PARIS (Reuters) – Danone raised its 2022 revenue growth outlook after posting a 7.7% jump in second quarter like-for-like sales – beating analysts’ forecasts for 5.6% growth – reflecting price increases and strong demand for baby food and bottled water.
Danone, which is the world’s largest yoghurt maker, said it now expected like-for-like sales growth in a 5-6% range this year compared with a previously forecast 3-5% range.
The consumer goods giant, whose brands include Evian and Badoit water and Activia yoghurt, said its first-half recurring operating margin declined to 12.1% of sales from 13.1% in the first half of 2021, due to higher input cost inflation.
Danone reiterated it expected its full year recurring operating margin to be above 12%, versus 13.7% in 2021.
Danone’s new chief Antoine de Saint-Affrique is pursuing a revival plan amid mounting input costs and uncertainties caused by Russia’s invasion of Ukraine, which has forced Danone to suspend investments in Russia.
(Reporting by Dominique Vidalon; Editing by Sudip Kar-Gupta)