| ☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||||
March 31, 2021
| ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||||
| Virginia | 52-2284372 | ||||||||
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | ||||||||
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| 905 West Fulton Market, Suite 200 | |||||||||
| Illinois | ||||||||
| (Address of principal executive offices) | (Zip Code) | ||||||||
| Tile of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
| Class A Common Stock, no par value | MDLZ | The Nasdaq Global Select Market | ||||||||||||
| 1.625% Notes due 2027 | MDLZ27 | The Nasdaq Stock Market LLC | ||||||||||||
| 0.250% Notes due 2028 | MDLZ28 | The Nasdaq Stock Market LLC | ||||||||||||
| 0.750% Notes due 2033 | MDLZ33 | The Nasdaq Stock Market LLC | ||||||||||||
| 2.375% Notes due 2035 | MDLZ35 | The Nasdaq Stock Market LLC | ||||||||||||
| 4.500% Notes due 2035 | MDLZ35A | The Nasdaq Stock Market LLC | ||||||||||||
| 1.375% Notes due 2041 | MDLZ41 | The Nasdaq Stock Market LLC | ||||||||||||
| 3.875% Notes due 2045 | MDLZ45 | The Nasdaq Stock Market LLC | ||||||||||||
| Large accelerated filer | x | Accelerated filer | ☐ | ||||||||||||||
| Non-accelerated filer | ☐ | Smaller reporting company | ☐ | ||||||||||||||
| Emerging growth company | ☐ | ||||||||||||||||
Financial Statements (Unaudited) OTHER INFORMATION Net revenues Cost of sales Gross profit Selling, general and administrative expenses Asset impairment and exit costs Net gain on divestitures Amortization of intangibles Operating income Interest and other expense, net Earnings before income taxes Provision for income taxes Gain on equity method investment exchange Equity method investment net earnings Net earnings Noncontrolling interest earnings Net earnings attributable to Mondelēz International Per share data: Basic earnings per share attributable to Diluted earnings per share attributable to Dividends declared Net earnings Other comprehensive earnings/(losses), net of tax: Currency translation adjustment Pension and other benefit plans Derivative cash flow hedges Total other comprehensive earnings/(losses) Comprehensive earnings less: Comprehensive earnings/(losses) attributable to noncontrolling interests Comprehensive earnings attributable to ASSETS Cash and cash equivalents Trade receivables (net of allowances of $48 at September 30, 2017 Other receivables (net of allowances of $101 at September 30, 2017 Inventories, net Other current assets Total current assets Property, plant and equipment, net Goodwill Intangible assets, net Prepaid pension assets Deferred income taxes Equity method investments Other assets TOTAL ASSETS LIABILITIES Short-term borrowings Current portion of long-term debt Accounts payable Accrued marketing Accrued employment costs Other current liabilities Total current liabilities Long-term debt Deferred income taxes Accrued pension costs Accrued postretirement health care costs Other liabilities TOTAL LIABILITIES Commitments and Contingencies (Note 11) EQUITY Common Stock, no par value (5,000,000,000 shares authorized and 1,996,537,778 shares issued at September 30, 2017 and December 31, 2016) Additional paid-in capital Retained earnings Accumulated other comprehensive losses Treasury stock, at cost (501,158,385 shares at September 30, 2017 and 468,172,237 shares at December 31, 2016) Total Mondelēz International Shareholders’ Equity Noncontrolling interest TOTAL EQUITY TOTAL LIABILITIES AND EQUITY Balances at January 1, 2016 Comprehensive earnings/(losses): Net earnings Other comprehensive earnings/(losses), net of income taxes Exercise of stock options and issuance of other stock awards Common Stock repurchased Cash dividends declared ($0.72 per share) Dividends paid on noncontrolling interest and other activities Balances at December 31, 2016 Comprehensive earnings/(losses): Net earnings Other comprehensive earnings/(losses), net of income taxes Exercise of stock options and issuance of other stock awards Common Stock repurchased Cash dividends declared ($0.60 per share) Dividends paid on noncontrolling interest and other activities Balances at September 30, 2017 CASH PROVIDED BY/(USED IN) OPERATING ACTIVITIES Net earnings Adjustments to reconcile net earnings to operating cash flows: Depreciation and amortization Stock-based compensation expense Deferred income tax provision/(benefit) Asset impairments and accelerated depreciation Loss on early extinguishment of debt Gain on equity method investment exchange Net gain on divestitures Equity method investment net earnings Distributions from equity method investments Other non-cash items, net Change in assets and liabilities, net of acquisitions and divestitures: Receivables, net Inventories, net Accounts payable Other current assets Other current liabilities Change in pension and postretirement assets and liabilities, net Net cash provided by operating activities CASH PROVIDED BY/(USED IN) INVESTING ACTIVITIES Capital expenditures Proceeds from divestitures, net of disbursements Proceeds from JDE coffee business transaction and divestiture, net of disbursements Proceeds from sale of property, plant and equipment and other assets Net cash used in investing activities CASH PROVIDED BY/(USED IN) FINANCING ACTIVITIES Issuances of commercial paper, maturities greater than 90 days Repayments of commercial paper, maturities greater than 90 days Net issuances of other short-term borrowings Long-term debt proceeds Long-term debt repaid Repurchase of Common Stock Dividends paid Other Net cash used in financing activities Effect of exchange rate changes on cash and cash equivalents Cash and cash equivalents: Decrease Balance at beginning of period Balance at end of period 2020. Currency Translation and Highly Inflationary Accounting: accounting for our operations in Argentina. U.K. allowances for credit losses consisted of: acquisition-related costs. Raw materials Finished product Inventory reserves Inventories, net Latin America AMEA Europe North America Corporate Total non-cash assetwrite-downs Latin America AMEA Europe North America Goodwill was: Non-amortizable intangible assets Amortizable intangible assets Accumulated amortization Intangible assets, net rates). Balance at January 1, 2017 Currency Divestitures Acquisition Asset impairments Balance at September 30, 2017 $279 million to intangible assets. See Note 2, 2022. Liability balance, January 1, 2017 Charges Cash spent Non-cash settlements/adjustments Currency Liability balance, September 30, 2017 costs and benefit plan non-service income. Costs: For the Three Months Ended Restructuring Costs Implementation Costs Total For the Nine Months Ended Restructuring Costs Implementation Costs Total For the Three Months Ended Restructuring Costs Implementation Costs Total For the Nine Months Ended Restructuring Costs Implementation Costs Total Total Project 2014-2017(3) Restructuring Costs Implementation Costs Total Commercial paper Bank loans Total short-term borrowings 2020 include: premiums. Interest expense, debt Loss on debt extinguishment Loss related to interest rate swaps Other (income)/expense, net Interest and other expense, net Derivatives designated as Currency exchange contracts Commodity contracts Interest rate contracts Derivatives not designated Currency exchange contracts Commodity contracts Interest rate contracts Total fair value Currency exchange contracts Commodity contracts Interest rate contracts Total derivatives Currency exchange contracts Commodity contracts Interest rate contracts Total derivatives Currency exchange contracts: Intercompany loans and forecasted interest payments Forecasted transactions Commodity contracts Interest rate contracts Net investment hedge – euro notes Net investment hedge – pound sterling notes Net investment hedge – Swiss franc notes Accumulated (loss)/gain at beginning of period Transfer of realized (gains)/losses in fair value to earnings Unrealized gain/(loss) in fair value Accumulated (loss)/gain at end of period After-tax gains/(losses) reclassified from accumulated other comprehensive earnings/(losses) into net earnings were: Currency exchange contracts – forecasted transactions Commodity contracts Interest rate contracts Total After-tax gains/(losses) recognized in other comprehensive earnings/(losses) were: Currency exchange contracts – forecasted transactions Commodity contracts Interest rate contracts Total Derivatives Borrowings Fair value hedge ineffectiveness and amounts excluded from effectiveness testing were not material for all periods presented. Economic Hedges: Pre-tax gains/(losses) recorded in net earnings for economic hedges were: Location of in Earnings Currency exchange contracts: Intercompany loans and forecasted interest payments Forecasted transactions Forecasted transactions Forecasted transactions Commodity contracts Total Hedges of Net Investments in International Operations: After-tax gains/(losses) related to hedges of net investments in international operations in the form of euro, pound sterling and Swiss franc-denominated debt were: Location of Euro notes Pound sterling notes Swiss franc notes net. Service cost Interest cost Expected return on plan assets Amortization: Net loss from experience differences Prior service credit Settlement losses and other expenses Net periodic pension cost Service cost Interest cost Expected return on plan assets Amortization: Net loss from experience differences Prior service cost/(credit) Settlement losses/(gains) and other expenses Net periodic pension cost Service cost Interest cost Amortization: Net loss from experience differences Prior service credit(1) Net periodic postretirement health care (credits)/costs Service cost Interest cost Amortization of net gains Net periodic postemployment costs Balance at January 1, 2017 Annual grant to eligible employees Additional options issued Total options granted Options exercised(1) Options cancelled Balance at September 30, 2017 Balance at January 1, 2017 Annual grant to eligible employees: Performance share units Deferred stock units Additional shares granted(1) Total shares granted Vested(2) Forfeited(2) Balance at September 30, 2017 this matter. Currency Translation Adjustments: Balance at beginning of period Currency translation adjustments Reclassification to earnings related to: Equity method investment exchange Tax benefit/(expense) Other comprehensive earnings/(losses) Less: (gain)/loss attributable to noncontrolling interests Balance at end of period Pension and Other