FRANCE: Danone shares slide despite H1 profits increase

By | 28 July 2011

  • First-half net profits rise by 6.3% to EUR925m (US$1.32bn)
  • Operating profits rise by 10.2% at EUR1.39bn
  • Net sales climb by 8.7% to EUR8.36bn
  • Waters sales growth of 16.6% to EUR1.45bn driven by favourable weather

Danone has seen its share price slide, despite an increase in half-year profits and rebounding bottled water sales.

Shares in Danone slid by 2% on the Paris Stock Exchange this morning (28 July), despite a 6.3% increase in group profits to EUR925bn (US$1.33bn) for the six months to the end of June. Operating profits was up 10.2% at EUR1.39bn.

Net sales reached EUR8.36bn, an 8.7% increase on the prior-year period.

Sales from Danone's waters division rose by 16.6% to EUR1.45bn, driven by favourable weather conditions in Western Europe and Latin America, and a surge in demand following the Japan earthquake.

Danone said that it has met its targets in a “persistently difficult environment shaped by trends in consumption and rising raw material prices”. Sales showed “remarkable growth in the first half," Danone said, "with our waters division doing particularly well”.

For the full-year, the company has targeted like-for-like sales growth of between 6% to 8%.

Click here to view the earnings release.

Expert analysis

Groupe Danone - SWOT Analysis

Datamonitor's Groupe Danone - SWOT Analysis company profile is the essential source for top-level company data and information. Groupe Danone - SWOT Analysis examines the company’s key business structure and operations, history and products, and provides summary analysis of its key revenue lines and strategy.Groupe Danone (Danone or ‘the group’) is engaged in the production and marketing of fresh dairy products and beverages. The group operates in Europe. It is headquartered in Paris, France and employs 80,976 people. The group recorded revenues of E14,982 million ($20,894.3 million) during the financial year ended December 2009 (FY2009), a decrease of 1.6% compared to FY2008. The operating profit of the group was E2,294 million ($3,199.3 million) in FY2009, an increase of 1.1% over FY2008. The net profit was E1,361 million ($1,898.1 million) in FY2009, an increase of 3.7% over FY2008.

Sectors: Company results, Soft drinks, Water

Companies: Danone

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