DAVY VIEW

We buy into the ‘New Danone’ ethos of greater discipline, relevance and adaptivity – as evidenced by margin and revenue progression. However, Danone has a habit of reminding investors of the past rather than future possibilities. It now faces near-term growth headwinds. In 2020, top-line growth will be hard earned – the attainment of consensus organic growth (3.5%) would be a good result. We are more confident on margin delivery, with good execution to date. We maintain our ‘Outperform’ call but recognise that revenue progression may not be linear.