10-K/APeriod: FY2007

Mondelez International, Inc. Annual Report (Amendment), Year Ended Dec 31, 2007

Filed February 26, 2008For Securities:MDLZ

Summary

Mondelez International, Inc. (MDLZ), formerly Kraft Foods Inc., filed an amendment to its 2007 annual report on Form 10-K. The company reported strong net revenue growth of 8.4% to $37.2 billion in 2007. However, diluted Earnings Per Share (EPS) saw a decline of 12.4% to $1.62, impacted by significant restructuring charges and other one-time expenses. A major event during the year was the acquisition of Groupe Danone S.A.'s global biscuit business for approximately $7.6 billion, which is expected to enhance its international presence. Concurrently, the company announced an agreement to merge its Post cereals business with Ralcorp Holdings, Inc., a transaction anticipated to close in mid-2008. The company also continued its share repurchase program, demonstrating a commitment to returning capital to shareholders. Investors should note the significant increase in commodity costs, particularly for dairy, coffee, and grains, which impacted operating income despite higher pricing actions. The company's strategy focuses on organizational restructuring, category reframing, sales capability enhancement, and cost reduction, with a plan to realize substantial savings from ongoing restructuring programs. Overall, the company navigated a complex year with strategic acquisitions and divestitures, while facing input cost pressures.

Financial Highlights

49 data points
Beta

Revenue

$35.86B

34.0% Gross Margin

Net Income

$2.72B

7.6% Net Margin

EPS (Diluted)

$1.70

Total Assets

$68.13B

Cash & Equivalents

$567.00M

Free Cash Flow

$2.33B

Financial Statements
Beta
Revenue$35.86B
Cost of Revenue$23.66B
Gross Profit$12.20B
SG&A Expenses$7.59B
Operating Income$4.18B
Net Income$2.72B
EPS (Basic)$1.71
EPS (Diluted)$1.70

Key Highlights

  • 1Net revenues increased by 8.4% to $37.2 billion in 2007.
  • 2Diluted Earnings Per Share (EPS) decreased by 12.4% to $1.62 in 2007.
  • 3Completed the acquisition of Groupe Danone S.A.'s global biscuit business for approximately $7.6 billion.
  • 4Announced definitive agreement to merge the Post cereals business with Ralcorp Holdings, Inc., expected to close in mid-2008.
  • 5Repurchased $3.6 billion of its Common Stock under its share repurchase programs.
  • 6Announced an 8.0% increase in the quarterly dividend rate to $0.27 per share.
  • 7Experienced a significant increase in aggregate commodity costs, rising approximately $1.25 billion in 2007.

Frequently Asked Questions

In 2007, Mondelez International reported a significant increase in net revenues, growing 8.4% to $37.2 billion. However, diluted Earnings Per Share (EPS) declined by 12.4% to $1.62, largely due to restructuring charges and increased commodity costs.

The company made two major strategic moves: it acquired the global biscuit business of Groupe Danone S.A. for approximately $7.6 billion to strengthen its international portfolio, and it announced the planned merger of its Post cereals business with Ralcorp Holdings, Inc., which was expected to be completed in mid-2008.

Rising commodity costs, particularly for dairy, coffee, cocoa, wheat, and soybean oil, significantly impacted the company's profitability. Aggregate commodity costs rose by approximately $1.25 billion in 2007 compared to 2006. While the company implemented higher pricing, it was not fully enough to offset these increased input costs, leading to a decline in operating income.

For 2008, Mondelez International projected diluted EPS of at least $1.56, reflecting anticipated costs related to its restructuring program and an estimated effective tax rate of 34.0%. The outlook included the full-year impact of the Danone Biscuit acquisition but did not include the Post cereals business merger.