8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 13, 2018

 

 

MONDELĒZ INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Virginia   1-16483   52-2284372

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(I.R.S. Employer

Identification No.)

Three Parkway North, Deerfield, Illinois 60015

(Address of principal executive offices, including zip code)

(847) 943-4000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report.)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

 

 


Item 7.01. Regulation FD Disclosure.

Adoption of the New Accounting Standard for Net Periodic Benefit Cost Presentation

Mondelēz International, Inc. and subsidiaries (collectively, “we,” “our” or “Mondelēz International”) are furnishing this current report to provide supplemental financial information related to the retrospective impact of presenting net periodic benefit cost in accordance with revised guidance issued by the Financial Accounting Standards Board (“FASB”).

As previously disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, in March 2017, the FASB issued an Accounting Standards Update (“ASU”) to improve the presentation of net periodic pension and postretirement benefit costs. The standard requires employers to disaggregate the service cost component from the other components of net benefit cost and disclose the amount and location where the net benefit cost is recorded in the income statement or capitalized in assets. The standard is to be applied on a retrospective basis for the change in presentation in the income statement and prospectively for the change in presentation on the balance sheet. The ASU is effective for fiscal years beginning after December 15, 2017, with early adoption permitted. We adopted the standard on January 1, 2018.

As a result of this adoption, we have disaggregated the components of our net periodic pension and postretirement benefit costs and moved components other than service costs to a new line item, benefit plan non-service (income)/expense, located below operating income. Therefore, this change has resulted in revisions of our financial results for reported gross profit, operating income and segment operating income as well as for our non-GAAP financial results for Adjusted Gross Profit, Adjusted Operating Income and Adjusted Segment Operating income. The changes described above will have no impact on our previously reported consolidated net revenues, net earnings or earnings per share (“EPS”), nor on our non-GAAP financial results for Organic Net Revenue and Adjusted EPS, for any period. These changes also do not amend or modify any disclosure contained in, or reflect events occurring subsequent to the filing of, our Annual Report on Form 10-K for the fiscal year ended December 31, 2017. See the chart below and Exhibit 99.1 for the revised unaudited GAAP and non-GAAP financial information for all quarters of 2017 and 2016 and for the years ended December 31, 2017, 2016 and 2015.

Mondelēz International, Inc. and Subsidiaries

Revised Amounts Reflecting Reclassification of Benefit Plan Components

(in millions of U.S. dollars)

(Unaudited)

 

     2015     2016     2017     2016     2017  
     FY     FY     FY     Q1     Q2     Q3     Q4     Q1     Q2     Q3     Q4  

Revised (GAAP)

                      

Gross Profit

   $ 11,515     $ 10,104     $ 10,034     $ 2,530     $ 2,510     $ 2,479     $ 2,585     $ 2,518     $ 2,314     $ 2,549     $ 2,653  

Gross Profit Margin

     38.9     39.0     38.7     39.2     39.8     38.8     38.2     39.3     38.7     39.0     38.1

Operating Income

   $ 8,954     $ 2,554     $ 3,462     $ 714     $ 637     $ 698     $ 505     $ 825     $ 636     $ 1,171     $ 830  

Operating Income Margin

     30.2     9.9     13.4     11.1     10.1     10.9     7.5     12.9     10.6     17.9     11.9

Revised Adjusted (Non-GAAP)

                      

Gross Profit

   $ 10,241     $ 10,098     $ 10,177     $ 2,566     $ 2,462     $ 2,493     $ 2,577     $ 2,545     $ 2,340     $ 2,574     $ 2,718  

Gross Profit Margin

     39.2     40.0     39.7     40.7     40.0     40.0     39.2     40.5     39.8     39.5     39.1

Operating Income

   $ 3,350     $ 3,773     $ 4,119     $ 985     $ 902     $ 964     $ 922     $ 1,033     $ 906     $ 1,089     $ 1,091  

Operating Income Margin

     12.8     14.9     16.1     15.6     14.7     15.5     14.0     16.5     15.4     16.7     15.7

Non-GAAP Financial Measures

We use non-GAAP financial information and believe it is useful to investors as it provides additional information to facilitate comparisons of historical operating results, identify trends in our underlying operating results, and provide additional insight and transparency on how we evaluate our business. We use non-GAAP financial measures to budget, make operating and strategic decisions and evaluate our performance. We have detailed the non-GAAP adjustments that we make in our non-GAAP definitions below. The adjustments generally fall within the following categories: acquisition & divestiture activities, gains and losses on intangible asset sales and non-cash impairments, major program restructuring activities, constant currency and related adjustments, major program financing and hedging activities and other major items affecting comparability of operating results. We believe the non-GAAP measures should always be considered along with the related U.S. GAAP financial measures.

 

2


The definitions of our non-GAAP financial measures did not change as a result of the adoption of this ASU. For all periods presented in this Form 8-K, our non-GAAP financial measure Adjusted Operating Income is defined below and can also be found within our historically reported Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q for periods presented. We have also supplementally provided below the definitions of Adjusted Gross Profit and Adjusted Segment Operating Income on a comparable basis. As new events or circumstances arise, these definitions could change over time. When these definitions change, we provide the updated definitions and present the related non-GAAP historical results on a comparable basis (1).

Adjusted Gross Profit – defined as gross profit excluding the 2012-2014 Restructuring Program (5); the 2014-2018 Restructuring Program (5); acquisition integration costs; incremental costs associated with the Jacobs Douwe Egberts (“JDE”) coffee business transactions; the operating results of divestitures (2); the historical coffee business operating results (3); the historical Venezuelan operating results; mark-to-market impacts from commodity and forecasted currency transaction derivative contracts (6); and incremental expenses related to the malware incident. We also present “Adjusted Gross Profit margin,” which is subject to the same adjustments as Adjusted Gross Profit. We believe that Adjusted Gross Profit and Adjusted Gross Profit margin provide improved comparability of underlying operating results. We also evaluate growth in Adjusted Gross Profit on a constant currency basis (4).

Adjusted Operating Income and Adjusted Segment Operating Income – defined as operating income (or segment operating income) excluding the impacts of the 2012-2014 Restructuring Program (5); the 2014-2018 Restructuring Program (5); Venezuela remeasurement and deconsolidation losses and historical operating results; gains or losses (including non-cash impairment charges) on goodwill and intangible assets; divestiture (2) or acquisition gains or losses and related divestiture, acquisition and integration costs; the JDE coffee business transactions (3) gain and net incremental costs; the operating results of divestitures (2); our historical global coffee business operating results (3); mark-to-market impacts from commodity and forecasted currency transaction derivative contracts (6); equity method investment earnings historically reported within operating income (7); benefits from the resolution of tax matters (8); CEO transition remuneration (9); and incremental expenses related to the malware incident. We also present “Adjusted Operating Income margin” and “Adjusted Segment Operating Income margin,” which are subject to the same adjustments as Adjusted Operating Income and Adjusted Segment Operating Income. We believe that Adjusted Operating Income, Adjusted Segment Operating Income, Adjusted Operating Income margin and Adjusted Segment Operating Income margin provide improved comparability of underlying operating results. We also evaluate growth in Adjusted Operating Income and Adjusted Segment Operating Income on a constant currency basis (4).

 

  (1) When items no longer impact our current or future presentation of non-GAAP operating results, we remove these items from our non-GAAP definitions.

 

  (2) Divestitures include completed sales of businesses and exits of major product lines upon completion of a sale or licensing agreement.

 

  (3) We continue to have an ongoing interest in the legacy coffee business we deconsolidated in 2015 as part of the JDE coffee business transactions. For historical periods prior to the July 15, 2015 coffee business deconsolidation, we have reclassified any net revenue or operating income from the historical coffee business and included them where the coffee equity method investment earnings are presented within Adjusted EPS. As such, Organic Net Revenue, Adjusted Gross Profit and Adjusted Operating Income in all periods do not include the results of our legacy coffee businesses which are shown within Adjusted EPS only.

