Danone sales increased 6.9 percent in the fourth quarter and in full year 2010.
Volume grew 4.8 percent in fourth quarter and of 7.6 percent in full year 2010.
The company released the following chairman's statement:
"Our sales grew by over 6 percent in 2010, rising from quarter to quarter, with volume and value both making positive contributions in the second half. All of our divisions and all our regions posted gains. Continued high operating margin and a 20 percent rise in free cash flow are remarkable achievements in a year that saw a steep rise in raw material prices and the end of adjustments to sales prices under our reset program, which improved our competitive edge. These robust performances in 2010 testify to the strength of our business model.
"Reflecting the growth strategy Danone has pursued for many years, our structure is changing rapidly and emerging economies now represent half of our business. The joint venture uniting Danone and Unimilk since December,1,2010 makes Russia our largest single national market, with France. The move has created a new leader in Fresh Dairy products, with a nation-wide presence and strong brands in each segment. This investment offers exciting growth perspectives with major potential for value creation.
"The strength of our group, businesses, brands and teams, and our exposure to regions with robust growth prospects mean that we can look to 2011 with confidence. We anticipate no major change in consumer demand and in this context, also marked by persistently steep increases in raw material prices, we are placing the emphasis on lasting development of our brands, with a commitment to health, eating pleasure and respect for the environment. We will also be continuing efforts to raise global productivity to underpin our policy of competitive price management.
"We will aim to outperform our competitors in organic sales growth, margin, and cash generation."
Consolidated sales rose 13.5 percent to €17,010 million in 2010. Excluding the impact of changes in exchange rates (6.0 percent) and in scope of consolidation (0.6 percent), total sales were up 6.9 percent. This organic growth reflects a 7.6 percent rise in sales volume and a -0.7 percent decrease due to price mix. Exchange-rate effects were due primarily to rises in the Brazilian real, the Mexican peso, the U.S. dollar and the Russian ruble. Main changes in the scope of consolidation were the integration of Unimilk (Russia) from December 1, 2010, and, to a lesser extent, the arrival of two new European fruit-drink subsidiaries (Danone-Chiquita and Proviva), partially offset by the sale of Frucor (New Zealand) in February 2009.
In the fourth quarter, consolidated sales rose 16.8 percent to €4,299 million in the fourth quarter of 2010. Excluding exchange-rate effects (6.7 percent) and changes in the scope of consolidation (3.2 percent), the increase was 6.9 percent. This like-for-like rise reflects a 4.8 percent rise in sales volume and a 2.1 percent increase in sales value.
Sales of the fresh dairy division increased by 6.2 percent on a like-for-like basis in the fourth quarter of 2010, reflecting volume growth of 3.3 percent and a 2.9 percent rise in value.
This takes into account a steep 27.1 percent like-for-like rise at Unimilk in December, reflecting volume growth of 8.9 percent and a significant rise in average price per kilo due to higher sales prices and improvement in value within the product mix.
Excluding the impact of Unimilk, fresh dairy sales continued the trend observed in the previous quarter, rising 5.4 percent like for like in the fourth quarter of 2010 with a combination of 2.8 percent volume growth and a positive price effect of 2.6 percent.
This performance illustrates continued momentum from the reset program, despite a significantly higher basis for comparison in volume terms for the quarter and a persistently difficult consumer market in southern Europe.