Groupe Danone today (22 October) booked an 8.3% rise in third-quarter sales due to higher prices for the French firm’s dairy products and continued growth from its baby nutrition division.
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The company booked revenue of EUR3.84bn (US$4.96bn) for the three months to the end of September, a rise of 8.3% on an organic basis.
The result meant Danone could hold firm its targets for 2008. The company expects annual like-for-like sales growth of 8-10% and an increase of trading operating margin of between 40 and 50 basis points. The group is also targeting underlying fully diluted earnings per share growth of at least 15%.
During the third quarter, sales from Danone’s fresh dairy business climbed 8.2% to EUR2.2bn, despite volumes dipping 0.2%, as the company upped prices.
Danone did see volumes rise at its baby nutrition division even after the company increased prices. Volumes rose 5.1%, helping the business post a 12.7% jump in sales to EUR692m.
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By GlobalDataThe company’s water sales, however, were held back by falling volumes in Europe. Difficulties in France, Spain and the UK hindered the performance of the unit, which nonetheless saw sales rise 3.7% to EUR733m thanks to growth in Asia and Latin America.
On a geographic basis, Danone saw group sales rise 4.9% in Europe to EUR2.37bn. Turnover from its Asian businesses climbed 13.8% to EUR477m, while revenue from Danone’s rest of world unit was up 14.3% to EUR1bn.
Chairman and CEO Franck Riboud labelled Danone’s third-quarter results as “solid and satisfactory”.
He said: “This performance again reflects the relevance of the business lines we have chosen to be in and the geographic priorities we have set.”
