STOCK TITAN

Danone: Good start to the year; Further delivering on Renew Danone

Rhea-AI Impact
(Neutral)
Rhea-AI Sentiment
(Neutral)
Tags
Danone reported a good start to the year in the 2024 First Quarter Sales, with net sales reaching €6,789m, up +4.1% on a like-for-like basis. The company made progress on its Renew Danone agenda, with positive volume/mix across categories and solid growth in Europe, North America, and China. Portfolio rotation activities were successful, and the 2024 guidance confirms like-for-like sales growth between +3% and +5%.
Danone ha riportato un buon inizio di anno nelle vendite del primo trimestre 2024, con vendite nette che hanno raggiunto i 6.789 milioni di euro, aumentando del +4,1% su base omogenea. L'azienda ha fatto progressi nel suo programma Rinnova Danone, con un positivo andamento di volume/mix attraverso le categorie e una solida crescita in Europa, Nord America e Cina. Le attività di rotazione del portafoglio sono state efficaci, e le previsioni per il 2024 confermano una crescita delle vendite omogenee tra il +3% e il +5%.
Danone reportó un buen inicio de año en las ventas del primer trimestre de 2024, con ventas netas alcanzando los €6,789 millones, un aumento del +4.1% en términos comparables. La compañía avanzó en su agenda Renovar Danone, con un positivo volumen/mezcla a través de las categorías y un sólido crecimiento en Europa, América del Norte y China. Las actividades de rotación de cartera fueron exitosas, y la guía para 2024 confirma un crecimiento de las ventas comparables entre el +3% y el +5%.
다논은 2024년 첫 분기 매출에서 좋은 시작을 보고했으며, 순매출은 6,789백만 유로에 달해 동일 기준으로 4.1% 증가했습니다. 회사는 '다논 갱신' 의제에서 진전을 이루었으며, 카테고리 전반에 걸쳐 긍정적인 볼륨/믹스와 유럽, 북미, 중국에서의 견고한 성장을 달성했습니다. 포트폴리오 회전 활동이 성공적이었으며, 2024년 가이던스는 동일 기준 매출 성장이 +3%에서 +5% 사이가 될 것으로 확인합니다.
Danone a rapporté un bon début d'année dans les ventes du premier trimestre 2024, avec des ventes nettes atteignant 6,789 millions d'euros, en hausse de +4,1% sur une base comparable. L'entreprise a progressé dans son agenda Renouveler Danone, avec un volume/mix positif à travers les catégories et une croissance solide en Europe, en Amérique du Nord et en Chine. Les activités de rotation de portefeuille ont été couronnées de succès, et les prévisions pour 2024 confirment une croissance des ventes comparables entre +3% et +5%.
Danone verzeichnete einen guten Start ins Jahr mit den Umsätzen des ersten Quartals 2024, wobei die Nettoumsätze €6.789 Millionen erreichten, ein Anstieg von +4,1% auf vergleichbarer Basis. Das Unternehmen machte Fortschritte bei seiner Agenda 'Danone erneuern', mit positiver Volumen/Mix-Entwicklung in allen Kategorien und solidem Wachstum in Europa, Nordamerika und China. Die Aktivitäten zur Portfolio-Rotation waren erfolgreich, und die Prognose für 2024 bestätigt ein vergleichbares Umsatzwachstum zwischen +3% und +5%.
Positive
  • Net sales reached €6,789m in Q1 2024, up +4.1% on a like-for-like basis
  • Volume/mix was up +1.2%, and price up +2.9%
  • Broad-based growth with positive volume/mix across categories
  • Solid start in Europe and North America amid pricing normalization
  • Sustained competitive growth in all categories in China
  • Successful portfolio rotation activities with disposals closed
  • 2024 guidance confirmed with expected like-for-like sales growth between +3% and +5%
Negative
  • None.

2024 First Quarter Sales
Press release – Paris, April 18, 2024

Good start to the year
Further delivering on Renew Danone

  • Net sales reached €6,789m in Q1 2024, up +4.1% on a like-for-like (LFL) basis, with volume/mix up +1.2%, and price up +2.9%
  • Making continued progress on Renew Danone
    • Broad-based growth, with positive volume/mix across categories
    • Solid start to the year in Europe and North America amid pricing normalization
    • Sustained competitive growth in all categories in China
    • Continued progress on fixing business models in Emerging Markets        
    • Portfolio rotation: Horizon Organic and Wallaby milk and dairy activity in the US and Michel & Augustin disposals successfully closed
  • 2024 guidance confirmed: like-for-like sales growth expected between +3% and +5%, with moderate improvement in recurring operating margin


€ million
except %
Q1
2023
Q1
2024
Reported
change
LFL sales
growth
Volume/mix
growth


BY GEOGRAPHICAL ZONE
     
Europe2,2482,336+3.9%+2.8%+0.1%
North America1,7141,737+1.3%+2.5%+1.5%
China, North Asia & Oceania824840+1.9%+8.9%+6.9%
Latin America689727+5.4%+4.1%-2.6%
Rest of the World1,4861,150-22.7%+6.0%+1.0%


BY CATEGORY
     
EDP3,7683,474-7.8%+3.0%+0.8%
Specialized Nutrition2,1432,183+1.9%+3.8%+0.3%
Waters1,0511,132+7.6%+8.1%+3.9%
      
TOTAL6,9626,789-2.5%+4.1%+1.2%

1

Antoine de Saint-Affrique: CEO statement

We have delivered a good start to the year, with yet another quarter of quality growth and consistent delivery on our Renew Danone agenda: net sales were up +4.1% on a like-for-like basis and volume/mix up +1.2%, with all categories positively contributing.

