Sales at Danone Hurt by China
18 Oct 2016 --- Changes to the regulatory framework in China contributed to sales falling 1.8 percent at Danone in the third-quarter, but dairy like-for-like sales grew.
The company behind brands such as Actimel and Evian reported sales of €5.54 billion ($6.1 billion) in the three months to September, which were slightly below analysts' expectations.
Earlier this year, China introduced new rules which stopped companies selling infant formula outside of China at lower prices.
Danone Chief Executive Emmanuel Faber said: “While China is transitioning, creating short-term volatility and negatively impacting our sales growth in Q3, we have continued to build a solid growth agenda, leveraging the fundamentals of our unique business portfolio, and the growth potential of our brands in each of our categories."
Across its Fresh Dairy portfolio, which includes yogurt brand Actimel, sales were down from €2.71bn ($2.99bn) to €2.67bn ($2.94bn) on the year.
It said its market share in North America continued to grow, reaching a record high of 36 percent but it said the business environment in Russia remained tough across dairy.
Sales nudged down from €1.31bn ($1.44bn) to €1.24bn ($1.37bn) across its Waters division, after it was hurt by an "unfavorable sales trend in China".
In Europe, it said its sales were strong in its Waters division, despite poor weather in July.
