Mondelez International is staying in its lane for the moment, albeit one that’s speeding along and growing.
Chairman and CEO Dirk Van de Put provided some insight into the No. 21 consumer goods company’s acquisition plans, noting that while they wouldn’t rule out a large acquisition, he didn’t view it as likely.
The company has picked up a number of smaller companies recently, including the Grenade high-protein bar brand in March, Hu chocolate brand in January and Give & Go in April 2020, but has avoided larger companies. The acquisitions are driving accelerated growth, Van de Put said in an earnings call, and are expected to have a long runway (though Hu still requires more brand building and distribution work to be done).
Mondelez remains committed to the snacking category, while executing acquisitions that quicken its overall growth rate, he said. As part of this, it expects these deals to come from category adjacencies, geographical white spaces, and fast-growing segments in current markets.
“If there would be a larger acquisition that would provide us the opportunity to get bigger in snacking or get an accelerated — and/or get an accelerated growth rate, we're certainly open to it,” said Van de Put. “But it's just very difficult to find, and we're hesitant.”
And while Mondelez would likely be open to entering other areas of snacking, it remains cautious about entering other food categories, which are showing less growth. As a result, finding the right sizable acquisitions is that much more difficult.
With that said, Van de Put said the company is still “totally open” to the prospect.
Mondelez reported net revenue growth of 7.9% for the first quarter, with organic net revenue increasing 3.8%. Within the e-commerce channel, it recorded 77% growth for the quarter vs. the prior year, representing about 6% of overall revenue for the period.
Looking ahead, the company expects elevated at-home consumption to continue, with consumers continuing to snack more, as well as continued strength in mass retail and higher sustained e-commerce adoption. It also views discounters as another retail opportunity.