Mondelez International reported increased fourth-quarter sales, but higher prices impacted volumes, leading to a more than 2 per cent drop in its shares.
While price hikes boosted profit margins until fiscal 2023, softer demand is now observed as budget-conscious consumers cut back spending.
In North America, Mondelez experienced a 5.5 percentage point volume decline in Q4, driven by weaker biscuit sales and inventory control. The company anticipates customer disruption in Europe during the first and potentially second quarters due to ongoing high inflation.
Overall, Mondelez saw a 0.4 percentage point decline in volume in Q4, echoing a trend among consumer staples firms facing significant price increases.
Despite a gross profit margin exceeding expectations at 37.3 per cent, it was lower than the prior quarter.
Net revenue rose 7.1 per cent to around USD 9.31 billion. Mondelez, like Starbucks, acknowledged business impact from the Israel-Hamas conflict. For 2024, the company projects organic net revenue growth of 3 per cent to 5 per cent and a high single-digit increase in adjusted profit per share on a constant currency basis.
