Food group Danone's Q2 sales beat forecasts, company launches buyback programme

Danone said it would launch a €800 million share buyback programme in the second half of the year

Danone stuck to its goal of returning to profitable growth in the second half of 2021 after posting a 6.6% rise in second quarter sales, beating analysts' expectations for a 5.1 per cent increase, as its waters and baby food units returned to growth.

Danone reiterated it expected its full year 2021 recurring operating margin to be broadly in line with the 14 per cent achieved last year and said it would launch a €800 million share buyback programme in the second half of the year.

Danone said first-half 2021 recurring operating income reached 1.551 billion euros ($1.84 billion), a like-for-like decline of 4.2 per cent, as higher input cost inflation weighed, and highlighting the scale of the challenges facing new chief executive Antoine de Saint-Affrique who is joining in September.

The consumer goods giant, owner of Evian and Badoit water and Activia yoghurt, said group operating margin slipped to 13.1 per cent of sales in the first-half 2021 from 14 per cent in first half 2020.

Danone added it would reduce the number of its directors on its board.