The decision comes after Mondelēz launched a review of its gum business last year. The company has begun looking for a buyer and there's no timeline yet for a sale, a spokesperson told CNN Business.
In an investor event held on Tuesday, Mondelēz updated its long-term algorithm to 3 to 5% organic net revenue growth, up from previous guidance of 3%+.
“Our competitive advantages in the marketplace and focused strategy on global snacking leadership give us great confidence in our ability to sustain strong top- and bottom-line growth for many years to come,” said Dirk Van de Put, Chairman & CEO. “Building on our category leadership, favorable geographic footprint, and the power of our iconic brands, we are well positioned for stronger growth in the decade ahead.”
The company also disclosed its intention to divest the global Halls business. Mondelēz will maintain the brands and products within its candy business, as well as its emerging market gum business.
In the early days of the Covid pandemic, gum sales dropped considerably as foot traffic at convenience stores slowed and more people stayed home, hitting Mondelēz’s gum revenues which were already dipping in certain markets.
The company reported it will continue to prioritise growth, execution and culture as three pillars of its strategy — investing in differentiated marketing and sales capabilities, while strengthening its local-first operating model to empower employees and promote a growth culture.
By further advancing its Snacking Made Right agenda across a focused set of environmental, social and governance priorities, Mondelēz said it aims to help drive positive change at scale, creating long-term value for both the business and its stakeholders.
It told investors it viewed chocolate and biscuits as historically durable categories in both developed and emerging markets, with significant headroom to increase penetration and per capita consumption.
As it continues to reshape its portfolio, Mondelēz said it will drive value through organic growth and targeted acquisitions that expand its presence in chocolate, biscuits and baked snacks by filling geographic gaps and extending into under-represented segments and price tiers.
The eight acquisitions the company has completed or announced since 2018 add $2bn in annual revenue, and have had an average growth rate in the high single digits.
“Our growth ambition will not be possible without the passion, dedication and commitment of our people – the very best in the consumer packaged goods industry,” Van de Put says. “To accelerate our growth and focus, we are taking our talent and culture strategy to the next level – by doubling down on initiatives to advance diversity, equity and inclusion; expanding investment in top talent programs; and rolling out a global, holistic employee well-being programme.”
The company says it continues to expect adjusted EPS growth on a constant currency basis in the high single digits and gradually increasing free cash flow of $3bn-plus over the long term.