Danone Backs Guidance After Sales, Volumes Beat Expectations

By Michael Susin

Danone backed its guidance for the year after first-quarter like-for-like sales rose ahead of expectations, with volume growth across all regions and categories.

The French food company on Thursday said it expects like-for-like sales growth of between 3% and 5% in 2024, and confirmed that it anticipates a moderate improvement in recurring operating margin.

The company said sales grew 4.1% on a like-for-like basis in the first quarter, with 2.9% growth from pricing and 1.2% from volume. A company-compiled market forecast estimate expected LFL growth of 3.4%, comprised of 2.7% price and 0.8% volume growth.

However, on a reported basis, sales for the quarter fell to 6.79 billion euros ($7.25 billion) compared with EUR6.96 billion in the same period a year ago, but came in ahead of the market estimate of EUR6.695 billion based on 17 analysts' estimates.

The company said it had a solid start to the year in Europe and North America as pricing normalized, with 2.8% and 2.5% LFL growth, respectively.

Danone's waters and specialized nutrition divisions registered LFL sales increases of 8.1% and 3.8%, respectively, while the essential dairy and plant-based business reported a 3.0% sales increase.

"In what remains a challenging environment, we continued making good progress on our transformation agenda," Chief Executive Antoine de Saint-Affrique said.

Write to Michael Susin at michael.susin@wsj.com

(END) Dow Jones Newswires

April 18, 2024 01:47 ET (05:47 GMT)

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