Mondelēz to up Cocoa Life investment on back of strong Q3 results

The Cadbury and Oreo maker said gross profit margins decreased slightly, for mixed reasons, including increased transport and labour costs as well as the effects of a strong dollar.

"Our third quarter performance demonstrates the resilience of our snacking categories, strength of our brands, broad-based net revenue growth of both our emerging and developed markets, effective execution of pricing, and solid volume growth, enabling us to raise our full-year revenue and earnings outlook​,” said Dirk Van de Put, the company’s Chairman and Chief Executive Officer.

“Despite ongoing macro volatility, we remain focused on executing against our strategy and 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​.”

Cocoa life

Mondelēz also announced incremental investment into its Cocoa Life sustainability programme to reach a total of $1.0 billion and expand its goal to source all the company’s cocoa volume from Cocoa Life by 2030.

While analysts were broadly positive about the company’s Q3 results, Mondelēz  said it is also battling a volatile environment in its European market, which recorded a 2.4% fall in quarterly revenues, as consumers tighten their belts amid soaring rent and energy costs. Some of its high-margin product lines, particularly in France and other parts of Europe, were impacted by disruptions regarding pricing from retailers.

“Consumers in developed markets continue to prioritise groceries over other forms of spending, and they continue to view our brands as affordable indulgences,” ​said Van de Put in an earnings call to journalists and analysts. “Meanwhile, in emerging markets, consumer confidence remains strong with growing demand for our categories and continued loyalty to our iconic brands​,” he added.

The company's chief executive also said it will increase A&C (Advertising & Commercial) spending to make sure consumers maintain trust in its brands, even if they become more expensive. “Increasing our advertising will lead to increased volume, will lead to increased net revenue growth. We see consumers saying that chocolate is really something they cannot live without​," he said.