Mondelez International, Inc. · NASDAQ:MDLZ
Mondelez International — Q3 2024 Earnings Presentation
40 slides from Mondelez International's earnings presentation, Oct 29, 2024
Slide 1: Q3 2024 Results
Q3 2024 RESULTS October 29, 2024
Slide 2: Forward-Looking Statements; Non-GAAP Financial Measures
FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws. Words, and variations of words, such as “will,” “may,” “expect,” “would,” “cou
Slide 3: Agenda
AGENDA 1 Business & Strategy Update – Van de Put 2 Financial Results – Zaramella 3 2024 Outlook – Zaramella 4 Q&A – Van de Put & Zaramella 3
Slide 4: Strong Execution Driving Accelerated Q3 Results
STRONG EXECUTION DRIVING ACCELERATED Q3 RESULTS 1. Strong top-line growth with positive volume/mix 2. Developed markets growth +MSD, led by recovery in EU post- customer disruption and solid progress in NA Biscuits 3. Emerging markets growth of +MSD 4. Strong profit dollar growth enabling robust Fre
Slide 5: Strong Q3 with Positive Vol/Mix and Robust Profit Delivery
STRONG Q3 WITH POSITIVE VOL/MIX AND ROBUST PROFIT DELIVERY Organic Net Adjusted Gross A&C Change Adjusted Free Cash Flow Revenue Growth Profit Growth1 in Spend1 EPS Growth1 Q3 +5.4% +11.2% +MSD +28.6% 2024 Vol/Mix +0.3pp Price +5.1pp YTD +4.0% +11.4% +HSD +23.0% $2.5B 2024 Vol/Mix -1.4pp Price +5.4p
Slide 6: Growth Recovering in North America and Europe Post-Customer Disruption
GROWTH RECOVERING WITH SOLID PROGRESS IN NORTH AMERICA AND IN EUROPE POST-CUSTOMER DISRUPTION North America Europe Organic Net Revenue Growth Organic Net Revenue Growth +14.5% +12.4% +9.5% +7.3% +8.1% +3.7% +4.4% +2.7% +1.3% +0.3% FY'22 FY'23 Q1'24 Q2'24 Q3'24 FY'22 FY'23 Q1'24 Q2'24 Q3'24 Vol/Mix P
Slide 7: Biscuit & Chocolate Categories Resonating with Consumers
BISCUIT & CHOCOLATE CATEGORIES RESONATING WITH CONSUMERS Consumer Categories1 • Confidence stable • Biscuits category volume growing L3M North • Concern remains with high prices, particularly • Private Label losing volume share L3M America low-income cohort • US Oreo & Ritz, gaining share YTD • Elas
Slide 8: Progressing Against Our Strategic Growth Agenda
PROGRESSING AGAINST OUR STRATEGIC GROWTH AGENDA Scale sustainable snacking Drive M&A Expand distribution Reinvest into brands New, recyclable Evirth paper packaging LU Biscuits – France, Fast growing Cakes & Belgium, UK Brazil C-Store Pastries business in channel: China Oreo Coca-Cola Growing +HSD Y
Slide 9: Cakes & Pastries Is a Big, Growing Category with Runway in China
CAKES & PASTRIES IS A BIG, GROWING CATEGORY WITH LOTS OF RUNWAY, ESPECIALLY IN CHINA Global Packaged China Packaged Cakes & Pastries category 2023 Cakes & Pastries category 2023 ~$95B ~$14B Frozen – • Highly fragmented, natural Chilled ~10% • Largest category in Snacking extension for MDLZ Frozen –
