Mondelez International (MDLZ) Q2 2024 earnings summary

Executive summary

• Q2 2024 organic net revenue grew 2.5% year-over-year, driven by higher pricing, despite volume declines and currency headwinds; reported net revenues declined 1.9% to $8.3B, mainly due to unfavorable currency impacts, volume/mix, and the 2023 gum business divestiture.

• Adjusted EPS rose 25.0% at constant currency to $0.86, while diluted EPS fell 34.8% to $0.45, mainly due to mark-to-market impacts, divestiture effects, tax law changes, and impairment charges.

• Free cash flow for H1 2024 was $1.5 billion, flat year-over-year; $2.2 billion was returned to shareholders via dividends and buybacks.

• Announced an 11% increase in the quarterly dividend and launched a multi-year $1.2B ERP transformation program.

• Positioned for multi-year top and bottom-line growth, with reinvestment in brands and expansion into new channels.

Financial highlights

• Q2 2024 organic net revenue grew 2.5% year-over-year; YTD organic net revenue up 3.4%.

• Adjusted gross profit margin rose to 40.5% (up 330 bps); adjusted operating margin increased to 17.9% (up 270 bps) at constant currency.

• Adjusted EPS for Q2: $0.86 (up 19.4% YoY, up 25.0% at constant FX); YTD: $1.82 (up 15.9% YoY, up 20.4% at constant FX).

• Free cash flow was $1.5B YTD, with $2.2B returned to shareholders and $1.1B in share repurchases.

• Dividend increased by 11% to $0.470 per share, marking nine consecutive years of double-digit increases.

Outlook and guidance

• 2024 organic net revenue growth expected at the upper end of 3–5%; high single-digit adjusted EPS growth at constant currency.

• 2024 free cash flow projected at $3.5+ billion.

• Currency translation estimated to reduce 2024 net revenue growth by ~1.5% and adjusted EPS by $0.09.

• EPS guidance maintained despite strong H1 due to anticipated cocoa cost headwinds in H2.

• Management expects continued volatility due to macroeconomic and geopolitical uncertainty, inflation, and supply constraints.