What was the primary driver for the increase in net earnings and EPS in Q3 2018?

The significant increase in net earnings and EPS was primarily driven by a substantial pre-tax gain of $757 million ($573 million after-tax) recognized on the company's investment in Keurig Dr Pepper (KDP) following its merger with Dr Pepper Snapple Group. Lower taxes and operating gains also contributed.

How did the company's revenue performance vary across its segments?

In Q3 2018, Latin America experienced a significant net revenue decrease of 14.8%, largely due to unfavorable currency. AMEA saw a slight decrease of 0.5%, while Europe's net revenues declined 3.3%. North America's net revenues decreased by 1.1%. For the nine months, Europe and North America showed modest revenue growth, while Latin America experienced a decline, and AMEA remained relatively flat.

What is the status of the "Simplify to Grow" restructuring program?

Mondelez extended and increased its "Simplify to Grow" restructuring program. The program now totals $7.7 billion, comprising $5.4 billion in program charges and $2.3 billion in capital expenditures, with an extended completion timeline through 2022. The objective is to reduce operating cost structure in the supply chain and overhead.

What impact did currency fluctuations have on the company's results?

For Q3 2018, an unfavorable currency translation weakened the U.S. dollar against most operating currencies, negatively impacting net revenues by $323 million and operating income by $60 million. For the nine-month period, favorable currency impacts increased net revenues by $40 million, but operating income saw a smaller favorable impact of $19 million due to offsetting currency movements.

MDLZ 10-Q Quarterly Report Q3 FY2018 — Revenue, Net Income, EPS

Summary

Mondelez International, Inc. (MDLZ) reported a net revenue decrease of 3.7% to $6.3 billion for the third quarter of 2018, compared to the same period in the prior year, primarily attributed to unfavorable currency translation and lapping the prior year's recovery from a malware incident. However, Organic Net Revenue, a non-GAAP measure, saw an increase of 1.2%, driven by higher net pricing. Diluted Earnings Per Share (EPS) saw a significant increase of 26.6% to $0.81, boosted by a substantial after-tax gain on the Keurig Dr Pepper (KDP) transaction and lower taxes. The nine-month period showed a net revenue increase of 1.2% to $19.2 billion, with Organic Net Revenue growing by 2.3%. Diluted EPS for the nine months rose 23.7% to $1.72. The company's liquidity remains strong, supported by operating cash flow and revolving credit facilities, enabling continued investment in capital expenditures and share repurchases. The company also announced an increased and extended restructuring program, "Simplify to Grow," aiming to reduce operating costs.

Financial Highlights

53 data points

Beta

Revenue

$6.29B

0.4% Gross Margin

Net Income

$1.19B

0.2% Net Margin

EPS (Diluted)

$0.81

Total Assets

$63.92B

Free Cash Flow

$425.00M

Financial Statements

Beta

Revenue	$6.29B
Cost of Revenue	$3.87B
Gross Profit	$2.41B
SG&A Expenses	$1.51B
Operating Income	$737.00M
Interest Expense	$117.00M
Net Income	$1.19B
EPS (Basic)	$0.81
EPS (Diluted)	$0.81
Shares Outstanding (Basic)	1.47B
Shares Outstanding (Diluted)	1.48B

Key Highlights

1Net revenues decreased 3.7% year-over-year in Q3 2018 to $6.3 billion, but Organic Net Revenue (non-GAAP) increased 1.2%.
2Diluted EPS increased 26.6% to $0.81 in Q3 2018, significantly boosted by a $757 million pre-tax gain on the KDP transaction.
3For the nine months ended September 30, 2018, net revenues increased 1.2% to $19.2 billion, with Organic Net Revenue up 2.3%.
4Diluted EPS for the nine-month period increased 23.7% to $1.72.
5The company acquired Tate's Bake Shop for $528 million in June 2018.
6Short-term borrowings increased significantly to $4.8 billion as of September 30, 2018, from $3.5 billion at year-end 2017.
7Net cash provided by operating activities was $1.9 billion for the first nine months of 2018, a substantial increase from $0.8 billion in the prior year.

Mondelez International, Inc. Quarterly Report for Q3 Ended Sep 30, 2018

Summary

Financial Highlights

Key Highlights

Frequently Asked Questions