Benefit Plans: Balance at beginning of period Net actuarial (loss)/gain arising during period Tax benefit/(expense) on net actuarial loss Losses/(gains) reclassified into net earnings: Amortization of experience losses and prior service costs(1) Settlement losses and other expenses(1) Tax benefit on reclassifications (2) Currency impact Other comprehensive (losses)/earnings Balance at end of period Derivative Cash Flow Hedges: Balance at beginning of period Net derivative gains/(losses) Tax benefit on net derivative gain/(loss) Losses/(gains) reclassified into net earnings: Currency exchange contracts – forecasted transactions(3) Commodity contracts(3) Interest rate contracts(4) Tax benefit on reclassifications (2) Currency impact Other comprehensive earnings/(losses) Balance at end of period Accumulated other comprehensive income attributable to Mondelēz International: Balance at beginning of period Total other comprehensive earnings/(losses) Less: loss/(gain) attributable to noncontrolling interests Other comprehensive earnings/(losses) attributable to Mondelēz International Balance at end of period other expense, net. Treasury Department. Net earnings Noncontrolling interest (earnings) Net earnings attributable to Mondelēz International Weighted-average shares for basic EPS Plus incremental shares from assumed conversions Weighted-average shares for diluted EPS Basic earnings per share attributable to Diluted earnings per share attributable to We manage our operations by region to leverage regional operating scale, manage different and changing business environments more effectively and pursue growth opportunities as they arise Net revenues: Latin America AMEA Europe North America Net revenues Earnings before income taxes: Operating income: Latin America AMEA Europe North America Unrealized gains/(losses) on hedging activities (mark-to-market impacts) General corporate expenses Amortization of intangibles Net gain on divestitures Operating income Interest and other expense, net Earnings before income taxes Biscuits Chocolate Gum & Candy Beverages Cheese & Grocery Total net revenues Biscuits Chocolate Gum & Candy Beverages Cheese & Grocery Total net revenues Biscuits Chocolate Gum & Candy Beverages Cheese & Grocery Total net revenues Biscuits Chocolate Gum & Candy Beverages Cheese & Grocery Total net revenues administrative expenses related to the revaluation of our Argentinean peso denominated net monetary position. The mix of monetary assets and liabilities and the exchange rate to convert Argentinean pesos to U.S. dollars could change over time, so it is difficult to predict the overall impact of the Argentina highly inflationary accounting on future net earnings. Gain on equity method investment exchange 2014-2018 Restructuring Program: Restructuring charges Implementation charges Loss related to interest rate swaps Loss on debt extinguishment Intangible asset impairment charges Divestitures and sales of property Net gain on divestitures Gain on sale of intangible assets Divestiture-related costs Gains on sales of property Mark-to-market gains/(losses) from derivatives Benefits from resolution of tax matters(1) Malware incident incremental expenses Effective tax rate Net revenues Operating income Net earnings attributable to Mondelēz International Diluted earnings per share attributable to Mondelēz International March 31: Change in net revenues (by percentage point) Total change in net revenues Add back the following items affecting comparability: Higher net pricing Favorable volume/mix Operating Income for the Three Months Ended September 30, 2016 2014-2018 Restructuring Program costs(2) Intangible asset impairment charges(3) Mark-to-market losses from derivatives(4) Operating income from divestitures(5) Gain on sale of intangible assets(6) Other/rounding Adjusted Operating Income(1) for the Higher net pricing Higher input costs Favorable volume/mix Lower selling, general and administrative expenses VAT-related settlement Gains on sales of property(7) Impact from acquisition(7) Total change in Adjusted Operating Income (constant currency) (1) Favorable currency – translation Total change in Adjusted Operating Income(1) Adjusted Operating Income(1) for the 2014-2018 Restructuring Program costs(2) Intangible asset impairment charges(3) Mark-to-market gains from derivatives(4) Malware incident incremental expenses Acquisition integration costs(8) Operating income from divestitures(5) Gain on divestiture(5) Benefits from resolution of tax matters(9) Other/rounding Operating Income for the Three Months Ended September 30, 2017 energy. Excluding productivity efforts, partially offset by higher advertising and consumer promotion costs. Russian ruble. manufacturing costs and lower overhead costs, partially offset by higher raw material costs and higher advertising and consumer promotion costs. Diluted EPS Attributable to Mondelēz International for the 2014-2018 Restructuring Program costs (2) Intangible asset impairment charges(2) Mark-to-market gains from derivatives(2) Net earnings from divestitures(2) Gain on sale of intangible assets(2) Equity method investee acquisition-related and other adjustments(3) Adjusted EPS(1) for the Three Months Ended September 30, 2016 Increase in operations Increase in equity method investment net earnings VAT-related settlements Gains on sales of property(2) Impact from acquisition (2) Lower interest and other expense, net(4) Changes in shares outstanding(5) Changes in income taxes (6) Adjusted EPS (constant currency)(1) for the Three Months Ended September 30, 2017 Favorable currency – translation Adjusted EPS(1) for the Three Months Ended September 30, 2017 2014-2018 Restructuring Program costs (2) Intangible asset impairment charges(2) Mark-to-market gains from derivatives(2) Malware incident incremental expenses Divestiture-related costs(7) Net earnings from divestitures(2) Gain on divestiture(2) Benefits from resolution of tax matters(2) Equity method investee acquisition-related and other adjustments (3) Diluted EPS Attributable to Mondelēz International for the Net revenues Operating income Net earnings attributable to Mondelēz International Diluted earnings per share attributable to Mondelēz International Operating Income for the Nine Months Ended September 30, 2016 2014-2018 Restructuring Program costs(2) Intangible asset impairment charges(3) Mark-to-market losses from derivatives(4) Acquisition integration costs(5) Divestiture-related costs(6) Operating income from divestitures(6) Gain on sale of intangible assets(7) Other/rounding Adjusted Operating Income(1) for the Higher net pricing Higher input costs Unfavorable volume/mix Lower selling, general and administrative expenses Gains on sales of property(8) VAT-related settlements Property insurance recovery Impact from acquisitions(8) Other Total change in Adjusted Operating Income (constant currency) (1) Unfavorable currency – translation Total change in Adjusted Operating Income(1) Adjusted Operating Income(1) for the 2014-2018 Restructuring Program costs(2) Intangible asset impairment charges(3) Mark-to-market losses from derivatives(4) Malware incident incremental expenses Acquisition integration costs(5) Divestiture-related costs(6) Operating income from divestitures(6) Net gain on divestitures(6) Benefits from resolution of tax matters(9) Other/rounding Operating Income for the Nine Months Ended September 30, 2017 Diluted EPS Attributable to Mondelēz International for the 2014-2018 Restructuring Program costs (2) Intangible asset impairment charges(2) Mark-to-market losses from derivatives(2) Divestiture-related costs(2) Net earnings from divestitures(2) Gain on sale of intangible assets(2) Loss related to interest rate swaps(3) Gain on equity method investment exchange (4) Equity method investee acquisition-related and other adjustments (5) Adjusted EPS(1) for the Nine Months Ended September 30, 2016 Increase in operations Increase in equity method investment earnings Gains on sales of property(2) VAT-related settlements Property insurance recovery Impact of acquisition(2) Lower interest and other expense, net(6) Changes in shares outstanding(7) Changes in income taxes(8) Adjusted EPS (constant currency)(1) for the Nine Months Ended September 30, 2017 Unfavorable currency – translation Adjusted EPS(1) for the Nine Months Ended September 30, 2017 2014-2018 Restructuring Program costs (2) Intangible asset impairment charges(2) Mark-to-market losses from derivatives(2) Malware incident incremental expenses Divestiture-related costs(2) Net earnings from divestitures(2) Net gain on divestitures(2) Acquisition integration costs(2) Benefits from resolution of tax matters(2) Loss on debt extinguishment(9) Equity method investee acquisition-related and other adjustments (5) Diluted EPS Attributable to Mondelēz International for the Net revenues: Latin America AMEA Europe North America Net revenues Earnings before income taxes: Operating income: Latin America AMEA Europe North America Unrealized gains/(losses) on hedging activities (mark-to-market impacts) General corporate expenses Amortization of intangibles Net gain on divestitures Operating income Interest and other expense, net Earnings before income taxes Net revenues Segment operating income Net revenues Segment operating income March 31: Net revenues Segment operating income Net revenues Segment operating income categories, driven primarily by Argentina, Brazil and Mexico. Net revenues Segment operating income Net revenues Segment operating income costs incurred for the Simplify to Grow Program. March 31: March 31: Net revenues Segment operating income Net revenues Segment operating income gum. Unfavorable volume mix reflects impacts from the COVID-19 pandemic, as lower out-of-home consumption continued to negatively impact sales of our gum and candy products and our foodservice business. Unfavorable volume/mix was driven by declines in candy, gum and chocolate partially offset by gains in biscuits. acquisitions. operations and financial condition. cash tax payments and lower cash dividends received from our equity method investments. higher dividends paid. dairy and energy. 2020. 