PARIS: Danone is counting on baby food sales in China to help power annual earnings higher despite setbacks in Morocco and Brazil that slowed second quarter sales, the French food group said on Friday.
“We are entering the second half with an operating model capable of offsetting these headwinds,” Chief Financial Officer Cecile Cabanis said on Friday, referring to a boycott in Morocco and a trucking strike in Brazil.
Danone “will progress toward its 2020 ambition through further sales growth and an improved recurring operating margin,” the group said in a statement.
Second-quarter like-for-like sales rose 3.3 percent, topping the 3.1 percent expected by analysts.
This beat the 2.6 percent reported by rival Nestle but marked a slowdown from 4.9 percent in the first quarter.
Danone is targeting like-for-like sales growth of 4-5 percent by 2020 and an operating margin above 16 percent. It reported a margin of 14.27 percent for the first half.
Shares in the world’s largest yoghurt maker were up 1.9 percent in early trading. Brokerage Liberum described the results as “solid” and kept its “buy” rating on Danone.
Operating profit rose 7.9 percent in the first half helped by cost controls and its takeover of US organic food maker WhiteWave last year.
Chinese demand for baby food and sales at its water division remained solid while its dairy business in North America returned to growth in the second quarter.
The boycott in Morocco was launched earlier this year on social media against what protesters say are unfair prices set by large companies.
Danone, which makes 6 percent of its group sales in Morocco, said last month its local dairy unit Centrale Danone had lost more than 50 percent of its fresh milk market share due to the boycott.
Cabanis said Danone was seeking to regain consumer trust.
“Sales continued to decline in Brazil where the truckers’ strike exacerbated already difficult market conditions,” Danone said in its statement.
Danone keeps growth outlook despite Morocco boycott
Danone keeps growth outlook despite Morocco boycott
- Second-quarter like-for-like sales rose 3.3 percent, topping the 3.1 percent expected by analysts
- Danone makes 6 percent of its group sales in Morocco
BYD Americas CEO hails Middle East as ‘homeland for innovation’
- In an interview on the sidelines of Davos, Stella Li highlighted the region’s openness to new technologies and opportunities for growth
DAVOS: BYD Americas CEO Stella Li described the Middle East as a “homeland for innovation” during an interview with Arab News on the sidelines of the World Economic Forum.
The executive of the Chinese electric vehicle giant highlighted the region’s openness to new technologies and opportunities for growth.
“The people (are) very open. And then from the government, from everybody there, they are open to enjoy the technology,” she said.
BYD has accelerated its expansion of battery electric vehicles and plug-in hybrids across the Middle East and North Africa region, with a strong focus on Gulf Cooperation Council countries like the UAE and Saudi Arabia.
GCC EV markets, led by the UAE and Saudi Arabia, rank among the world’s fastest-growing. Saudi Arabia’s Public Investment Fund has been aggressively investing in the EV sector, backing Lucid Motors, launching its brand Ceer, and supporting charging infrastructure development.
However, EVs still account for just over 1 percent of total car sales, as high costs, limited charging infrastructure, and extreme weather remain challenges.
In summer 2025, BYD announced it was aiming to triple its Saudi footprint following Tesla’s entry, targeting 5,000 EV sales and 10 showrooms by late 2026.
“We commit a lot of investment there (in the region),” Li noted, adding that the company is building a robust dealer network and introducing cutting-edge technology.
Discussing growth plans, she envisioned Saudi Arabia and the wider Middle East as a potential “dreamland” for innovation — what she described as a regional “Silicon Valley.”
Talking about the EV ambitions of the Saudi government, she said: “If they set up (a) target, they will make (it) happen. Then they need a technology company like us to support their … 2030 Vision.”
