14 Jun 2016 --- Danone is expecting to improve its profitability for the year, citing strong growth in China and emerging markets as reasons to raise its financial expectations.

In an unexpected announcement, the French giant said that it is now targeting operating margin improvements of between 50-60 basis points, compared to the "solid improvement" it previously targeted.

Its sales targets, as previously stated, are expected to be between three and five percent.

Cécile Cabanis, Danone CFO said: "In 2016, we continue to implement our agenda to transform the company and increase the resilience of our business model through disciplined resources allocation, efficiencies and cost optimisation."

"With fast evolving dynamics in some emerging markets and notably China, we are adjusting the pace of top line refuelling for 2016 in these specific geographies."

Danone, whose brands include Activia and Evian, is adapting to changes in regulations in the Chinese market regarding the sale of baby formula.

The Chinese government is re-adjusting its pricing structure, as certain goods sold on websites and imported into China had been given a price advantage.

Analysts welcomed the news from Danone, whose first half results are expected on July 28.

Source: Food Ingredients First