PARIS, Feb 22 (Reuters) - French food group Danone said on Thursday it was starting this year with confidence after it delivered 2023 sales growth at the top end of its forecast, and improved its profit margin as higher prices offset lower volumes.

"Building on the positive momentum of 2023, we are starting this financial year with confidence in our Renew strategy," CEO Antoine de Saint-Affrique said in a statement.

Amid encouraging signs at the world's largest yoghurt maker, Saint-Affrique cited the "visible progress" of the Essential Dairy and Plant-based (EDP) business in Europe and group sales volumes that turned positive in the fourth quarter as pricing eased.

For 2024, Danone said its forecast was in line with its mid-term ambition of like-for-like sales growth of 3%-5%, with a moderate improvement in recurring operating margin.

The consumer goods giant, owning brands including Evian and Badoit water and Activia yoghurt, reported 2023 sales of 27.619 billion euros ($29.84 billion), a like-for-like rise of 7%, at the top end of its 6%-7% sales growth guidance and in line with analysts expectations.

The operating margin for full year 2023 rose to 12.6% of sales from 12.2% in 2022, compared with average analysts' estimates of 12.5%.

For the fourth quarter ended Dec. 31, sales grew 5.1%, slightly above market estimates of 5%, with contribution from all its three businesses - EDP, Specialised Nutrition and Waters.

Danone, like its rivals Nestle and Unilever , has increased prices to cope with higher commodities and supply chain costs.

But this has raised concerns that companies were pushing prices too far, amid a cost of living crisis that is seeing retailers' private label brands stealing market share.

With record cash flow of 2.6 billion euros in 2023, Danone said it would give a 5% dividend hike to 2.10 euros.

($1 = 0.9255 euros) (Reporting by Dominique Vidalon; Editing by Sudip Kar-Gupta and Rashmi Aich)