Mondelez International (MDLZ) has reported a 13.72 percent rise in profit for the quarter ended Mar. 31, 2017. The company has earned $630 million, or $0.41 a share in the quarter, compared with $554 million, or $0.35 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $826 million, or $0.53 a share compared with $808 million or $0.51 a share, a year ago.
Revenue during the quarter went down marginally by 0.64 percent to $6,414 million from $6,455 million in the previous year period. Gross margin for the quarter expanded 10 basis points over the previous year period to 39.37 percent. Total expenses were 86.90 percent of quarterly revenues, down from 88.81 percent for the same period last year. This has led to an improvement of 191 basis points in operating margin to 13.10 percent.
Operating income for the quarter was $840 million, compared with $722 million in the previous year period.
However, the adjusted operating income for the quarter stood at $1,075 million compared to $1,028 million in the prior year period. At the same time, adjusted operating margin improved 83 basis points in the quarter to 16.76 percent from 15.93 percent in the last year period.
"We had a solid start to the year despite challenging market conditions," said Irene Rosenfeld, chairman and chief executive officer. "We delivered both top-line organic growth and strong margin expansion in the quarter, while also making critical investments for our future. We remain confident in and committed to our balanced strategy for both top- and bottom-line growth, continuing to focus on what we can control to deliver long-term value creation for our shareholders."
Operating cash flow remains negative
Mondelez International has spent $557 million cash to meet operating activities during the quarter as against cash outgo of $454 million in the last year period.
The company has spent $287 million cash to meet investing activities during the quarter as against cash outgo of $316 million in the last year period.
Cash flow from financing activities was $378 million for the quarter, up 82.61 percent or $171 million, when compared with the last year period.
Cash and cash equivalents stood at $1,307 million as on Mar. 31, 2017, down 2.32 percent or $31 million from $1,338 million on Mar. 31, 2016.
Working capital remains negative
Working capital of Mondelez International was negative $6,642 million on Mar. 31, 2017 compared with negative $4,169 million on Mar. 31, 2016. Current ratio was at 0.56 as on Mar. 31, 2017, down from 0.68 on Mar. 31, 2016.
Cash conversion cycle (CCC) has increased to 29 days for the quarter from 8 days for the last year period. Days sales outstanding went down to 54 days for the quarter compared with 58 days for the same period last year.
Days inventory outstanding has decreased to 30 days for the quarter compared with 62 days for the previous year period. At the same time, days payable outstanding went up to 113 days for the quarter from 112 for the same period last year.
Debt moves up
Mondelez International has witnessed an increase in total debt over the last one year. It stood at $18,374 million as on Mar. 31, 2017, up 5.60 percent or $975 million from $17,399 million on Mar. 31, 2016. Total debt was 29.60 percent of total assets as on Mar. 31, 2017, compared with 27.20 percent on Mar. 31, 2016. Debt to equity ratio was at 0.71 as on Mar. 31, 2017, up from 0.62 as on Mar. 31, 2016.
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