Summary
Mondelez International, Inc. (formerly Kraft Foods Inc.) reported a strong increase in net revenues for the third quarter and first nine months of 2011, driven by a combination of net pricing increases and favorable volume/mix, especially in its Developing Markets and European segments. The company also benefited from favorable foreign currency movements. While top-line growth was robust, the company continues to navigate integration costs related to the Cadbury acquisition, which are a significant factor impacting profitability. An important strategic development highlighted is the announced intention to spin off the North American grocery business into a separate public company, creating a global snacks business and a North American grocery business. This transaction is intended to unlock shareholder value by allowing each business to focus on its distinct strategic priorities. Investors should monitor the progress and conditions of this spin-off closely. The company's financial performance reflects ongoing integration efforts and strategic restructuring, with a focus on managing input costs and driving organic growth across its diverse product portfolio.
Financial Highlights
49 data points| Revenue | $8.78B |
| Cost of Revenue | $8.61B |
| Gross Profit | $3.25B |
| SG&A Expenses | $2.87B |
| Operating Income | $1.70B |
| Net Income | $922.00M |
| EPS (Basic) | $0.52 |
| EPS (Diluted) | $0.52 |
| Shares Outstanding (Basic) | 1.77B |
| Shares Outstanding (Diluted) | 1.78B |
Key Highlights
- 1Net revenues increased by 11.5% to $13.2 billion in Q3 2011 and by 12.0% to $39.7 billion in the first nine months of 2011, driven by pricing and volume/mix, particularly in developing markets and Europe.
- 2Organic net revenues grew by 8.4% in Q3 and 6.7% in the first nine months, indicating underlying business growth beyond currency and acquisition/divestiture impacts.
- 3The company announced a plan to spin off its North American grocery business to create two independent companies: a global snacks business and a North American grocery business.
- 4Operating income increased by 11.8% in Q3, but net earnings attributable to Kraft Foods decreased by 24.5% for the first nine months due to significant one-time items and integration costs from the Cadbury acquisition in the prior year.
- 5Integration program costs related to the Cadbury acquisition amounted to $112 million in Q3 and $352 million for the first nine months of 2011.
- 6Diluted EPS from continuing operations was $0.52 in Q3, up from $0.43 in the prior year, but overall diluted EPS for the first nine months decreased to $1.52 from $2.09, largely due to discontinued operations in the prior year.
- 7The company is experiencing increased commodity costs, particularly for dairy, coffee, grains, and oils, which are being partially offset by net pricing increases.