 

  (4) Constant currency operating results are calculated by dividing or multiplying, as appropriate, the current-period local currency operating results by the currency exchange rates used to translate the financial statements in the comparable prior-year period to determine what the current-period U.S. dollar operating results would have been if the currency exchange rate had not changed from the comparable prior-year period.

 

  (5) Non-GAAP adjustments related to the 2014-2018 Restructuring Program reflect costs incurred that relate to the objectives of our program to transform our supply chain network and organizational structure. Costs that do not meet the program objectives are not reflected in the non-GAAP adjustments. Refer to our Annual Report on Form 10-K for the year ended December 31, 2016 for more information on the 2012-2014 Restructuring Program.

 

  (6) During the third quarter of 2016, we began to exclude unrealized gains and losses (mark-to-market impacts) from outstanding commodity and forecasted currency transaction derivatives from our non-GAAP earnings measures until such time that the related exposures impact our operating results. Since we purchase commodity and forecasted currency contracts to mitigate price volatility primarily for inventory requirements in future periods, we made this adjustment to remove the volatility of these future inventory purchases on current operating results to facilitate comparisons of our underlying operating performance across periods. We also discontinued designating commodity and forecasted currency transaction derivatives for hedge accounting treatment. To facilitate comparisons of our underlying operating results, we have recast all historical non-GAAP earnings measures to exclude the mark-to-market impacts.

 

3


  (7) Historically, we have recorded income from equity method investments within our operating income as these investments operated as extensions of our base business. Beginning in the third quarter of 2015, we began to record the earnings from our equity method investments in after-tax equity method investment earnings outside of operating income following the deconsolidation of our coffee business. Refer to Note 1, Summary of Significant Accounting Policies, in our Annual Report on Form 10-K for the year ended December 31, 2016 for more information.

 

  (8) During 2017, we recorded benefits from the reversal of tax liabilities in connection with the resolution of a Brazilian indirect tax matter and settlement of pre-acquisition Cadbury tax matters. Refer to Note 12, Commitments and Contingencies—Tax Matters, in our Annual Report on Form 10-K for the year ended December 31, 2017 for more information.

 

  (9) On November 20, 2017, Dirk Van de Put succeeded Irene Rosenfeld as CEO of Mondelēz International in advance of her retirement at the end of March 2018. In order to incent Mr. Van de Put to join us, we provided him compensation with a total combined target value of $42.5 million to make him whole for incentive awards he forfeited or grants that were not made to him when he left his former employer. The compensation we granted took the form of cash, deferred stock units, performance share units and stock options. In connection with Irene Rosenfeld’s retirement, we made her outstanding grants of performance share units for the 2016-2018 and 2017-2019 performance cycles eligible for continued vesting and approved a $0.5 million salary for her service as Chairman from January through March 2018. We refer to these elements of Mr. Van de Put’s and Ms. Rosenfeld’s compensation arrangements together as “CEO transition remuneration.” We are excluding amounts we expense as CEO transition remuneration from our 2017 and future non-GAAP results because those amounts are not part of our regular compensation program and are incremental to amounts we would have incurred as ongoing CEO compensation. As a result, in 2017, we excluded amounts expensed for the cash payment to Mr. Van de Put and partial vesting of his equity grants. In 2018, we expect to exclude amounts paid for Ms. Rosenfeld’s service as Chairman and partial vesting of Mr. Van de Put’s and Ms. Rosenfeld’s equity grants.

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, helps provide a more complete understanding of the factors and trends affecting our business than could be obtained absent these disclosures. Because non-GAAP financial measures vary among companies, the non-GAAP financial measures presented in this report may not be comparable to similarly titled measures used by other companies. Our use of these non-GAAP financial measures is not meant to be considered in isolation or as a substitute for any U.S. GAAP financial measure. A limitation of the non-GAAP financial measures is they do not include all items of income and expense that affect us and have an impact on our U.S. GAAP reported results. The best way to address this limitation is by evaluating our non-GAAP financial measures in combination with our U.S. GAAP reported results and carefully evaluating the reconciliations of U.S. GAAP reported figures to the non-GAAP financial measures.

Financial Schedules

Exhibit 99.1 to this Form 8-K contains financial schedules that provide the reconciliations for our revised reported gross profit and operating income and our non-GAAP financial measures after the accounting change for net periodic pension cost and net periodic postretirement benefit cost for all quarters of 2017 and 2016 and for the years ended December 31, 2017, 2016 and 2015.

Item 9.01. Financial Statements and Exhibits.

(d) The following exhibit is being furnished with this Current Report on Form 8-K.

 

Exhibit Number

  

Description

99.1    Financial Schedules – Unaudited GAAP and Non-GAAP Financial Information.

 

4


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

MONDELĒZ INTERNATIONAL, INC.
By:   /s/ Brian T. Gladden
Name:   Brian T. Gladden
Title:   Executive Vice President and Chief Financial Officer

Date: April 13, 2018

 

5

EX-99.1

Exhibit 99.1

U.S. GAAP to Non-GAAP Reconciliations

In addition to reporting our U.S. GAAP operating results, we have historically reported non-GAAP financial information. Refer also to our Quarterly Reports on Form 10-Q and our Annual Report on Form 10-K for the periods presented for additional information on our GAAP to non-GAAP adjustments.

Schedule 1.1

Mondelēz International, Inc. and Subsidiaries

Revised Amounts Reflecting Reclassification of Benefit Plan Components

Reconciliation of GAAP to Non-GAAP Measures

Gross Profit / Operating Income

(in millions of U.S. dollars)

(Unaudited)

 

     For the Twelve Months Ended December 31, 2017  
     Net
Revenues
    Gross
Profit
    Gross
Profit
Margin
    Operating
Income
    Operating
Income
Margin
 

Reported (GAAP)

   $ 25,896     $ 10,065       38.9   $ 3,506       13.5

Reclassification of benefit plan components

     —         (31       (44  
  

 

 

   

 

 

     

 

 

   

Revised (GAAP)

   $ 25,896     $ 10,034       38.7   $ 3,462       13.4

2014-2018 Restructuring Program costs

     —         61         777    

Acquisition integration costs

     —         —           3    

Intangible asset impairment charges

     —         —           109    

Benefits from resolution of tax matters

     —         —           (209  

Malware incident incremental expenses

     —         62         84    

CEO transition remuneration

     —         —           14    

Operating income from divestitures

     (270     (79       (61  

Divestiture-related costs

     —         2         31    

Net gain on divestitures

     —         —           (186  

Mark-to-market (gains)/losses from derivatives

     —         96         96    

Rounding

     —         1         (1  
  

 

 

   

 

 

     

 

 

   

Revised Adjusted (Non-GAAP)

   $ 25,626     $ 10,177       39.7   $ 4,119       16.1
  

 

 

         

Currency

       (40       (3  
    

 

 

     

 

 

   

Revised Adjusted @ Constant FX (Non-GAAP)

     $ 10,137       $ 4,116    
    

 

 

     

 

 

   

 

     For the Twelve Months Ended December 31, 2016  
     Net
Revenues
    Gross
Profit
    Gross
Profit
Margin
    Operating
Income
    Operating
Income
Margin
 

Reported (GAAP)

   $ 25,923     $ 10,128       39.1   $ 2,569       9.9

Reclassification of benefit plan components

     —         (24       (15  
  

 

 

   

 

 

     

 

 

   

Revised (GAAP)

   $ 25,923     $ 10,104       39.0   $ 2,554       9.9

2014-2018 Restructuring Program costs

     —         91         1,072    

Acquisition integration costs

     —         —           7    

Gain on sale of intangible asset

     —         —           (15  

Intangible asset impairment charges

     —         —           137    

(Income)/costs associated with the JDE coffee business transactions

     —         —           (2  

Operating income from divestitures

     (653     (198       (153  

Divestiture-related costs

     —         8         86    

Gain on divestiture

     —         —           (9  

Acquisition-related costs

     —         —           1    

Mark-to-market (gains)/losses from derivatives

     —         94         94    

Rounding

     —         (1       1    
  

 

 

   

 

 

     

 

 

   

Revised Adjusted (Non-GAAP)

