By Dominique Vidalon
PARIS (Reuters) -Danone on Wednesday reported second-quarter sales that beat expectations, boosted by strong demand in China for infant milk formula and medical nutrition products.
This largely outpaced weakness in the water segment in Latin America due to rainy and cold weather in Mexico, and still sluggish coffee creamer sales in a competitive U.S. market.
The French consumer goods group, whose brands include Evian and Badoit water and Activia yoghurt, said second-quarter sales
rose 4.1% on a like-for-like basis, compared with expectations of 3.8% increase in a company-provided analysts' consensus.
Danone's recurring operating income for the first half of 2025 was 1.811 billion euros ($2.09 billion), with a margin of 13.2% of sales against 12.7% a year ago.
The company reiterated that its full-year 2025 forecast was in line with its mid-term ambition of like-for-like sales growth of between 3% and 5%, with recurring operating income growing faster than sales.
The first half performance reflected "the strength and resilience of our health-focused portfolio," said CEO Antoine de Saint-Affrique, adding that Danone was focused on "the consistent execution of our consumer-centric and science-based strategy and the delivery of our mid-term guidance."
Danone, which ended last year with record cash of 3 billion euros, has been using some of it for acquisitions to boost its focus on health and science, and build resilience to a volatile environment marked by U.S. tariff uncertainty and weak consumer sentiment.
The group recently bought The Akkermansia Company, a Belgian biotics company, as well as a majority stake in Kate Farms, a U.S. plant-based organic formula and shakes maker.
Danone, like rivals Unilever and Nestle, has slowed price hikes after three years of steep increases following the COVID-19 pandemic to win back shoppers who had turned to cheaper brands amid elevated inflation.
In the second quarter alone, volumes contributed 3.2% to revenue growth and prices 1%.
($1 = 0.8654 euros)
(Reporting by Dominique Vidalon, Editing by Charlotte Van Campenhout and Eileen Soreng)