In what remains a challenging environment, we continued making good progress on our transformation agenda, strengthening our category fundamentals, intentionally driving our winning mixes and geographies while delivering on portfolio rotation with the successful closing of the disposals of our milk and dairy activity Horizon Organic and Wallaby in the US and Michel & Augustin. 

We are confident that 2024 will be another year where we deliver on our value creation model. With that in mind, we look forward to talking more about the next chapter of Renew Danone at our Capital Market Event in Amsterdam in June.

I. FIRST QUARTER SALES

In Q1 2024, consolidated sales stood at €6.8 bn, up +4.1% on a like-for-like basis, led by an increase of +1.2% from volume/mix and +2.9% from price. On a reported basis, sales decreased by -2.5%, mainly penalized by the strong negative impact from scope (-5.0%), resulting from the deconsolidation of EDP Russia starting from July 2023, and the negative impact from forex of -3.2%. Besides, hyperinflation contributed positively to reported sales (+1.7%).

Sales by operating segment

In the first quarter, Europe sales were up +2.8% on a like-for-like basis, with volume/mix up +0.1% and price up +2.8%. EDP continued its turnaround, notably led by Actimel, Activia, YoPro and Alpro brands, despite temporary shipment disruptions. Specialized Nutrition delivered resilient growth, on a high base, while Waters posted strong growth, notably driven by the sustained competitive performance of evian and Volvic. In North America, sales were up +2.5% on a like-for-like basis, led by volume/mix up +1.5% and price up +1.0%. The performance was led by Coffee Creations and High Protein Yogurts, and in particular by International Delight, Stok and Oikos brands, while in Plant-based, the portfolio restaging starts to show first signs of progress. China, North Asia & Oceania delivered +8.9% like-for-like sales growth, led by volume/mix up +6.9% and price up +2.0%. In China, Specialized Nutrition maintained its competitive momentum, while Mizone posted a strong start to the year, growing steep double-digits. Outside China, EDP registered double-digit growth in Japan, led by dairy functional brands. In Latin America, sales were up +4.1%, with price up +6.8% and volume/mix down -2.6%. The performance was driven by strong growth in Waters, led by Bonafont. EDP volume/mix was impacted by the licensing out of milk business in Brazil, while the value-added part of the portfolio, such as YoPro brand, posted a good performance. In the Rest of the World, sales increased by +6.0% on a like-for-like basis, with price up +4.9% and volume/mix up +1.0%, notably led by the resilient growth of Specialized Nutrition across Asia and the Middle-East, on a high base.

Sales by geography by category

Q1 2024

EuropeNorth AmericaChina/North Asia/OceaniaAMEA, CIS & Latin AmericaTotal
Net sales (€m)LFL sales growth (%)Net sales (€m)LFL sales growth (%)Net sales (€m)LFL sales growth (%)Net sales (€m)LFL sales growth (%)Net sales (€m)LFL sales growth (%)
           
EDP1,088+1.7%1,590+2.6%87+16.0%709+4.9%3,474+3.0%
Specialized Nutrition785+2.5%80-5.7%596+4.0%722+6.5%2,183+3.8%
Waters462+6.1%67+10.9%157+27.6%446+4.1%1,132+8.1%
Total Company2,336+2.8%1,737+2.5%840+8.9%1,876+5.3%6,789+4.1%

II. 2024 GUIDANCE

2024 guidance confirmed: like-for-like sales growth between +3% and +5% with moderate improvement in recurring operating margin.

III. OTHER DEVELOPMENTS OVER THE PERIOD

  • February 29, 2024: Danone completed the sale of Michel & Augustin.

  • March 22, 2024: Danone announced that the Russian regulatory approvals required for the disposal of its EDP business in Russia to Vamin R LLC have been obtained. The closing of this disposal is expected in the coming weeks.

  • April 1, 2024: Danone completed the sale of its milk and dairy activity Horizon Organic and Wallaby in the U.S. to Platinum Equity. Danone retains a non-consolidated minority stake in the business.

IV. ALTERNATIVE PERFORMANCE MEASURES NOT DEFINED BY IFRS

IAS 29: impact on reported data

Danone has been applying IAS 29 in hyperinflation countries as defined in IFRS. Adoption of IAS 29 in hyperinflationary countries requires its non-monetary assets and liabilities and its income statement to be restated to reflect the changes in the general pricing power of its functional currency, leading to a gain or loss on the net monetary position included in the net income. Moreover, its financial statements are converted into euros using the closing exchange rate of the relevant period.

