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Packaged food makers have been struck by soaring shipping and labor expenses due to a strained supply chain, while surging demand for wheat, sugar and other commodities has driven up raw material costs, crimping margins across the sector.
The Chicago-based chocolatier said its gross margin declined to 37% in the fourth quarter from 39.4% a year earlier, sending its shares down about 3% in extended trading.
To offset the impact of higher costs, Mondelez (NASDAQ:MDLZ), like peers Conagra Brands (NYSE:CAG) and Kraft Heinz (NASDAQ:KHC), resorted to price hikes which, along with strong demand in emerging markets, helped boost its revenue.
The Cadbury chocolate maker, however, warned of an 8-cent hit to its full-year adjusted earnings per share from foreign currency translation, adding it would decrease net revenue growth by about 2.5%.
Mondelez revenue rose 4.9% to $7.66 billion in the fourth quarter ended Dec. 31, topping analysts’ average estimate of $7.59 billion.
Excluding items, the Ritz crackers maker earned 71 cents per share in the reported quarter, on a constant-currency basis, falling short of analysts’ estimate by 1 cent, according to Refinitiv IBES data.
