Mondelez International today (3 February) booked a fourth quarter of 2015 that saw a continuation of trends in the previous three months – underlying profitability up but sales boosted only by price increases.
The Cadbury and Oreo owner published accounts for the final three months of the year and 2015 as a whole that included one-off items that affected the reported numbers.
Fourth-quarter and annual net revenues fell on a reported basis due in part to Mondelez’s move to hive off its coffee business into a venture in which holds it holds a minority stake.
Annual profits were impacted by the proceeds from the coffee transaction, although Mondelez booked a charge due to changes in the way it accounts for its operations in Venezuela. Fourth-quarter earnings were affected by charges linked to the accounting move in the South American country.
Looking at Mondelez’s adjusted figures for its fourth quarter – numbers that stripped out factors including M&A costs, restructuring charges, costs from the coffee transactions and the remeasurement of assets in Venezuela, the company saw an improvement in operating income and operating income margin.
Operating income was up 3.8% at US$1.02bn, with margin rising 1.2 percentage points to 13.9%. Adjusted net earnings were down 6.1% at $739m.
On an organic basis – excluding M&A, the coffee business, integration costs, accounting calendar changes and currency rate fluctuations – net revenue grew 4.7% in the fourth quarter to $7.36bn. However, Mondelez reported a 3.1 percentage point fall in volume/mix, with a 7.8 point rise in pricing.
Reflecting on 2015 as whole, chairman and CEO Irene Rosenfeld said: “We delivered another year of very strong results despite the highly volatile macroeconomic environment. Our aggressive cost-savings programs drove significant margin expansion. In addition, we increased our marketing investments, enabling us to steadily accelerate organic revenue growth and improve our share performance as the year progressed.”
Mondelez organic net revenue by region
- Latin America – +23.8% in Q4 and +19.9% for 2015, as pricing offset volume/mix fall
- Asia Pacific – up 1.2% in Q4 and 1.7% higher for 2015, again helped by pricing
- Eastern Europe, Middle East & Africa – +5.4% in Q4 and 6% higher in 2015, with pricing offsetting lower volumes
- Europe – down 1.1% in Q4 and 1.9% lower in 2015 as a whole. Volumes fell, while pricing was up only 0.2 points in the quarter and 0.8 points for the year
- North America – up 2.6% in Q4, faster than the 0.8% seen for 2015 as a whole. Mondelez increased volumes in both periods.