Mondelez Combats Sales Slump With Cost Cutting, Lifting Profit
Mondelez International Inc., the global snack giant that recently made a bid to acquire Hershey Co., posted second-quarter earnings that beat estimates after cost cuts helped offset sluggish sales.
Profit was 44 cents a share, excluding some items, the Deerfield, Illinois-based company said Wednesday in a statement. Analysts estimated 40 cents on average. Sales fell 18 percent to $6.3 billion, just shy of analysts’ average projection of $6.33 billion.
Mondelez, the maker of Oreo cookies and Ritz crackers, is trimming expenses in the face of sluggish international markets, where it generates most of its revenue. Chief Executive Officer Irene Rosenfeld also has been under pressure to expand the company’s profit margins, which have trailed those of food-industry competitors. The recent offer for Hershey, which was rejected by the chocolate maker, was seen as an effort to increase Mondelez’s exposure to the U.S. market.
The shares fell 1.1 percent to $44.73 in early trading after the results were released. Mondelez’s stock had gained 0.9 percent this year through Tuesday’s close.
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