Danone 2011 Sales Grow 13.6 percent, Overall Profits Down

Feb 15 2012 --- French yoghurt, dairy and bottled water company Danone SA have released their financial statistics for the year 2011. Despite a rise in sales, the company reported a fall in full-year profit. This was attributed chiefly to continued integration costs related to Russia’s Unimilk and a rise in the cost of debt.

Net profit in 2011 totaled €1.67 billion ($2.19 billion), down from €1.88 billion a year earlier, while sales rose 13.6% on a reported basis to €19.32 billion from €17.01 billion, boosted by the acquisition of UniMilk and strong growth in emerging markets.

 

Danone's earnings before interest and taxes grew 9.2% like-for-like to €2.84 billion from €2.6 billion a year earlier, corresponding to an operating margin of 14.72%, down from 15.6% a year earlier.

 

On a like-for-like basis, sales rose 7.8%, in line with the company's guidance of between 6% and 8%, driven by a 3% increase at its main dairy division, which includes the Activia and Actimel brands, and 23.3% growth in its waters division.

 

Annual underlying net profit rose 4.5% to €1.75 billion, from €1.67 billion in 2010.

 

The company expects an increase of between 5% and 7% in net sales on a like-for-like basis for 2012 — which means excluding acquisitions and at constant exchange rate — with a stable full-year trading operating margin and a continued rise in free cash flow, which should reach €2 billion.

 

The company’s CEO Frank Riboud evaluated the results: “Markets in Latin America and the Africa/Middle-East region remained extremely vigorous, with continued double-digit growth, while Europe held steady. Sales increased in North America, building the position of the Oikos brand in the Greek yogurt segment, which is now driving growth for the entire category.

 

"For 2012, the Group expects no significant improvement or decline in the macroeconomic environment from the second half of 2011," he concluded.