PARIS – Revenue at French dairy company Danone was flat in the third quarter after an infant formula recall over fears of botulism contamination.
The yogurt and baby food maker said Wednesday that revenue was 5.3 billion euros ($7.2 billion) in the July-to-September quarter. That’s less than the average of 5.4 billion euros expected by analysts surveyed by FactSet.
The company has been driving hard into Asia with its waters and baby nutrition. But those efforts were set back this summer when New Zealand dairy company Fonterra, which is a Danone supplier, triggered an infant formula recall over fears of contamination by botulism bacteria. Testing later showed it was likely a false alarm.
The recall drove sales for Danone’s baby nutrition down 13 per cent in the third quarter. Sales in other divisions were either stable or increased.
The company said the recall would likely shave 350 million euros off its annual revenue and adjusted down its growth targets for the year. In an analyst call to explain the figures, Pierre-Andre Terisse, the chief financial officer, said the company is seeking damages for its losses. He did not say from whom or how much.
Shares in Danone were down 3.3 per cent in morning trading in Paris.