DEERFIELD, Ill. (AP) — Mondelez International Inc. said Wednesday its net income fell in the third quarter, as revenue took a hit from the stronger dollar in its first quarter as an independent company.
Mondelez, formerly known as Kraft Foods Inc., makes snacks including Oreo cookies, Cadbury and Nabisco. It spun off its North American grocery business and changed its name Oct. 1.
Net income fell to $652 million, or 36 cents per share, in the three months ended Sept. 30. That compares with $922 million, or 52 cents per share, in the prior-year quarter.
Revenue fell 2 percent to $12.9 billion from $13.3 billion. The stronger dollar, which lessens the value of overseas sales, hurt revenue by 4.5 percentage points.
On an adjusted basis, which reflects the spinoff, operating income rose 2.2 percent to $1.1 billion, or 37 cents per share. Revenue fell 5.1 percent to $8.3 billion. The stronger dollar hurt revenue by 6.6 percentage points. Analysts expected income of 36 cents per share on revenue of $8.65 billion, according to FactSet.
CEO Irene Rosenfeld said revenue growth was hurt because there was less of a benefit from price increases compared to a year ago, and the company had "short-term executional missteps" in countries including Brazil and Russia.
In Brazil, Rosenfeld said in a call with analysts, the company was slow to react to a slowdown in gum purchases, so it wound up shipping too much gum into the region as the category slowed down by about half. It also cut marketing support for its biscuits to offset the gum slowdown, which hurt biscuit sales. The marketing support has been restored, Rosenfeld said.
In Russia, the company was hurt by the fact that as coffee and chocolate costs dropped, its competitors cut prices and Mondelez didn't. It has since made relevant price cuts, Rosenfeld said.
Continue reading this story on the...