On October 29, 2024, Mondelez International Inc (MDLZ, Financial) released its 8-K filing detailing its third-quarter 2024 financial results. The company reported net revenues of $9,204 million, exceeding analyst estimates of $8,454.42 million. However, its diluted earnings per share (EPS) of $0.63 fell short of the estimated $0.78.
Company Overview
Mondelez International Inc (MDLZ, Financial), a leader in the global snack industry, has been operating independently since its separation from Kraft Foods in 2012. The company boasts a diverse portfolio, including popular brands such as Oreo, Chips Ahoy, Halls, and Cadbury. Mondelez generates approximately one-third of its revenue from developing markets, with significant contributions from Europe and North America.
Performance Highlights and Challenges
Mondelez reported a 1.9% increase in net revenues, driven by a 5.4% growth in organic net revenue. This growth was primarily attributed to higher net pricing and favorable volume/mix. However, the company faced challenges, including a 12.5% decline in diluted EPS, impacted by unfavorable changes in mark-to-market impacts from currency and commodity derivatives, and higher intangible asset impairment charges.
“We posted robust results for Q3, with accelerated top-line growth, strong earnings and attractive cash flow generation. These results were driven by our commitment to executing with excellence across our categories, markets and brands,” said Dirk Van de Put, Chair and Chief Executive Officer.
Financial Achievements and Industry Importance
Mondelez's adjusted EPS on a constant currency basis rose by 28.6% to $0.99, highlighting strong operational gains and effective cost management. The company also generated $3.5 billion in year-to-date cash from operating activities and $2.5 billion in free cash flow, underscoring its financial resilience and ability to reinvest in its brands and capabilities.
Key Financial Metrics
The company's gross profit decreased by 14.2% to $2,999 million, with a gross profit margin of 32.6%. Operating income also saw a decline of 16.4% to $1,153 million, with an operating income margin of 12.5%. Despite these declines, Mondelez's adjusted operating income increased by 20.9% at constant currency, driven by higher pricing and productivity improvements.
| Metric | Q3 2024 | % Change vs PY |
|---|---|---|
| Net Revenues | $9,204 million | +1.9% |
| Organic Net Revenue Growth | 5.4% | - |
| Diluted EPS | $0.63 | -12.5% |
| Adjusted EPS (Constant Currency) | $0.99 | +28.6% |
Analysis and Strategic Moves
Mondelez's strategic focus on expanding its capabilities and maintaining cost discipline has been pivotal in navigating the current economic landscape. The company's recent agreement to acquire a majority stake in Evirth, a leading manufacturer of cakes and pastries in China, exemplifies its commitment to portfolio expansion and leveraging its iconic brands in high-growth categories.
Overall, Mondelez International Inc (MDLZ, Financial) demonstrated resilience in its Q3 2024 performance, with strong revenue growth and strategic initiatives positioning the company for future success in the competitive consumer packaged goods industry.
Explore the complete 8-K earnings release (here) from Mondelez International Inc for further details.
