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Mondelez International Drives Margin Expansion Through Supply Chain Redesign
As previously announced,
Driving Supply Chain Productivity Savings to Reinvest in Growth
"We're building an integrated supply chain organization that's laser-focused on delivering a demonstrable competitive advantage and generating savings we can reinvest in our growth," said
Myers detailed the company's journey to reinvent its complex supply chain, starting with upgrading leadership talent and capabilities. Leveraging experience from more than a dozen leading CPG companies, the team is transforming manufacturing processes and partnering with suppliers to develop more efficient, modular designs for global product platforms.
Based on these new designs, the company is installing Oreo manufacturing lines that require 30 percent less capital and reduce operating costs by
At the same time,
The company is also driving major productivity improvements through Lean Six Sigma, procurement transformation and simplification programs. Myers underscored several examples, including:
Finally, Myers highlighted the focus on improving cash management by addressing all the levers of the cash conversion cycle, including Days Sales Outstanding, inventory levels and suppliers' payment terms. In doing so, the company delivered a
"We're well-positioned for success," said
A live audio webcast of the presentation, including slides, is available on the company's web site at www.mondelezinternational.com/investor.
- Please see discussion of Non-GAAP Financial Measures at the end of this press release.
- Adjusted EPS guidance of $1.55-$1.60 is based on 2012 average currency rates and includes the estimated impact of the write-down of the net monetary assets and the translation of operating income for the company's Venezuelan business stemming from that government's decision to devalue its currency to a fixed rate of
6.30/$USon Feb.8, 2013.
This press release contains a number of forward-looking statements. The words "will," "expect," "plan," "drive," "improve," "deliver," "growth," "reaffirm," "outlook," "guidance" and similar expressions are intended to identify our forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements we make about our future performance, including future revenue growth, earnings per share and margins; the drivers of our future performance, including production, productivity and cash management improvements; our investments in emerging markets; and confidence in our future. These forward-looking statements involve risks and uncertainties, many of which are beyond our control, and important factors that could cause actual results to differ materially from those in our forward-looking statements include, but are not limited to, continued global economic weakness, increased competition, continued volatility of commodity and other input costs, business disruptions, pricing actions, risks from operating globally and tax law changes. For additional information on these and other factors that could affect our forward-looking statements, see our risk factors, as they may be amended from time to time, set forth in our filings with the
Non-GAAP Financial Measures
The company reports its financial results in accordance with accounting principles generally accepted in
Our non-GAAP financial measures and corresponding metrics reflect how we evaluate our operating results currently and provide improved comparability of operating results. As new events or circumstances arise, these definitions could change over time:
- "Organic Net Revenues" is defined as net revenues excluding the impacts of acquisitions, divestitures (including businesses under a sales agreement), Integration Program costs, accounting calendar changes and foreign currency rate fluctuations.
- "Adjusted EPS" (previously referred to as "Operating EPS") is defined as diluted EPS attributable to
Mondelez Internationalfrom continuing operations excluding the impact of Spin-Off Costs, pension costs related to the obligations transferred in the Spin-Off, the 2012-2014 Restructuring Program, the Integration Program and other acquisition integration costs, gains / losses from divestitures or acquisitions, acquisition-related costs and net earnings from divestitures (including businesses under sales agreements), and including an interest expense adjustment related to the Spin-Off transaction. We also evaluate growth in our Adjusted EPS on a constant currency basis.
We believe that the presentation of these non-GAAP financial measures, when considered together with our U.S. GAAP financial measures and the reconciliations to the corresponding U.S. GAAP financial measures, provides you with a more complete understanding of the factors and trends affecting our business than could be obtained absent these disclosures. In addition, the non-GAAP measures the company is using may differ from non-GAAP measures used by other companies. Because GAAP financial measures on a forward-looking basis are neither accessible nor deemed to be significantly different from the non-GAAP financial measures, and reconciling information is not available without unreasonable effort, the company has not provided that information with regard to the non-GAAP financial measures in the company's Outlook.
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