Danone S.a Stock Earnings Reports

Danone reported a strong FY‑2025 with disciplined execution across its Renew Chapter 2 strategy: like‑for‑like sales +4.5% (vol/mix +2.7%), recurring operating margin +44 bps to 13.4%, recurring EPS €3.80 (+4.6%), free cash flow €2.8bn and ROIC moved into double digits (10.7%). Key growth platforms—high‑protein, gut/fiber, infant milk formula (IMF) and medical nutrition—performed well (notably CNAO: +11.7% LFL driven by volumes; Europe steady; North America underperformed and is a priority to fix). Management highlighted operational improvements (Gartner Top 25 supply chains, Industry 5.0, digitalization), strategic M&A (Kate Farms integration creating a ~$500m U.S. medical nutrition platform; consolidation of Australian JV to 51%), and continued investment behind product superiority. Headwinds and risks: IMF product recalls in Europe and the Middle East (management estimates a one‑off Q1 sales impact of ~0.5–1.0% of net sales / ~50–100 bps at group level in Q1), currency translation (FY‑2025 FX drag c. -4.4% on sales), and pockets of underperformance in the U.S. where leadership changes and capacity investments are underway. CapEx will modestly increase to support capacity for high‑protein and medical nutrition; dividend proposed €2.25 (≈+5%). Guidance for FY‑2026: like‑for‑like net sales growth +3% to +5% with recurring operating income growing faster than sales.