2021. Net Revenue Impact of currency Impact of acquisition Impact of divestitures Organic Net Revenue Net Revenue Impact of currency Impact of acquisition Impact of divestitures Organic Net Revenue Net Revenue Impact of currency Impact of acquisition Impact of divestitures Organic Net Revenue Net Revenue Impact of currency Impact of acquisition Impact of divestitures Organic Net Revenue Operating Income 2014-2018 Restructuring Program costs (1) Intangible asset impairment charges (2) Mark-to-market (gains)/losses from derivatives (3) Malware incident incremental expenses Acquisition integration costs (4) Operating income from divestitures(5) Gain on divestiture(5) Gain on sale of intangible assets(6) Benefits from resolution of tax matters (7) Other/rounding Adjusted Operating Income Impact of favorable currency Adjusted Operating Income (constant currency) Operating Income 2014-2018 Restructuring Program costs (1) Intangible asset impairment charges(2) Mark-to-market losses from derivatives (3) Malware incident incremental expenses Acquisition integration costs(4) Divestiture-related costs(5) Operating income from divestitures(5) Net gain on divestitures(5) Gain on sale of intangible assets(6) Benefits from resolution of tax matters (7) Other/rounding Adjusted Operating Income Impact of unfavorable currency Adjusted Operating Income (constant currency) Diluted EPS attributable to Mondelēz International 2014-2018 Restructuring Program costs (2) Intangible asset impairment charges(2) Mark-to-market (gains)/losses from derivatives(2) Malware incident incremental expenses Divestiture-related costs(2) Net earnings from divestitures(2) Gain on divestiture(2) Benefits from resolution of tax matters (2) Equity method investee acquisition-related and other adjustments(3) Adjusted EPS Impact of favorable currency Adjusted EPS (constant currency) Diluted EPS attributable to Mondelēz International 2014-2018 Restructuring Program costs (2) Intangible asset impairment charges(2) Mark-to-market losses from derivatives (2) Malware incident incremental expenses Divestiture-related costs(2) Net earnings from divestitures(2) Net gain on divestitures(2) Acquisition integration costs(2) Benefits from resolution of tax matters (2) Loss related to interest rate swaps(4) Loss on debt extinguishment(5) Gain on equity method investment exchange (6) Equity method investee acquisition-related and other adjustments(3) Adjusted EPS Impact of unfavorable currency Adjusted EPS (constant currency) March 31, 2021. March 31, 2021. Period July 1-31, 2017 August 1-31, 2017 September 1-30, 2017 For the Quarter Ended September 30, 2017 Exhibit DescriptionPage No. PART I - FINANCIAL INFORMATION Item 1. Item 2. Item 3. 54Item 4. 55PART II - Item 1. 56Item 1A. 56Item 2. 56Item 6. 5758 For the Three Months Ended
September 30, For the Nine Months Ended
September 30, 2017 2016 2017 2016 $ 6,530 $ 6,396 $ 18,930 $ 19,153 3,978 3,908 11,529 11,614 2,552 2,488 7,401 7,539 1,330 1,552 4,254 4,835 183 190 536 510 (187 ) – (184 ) – 45 44 133 132 1,181 702 2,662 2,062 19 145 262 540 1,162 557 2,400 1,522 (272 ) (40 ) (510 ) (207 ) – – – 43 103 31 236 218 993 548 2,126 1,576 (1 ) – (6 ) (10 ) $ 992 $ 548 $ 2,120 $ 1,566
Mondelēz International $ 0.66 $ 0.35 $ 1.40 $ 1.00
Mondelēz International $ 0.65 $ 0.35 $ 1.38 $ 0.99 $ 0.22 $ 0.19 $ 0.60 $ 0.53 For the Three Months Ended
March 31, 2021 2020 Net revenues $ 7,238 $ 6,707 Cost of sales 4,272 4,256 Gross profit 2,966 2,451 Selling, general and administrative expenses 1,564 1,537 Asset impairment and exit costs 90 15 Gain on acquisition (9) 0 Amortization of intangibles 38 43 Operating income 1,283 856 Benefit plan non-service income (44) (33) Interest and other expense, net 218 190 Earnings before income taxes 1,109 699 Income tax provision (212) (148) (Loss)/gain on equity method investment transactions (7) 71 Equity method investment net earnings 78 121 Net earnings 968 743 Noncontrolling interest earnings (7) (7) Net earnings attributable to Mondelēz International $ 961 $ 736 Per share data: Basic earnings per share attributable to Mondelēz International $ 0.68 $ 0.51 Diluted earnings per share attributable to Mondelēz International $ 0.68 $ 0.51 For the Three Months Ended
September 30, For the Nine Months Ended
September 30, 2017 2016 2017 2016 $ 993 $ 548 $ 2,126 $ 1,576 337 28 1,260 131 (10 ) 37 (42 ) 141 (19 ) 2 11 12 308 67 1,229 284 1,301 615 3,355 1,860 9 (2 ) 30 7
Mondelēz International $ 1,292 $ 617 $ 3,325 $ 1,853 For the Three Months Ended
March 31, 2021 2020 Net earnings $ 968 $ 743 Other comprehensive earnings/(losses), net of tax: Currency translation adjustment (136) (1,371) Pension and other benefit plans 69 60 Derivative cash flow hedges 2 58 Total other comprehensive earnings/(losses) (65) (1,253) Comprehensive earnings/(losses) 903 (510) less: Comprehensive earnings/(losses) attributable to
noncontrolling interests(2) 2 Comprehensive earnings/(losses) attributable to Mondelēz International $ 905 $ (512) September 30, December 31, 2017 2016 $ 844 $ 1,741
and $58 at December 31, 2016) 2,981 2,611
and $93 at December 31, 2016) 932 859 2,781 2,469 617 800 8,155 8,480 8,538 8,229 21,071 20,276 18,638 18,101 148 159 332 358 6,060 5,585 349 350 $ 63,291 $ 61,538 $ 4,551 $ 2,531 1,164 1,451 5,139 5,318 1,651 1,745 699 736 2,831 2,636 16,035 14,417 12,918 13,217 4,664 4,721 1,684 2,014 395 382 1,496 1,572 37,192 36,323 – – 31,886 31,847 22,296 21,149 (9,917 ) (11,122 ) (18,234 ) (16,713 ) 26,031 25,161 68 54 26,099 25,215 $ 63,291 $ 61,538 March 31, 2021 December 31, 2020 ASSETS Cash and cash equivalents $ 2,028 $ 3,619 2,655 2,297 660 657 Inventories, net 2,635 2,647 Other current assets 865 759 Total current assets 8,843 9,979 Property, plant and equipment, net 8,766 9,026 Operating lease right of use assets 609 638 Goodwill 21,945 21,895 Intangible assets, net 18,527 18,482 Prepaid pension assets 742 672 Deferred income taxes 725 790 Equity method investments 5,916 6,036 Other assets 276 292 TOTAL ASSETS $ 66,349 $ 67,810 LIABILITIES Short-term borrowings $ 674 $ 29 Current portion of long-term debt 1,895 2,741 Accounts payable 6,372 6,209 Accrued marketing 2,136 2,130 Accrued employment costs 670 834 Other current liabilities 2,803 3,216 Total current liabilities 14,550 15,159 Long-term debt 16,961 17,276 Long-term operating lease liabilities 447 470 Deferred income taxes 3,353 3,346 Accrued pension costs 1,161 1,257 Accrued postretirement health care costs 345 346 Other liabilities 2,383 2,302 TOTAL LIABILITIES 39,200 40,156 Commitments and Contingencies (Note 12) 0 0 EQUITY 0 0 Additional paid-in capital 32,009 32,070 Retained earnings 28,903 28,402 Accumulated other comprehensive losses (10,746) (10,690) (23,091) (22,204) Total Mondelēz International Shareholders’ Equity 27,075 27,578 Noncontrolling interest 74 76 TOTAL EQUITY 27,149 27,654 TOTAL LIABILITIES AND EQUITY $ 66,349 $ 67,810 Mondelēz International Shareholders’ Equity Common
Stock Additional
Paid-in
Capital Retained
Earnings Accumulated
Other
Comprehensive
Earnings/
(Losses) Treasury
Stock Noncontrolling
Interest* Total
Equity $ – $ 31,760 $ 20,700 $ (9,986 ) $ (14,462 ) $ 88 $ 28,100 – – 1,659 – – 10 1,669 – – – (1,136 ) – (17 ) (1,153 ) – 87 (94 ) – 350 – 343 – – – – (2,601 ) – (2,601 ) – – (1,116 ) – – – (1,116 ) – – – – – (27 ) (27 ) $ – $ 31,847 $ 21,149 $ (11,122 ) $ (16,713 ) $ 54 $ 25,215 – – 2,120 – – 6 2,126 – – – 1,205 – 24 1,229 – 39 (63 ) – 296 – 272 – – – – (1,817 ) – (1,817 ) – – (910 ) – – – (910 ) – – – – – (16 ) (16 ) $ – $ 31,886 $ 22,296 $ (9,917 ) $ (18,234 ) $ 68 $ 26,099 *Noncontrolling interest as of September 30, 2016 was $68 million, as compared to $88 million as of January 1, 2016. The change of $(20) million during the nine months ended September 30, 2016 was due to $(27) million of dividends paid, $(3) million of other comprehensive losses, net of taxes offset by $10 million of net earnings. Mondelēz International Shareholders’ Equity Common
StockAdditional
Paid-in
CapitalRetained
EarningsAccumulated
Other
Comprehensive
Earnings/
(Losses)Treasury
StockNon-controlling
InterestTotal
EquityThree Months Ended March 31, 2021 Balances at January 1, 2021 $ 0 $ 32,070 $ 28,402 $ (10,690) $ (22,204) $ 76 $ 27,654 Comprehensive earnings/(losses): Net earnings — — 961 — — 7 968 — — — (56) — (9) (65) — (61) (15) — 130 — 54 Common Stock repurchased — — — — (1,017) — (1,017) Cash dividends declared ($0.315 per share) — — (445) — — — (445) — — — — — — 0 Balances at March 31, 2021 $ 0 $ 32,009 $ 28,903 $ (10,746) $ (23,091) $ 74 $ 27,149 Three Months Ended March 31, 2020 Balances at January 1, 2020 $ 0 $ 32,019 $ 26,615 $ (10,254) $ (21,139) $ 76 $ 27,317 Comprehensive earnings/(losses): Net earnings — — 736 — — 7 743 — — — (1,248) — (5) (1,253) — (29) (38) — 188 — 121 Common Stock repurchased — — — — (701) — (701) Cash dividends declared ($0.285 per share) — — (408) — — — (408) — — 1 — — — 1 Balances at March 31, 2020 $ 0 $ 31,990 $ 26,906 $ (11,502) $ (21,652) $ 78 $ 25,820 For the Nine Months Ended September 30, 2017 2016 $ 2,126 $ 1,576 604 615 104 102 77 (163 ) 287 262 11 – – (43 ) (184 ) – (236 ) (218 ) 143 75 (238 ) 10 (387 ) (265 ) (236 ) (121 ) (426 ) (143 ) 68 79 (604 ) (266 ) (312 ) (362 ) 797 1,138 (721 ) (909 ) 516 – – 275 77 113 (128 ) (521 ) 1,375 1,028 (1,681 ) (337 ) 2,266 1,533 350 1,149 (1,468 ) (1,757 ) (1,786 ) (1,727 ) (869 ) (801 ) 165 82 (1,648 ) (830 ) 82 29 (897 ) (184 ) 1,741 1,870 $ 844 $ 1,686 For the Three Months Ended
March 31, 2021 2020 CASH PROVIDED BY/(USED IN) OPERATING ACTIVITIES Net earnings $ 968 $ 743 Adjustments to reconcile net earnings to operating cash flows: Depreciation and amortization 284 256 Stock-based compensation expense 25 28 Deferred income tax provision/(benefit) 34 (26) Asset impairments and accelerated depreciation 43 0 Loss on early extinguishment of debt 110 0 Gain on acquisition (9) 0 Loss/(gain) on equity method investment transactions 7 (71) Equity method investment net earnings (78) (121) Distributions from equity method investments 74 165 Other non-cash items, net (23) 126 Change in assets and liabilities, net of acquisitions: Receivables, net (494) (610) Inventories, net (37) (48) Accounts payable 283 206 Other current assets (140) (217) Other current liabilities (55) (71) Change in pension and postretirement assets and liabilities, net (77) (76) Net cash provided by operating activities 915 284 CASH PROVIDED BY/(USED IN) INVESTING ACTIVITIES Capital expenditures (216) (214) Acquisitions, net of cash received (490) 0 Proceeds from divestitures including equity method investments 0 185 Other 16 (26) Net cash used in investing activities (690) (55) CASH PROVIDED BY/(USED IN) FINANCING ACTIVITIES Issuances of commercial paper, maturities greater than 90 days 0 157 Repayments of commercial paper, maturities greater than 90 days 0 (497) Net issuances of other short-term borrowings 647 2,477 Long-term debt proceeds 2,373 0 Long-term debt repaid (3,353) (670) Repurchase of Common Stock (1,046) (720) Dividends paid (453) (409) Other 51 117 Net cash (used in)/provided by financing activities (1,781) 455 Effect of exchange rate changes on cash, cash equivalents and
