Financial Performance - Net revenues increased 0.2% to 9.3billioninQ12025comparedtothesameperiodintheprioryear,drivenbyhighernetpricingandincrementalrevenuefromtheacquisitionofEvirth[126].−OrganicNetRevenuerose3.19.6 billion in Q1 2025, attributed to higher net pricing, partially offset by unfavorable volume/mix[126]. - Diluted EPS attributable to Mondelēz International decreased 70.2% to 0.31inQ12025,impactedbyunfavorablemark−to−marketchangesandcostsfromtheERPSystemImplementation[126].−AdjustedEPSfell20.40.74 in Q1 2025, with a constant currency decrease of 18.3% to 0.76,drivenbyoperatingdeclinesandhigherinterestexpenses[126].−Netrevenuesforthefirstquarterof2025increasedby23 million (0.2%) to 9,313million,withOrganicNetRevenuegrowthof291 million (3.1%) to 9,556million[131].−NetearningsattributabletoMondeleˉzInternationalwere402 million, a decrease of 1,010million(71.50.31, down 0.73(70.22,047 million (75.1%) to 680million,withAdjustedOperatingIncomedown335 million (19.6%) to 1,375million[134].−Totalsegmentoperatingincomeforthefirstquarterof2025was680 million, a significant decrease of 2,047million(75.12,727 million in 2024[150]. Revenue Drivers - The acquisition of Evirth (Shanghai) Industrial Co., Ltd. was completed in Q4 2024, enhancing the company's presence in the cake and pastry market in China[121]. - The acquisition of Evirth on November 1, 2024, contributed an incremental 99millioninnetrevenuesforthefirstquarterof2025[132].−HighernetpricingwasobservedacrossallregionsexceptNorthAmerica,drivenbycarryoverpricingfrom2024andinputcost−drivenpricingactions[138].−Unfavorablevolume/mixwasexperiencedacrossallregions,reflectingvolumedeclinesduetopricingelasticityimpactsandcategorysoftnessinNorthAmerica[132].−LatinAmericasegmentnetrevenuesdecreasedby116 million (8.8%) to 1,203million,primarilyduetounfavorablecurrencyimpactsandvolumedeclines[152][153].−AMEAsegmentnetrevenuesincreasedby66 million (3.4%) to 2,016million,drivenbyanacquisitionthatcontributed99 million in net revenues[155][156]. - Europe segment net revenues rose by 182million(5.43,550 million, supported by higher net pricing[158][159]. - North America segment net revenues decreased by 109million(4.12,544 million, impacted by unfavorable volume/mix and currency translation[161][162]. Currency and Commodity Impact - In Q1 2025, unfavorable currency-related items impacted Organic Net Revenue by 342million(3.7pp)duetocurrencytranslationratechanges[119].−Currency−relateditemsnegativelyimpactednetrevenuesby342 million due to unfavorable currency translation rate changes[132]. - Commodity costs increased due to higher prices for cocoa, dairy, packaging, energy, and nuts, partially offset by lower sugar, grains, and edible oils costs[179]. - The company expects elevated cocoa costs in the near- and medium-term due to ongoing supply chain disruptions and higher commodity costs[182]. - The company utilizes hedging, higher pricing, and cost control to address commodity cost increases, but may not fully hedge against all cost fluctuations[183]. Operational Challenges - The company anticipates ongoing volatility in future snacks revenue growth due to macroeconomic uncertainties and inflationary pressures[111]. - The war in Ukraine has led to operational challenges, with Ukraine and Russia contributing 0.4% and 3.1% to consolidated net revenue, respectively, in Q1 2025[114]. - The company continues to monitor trade and regulatory uncertainties, particularly regarding tariffs that could significantly impact revenue and costs[112]. - Incremental costs related to the war in Ukraine, including asset impairments and higher allowances for uncollectible accounts, are isolated and excluded from operating results[9]. Capital and Expenditures - The company expects capital expenditures for 2025 to be up to 1.3billion,focusingonmodernizingmanufacturingfacilitiesandsupportingproductivityinitiatives[170].−Dividendspaidinthefirstquarterof2025amountedto623 million, an increase from 578millioninthesameperiodof2024[172].−Totaldebtincreasedto19.5 billion as of March 31, 2025, up from 17.7billionattheendof2024,withadebt−to−capitalizationratioof0.43[176].−Thecompanygenerated1,092 million in net cash from operating activities in the first quarter of 2025, down from $1,324 million in 2024[168][169]. Risk Management - The company faces risks from macroeconomic conditions, geopolitical uncertainties, and changes in consumer preferences that could affect performance[186]. - The company is primarily exposed to currency exchange rate, commodity price, and interest rate market risks, which are managed as part of its overall risk management program[195]. - Derivative instruments are utilized to reduce earnings fluctuations from volatility in currency exchange rates, commodity prices, and interest rates[196]. Non-GAAP Measures - Non-GAAP financial measures, such as Organic Net Revenue and Adjusted Operating Income, are used to evaluate business performance and trends[188]. - Organic Net Revenue excludes impacts from acquisitions, divestitures, and currency-related items, reflecting underlying business growth[191]. - Adjusted Operating Income excludes various impacts, including those from the Simplify to Grow Program and acquisition-related items, to provide comparability of operating results[191]. - The company evaluates its operating performance on a constant currency basis, excluding the effects of currency translation rate changes and extreme pricing increases in Argentina starting Q1 2024[4]. - Unrealized gains and losses from commodity and foreign currency derivative contracts are excluded from non-GAAP earnings measures to remove volatility from future inventory purchases[8]. - Gains and losses on partial or full sales of equity method investments are excluded from non-GAAP financial measures to better reflect underlying operations[15].
Mondelez International(MDLZ)2025-04-29 20:11