Investing.com - Danone SA (EPA:DANO) on Wednesday reported third-quarter organic sales growth of 4.0%, surpassing the analyst consensus of 3.7%, though the beat was driven primarily by pricing rather than volume growth.
The French food and beverage company's organic volume and mix came in at 0.4%, missing the consensus estimate of 1.1%, while pricing reached 3.6%, well ahead of the 2.7% consensus. Specialized Nutrition delivered organic sales growth of 4.7%, exceeding the 4.1% estimate, though China Specialized Nutrition slowed to mid-single digits.
North America growth disappointed at 2.4% versus the 3.7% estimate, as Essential Dairy and Plant-Based products continued to struggle, prompting the immediate appointment of new U.S. leadership. Waters organic sales growth of 3.6% missed the 4.1% consensus, impacted by Mizone Waters destocking in China, which weighed 1 percentage point on group growth.
Regional performance was mixed, with EMEA beating expectations at 3.9% organic sales growth versus the 3.0% consensus, while Americas delivered 4.4%, in line with estimates. China sales growth decelerated sharply to 0.1% from 3.6% in the second quarter, with negative volumes of -1.6% in the China and North Asia Oceania region.
Danone reiterated its fiscal 2026 organic sales growth guidance of 3-5%, with the midpoint of 4.0% in line with the analyst consensus of 3.7%. The company expects operating profit to grow ahead of sales, suggesting moderate margin expansion, with consensus operating margin at 13.6% versus 13.4% in the prior year.
The company previously indicated that the infant formula recall impact would be approximately 1 percentage point for the full year, though no update was provided in the third-quarter results.
Essential Dairy and Plant-Based organic sales growth was 3.6%, matching estimates of 3.3%, while the APAC region delivered 3.6% growth, in line with the 3.7% consensus.
Original Article
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