restricted cash(35) (60) Cash, cash equivalents and restricted cash: (Decrease)/Increase (1,591) 624 Balance at beginning of period 3,650 1,328 Balance at end of period $ 2,059 $ 1,952 2016.subsidiaries. As ofsubsidiaries that were deconsolidated in 2015. All intercompany transactions are eliminated. The noncontrolling interest represents the close of the 2015 fiscal year, we deconsolidated and changed to the cost method of accounting for our Venezuelan operations. As such, for all periods presented, we have excludednoncontrolling investors' interests in the results of operations, financial positionsubsidiaries that we control and consolidate. We account for investments over which we exercise significant influence under the equity method of accounting. Investments over which we do not have significant influence or control are not material and as there are no readily determinable fair values for the equity interests, these investments are carried at cost with changes in the investment recognized to the extent cash flows of our Venezuelan subsidiaries from our condensed consolidated financial statements.Segment Change:On October 1, 2016, we integrated our Eastern Europe, Middle East, and Africa (“EEMEA”) operating segment into our Europe and Asia Pacific operating segments to further leverage and optimize the operating scale built within the Europe and Asia Pacific regions. Russia, Ukraine, Turkey, Belarus, Georgia and Kazakhstan were combined within our Europe region, while the remaining Middle East and African countries were combined within our Asia Pacific region to form a new Asia, Middle East and Africa (“AMEA”) operating segment. We have reflected the segment change as if it had occurred in all periods presented.As of October 1, 2016, our operations and management structure were organized into four reportable operating segments:Latin Americais received.AMEAEuropeNorth AmericaSee Note 15,Segment Reporting, for additional information on our segments.of September 30, 2017, none of our consolidated subsidiaries were subjectdiscussed below, beginning on July 1, 2018, we began to apply highly inflationary accounting.We continue to closely monitorand the potential for the economy to becomerate exceeded 100%, we concluded that Argentina became a highly inflationary economy for accounting purposes. As of September 30, 2017,July 1, 2018, we began to apply highly inflationary accounting for our Argentinean subsidiaries and changed their functional currency from the Argentinian economy was not designatedArgentinean peso to the U.S. dollar. On July 1, 2018, both monetary and non-monetary assets and liabilities denominated in Argentinean pesos were remeasured into U.S. dollars using the exchange rate as highly inflationary. At this time, we continue to record currency translation adjustments within equityof the balance sheet date, with remeasurement and realized exchangeother transaction gains and losses on transactionsrecorded in net earnings. As of March 31, 2021, our Argentinean operations had $5 million of Argentinean peso denominated net monetary assets. Our ArgentinianArgentinean operations contributed $152$89 million, or 2.3%1.2% of consolidated net revenues in the three months ended March 31, 2021. Within selling, general and $454administrative expenses, we recorded a remeasurement loss of $5 million during the three months ended March 31, 2021 as well as a remeasurement loss of $2 million during the three months ended March 31, 2020 related to the revaluation of the Argentinean peso denominated net monetary position over these periods.2.4%quotas on trade between the U.K. and E.U. subject to prescribed trade terms. We also need to meet product and labeling standards for both the U.K. and E.U. Cross-border trade between the U.K. and E.U. is now subject to new customs regulations, documentation and reviews. To comply with the new requirements, we increased resources in customer service and logistics, in our factories, and on our customs support teams. We adapted our processes and systems for the new and increased number of customs transactions. We continue to closely monitor and manage our inventory levels of imported raw materials, packaging and finished goods in the U.K. If the U.K.’s separation from, or new trade arrangements with, the E.U. negatively impact the U.K. economy or result in disagreements on trade terms, delays affecting our supply chain or distribution, or disruptionsnine months ended September 30, 2017, and our Argentinian operations had a net monetary liability position as of September 30, 2017.Ukraine. Beginning in the second quarter of 2017, based on projected inflation data published by the National Bank of Ukraine, Ukraine’s three-year cumulative inflation rate dropped below 100% and it is projected to stay below 100% for the rest of the year. As such, Ukraine is no longer designated highly inflationary and we continue to record currency translation adjustments within equity and realized exchange gains and losses on transactions in earnings. Our Ukrainian operations contributed $21 million, or 0.3%, of consolidated net revenues in the three months and $51 million, or 0.3% of consolidated net revenues in the nine months ended September 30, 2017, and our Ukrainian net monetary assets as of September 30, 2017 were not material.approximately 165over 150 countries and have operations in overapproximately 80 countries, we monitor economic and currency-related risks and seek to take protective measures in response to thesepotential exposures. SomeWe continue to monitor the ongoing COVID-19 global pandemic and related impacts to our business operations, currencies and net monetary exposures. Since the global onset of theCOVID-19 in early 2020, most countries in which we do business have recently experienced periods of significant economic uncertainty. These include Brazil, China, Mexico, Russia, United Kingdom (Brexit), Turkey, Egypt, Nigeria and South Africa, most of which have haduncertainty as well as exchange rate volatility. We continue to monitor operations, currencies and net monetary exposures in these countries. At this time, except for Argentina which is accounted for as a highly inflationary economy, we do not anticipate aany other countries in which we operate to be at risk to our operating results from changing toof becoming highly inflationary accountingcountries.these countries.Allowance for Trade Receivables Allowance for Other Current Receivables Allowance for Long-Term Receivables (in millions) Balance at January 1, 2021 $ (42) $ (42) $ (12) Current period provision for expected credit losses (2) 0 0 Write-offs charged against the allowance 1 1 0 Currency 3 0 1 Balance at March 31, 2021 $ (40) $ (41) $ (11) anon-recourse factoring arrangement with a major global bank for a maximum combined capacity of $1.0 billion. Under the program,arrangements in which we may sell eligible short-term trade receivables primarily to the bankbanks in exchange for cash. We may then continue to collect the receivables sold, acting solely as a collecting agent on behalf of the bank.banks. The outstanding principal amount of receivables under this arrangementthese arrangements amounted to $650$905 million as of September 30, 2017March 31, 2021 and $644$760 million as of December 31, 2016.2020. The incremental cost of factoring receivables under this arrangement was not material for all periods presented. The proceeds from the sales of receivables are included in cash from operating activities in the condensed consolidated statements of cash flows.August 2017,December 2019, the Financial Accounting Standards Board (“FASB”("FASB") issued an Accounting Standards Update (“ASU”("ASU") to better align hedgethat removes certain exceptions in accounting with an entity’s risk management activitiesfor income taxes, improves consistency in application and improve disclosures surrounding hedging. For cash flow and net investment hedges as2018,2020, with early adoption permitted. We are currently assessing the impact on our consolidated financial statements.In May 2017, the FASB issued an ASU to clarify when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. The ASU is applied prospectively to awards that are modified on or after the adoption date. The ASU is effective for fiscal years beginning after December 15, 2017, with early adoption permitted. We do not anticipate a material impact to our consolidated financial statements.In March 2017, the FASB issued an ASU to amend the amortization period for certain purchased callable debt securities held at a premium, shortening the period to the earliest call date instead of the maturity date. The standard does not impact securities held at a discount as the discount continues to be amortized to maturity. The ASU is applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. The ASU is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. We do not anticipate a material impact to our consolidated financial statements.In March 2017, the FASB issued an ASU to improve the presentation of net periodic pension cost and net periodic postretirement benefit cost. The standard requires employers to disaggregate the service cost component from the other components of net benefit cost and disclose the amount and location where the net benefit cost is recorded in the income statement or capitalized in assets. The standard is to be applied on a retrospective basis for the change in presentation in the income statement and prospectively for the change in presentation on the balance sheet. The ASU is effective for fiscal years beginning after December 15, 2017, with early adoption permitted. We will adopt the standard onOn January 1, 2018. For information on our service cost2021, we adopted this ASU and other components of net periodic benefit cost for pension, postretirement benefit and post-employment plans, see Note 9,Benefit Plans, in this Form 10-Q and Note 9,Benefit Plans, to our consolidated financial statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2016.In January 2017, the FASB issued an ASU that clarifies the definition of a business with the objective of adding guidance to assist companies