Danone: Strong FY 2024 results; Entering the next chapter of Renew with confidence

Core Insights - The company reported strong FY 2024 results, achieving a like-for-like sales growth of +4.3% despite a reported sales decrease of -0.9% due to scope and forex impacts [2][8][24] - The recurring operating margin improved to 13.0%, up +39 basis points from the previous year, driven by operational improvements and reinvestments [2][16][21] - Net income attributable to the Group increased significantly by +129.4% to €2,021 million, with reported EPS rising by +130.2% to €3.13 [2][19][21] Financial Performance - FY 2024 sales were €27,376 million, down from €27,619 million in FY 2023, with a like-for-like growth of +4.3% driven by a +3.0% increase in volume/mix and +1.3% in price [2][8][55] - Recurring operating income rose to €3,558 million, reflecting a +2.2% increase from €3,481 million in FY 2023 [2][19] - Free cash flow reached a record level of €3,003 million, up +14.0% from €2,633 million in the previous year [2][22] Segment Performance - North America saw a like-for-like sales growth of +7.7%, driven by strong performance in High Protein, Coffee Creations, and Waters [10] - Sales in China, North Asia & Oceania increased by +6.8% on a like-for-like basis, with strong volume/mix growth of +9.8% [11] - Latin America reported a +4.7% increase in like-for-like sales, with notable growth in Specialized Nutrition and Waters [12] Strategic Focus - The company emphasized a renewed focus on health-driven products and science-based innovation to capture long-term market opportunities [5][6] - A commitment to value creation and disciplined capital allocation has led to a significant improvement in return on invested capital (ROIC), now back in double-digit territory [4][5] - The company plans to buy back 2.7 million shares in 2025 to offset dilution from employee capital increases and long-term incentive plans [25] Future Guidance - For 2025, the company expects like-for-like sales growth between +3% and +5%, with recurring operating income anticipated to grow faster than sales [24]