Slide 10: Evirth, a High Growth Leader in Chilled Cakes & Pastries in China
EVIRTH, A HIGH GROWTH LEADER IN CHILLED CAKES & PASTRIES IN CHINA Superior Attractive Leader in Chilled Products Category Cakes & Pastries • Consistently preferred • ~$1.5B segment, • Strategic relationship by the consumer growing double-digit with key customers • High-quality & • Consumers prefer •
Slide 11: Committed to Executing Our Chocolate Strategy with Excellence
COMMITTED TO EXECUTING OUR CHOCOLATE STRATEGY WITH EXCELLENCE 1 2 3 4 Continue to build Ensure right Drive balanced Emerge stronger category growth; consumer value, financial for long-term, gain/hold market adapt quickly to performance sustainable share market dynamics while reinvesting growth in ou
Slide 12: Agenda
AGENDA 1 Business & Strategy Update – Van de Put 2 Financial Results – Zaramella 3 2024 Outlook – Zaramella 4 Q&A – Van de Put & Zaramella 12
Slide 13: Balanced Growth in Q3 Underpinned by Positive Volume/Mix
BALANCED GROWTH IN Q3 UNDERPINNED BY POSITIVE VOLUME/MIX Mondelēz Emerging Markets Developed Markets Organic Net Revenue Growth Organic Net Revenue Growth Organic Net Revenue Growth 39% of Total MDLZ Revenue1 61% of Total MDLZ Revenue1 Q3 +5.4% +4.9% +5.6% 2024 Vol/Mix +0.3% Vol/Mix -1.0% Vol/Mix +1
Slide 14: Strong Growth in Q3 with Improving Volume/Mix Versus H1
STRONG GROWTH IN Q3 WITH IMPROVING VOLUME/MIX VERSUS H1 Biscuits & Baked Snacks Chocolate Gum & Candy Organic Net Revenue Growth Organic Net Revenue Growth Organic Net Revenue Growth 49% of Total MDLZ Revenue1 30% of Total MDLZ Revenue1 12% of Total MDLZ Revenue1 Q3 +3.3% +9.2% +5.6% 2024 Vol/Mix +1
Slide 15: Share Under-Performance YTD Due to US Biscuits and EU Disruption
SHARE UNDER-PERFORMANCE YTD DUE TO US BISCUITS AND EU DISRUPTION, EXPECTING IMPROVEMENT YTG Category Growth1 Snacks Revenue Gaining/Holding Share1 YTD 2024 ~65% +12.5% ~35% +7.8% +4.6% +1.2% Biscuits Chocolate Gum & Candy Total Snacks 2023 YTD'24 & Baked Snacks 1 Share performance and category growt
Slide 16: Accelerated Top-Line Growth Due to Customer Disruption Recovery in Europe
ACCELERATED TOP-LINE GROWTH DUE TO CUSTOMER DISRUPTION RECOVERY IN EUROPE AND SOLID PROGRESS IN NA Organic Net Revenue Growth and Adjusted OI Growth by Region Mondelēz Europe North America AMEA Latin America Q3 Revenue Growth Volume/Mix +5.4% +0.3pp +8.1% +0.5pp +3.7% +1.7pp +5.8% +0.7pp +2.0% -3.9p
Slide 17: Strong Q3 Profit Dollar Growth, Reinvesting in Brands
STRONG Q3 PROFIT DOLLAR GROWTH, CONTINUING TO REINVEST IN OUR BRANDS AND CAPABILITIES Adjusted Gross Profit, Advertising & Consumer Promotions, Overheads and Operating Income Growth1 Q3 YTD’24 +HSD +MSD +LSD +MSD +11.4% +11.2% +22.0% +20.1% 1 at cst fx 17
Slide 18: Significant Earnings Growth Led by Operating Gains