with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The definition of a business may affect many areas of accounting including acquisitions, disposals, goodwill and consolidation. The ASU is applied on a prospective basis and is effective for fiscal years beginning after December 15, 2017, with early adoption permitted. We continue to assess the ASU based on any pending or new transactions that may arise prior to the January 1, 2018 adoption date. At this time, we doit did not anticipate early adopting nor a material impact on our consolidated financial statements.In November 2016, the FASB issued an ASU that requires the change in restricted cash or cash equivalents to be included with other changes in cash and cash equivalents in the statement of cash flows. The ASU is effective for fiscal years beginning after December 15, 2017, with early adoption permitted. We anticipate adopting this standard at the same time as the cash flow statement classification changes described below go into effect on January 1, 2018. This ASU is not expected to have a material impact on our consolidated statement of cash flows.In October 2016, the FASB issued an ASU that requires the recognition of tax consequences of intercompany asset transfers other than inventory when the transfer occurs and removes the exception to postpone recognition until the asset has been sold to an outside party. The standard is to be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings. The ASU is effective for fiscal years beginning after December 15, 2017, with early adoption permitted. We anticipate adopting on January 1, 2018 and do not expect the ASU to have a material impact on our consolidated financial statements.In August 2016, the FASB issued an ASU to provide guidance on eight specific cash flow classification issues and reduce diversity in practice in how some cash receipts and cash payments are presented and classified in the statement of cash flows. The ASU is effective for fiscal years beginning after December 15, 2017, with early adoption permitted. We anticipate adopting this standard on January 1, 2018. This ASU is not expected to have a material impact on our consolidated financial statements.In February 2016, the FASB issued an ASU on lease accounting. The ASU revises existing U.S. GAAP and outlines a new model for lessors and lessees to use in accounting for lease contracts. The guidance requires lessees to recognize a right-of-use asset and a lease liability on the balance sheet for all leases, with the exception of short-term leases. In the statement of earnings, lessees will classify leases as either operating (resulting in straight-line expense) or financing (resulting in a front-loaded expense pattern). The ASU is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. We anticipate adopting the new standard on January 1, 2019. We continue to make progress in our due diligence and assess the impact of the new standard across our operations and on our consolidated financial statements, which will consist primarily of recording lease assets and liabilities on our balance sheet for our operating leases.In January 2016, the FASB issued an ASU that provides updated guidance for the recognition, measurement, presentation and disclosure of financial assets and liabilities. The standard requires that equity investments (other than those accounted for under equity method of accounting or those that result in consolidation of the investee) be measured at fair value, with changes in fair value recognized in net income. The standard also impacts financial liabilities under the fair value option and the presentation and disclosure requirements for financial instruments. The ASU is effective for fiscal years beginning after December 15, 2017. This ASU is not expected to have a material impact on our consolidated financial statements.In May 2014, the FASB issued an ASU on revenue recognition from contracts with customers. The ASU outlines a new, single comprehensive model for companies to use in accounting for revenue. The core principle is that an entity should recognize revenue to depict the transfer of control over promised goods or services to a customer in an amount that reflects the consideration the entity expects to be entitled to receive in exchange for the goods or services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows from customer contracts, including significant judgments made in recognizing revenue. In 2016 and early 2017, the FASB issued several ASUs that clarified principal versus agent (gross versus net) revenue presentation considerations, confirmed the accounting for certain prepaid stored-value products and clarified the guidance for identifying performance obligations within a contract, the accounting for licenses and partial sales of nonfinancial assets. The FASB also issued two ASUs providing technical corrections, narrow scope exceptions and practical expedients to clarify and improve the implementation of the new revenue recognition guidance. The revenue guidance is effective for annual reporting periods beginning after December 15, 2017, with early adoption permitted as of the original effective date (annual reporting periods beginning after December 15, 2016). The ASU may be applied retrospectively to historical periods presented or as a cumulative-effect adjustment as of the date of adoption. We plan to adopt the new standard on January 1, 2018 on a full retrospective basis. We are finalizing reviews and working on implementing the process, policy and disclosure changes that will go into effect on January 1, 2018. At this time, we do not expect a material financial impact from adopting the new revenue standards.In connection withDuring the October 1, 2016 segment change described above, prior-period segment information was updated to reflect the new segment structure. See Note 5,Goodwill and Intangible Assets; Note 6,2014-2018 Restructuring Program;and Note 15,Segment Reporting. We also reclassified certain amounts previously reported within our condensed consolidated statements of comprehensive earnings and Note 12,Reclassifications from Accumulated Other Comprehensive Income, to be consistent with the current-year presentation.Note 2. Divestitures and AcquisitionsJDE Coffee Business Transactions:On July 2, 2015, we completed transactions to combine our wholly owned coffee businesses with those of D.E Master Blenders 1753 B.V. (“DEMB”) to create a new company, Jacobs Douwe Egberts (“JDE”). Following the exchange of a portion of our investment in JDE for an interest in Keurig Green Mountain, Inc. (“Keurig”) in March 2016, we held a 26.5% equity interest in JDE. (See discussion underKeurig Transactionbelow.) The remaining 73.5% equity interest in JDE was held by a subsidiary of Acorn Holdings B.V. (“AHBV,” owner of DEMB prior to July 2, 2015). Following the transactions discussed underJDE Stock-Based Compensation Arrangementsbelow, as of September 30, 2017, we hold a 26.5% voting interest, a 26.4% ownership interest and a 26.2% profit and dividend sharing interest in JDE. We recorded $50 million of JDE equity earnings for three months and $88 million for the nine months ended September 30, 2017 and losses of $3 million for the three months and earnings of $89 million for the nine months ended September 30, 2016. We also recorded $49 million of cash dividends received during the firstsecond quarter of 2017.On July 5, 2016, we received an expected cash payment of $275 million from JDE to settle the receivable related to tax formation costs that were part of the initial sales price.On July 19, 2016, the Supreme Court of Spain reached a final resolution on a challenged JDE tax position held by a predecessor DEMB company that resulted in an unfavorable tax expense of€114 million. As a result, our share of JDE’s equity earnings during the third quarter of 2016 was negatively affected by€30 million ($34 million as of September 30, 2016).JDE Stock-Based Compensation Arrangements:On June 30, 2016, we entered into agreements with AHBV and its affiliates to establish a new stock-based compensation arrangement tied to the issuance of JDE equity compensation awards to JDE employees. This arrangement replaced a temporary equity compensation program tied to the issuance of AHBV equity compensation to JDE employees. New Class C, D and E JDE shares were authorized and issued for investments made by, and vested stock-based compensation awards granted to, JDE employees. Under these arrangements, share ownership dilution from the JDE Class C, D and E shareholders is limited to 2%. We retained our 26.5% voting rights and have a slightly lower portion of JDE’s profits and dividends than our shareholder ownership interest as certain employee shareholders receive a slightly larger share. Upon execution of the agreements and the creation of the Class C, D and E JDE shares, as a percentage of the total JDE issued shares, our Class B shares decreased from 26.5% to 26.4% and AHBV’s Class A shares decreased from 73.5% to 73.22%, while the Class C, D and E shares, held by AHBV and its affiliates until the JDE employee awards vest, comprised 0.38% of JDE’s shares. Additional Class C shares are available to be issued when planned long-term incentive plan (“JDE LTIP”) awards vest, generally over the next five years. When the JDE Class C shares are issued2020, in connection with the vested JDE LTIP awards, the Class APeet's (as defined below) transaction (refer to Note 6, B relative ownership interests will decrease. Based on estimated achievement and forfeiture assumptions, we do not expect our JDE ownership interest to decrease below 26.27%.Keurig Transaction:On March 3, 2016, a subsidiary of AHBV completed a $13.9 billion acquisition of all of the outstanding common stock of Keurig through a merger transaction. On March 7, 2016, we exchanged with a subsidiary of AHBV a portion of our equity interest in JDE with a carrying value of€1.7 billion (approximately $2.0 billion as of March 7, 2016) for an interest in Keurig with a fair value of $2.0 billion based on the merger consideration per share for Keurig. We recorded the difference between the fair value of Keurig and our basis in JDE shares as a $43 million gain on the equity method investment exchange in March 2016. Immediately following the exchange, our ownership interest in JDE was 26.5% and our interest in Keurig was 24.2%. Both AHBV and we hold our investments in Keurig through a combination of equity and interests in a shareholder loan, with pro-rata ownership of each. Our initial $2.0 billion investment in Keurig includes a $1.6 billion Keurig equity interest and a $0.4 billion shareholder loan receivable, which are reportedPeet's ongoing results on a combinedone-quarter lag basis within equity method investments on our condensed consolidated balance sheet aswhile we continue to record dividends when cash is received. This change was applied retrospectively to all periods presented.September 30, 2017. The shareholder loan has a 5.5% interest rate and is payable at the endapproximately $458 million Australian dollars ($348 million). We incurred acquisition-related costs of a seven-year term on February 27, 2023. We recorded Keurig equity earnings, shareholder loan interest and dividends of $25 million, $6 million and $5$1 million during the three months ended March 31, 2021.