Danone (DN) investor relations material

Executive summary

• Delivered strong H1 2026 results with like-for-like sales growth of 3.5% and Q2 growth of 4.2%, broad-based across categories and geographies, supported by a health-focused portfolio.

• Operational excellence and disciplined execution led to recurring operating margin improvement to 13.3% (+12bps year-over-year).

• Recurring EPS rose to €1.92 (+0.9% year-over-year), and free cash flow reached €0.9bn.

• Continued investment in brands, innovation, and capabilities, with a focus on health-focused categories and science-based innovation.

• Confirmed 2026 guidance: 3% to 5% like-for-like sales growth and recurring operating income to grow faster than sales.

Financial highlights

• Q2 2026 reported sales grew 4.4% to €7,215m, with like-for-like growth of 4.2%.

• H1 2026 sales totaled €13,936m, up 3.5% like-for-like year-over-year.

• Recurring operating income rose to €1,854m, with recurring net income group share at €1,246m.

• Free cash flow declined to €852m in H1 2026 from €1,172m in H1 2025, mainly due to higher working capital needs.

• Net debt increased from €8.4bn at year-end 2025 to €9.0bn at June 2026.

Outlook and guidance

• 2026 guidance reaffirmed: 3% to 5% like-for-like sales growth, recurring operating income to outpace sales growth.

• Expect progressive normalization in IMF market and continued margin improvement in H2 as pricing actions take effect.

• Ongoing innovation roadmap and capacity expansion to support future growth, especially in North America.

• Management expresses confidence in delivering on mid-term ambitions despite ongoing market instability.