French packaged food producer Danone posted net income attributable to the group of €2.45 billion in 2017, up 42.6% on a reported basis from €1.72 billion in 2016, as sales and operating margins rose.
Earnings per share by the producer of Evian water and Activia yogurts jumped 40.1% to €3.91 from €2.79 in the previous year. Sales were up by 12.5% to €24.68 billion in 2017 from €21.94 billion in 2016, and operating margin rose 70 basis points to 14.36%, despite the rising cost of supplies. The U.S. tax reform gave a one-off non-cash benefit of €285 million.
Recurring earnings, which exclude significant items that are exceptional in nature, were €2.19 billion during the year, up from €1.91 billion in 2016. Recurring EPS grew by 14.2% at a constant exchange rate to €3.49 in 2017 from €3.10 in the prior year.
The company will propose a dividend of €1.90 per share in 2017, 11.8% higher year on year.
For 2018, Danone is targeting a double-digit recurring EPS growth on a constant-currency basis, excluding the impact of its planned sale of a roughly 14% stake in Yakult Honsha Co. Ltd.
While Danone provided no profit breakdown for the final quarter of 2017, it said that sales grew by 3.7% on a like-for-like New Danone basis in the period, driven by growth in specialized nutrition and waters.