$54have recorded a preliminary purchase price allocation of $81 million to indefinite-lived intangible assets, $24 million to definite-lived intangible assets, $180 million to goodwill, $1 million to property, plant and equipment, $11 million to inventory, $18 million to accounts receivable, $1 million to other current assets, $25 million to current liabilities, $20 million to deferred tax liabilities and $11 million during the nine months ended September 30, 2017. In 2016, we recorded Keurig equity earnings, shareholder loan interest and dividendsto long-term other liabilities. We incurred acquisition-related costs of $10 million, $6 million and $2 million during the three months ended March 31, 2021.$39other categories in the well-being category. The initial cash consideration paid was $229 million, $14net of cash received, and the Company may be required to pay additional cash consideration. The estimated fair value of the contingent consideration obligation at the acquisition date was $132 million and $4 million duringwas determined using a Monte Carlo simulation based on forecasted future results. We are unable to provide a range of amounts that could be paid as contingent consideration as it is based primarily on revenue and gross margin of the sevenbusiness for the twelve months ended September 30, 2016.Other DivestituresDecember 31, 2022 and Acquisitions:On October 2, 2017,there is not a minimum or maximum payout. As a result of acquiring the remaining equity interest, we completedconsolidated the saleoperations prospectively from the date of one of our equity method investmentsacquisition and received cash proceeds of $65 million.In connection with the 2012 spin-off of Kraft Foods Group, Inc. (now a part of The Kraft Heinz Company (“KHC”)), Kraft Foods Group and we each granted the other various licenses to use certain trademarks in connection with particular product categories in specified jurisdictions. On August 17, 2017, we entered into two agreements with KHC to terminate the licenses of certain KHC-owned brands used in our grocery business within our Europe region and to transfer to KHC inventory and certain other assets. On August 17, 2017, the first transaction closed and we received cash proceeds of€9 million ($11 million as of August 17, 2017) and on October 23, 2017, the second transaction closed and we received cash proceeds of€3 million ($3 million as of October 23, 2017). The gain on both transactions combined is expected to be immaterial.On July 4, 2017, we completed the sale of most of our grocery business in Australia and New Zealand to Bega Cheese Limited for $456 million Australian dollars ($347 million as of July 4, 2017) and we expect to make a final working capital adjustment next quarter. We divested $27 million of current assets, $135 million of non-current assets and $4 million of current liabilities based on the July 4, 2017 exchange rate. We recorded a pre-tax gain of $247$9 million Australian dollars ($1877 million as of July 4, 2017) on the sale during the three months ended September 30, 2017. We incurred divestiture-related costs of $2 million in the six months ended June 30, 2017. We also had a gain on a foreign currency hedge of $2 million in the three months and a net loss of $3 million in the nine months ended September 30, 2017.On April 28, 2017, we completed the sale of several manufacturing facilities in France and the sale or license of several local confectionery brands. We received net cash of approximately€157 million ($169 million as of April 28, 2017), net of cash divested with the businesses. On April 28, 2017, we divested $44 million of current assets, $155 million of non-current assets,after-tax) related to stepping up our previously-held $8 million of current liabilities(7%) investment to fair value. We are working to complete the valuation and $22 million of non-current liabilities based on the April 28, 2017 exchange rate. Wehave recorded a $3 million loss on the sale during the three months ended June 30, 2017. We incurred divestiture-related costs of $1 million in the three months and $22 million in the nine months ended September 30, 2017 and no divestiture-related costs in the three months and $84 million in the nine months ended September 30, 2016. These costs were recorded within cost of sales and selling, general and administrative expenses of our Europe segment. In prior periods, we recorded a $5 million impairment charge in May 2016 for a candy trademark to reduce the overall net assets to the estimated net sales proceeds after transaction costs. On March 31, 2016, we recorded a $14 million impairment charge for another gum & candy trademark as a portion of its carrying value would not be recoverable based on future cash flows expected under a planned license agreement with the buyer.On November 2, 2016, we purchased from Burton’s Biscuit Company certain intangibles, which included the license to manufacture, market and sell Cadbury-branded biscuits in additional key markets around the world, including in the United Kingdom, France, Ireland, North America and Saudi Arabia. The transaction was accounted for as a business combination. Total cash paid for the acquired assets was £199 million ($245 million as of November 2, 2016). During the third quarter of 2017, we completed the valuation work and finalized thepreliminary purchase price allocation of $66$123 million to indefinite-lived intangible assets, $51 million to definite-lived intangible assets, $173$202 million to goodwill, $2$1 million to property, plant and equipment, and$2 million to inventory, $4 million to inventory, reflecting a November 2, 2016 exchange rate.On May 2, 2016, we completedaccounts receivable, $5 million to current liabilities and $132 million to long-term other liabilities. During the salethree months ended March 31, 2021, the acquisition added incremental net revenues of certain local biscuit brands in Finland as part of our strategic decision to exit select small and local brands and shift investment toward our Power Brands. The sales price was€14 million ($16 million as of May 2, 2016) and we divested $8 million and an operating loss of indefinite-lived$6 million. We incurred acquisition-related costs of $4 million during the three months ended March 31, 2021.less than $1liabilities assumed as follows:(in millions) Receivables $ 29 Inventory 38 Other current assets 6 Property, plant and equipment 136 Operating right of use assets 61 Definite-life intangible assets 511 Indefinite-life intangible assets 42 Goodwill 531 Assets acquired $ 1,354 Current liabilities 42 Deferred tax liabilities 92 Long-term operating lease liabilities 56 Long-term debt 6 Long-term other liabilities 19 Total purchase price $ 1,139 Less: cash received 3 Net Cash Paid $ 1,136 other assets. We received17 years. Goodwill arises principally as a result of expansion opportunities and synergies across both new and legacy product categories. NaN of the goodwill recognized is expected to be deductible for income tax purposes.proceedsflows, customer attrition rates and discount rates. The acquisition added incremental net revenues of€12 $106 million ($14 million as of May 2, 2016) upon closing and another€2 million ($2 million as of October 31, 2016) following the completion of post-closing requirements. The additional $2 million of consideration increased the pre-tax gainoperating income of $6 million recorded in the secondthree months ended March 31, 2021. During the first quarter of 2016 to a total 2016 pre-tax gain2020, we incurred $5 million of $8 million.Sales of Property:In the third quarter of 2016, we sold property in North America that generated cash proceeds of $10 million and a pre-tax gain of $6 million and we sold a corporate aircraft hangar that generated cash proceeds of $3 million and a pre-tax gain of $1 million. In the second quarter of 2016, we also sold property within our North America segment and from our centrally held corporate assets. The North America sale generated cash proceeds of $40 million and a pre-tax gain of $33 million. The corporate aircraft sale generated cash proceeds of $20 million and a pre-tax gain of $6 million. The gains were recorded within selling, general and administrative expenses and cash proceeds were recorded in cash flows from other investing activities in the nine months ended September 30, 2016. As of September 30, As of December 31, 2017 2016 (in millions) $ 764 $ 722 2,154 1,865 2,918 2,587 (137 ) (118 ) $ 2,781 $ 2,469 As of March 31, 2021 As of December 31, 2020 (in millions) Raw materials $ 766 $ 718 Finished product 1,990 2,059 2,756 2,777 Inventory reserves (121) (130) Inventories, net $ 2,635 $ 2,647 As As of March 31, 2021 As of December 31, 2020 (in millions) Land and land improvements $ 411 $ 422 Buildings and building improvements 3,196 3,252 Machinery and equipment 11,889 12,053 Construction in progress 616 628 16,112 16,355 Accumulated depreciation (7,346) (7,329) Property, plant and equipment, net $ 8,766 $ 9,026 September 30,As$216 million excluded $230 million of accrued capital expenditures remaining unpaid at March 31, 2021 and included payment for a portion of the $275 million of capital expenditures that were accrued and unpaid at December 31,20172016(in millions)Land 2020. For the three months ended March 31, 2020, capital expenditures of $214 million excluded $259 million of accrued capital expenditures remaining unpaid at March 31, 2020 and land improvements$469$471Buildingsincluded payment for a portion of the $334 million of capital expenditures that were accrued and building improvements2,9712,801Machinery and equipment11,17910,302Construction in progress1,0141,11315,63314,687Accumulated depreciation(7,095) (6,458) Property,unpaid at December 31, 2019.net$ 8,538$ 8,229For the nine months ended September 30, 2017, capital expenditures of $721 million excluded $220 million of accrued capital expenditures remaining unpaid at September 30, 2017 and included payment for a portion of the $343 million of capital expenditures that were accrued and unpaid at December 31, 2016. For the nine months ended September 30, 2016, capital expenditures of $909 million excluded $274 million of accrued capital expenditures remaining unpaid at September 30, 2016 and included payment for $322 million of capital expenditures that were accrued and unpaid at December 31, 2015.In connection with our restructuring program, we recorded non-cash asset write-downs (including accelerated depreciation and asset impairments) of $46 million in the three months and $164 million in the nine months ended September 30, 2017 and $120 million in the three months and $233 million in the nine months ended September 30, 2016 (see Note 6,2014-2018 Restructuring Program). These charges were recorded in the condensed consolidated statements of earnings within asset impairment and exit costs and in the segment results as follows: For the Three Months Ended For the Nine Months Ended September 30, September 30, 2017 2016 2017 2016 (in millions) $ 13 $ 3 $ 25 $ 16 20 9 62 30 10 49 52 87 3 59 25 98 – – – 2 $ 46 $ 120 $ 164 $ 233 For the Three Months Ended
