Mondelēz International has posted a net revenues increase of 12.4% driven by Organic net revenue growth of 6.2 percent, favourable currency, and incremental sales from the company’s acquisitions of Hu, Grenade and Gourmet Food in its second-quarter 2021 results. Volume and pricing drove Organic Net Revenue growth, partially offset by an unfavourable mix.
Mondelēz gross profit increased $300 million, while gross profit margin increased 20 basis points to 39.6 percent primarily driven by the increase in Adjusted Gross Profit margin.
Adjusted Gross Profit increased $168 million at constant currency, while Adjusted Gross Profit margin increased 20 basis points to 39.9 percent due to pricing and manufacturing productivity, partially offset by higher raw material costs and unfavorable product mix.
Commenting on the result Dirk Van de Put, Chairman and Chief Executive Officer said,
“We delivered another strong quarter of performance across all key metrics, including top-line, profitability and cash generation. We continue to see strength across the vast majority of our geographies, categories and brands as we remain intensely focused on consistent execution and reinvestment to further strengthen our position.
We are confident that our strategy, long runway of clear growth drivers and advantaged enablers will continue to drive consistent and attractive growth and value generation over the long term.”
Other key financial highlights
- Operating income increased $159 million and operating income margin was 13.1 percent, up 100 basis points primarily due to lower intangible asset impairment charges, lapping prior-year costs associated with the JDE Peet’s transaction and higher Adjusted Operating Income margin, partially offset by higher restructuring costs and the impact of pension participation changes. Adjusted Operating Income increased $68 million at constant currency, and Adjusted Operating Income margin increased 30 basis points to 16.2 percent primarily driven by lower manufacturing costs, pricing and overhead leverage, partially offset by higher raw material costs, unfavourable product mix and higher advertising and consumer promotion spend.
- Diluted EPS was $0.76, up 100.0 percent, primarily due to lapping prior-year costs associated with the JDE Peet’s transaction, a higher gain this quarter on equity method investment transactions, an increase in Adjusted EPS, lower intangible asset impairment charges and favourable year-over-year mark-to-market impacts from currency and commodity derivatives. These factors were partially offset by the unfavourable impact from enacted tax law changes, higher restructuring costs and the negative impact from pension participation changes.
- Adjusted EPS was $0.66, up 1.6 percent on a constant-currency basis driven by operating gains and fewer shares outstanding, partially offset by higher taxes primarily due to a lower net benefit from non-recurring discrete tax items.
- Capital Return: The company returned approximately $900 million to shareholders in cash dividends and share repurchases in the quarter. Today, the company’s Board of Directors declared a quarterly cash dividend of $0.35 per share of Class A common stock, an increase of 11 percent. This dividend is payable on October 14, 2021, to shareholders recorded as of September 30, 2021.
2021 Outlook
Mondelēz International provides its outlook on a non-GAAP basis, as the company cannot predict some elements that are included in reported GAAP results, including the impact of foreign exchange. Refer to the Outlook section in the discussion of non-GAAP financial measures below for more details.
With 2020 net revenues of approximately $27 billion, MDLZ is leading the future of snacking with iconic global and local brands such as Oreo, belVita and LU biscuits; Cadbury Dairy Milk, Milka and Toblerone chocolate; Sour Patch Kids candy and Trident gum.
