Danone’s H1 2024 results show a 2.1% increase in global volume and 4% LFL sales growth, despite a 2.9% decrease in reported sales. The company has invested in medical nutrition and plans further expansion, while setting optimistic targets for the year.
Danone, a global leader in the food and beverage industry, has reported strong financial results for the first half of 2024, reflecting its ability to navigate a complex market environment. Despite external challenges, the company achieved a 2.1% increase in global volume and a 2% rise in prices, resulting in a 4% sales growth on a like-for-like (LFL) basis. However, reported sales saw a slight decline of 2.9% year-on-year, from €14,167 million in 2023 to €13,757 million in 2024, primarily due to negative impacts from changes in scope and the foreign exchange market.
Geographic Performance and Financial Metrics
Danone’s LFL sales growth was observed across all five geographic zones, demonstrating the company’s robust and diversified global presence. Europe, a key market for Danone, experienced a 1.7% increase in LFL sales. Reported sales in the region grew by 2.3%, although volume growth was marginal at 0.1%, indicating a competitive market environment and consumer demand stability. In North America, Danone continued to strengthen its market position, driven by successful product launches and strong consumer engagement in the plant-based and dairy segments.
In addition to its regional successes, Danone reported a 0.7% increase in recurring operating income, reaching €1.746 million. Recurring earnings per share grew by 2.6% year-on-year, signaling the company’s strong financial health and operational efficiency. These results are consistent with Danone’s focus on optimizing its product mix and driving efficiency across its supply chain.
Looking forward, Danone has set its 2024 guidance with expectations of 3% to 5% LFL sales growth, alongside a moderate improvement in its recurring operating margin. These targets underscore the company’s confidence in its strategic direction and its ability to deliver sustained growth amidst economic uncertainties.
Strategic Investments and Portfolio Expansion
Danone continues to execute on its growth strategy through targeted investments and portfolio expansion. A notable development in H1 2024 was the acquisition of Functional Formularies, a US-based company specializing in whole foods tube feeding. This acquisition enhances Danone’s position in the medical nutrition sector, a high-growth area that aligns with the company’s mission to bring health through food to as many people as possible.
In addition to expanding its product offerings, Danone announced a €70 million investment in a new facility in Steenvoorde, France. This facility will focus on the development and production of specialized nutritional products aimed at patients suffering from disease-related malnutrition. This investment is part of Danone’s broader strategy to address unmet nutritional needs and reinforce its leadership in the medical nutrition market.
CEO’s Vision and Future Outlook
Danone’s CEO, Antoine de Saint-Affrique, has emphasized the importance of driving growth through innovation and category leadership. Under his leadership, Danone has focused on key platforms such as High Protein, Medical Nutrition, Coffee Creations, and Away-from-home, which have been instrumental in driving the company’s performance in H1 2024.
Danone is also committed to enhancing its core portfolio, which includes a wide range of dairy, plant-based, and specialized nutrition products. The company’s efforts to rebuild its fundamentals through the “Renew Danone” initiative are creating a solid foundation for future growth. This initiative is designed to streamline operations, enhance product quality, and strengthen Danone’s competitive position in key markets.
Commitment to Sustainability
In addition to its financial and strategic achievements, Danone continues to priorities sustainability as a core component of its business model. The company is actively working to reduce its environmental footprint through initiatives focused on water conservation, sustainable sourcing, and reducing greenhouse gas emissions. These efforts are aligned with Danone’s broader commitment to social and environmental responsibility.
Danone’s performance in the first half of 2024 highlights the company’s resilience and strategic agility in a dynamic market environment. With a clear focus on growth, innovation, and sustainability, Danone is well-positioned to achieve its financial targets for the year and continue delivering value to its stakeholders. The company’s ongoing investments in high-potential areas, such as medical nutrition and plant-based products, signal a commitment to long-term growth and leadership in the global food and beverage industry. As Danone continues to execute on its strategic priorities, it remains a key player in shaping the future of food and nutrition on a global scale.