March 31, 2021 2020 (in millions) Latin America $ 0 $ 0 AMEA (16) (1) Europe 2 1 North America 54 1 Total $ 40 $ 1 reflects our current segment structure for both periods presented: As of September 30, As of December 31, 2017 2016 (in millions) $ 947 $ 897 3,349 3,324 7,837 7,170 8,938 8,885 $ 21,071 $ 20,276 As of March 31, 2021 As of December 31, 2020 (in millions) Latin America $ 673 $ 706 AMEA 3,229 3,250 Europe 7,929 8,038 North America 10,114 9,901 Goodwill $ 21,945 $ 21,895 As of September 30, As of December 31, 2017 2016 (in millions) $ 17,625 $ 17,004 2,414 2,315 20,039 19,319 (1,401 ) (1,218 ) $ 18,638 $ 18,101 Non-amortizableAs of March 31, 2021 As of December 31, 2020 (in millions) Indefinite-life intangible assets $ 17,505 $ 17,492 Definite-life intangible assets 2,956 2,907 20,461 20,399 Accumulated amortization (1,934) (1,917) Intangible assets, net $ 18,527 $ 18,482 AmortizableDefinite-life intangible assets consist primarily of trademarks,brands, customer-related intangibles, process technology, licenses and non-compete agreements. At September 30, 2017, the weighted-average life of our amortizable intangible assets was 13.6 years.$45$38 million for the three months ended March 31, 2021 and $133 million for the nine months ended September 30, 2017 and $44$43 million for the three months and $132 million for the nine months ended September 30, 2016.March 31, 2020. For the next five years, we currently estimate annual amortization expense of approximately $180$130 million for the next four yearsin 2021, approximately $120 million in 2022-2024 and approximately $90$105 million in year five, reflecting September 30, 20172025 (reflecting March 31, 2021 exchange rates. Goodwill Intangible
Assets, at cost (in millions) $ 20,276 $ 19,319 889 898 (109 ) (62 ) 15 (7 ) – (109 ) $ 21,071 $ 20,039 Changes Goodwill Intangible
Assets, at cost (in millions) Balance at January 1, 2021 $ 21,895 $ 20,399 Currency (332) (217) Acquisitions 382 279 Balance at March 31, 2021 $ 21,945 $ 20,461 intangibles were:•Divestitures – During 2017, we divested several manufacturing facilities, primarily in France, and as a result of the divestiture, $23 million of goodwill and $62 million of amortizable and non-amortizable intangible assets. In the third quarter, we also completed a sale of most of our grocery business in Australia and New Zealand resulting in a goodwill decrease of $86 million. See Note 2,Divestitures and Acquisitions, for additional information.•Acquisition – During 2017, we recorded a $15 million adjustment to goodwill and a $7 million adjustment to indefinite lived assets in connection with finalizing the valuation and purchase price allocation for the Burton’s Biscuit Company purchase completed in the fourth quarter of 2016. See Note 2,Divestitures and Acquisitions, for additional information.Asset impairments – third quarterfirst quarters of 2017,2021 and 2020, we recorded $70 million of intangible asset impairments related toevaluated our annual testing of non-amortizable intangible assets as described further below and a $1 million impairment related to a transaction. During the second quarter of 2017, we recorded a $38 million intangible asset impairment charge resulting from a category decline and lower than expected product growth related to a gum trademark in our North America segment.We have historically annually tested goodwill and non-amortizable intangible assets for impairment as of October 1. This year, we voluntarily changed the annual impairment assessment date from October 1 to July 1. We believe this measurement date, which represents a change in the method of applying an accounting principle, is preferable because it better aligns with our strategic business planning process and financial forecasts which are key components of the annual impairment tests. The change in the measurement date did not delay, accelerate or prevent an impairment charge. Each quarter, we have evaluated goodwill and intangible asset impairment risksrisk through an assessment of potential triggering events. In light of the ongoing COVID-19 global pandemic, we considered qualitative and recognized any related impairments to date. As such,quantitative information in our assessment over indefinite-life intangible assets. Based on the change in the annual test date was applied on July 1, 2017.As partfinancial performance of our goodwill quantitative annual impairment testing, we compare a reporting unit’s estimatedunits and intangible assets and review of other significant fair value with its carrying valueassumptions, we concluded that no impairment indicators were present that would require a full impairment assessment. We will continue to evaluatemonitor the potential for asset impairment risk over coming quarters.potential goodwill impairment. We estimate a reporting unit’s fair value using a discounted cash flow method which incorporates planned growth rates, market-based discount rates and estimates of residual value. This year, for our Europe and North America reporting units, we used a market-based, weighted-average cost of capital of 7.2%intangible asset impairment charges related to discount the projected cash flows of those operations. For our Latin America and AMEA reporting units, we used a risk-rated discount rate of 10.2%. Estimating the fair value of individual reporting units requires us to make assumptions and estimates regarding our future plans and industry and economic conditions, and our actual results and conditions may differ over time. If the carrying value of a reporting unit’s net assets exceeds its fair value, we would record an impairment based on the difference between the carrying value and fair value8brands. The ongoing impact of the reporting unit.In 2017COVID-19 pandemic resulted in greater declines in the sales and 2016, there were no goodwill impairments and each ofearnings for certain brands, particularly our reporting units had sufficient fair value in excess of its carrying value. While all reporting units passedgum brands. During our annual impairment testing if planned business performance expectations are not met or specific valuation factors outsideas of our control, such as discount rates, change significantly, then the estimated fair values of a reporting unit or reporting units might decline and lead to a goodwill impairment in the future.During our 2017 annual testing of non-amortizable intangible assets,July 1, 2020, we recorded $70 million of impairment charges in the third quarter of 2017 related to five trademarks. The impairments arose due to lower than expected product growth in part driven by decisions to redirect support from these trademarks to other regional and global brands. We recorded charges related to candy and gum trademarks of $52 million in AMEA, $11 million in Europe, $5 million in Latin America and $2 million in North America. The impairment charges were calculated as the excess of the carrying value over the estimated fair value of the intangible assets on a global basis and were recorded within asset impairment and exit costs. We primarily use a relief of royalty valuation method, which utilizes estimates of future sales, growth rates, royalty rates and discount rates in determining a brand’s global fair value. We also noted thirteenidentified 9 brands, including the five8 impaired trademarks, with $965 million of aggregate book value as of September 30, 2017brands, that each had a fair value in excess of book value of 10% or less. We believe our current plans for eachThe aggregate book value of thesethe 9 brands will allow them towas $738 million as of March 31, 2021. We continue to not be impaired, but ifmonitor our brand performance, particularly in light of the product linesignificant uncertainty due to the COVID-19 pandemic and related impacts to our business. If the brand earnings expectations, including the timing of the expected recovery from the COVID-19 pandemic impacts, are not met or specific valuation factors outside of our control, such as discount rates, change significantly, then a brand or brands could become impaired in the future.2014-2018Equity Method InvestmentsFor the Three Months Ended
March 31, 2020As Reported As Recast (in millions, except per share data) Statements of Earnings Equity method investment net earnings $ 138 $ 121 Net earnings 760 743 Net earnings attributable to
Mondelēz International753 736 Earnings per share attributable to
Mondelēz International:Basic EPS $ 0.53 $ 0.51 Diluted EPS $ 0.52 $ 0.51 Statements of Other Comprehensive Earnings Currency translation adjustment $ (1,511) $ (1,371) Pension and other benefit plans 79 60 Derivative cash flow hedges 60 58 Total other comprehensive earnings/(losses) (1,372) (1,253) Comprehensive earnings/(losses) attributable to
