Danone (DN) Q2 2024 earnings summary

Executive summary

• Achieved strong H1 2024 results with 4.0% like-for-like sales growth, broad-based performance across all geographies and categories, and net sales of €13,757m.

• Recurring operating margin improved by 45 bps to 12.69%, supporting reinvestment in growth and productivity gains.

• Free cash flow reached €1.2bn, up 11% year-over-year, reflecting disciplined capital and working capital management.

• Recurring EPS rose 2.6% to €1.80, with net income (Group share) up 11.5% to €1,219m.

• Strategic focus on high-protein, medical nutrition, coffee, and continued transformation in core categories.

Financial highlights

• H1 2024 net sales: €13,757m, up 4.0% like-for-like year-over-year.

• Recurring operating margin: 12.69% (+45 bps year-over-year).

• Free cash flow: €1.2bn (+11% year-over-year).

• Recurring EPS: €1.80 (+2.6% year-over-year); reported EPS up 11.6% to €1.89.

• Reported sales declined 2.9% due to negative scope and forex, partially offset by hyperinflation.

Outlook and guidance

• 2024 guidance confirmed: like-for-like sales growth expected between 3% and 5%, with moderate improvement in recurring operating margin.

• Pricing expected to remain positive in H2, with most negotiations completed and visibility for the remainder of the year.

• Mid-term (2025-2028) targets: like-for-like net sales growth of 3%-5%, recurring operating income to outpace sales, aiming for double-digit ROIC and €3bn free cash flow.