French food group Danone has announced that it has picked outgoing Barry Callebaut boss Antoine de Saint-Affrique as its new chief executive to lead a turnaround.
Saint-Affrique had announced on 22 April he was stepping down as CEO of Swiss chocolate maker Barry Callebaut at the end of August, fuelling speculation he could be headed for the top job at Danone..
The appointment at Danone will be effective 15 September.
Danone had been looking to replace Emmanuel Faber, who was ousted in March following calls from activist shareholders to replace him after the group's sales growth and share price performance became sluggish compared with those of rivals.
'The Right Blend'
Chairman Gilles Schnepp said in a statement released after a meeting of the board that Saint-Affrique brought "the right blend of strategic vision, international consumer goods experience, and operational execution skills to Danone."
Several people close to the matter had previously told Reuters that Saint-Affrique was one of the people in the running for CEO, and one had said he was the front-runner for the job.
Saint-Affrique, 56, joins Danone after spending nearly six years at the helm of Barry Callebaut and about 15 years in senior positions at Unilever, where he notably led the foods division.
Since he took the reins in October 2015, Barry Callebaut's share price has more than doubled. Group sales rose by 17% and profit by more than two-thirds before the pandemic hit in 2020.
"His focus on so called smart growth – profitable, cash-generative growth with improving returns and focus on sustainability – probably did a lot to change the perception of Barry Callebaut from a volume-driven commodity supplier to a specialty ingredients company. I would expect him to bring the same discipline to his next role," KeplerCheuvreux analyst Jon Cox said.
"Antoine [de Saint-Affrique]’s proven ability to successfully deliver a purpose-led growth strategy in a sustainable way fits well with our mission and long-term goals," Schnepp said.
Challenges
Saint-Affrique's main challenge at the helm of the world's largest yoghurt maker will be to boost lagging profit margins and sales.
Activist investors have called for more investment behind innovation and for Danone to sell its less profitable brands.
Schnepp said that Saint-Affrique "will have all the room and resources a CEO can have to best assess and direct Danone's strategy for the future."
But the new boss may have limited room to chart a new path as Danone's board has already committed to back some of the changes set in motion by Faber.
These changes notably entail reorganising Danone around regional hubs rather than brands, alongside a broader drive to cut costs and axe 2,000 jobs.
Danone shares have gained 7% so far this year, outperforming their European sector and supported by speculation around activist intervention. This followed a 27% fall last year.