SIGNIFICANT EARNINGS GROWTH LED BY OPERATING GAINS AND COCOA COST PHASING VS FY’24 AVERAGE YTD 2024 EPS vs PY Adjusted, Fav/(Unfav) +23.0% (Cst Fx) +19.1% (Rpt Fx) YTD’2023 Operating Shares Coffee JVs Interest/ Taxes YTD’2024 Forex YTD’2024 Adjusted Gains Other Adj. EPS Adjusted EPS @ Cst FX EPS Q3
Slide 19: Robust Cash Flow Generation, Redeploying for Shareholder Value
ROBUST CASH FLOW GENERATION, REDEPLOYING FOR SHAREHOLDER VALUE Free $2.5 Billion YTD; up +$0.1 Billion vs PY Cash Flow CCC -43 days; +16 days favorable vs PY Share $1.2 Billion YTD Repurchases $70.09 average price Dividends $1.7 Billion YTD, up +$0.1 Billion vs PY 19
Slide 20: Agenda
AGENDA 1 Business & Strategy Update – Van de Put 2 Financial Results – Zaramella 3 2024 Outlook – Zaramella 4 Q&A – Van de Put & Zaramella 20
Slide 21: Cocoa Costs Continue to Decline with Healthy Crop Outlook
COCOA COSTS CONTINUE TO DECLINE WITH HEALTHY CROP OUTLOOK, FUTURES STRUCTURE SIGNALING EVENTUAL NORMALIZATION London Cocoa Spot Price (GBP/Ton) Cocoa Crop Update • Crop outlook remains positive with normalized weather patterns • Significant supply recovery vs last year • Consensus forecasts a surplu
Slide 22: Positioning the Chocolate Business to Emerge Stronger Post-Cocoa Headwind
POSITIONING THE CHOCOLATE BUSINESS TO EMERGE STRONGER POST- COCOA COST HEADWIND Cocoa Costs RGM Cost Discipline • Spike in Cocoa costs from supply • Significant pricing taken across • Scrutinizing major cost buckets deficit, primarily due to adverse industry in last few years considering cocoa cost
Slide 23: FY 2024 Outlook – Continue to Expect On-Algorithm Delivery
FY 2024 OUTLOOK – CONTINUE TO EXPECT ON-ALGORITHM DELIVERY Organic Net Adjusted EPS Free Outlook Revenue Growth Growth (cst. Fx) Cash Flow FY24 Upper-end 3-5% 3-5% HSD% HSD% $3B+ $3.5B+ Mid-point Based on ‘23 Adj. EPS incl. DM Gum LT Algo 2024E LT Algo 2024E LT Algo 2024E FY24 Planning Inflation Adj
Slide 24: Selling JDEP Shares to Continue Focus on Core Categories
SELLING JDEP SHARES TO CONTINUE FOCUS ON OUR CORE CATEGORIES Transaction Financials • Announced agreement to sell our • Selling at €25.10/share full holdings, ~86M shares, to JAB • Net proceeds of ~€2.1B (~$2.35B) • Plan to use proceeds for general corporate purposes • ~$(0.08) net EPS dilution • €0
Slide 25: Q&A
Q&A Dirk Van de Put Luca Zaramella Chairman & CEO CFO 25
Slide 26: Mondelez International – Snacking Made Right
Mondelez, International SNACKING MADE RIGHT
Slide 27: Spot Rates Versus 2023 Average FX Rates for Key Countries
SPOT RATES VERSUS 2023 AVERAGE FX RATES FOR KEY COUNTRIES Source: XE.com Full Year 20231 Oct 22nd Rate Impact vs 2023 Argentine Peso 296.50 / $US 983.77 / $US Australian Dollar US$0.66 / AUD US$0.66 / AUD Brazilian Real 4.99 / $US 5.69/ $US Canadian Dollar US$0.74 / CAD US$0.72 / CAD Chinese Yuan 7.
