PARIS — Effective pricing and volume/mix gains carried Danone SA to an earnings increase of 11.5% in the first half of the fiscal year, which saw headwinds in foreign exchange and the effects of deconsolidating its Essential Dairy and Plant-based (EDP) business in Russia.

Net income of €1.22 billion ($1.32 billion), equal to €1.89 ($2.04) per share on the common stock, was up from €1.09 billion, or €1.70 per share, in the first half of the previous year. Net sales dropped 2.9% to €13.78 billion ($14.86 billion) from €14.17 billion, but like-for-like sales increased 4%.

“As we have said before, volume/mix is key for the resilience of a value creation model, and this semester, we have stepped up this contribution to plus 2.1%, showing progress for the fourth consecutive quarter,” said Antoine de Saint-Affrique, chief executive officer, in a July 31 earnings call. “Price contributed plus 1.9% to net sales growth in H1, normalizing as anticipated, with inflation slowing down.”

Juergen Esser, chief financial officer, added, “Outside of the like-for-like, ForEx (foreign exchange) had a negative effect of minus 2.4% as a result of a number of currencies depreciating against the euro, but this was partially offset by the impact of hyperinflation. And finally, scope effect had a negative contribution of minus 7.2% due to the deconsolidation of EDP Russia, Horizon Organic and the Michel & Augustin business. The deconsolidation effect of Russia is, with the closing of this first semester 2024, behind us, meaning we will report a significantly lower scope impact for the second half of the year.”

In Danone’s Essential Dairy and Plant-based Protein business, sales fell 9.6% to €6.79 billion ($7.33 billion) from €7.50 billion, but like-for-like sales increased 3.1%. In Specialized Nutrition, sales increased 3.9% to €4.41 billion from €4.25 billion, and like-for-like sales increased 4.3%. Market share gains in Specialized Nutrition came across the globe, including in China and Europe, Esser said. In Waters, sales rose 6% to €2.56 billion from €2.41 billion, and like-for-like sales increased 6% as well. Momentum continued for the Mizone brand in China, and growth in Waters came in Europe despite poor weather conditions, Esser said.

In Danone’s North America region, first-half sales declined 2.5% to €3.33 billion from €3.42 billion, but like-for-like sales increased 3.7%. Volume/mix, up 2.9%, and resilient pricing led the growth in North America, Esser said.

“The growth in North America was notably led by our yogurt business with another stellar performance of the high-protein range under the Oikos brand,” he said. “In parallel, our Coffee Creations business is posting again a strong growth in this (second) quarter with continued market share gains for both brands International Delight as well as Stōk. At the same moment, we can report a similar competitive momentum also for our Waters business with our Evian brand enjoying a strong momentum in this (second) quarter.”

De Saint-Affrique added, “In the US, we are making progress with turning around our plant-based beverage business. We took some pricing actions earlier in the year and are starting to see some green shoots of regaining competitiveness.”

Paris-based Danone maintained its outlook of like-for-like sales growth between 3% and 5% for the fiscal year.