IAS 29: impact on reported data
€ million except %
Q1 2024
Sales12.7
Sales growth (%)0.19%

Definitions of geographical zones

Europe refers to European countries and Ukraine.

North America includes United States and Canada.

China, North Asia & Oceania includes China, Japan, Australia and New-Zealand.

Latin America includes Mexico, Brazil, Argentina and Uruguay.

Rest of the World includes AMEA (Asia, Middle East including Turkey, Africa) and CIS.

Financial indicators not defined in IFRS

Due to rounding, the sum of values presented may differ from totals as reported. Such differences are not material.

Like-for-like changes in sales reflect Danone's organic performance and essentially exclude the impact of:

  • changes in consolidation scope, with indicators related to a given fiscal year calculated on the basis of the previous year's scope;
  • changes in applicable accounting principles;
  • changes in exchange rates, with both previous-year and current-year indicators calculated using the same exchange rates (the exchange rate used is a projected annual rate determined by Danone for the current year and applied to both previous and current years).

Since January 1st, 2023, all countries with hyperinflationary economies are taken into account in like-for-like changes as follows: net sales growth in excess of around 26% per year (a three-year average at 26% would generally trigger the application of hyperinflationary accounting as defined in IFRS) is now excluded from the like-for-like net sales growth calculation.

Bridge from reported data to like-for-like data

(€ million except %)Q1 2023Like-for-like changeImpact of changes
in scope of consolidation
Impact of changes in exchange rates & others incl. IAS 29Contribution of hyperinflationReported changeQ1 2024
        
Sales6,962+4.1%-5.0%-3.2%+1.7%-2.5%6,789

Recurring operating income is defined as Danone’s operating income excluding Other operating income and expenses. Other operating income and expenses comprise items that, because of their significant or unusual nature, cannot be viewed as inherent to Danone’s recurring activity and have limited predictive value, thus distorting the assessment of its recurring operating performance and its evolution. These mainly include:

  • capital gains and losses on disposals of fully consolidated companies;
  • impairment charges on intangible assets with indefinite useful lives;
  • costs related to strategic restructurings or transformation plans;
  • costs related to major external growth transactions;
  • costs related to major crisis and major litigations;
  • in connection with IFRS 3 (Revised) and IAS 27 (Revised) relating to business combinations, (i) acquisition costs related to business combinations, (ii) revaluation profit or loss accounted for following a loss of control, and (iii) changes in earn-outs relating to business combinations and subsequent to acquisition date.

Recurring operating margin is defined as the Recurring operating income over Sales ratio.

o o O o o

FORWARD-LOOKING STATEMENTS

This press release contains certain forward-looking statements concerning Danone. In some cases, you can identify these forward-looking statements by forward-looking words, such as “estimate”, “expect”, “anticipate”, “project”, “plan”, “intend”, “objective”, “believe”, “forecast”, “guidance”, “foresee”, “likely”, “may”, “should”, “goal”, “target”, “might”, “will”, “could”, “predict”, “continue”, “convinced” and “confident,” the negative or plural of these words and other comparable terminology. Forward looking statements in this document include, but are not limited to, predictions of future activities, operations, direction, performance and results of Danone.

Although Danone believes its expectations are based on reasonable assumptions, these forward-looking statements are subject to numerous risks and uncertainties, which could cause actual results to differ materially from those anticipated in these forward-looking statements. For a detailed description of these risks and uncertainties, please refer to the “Risk Factor” section of Danone’s Universal Registration Document (the current version of which is available at www.danone.com).

Subject to regulatory requirements, Danone does not undertake to publicly update or revise any of these forward-looking statements. This document does not constitute an offer to sell, or a solicitation of an offer to buy Danone securities.

The presentation to analysts and investors will be broadcast live today from 8:00 a.m. (Paris time)
on Danone’s website (www.danone.com).
Related slides will also be available on the website in the Investors section.


All references in this document to Like-for-like (LFL) changes and Recurring operating income and margin, correspond to alternative performance measures not defined by IFRS. Their definitions, and their reconciliation with financial statements, as well as the definitions of geographical zones, are listed on pages 3 and 4.

Attachment


FAQ

What were Danone's net sales in Q1 2024?

Danone's net sales in Q1 2024 reached €6,789m, up +4.1% on a like-for-like basis.

What was the volume/mix growth for Danone in Q1 2024?

Danone's volume/mix was up +1.2% in Q1 2024.

Where did Danone experience solid growth in Q1 2024?

Danone experienced solid growth in Europe, North America, and China in Q1 2024.

What was the 2024 guidance for Danone's like-for-like sales growth?

Danone's 2024 guidance confirms like-for-like sales growth expected between +3% and +5%.

DANONE S/ADR

OTC:DANOY

DANOY Rankings

DANOY Latest News

DANOY Stock Data

44.19B
3.19B
0.91%
Packaged Foods
Consumer Defensive
Link
United States of America
Paris