Danone S.A. said Friday its North American operations delivered flat third quarter sales growth, with declining sales under the Horizon organic dairy brand after the decision was made to eliminate the brand’s macaroni and cheese and snack categories.
Paris, France-based Danone (OTCQX:DANOY), the world’s largest yogurt maker, said its overall third quarter consolidated sales of €6.4 billion (US$7.1 billion), up 3.7 percent on a reporting basis.
Danone had acquired the Horizon organic dairy brand when it purchased the operations of The WhiteWave Foods Company in April 2017 for $12.5 billion.
Danone combined its North American dairy operations, largely the Dannon and Stonyfield brands, with the operations of WhiteWave, which also included the Earthbound Farm organic produce brand and the Silk and So Delicious plant-based brands. Both the Stonyfield and Earthbound Farm brands have been divested.
Summing up its third quarter results in North America, Danone said the region is facing a “challenging consumer environment.”
The company said its North American Premium Dairy segment, which solely consists of the Horizon organic dairy brand, turned in a “good performance of the core business,” meaning organic milk SKUs, in the third quarter.
But the overall decline in the brand’s sales for the quarter came after Danone “discontinued some non-core business within our premium dairy unit, such as the Sir Bananas brand, snacks, mac & cheese ranges, and a few dilutive formats,” a spokesperson told Sustainable Food News on Friday.
Among the product lines getting the boot from the brand was the Horizon Organic Good & Go! Snacks line which was launched only two years ago.
Up until Jan. 1, Danone had separately reported financial results for its North America subsidiary, which it referred to as Essential Dairy and Plant-based products North America (EDP NORAM), providing detail on the fiscal health of popular U.S. brands such as the Horizon organic dairy and Silk and So Delicious plant-based brands.
But under a new financial reporting structure, Danone now reports EDP NORAM and EDP International as a single entity, so financial results for overall North American operations are no longer available.
Danone North America had 2018 sales of €5 billion ($5.7 billion), up 1.5 percent from the previous year.