FRANCE – French multinational food company Danone has reported a 3.8% rise in third quarter sales mainly driven by organic contribution of hyperinflation in various geographies where it operates.
Danone further noted that its third-quarter sales amounting to €6.158bn ($7.18bn) were also partly boosted by the combined effects of the integration of Harmless Harvest and Follow Your Heart and the disposal of Vega.
Growth was robust across all regions with Europe and North America posting a 3.9% growth on a like-for-like basis, driven by the sustained momentum in the Essential Dairy and Plant-Based division (EDP) and the recovery of Waters in Europe.
Sales in the rest of the world increased by 3.7% on a like-for-like basis, led by the performance of Specialized Nutrition in China.
EDP posted sales growth of 4.1% in Q3 2021 on a like-for-like basis, reflecting a 0.6% increase in volume and 3.5% in value.
Specialized Nutrition sales increased by 2.9% in Q3 2021 on a like-for-like basis, with a decrease of 5.3% in volume and an increase of 8.2% in value.
Adult Nutrition delivered mid-single-digit growth, led by China and other emerging platforms, growing double-digits, while Europe delivered another quarter of growth.
The performance of the plant-based portfolio was impacted this quarter by supply and logistic disruptions hampering Danone’s ability to produce and serve customer demand.
“Today’s results further underscore our progress to profitable growth. Our actions and focused delivery across all parts of the company ensured that all categories contributed to a solid performance this quarter,” said Juergen Esser, chief financial officer at Danone.
“We see clear evidence of our brands’ strengths and relevance to the global health and wellness agenda. Our Essential Dairy and Plant-based business continued its strong momentum, particularly in Europe and North America, with market share gains on key platforms.”
Despite of a convincing Q3 result, Danone has warned that growing inflationary pressures will continue impacting the business well into the next year.
The company has however reiterated that it expects its full-year 2021 recurring operating margin to be broadly in line with the 14% achieved last year, banking on productivity gains and pricing to counter inflationary pressures.
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