8-KEarnings & ResultsExhibits & Filings

Mondelez International, Inc. 8-K Report, Financial Results (Nov 2, 2011)

Filed November 2, 2011For Securities:MDLZ

Summary

This 8-K filing from Kraft Foods Inc. (which would later become Mondelez International) reports on the company's third-quarter 2011 earnings. The key takeaway for investors is the company's emphasis on non-GAAP financial measures to provide a clearer picture of its ongoing performance. Specifically, Kraft Foods highlights 'organic net revenues' to exclude the effects of currency fluctuations, acquisitions, and divestitures, offering a more comparable view of revenue trends. Furthermore, the report details 'underlying operating income' and 'Operating EPS' which exclude significant integration costs, acquisition-related expenses (including those from the Cadbury acquisition), and other one-time items. This focus on adjusted figures aims to present a forward-looking operational performance, stripping out the noise from significant corporate activities and strategic adjustments, which is crucial for investors evaluating the core business health.

Key Highlights

  • 1Kraft Foods Inc. reported third-quarter 2011 earnings on November 2, 2011.
  • 2The company utilizes and explains several non-GAAP financial measures for reporting, including organic net revenues, underlying operating income, and Operating EPS.
  • 3Organic net revenues are presented to exclude impacts of acquisitions, divestitures (like the Starbucks CPG business), currency, and accounting calendar changes.
  • 4Underlying operating income and Operating EPS exclude costs related to the Integration Program and acquisition-related expenses, particularly from the Cadbury acquisition.
  • 5The filing emphasizes management's belief that these non-GAAP measures provide improved comparability and a better reflection of ongoing performance.
  • 6Segment operating income is also discussed as a key metric for evaluating segment performance and resource allocation.
  • 7A press release announcing the third-quarter earnings is furnished as Exhibit 99.1.

Frequently Asked Questions

This 8-K filing is primarily to announce Kraft Foods Inc.'s third-quarter 2011 earnings and to provide supplemental financial information through an attached press release. It also details the company's use of non-GAAP financial measures to report its results.

Kraft Foods uses non-GAAP measures to offer investors a view of performance that excludes certain items that can distort year-over-year comparisons. 'Organic net revenues' specifically removes the impact of currency fluctuations, acquisitions, divestitures, and calendar changes, providing a clearer picture of underlying sales trends.

These measures exclude costs associated with the company's Integration Program, acquisition-related expenses (such as transaction advisory fees and stamp taxes, particularly those related to the Cadbury acquisition), and other one-time items like acquisition-related financing fees and certain tax impacts. The aim is to present a more stable and comparable view of profitability.

No, non-GAAP measures are not a substitute for GAAP financial measures. The filing explicitly states that these measures should be viewed in addition to, and not as an alternative for, results prepared in accordance with GAAP. They may also differ from non-GAAP measures used by other companies.