(Reuters) -Cadbury-parent Mondelez Worldwide forecast a bigger-than-estimated drop in its annual income on Tuesday, signaling pressures from bigger costs, along with from surging cocoa prices, sending its shares down virtually 6% after the bell.
Prices of cocoa — a key ingredient in chocolate — have elevated relentlessly over the earlier yr, forcing companies akin to Mondelez to hike prices of their merchandise.
That has pushed budget-strained clients, who had been already grappling with a cost-of-living catastrophe, in direction of cheaper alternate choices.
Chicago-based Mondelez expects its 2025 income to fall 10% on an adjusted basis, in distinction with analysts’ widespread estimate of a 6.7% decline, according to data compiled by LSEG.
“This outlook doesn’t replicate any imposition of import tariffs by the U.S. and potential retaliatory actions taken by completely different worldwide areas, as a result of the tariff and commerce setting is uncertain and rapidly evolving for the time being,” the Oreo and Toblerone maker acknowledged.
Mondelez’s volumes in Europe, its largest market by revenue, fell throughout the fourth quarter on account of incremental worth hikes. In North America, however, volumes elevated following a 0.9-percentage-point low cost in prices.
The surge in cocoa prices, coupled with bigger transportation costs, led to a 650-basis-point decline throughout the agency’s adjusted gross income margin to 31.5%.
Mondelez reported net revenue of $9.60 billion for the three months ended Dec. 31, in distinction with the estimates of $9.64 billion.
On an adjusted basis, it earned 65 cents per share, beneath analysts’ estimate of 66 cents per share.
(Reporting by Neil J Kanatt in Bengaluru; Modifying by Shilpi Majumdar)
