“Power Brands” Nourish Mondelez Q1 Results

bb40a175-ef60-451f-b7f6-aaf68f493271articleimage.jpg

03 May 2017 --- Exceeding financial analysts expectations, Mondelez International reports its Q1 results which show a solid start to the year bolstered by strong sales of its so-called “power brands” like Oreo, Cadbury Dairy Milk, Ritz and Chips Ahoy! as well as Milka and Lacta chocolate. 

Net sales from these rose 1.6% in the quarter, while the confectionery giant says its first quarter revenue came in at US$6.4 billion which was above previous estimates, but represents a 0.6% decrease on net revenue in the same period a year before. 

Q1 net earning were US$630 million, up 13.7% and resulting in 41 cents of earnings per share. 

"We had a solid start to the year despite challenging market conditions," says Irene Rosenfeld, Chairman and CEO. "We delivered both top-line organic growth and strong margin expansion in the quarter, while also making critical investments for our future. We remain confident in and committed to our balanced strategy for both top- and bottom-line growth, continuing to focus on what we can control to deliver long-term value creation for our shareholders."

Organic net revenue increased 0.6%, with growth in all regions except North America.

Gross profit margin was 39.4%, an increase of 10 basis points driven primarily by lower Restructuring Program implementation costs. Adjusted Gross Profit margin was 40.3%, a decrease of 20 basis points, driven by unfavorable mix impacts and higher input costs, partially offset by strong net productivity and improved pricing.

Operating income margin was 13.1%, up 190 basis points, reflecting the Adjusted Operating Income gains and the benefit from the settlement of a Cadbury tax matter. Adjusted Operating Income margin increased 90 basis points to 16.8% due primarily to continued reductions in overhead costs and supply chain productivity savings.

The company says it continues to expect Organic Net Revenue to increase at least 1% in 2017 and Adjusted Operating Income margin in the mid-16 percent range. The company also expects double-digit Adjusted EPS growth on a constant-currency basis and estimates currency translation would reduce net revenue growth by approximately 1% and Adjusted EPS by approximately $0.02. In addition, the company expects Free Cash Flow of approximately US$2 billion.

Related Articles

Food Ingredients News

Innovation success for alternative proteins at FiE

13 Dec 2017 --- Alternative proteins had a strong presence at FiE in Frankfurt last month. Exhibitors showed a sustained focus on alternative protein concepts, with a number of innovations and concepts creating a real buzz at this year’s show. FoodIngredientsFirst looks at a few of the offerings being exhibited at this year’s event.

Regulatory News

Plain packaging could lead to billions in food industry losses, says new study

12 Dec 2017 --- Following the introduction of plain packaging for tobacco products in some countries and calls to extend the legislation to other sectors, marketing consultancy Brand Finance has analyzed the potential financial impact of such a policy on food and beverage brands.

Food Ingredients News

Palsgaard CCO: Emulsifiers can thrive on a sustainability platform

12 Dec 2017 --- Emulsifier and stabilizer manufacturer Palsgaard A/S is the enabler of a new industry initiative aimed at inspiring and sharing expert knowledge, know-how and ideas to help realize the full potential of sustainably sourced and produced emulsifiers. Emulsifiers contribute to a very small part of the ingredients list for a range of foods – from baked goods to ice cream, chocolate, dairy and margarine – but they play a huge role in ensuring product quality and shelf-life, enabling them to support a number of the UN’s Sustainable Development Goals (SDGs). 

Business News

Solo Gelato and Barry Callebaut join forces to disrupt ice cream market with capsule innovation

11 Dec 2017 --- Israeli-based startup Solo Gelato has been developing a Nespresso-style capsule system that makes fresh ice cream in an instant – and Barry Callebaut has been helping to bring this goal to fruition.

Food Ingredients News

Sugar reduced solutions in abundance at FiE 2017

11 Dec 2017 --- Sugar reduction was the focus for many exhibitors at this year's Food ingredients Europe 2017 (FiE), even in indulgent applications, such as chocolate and desserts. With 2018 set to be a big year for sugar reduction and with sugar taxes coming into effect in Ireland and the UK, many ingredients suppliers are looking to innovate even further in the space of sugar reduction.

More Articles