By Aditi Sebastian
(Reuters) – Mondelez International Inc raised its year-round organic revenue forecast on Tuesday as more consumers snacked on the food giant’s Oreo cookies and Cadbury chocolates across new markets, including Brazil and China.
Demand for the Toblerone manufacturer’s biscuits and snacks has risen across India, Russia and other emerging markets, which struggled to get sales last year while pandemic-led curbs kept people at home.
“Mobility increases as restrictions ease, but home consumption remains elevated, and it seems that higher levels of working from home and shopping online have come to stay,” CEO Dirk Van de Put said during a call.
Mondelez is now doubling new markets by increasing capacity and increasing production lines instead of opening new facilities with the aim of saving costs. Its segment for new markets brought in 2.29 billion. Dollar in the second quarter, almost 20% higher than last year.
However, the shares of Trident chewing gum producer fell approx. 2% after the market, as the company left its expectation for the whole year unchanged. Mondelez has been exposed to inflationary pressures, although it plans to counter rising commodity prices by raising product prices and reducing packaging costs.
“The guidance for constant currency surplus in 2021 was not raised, which came as a disappointment to some investors,” said JP Morgan analyst Ken Goldman.
Nevertheless, Mondelez expected organic growth throughout the year of more than 4% compared to the previous estimate of an increase of over 3%.
Revenue from the company’s segment for developed markets grew by 8.9% to $ 4.35 billion in the quarter.
Total net income increased 12.4% to $ 6.64 billion. And beat analysts’ average estimate of $ 6.42 billion. According to IBES data from Refinitiv.
(Reporting by Aditi Sebastian and Uday Sampath in Bengaluru; editing by Devika Syamnath)
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