   $ 25,270     $ 10,098       40.0   $ 3,773       14.9
  

 

 

   

 

 

     

 

 

   
           Gross
Profit
          Operating
Income
       

% Change - Revised (GAAP)

       (0.7 )%        35.6  

% Change - Revised Adjusted (Non-GAAP)

       0.8       9.2  

% Change - Revised Adjusted @ Constant FX (Non-GAAP)

       0.4       9.1  


Schedule 1.2

Mondelēz International, Inc. and Subsidiaries

Revised Amounts Reflecting Reclassification of Benefit Plan Components

Reconciliation of GAAP to Non-GAAP Measures

Gross Profit / Operating Income

(in millions of U.S. dollars)

(Unaudited)

 

     For the Three Months Ended December 31, 2017  
     Net
Revenues
    Gross
Profit
    Gross
Profit
Margin
    Operating
Income
    Operating
Income
Margin
 

Reported (GAAP)

   $ 6,966     $ 2,664       38.2   $ 844       12.1

Reclassification of benefit plan components

     —         (11       (14  
  

 

 

   

 

 

     

 

 

   

Revised (GAAP)

   $ 6,966     $ 2,653       38.1   $ 830       11.9

2014-2018 Restructuring Program costs

     —         22         192    

Acquisition integration costs

     —         —           1    

Benefits from resolution of tax matters

     —         —           (8  

Malware incident incremental expenses

     —         20         30    

CEO transition remuneration

     —         —           14    

Operating income from divestitures

     (6     (3       (1  

Divestiture-related costs

     —         (1       9    

Gain on divestiture

     —         —           (2  

Mark-to-market (gains)/losses from derivatives

     —         27         27    

Rounding

     —         —           (1  
  

 

 

   

 

 

     

 

 

   

Revised Adjusted (Non-GAAP)

   $ 6,960     $ 2,718       39.1   $ 1,091       15.7
  

 

 

         

Currency

       (88       (50  
    

 

 

     

 

 

   

Revised Adjusted @ Constant FX (Non-GAAP)

     $ 2,630       $ 1,041    
    

 

 

     

 

 

   

 

     For the Three Months Ended December 31, 2016  
     Net
Revenues
    Gross
Profit
    Gross
Profit
Margin
    Operating
Income
    Operating
Income
Margin
 

Reported (GAAP)

   $ 6,770     $ 2,589       38.2   $ 507       7.5

Reclassification of benefit plan components

     —         (4       (2  
  

 

 

   

 

 

     

 

 

   

Revised (GAAP)

   $ 6,770     $ 2,585       38.2   $ 505       7.5

2014-2018 Restructuring Program costs

     —         8         319    

Acquisition integration costs

     —         —           1    

Gain on sale of intangible asset

     —         —           (2  

Intangible asset impairment charges

     —         —           107    

Operating income from divestitures

     (192     (60       (48  

Divestiture-related costs

     —         —           2    

Gain on divestiture

     —         —           (9  

Acquisition-related costs

     —         —           1    

Mark-to-market (gains)/losses from derivatives

     —         45         45    

Rounding

     —         (1       1    
  

 

 

   

 

 

     

 

 

   

Revised Adjusted (Non-GAAP)

   $ 6,578     $ 2,577       39.2   $ 922       14.0
  

 

 

   

 

 

     

 

 

   
           Gross
Profit
          Operating
Income
       

% Change - Revised (GAAP)

       2.6       64.4  

% Change - Revised Adjusted (Non-GAAP)

       5.5       18.3  

% Change - Revised Adjusted @ Constant FX (Non-GAAP)

       2.1       12.9  


Schedule 1.3

Mondelēz International, Inc. and Subsidiaries

Revised Amounts Reflecting Reclassification of Benefit Plan Components

Reconciliation of GAAP to Non-GAAP Measures

Gross Profit / Operating Income

(in millions of U.S. dollars)

(Unaudited)

 

     For the Three Months Ended September 30, 2017  
     Net
Revenues
    Gross
Profit
    Gross
Profit
Margin
    Operating
Income
    Operating
Income
Margin
 

Reported (GAAP)

   $ 6,530     $ 2,552       39.1   $ 1,181       18.1

Reclassification of benefit plan components

     —         (3       (10  
  

 

 

   

 

 

     

 

 

   

Revised (GAAP)

   $ 6,530     $ 2,549       39.0   $ 1,171       17.9

2014-2018 Restructuring Program costs

     —         18         175    

Acquisition integration costs

     —         —           1    

Intangible asset impairment charges

     —         —           71    

Benefits from resolution of tax matters

     —         —           (155  

Malware incident incremental expenses

     —         39         47    

Operating income from divestitures

     (18     (4       (5  

Gain on divestiture

     —         —           (187  

Mark-to-market (gains)/losses from derivatives

     —         (28       (28  

Rounding

     —         —           (1  
  

 

 

   

 

 

     

 

 

   

Revised Adjusted (Non-GAAP)

   $ 6,512     $ 2,574       39.5   $ 1,089       16.7
  

 

 

         

Currency

       (34       (22  
    

 

 

     

 

 

   

Revised Adjusted @ Constant FX (Non-GAAP)

     $ 2,540       $ 1,067    
    

 

 

     

 

 

   

 

     For the Three Months Ended September 30, 2016  
     Net
Revenues
    Gross
Profit
    Gross
Profit
Margin
    Operating
Income
    Operating
Income
Margin
 

Reported (GAAP)

   $ 6,396     $ 2,488       38.9   $ 702       11.0

Reclassification of benefit plan components

     —         (9       (4  
  

 

 

   

 

 

     

 

 

   

Revised (GAAP)

   $ 6,396     $ 2,479       38.8   $ 698       10.9

2014-2018 Restructuring Program costs

     —         50         297    

Gain on sale of intangible asset

     —         —           (7  

Intangible asset impairment charges

     —         —           4    

(Income)/costs associated with the JDE coffee business transactions

     —         —           (2  

Operating income from divestitures

     (161     (48       (39  

Mark-to-market (gains)/losses from derivatives

     —         12         12    

Rounding

     —         —           1    
  

 

 

   

 

 

     

 

 

   

Revised Adjusted (Non-GAAP)

   $ 6,235     $ 2,493       40.0   $ 964       15.5
  

 

 

   

 

 

     

 

 

   
           Gross
Profit
          Operating
Income
       

% Change - Revised (GAAP)

       2.8       67.8  

% Change - Revised Adjusted (Non-GAAP)

       3.2       13.0  

% Change - Revised Adjusted @ Constant FX (Non-GAAP)

       1.9       10.7  


Schedule 1.4

Mondelēz International, Inc. and Subsidiaries

Revised Amounts Reflecting Reclassification of Benefit Plan Components

Reconciliation of GAAP to Non-GAAP Measures

Gross Profit / Operating Income

(in millions of U.S. dollars)

(Unaudited)

 

     For the Three Months Ended June 30, 2017  
     Net
Revenues
    Gross
Profit
    Gross
Profit
Margin
    Operating
Income
    Operating
Income
Margin
 

Reported (GAAP)

   $ 5,986     $ 2,324       38.8   $ 641       10.7

Reclassification of benefit plan components

     —         (10       (5  
  

 

 

   

 

 

     

 

 

   

Revised (GAAP)

   $ 5,986     $ 2,314       38.7   $ 636       10.6

2014-2018 Restructuring Program costs

     —         12         199    

Intangible asset impairment charges

     —         —           38    

Malware incident incremental expenses

     —         4         7    

Operating income from divestitures

     (110     (37       (28  

Divestiture-related costs

     —         —           4    

Loss on divestiture

     —         —           3    

Mark-to-market (gains)/losses from derivatives

     —         46         46    

Rounding

     —         1         1    
  

 

 

   

 

 

     

 

 

   

Revised Adjusted (Non-GAAP)

   $ 5,876     $ 2,340       39.8   $ 906       15.4
  

 

 

         

Currency

       48         61    
    

 

 

     

 

 

   

Revised Adjusted @ Constant FX (Non-GAAP)

