the yogurt producer even dares to raise its annual forecast. For 2023, the manufacturer now expects sales growth of between 4 and 6 %, instead of the 3 to 5 % previously forecast.
CEO Antoine de Saint-Affrique describes this progress as encouraging, but stresses that “much remains to be done”. Danone is working on a new strategy and better operational efficiency. Operating margins in particular are lagging behind growth, which he hopes to improve modestly this year. Last year, the company’s net profit was halved.
