Snack food giant Mondelez International reported on Monday (Nov. 2) as part of its third quarter earnings results that net revenues grew by 4.9 percent, fueled by 4.4 percent in organic net revenue growth. The company cited good sales of its cookies and chocolates amid the pandemic but said gum sales lagged.
“We are very encouraged by our performance in the third quarter,” Chairman and CEO Dirk Van de Put said on a call with analysts. “Our execution was strong, we continued to accelerate our strategic initiatives, and all of our regions were in growth.”
Organic net revenue expanded in all four of the global company’s regions, according to management. Modelez — whose many popular brands range from Oreo and Chips Ahoy cookies to Halls cough drops and Trident gum — said good sales volume and pricing fueled its expansion. But the company said an unfavorable mix of sales partly offset that.
Van de Put said cookies and chocolate continue to perform well, while gum is still facing “significant pressure” because of pandemic-related changes in consumer mobility and habits.
The executive noted that demand has stayed elevated in developed markets, while pointing out that the company also saw quarter-over-quarter improvement in emerging markets.
Van de Put said sales in a majority of the company’s emerging markets grew in Q3, including key locations such as Russia, Brazil, China and India. However, he noted that conditions vary, and some markets remain challenged.
In terms of marketing, the company is stepping up its working media investments behind its brands in the latter half of 2020. Van de Put noted that was possible because the company decreased its investments during Q2.
“We are seeing good results from this increase in investment,” Van de Put said on the call.
Mondelez International returned $400 million to investors through cash dividends, according to management, which noted that the firm halted its share repurchase program in March.
The company reported $2.3 billion in year-to-date cash provided by operating activities, up $400 million from the past year, and $1.7 billion in free cash flow, up $500 million from the past year.
As for its overall results, Mondelez International reported adjusted earnings per share (EPS) of 63 cents on $6.67 billion in revenue. The results exceeded analyst expectations of 62 cents on $6.48 billion in revenues.