US – American multinational confectionery and snack food company Mondelēz International and its commodity trading counterpart ADM have reported double-digit growth in their quarter 2 (Q2) profits, as businesses starts to recover from pandemic effects.
In its recently released financial results, Mondelēz International reported a 12.4% increase in Q2 net revenue mainly driven by recovering sales in emerging markets.
The owner of Oreo and Cadbury chocolate recorded revenues of US$6.64 billion in the quarter, which it says was driven by organic net revenue growth of 6.2%, a favourable currency, and incremental sales from the company’s acquisitions of Hu, Grenade, and Gourmet Food.
Net revenues in emerging markets rebounded from the 2.5% decline seen in Q4 2020 to a 19.6% growth led by double digit growths in Brazil, India, Russia, and Mexico.
In the Latin America region, the company’s second-quarter revenue grew 30.9% to US$669 million while its Asia, Middle East & Africa net revenues stood at US$1.45 billion, representing a 17.4% increase.
“We remain encouraged by the resiliency and underlying strength of our emerging market, while we continue to invest behind attractive growth opportunities for the long term,” said Dirk Van de Put, chairman and CEO of Mondelēz International, in a conference call.
“We are also expanding our presence in emerging markets, where we continue to gain distribution in key countries like China and India with another 60,000, and 20,000 stores added this quarter.”
The dismal performance of the North American region (only saw a 1.1% increase to $2.05 billion), however, more than offset the 15.7% gains recorded in Europe resulting in an overall modest growth of 8.9% in the company’s developed markets.
Upbeat about its prospects for the remainder of the year, Mondelēz is raising its organic sales outlook for the full-year to an upwards of 4% growth, compared to its previous expectations of +3%.
ADM Q2 surpass estimates
Another company enjoying rebounding of markets was ADM whose earnings and revenue for Q2 surpassed estimates by market analysts.
The agribusiness giant posted revenue of US$22.93 billion in the period beating estimates which had projected the company to record revenues of US$18.2 billion.
Perhaps the most impressive performance for ADM came from its Ag Services & Oilseeds segment which delivered operating profits that were almost 40 percent higher than the previous year’s quarter.
The company’s Carbohydrate Solutions results were also impressive, buoyed by higher sweetener volumes which now reflect the beginnings of a recovery in demand from the foodservice channel.
Ethanol margins also improved versus the prior-year period, driven by a resurgence in driving miles in the US.
The company’s Human Nutrition segment was also just as impressive, delivering a record performance, with 15 percent revenue growth and 27 percent higher year-over-year profits.
“Given our great start to the year and our expectation of continued momentum in the second half, we are confident in delivering very strong full-year earnings, and we remain well-positioned for robust, sustained growth in the years to come,” Chairman and CEO Juan Luciano said.
Earlier, ADM announced that it has agreed to buy Sojaprotein – a European provider of soy ingredients – to expand its plant protein production capacity and customer base.
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