PARIS (dpa-AFX) - French diary giant Danone SA (DANOY.PK) posted 5.2% lower consolidated reported sales of 5.06 billion euros in the first quarter of 2014, versus 5.34 billion euros last year. Excluding the impact of changes in the basis for comparison, that include exchange rates and scope of consolidation, sales grew by 2.2%. This organic growth reflects a 1.9% decline in sales volume and a 4.1% improvement in value.
The company said the exchange-rate effect of -8.9% reflects unfavorable trends in the Argentine peso, the Russian ruble, the Indonesian rupiah, the Brazilian real and other currencies.
Sales for the Fresh Dairy Products unit went up 3.9% like-for-like in the quarter, including a 3.7% fall in volume and a 7.6% growth in value. Meanwhile, the Waters division once again recorded vigorous growth, with first-quarter 2014 sales up 8.9% like-for-like, buoyed by a 5.4% sales volume increase. This performance was driven by robust demand in emerging markets, especially in Asia, with growth for the Mizone brand and a very strong showing by Aqua, Danone added.
However, Early Life Nutrition unit's sales fell 7.7%, with a 4.8% drop in volume, reflecting high bases for comparison linked to the false safety alert triggered by Fonterra in August 2013. On the other hand, Medical Nutrition's sales rose 5.2% like-for-like, driven by a volume increase of 4.3%.
For the full year 2014, the group still sees like-for-like sales growth in the range of 4.5 - 5.5 percent, while expecting trading operating margin to be stable within a range of -20 bps and +20 bps, reflecting the flexibility that the Group seeks to manage its operations, especially for its Early Life Nutrition business in Asia.
Copyright RTT News/dpa-AFX