Danone foresees cuts of € 1 bi in costs until 2020

Danone provides a deceleration in the growth of its profits for this year and started a program aimed at cutting, until 2020, € 1 billion in costs, at a time when the world''s largest yoghurt maker prepares for a substantial increase in milk prices.
The French dairy group has targeted a growth in excess of 5% in recurrent profit per share this year compared to 2016, when this profit grew 9.3%. The forecast for this year excludes the pending acquisition of White Wave, American food manufacturer, as part of the effort of Danone to include natural and organic foods to your portfolio, because consumers are demanding healthier products and niche brands.

In announcing its results for 2016, Danone, based in Paris, said yesterday (15/2) that economic conditions in General remain particularly volatile and uncertain, with persistently weak consumer trends or even declining in Europe.
Cécile Cabanis, Chief Financial Officer, said the cuts will be obtained "spending better, buying better and reinvesting those savings in growth initiatives to achieve our ambition of profitable growth in 2020".
Sales in comparable bases [deleted effects of acquisitions or expansion] in the year until December 31, grew 2.9%, to € 21.9 billion-the slower pace in 20 years. Reported sales, adjusted for exchange rate changes and other factors, were 2.1% lower, affected by foreign exchange losses imposed by Argentine and Mexican pesos, and the Russian rouble.
In Europe, Danone''s home market, sales in comparable bases fell 1.4%, to € 8.5 billion, reflecting the toughest market conditions in Spain and relaunching the shambler Activia, your digestive health mark which "has not met" the expected recovery.
Danone is trying to better position the Activia to compete with cheaper rivals, redesigning the logo and the packaging and selling it as a premium product. The company also had to adapt to regulatory changes in Europe, after controlling agencies conclude it is not possible to prove that products probiotics, such as Activia, promote digestive health or increase immunity.