Danone's souring Spanish sales point to wider malaise
Wednesday 20 June 2012
The French food giant Danone has warned that it is being hit by the financial crisis in Southern Europe, an admission that suggests rivals such as Unilever and Procter & Gamble must also be suffering.
The world's largest yoghurt maker, with brands including Actimel and Activia, said Spanish consumers in particular were cutting back, forcing it to issue what is in effect a profits warning.
Danone is also being buffetted by higher costs for raw materials such as milk and packaging.
It says profit margins will fall by 50 basis points in 2012. Danone had previously expected "stable" margins.
The chief financial officer, Pierre Andr Terisse, said Danone planned to respond to declining consumption in southern Europe with price cuts, but that it was too early to provide details. He said demand in Asia, the Americas, Russia and the Middle East remained robust.
Jon Cox, an analyst at Kepler Capital Markets in Zurich, told Bloomberg: "While I am not surprised about the
deterioration in southern Europe and assume Spain, Italy and Greece combined are around 10 per cent of its sales, I am surprised that it talks about higher commodity costs."
- 1 Amy Winehouse statue unveiled in Camden
- 2 Lego breaks out of the toy box and heads for the gallery
- 5 A bottle of wine a day is not bad for you and abstaining is worse than drinking, scientist claims
George Galloway on Scottish independence: The political class is doing what Hitler couldn’t – destroying Britain
Daniele Watts: Django Unchained actress detained in Los Angeles after being mistaken for a prostitute
Scottish independence: Nationalist leader Jim Sillars threatens pro-union companies with 'day of reckoning' after independence
Scottish independence: Yes campaign feels the heat as Alex Salmond's NHS claims come under furious attack
Scottish independence: Britain faces 'constitutional crisis' at next election
£23m Birmingham cycle scheme is attacked by Tory councillor for not catering to the elderly
iJobs Money & Business
£280 - £320 per day: Ashdown Group: The Ashdown Group have been engaged by a l...
£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...
£35000 - £38000 per annum + Benefits: Ashdown Group: Training Coordinator / Pl...
Data Governance Manager (Solvency II) – Contract – Up to £450 daily rate, 6 month (may go Permanent)
£400 - £450 Per Day: Clearwater People Solutions Ltd: We are currently looking...