Danone shares fall sharply as sales drop below target

Shares in Danone fell 3% as the €39bn French food giant lowered its sales growth forecast following a weaker-than-expected fourth-quarter performance at its European dairy business.

Danone, the world’s largest yogurt maker, blamed worsening market conditions in Spain and problems with a new strategy for dairy brand Activia in some parts of Europe for the shortfall.

“This is a very ambitious transformation for the brand. We have overestimated the speed at which the turnaround would occur. We have to acknowledge we are not yet at the level we thought we would be at this time,” Danone chief financial officer Cecile Cabanis told analysts.