15 Oct 2009 14:25

Danone plans to maintain 2009 sales in Russia at 2008 level

MOSCOW. Oct 15 (Interfax) - French Danone plans to maintain sales in Russia in 2009 at last year's level, the general director of Danone in Russia and the CIS Tomas Royter told Interfax.

Danone sold 260,000 tonnes of product in Russia last year, generating 22 billion rubles in revenue.

The stagnation of sales this year will not force Danone to revise its investment program, he said. Danone will continue to invest in modernizing production capacity, to transition to contemporary quality standards and in environmental projects, he said.

A substantial portion of investment in 2010 will go to promoting company-owned distribution of dairy products. Danone currently works with local distributors, but wants to have independent distribution in the most important Russian cities.

The company completed the expansion of capacity at its plant in Chekhov outside Moscow. The main investment in the project concluded in 2009. It will be the second largest Danone plant worldwide. The upgrade will sustain growth in the company's business in Russia for several years to come, he said.

In order to maintain sales this year, Danone, which has traditionally focused on the premium market segment, plans to launch a budget line of products. Launch of the new line, which will bear the Danone brand, will include kefir, curds, sour cream and yoghurt, and will be positioned in a completely different price category, as a basic product accessible to people with any income level, he said.