Slide 28: Outlook
OUTLOOK Our outlook for Organic Net Revenue growth, Adjusted EPS growth on a constant currency basis, Adjusted Interest Expense, Net, Adjusted Effective Tax Rate and Free Cash Flow for full-year 2024 are non-GAAP financial measures that exclude or otherwise adjust for items impacting comparability o
Slide 29: Additional Non-GAAP Financial Measures Definitions
ADDITIONAL NON-GAAP FINANCIAL MEASURES DEFINITIONS “Adjusted A&C” is defined as advertising and consumer promotions (the most comparable U.S. GAAP financial measure) excluding divestitures and incremental costs incurred due to the war in Ukraine. We excluded the items which we believe may obscure tr
Slide 30: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS Net Revenues to Organic Net Revenue (in millions of U.S. dollars) (Unaudited) Latin North Mondelēz America AMEA Europe America International For the Three Months Ended September 30, 2024 Reported (GAAP) $ 1,204 $ 1,851 $ 3,323 $ 2,826 $ 9,204 Currency-related items 1
Slide 31: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS Gross Profit/Operating Income to Adjusted Gross Profit/Operating Income (in millions of U.S. dollars) (Unaudited) For the Three Months Ended September 30, 2024 Gross Operating Net Gross Profit Operating Income Revenues Profit Margin Income Margin Reported (GAAP) $ 9,
Slide 32: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS Gross Profit/Operating Income to Adjusted Gross Profit/Operating Income (in millions of U.S. dollars) (Unaudited) For the Nine Months Ended September 30, 2024 Gross Operating Net Gross Profit Operating Income Revenues Profit Margin Income Margin Reported (GAAP) $ 26,
Slide 33: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS Diluted EPS to Adjusted EPS (Unaudited) For the Three Months Ended September 30, 2024 2023 $ Change % Change Diluted EPS attributable to Mondelēz International (GAAP) $ 0.63 $ 0.72 $ (0.09) (12.5)% Simplify to Grow Program 0.01 0.01 - Intangible asset impairment char
Slide 34: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS Diluted EPS to Adjusted EPS (Unaudited) For the Nine Months Ended September 30, 2024 2023 $ Change % Change Diluted EPS attributable to Mondelēz International (GAAP) $ 2.12 $ 2.92 $ (0.80) (27.4)% Simplify to Grow Program 0.05 0.04 0.01 Intangible asset impairment ch
Slide 35: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS Net Cash Provided by Operating Activities to Free Cash Flow (in millions of U.S. dollars) (Unaudited) Mondelēz International For the Nine Months Ended September 30, 2024 2023 $ Change Net Cash Provided by Operating Activities (GAAP) $ 3,451 $ 3,150 $ 301 Capital Expe
Slide 36: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS Net Revenues to Organic Net Revenue (in millions of U.S. dollars) (Unaudited) Europe For the Twelve Months Ended For the Three Months Ended December 31, December 31, March 31, June 30, 2022 2023 2024 2024 Reported (GAAP) $ 11,420 $ 12,857 $ 3,368 $ 2,874 Divestitures
Slide 37: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS Net Revenues to Organic Net Revenue (in millions of U.S. dollars) (Unaudited) Emerging Developed Mondelēz Markets Markets International For the Three Months Ended September 30, 2024 Reported (GAAP) $ 3,530 $ 5,674 $ 9,204 Currency-related items 170 (50) 120 Organic (
Slide 38: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS Net Revenues to Organic Net Revenue by Consumer Sector (in millions of U.S. dollars) (Unaudited) Biscuits & Baked Gum & Total Cheese & Mondelēz Snacks Chocolate Candy Snacks Beverage Grocery International For the Three Months Ended September 30, 2024 Reported (GAAP)
Slide 39: GAAP to Non-GAAP Reconciliations: Segment Data
GAAP TO NON-GAAP RECONCILIATIONS Segment Data (in millions of U.S. dollars) (Unaudited) For the Three Months Ended September 30, 2024 Unrealized G/(L) on General Latin North Hedging Corporate Amortization Other Mondelēz America AMEA Europe America Activities Expenses of Intangibles Items Internation
Slide 40: GAAP to Non-GAAP Reconciliations: Segment Data
GAAP TO NON-GAAP RECONCILIATIONS Segment Data (in millions of U.S. dollars) (Unaudited) For the Nine Months Ended September 30, 2024 Unrealized G/(L) on General Latin North Hedging Corporate Amortization Other Mondelēz America AMEA Europe America Activities Expenses of Intangibles Items Internationa
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