     $ 2,388       $ 967    
    

 

 

     

 

 

   

 

     For the Three Months Ended June 30, 2016  
     Net
Revenues
    Gross
Profit
    Gross
Profit
Margin
    Operating
Income
    Operating
Income
Margin
 

Reported (GAAP)

   $ 6,302     $ 2,516       39.9   $ 638       10.1

Reclassification of benefit plan components

     —         (6       (1  
  

 

 

   

 

 

     

 

 

   

Revised (GAAP)

   $ 6,302     $ 2,510       39.8   $ 637       10.1

2014-2018 Restructuring Program costs

     —         6         219    

Acquisition integration costs

     —         —           3    

Gain on sale of intangible asset

     —         —           (6  

Intangible asset impairment charges

     —         —           12    

(Income)/costs associated with the JDE coffee business transactions

     —         —           1    

Operating income from divestitures

     (153     (45       (31  

Divestiture-related costs

     —         8         84    

Mark-to-market (gains)/losses from derivatives

     —         (17       (17  
  

 

 

   

 

 

     

 

 

   

Revised Adjusted (Non-GAAP)

   $ 6,149     $ 2,462       40.0   $ 902       14.7
  

 

 

   

 

 

     

 

 

   
           Gross
Profit
          Operating
Income
       

% Change - Revised (GAAP)

       (7.8 )%        (0.2 )%   

% Change - Revised Adjusted (Non-GAAP)

       (5.0 )%        0.4  

% Change - Revised Adjusted @ Constant FX (Non-GAAP)

       (3.0 )%        7.2  


Schedule 1.5

Mondelēz International, Inc. and Subsidiaries

Revised Amounts Reflecting Reclassification of Benefit Plan Components

Reconciliation of GAAP to Non-GAAP Measures

Gross Profit / Operating Income

(in millions of U.S. dollars)

(Unaudited)

 

     For the Three Months Ended March 31, 2017  
     Net
Revenues
    Gross
Profit
    Gross
Profit
Margin
    Operating
Income
    Operating
Income
Margin
 

Reported (GAAP)

   $ 6,414     $ 2,525       39.4   $ 840       13.1

Reclassification of benefit plan components

     —         (7       (15  
  

 

 

   

 

 

     

 

 

   

Revised (GAAP)

   $ 6,414     $ 2,518       39.3   $ 825       12.9

2014-2018 Restructuring Program costs

     —         9         211    

Acquisition integration costs

     —         —           1    

Benefits from resolution of tax matters

     —         —           (46  

Operating income from divestitures

     (136     (35       (27  

Divestiture-related costs

     —         2         19    

Mark-to-market (gains)/losses from derivatives

     —         51         51    

Rounding

     —         —           (1  
  

 

 

   

 

 

     

 

 

   

Revised Adjusted (Non-GAAP)

   $ 6,278     $ 2,545       40.5   $ 1,033       16.5
  

 

 

         

Currency

       34         8    
    

 

 

     

 

 

   

Revised Adjusted @ Constant FX (Non-GAAP)

     $ 2,579       $ 1,041    
    

 

 

     

 

 

   

 

     For the Three Months Ended March 31, 2016  
     Net
Revenues
    Gross
Profit
    Gross
Profit
Margin
    Operating
Income
    Operating
Income
Margin
 

Reported (GAAP)

   $ 6,455     $ 2,535       39.3   $ 722       11.2

Reclassification of benefit plan components

     —         (5       (8  
  

 

 

   

 

 

     

 

 

   

Revised (GAAP)

   $ 6,455     $ 2,530       39.2   $ 714       11.1

2014-2018 Restructuring Program costs

     —         27         237    

Acquisition integration costs

     —         —           3    

Intangible asset impairment charges

     —         —           14    

(Income)/costs associated with the JDE coffee business transactions

     —         —           (1  

Operating income from divestitures

     (147     (45       (35  

Mark-to-market (gains)/losses from derivatives

     —         54         54    

Rounding

     —         —           (1  
  

 

 

   

 

 

     

 

 

   

Revised Adjusted (Non-GAAP)

   $ 6,308     $ 2,566       40.7   $ 985       15.6
  

 

 

   

 

 

     

 

 

   
           Gross
Profit
          Operating
Income
       

% Change - Revised (GAAP)

       (0.5 )%        15.5  

% Change - Revised Adjusted (Non-GAAP)

       (0.8 )%        4.9  

% Change - Revised Adjusted @ Constant FX (Non-GAAP)

       0.5       5.7  


Schedule 1.6

Mondelēz International, Inc. and Subsidiaries

Revised Amounts Reflecting Reclassification of Benefit Plan Components

Reconciliation of GAAP to Non-GAAP Measures

Gross Profit / Operating Income

(in millions of U.S. dollars)

(Unaudited)

 

     For the Twelve Months Ended December 31, 2016  
     Net
Revenues
    Gross
Profit
    Gross
Profit
Margin
    Operating
Income
    Operating
Income
Margin
 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Reported (GAAP)

   $ 25,923     $ 10,128       39.1   $ 2,569       9.9

Reclassification of benefit plan components

     —         (24       (15  
  

 

 

   

 

 

     

 

 

   

Revised (GAAP)

   $ 25,923     $ 10,104       39.0   $ 2,554       9.9

2014-2018 Restructuring Program costs

     —         91         1,072    

Acquisition integration costs

     —         —           7    

Gain on sale of intangible asset

     —         —           (15  

Intangible asset impairment charges

     —         —           137    

(Income)/costs associated with the JDE coffee business transactions

     —         —           (2  

Operating income from divestitures

     (653     (198       (153  

Divestiture-related costs

     —         8         86    

Gain on divestiture

     —         —           (9  

Acquisition-related costs

     —         —           1    

Mark-to-market (gains)/losses from derivatives

     —         94         94    

Rounding

     —         (1       1    
  

 

 

   

 

 

     

 

 

   

Revised Adjusted (Non-GAAP)

   $ 25,270     $ 10,098       40.0   $ 3,773       14.9
  

 

 

         

Currency

       412         160    
    

 

 

     

 

 

   

Revised Adjusted @ Constant FX (Non-GAAP)

     $ 10,510       $ 3,933    
    

 

 

     

 

 

   

 

     For the Twelve Months Ended December 31, 2015  
     Net
Revenues
    Gross
Profit
    Gross
Profit
Margin
    Operating
Income
    Operating
Income
Margin
 

Reported (GAAP)

   $ 29,636     $ 11,512       38.8   $ 8,897       30.0

Reclassification of benefit plan components

     —         3         57    
  

 

 

   

 

 

     

 

 

   

Revised (GAAP)

   $ 29,636     $ 11,515       38.9   $ 8,954       30.2

2012-2014 Restructuring Program costs

     —         (1       (4  

2014-2018 Restructuring Program costs

     —         42         994    

Acquisition integration costs

     —         1         9    

Remeasurement of net monetary assets in Venezuela

     —         —           11    

Loss on deconsolidation of Venezuela

     —         —           778    

Intangible asset impairment charges

     —         —           71    

(Income)/costs associated with the JDE coffee business transactions

     —         4         278    

Operating income from divestitures

     (695     (226       (182  

Historical Venezuelan operations

     (1,217     (354       (281  

Historical coffee business

     (1,627     (684       (357  

Gain on the JDE coffee business transactions

     —         —           (6,809  

Gain on divestiture

     —         —           (13  

Acquisition-related costs

     —         —           8    

Reclassification of equity method investment earnings

     —         —           (51  

Mark-to-market (gains)/losses from derivatives

     —         (56       (56  
  

 

 

   

 

 

     

 

 

   

Revised Adjusted (Non-GAAP)

   $ 26,097     $ 10,241       39.2   $ 3,350       12.8
  

 

 

   

 

 

     

 

 

   
           Gross
Profit
          Operating
Income
       

% Change - Revised (GAAP)

       (12.3 )%        (71.5 )%   

% Change - Revised Adjusted (Non-GAAP)

       (1.4 )%        12.6  

% Change - Revised Adjusted @ Constant FX (Non-GAAP)

