Latest news with #VandePut
Yahoo
02-05-2025
- Business
- Yahoo
Snacking takes a hit as consumer spending shifts to food staples
This story was originally published on Food Dive. To receive daily news and insights, subscribe to our free daily Food Dive newsletter. As consumers rein in spending, the once seemingly unstoppable snacking category is taking a hit. Food giants, including PepsiCo, Mondelēz International and The Campbell's Company, are reporting a slowdown in snack sales as inflation and growing economic uncertainty discourage consumers from purchasing as many cookies, crackers and other treats. Dirk Van de Put, Mondelēz's CEO, told analysts that consumers are purchasing fewer snacks in favor of grocery staples such as meats, vegetables and eggs. In North America, one of the Oreo and Chips Ahoy! maker's biggest markets, net revenues during its most recent quarter dropped 4.1%. 'We see consumers switching to more essentials in grocery, and snacking categories are suffering as a consequence of that,' CEO Dirk Van de Put told analysts. 'What's going on is that the consumer feels very uncertain about the future.' Snacking executives have painted a dour outlook across the food space, with little optimism that things will improve anytime soon. Van de Put told Wall Street he didn't 'expect to see a significant improvement in consumer confidence in the near term in the US.' Last week, PepsiCo's CFO Jamie Caulfield noted consumer sentiment has worsened since February when it reported a slowdown in demand for its snacks and beverages. 'We probably aren't feeling as good about the consumer now as we were a few months ago,' Caulfield said. PepsiCo's snack business has continued to struggle. During its first quarter, PepsiCo said organic revenue in its North American foods business slipped 2%. Executives noted a 'subdued' performance in savory snacks, led by its Frito-Lay business that oversees brands including Doritos and Cheetos. 'Revenue management clearly is becoming more complex as consumers are feeling more challenged with their disposable income,' said Ramon Laguarta, PepsiCo's CEO. The pressure facing snacks prompted competitor The Campbell's Company to lower its outlook last month. The soup and snacks maker forecast sales to rise 6% to 8% this year, instead of 9% to 11%. Organic sales projections also were lowered to be flat or drop by up to 2%. Previously, the company was predicting sales to be unchanged or up 2%. CEO Mick Beekhuizen noted Campbell's was dealing with 'softness' in some snacking categories, most notably cookies and crackers. 'The broader snacking categories didn't improve as we had originally anticipated,' Beekhuizen conceded. As concerns about inflation continue to mount, snack makers are beginning to roll out more affordable options. Shopper loyalty to Mondelēz's biscuit brands 'remains solid,' the CEO noted, and a focus on selling more offerings under $4 is helping to drive share gains. Similarly, PepsiCo launched smaller, single-serve items under $2 and smaller multi-pack options designed to keep the consumers in its brands and promote purchase frequency. And while snacking consumption remains subdued, some categories are faring better than others. Mondelēz's biscuit business, which includes Oreo, Ritz, Triscuit and Chips Ahoy!, is holding up 'better than many other snacking' categories, Van de Put said. Recommended Reading PepsiCo CEO says snacks maker 'accelerating' transition to natural ingredients
Yahoo
18-02-2025
- Business
- Yahoo
Mondelez CEO says Kennedy agenda product re-formulations will mean price hikes
By Jessica DiNapoli ORLANDO (Reuters) - Mondelez CEO Dirk van de Put on Tuesday said the Oreo maker will face new cost pressures from the Make America Healthy Again movement spearheaded by U.S. health secretary Robert F. Kennedy Jr and that Americans would see price hikes. Make America Healthy Again could require that Mondelez reformulate its U.S. products, which include Ritz crackers and Chips Ahoy cookies, Van de Put said at an industry conference. That would mean swapping out ingredients and food dyes it currently uses. Kennedy has said he plans to go after food additives, and has also criticized ultra-processed foods. When Kennedy was sworn in as Secretary of Health and Human Services last week, President Donald Trump signed an executive order to establish a commission to "Make America Healthy Again," to investigate chronic illness and deliver an action plan to fight childhood diseases. MAHA is comparing U.S. food manufacturing to rivals in Europe, Van de Put said. Because Mondelez does business in both regions, it would be "relatively straightforward" for the Chicago-based company to adapt its recipes, he added. "It's work that needs to be done," said Van de Put. "It's cost that will come." Additional costs the company will face stemming from MAHA will ultimately trickle down to price hikes facing consumers at store shelves, Van de Put said. U.S. consumers are still reeling from once-in-a-generation levels of food inflation stemming from a supply chain crisis during the COVID-19 pandemic. Some ingredients, like eggs, cocoa and coffee, continue to rise in price dramatically, though for different reasons. It's not an easy time to raise prices, Van de Put said, "so I do expect it will take us a few years to work our way through this." He also said consumers will need to get used to chocolate that is 30% to 50% more expensive than it used to be "because that's what we're going to see" due to a supply crisis in Africa. Mondelez manufactures Cadbury and Milka chocolates. Sign in to access your portfolio
