Oreo owner Mondelēz looks to pass on price increases: ‘Chocolate is something people can’t live without’
Owner of Cadburys and Oreo had bumper revenue in the third quarter, with its CEO saying people simply “cannot live without” chocolate.
US conglomerate Mondelēz announced revenues were up more than eight per cent up to September, despite gross profits dipping.
Its revenues in Europe were pushed down in part by a strong dollar, with the company announcing adjusted gross profit decreased $211 million, and its gross profit margin was down 560 basis points to 33.7 percent.
The company, which owns major brands including Diam, TUC, Dairy Milk, Ritz, Philadelphia and Maynards Bassett’s, cited higher raw material and transportation costs, as a key driver in offsetting pricing.
Despite a setback in profits, it raised its outlook for the rest of the year, saying it now expects 10+ per cent in organic net revenue growth, compared to an eight per cent initial outlook.
This suggests the company may try and pass on price rises driven by inflation and input costs to consumers.
On a post-earnings call, chief executive Dirk Van de Put said: “We see consumers saying that chocolate is really something they cannot live without”.
Dirk Van de Put, chairman and chief executive officer, said “despite ongoing macro volatility” the firm is focussed on “delivering on items we can control, including supporting our brands and retaining healthy volumes, while continuing to deliver strong profit dollar growth and long-term share gains.”