FRANCE: Groupe Danone waters stay strong on H1 Asia growth

By | 29 July 2013

Danones water unit posted strong sales growth

Danone's water unit posted strong sales growth

Groupe Danone has reported a solid rise in H1 sales in its bottled water division, as “vigorous growth” in Asia boosted the unit's performance.

The French conglomerate, whose water brands include Volvic and Evian, said today (29 July) that its water unit's sales in the six months to the end of June were up by 9.6% to EUR1.99bn (US$2.64bn). Volumes in the unit also grew, by 5.9%.

Second-quarter sales grew by 10.5% with a 7.1% jump in volumes, eclipsing the first-quarter, when sales rose by 5.5%.

Europe, in contrast to Asia's emerging markets, saw sales continue to fall because of “adverse weather conditions”, Danone said.

Overall group sales grew 6% to EUR11.05bn in the first half, with Q2 sales up 6.5%, beating the consensus forecast among analysts of a rise of 5.7%.

In Europe, excluding the Commonwealth of Independent States (CIS), Danone said half-year group sales were down 4% year-on-year. However, its North American and CIS sales were up 9.3%, while the group's Asia-Pacific, Latin America, Middle East and Africa region saw sales increase 15.9%.

Danone reaffirmed its outlook for full-year sales growth of “at least” 5%. The company said it expected operating margins to fall by 30-50 basis points and that free cash-flow is expected to total around EUR2bn.

Shares in Danone were up 3.22% at EUR59.31 at 11:54 CET.

Danone chairman & CEO Franck Riboud said a restructuring plan in Europe that will cut around 900 jobs is “right on schedule, with the first benefits expected from the second semester onwards”.

To read the company's official statement, click here.

Expert analysis

Danone , Groupe in Soft Drinks (World)

Danone is the global leader in bottled water. Danone has been successful at developing local and regional brands in emerging markets to support growth. In 2012, Bonafont, based almost entirely on Mexican sales, overtook Evian in value sales terms as the company’s largest bottled water brand. Further potential exists for growth in markets such as Brazil and China.

Sectors: Company results, Water

Companies: Danone, Evian

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FRANCE: Groupe Danone waters stay strong on H1 Asia growth

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Danone , Groupe in Soft Drinks (World)

Danone is the global leader in bottled water. Danone has been successful at developing local and regional brands in emerging markets to support growth. In 2012, Bonafont, based almost entirely on Mexican sales, overtook Evian in value sales terms as ...

Danone , Groupe in Soft Drinks (World )

Danone saw slight recovery in sales of bottled water in some developed markets; however, the company is still facing tough challenges in southern Europe and weakened consumer purchasing power in most developed markets. The company has not made major ...

Danone Waters Deutschland GmbH in Soft Drinks (Germany)

Danone Waters Deutschland GmbH is the second biggest player in bottled water in Germany. The company offers different brands within bottled water, including Volvic and Evian. Its main strategy is to focus on its core brands, using intensive marketing...

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