Mondelez International, Inc. (MDLZ - Free Report) reported second-quarter 2017 results, with both earnings and revenues surpassing the Zacks Consensus Estimate.
Second-quarter adjusted earnings of 48 cents per share beat the Zacks Consensus Estimate of 46 cents by 4.3%.
Adjusted earnings grew 19%, primarily driven by operating gains and lower divestiture-related costs.
Sales Details
Net revenue declined 5% year over year to $5.99 billion due to negative currency impact and global cyber attack. Emerging markets’ net revenues decreased 1.5% while developed markets reported revenue declined 7.1%. Power Brands also witnessed 3% decline in revenues.
Regionally, Asia, Middle East & Africa, Europe, and North America registered a respective 3.6%, 5.3% and 8.5% decline in revenues. However, Latin America’s revenues increased 0.6%.
Reported total revenues exceeded the Zacks Consensus Estimate of $5.95 billion.
Organic revenues however declined 2.7%, softer than the 0.6% growth seen last quarter. The downside was primarily due to the global cyber attack, which wreaked havoc across Europe and the U.S. at the end of June.
Pricing increased 1.1%, same as in the previous quarter. Volume mix decreased 3.8%, wider than the 0.5% decline in the last quarter.
Margins
Adjusted gross margin decreased 10 basis points (bps) year over year to 40%, as strong net productivity and pricing gains were primarily offset by an unfavorable mix and higher input costs.
However, adjusted operating margin increased 90 bps year over year to 15.8% on the back of lower selling, general and administrative costs.
Financials
Mondelez reported cash and cash equivalents of $1.4 billion as on Jun 30, 2017, down from $1.74 billion at the end of 2016.
The company returned $900 million of capital to shareholders through share repurchases and dividends in the second quarter.
Mondelez also announced a quarterly cash dividend of 22 cents per share, reflecting an increase of 16%.
2017 Guidance Reaffirmed
Organic net revenue is expected to increase 1% in 2017.
Adjusted operating margin is still expected in the mid 16% range. Mondelez remains on track to reach its 17–18% profit-margin goal by 2018.
Management expects adjusted earnings to increase at a double-digit rate on a constant-currency basis.
Mondelez currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Peer Releases
Dr Pepper Snapple Group Inc. reported second-quarter 2017 adjusted earnings per share of $1.25 missing the Zacks Consensus Estimate of $1.28 by 2.3%. Earnings were flat on a year-over-year basis.
The Hershey Company’s (HSY - Free Report) second-quarter adjusted earnings per share of $1.09 beat the Zacks Consensus Estimate of 91 cents by 19.8%. Earnings also increased from the year-ago profit level of 85 cents by 28.2%.
The Procter & Gamble Company (PG - Free Report) , popularly known as P&G, reported fourth-quarter fiscal 2017 core earnings of 85 cents per share beating the Zacks Consensus Estimate of 78 cents by 9%. The bottom line also increased 8% from the prior-year quarter.
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Mondelez International, Inc. (MDLZ - Free Report) reported second-quarter 2017 results, with both earnings and revenues surpassing the Zacks Consensus Estimate.
Second-quarter adjusted earnings of 48 cents per share beat the Zacks Consensus Estimate of 46 cents by 4.3%.
Adjusted earnings grew 19%, primarily driven by operating gains and lower divestiture-related costs.
Sales Details
Net revenue declined 5% year over year to $5.99 billion due to negative currency impact and global cyber attack. Emerging markets’ net revenues decreased 1.5% while developed markets reported revenue declined 7.1%. Power Brands also witnessed 3% decline in revenues.
Regionally, Asia, Middle East & Africa, Europe, and North America registered a respective 3.6%, 5.3% and 8.5% decline in revenues. However, Latin America’s revenues increased 0.6%.
Reported total revenues exceeded the Zacks Consensus Estimate of $5.95 billion.
Organic revenues however declined 2.7%, softer than the 0.6% growth seen last quarter. The downside was primarily due to the global cyber attack, which wreaked havoc across Europe and the U.S. at the end of June.
Pricing increased 1.1%, same as in the previous quarter. Volume mix decreased 3.8%, wider than the 0.5% decline in the last quarter.
Margins
Adjusted gross margin decreased 10 basis points (bps) year over year to 40%, as strong net productivity and pricing gains were primarily offset by an unfavorable mix and higher input costs.
However, adjusted operating margin increased 90 bps year over year to 15.8% on the back of lower selling, general and administrative costs.
Financials
Mondelez reported cash and cash equivalents of $1.4 billion as on Jun 30, 2017, down from $1.74 billion at the end of 2016.
The company returned $900 million of capital to shareholders through share repurchases and dividends in the second quarter.
Mondelez also announced a quarterly cash dividend of 22 cents per share, reflecting an increase of 16%.
2017 Guidance Reaffirmed
Organic net revenue is expected to increase 1% in 2017.
Adjusted operating margin is still expected in the mid 16% range. Mondelez remains on track to reach its 17–18% profit-margin goal by 2018.
Management expects adjusted earnings to increase at a double-digit rate on a constant-currency basis.
Mondelez currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Peer Releases
Dr Pepper Snapple Group Inc. reported second-quarter 2017 adjusted earnings per share of $1.25 missing the Zacks Consensus Estimate of $1.28 by 2.3%. Earnings were flat on a year-over-year basis.
The Hershey Company’s (HSY - Free Report) second-quarter adjusted earnings per share of $1.09 beat the Zacks Consensus Estimate of 91 cents by 19.8%. Earnings also increased from the year-ago profit level of 85 cents by 28.2%.
The Procter & Gamble Company (PG - Free Report) , popularly known as P&G, reported fourth-quarter fiscal 2017 core earnings of 85 cents per share beating the Zacks Consensus Estimate of 78 cents by 9%. The bottom line also increased 8% from the prior-year quarter.
More Stock News: Tech Opportunity Worth $386 Billion in 2017
From driverless cars to artificial intelligence, we've seen an unsurpassed growth of high-tech products in recent months. Yesterday's science-fiction is becoming today's reality. Despite all the innovation, there is a single component no tech company can survive without. Demand for this critical device will reach $387 billion this year alone, and it's likely to grow even faster in the future.
Zacks has released a brand-new Special Report to help you take advantage of this exciting investment opportunity. Most importantly, it reveals 4 stocks with massive profit potential. See these stocks now>>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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