Danone SA unveiled a 1 billion euro ($1.06 billion) cost-cutting plan as the world’s largest yogurt maker said the turnaround of its fresh dairy unit is taking longer than expected and it continued to be pressured by its business in China.
On Wednesday, Danone said its like-for-like sales, a measure closely watched by analysts, rose 2.9% in 2016, a slowdown on the 4.4% growth it posted the previous year.
The company blamed the slowdown on problems in Europe, including the relaunch in Europe of its Activia yogurt product and weak sales in Spain. New regulation in China also weighed on baby food sales there.
Danone said it would continue to focus on improving margins in 2017 but didn’t provide a sales or profitability target for the year, adding that it would review its financial targets after it completes its $10.4 billion acquisition of U.S. organic-foods producer WhiteWave Foods Co., which it expects to happen in the first quarter.
The French food group said its 2016 net profit rose 34% to EUR1.72 billion, reflecting tight cost-control. Full-year sales fell to EUR21.94 billion, down 0.2% from EUR22.41 billion in 2015.
Sales for the most recent quarter ended Dec. 31 fell to EUR5.36 billion from EUR5.38 billion, pressured by unfavorable exchange rates.
The company increased its dividend to EUR1.70 a share, a rise of 6.3% on the previous year.
By Nick Kostov
Source: MarketWatch
McCain Foods has completed the acquisition of Irish plant-based frozen food manufacturer Strong Roots. The acquisition follows McCain and Strong Roots’ strategic partnership, which began in 2021 and resulted from a $55 million investment.
Cargill partners with Voyage Foods to scale up alternatives to cocoa-based products to meet consumers’ indulgence needs. The commercial partnership will also provide food manufacturers with nut spreads produced with no nut or dairy allergens used in the recipe formulation.
L’Occitane International owner Reinold Geiger is reportedly close to taking the company private in a deal with Blackstone. The French skin care company’s filing halted trading of its Hong Kong-listed shares this week. This is the second time in months that the Australian billionaire has attempted a buyout.