Mondelēz International posts drop in second quarter sales, as global economic uncertainties prevail
Mondelez at this year's Sweets & Snacks Expo. Pic: Neill Barston
Mondelēz International has released its latest quarterly results, with figures down 1.9% to $8.3 billion, as the business encountered trading headwinds attributed to unfavourable global exchange rates and divestment of some of its gum business, writes Neill Barston.
Net earnings for the quarter were also challenging, at $601 million, down 36% year-on-year, as the company contented with ongoing challenges of significant increases in cocoa ingredient prices, as well as with sugar.
As the company noted, for 2024, the company has forecast organic net revenue growth to be at the upper end of five to five percent, and comes after a notable presence at this year’s Sweets & Snacks Expo show in Indianapolis.
However, the company noted a number of factors that were anticipated to impact on its expectations for the remainder of 2024. This included the weakness in macroeconomic conditions in our markets, including as a result of inflation (and related monetary policy actions by governments in response to inflation) and the instability of certain financial institutions.
It also noted volatility of commodity and other input costs and availability of commodities, including but not limited to cocoa; as well as observing the negative impact of geopolitical uncertainty – with the ongoing wars in Ukraine and Gaza affecting the company’s logistics chains, as with many other companies operating within the sector.
Dirk Van de Put, Chair and Chief Executive Officer, believed the business was in a comparatively resilient position. He said: “We continued to execute against our strategic growth agenda in the second quarter with strong profitability and attractive cash flow generation. Our performance was fuelled by our commitment to reinvesting in our brands, capabilities, ongoing price execution and cost discipline.
“We are well positioned for the second half of the year with the completion of European pricing, the addition of new value offerings in the U.S. and significant distribution runway across key emerging markets. Our teams remain focused on delivering our long-term growth agenda while remaining agile in this dynamic operating environment.”
