Mondelēz Beats Core Revenue Estimates On Emerging Markets Demand
Oreo cookies maker Mondelēz International Inc reported a higher-than-expected growth in first-quarter core revenue, boosted by demand for its snacks and chocolates in emerging markets and higher pricing in Latin America.
Fast-growing countries such as China and India have been a focus area for Mondelēz over the last few years, with the company tailoring products and marketing to the local regions.
Core, or organic, net revenue, which excludes the impact from acquisitions and currency fluctuations, rose 3.7%, beating analysts' average estimate of a 2.3% increase, according to IBES data from Refinitiv.
Core revenue in emerging markets rose 8.4%.
A 'Strong Start'
"Our strong start to the year demonstrates clear progress against our plans to accelerate volume-led growth by adopting a more consumer-centric and agile mindset,” said Dirk Van de Put, chairman and CEO.
Pricing in Latin America rose 9.9 percentage points as Mondelēz, like other food companies, had to hike prices of cookies, gums, and chocolates in the face of rising raw material and transportation costs.
Net earnings attributable to the company, which also makes Cadbury chocolates, fell to $914 million, or 63 cents per share, in the three months ended 31 March, from $1.05 billion, or 70 cents per share, a year earlier.
Excluding one-time items, the company earned 65 cents per share, beating analysts' average estimate of 61 cents.
"We continue to see solid fundamentals in our categories and key markets, including good momentum in emerging markets," Van de Put added.
"Our progress reinforces our confidence that the investments we are making behind our global and local brands, our sales capabilities and our innovation will deliver sustainable long-term growth and create value for our shareholders."