Summary
Mondelez International, Inc. (MDLZ), formerly Kraft Foods Inc., reported its financial results for the period ending June 30, 2006. The company demonstrated revenue growth, with net revenues increasing to $16.742 billion for the six months ended June 30, 2006, up from $16.393 billion in the prior year period. Net earnings also saw a significant increase to $1.688 billion for the six months ended June 30, 2006, compared to $1.185 billion in the same period of 2005. This growth was driven by continuing operations, which significantly offset losses from discontinued operations. The company continues to implement a broad restructuring program aimed at optimizing its cost structure and capacity utilization. This program, expected to conclude by 2008, has involved facility closures and workforce reductions, with substantial pre-tax charges incurred. Investments in IT services through an agreement with EDS and strategic divestitures, such as the sale of its pet snacks brand, are also shaping the company's operational landscape.
Key Highlights
- 1Net revenues for the six months ended June 30, 2006, increased to $16.742 billion from $16.393 billion in the prior year.
- 2Net earnings for the six months ended June 30, 2006, rose significantly to $1.688 billion, up from $1.185 billion in the same period of 2005, primarily due to earnings from continuing operations.
- 3The company is actively engaged in a multi-year restructuring program involving facility closures and workforce reductions, with significant pre-tax charges recognized for asset impairment, exit, and implementation costs.
- 4Significant divestitures are underway, including the announced sale of the pet snacks brand for $580 million and the sale of sugar confectionery business in June 2005 for approximately $1.4 billion.
- 5Total assets grew slightly to $58.222 billion as of June 30, 2006, from $57.628 billion as of December 31, 2005, with Goodwill being a substantial component at $24.985 billion.
- 6Shareholders' equity increased to $30.368 billion as of June 30, 2006, from $29.593 billion as of December 31, 2005, supported by retained earnings.
- 7The company is expanding internationally with an agreement to acquire United Biscuits' Spanish and Portuguese operations for approximately $1.07 billion.