Critical Year For Danone

 Breaking News
  • Patent War Looms as Cannabis Legalisation Spreads The recent legalisation of recreational marijuana use in Canada indicates a broader trend of a move towards legalisation, opening up a brand new multi-billion dollar market. Currently, 22 states in the USA have legalised marijuana for medicinal use, with nine states and the District of Columbia having legalised marijuana for both recreational and medicinal use. [...]...
  • New Food Lounge Opened at Moy Park Grantham Moy Park has unveiled its new Food Lounge at its Grantham processing facility following a £450,000 investment. The creative space includes a state-of-the-art kitchen, BBQ area, culinary library and a breakout area for customers. The Lounge will be used by the company for food innovation and development. The opening comes as Moy Park launches its latest [...]...
  • Better Juice Reduces All Types of Sugar in Juice Better Juice has developed innovative technology to reduce the load of simple sugars in orange juice. The patent-pending enzymatic technology uses all-natural ingredients to convert monosaccharides and disaccharides (fructose, glucose, and sucrose) into prebiotic and other non-digestible fibers and sugars, while keeping the juicy flavour of the beverage. Popular juices, such as orange juice and apple [...]...
  • Hilton to Purchase 50% of Leading Vegetarian Manufacturer Hilton Food Group, the leading specialist international food packing business supplying major food retailers in Europe and Australia, has agreed to purchase a 50% shareholding in Dalco Food, a leading vegetarian product manufacturer based in Oss, the Netherlands. Hilton has agreed to enter into a joint venture agreement with Dalco’s shareholders, which includes an option [...]...
  • Great British Cheese Awards Winners Announced The winners of the Great British Cheese Awards have been announced. The Great British Cheese awards were established three years ago to celebrate the best of British cheese produced and distributed by independent cheese makers and retailers and this year, both established artisan brands and new cheesemakers have taken top awards. The category winners are: Artisan Producer – Tenacres, [...]...

Critical Year For Danone

Critical Year For Danone
February 24
12:39 2015

Danone has reported a 4.7% increase in like-for-like net sales to €21.14 billion for 2014, despite a 1.5% fall in sales volume. On a reported basis sales slipped 0.7% and the 2014 trading operating margin at 12.59% was down 12bps like-for-like from 2013.

The negative impact of fluctuations in exchange rates was 5.5%, reflecting a marked decline in certain emerging currencies, including the Russian ruble, the Argentine peso and the Indonesian rupiah. As expected, the consequences of the false alert on quality triggered by Fonterra in August 2013 and the decline in sales of Dumex brand products in China in particular continued to undermine the company’s growth and profitability in 2014.

Key developments during the year included a very steep rise in the cost of milk and dairy ingredients. This surge was offset by solid growth trends, by selective and competitive price increases, by optimization of the mix, and by additional efforts to reduce costs. A focus on optimizing raw material, production and logistics costs led to continued high productivity. In addition, most of the cost reduction plan for Europe was finalized by the end of 2014 and delivered the savings anticipated.

Franck Riboud, Chairman of Danone, comments: “2014 was a critical year for Danone, with a number of major transformations aimed at preparing our company for the future. In particular, we outlined the key points of Danone 2020, our roadmap to a new stage in development. We also adopted a new structure that will help us roll out this initiative over time, while meeting immediate challenges. This was why we decided to create a role of Chairman with strengthened duties, focusing on medium- and long-term strategy, while entrusting a CEO and management team with responsibility for guiding day-to-day operations.”

Emmanuel Faber, CEO of Danone.

Emmanuel Faber, CEO of Danone.

“Our 2014 achievements laid a solid foundation for Danone to build on in 2015 and the years ahead,” says Emmanuel Faber, CEO of Danone. “In the course of the year, we also made significant progress in many markets, especially in Europe where a combined focus on updating our product lines and raising our competitive edge are beginning to pay off. We also continued to build our portfolio and expand in high-growth markets, particularly in Asia and Africa.”

Danone expects that economic conditions will remain difficult and unstable overall in 2015, with fragile or even deflationary consumer trends in Europe, emerging markets undermined by volatile currencies, and difficulties specific to a few major markets, in particular the CIS.

DanoneIn 2015, Danone also anticipates marked but varied trends in the cost of major strategic raw materials, particularly milk.

Against this backdrop, Danone will focus on developing its product categories and winning market share. In Europe, the company will continue to strengthen its competitive edge. In growth markets, it will focus on developing its product categories, in particular through strong local brands in the most attractive geographical markets.

After delivering profitable growth in the second half of 2014, Danone will seek to maintain this position, generating organic growth in sales and in operating margin in 2015, while making the investments necessary to ensure this performance is lasting.

Danone’s 2015 targets include organic growth in sales of between 4% and 5% and a slight growth in trading operating margin. The group will also continue to work towards lasting gains in free cash-flow without setting a short-term target.

About Author



Related Articles

Food & Drink Business Conference & Exhibition 2016

Upcoming Events

  • October 21, 2018Int'l Food Products Exhibition (Sial)
  • October 25, 2018Italian Espresso Coffee Show (TriestEspresso Expo)
  • October 25, 2018Finnish Food Fair
  • October 31, 2018Int'l exhibition for food products and equipment (Indagra Food)
AEC v1.0.4

find food jobs

The Magazine

F&D Business Preferred Suppliers

New Subscriber

Subscribe Here