Danone has denied reports it is to scrap its V energy drink after reports this week that the beverage and food giant was axing it as a result of the product's flagging performance.

The company said the product remains a "strategically important" SKU for Danone Waters.

"We continue to support the brand fully and are currently working hard to develop our exciting brand plans for 2009," said Patrick Kalotis, marketing director Danone Waters.

Since taking on the management of V in 2006 Danone Waters has invested heavily in the brand, which it says has gone from "strength to strength" and is now worth nearly GBP5.7m (US$11.1m) in annual sales.

Last year, V was revamped and re-launched with the support of GBP3.3m - the second re-launch of the product.

Only recently, Danone axed its Citrus Kick drink, a variant of its functional water brand Volvic Revive.

The energy drinks sector reported a 4% decline in total-on-premise sales, according to the Britvic Soft Drinks Report 2008, with Red Bull the only product in this category remaining stable and posting a sales growth.