       2.6       17.4  


Schedule 2.1

Mondelēz International, Inc. and Subsidiaries

Revised Amounts Reflecting Reclassification of Benefit Plan Components

Reconciliation of GAAP to Non-GAAP Measures

Segment Data

(in millions of U.S. dollars)

(Unaudited)

 

    For the Twelve Months Ended December 31, 2017  
    Latin
America
    AMEA     Europe     North
America
    Unrealized
G/(L) on
Hedging
Activities
    General
Corporate
Expenses
    Amortization
of Intangibles
    Other
Items
    Mondelēz
International
 

Net Revenue

                 

Reported (GAAP)

  $ 3,566     $ 5,739     $ 9,794     $ 6,797     $ —       $ —       $ —       $ —       $ 25,896  

Divestitures

    —         (133     (137     —         —         —         —         —         (270
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted (Non-GAAP)

  $ 3,566     $ 5,606     $ 9,657     $ 6,797     $ —       $ —       $ —       $ —       $ 25,626  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

                 

Reported (GAAP)

  $ 565     $ 516     $ 1,680     $ 1,120     $ (96   $ (287   $ (178   $ 186     $ 3,506  

Reclassification of benefit plan components

    (1     (2     (70     24       —         5       —         —         (44
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised (GAAP)

  $ 564     $ 514     $ 1,610     $ 1,144     $ (96   $ (282   $ (178   $ 186     $ 3,462  

2014-2018 Restructuring Program costs

    136       183       263       142       —         53       —         —         777  

Acquisition integration costs

    —         3       —         —         —         —         —         —         3  

Intangible asset impairment charges

    5       52       11       41       —         —         —         —         109  

Benefits from resolution of tax matters

    (153     —         (49     (7     —         —         —         —         (209

Malware incident incremental expenses

    1       2       15       61       —         5       —         —         84  

CEO transition remuneration

    —         —         —         —         —         14       —         —         14  

Operating income from divestitures

    —         (27     (34     —         —         —         —         —         (61

Divestiture-related costs

    —         3       21       —         —         7       —         —         31  

Net gain on divestitures

    —         —         —         —         —         —         —         (186     (186

Mark-to-market (gains)/losses from derivatives

    —         —         —         —         96       —         —         —         96  

Rounding

    —         —         —         —         —         (1     —         —         (1
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted (Non-GAAP)

  $ 553     $ 730     $ 1,837     $ 1,381     $ —       $ (204   $ (178   $ —       $ 4,119  

Currency

    (20     44       (22     (4     —         (2     1       —         (3
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted @ Constant FX (Non-GAAP)

  $ 533     $ 774     $ 1,815     $ 1,377     $ —       $ (206   $ (177   $ —       $ 4,116  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

% Change - Revised (GAAP)

    107.4     1.8     34.4     1.4     n/m       1.7     (1.1 )%      n/m       35.6

% Change - Revised Adjusted (Non-GAAP)

    26.5     12.8     12.6     (4.5 )%      n/m       4.2     (1.1 )%      n/m       9.2

% Change - Revised Adjusted @ Constant FX (Non-GAAP)

    22.0     19.6     11.2     (4.8 )%      n/m       3.3     (0.6 )%      n/m       9.1

Operating Income Margin

                 

Revised %

    15.8     9.0     16.4     16.8             13.4

Revised pp change - year over year

    7.8 pp      0.3 pp      4.1 pp      0.6 pp              3.5 pp 

Revised Adjusted %

    15.5     13.0     19.0     20.3             16.1

Revised Adjusted pp change - year over year

    2.6 pp      1.4 pp      1.6 pp      (0.5 )pp              1.2 pp 

 

    For the Twelve Months Ended December 31, 2016  
    Latin
America
    AMEA     Europe     North
America
    Unrealized
G/(L) on
Hedging
Activities
    General
Corporate
Expenses
    Amortization
of Intangibles
    Other
Items
    Mondelēz
International
 

Net Revenue

                 

Reported (GAAP)

  $ 3,392     $ 5,816     $ 9,755     $ 6,960     $ —       $ —       $ —       $ —       $ 25,923  

Divestitures

    (8     (261     (371     (13     —         —         —         —         (653
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted (Non-GAAP)

  $ 3,384     $ 5,555     $ 9,384     $ 6,947     $ —       $ —       $ —       $ —       $ 25,270  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

                 

Reported (GAAP)

  $ 271     $ 506     $ 1,267     $ 1,078     $ (94   $ (291   $ (176   $ 8     $ 2,569  

Reclassification of benefit plan components

    1       (1     (69     50       —         4       —         —         (15
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised (GAAP)

  $ 272     $ 505     $ 1,198     $ 1,128     $ (94   $ (287   $ (176   $ 8     $ 2,554  

2014-2018 Restructuring Program costs

    165       144       398       294       —         71       —         —         1,072  

Acquisition integration costs

    —         7       —         —         —         —         —         —         7  

Gain on sale of intangible asset

    —         —         (8     (7     —         —         —         —         (15

Intangible asset impairment charges

    2       45       50       39       —         1       —         —         137  

(Income)/costs associated with the JDE coffee business transactions

    —         —         (3     —         —         1       —         —         (2

Operating income from divestitures

    (2     (54     (89     (8     —         —         —         —         (153

Divestiture-related costs

    —         —         86       —         —         —         —         —         86  

Gain on divestiture

    —         —         —         —         —         —         —         (9     (9

Acquisition-related costs

    —         —         —         —         —         —         —         1       1  

Mark-to-market (gains)/losses from derivatives

    —         —         —         —         94       —         —         —         94  

Rounding

    —         —         —         —         —         1       —         —         1  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted (Non-GAAP)

  $ 437     $ 647     $ 1,632     $ 1,446     $ —       $ (213   $ (176   $ —       $ 3,773  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income Margin

                 

Revised %

    8.0     8.7     12.3     16.2             9.9

Revised Adjusted %

    12.9     11.6     17.4     20.8             14.9


Schedule 2.2

Mondelēz International, Inc. and Subsidiaries

Revised Amounts Reflecting Reclassification of Benefit Plan Components

Reconciliation of GAAP to Non-GAAP Measures

Segment Data

(in millions of U.S. dollars)

(Unaudited)

 

    For the Three Months Ended December 31, 2017  
    Latin
America
    AMEA     Europe     North
America
    Unrealized
G/(L) on
Hedging
Activities
    General
Corporate
Expenses
    Amortization
of Intangibles
    Other
Items
    Mondelēz
International
 

Net Revenue

                 

Reported (GAAP)

  $ 900     $ 1,449     $ 2,816     $ 1,801     $ —       $ —       $ —       $ —       $ 6,966  

Divestitures

    —         (4     (2     —         —         —         —         —         (6
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted (Non-GAAP)

  $ 900     $ 1,445     $ 2,814     $ 1,801     $ —       $ —       $ —       $ —       $ 6,960  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

                 

Reported (GAAP)

  $ 96     $ 91     $ 522     $ 296     $ (27   $ (91   $ (45   $ 2     $ 844  

Reclassification of benefit plan components

    (1     (1     (19     6       —         1       —         —         (14
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised (GAAP)

  $ 95     $ 90     $ 503     $ 302     $ (27   $ (90   $ (45   $ 2     $ 830  

2014-2018 Restructuring Program costs

    32       47       65       33       —         15       —         —         192  

Acquisition integration costs

    —         1       —         —         —         —         —         —         1  

Benefits from resolution of tax matters

    —         —         (1     (7     —         —         —         —         (8

Malware incident incremental expenses

    —         —         4       23       —         3       —         —         30  

CEO transition remuneration

    —         —         —         —         —         14       —         —         14  

Operating income from divestitures

    —         —         (1     —         —         —         —         —         (1

Divestiture-related costs

    —         (2     2       —         —         9       —         —         9  

Gain on divestiture

    —         —         —         —         —         —         —         (2     (2

Mark-to-market (gains)/losses from derivatives

    —         —         —         —         27       —         —         —         27  