Reuters
18-02-2025
- Business
- Reuters
Mondelez CEO says Kennedy agenda product re-formulations will mean price hikes
ORLANDO, Feb 18 (Reuters) - Mondelez (MDLZ.O), opens new tab CEO Dirk van de Put on Tuesday said the Oreo maker will face new cost pressures from the Make America Healthy Again movement spearheaded by U.S. health secretary Robert F. Kennedy Jr and that Americans would see price hikes. Make America Healthy Again could require that Mondelez reformulate its U.S. products, which include Ritz crackers and Chips Ahoy cookies, Van de Put said at an industry conference. That would mean swapping out ingredients and food dyes it currently uses. Kennedy has said he plans to go after food additives, and has also criticized ultra-processed foods. When Kennedy was sworn in as Secretary of Health and Human Services last week, President Donald Trump signed an executive order to establish a commission to "Make America Healthy Again," to investigate chronic illness and deliver an action plan to fight childhood diseases. MAHA is comparing U.S. food manufacturing to rivals in Europe, Van de Put said. Because Mondelez does business in both regions, it would be "relatively straightforward" for the Chicago-based company to adapt its recipes, he added. "It's work that needs to be done," said Van de Put. "It's cost that will come." Additional costs the company will face stemming from MAHA will ultimately trickle down to price hikes facing consumers at store shelves, Van de Put said. U.S. consumers are still reeling from once-in-a-generation levels of food inflation stemming from a supply chain crisis during the COVID-19 pandemic. Some ingredients, like eggs, cocoa and coffee, continue to rise in price dramatically, though for different reasons. It's not an easy time to raise prices, Van de Put said, "so I do expect it will take us a few years to work our way through this." He also said consumers will need to get used to chocolate that is 30% to 50% more expensive than it used to be "because that's what we're going to see" due to a supply crisis in Africa. Mondelez manufactures Cadbury and Milka chocolates. Keep up with the latest medical breakthroughs and healthcare trends with the Reuters Health Rounds newsletter. Sign up here.
Chicago Tribune
05-02-2025
- Business
- Chicago Tribune
Oreo maker warns cocoa costs will drive down earnings per share 10%
Chicago-based Mondelez International Inc. shares slumped in after-hours trading after the snack food company said 'unprecedented cocoa cost inflation' would drive down earnings this year. The company expects adjusted earnings per share in 2025 to decline by approximately 10%. The stock fell 5% at 5:54 p.m. in after-hours trading in New York. Cocoa prices remain substantially elevated from prior years, more than doubling since the end of 2023. Chief Executive Officer Dirk Van de Put said the company was focused on navigating cocoa cost inflation in 2025. Sales in the company's fiscal fourth quarter ended Dec. 31 rose 3.1% to $9.6 billion, the maker of Triscuit crackers and Milka chocolate bars said in a statement Tuesday. Adjusted earnings per share fell 16% to $0.65. While Mondelez's revenues were up compared to 2023, volumes for the year were down, as budget-conscious shoppers pulled back on a wide range of purchases at the supermarket. While some food makers have used promotions to reel customers in, Mondelez has raised prices because of its reliance on cocoa. The company said that it expects cocoa prices to eventually come down from their current highs, but they will remain higher than they have historically. It is currently raising prices and may have to do more increases in the second half of the year and in 2026, Van de Put told investors Tuesday. Still, consumers maintain their appetite for chocolate — the company had double digit Christmas net revenue in the category. Chief Financial Officer Luca Zaramella said that the company would grow EPS in 2026 no matter what happens to cocoa prices. Mondelez International moved from Deerfield to Chicago's Fulton Market neighborhood in recent years, joining the parade of corporate food giants abandoning the suburbs for the city.
