Danone earnings jump 14% in fiscal year
Feb. 16, 2011
by Jeff Gelski
PARIS — Groupe Danone recorded net income of €1,669 million ($2,251 million) for the fiscal year ended Dec. 31, 2010, which marked a 14% increase from €1,412 million ($1,905 million) in the previous fiscal year. Fiscal-year like-for-like sales rose 7% to €17,010 million ($22,945 million) from €14,982 million ($20,210 million) in the previous fiscal year.
“Continued high operating margin and a 20% rise in free cash flow are remarkable achievements in a year that saw a steep rise in raw material prices and the end of adjustments to sales prices under our reset program, which improved our competitive edge,” said Franck Riboud, chairman.
All four of Danone’s operations saw increases in like-for-like sales. Fiscal-year like-for-like sales of €9,732 million in Fresh Dairy marked a 6.5% increase from the previous fiscal year. Other increases came in Waters at 5.3% to €2,868 million, Baby Nutrition at 8.9% to €3,355 million and Medical Nutrition at 9% to €1,055 million.
Companywide in the fourth quarter ended Dec. 31, 2010, Groupe Danone had like-for-like sales of €4,299 million, up from €3,682 million in the fourth quarter of the previous fiscal year.
Groupe Danone has set a target of a 6% to 8% increase in like-for-like sales in fiscal year 2011. The company also expects total raw material and packaging costs to increase by 6% to 9% on average over the year.
“Danone will be drawing on its experience of 2010 to manage these increases through consistently high productivity,” the company said. “The group also will continue to use pricing to maintain competitive edge, benefitting from increased room for maneuver thanks to repositioning in 2009 (reset program).”