Mondelēz International reported a 4.1 per cent increase in second-quarter net revenue, with the maker of Cadbury, Oreo and Toblerone pointing to improving market share trends in Europe despite continued sales weakness in the region.
Group net revenues rose to $9.36 billion (£7.04bn) in the three months to 30 June, driven by 2.2 per cent organic net revenue growth, favourable pricing and a return to volume growth. Diluted earnings per share jumped 144.9 per cent to $1.20, while adjusted EPS fell 2.7 per cent on a constant currency basis to $0.73.
Reported European revenue slipped 1.0 per cent to $3.38bn during the quarter, while organic revenue declined 3.5 per cent as volume/mix fell 2.1 percentage points and pricing was down 1.4 percentage points. For the first half of the year, however, reported European revenue increased 4.1 per cent, although organic sales were down 2.0 per cent.
Despite the softer European performance, chairman and chief executive Dirk Van de Put said the business is showing encouraging signs.
“Our second quarter results were marked by robust top-line expansion, coupled with volume growth and share improvement, along with improved profitability,” he said.
“We delivered continued strength across our Emerging Markets, as well as strong growth and elevated execution in our North America business. In Europe, share dynamics are showing early positive trends, and we believe the business is well-positioned to build on that progress.
“We are encouraged by the momentum in our business, and we remain focused on executional excellence coupled with reinvesting behind our brands to enable sustained performance for years to come.”
Mondelēz said overall organic growth was driven by 1.5 percentage points of pricing and 0.7 percentage points of favourable volume/mix, reflecting improved consumer demand across its portfolio.
Reported gross profit increased 35.7 per cent to $3.99bn and operating income rose 66.0 per cent to $1.95bn, largely reflecting favourable movements in commodity and foreign currency derivatives. On an adjusted basis, however, gross profit increased 4.9 per cent while adjusted operating income declined 4.8 per cent.
The company also raised its organic revenue outlook for the full year and now expects at least 2 per cent organic net revenue growth, citing the strength of its first-half performance. It maintained its guidance for adjusted EPS growth of between flat and 5 per cent on a constant currency basis.