French company Danone raises 2022 sales outlook after Q2 sales beat forecasts By Reuters

© Reuters. FILE PHOTO: A Danone logo is seen on a product displayed in Paris, France, February 26, 2020. REUTERS/Christian Hartmann/File Photo

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.