Corporate Profiles - 2024 - 62

COMPANY overview
Danone SA
In company's renew strategy, health and
nutrition take center stage
D
anone SA plans to focus over the next three
years on innovation, operational discipline
and proactive management.
Antoine Bernard de Saint-Affrique, chief executive
officer, said during a June 20 investor day
presentation in Amsterdam the Paris-based company's
" renew strategy " will help to align it with
the future of health and nutrition where the role
food plays will become more critical.
" We now have the right fundamentals in place
to turn Danone into a truly science-based, consumer-
and patient-centric company with an even
stronger focus on our unique health-focused mission, "
he said.
De Saint-Affrique characterized the past two
years as a period of " radical transformation "
that saw the global consumer packaged goods
microbiome and the protein space.
Danone also is partnering with Microsoft on a
Chief executive officer -
Antoine Bernard de Saint-Affrique
company grapple with a governance crisis and a
significant restructuring. Today's Danone is much
stronger, he said, and more changes are coming,
especially for the 2025-28 period.
Danone sold its Horizon Organic and Wallaby
brands, launched a line of yogurt and dairy snacks,
invested in a precision fermentation partnership
and acquired a feeding tube company this year.
Additional acquisitions may come in the medical
nutrition category as Danone pivots to offering
more science-based products that combine
health and consumer goods across categories.
Examples de Saint-Affrique cited include the gut,
62 \ October 2024
multi-year integration of artificial intelligence (AI)
across its operations. The companies are launching
a Danone Microsoft AI Academy to ensure Danone
employees have the digital tools required to successfully
negotiate an AI-driven economy.
The company posted a 12% earnings gain for
the first half of this fiscal year due to pricing and
volume/mix gains, although the effects of foreign
exchange and deconsolidation of the Essential
Dairy and Plant-based business in Russia created
headwinds. Adjusted earnings rose 2.6%.
Net income for the first-half period of €1.22 billion
($1.32 billion) was up from €1.09 billion in the
first half of the previous year. Net sales fell 2.9% to
€13.78 billion ($14.86 billion) from €14.17 billion,
but like-for-like sales increased 4%.
Danone's outlook for the 2025 fiscal year
projects like-for-like sales growth of between 3%
and 5%. Some of the growth is expected in North
America, where volume/mix and resilient pricing
have played a role in boosting like-for-like sales.
Yogurt products, particularly the Oikos brand, plus
Danone's Coffee Creations business and its Evian
bottled water brand, showed first-half momentum
in North America, the company said.
Danone has acknowledged a need to build
market share for its US plant-based business
by price-correcting to increase competitiveness,
a move the company said has become a more
pressing issue for CPG companies as US consumers
respond to inflation by becoming more
cost-conscious.
Other changes during the next three years likely
will see Danone shift how it handles its protein
and gut health categories, ramp up its business
models in the Away-From-Home and Medical
Nutrition categories and expand its footprint to
become what de Saint-Affrique called " a truly
multichannel company. "
" We are now running the ship with better visibility,
with better control and also with better
clarity on the role and contribution of each country
and each function, " he said at the investor day
presentation. CP
Danone SA net income
in millions of euros
2023
€2,283
2022
€2,205
2021
Source: Danone SA
€2,165
Danone SA net sales
in millions of euros
2023
€27,619
2022
€27,661
2021
€24,281
Source: Danone SA
Danone SA share price
Sept. 4, 2024 = €64.18
€47
€52
€57
€62
€67
Sept. Nov.
2023
HIGH =
September 4, 2024 = €64.18
LOW =
Oct. 6, 2023 = €49.50
Jan.
2024
Source: Euronext Paris
DANONE SA
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Corporate Profiles - 2024

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