(Paris) Three years after the resounding ousting of its boss, Danone is trying on Thursday to convince investors that the agri-food company has transformed into a safe bet, strong from its positioning in the buoyant medical nutrition market.
“I hope you appreciate how different the Danone of today is from the Danone of two years ago,” said Chief Executive Antoine de Saint-Affrique, during a presentation to investors on the strategy of the French multinational, which produces the Activia, Fortimel and Evian brands from its Amsterdam site.
His predecessor Emmanuel Faber was ousted at the start of 2021 following a shareholder revolt demanding more results and better return on capital.
The group forecasts “for the period 2025-2028, growth in turnover on a comparable basis [at constant scope and exchange rates] of between “3 and” 5% and growth in current operating income [the indicator of profitability highlighted] faster than that of turnover”.
He was already targeting an increase in turnover of the same magnitude for the current year. The latter had increased by 7% in 2023 due to the increase in sales prices.
Danone seeks “better quality growth,” as its CEO puts it, which involves increasing volumes sold and selling products that generate more revenue.
“We consider these solid objectives as a mark of confidence,” note analysts at the investment bank Stifel in a note.
On the Paris Stock Exchange, around 1 p.m. (7 a.m. Eastern time), the stock fell 3.84% to 56.66 euros (83.34 Canadian dollars) in a CAC 40 up 0.89%. .
The stock remains well below the 80 euros (118 CAN dollars) reached in 2019.
When Mr. de Saint-Affrique arrived in September 2021, Danone was a “sick body”, a spokesperson for the group reported to AFP. “The last two or three years have demonstrated that we can transform the company, do business responsibly and efficiently while delivering returns to our shareholders,” adds this source.
The pioneering industrial yogurt group, whose foundation dates back to 1919, has cleaned up its portfolio – notably with the sale of Horizon Organic organic dairy products in the United States – and invested to expand its “health” activity, which is growing. addressed to medically monitored patients and no longer to consumers.
Danone recently bought an American company specializing in tube feeding, Functional Formularies.
He also announced in May to invest 60 million euros (88 million CAN) in a factory in the north of France to create a production line dedicated to nutritional supplements issued on prescription, particularly for people being treated for cancer.
The group intends to continue this momentum. “Medical nutrition is undoubtedly one of the strongest long-term growth opportunities for Danone” while the world population “is aging without being in better health,” observes Antoine de Saint-Affrique, citing a potential market of 20 billion. euros (29 billion CAN).
“We have the healthiest portfolio [in terms of nutrition] in the food and beverage sector,” praises the CEO.
For him, this is their “best asset” while the industry is criticized for selling products that are too fatty, too sweet, too salty.
Competitor Nestlé, the world’s number one food company and owner of KitKat chocolate bars, among other things, was heavily criticised in April by a group of investors who asked it to increase the share of healthy foods in its turnover.
Consumers “also need to treat themselves” with “indulgent” products, notes the Danone spokesperson. The group, which produces desserts for children and flavored creams to enhance its coffee, is according to this source “almost the only one to master the procedures to reduce sugar levels without altering the taste and experience”.
