French dairy-to-biscuits group Danone reported like-for-like sales grew 7.8 per cent during the year, although negative exchange rates and the impact of disposals (notably that of Italian dairy group Galbani in April 2002) meant that reported sales were down 9.1 per cent for the first quarter to €3.27 billion.
Dairy products remain the most important business line for Danone, posting sales of €1.53 billion for the quarter, up 9.4 per cent on a like-for-like basis. The water unit is the second most important, part of the beverages unit, which showed an 11.4 per cent increase in organic sales during the first three months of the year, with total revenues from the business reaching €882 million.
The biscuits and cereal products business was in third place with sales of €738 million, up just 1.5 per cent on a constant basis. The group's other food business (mainly condiments such as HP Sauce and Lea & Perrins) saw its sales reach €80 million, up 0.8 per cent.
"The first quarter performance, achieved in a less positive international environment, reflects the strength of the group's profitable growth model and allows Danone to confirm its 2003 targets: an organic sales growth between +5 and +7 per cent and an increase of the operating margin," the company said in a statement.
Danone also announced this week that it is to merge with Switzerland's Eden Springs to form one of the biggest European players in the HOD bottled water market.