Rounding

    —         —         —         —         —         (1     —         —         (1
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted (Non-GAAP)

  $ 127     $ 136     $ 572     $ 351     $ —       $ (50   $ (45   $ —       $ 1,091  

Currency

    2       —         (50     (3     —         —         1       —         (50
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted @ Constant FX (Non-GAAP)

  $ 129     $ 136     $ 522     $ 348     $     $ (50   $ (44   $     $ 1,041  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

% Change - Revised (GAAP)

    17.3     4400.0     53.4     20.3     n/m       (18.4 )%      (2.3 )%      n/m       64.4

% Change - Revised Adjusted (Non-GAAP)

    (11.2 )%      67.9     25.4     4.8     n/m       (2.0 )%      (2.3 )%      n/m       18.3

% Change - Revised Adjusted @ Constant FX (Non-GAAP)

    (9.8 )%      67.9     14.5     3.9     n/m       (2.0 )%      0.0     n/m       12.9

Operating Income Margin

                 

Revised %

    10.6     6.2     17.9     16.8             11.9

Revised pp change - year over year

    1.2 pp      6.1 pp      5.7 pp      2.9 pp              4.4 pp 

Revised Adjusted %

    14.1     9.4     20.3     19.5             15.7

Revised Adjusted pp change - year over year

    (2.5 )pp      3.4 pp      2.5 pp      0.9 pp              1.7 pp 

 

    For the Three Months Ended December 31, 2016  
    Latin
America
    AMEA     Europe     North
America
    Unrealized
G/(L) on
Hedging
Activities
    General
Corporate
Expenses
    Amortization
of Intangibles
    Other
Items
    Mondelēz
International
 

Net Revenue

                 

Reported (GAAP)

  $ 864     $ 1,412     $ 2,682     $ 1,812     $ —       $ —       $ —       $ —       $ 6,770  

Divestitures

    (2     (68     (114     (8     —         —         —         —         (192
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted (Non-GAAP)

  $ 862     $ 1,344     $ 2,568     $ 1,804     $ —       $ —       $ —       $ —       $ 6,578  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

                 

Reported (GAAP)

  $ 80     $ 2     $ 343     $ 238     $ (45   $ (75   $ (44   $ 8     $ 507  

Reclassification of benefit plan components

    1       —         (15     13       —         (1     —         —         (2
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised (GAAP)

  $ 81     $ 2     $ 328     $ 251     $ (45   $ (76   $ (44   $ 8     $ 505  

2014-2018 Restructuring Program costs

    60       45       132       57       —         25       —         —         319  

Acquisition integration costs

    —         1       —         —         —         —         —         —         1  

Gain on sale of intangible asset

    —         —         (2     —         —         —         —         —         (2

Intangible asset impairment charges

    2       45       27       32       —         1       —         —         107  

Operating income from divestitures

    —         (12     (31     (5     —         —         —         —         (48

Divestiture-related costs

    —         —         2       —         —         —         —         —         2  

Gain on divestiture

    —         —         —         —         —         —         —         (9     (9

Acquisition-related costs

    —         —         —         —         —         —         —         1       1  

Mark-to-market (gains)/losses from derivatives

    —         —         —         —         45       —         —         —         45  

Rounding

    —         —         —         —         —         1       —         —         1  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted (Non-GAAP)

  $ 143     $ 81     $ 456     $ 335     $ —       $ (49   $ (44   $ —       $ 922  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income Margin

                 

Revised %

    9.4     0.1     12.2     13.9             7.5

Revised Adjusted %

    16.6     6.0     17.8     18.6             14.0


Schedule 2.3

Mondelēz International, Inc. and Subsidiaries

Revised Amounts Reflecting Reclassification of Benefit Plan Components

Reconciliation of GAAP to Non-GAAP Measures

Segment Data

(in millions of U.S. dollars)

(Unaudited)

 

    For the Three Months Ended September 30, 2017  
    Latin
America
    AMEA     Europe     North
America
    Unrealized
G/(L) on
Hedging
Activities
    General
Corporate
Expenses
    Amortization
of Intangibles
    Other
Items
    Mondelēz
International
 

Net Revenue

                 

Reported (GAAP)

  $ 908     $ 1,405     $ 2,442     $ 1,775     $ —       $ —       $ —       $ —       $ 6,530  

Divestitures

    —         (4     (14     —         —         —         —         —         (18
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted (Non-GAAP)

  $ 908     $ 1,401     $ 2,428     $ 1,775     $ —       $ —       $ —       $ —       $ 6,512  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

                 

Reported (GAAP)

  $ 255     $ 82     $ 410     $ 318     $ 28     $ (54   $ (45   $ 187     $ 1,181  

Reclassification of benefit plan components

    1       —         (17     7       —         (1     —         —         (10
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised (GAAP)

  $ 256     $ 82     $ 393     $ 325     $ 28     $ (55   $ (45   $ 187     $ 1,171  

2014-2018 Restructuring Program costs

    53       43       48       19       —         12       —         —         175  

Acquisition integration costs

    —         1       —         —         —         —         —         —         1  

Intangible asset impairment charges

    5       53       11       3       —         (1     —         —         71  

Benefits from resolution of tax matters

    (153     —         (2     —         —         —         —         —         (155

Malware incident incremental expenses

    1       2       9       34       —         1       —         —         47  

Operating income from divestitures

    —         (1     (4     —         —         —         —         —         (5

Divestiture-related costs

    —         2       (2     —         —         —         —         —         —    

Gain on divestiture

    —         —         —         —         —         —         —         (187     (187

Mark-to-market (gains)/losses from derivatives

    —         —         —         —         (28     —         —         —         (28

Rounding

    —         —         —         —         —         (1     —         —         (1
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted (Non-GAAP)

  $ 162     $ 182     $ 453     $ 381     $ —       $ (44   $ (45   $ —       $ 1,089  

Currency

    (2     2       (21     (2     —         —         1       —         (22
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted @ Constant FX (Non-GAAP)

  $ 160     $ 184     $ 432     $ 379     $ —       $ (44   $ (44   $ —       $ 1,067  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

% Change - Revised (GAAP)

    178.3     (50.0 )%      31.9     13.2     n/m       36.8     (2.3 )%      n/m       67.8

% Change - Revised Adjusted (Non-GAAP)

    21.8     9.6     13.0     0.3     n/m       38.9     (2.3 )%      n/m       13.0

% Change - Revised Adjusted @ Constant FX (Non-GAAP)

    20.3     10.8     7.7     (0.3 )%      n/m       38.9     0.0     n/m       10.7

Operating Income Margin

                 

Revised %

    28.2     5.8     16.1     18.3             17.9

Revised pp change - year over year

    17.6 pp      (5.6 )pp      3.3 pp      1.9 pp              7.0 pp 

Revised Adjusted %

    17.8     13.0     18.7     21.5             16.7

Revised Adjusted pp change - year over year

    2.4 pp      1.0 pp      0.8 pp      (0.2 )pp              1.2 pp 

 

    For the Three Months Ended September 30, 2016  
    Latin
America
    AMEA     Europe     North
America
    Unrealized
G/(L) on
Hedging
Activities
    General
Corporate
Expenses
    Amortization
of Intangibles
    Other
Items
    Mondelēz
International
 

Net Revenue

                 

Reported (GAAP)

  $ 868     $ 1,443     $ 2,332     $ 1,753     $ —       $ —       $ —       $ —       $ 6,396  

Divestitures

    (2     (65     (89     (5     —         —         —         —         (161
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted (Non-GAAP)

  $ 866     $ 1,378     $ 2,243     $ 1,748     $ —       $ —       $ —       $ —       $ 6,235  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

                 

Reported (GAAP)

  $ 92     $ 165     $ 316     $ 274     $ (12   $ (89   $ (44   $ —       $ 702  

Reclassification of benefit plan components

    —         (1     (18     13       —         2       —         —         (4
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised (GAAP)

