01—Abstract
Summary
Summary of the 10-K filed February 3, 2023. Cited figures are marked; the original filing is the authoritative source.
Mondelez International, Inc. reported strong net revenue growth of 9.7% to $31.5 billiona for the fiscal year ended December 31, 2022.
This growth was primarily driven by a combination of higher net pricing and favorable volume/mix across its snack categories, further boosted by strategic acquisitions including Chipita, Clif Bar, and Ricolino. Despite the revenue increase, reported operating income and net earnings saw a significant decline year-over-year, largely due to lapping prior-year gains on equity method transactions, unfavorable mark-to-market impacts, and costs associated with the war in Ukraine, the European Commission legal matter, and integration expenses. Adjusted EPS showed a modest increase of 3.5% to $2.95b, or 11.9% on a constant currency basis, indicating resilience in core operational performance.
The company operates across four segments: Latin America, AMEA, Europe, and North America, with all segments contributing to net revenue growth, particularly Latin America and North America. Challenges include persistent inflation, supply chain disruptions, and currency volatility, particularly the strengthening U.S. dollar, which negatively impacted reported results.
Mondelez International is actively managing these challenges through pricing actions, cost controls, and strategic investments, focusing on its four growth priorities: consumer-centric growth, operational excellence, a winning growth culture, and scaling sustainable snacking. The company also continues its share repurchase program, demonstrating a commitment to returning value to shareholders.
02—Key points
Key Highlights
- Net revenues increased by 9.7% to $31.5 billion in 2022, driven by higher pricing, acquisitions, and favorable volume/mix.
- Diluted EPS attributable to Mondelēz International decreased by 35.5% to $1.96 in 2022, largely due to one-time charges and prior-year gains.
- Adjusted EPS increased by 3.5% to $2.95 in 2022, indicating underlying operational strength.
- The company completed three significant acquisitions in 2022: Chipita, Clif Bar & Company, and Ricolino, to expand its portfolio.
- Unfavorable currency translation negatively impacted net revenues by $1.9 billion.
- The company incurred incremental costs due to the war in Ukraine, impacting operating income.
- Mondelez International is executing on its 'Simplify to Grow' program aimed at cost structure optimization and operational efficiencies.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2022, Mondelez International, Inc. kept $0.09.
- Revenue$31.50B100.0%
- Cost of revenue−$20.18B64.1%
- Gross profit$11.31B35.9%
- Operating costs−$7.78B24.7%
- Operating income$3.53B11.2%
- Interest, other & tax−$817.0M2.6%
- Net income$2.72B8.6%
Where FY2022 revenue went
$31.50B- Cost of revenue: $20.18B, 64% of revenue
- SG&A: $7.38B, 23% of revenue
- Net income: $2.72B, 8.6% of revenue
- R&D: $346.0M, 1.1% of revenue
- Interest, other & tax: $817.0M, 2.6% of revenue
Kept 8.6% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2022filed February 3, 2023Financial Statements
FY2022 against FY2021
| Line item | FY2022FY2021 | Change |
|---|---|---|
| Revenue | $31.50B$28.72B | +9.7% |
| Cost of Revenue | $20.18B$17.47B | +15.6% |
| Gross Profit | $11.31B$11.25B | +0.5% |
| R&D Expenses | $346.00M$347.00M | −0.3% |
| SG&A Expenses | $7.38B$6.26B | +17.9% |
| Operating Income | $3.53B$4.65B | −24.0% |
| Interest Expense | $428.00M$365.00M | +17.3% |
| Net Income | $2.72B$4.30B | −36.8% |
| EPS (Basic) | $1.97$3.06 | −35.6% |
| EPS (Diluted) | $1.96$3.04 | −35.5% |
| Shares Outstanding (Basic) | 1.38B1.40B | −1.8% |
| Shares Outstanding (Diluted) | 1.39B1.41B | −2.0% |
05—Questions
Frequently Asked Questions
What drove Mondelez's revenue growth in 2022?
Mondelez International's net revenues grew by 9.7% to $31.5 billion in 2022. This growth was primarily fueled by higher net pricing across its categories, the incremental revenue from recent acquisitions (Chipita, Clif Bar, and Ricolino), and a favorable volume/mix, particularly in emerging markets. The company benefited from continued consumer demand for its snack products.
Why did reported earnings per share (EPS) decrease significantly in 2022?
Reported diluted EPS decreased by 35.5% to $1.96 in 2022 primarily due to several one-time items and the comparison against a strong prior year. Key factors included lapping prior-year net gains on equity method transactions, unfavorable year-over-year mark-to-market impacts from derivatives, costs associated with the European Commission legal matter, incremental costs incurred due to the war in Ukraine, higher acquisition-related and integration costs, and intangible asset impairment charges.
How is the company managing rising input costs and inflation?
Mondelez International is addressing rising input costs and inflation through a multi-pronged strategy. This includes implementing higher net pricing across its products, driving operational excellence to improve efficiencies and reduce costs through programs like 'Simplify to Grow,' and utilizing hedging techniques for raw materials. The company is also focused on optimizing its supply chain and managing overhead costs to mitigate the impact on profitability.
What is the impact of the company's acquisitions on its financial performance?
In 2022, Mondelez completed significant acquisitions, including Chipita, Clif Bar & Company, and Ricolino. These acquisitions contributed to the company's net revenue growth, expanding its presence in key snacking categories and geographies. While these acquisitions add scale and strategic value, they also incurred acquisition-related and integration costs, which impacted reported earnings in 2022. The company anticipates these businesses will contribute positively to future growth and profitability.
06—Continue