Summary
Mondelez International, Inc. (formerly Kraft Foods Inc.) reported a significant increase in net revenues for the first quarter of 2011, reaching $12.6 billion, up 11.1% year-over-year. This growth was largely driven by the Cadbury acquisition, which added $697 million in net revenues, and a 4.6% increase in organic net revenues reflecting higher pricing and favorable volume/mix. However, net earnings attributable to Kraft Foods shareholders saw a substantial decrease of 57.6% to $799 million, with diluted EPS falling to $0.45 from $1.16 in the prior year. This decline is primarily attributed to the significant gain from discontinued operations in the prior year ($1.01 per share from the Frozen Pizza divestiture) and increased integration program costs related to the Cadbury acquisition. Despite the GAAP net earnings decline, operating EPS from continuing operations showed growth, increasing by 6.1% to $0.52, indicating underlying operational improvements. The company is actively managing integration costs post-Cadbury acquisition, expecting significant cost savings. However, investors should note the ongoing impact of commodity price volatility and the ongoing arbitration with Starbucks over the coffee business. The company maintains a strong liquidity position with a new $4.5 billion revolving credit facility.
Financial Highlights
49 data points| Revenue | $8.19B |
| Cost of Revenue | $7.94B |
| Gross Profit | $3.12B |
| SG&A Expenses | $2.93B |
| Operating Income | $1.65B |
| Net Income | $799.00M |
| EPS (Basic) | $0.46 |
| EPS (Diluted) | $0.45 |
| Shares Outstanding (Basic) | 1.75B |
| Shares Outstanding (Diluted) | 1.76B |
Key Highlights
- 1Net revenues increased 11.1% to $12.6 billion, driven by the Cadbury acquisition and organic growth.
- 2Organic net revenues grew 4.6%, supported by higher net pricing and favorable volume/mix.
- 3Net earnings attributable to Kraft Foods decreased by 57.6% to $799 million, largely due to the absence of a large gain from discontinued operations in the prior year.
- 4Diluted EPS decreased significantly to $0.45 from $1.16, impacted by the prior year's divestiture gain.
- 5Operating EPS from continuing operations increased 6.1% to $0.52, demonstrating underlying operational strength.
- 6Integration program costs for the Cadbury acquisition were $104 million in the quarter, with total expected charges of $1.5 billion.
- 7The company entered into a new $4.5 billion senior unsecured revolving credit facility on April 1, 2011.