Danone impacted by pandemic in Q1 as Coca-Cola sees slight recovery

FRANCE – French dairy giant Danone and US beverage company Coca Cola have released their Q1 results, reporting mixing results as the pandemic continues to impact business operations across the globe.

For the French dairy, sales declined 3.3% on a like-for-like (LFL) basis to €5.66 billion (about US$6.80 billion), affected largely by a 7.7% drop in its Specialized Nutrition unit and an 11.6% decline in water sales.

Its noteworthy to mention that the company’s Essential Dairy and Plant-based (EDP) division managed to record a 1.5% LFL growth in sales to €3.15 billion (about US$3.78 billion).

Within its EDP unit, Europe and North America delivered solid growth thanks to probiotics, protein and plant-based.

Danone’s plant-based portfolio grew well into double digits in Europe; while essential dairy saw broad-based market share gains led by Actimel, Danette and YoPro.

The company’s Waters division howeve, continued to be impacted by out-of-home trends, but showed sequential improvement compared to previous quarters, especially in Europe.

Despite the less than satisfactory results, the company has reiterated its goal of returning to growth in Q2, betting its recovery on the gradual reopening of economies as vaccination programmes are rolled out.

While a search is underway for a replacement to Emmanuel Faber , Véronique Penchienati-Bosetta and Shane Grant continue to perform their role of interim co-CEOs.

Coca-Cola sees slight recovery from pandemic

Meanwhile, leading US beverage company Coca-Cola has reported 5% growth in net revenue for its first quarter, as coronavirus-related uncertainty eases in some markets.

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The owner of Coke and Fanta beverage brands reported net revenue of US$9.0 billion in the Quarter ending March, boosted by 5% growth in concentrate sales, and a 14% rise in operating income.

According to Coca-Cola, volume trends steadily improved each month, driven by recovery in markets where coronavirus-related uncertainty has diminished, and volumes returned to 2019 levels in March.

In Q1, nutrition, juice, dairy and plant-based beverages grew 3%, while sparkling soft drinks grew 4%, with growth for both trademark Coca-Cola (4%) and sparkling flavours (2%).

Meawhile, Coca-Cola’s hydration, sports, coffee and tea category declined 11%, with coffee witnessing a 21% drop driven by coronavirus-related pressure on Costa retail stores, while hydration declined 12%.

Unit case volume declined 2% in Europe, the Middle East & Africa, primarily due to coronavirus-related pressure in away-from-home channels in Europe, while North America saw a 6% decline.

These case declines in EMEA and North AMerica were offset by a 9% growth  in the Asia Pacific region, driven by strong growth in China and India. In Latin America, unit case volume was flat.

“We remain focused on emerging stronger and executing against our growth accelerators during the recovery phase. We are pleased with the progress we are making,” said James Quincey, chairman and CEO of The Coca-Cola Company.

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