Mondelēz CEO eyes opportunities for healthy snacks

Mondelēz chief Dirk van de Put has acknowledged the need for a new business direction to ‘grab some of the growth’ observed in the healthy foods industry from increased consumer demand.

In response to questioning over Mondelēz’s unhealthy snacks selection, van de Put revealed at the Consumer Analyst Group of New York (CAGNY) investment conference that, while luxury chocolate brands were performing well, the company’s iconic confectionary such as Cadbury, Milka and Belvita were suffering from lower growth.

“There are clearly categories growing faster in snacking. We want to do something about that going forward and we are expecting, organically and inorganically to grab some of that growth,” he said. “At the same time there are opportunities to make the current categories grow faster.”

Van de Put mentioned the need for a fresh approach to keep up with consumer trends and explore new ideas to stimulate growth.

“Today’s consumers eat differently, shop differently and seek different experiences. Since consumers are changing fast, we have to be more nimble, innovative and forward-looking than ever before,” he said.

The CEO also mentioned the importance of improving Mondelēz’s North American supply chain after recording falling sales, in part due to a cyber-attack last year.

In response to the comments, Susquehanna International Group (SIG) analyst Pablo Zuanic said: “Mondelēz may take a bit longer to deliver owing to mixed trends in the snacks portfolio, in our view. We did not think there was a lot of new material in this presentation.”

Sanford Bernstein analyst Alexia Howard commented that the company grew in net revenue by more than 40% in e-commerce channels in 2017, which is expected to be a $1bn enterprise by 2020.

“We remain positive on the company’s progress made in e-commerce as believe that e-commerce, especially in China, represents a highly incremental growth opportunity for Mondelēz as more people purchase snacks online,” Howard said.

Mondelēz noted uneven execution of the supply chain in the US market but this is expected to recover after a few quarters. “The company believes that there are still opportunities to continue to make progress in supply chain reinvention,” Howard added.

Van de Put brought up the acquirement of a licence to sell Cadbury-branded biscuits to the international market: “This allowed us to explore delicious new products by using a combination of our chocolate and biscuit platforms. It’s been a great success. Cadbury biscuits in the UK have grown more than 60% in the last year. It was driven by our unique chocobakery combinations.”

He also said at the CAGNY conference that a complete business plan for 2018 would be unveiled later this year along with a strategic business review on how to retain shareholder value.