BN Danone

By Giulia Petroni

Danone SA reported its full-year results on Wednesday. Here's what we watched:

SALES: Full-year sales rose 2.6% on a like-for-like basis to 25.29 billion euros ($27.46 billion), up from the previous year and ahead of a consensus provided by Danone that expected sales at EUR25.25 billion.

NET INCOME: Danone reported a full-year net profit of EUR1.93 billion, compared with EUR2.35 billion the year previous. An analyst consensus provided by the company saw net profit at EUR2.49 billion.

WHAT WE WATCHED:

-GUIDANCE: The company revised its guidance for 2020 and said it now targets mid-single-digit recurring earnings per share growth and like-for-like sales growth of between 2% and 4% from a previously targeted 4% to 5% growth. It also targets a recurring operating margin above 15%.

Beyond 2020, Danone expects to deliver recurring EPS growth in the mid-to-high-single digits with a 3% to 5% sales growth on a like-for-like basis.

-CORONAVIRUS: Danone said it estimates a sales loss of around EUR100 million in the first-quarter of 2020 due to the coronavirus outbreak, adding its Waters business in China was the most impacted.

-CLIMATE PLAN: Danone plans to spend EUR2 billion over the next three years to fight climate change through agriculture, packaging and digital technology. "The challenge will be keeping all stakeholders aligned through a period of great change," analysts at Davy Research say. "For now, we applaud the move while recognising the inherent uptick in volatility."

Write to Giulia Petroni at giulia.petroni@wsj.com

(END) Dow Jones Newswires

February 26, 2020 09:50 ET (14:50 GMT)

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