Mondelez International (MDLZ) operates through its five geographical segments. Europe and North America are the highest contributors to the company’s revenue. Both of the segments contribute ~60% to the total revenue in each quarter. Let’s discuss how each segment performed in 2Q16.
North America’s revenue rose 1% to $1.72 billion for 2Q16. Organic revenue grew 1%—aided by an increase in volume and mix. However, escalated trade spending by its competitors impacted the results slightly. Cookie results were moderate with Oreo, belVita, and Triscuit delivering robust growth. Sour Patch Kids and Hall’s contributed to Candy’s strong results. In gum, Trident produced strong results. The company expects a contribution from the relaunch of Stride in the second quarter.
Revenue in this segment declined 27% to $2.06 billion for 2Q16. Organic revenue in this segment was flat for the quarter. Chocolate and cookie categories delivered solid results in the United Kingdom and Germany. This contributed to 70 basis points growth in volume and mix in the region. Mondelez launched Ritz Crisp & Thin crackers in France. It’s delivering good results to date.
The EEMEA (Eastern Europe, Middle East and Africa) segment’s revenue fell 25% for 2Q16. The organic revenue in this segment fell 3%. Economic and geopolitical volatility and the impact of low oil prices impacted consumer demand in the Middle East and North Africa. This resulted in lower revenues. However, Russia delivered double-digit revenue.
Asia delivered its fifth consecutive quarter of growth with a 2% rise in organic revenue and total revenue in line with the same quarter last year. India profited from the launch of Bournvita biscuits and profit in the chocolate business. Australia and Southeast Asia also had strong results along with the Kinh Do business in Vietnam.
This segment’s revenue fell 32% for 2Q16. Currency and volume headwinds pressured Brazil’s market. Improvements in Argentina and Mexico led to the 9% rise in Latin America’s organic revenue.
Mondelez’s peers in the industry such as General Mills (GIS) and Flowers Foods (FLO) reported revenue of $3.92 billion and $858 million for their last quarter, respectively. Mondelez forms 6% of the Guggenheim S&P Equal Weight Consumer Staples ETF (RHS) and the Consumer Staples Select Sector SPDR Fund (XLP).