Mondelēz emerges from pandemic 'stronger than ever', says CEO
"We had a strong start to the year despite lapping our highest growth quarter in 2020 and Q1 reconfirmed that we are emerging from COVID even stronger," said Van De Put on the company's Q1 2021 earnings call.
The global snacking company increased net revenues by 7.9% for the quarter driven by organic net revenue growth of 3.8% across all international regions. In North America, net revenues were up 4.3% for the quarter, and organic net revenue growth declined 2.3%.
The company saw its largest net and organic revenues gains in its Asia, Middle East & Africa segment, where it has expanded its retail presence (+120,000 stores in China and +60,000 stores in India).
"And a good business converts top line results into cash and for the quarter, we generated $700m, which is the best first quarter since the formation of the company, which continues to enable us for strong capital return to our investors," added Van De Put.
'Attractive and resilient categories'
Legacy biscuit brands -- Chips Ahoy, Oreo, and Tate's (acquired in 2018) -- which make up 85% of the company's revenue base, all posted growth for the quarter with the Oreo brand being "a clear winner," noted Van De Put.
"Oreo has been growing at a double-digit CAGR since 2018, as we activate and pursue a $1bn opportunity over the next three years via geographical expansion and share gains," said Van De Put.
Premium and wellbeing
Beyond investing in and growing its well-known snacking brands, Mondelēz has identified significant growth opportunities in the premium and well-being snacking market.
"Our focus has always been to increase our exposure to high growth segments like premium and well-being, enter geographic white spaces in our core categories, or expand into fast-growing adjacencies," said Van De Put.
Over the past few years, the company has acquired and invested in a number of emerging and fast-growing brands including Perfect Snacks, Uplift Food, and Hu Products, which Van De Put says have a lot more runway beyond the natural channel.
"[Hu] is the fastest-moving chocolate brand in Whole Foods, but currently has limited presence in more conventional retailers, which is a clear opportunity," said Van De Put.
"As we have seen with our prior acquisitions of Tate's and Perfect Snacks, these platforms provide leadership positions in new or adjacent categories of increasing relevance with our consumers. They represent large addressable markets, are financially attractive, and create new growth path for us," he added.
Acquisition targets: 'We're hesitant to get into other food categories'
When asked about the company's acquisition strategy, Van De Put said anything in the snacking world, small or big, is fair game.
"We want to stay in snacking, and we want to accelerate our growth rate. So we know where that needs to come from. It has to come from the adjacencies, some of the geographical white spaces, and some of the fast-growing segments that we have in our current market," he said.
"So if there would be a larger acquisition that would provide us the opportunity to get bigger in snacking and/or get an accelerated growth rate, we're certainly open to it. But it's just very difficult to find, and we're hesitant."
