Year in review with the top two
Mondelez: Invests in production, struggles to meet expectations
It was a tough start to the year for Mondelez after it performed below expectations in its first full financial year, partly due to a slowdown for biscuits in China.
Mondelez was among the first to introduce wholesale price hikes in response to rising commodity costs. It faced some resistance from French retailers that dented its earnings in Q3.
In November, the firm acquired a 80% stake in Vietnamese biscuit leader Kinh Do for $370m to spur growth in the rising Asia Pacific market.
Mondelēz’ spent the year restructuring its global manufacturing footprint, closing smaller sub-scale facilities and investing in larger multi-category facilities.
The company announced plans to close plants in Philidelphia, Kenya, Botswana
Plans were also unveiled for a $90m biscuit factory in Bahrain and a $110m factory in Siberia for Milka, TUC and other brands. The firm also said it would consolidate its global choco-bakery production in Hungary as part of a $50m investment. A $24m investment was also announced for its Turkish plant in Gebze where it produces domestic brands such as Falım and Sıpsevd as well as Milka, Halls and Trident.
The company had success in the UK with its Cadbury Dairy Milk Marvellous Creations range in the UK. It introduced brand pairings such as Cadbury with Maynards– many of which came in bite-sized formats in stand up pouches.
Mondelez also premiumized the Cadbury Bournville brand in India by upping the cocoa content and revamping the packaging to capitalize on the growing middle classes.
During the year, the firm launched its Call for Well-being program, which set targets to cut saturated fat and sodium by 10% by 2020. It also aims to manage consumption with portion control by increasing individually wrapped options of 200 calories or less by 25% by 2020
Mondelez’s R&D department filed a patent to produce chocolate using fruit juice that halves fat content and reduces calories.
The firm also opened its Asia-Pacific Chocolate and Confectionery Center of Excellence in Australia, creating a base for its R&D team in the blossoming region.
In the courts, Mondele’z Cadbury business exhausted all avenues of appeal to register a UK trademark for its Dairy Milk purple following an 10-year dispute with Nestlé.
Mondelez also added US ‘activist’ investor Nelson Peltz to its board of directors, who last year encouraged Pepsico to acquire Mondelez.