  $ 92     $ 164     $ 298     $ 287     $ (12   $ (87   $ (44   $ —       $ 698  

2014-2018 Restructuring Program costs

    42       18       121       103       —         13       —         —         297  

Acquisition integration costs

    —         (1     —         —         —         1       —         —         —    

Gain on sale of intangible asset

    —         —         —         (7     —         —         —         —         (7

Intangible asset impairment charges

    —         —         4       —         —         —         —         —         4  

(Income)/costs associated with the JDE coffee business transactions

    —         —         (3     —         —         1       —         —         (2

Operating income from divestitures

    (1     (15     (19     (3     —         (1     —         —         (39

Mark-to-market (gains)/losses from derivatives

    —         —         —         —         12       —         —         —         12  

Rounding

    —         —         —         —         —         1       —         —         1  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted (Non-GAAP)

  $ 133     $ 166     $ 401     $ 380     $ —       $ (72   $ (44   $ —       $ 964  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income Margin

                 

Revised %

    10.6     11.4     12.8     16.4             10.9

Revised Adjusted %

    15.4     12.0     17.9     21.7             15.5


Schedule 2.4

Mondelēz International, Inc. and Subsidiaries

Revised Amounts Reflecting Reclassification of Benefit Plan Components

Reconciliation of GAAP to Non-GAAP Measures

Segment Data

(in millions of U.S. dollars)

(Unaudited)

 

    For the Three Months Ended June 30, 2017  
    Latin
America
    AMEA     Europe     North
America
    Unrealized
G/(L) on
Hedging
Activities
    General
Corporate
Expenses
    Amortization
of Intangibles
    Other
Items
    Mondelēz
International
 

Net Revenue

                 

Reported (GAAP)

  $ 848     $ 1,394     $ 2,171     $ 1,573     $ —       $ —       $ —       $ —       $ 5,986  

Divestitures

    —         (66     (44     —         —         —         —         —         (110
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted (Non-GAAP)

  $ 848     $ 1,328     $ 2,127     $ 1,573     $ —       $ —       $ —       $ —       $ 5,876  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

                 

Reported (GAAP)

  $ 103     $ 162     $ 339     $ 214     $ (46   $ (84   $ (44   $ (3   $ 641  

Reclassification of benefit plan components

    (1     (1     (18     11       —         4       —         —         (5
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised (GAAP)

  $ 102     $ 161     $ 321     $ 225     $ (46   $ (80   $ (44   $ (3   $ 636  

2014-2018 Restructuring Program costs

    18       58       69       39       —         15       —         —         199  

Intangible asset impairment charges

    —         —         —         38       —         —         —         —         38  

(Income)/costs associated with the JDE coffee business transactions

    —         —         1       —         —         (1     —         —         —    

Malware incident incremental expenses

    —         —         2       4       —         1       —         —         7  

Operating income from divestitures

    —         (16     (12     —         —         —         —         —         (28

Divestiture-related costs

    —         1       3       —         —         —         —         —         4  

Loss on divestiture

    —         —         —         —         —         —         —         3       3  

Mark-to-market (gains)/losses from derivatives

    —         —         —         —         46       —         —         —         46  

Rounding

    —         —         —         —         —         1       —         —         1  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted (Non-GAAP)

  $ 120     $ 204     $ 384     $ 306     $ —       $ (64   $ (44   $ —       $ 906  

Currency

    (3     42       22       —         —         —         —         —         61  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted @ Constant FX (Non-GAAP)

  $ 117     $ 246     $ 406     $ 306     $ —       $ (64   $ (44   $ —       $ 967  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

% Change - Revised (GAAP)

    218.8     8.1     34.9     (27.2 )%      n/m       (25.0 )%      0.0     n/m       (0.2 )% 

% Change - Revised Adjusted (Non-GAAP)

    57.9     11.5     9.7     (19.7 )%      n/m       (45.5 )%      0.0     n/m       0.4

% Change - Revised Adjusted @ Constant FX (Non-GAAP)

    53.9     34.4     16.0     (19.7 )%      n/m       (45.5 )%      0.0     n/m       7.2

Operating Income Margin

                 

Revised %

    12.0     11.5     14.8     14.3             10.6

Revised pp change - year over year

    8.2 pp      1.2 pp      4.4 pp      (3.7 )pp              0.5 pp 

Revised Adjusted %

    14.2     15.4     18.1     19.5             15.4

Revised Adjusted pp change - year over year

    5.2 pp      2.1 pp      2.2 pp      (2.7 )pp              0.7 pp 

 

    For the Three Months Ended June 30, 2016  
    Latin
America
    AMEA     Europe     North
America
    Unrealized
G/(L) on
Hedging
Activities
    General
Corporate
Expenses
    Amortization
of Intangibles
    Other
Items
    Mondelēz
International
 

Net Revenue

                 

Reported (GAAP)

  $ 843     $ 1,446     $ 2,293     $ 1,720     $ —       $ —       $ —       $ —       $ 6,302  

Divestitures

    (2     (66     (85     —         —         —         —         —         (153
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted (Non-GAAP)

  $ 841     $ 1,380     $ 2,208     $ 1,720     $ —       $ —       $ —       $ —       $ 6,149  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

                 

Reported (GAAP)

  $ 32     $ 149     $ 256     $ 295     $ 17     $ (67   $ (44   $ —       $ 638  

Reclassification of benefit plan components

    —         —         (18     14       —         3       —         —         (1
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised (GAAP)

  $ 32     $ 149     $ 238     $ 309     $ 17     $ (64   $ (44   $ —       $ 637  

2014-2018 Restructuring Program costs

    44       44       48       65       —         18       —         —         219  

Acquisition integration costs

    —         3       —         —         —         —         —         —         3  

Gain on sale of intangible asset

    —         —         (6     —         —         —         —         —         (6

Intangible asset impairment charges

    —         —         5       7       —         —         —         —         12  

(Income)/costs associated with the JDE coffee business transactions

    —         —         —         —         —         1       —         —         1  

Operating income from divestitures

    —         (13     (19     —         —         1       —         —         (31

Divestiture-related costs

    —         —         84       —         —         —         —         —         84  

Mark-to-market (gains)/losses from derivatives

    —         —         —         —         (17     —         —         —         (17
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted (Non-GAAP)

  $ 76     $ 183     $ 350     $ 381     $ —       $ (44   $ (44   $ —       $ 902  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income Margin

                 

Revised %

    3.8     10.3     10.4     18.0             10.1

Revised Adjusted %

    9.0     13.3     15.9     22.2             14.7


Schedule 2.5

Mondelēz International, Inc. and Subsidiaries

Revised Amounts Reflecting Reclassification of Benefit Plan Components

Reconciliation of GAAP to Non-GAAP Measures

Segment Data

(in millions of U.S. dollars)

(Unaudited)

 

    For the Three Months Ended March 31, 2017  
    Latin
America
    AMEA     Europe     North
America
    Unrealized
G/(L) on
Hedging
Activities
    General
Corporate
Expenses
    Amortization
of Intangibles
    Other
Items
    Mondelēz
International
 

Net Revenue

                 

Reported (GAAP)

  $ 910     $ 1,491     $ 2,365     $ 1,648     $ —       $ —       $ —       $ —       $ 6,414  

Divestitures

    —         (59     (77     —         —         —         —         —         (136
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted (Non-GAAP)

  $ 910     $ 1,432     $ 2,288     $ 1,648     $ —       $ —       $ —       $ —       $ 6,278  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

                 

Reported (GAAP)

  $ 111     $ 181     $ 409     $ 292     $ (51   $ (58   $ (44   $ —       $ 840  

Reclassification of benefit plan components

    —         —         (16     —         —         1       —         —         (15
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised (GAAP)

  $ 111     $ 181     $ 393     $ 292     $ (51   $ (57   $ (44   $     $ 825  

2014-2018 Restructuring Program costs

    33       35       81       51       —         11       —         —         211  

Intangible asset impairment charges

    —         1       —         —         —         —         —         —         1  

Benefits from resolution of tax matters

    —         —         (46     —         —         —         —         —         (46

