Mondelez International(MDLZ)2024-06-04 18:30Summary of Mondelez International, Inc. Conference Call Company Overview - Company: Mondelez International, Inc. (NASDAQ:MDLZ) - Date: June 4, 2024 - Participants: Dirk Van de Put (Chairman & CEO), Luca Zaramella (CFO), Steve Powers (Deutsche Bank) Key Points Strategic Focus and Growth - The company has shifted focus from cost-cutting to growth since 2018, emphasizing consumer-centric strategies and marketing revamps [4][5] - Mondelez has successfully delivered results above its financial algorithm, aided by inflation and a focus on both global and local brands [4][5] - Future growth opportunities include geographical expansion, improved execution, and continued bolt-on acquisitions [6][7] Consumer Behavior and Market Trends - Post-COVID, there has been a shift from in-home to on-the-go consumption, with inflation impacting consumer spending habits [9][10] - In the U.S., consumers are increasingly price-sensitive, shifting to discount channels and private labels, leading to a decline in volume [13][14] - The company plans to adjust pricing strategies and promotions to regain consumer interest in its products [15][16] Cocoa Market Insights - Cocoa prices have been volatile, currently around £7,400 per ton, with expectations of a decline as supply normalizes [38][39] - The company has long-term coverage in cocoa, allowing it to manage price fluctuations effectively [40][41] - Anticipated normalization of cocoa prices could lead to cost pressures in 2025, but the company remains focused on long-term strategies [44][46] Distribution and Market Expansion - Mondelez aims to add 3 million new stores by 2030, focusing on high-potential markets like India, China, and Brazil [27][29] - The company is underrepresented in discount channels in the U.S. and is working to optimize its presence in convenience stores [33][34] - Emerging markets are seen as a strength, with significant growth opportunities through distribution gains and same-store sales [31][32] M&A Strategy - Mondelez has developed a strong M&A capability, focusing on disciplined financial practices and strategic fit for acquisitions [48][50] - The company is currently integrating recent acquisitions and is cautious about pursuing new ones in the short term due to market conditions [53][54] Long-term Outlook - The company remains optimistic about its categories, particularly in snacking, with a focus on innovation and brand strength [21][22] - The shift in consumer behavior towards snacking presents significant growth potential, especially in emerging markets [23][24] - Mondelez's global footprint and market leadership position it well for future growth opportunities [25][26] Additional Insights - The company has seen a significant increase in chocolate prices (30% over two years) while maintaining volume growth [10] - The shift in consumer purchasing behavior has led to a need for strategic adjustments in pricing and product offerings [12][15] - The company is committed to maintaining entry-level price points in emerging markets to attract consumers [44][46]