Danone says 2013 will be "transitional"

Danone says 2013 will be "transitional"

Groupe Danone has reported a "solid" rise in Q1 sales in its bottled waters division, with emerging markets continuing to boost the unit's performance.

The French conglomerate, whose water brands include Volvic and Evian, said today (16 April) that the unit's sales in the three months to the end of March were up by 5.5% to EUR887m (US$1.2bn). Volumes in the unit also grew, by 4.6%.

The company said that "vigorous" growth in emerging markets continued to drive the division. It also flagged a "postive" price/mix effect from growth in flavoured natural water and tea beverages.

However, water sales in Europe "edged down" in the period, due to cold weather in March.

The company also highlighted innovations, including a version of Evian aimed at infants - Evian Baby Go - launched in France. 

Group sales, including dairy and baby food, were up 5.6% in the quarter at EUR5.1bn. 

Looking ahead, the company said it expects 2013 to be a "transtional year" as the cost of raw materials and packaging remains "high". 

"The group will continue to adapt its model in Europe, stepping up the pace of updates to its product ranges in response to consumers’ changing needs, and at the same time adapting its structures and costs to achieve EUR200m in savings by the end of 2014." 

In February, Danone announced it was cutting around 900 jobs from its European operations.