(Income)/costs associated with the JDE coffee business transactions

    —         —         (1     —         —         1       —         —         —    

Operating income from divestitures

    —         (10     (17     —         —         —         —         —         (27

Divestiture-related costs

    —         1       18       —         —         —         —         —         19  

Mark-to-market (gains)/losses from derivatives

    —         —         —         —         51       —         —         —         51  

Rounding

    —         —         —         —         —         (1     —         —         (1
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted (Non-GAAP)

  $ 144     $ 208     $ 428     $ 343     $ —       $ (46   $ (44   $ —       $ 1,033  

Currency

    (17     —         27       1       —         (2     (1     —         8  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted @ Constant FX (Non-GAAP)

  $ 127     $ 208     $ 455     $ 344     $ —       $ (48   $ (45   $ —       $ 1,041  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

% Change - Revised (GAAP)

    65.7     (4.7 )%      17.7     3.9     n/m       5.0     0.0     n/m       15.5

% Change - Revised Adjusted (Non-GAAP)

    69.4     (4.1 )%      0.7     (2.0 )%      n/m       4.2     0.0     n/m       4.9

% Change - Revised Adjusted @ Constant FX (Non-GAAP)

    49.4     (4.1 )%      7.1     (1.7 )%      n/m       0.0     (2.3 )%      n/m       5.7

Operating Income Margin

                 

Revised %

    12.2     12.1     16.6     17.7             12.9

Revised pp change - year over year

    4.0 pp      (0.4 )pp      3.0 pp      0.9 pp              1.8 pp 

Revised Adjusted %

    15.8     14.5     18.7     20.8             16.5

Revised Adjusted pp change - year over year

    5.4 pp      (0.4 )pp      0.7 pp      (0.1 )pp              0.9 pp 

 

    For the Three Months Ended March 31, 2016  
    Latin
America
    AMEA     Europe     North
America
    Unrealized
G/(L) on
Hedging
Activities
    General
Corporate
Expenses
    Amortization
of Intangibles
    Other
Items
    Mondelēz
International
 

Net Revenue

                 

Reported (GAAP)

  $ 817     $ 1,515     $ 2,448     $ 1,675     $     $     $     $     $ 6,455  

Divestitures

    (2     (62     (83     —         —         —         —         —         (147
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted (Non-GAAP)

  $ 815     $ 1,453     $ 2,365     $ 1,675     $     $     $     $     $ 6,308  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

                 

Reported (GAAP)

  $ 67     $ 190     $ 352     $ 271     $ (54   $ (60   $ (44   $     $ 722  

Reclassification of benefit plan components

    —         —         (18     10       —         —         —         —         (8
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised (GAAP)

  $ 67     $ 190     $ 334     $ 281     $ (54   $ (60   $ (44     —       $ 714  

2014-2018 Restructuring Program costs

    19       37       97       69       —         15       —         —         237  

Acquisition integration costs

    —         4       —         —         —         (1     —         —         3  

Intangible asset impairment charges

    —         —         14       —         —         —             14  

(Income)/costs associated with the JDE coffee business transactions

    —         —         —         —         —         (1     —         —         (1

Operating income from divestitures

    (1     (14     (20     —         —         —         —         —         (35

Mark-to-market (gains)/losses from derivatives

    —         —         —         —         54       —         —         —         54  

Rounding

    —         —         —         —         —         (1     —         —         (1
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted (Non-GAAP)

  $ 85     $ 217     $ 425     $ 350     $     $ (48   $ (44   $     $ 985  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income Margin

                 

Revised %

    8.2     12.5     13.6     16.8             11.1

Revised Adjusted %

    10.4     14.9     18.0     20.9             15.6


Schedule 2.6

Mondelēz International, Inc. and Subsidiaries

Revised Amounts Reflecting Reclassification of Benefit Plan Components

Reconciliation of GAAP to Non-GAAP Measures

Segment Data

(in millions of U.S. dollars)

(Unaudited)

 

    For the Twelve Months Ended December 31, 2016  
    Latin
America
    AMEA     Europe     North
America
    Unrealized
G/(L) on
Hedging
Activities
    General
Corporate
Expenses
    Amortization
of Intangibles
    Other
Items
    Mondelēz
International
 

Net Revenue

                 

Reported (GAAP)

  $ 3,392     $ 5,816     $ 9,755     $ 6,960     $ —       $ —       $ —       $ —       $ 25,923  

Divestitures

    (8     (261     (371     (13     —         —         —         —         (653
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted (Non-GAAP)

  $ 3,384     $ 5,555     $ 9,384     $ 6,947     $ —       $ —       $ —       $ —       $ 25,270  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

                 

Reported (GAAP)

  $ 271     $ 506     $ 1,267     $ 1,078     $ (94   $ (291   $ (176   $ 8     $ 2,569  

Reclassification of benefit plan components

    1       (1     (69     50       —         4       —         —         (15
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised (GAAP)

  $ 272     $ 505     $ 1,198     $ 1,128     $ (94   $ (287   $ (176   $ 8     $ 2,554  

2014-2018 Restructuring Program costs

    165       144       398       294       —         71       —         —         1,072  

Acquisition integration costs

    —         7       —         —         —         —         —         —         7  

Gain on sale of intangible asset

    —         —         (8     (7     —         —         —         —         (15

Intangible asset impairment charges

    2       45       50       39       —         1       —         —         137  

(Income)/costs associated with the JDE coffee business transactions

    —         —         (3     —         —         1       —         —         (2

Operating income from divestitures

    (2     (54     (89     (8     —         —         —         —         (153

Divestiture-related costs

    —           86       —         —         —         —         —         86  

Gain on divestiture

    —         —         —         —         —         —         —         (9     (9

Acquisition-related costs

    —         —         —         —         —         —         —         1       1  

Mark-to-market (gains)/losses from derivatives

    —         —         —         —         94       —         —         —         94  

Rounding

    —         —         —         —         —         1       —         —         1  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted (Non-GAAP)

  $ 437     $ 647     $ 1,632     $ 1,446     $ —       $ (213   $ (176   $ —       $ 3,773  

Currency

    65       24       82       3         (6     (8     —         160  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revised Adjusted @ Constant FX (Non-GAAP)

  $ 502     $ 671     $ 1,714     $ 1,449     $ —       $ (219   $ (184   $ —       $ 3,933  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

% Change - Revised (GAAP)

    (43.8 )%      30.5     (10.2 )%      (4.2 )%      n/m       24.3     2.8     n/m       (71.5 )% 

% Change - Revised Adjusted (Non-GAAP)

    9.0     25.1     9.0     8.1     n/m       (3.6 )%      (2.8 )%      n/m       12.6

% Change - Revised Adjusted @ Constant FX (Non-GAAP)

    25.2     29.8     14.5     8.3     n/m       0.9     (1.7 )%      n/m       17.4

Operating Income Margin

                 

Revised %

    8.0     8.7     12.3     16.2             9.9

Revised pp change - year over year

    (1.7 )pp      2.3 pp      0.9 pp      (0.7 )pp              (20.3 )pp 

Revised Adjusted %

    12.9     11.6     17.4     20.8             14.9

Revised Adjusted pp change - year over year

    2.2 pp      2.5 pp      2.0 pp      1.6 pp              2.1 pp 

 

    For the Twelve Months Ended December 31, 2015  
    Latin
America
    AMEA     Europe     North
America
    Unrealized
G/(L) on
Hedging
Activities
    General
Corporate
Expenses
    Amortization
of Intangibles
    Other
Items
    Mondelēz
International
 

Net Revenue

                 

Reported (GAAP)

  $ 4,988     $ 6,002     $ 11,672     $ 6,974     $ —       $ —       $ —       $ —       $ 29,636  

Divestitures

    (9     (269     (403     (14     —         —         —         —         (695

Historical Venezuelan operations

    (1,217     —         —         —         —         —         —         —         (1,217

Historical coffee business

    —         (66     (1,561     —         —         —         —         —         (1,627
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted (Non-GAAP)

  $ 3,762     $ 5,667     $ 9,708     $ 6,960     $ —       $ —       $ —       $ —       $ 26,097