Food group Danone keeps goals despite weaker Q1 sales

Food group Danone keeps goals despite weaker Q1 sales

Danone said the sale of Earthbound Farm would help it improve its recurring operating margin in 2019.

Danone reiterated it was targeting like-for-like sales growth of around 3% for this year. (Reuters pic)
PARIS:
French food group Danone kept its forecasts for a further rise in sales and profits this year although weaker demand for infant formula products in China and a consumer boycott in Morocco weighed on first-quarter sales.

Danone, the world’s largest yoghurt maker, said its first-quarter underlying sales had risen 0.8% to 6.138 billion euros (US$6.94 billion).

The performance was broadly in line with a company-compiled median forecast, based on 18 analyst estimates, of 0.7% like-for-like growth in group sales, yet marked a slowdown from 2.4% growth in the fourth quarter of 2018.

For 2019, Danone reiterated it was targeting like-for-like sales growth of around 3% and an operating margin above 15%.

Danone said the sale of Earthbound Farm, which it had obtained via the US organic salad business it inherited from its 2017 acquisition of WhiteWave, would help it improve its
recurring operating margin in 2019.

Danone added it was on track to deliver on its 2020 goals for an operating margin above 16% of its sales and like-for-like sales growth of 4-5%.

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