Mondelez Sharpens Focus on Chocolate and Biscuits

Mondelez International announced its plans to focus development on chocolate and biscuits in order to sustain and accelerate profitable growth. 

“Chocolate and biscuits are attractive and historically durable categories in both developed and emerging markets, and they still have significant headroom in terms of penetration and per capita consumption,” said Dirk Van de Put, chief executive officer. “Our revenue from these two core categories combined grew nearly 6% on average over the last three years compared to a decline in our revenue from other categories, in part due to the COVID-related disruption of the gum category. Over the past 10 years, we have been reshaping the business from approximately 60% chocolate and biscuits to almost 80%. And our long-term vision is to generate 90% of revenue through these two core categories.”

The company has already taken steps in this direction, by reaching an agreement in late April to acquire the Ricolino confectionery business of Grupo Bimbo SAB de CV for approximately USD1.3bn as well as adding Chipita SA, a leader in the Central and Eastern European snack-size cakes and pastries categories, earlier this year. In 2021, Mondelez acquired Grenade, a UK performance nutrition company; Gourmet Food Holdings, an Australian food company in the premium biscuit and cracker category; and Hu, a well-being snacking company in the United States.

Mondelez expects to reach the 90% target in the next three to four years.

Gustavo Carlos Valle, executive vice president and president of North America, identified four key growth drivers for the company, led by plans to expand Oreo by $1 billion over the next three years. A second growth driver will revolve around robust plans to grow the company’s “jewel” biscuits brands. A third growth driver for Mondelez will be geared toward accelerating performance in its chocobakery business. Mr. Gruber said Mondelez has been able to grow its chocobakery business to nearly USD500m in revenues from next to nothing in a short period of time. The final element in Mondelez’s growth strategy is expanding in the fast-growing baked snack segment.