Mondelēz International Expects Modest Organic Revenue Growth and Solid Margin Expansion in 2015

 Breaking News
  • Nestlé to Sell Skin Health Business For €9 Billion Nestlé has entered into exclusive negotiations with a consortium led by EQT and a wholly owned subsidiary of the Abu Dhabi Investment Authority (ADIA) for the sale of Nestlé Skin Health for a value of SFr10.2 billion (€9.0 billion). Nestlé Skin Health had net sales of SFr2.8 billion in 2018. The proposed transaction will be [...]...
  • Bakkavor Group Expands in UK Desserts Category Bakkavor Group, the leading provider of fresh prepared food in the UK, is acquiring Blueberry Foods, a desserts business owned by Samworth Brothers for an undisclosed price. Blueberry operates from a custom-built facility in Leicestershire with approximately 420 employees and produces a range of desserts for the UK’s leading grocery retailers. A capital investment of more [...]...
  • Waitrose Plans to Treble the Size of Online Operations Waitrose & Partners has announces plans to treble the size of its successful online grocery operation to a £1 billion business over the next three years, working in partnership with Today Development Partners (TDP) . The move with TDP, which is headed by Jonathan Faiman and Mo Gawdat, will accelerate the development of Waitrose.com through [...]...
  • Müller Revolutionises the UK’s Favourite Yogurt Brands Müller is set to revolutionise the UK yogurt category with new and improved recipes for the nation’s two favourite yogurt brands, Müllerlight and Müller Corner[1]. The dairy company has also revealed details of its biggest ever marketing campaign. As the business continues to strengthen its core brands, and inspire people to live healthier and happier lifestyles, [...]...
  • Guardians of Grub Crusade to Beat Food Waste A bold new industry campaign has been launched to tackle nearly £3 billion worth of food that is wasted every year across the entire UK hospitality and food service sector, of which 75% could have been eaten. The Guardians of Grub campaign was developed by WRAP as part of its ambitious work to cut food [...]...

Mondelēz International Expects Modest Organic Revenue Growth and Solid Margin Expansion in 2015

Mondelēz International Expects Modest Organic Revenue Growth and Solid Margin Expansion in 2015
February 13
09:33 2015

Global snacking giant Mondelēz International has reported a 3% fall in net revenues to $34.2 billion for 2014, including a negative 5.1 percentage point impact from currency. Operating income declined by 18.4% to $3.2 billion, including a negative 12.4 percentage point impact from restructuring costs.

However, organic net revenue increased 2.4%, driven by strong pricing performance (up 4.5 percentage points), which more than offset unfavorable volume/mix (down 2.1 percentage points). The decline in volume/mix was largely due to price elasticity, a slow response by competitors to higher input costs and the impact of significant price-related customer disruptions that are largely resolved. Organic net revenue from emerging markets was up 7.0%, while developed markets decreased 0.5%. Overall, Power Brands grew 4.1%.

Adjusted operating income grew 10.2% on a constant-currency basis. Adjusted operating income margin expanded 0.8 percentage points to 12.9%, driven primarily by strong gains in Europe and North America. Mondelēz International continued to reduce overheads in all regions.

In addition, the company maintained working media support while lowering overall advertising and consumer expense by driving efficiencies through consolidating providers, reducing non-working costs and shifting spending to lower-cost, digital outlets.

5751_cadbury-dairy-milk-wrapper-redesign-launches_content_New_Diary_Milk_WrapperAdjusted EPS grew 23.4% on a constant-currency basis, driven by operating gains, lower interest expense and share repurchases.

“In 2014, we delivered strong earnings growth, margin expansion and cash flow in a challenging consumer and retail environment by driving record net productivity and aggressively reducing overheads,” says Irene Rosenfeld, chairman and chief executive of Mondelēz International. “At the same time, we delivered organic net revenue growth in line with our expectations as we raised prices to recover higher input costs, protect profitability and ensure the health of our franchises.”

In 2015, the company expects organic net revenue growth of at least 2%, after accounting for the company’s strategic decision to exit certain lower-margin revenue. Adjusted operating income margin is expected to be approximately 14% for the year, with margin expansion accelerating in the second half, driven by the timing of cost-reduction programs. Adjusted EPS is expected to increase at a double-digit rate on a constant-currency basis.

With approximately 80 percent of revenues in currencies not tied to the strengthening US dollar, Mondelēz International estimates foreign exchange translation to reduce 2015 net revenue growth by approximately 11 percentage points.

She continues: “As we execute our transformation agenda in 2015, we expect to deliver modest organic revenue growth as well as solid margin expansion and strong constant-currency earnings growth. We remain on a clear path to achieve our 2016 margin target and to drive sustainable earnings and revenue growth over the long term. We’re continuing to execute our cost-reduction initiatives to expand margins and to make the necessary foundational investments in our brands, innovation platforms, routes to market and supply chain, so we’re well-positioned to accelerate revenue growth as consumer demand improves.”

About Author



Related Articles

Food & Drink Business Conference & Exhibition 2016

Upcoming Events

  • June 18, 2019Multimodal 2019
  • June 25, 2019BevExpo 2019
AEC v1.0.4

find food jobs

The Magazine

F&D Business Preferred Suppliers

New Subscriber

Subscribe Here