Cadbury, Oreo Parent Sees Higher '15 Adjusted Operating Margin


Mondelez International Inc, the maker of Cadbury chocolate and Oreo cookies, reported a better-than-expected adjusted quarterly profit and said it expects cost cuts to boost full-year adjusted operating margin this year.

The company's shares rose 3 percent to $36.86 in early trading.

Continue Reading Below

The snacks maker has faced sluggish growth in some of its key markets and categories and has reported a string of disappointing quarterly results since it split from Kraft Foods Group in 2012.

Like other companies in the food industry, Mondelez has faced sluggish markets in some of its key categories. The company last year announced a restructuring program to help reduce its supply chain operating costs as well as overhead costs through 2018.

The company on Wednesday said it expects adjusted operating income margin to be about 14 percent in the year ending Dec. 31, up from 12.9 percent in 2014, as it benefits from lower costs in the second half of the year.

Mondelez said it expects organic net revenue to grow at least 2 percent in 2015, helped by its decision to focus on its snacks business, which it has done by hiving off its coffee and other businesses.

The company, which gets over 80 percent of its revenue outside the United States, said a strengthening dollar would hit revenue growth by about 11 percentage points and adjusted profit by about 30 cents per share.

Since May, the dollar has surged about 20 percent against a basket of major currencies, making overseas sales denominated in other currencies less valuable in dollar terms.

Net revenue fell about 7 percent to $8.83 billion in the fourth quarter and missed analysts average estimate of $8.88 billion, according to Thomson Reuters I/B/E/S. Revenue rose 2.9 percent on an organic basis, Mondelez said.

Net revenue in Europe, Mondelez's biggest market by sales, fell 6.7 pct. North America revenue decreased 3.1 percent, while revenue in all other markets also fell in the quarter.

Net income attributable to the company fell nearly 72 percent to $500 million, or 29 cents per share.

Excluding items, Mondelez earned 47 cents per share, beating analysts average estimate of 43 cents. (Reporting by Shailaja Sharma in Bengaluru; Editing by Savio D'Souza)