Groupe DANONE: Preliminary 2001 half year results - Sales growth + 6.2 % (like for like basis), Rise in operating margin from 10.6% to 10.9%


PARIS, July 26, 2001 (PRIMEZONE) -- Groupe DANONE (NYSE:DA)

Financial highlights for preliminary and unaudited half year results are established as follows:


 (EUR millions)          2000 H1   % net sales   2001 H1  % net sales
                                       2000 H1               2001 H1
                                      
 SALES                    7,254         100%       7,292       100%
                                 
 Cost of goods sold      -3,504       -48.3%      -3,655     -50.1%
 Selling expenses        -2,297       -31.7%      -2,225     -30.5%
 Other                     -683        -9.4%        -617      -8.5%
                                 
 OPERATING RESULT           770        10.6%         795      10.9%
                                 
 Non recurring items(1)     -16        -0.2%         -15      -0.2%
 Financial cost             -85        -1.2%         -86      -1.2%
 Taxes                     -266        -3.6%        -256      -3.5%
 INCOME OF FULLY 
 CONSOLIDATED COMPANIES     403         5.6%         438       6.0%

 Minority interests         -66        -0.9%         -80      -1.1%
 Net earnings of equity 
 method companies            15         0.2%          17       0.2%
 Net income                 352         4.9%         375       5.1%

 (euros)                               Growth                  Growth

 - Fully diluted earnings 
 per share                 2.50        +17.9%       2.65      +6.0%
 - Fully diluted earnings 
 per share before goodwill 
 amortisation              2.95        +19.3%       3.20      +8.5%

 Cash flows from 
 operations                 790                      811 
 Capital expenditures      -274                     -298
 Investments in 
 subsidiaries and 
 equity method companies -1,846                     -796 
 Equity (incl. Minority 
 interests)               7,408                    8,182
 Net Financial Debt       4,562                    4,685
 Gearing ratio               62%                      57%

(1) : Non recurring items do not include any capital gain & loss as of 6/30/2000 and as of 6/30/2001.

1/ SALES GROWTH (LIKE FOR LIKE) : +6.2 %

When restated for comparable structure and exchange rates, 1st-Half 2001 sales were up 6.2% compared to the same period of 2000. This 6.2% sales growth is derived for 4.3% from volume and 1.9% from value.

Changes in the scope of consolidation trimmed sales by 7.7%, mainly due to the disposal of the European brewing activities, while currency translation (primarily the US dollar and linked-currencies) led to a 2% rise.

For the 1st half, sales by business line and by geographical area are as follows:


 BY BUSINESS LINE               2000 H1  2001 H1  Like for like
 (EUR millions)                                    Growth
                                
 Dairy products                  3,223    3,477    +6.9%
 Beverages                       2,334    2,005    +9.2%
 Biscuits                        1,517    1,631    +1.8%
 Other food businesses 187         188             +1.5%
 Intercompany sales                 -7       -9     --
 GROUP                           7,254    7,292    +6.2%

 BY GEOGRAPHICAL AREA          2000 H1  2001 H1  Like for like
 (EUR millions)                                  Growth

 France                          2,441   2,058   +3.4%
 Rest of Western Europe 2,582    2,524           +6.3%
 Rest of World                   2,650   3,187   +7.5%
 Inter-regional sales             -419    -477     --
 GROUP                           7,254   7,292   +6.2%

Sales growth (like for like) by business line and by geographical area are established as follows:


 BY BUSINESS LINE        1ST Q    2ND Q    1ST HALF
 
 Dairy products           +7.0%    +6.8%     +6.9%
 Beverages                +9.4%    +8.9%     +9.2%
 Biscuits                 +3.5%    +0.3%     +1.8%
 
 Other food businesses    +2.4%    +0.3%     +1.5%
 
 GROUP                    +6.6%    +5.7%     +6.2%
 
 BY GEOGRAPHICAL AREA    1ST Q    2ND Q   1ST HALF
 
 France                   +6.3%    +0.8%     +3.4%
 Rest of Western Europe   +6.6%    +6.1%     +6.3%
 Rest of World            +6.8%    +8.1%     +7.5%
 GROUP                    +6.6%    +5.7%     +6.2%

2/ OPERATING MARGIN FROM 10.6 % TO 10.9 %

Operating margin showed a significant improvement, from 10.6% in the 1st half 2000 to 10.9% in the 1st half 2001.

Operating income and operating margin by business line and by geographical area are established as follows:


 BY BUSINESS LINE       Operating income     Operating margin
 (EUR millions)         2000 H1 2001 H1      2000 H1    2001 H1
                                        
 Dairy products            351    385          10.9%     11.1%
 Beverages (1)            296     242          12.7%(1)  12.1 %(1)
 Biscuits                 112     135           7.4%     8.3%
 Other food businesses     21      28          11.2%    14.9%
                                        
 Unallocated items        -10       5 (2)       
 GROUP                    770     795          10.6%    10.9%

(1) : Operating margin for Beverages included Beer activities during the first half 2000, Exc. Beer, operating margin for Beverages was 12.5% for 1st half 2000 and 12.3% for the 1st half 2001. (2) : Of which euros 25 million of brand royalties from Scottish & Newcastle Group.


 BY GEOGRAPHICAL AREA   Operating income      Operating margin
 (EUR millions)        2000 H1   2001 H1      2000 H1  2001 H1
                                        
 France (1)             302        223        12.4%(1)  10.8 %(1)
 Rest of Western Europe 252        263         9.8%     10.4%
 Rest of World          226        304         8.5%      9.5%
                                        
 Unallocated items      -10        5 (2)        -         -
 GROUP                   770      795          10.6%    10.9%

(1) : Operating margin for France included Beer activities during the first half 2000, Exc. Beer, operating margin for France was 11.5% for 1st half 2000 and 10.8% for the 1st half 2001. (2) : Of which euros 25 million of brand royalties from Scottish & Newcastle Group.

3/ NET EARNINGS PER SHARE (FULLY DILUTED) ROSE +6% (+8.5% excl. goodwill)

Net income for the 1st half of the year stood at EUR 375 millions, up 6.5%.

Growth of net earnings per share (fully diluted) was 6.0%. Before goodwill amortisation, EPS growth reached 8.5%.

4/ FINANCING

Capital expenditures for the first half 2001 amounted to euros 298 million, which represents 4.1% of total net sales.

Investments in subsidiaries and equity method companies amounted to euros 796 million. This figure includes operations as Aqua in Indonesia, Galbani in Italy and Pureza Aga in Mexico.

The Group used its shares buyback authorization for euros 56 million.

Net financial debt reached euros 4,685 million at June 30th 2001, compared with euros 4,401 million at December 31st, 2000. The gearing ratio was 57% at the end of June 2001.

Final results for H1 2001 and 9 months sales will be released October, 10th



            

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