News Column

Weak Oreo sales in China crunch Mondelez profit

February 12, 2014

By Jessica Wohl, Chicago Tribune



Feb. 12--Mondelez International Inc. reported a lower-than-expected quarterly profit on Wednesday, as the snack maker posted weak sales of Oreo cookies in China and sold coffee at lower prices.

Deerfield-based Mondelez earned 42 cents per share on an adjusted basis excluding certain items, missing analysts' average forecast by 2 cents per share.

Revenue slipped 0.1 percent to $9.49 billion. Organic revenue, which excludes the impact of items such as acquisitions, divestitures and foreign currency rate fluctuations, rose 2.5 percent. One reason for the weak revenue was that Mondelez passed its lower coffee commodity costs onto customers. Revenue from emerging markets rose 5.9 percent, led by strong gains in India. Revenue from developed markets, including North America, rose just 0.5 percent.

The company formerly known as Kraft Foods Inc. split into two separate companies, Mondelez and Kraft Foods Group Inc., in October 2012. Mondelez, which focuses on global brands such as Oreo, Cadbury and Trident, is under pressure to make improvements and grow more quickly.

Results in the company's first full year on its own "were below what we and our shareholders originally expected," Mondelez Chairman and CEO Irene Rosenfeld said in a statement. She said that Mondelez expects near-term economic conditions will remain "challenging."

Mondelez said it expects to grow its organic revenue by about 4 percent this year, at or above the growth it expects to see in its categories. It forecast 2014 adjusted earnings of $1.73 to $1.78 per share, which would be up from the $1.51 per share it earned in 2013. The company also said it would work on cutting costs and becoming more efficient.

jwohl@tribune.com -- Twitter: @jessicawohl

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Source: Chicago Tribune (IL)


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