Financials round-up: Spotlight on Danone, Unilever, Otsuka, Kirin, a2 milk

Danone CEO: China’s business ‘extremely strong’ with infant, medical nutrition sales growing​​

Danone’s CEO said that its business in China had been “extremely strong” in FY23, with growth propelled by its specialised nutrition portfolio, including infant and medical nutrition products.

Danone’s full year sales for FY23 was €27.6bn (US$29.9bn), up seven per cent on a like-for-like basis. Recurring operating profit was €3.5bn (US$3.79bn), with a margin of 12.6 per cent, up 40 basis points (bps) from the year before.

CEO Antoine de Saint-Affrique has described China’s business for the past year as “extremely strong”, ​citing a stronger infant formula portfolio and a strong tube-feeding nutrition business.

Beating the market: a2 milk reports 1.5% growth in China’s shrinking infant formula sector​​

The a2 milk Company said that its infant formula sales in China had increased by 1.5 per cent in the first half of FY2024, although the overall market had shrunk almost 14 per cent in sales.

Total revenue was up 3.7 per cent to NZD$812.1 million (US$499.4m). Net profit after tax attributable to owners of the company also increased 15.6 per cent to $85.3 million (US$52.5m).

China, being its largest market, saw sales of infant formula increased by 1.5 per cent, despite total market sales declining by 13.6 per cent and volume down by 10.7 per cent.

Electrolyte drinks boost: Otsuka Holdings says China’s demand drives Pocari Sweat to new heights​​

Electrolyte drink Pocari Sweat has been seeing strong demand, especially in China in the post-pandemic era, having surpassed the growth rate of sports drinks in the APAC market by more than five times.

The brand, owned by Otsuka Holdings, was cited as a key factor driving the company’s growth in its nutraceutical business.

Otsuka Holdings reported a 16.1 per cent increase in total revenue to JPY$2.018 tr (US$13.5bn) in FY23, with total business profit up 78.7 per cent to JPY$312.6bn yen (US$2.09bn).

Kirin FY23 results: Health functional drinks revenue up 30%, driven by immune and small bottle offerings​​

Kirin has reported strong revenue growth for its non-alcoholic beverage business, driven by demand for health functional drinks and especially those in small-volume PET bottles.

Total revenue for the company was up 7.3 per cent to JPY$2,134.4 bn (US$14.2bn), while profit before tax climbed three per cent to JPY$197 bn (US$1.31bn).

A key revenue driver was the Kirin Oishii Immune Care​ series, which saw sales volume of its small-volume PET bottled products, which comes in 100ml each, went up by 3.4 times year-on-year.

Premium push: Unilever India believes food sector growth lies in higher-priced value-added products​

Hindustan Unilever India (HUL) has highlighted a continued focus on its premium strategy in order to sustain continued growth in the country, citing products such as Horlicks Plus as a major example.

In its Q3FY2023 results, the company reported near-flat percentage growth of 0.1 per cent to INR154.6bn (US$1.86bn) and a minus two per cent drop in Profits After Tax to INR34.6bn (US$416.4mn).

Against the backdrop, the company believes that its Health Food Drinks category, including Horlicks Plus,  is a “structurally attractive category” ​with long-term growth potential.