Mondelēz International(614) (512) that now the $5.7 billion program consistsconsisted of approximately $4.1 billion of restructuring program costscharges ($3.1 billion cash costs and $1$1.0 billion non-cash costs) and up to $1.6 billion of capital expenditures. On September 6, 2018, our Board of Directors approved an extension of the restructuring program through 2022, an increase of $1.3 billion in the program charges and an increase of $700 million in capital expenditures. The total $7.7 billion program now consists of $5.4 billion of program charges ($4.1 billion of cash costs and $1.3 billion of non-cash costs) and total capital expenditures of $2.3 billion to be incurred over the life of the program. The current restructuring program, as increased and extended by these actions, is now called the Simplify to Grow Program.2014-2018 RestructuringSimplify to Grow Program is to reduce our operating cost structure in both our supply chain and overhead costs. The program is intended primarily to covercovers severance as well as asset disposals and other manufacturing-relatedmanufacturing and procurement-related one-time costs. Since inception, we have incurred total restructuring and related implementation charges of $3.1$4.8 billion related to the 2014-2018 RestructuringSimplify to Grow Program. We expect to incur the full $4.1 billionremainder of the program charges by year-end 2018. Severance
and related
costsAsset
Write-downsTotal (in millions) Liability balance, January 1, 2021 $ 304 $ 0 $ 304 Charges 47 41 88 Cash spent (34) 0 (34) Non-cash settlements/adjustments 1 (41) (40) Currency (10) 0 (10) Liability balance, March 31, 2021 $ 308 $ 0 $ 308 $113$88 million in the three monthsfirst quarter of 2021 and $418$15 million in the nine months ended September 30, 2017 and $187 million in the three months and $480 million in the nine months ended September 30, 2016first quarter of 2020 within asset impairment and exit costs. The 2014-2018 Restructuring Program liability activity for the nine months ended September 30, 2017 was: Severance
and related
costs Asset
Write-downs Total (in millions) $ 464 $ – $ 464 250 168 418 (245 ) – (245 ) (6 ) (168 ) (174 ) 30 – 30 $ 493 $ – $ 493 $83$34 million in the three monthsfirst quarter of 2021 and $245$37 million in the nine months ended September 30, 2017 and $89 million in the three months and $249 million in the nine months ended September 30, 2016first quarter of 2020 in cash severance and related costs.also recognized non-cash pension settlement losses (See Note 9,Benefit Plans), non-cash asset write-downs (including accelerated depreciation and asset impairments) and other non-cash adjustments, totaling $48including any gains on sale of restructuring program assets, which totaled $40 million in the three monthsfirst quarter of 2021 and $174$3 million in the nine months ended September 30, 2017 and $120 million in the three months and $244 million in the nine months ended September 30, 2016. first quarter of 2020.September 30, 2017, $431March 31, 2021, $261 million of our net restructuring liability was recorded within other current liabilities and $62$47 million was recorded within other long-term liabilities.2014-2018 RestructuringSimplify to Grow Program. Implementation costs primarily relate to reorganizing our operations and facilities in connection with our supply chain reinvention program and other identified productivity and cost saving initiatives. The costs include incremental expenses related to the closure of facilities, costs to terminate certain contracts and the simplification of our information systems. Within our continuing results of operations, we recorded implementation costs of $62$34 million in the three monthsfirst quarter of 2021 and $179$43 million in the nine months ended September 30, 2017 and $114 million in the three months and $286 million in the nine months ended September 30, 2016.first quarter of 2020. We recorded these costs within cost of sales and general corporate expense within selling, general and administrative expenses.Costs in Operating Income:and nine months ended September 30, 2017March 31, 2021 and September 30, 2016,March 31, 2020, and since inception of the 2014-2018 RestructuringSimplify to Grow Program, we recorded the following restructuring and implementation costs within segment operating income by segment (as revised to reflect our current segment structure) as follows: Latin North America AMEA Europe America (1) Corporate (2) Total (in millions)
September 30, 2017 $ 45 $ 32 $ 30 $ 7 $ (1 ) $ 113 8 11 18 13 12 62 $ 53 $ 43 $ 48 $ 20 $ 11 $ 175
September 30, 2017 $ 76 $ 106 $ 149 $ 79 $ 8 $ 418 28 30 49 38 34 179 $ 104 $ 136 $ 198 $ 117 $ 42 $ 597
September 30, 2016 $ 27 $ 9 $ 76 $ 75 $ – $ 187 15 9 45 30 15 114 $ 42 $ 18 $ 121 $ 105 $ 15 $ 301
September 30, 2016 $ 71 $ 72 $ 188 $ 144 $ 5 $ 480 34 27 78 101 46 286 $ 105 $ 99 $ 266 $ 245 $ 51 $ 766 $ 413 $ 413 $ 798 $ 433 $ 60 $ 2,117 137 116 253 233 209 948 $ 550 $ 529 $ 1,051 $ 666 $ 269 $ 3,065 (1)During 2017 and 2016, our North America region implementation costs included incremental costs that we incurred related to re-negotiating collective bargaining agreements that expired at the end of February 2016 for eight U.S. facilities and related to executing business continuity plans for the North America business.(2)Includes adjustment for rounding.
and earnings before income taxes:(3)Includes all charges recorded since program inception on May 6, 2014 through September 30, 2017.Latin
AmericaAMEA Europe North
AmericaCorporate Total (in millions) For the Three Months Ended March 31, 2021 Restructuring Costs $ 3 $ (21) $ 6 $ 101 $ (1) $ 88 Implementation Costs 3 2 10 10 9 34 Total $ 6 $ (19) $ 16 $ 111 $ 8 $ 122 For the Three Months Ended March 31, 2020 Restructuring Costs $ 4 $ (1) $ 3 $ 2 $ 7 $ 15 Implementation Costs 7 3 14 10 9 43 Total $ 11 $ 2 $ 17 $ 12 $ 16 $ 58 Restructuring Costs $ 550 $ 537 $ 1,149 $ 593 $ 141 $ 2,970 Implementation Costs 290 231 521 466 347 1,855 Total $ 840 $ 768 $ 1,670 $ 1,059 $ 488 $ 4,825 7.8. Debt and Borrowing Arrangements As of September 30, 2017 As of December 31, 2016 Amount Weighted- Amount Weighted- Outstanding Average Rate Outstanding Average Rate (in millions) (in millions) $ 4,370 1.3% $ 2,371 1.0% 181 10.6% 160 10.6% $ 4,551 $ 2,531 As of March 31, 2021 As of December 31, 2020 Amount
OutstandingWeighted-
Average RateAmount
OutstandingWeighted-
Average Rate(in millions, except percentages) Commercial paper $ 584 0.2 % $ 0 0 % Bank loans 90 5.0 % 29 4.8 % Total short-term borrowings $ 674 $ 29 September 30, 2017,March 31, 2021, commercial paper issued and outstanding had between 26 and 6615 days remaining to maturity. Commercial paper borrowings since year end increased since year-end primarily as a result of issuances to help finance the payment of long-term debt maturities, dividend payments andredemption, share repurchases during the year.Some of our international subsidiaries maintain primarilyand dividend payments.to meet short-term working capital needs. Collectively, theseand committed credit lines amounted to $1.9 billion at September 30, 2017available as of March 31, 2021 and $1.8 billion at December 31, 2016. Borrowings on these lines were $181 million at September 30, 2017 and $160 million at December 31, 2016.Borrowing Arrangements:On March 1, 2017, to supplement our commercial paper program, we entered into a $1.5 billion revolving credit agreement for a 364-day senior unsecured credit facility that is scheduled to expire on February 28, 2018. The agreement includes the same terms and conditions as our existing $4.5 billion multi-year credit facility discussed below. As of September 30, 2017, no amounts were drawn on the facility. As of March 31, 2021 As of December 31, 2020 Facility Amount Borrowed Amount Facility Amount Borrowed Amount (in millions) Uncommitted credit facilities $ 1,488 $ 90 $ 1,487 $ 29 February 24, 2021 0 0 1,500 0 February 23, 2022 2,500 0 0 0 February 27, 2024 4,500 0 4,500 0 also maintain a $4.5 billion multi-year senior unsecured revolving credit facility for general corporate purposes, including working capital needs, and to support our commercial paper program. On October 14, 2016, the revolving credit agreement, which was scheduled to expire on October 11, 2018, was extended through October 11, 2021. The revolving credit agreement includes a covenant that we maintain a minimum shareholders’shareholders' equity of at least $24.6 billion, excluding accumulated other comprehensive earnings/(losses) and, the cumulative effects of any changes inprinciples.principles and earnings/(losses) recognized in connection with the ongoing application of any mark-to-market accounting for pensions and other retirement plans. At September 30, 2017,March 31, 2021, we complied with this covenant as our shareholders’shareholders' equity, as defined by the covenant, was $35.9$37.8 billion. The revolving credit facility agreement also contains customary representations, covenants and events of default. There are no credit rating triggers, provisions or other financial covenants that could require us to post collateral as security. AsSeptember 30, 2017, noEuro and U.S. dollar denominated notes for the following amounts were drawn on the facility.Long-Term Debt:On April 12, 2017, we discharged $488(in millions):Interest Rate Maturity Date Amount Redeemed USD Equivalent 1.000% March 2022 €500 $587 1.625% January 2023 €700 $821 2.125% April 2023 $500 $500 4.000% February 2024 $492 $492 our 6.500% U.S. dollar-denominated debt. We paid $504 million, representing principal as well as pastextinguishment loss and future interest accruals from February 2017 through the August 2017 maturity date. We recorded an $11 million loss on debt extinguishmentdebt-related expenses within interest and other expense, net related to $110 million paid in excess of carrying value of the debt and a $5recognizing unamortized discounts and deferred financing in earnings and $27 million reductionforeign currency derivative loss related to the redemption payment at the time of the debt extinguishment. The cash payments related to the redemption were classified as cash outflows from financing activities in accrued interest.Onthe consolidated statement of cash flows.30, 2017,fr.175 million of our 0.000% Swiss franc-denominated31, 2021, we repaid the following notes matured. Theor term loans (in millions):Interest Rate Maturity Date Amount USD Equivalent 2.375% January 2021 €679 $827 and accrued interest to date were paid with net(in millions):Issuance Date Interest Rate Maturity Date Gross Proceeds USD Equivalent March 2021 1.375% March 2041 €650 $777 March 2021 0.750% March 2033 €600 $717 March 2021 0.250% March 2028 €750 $896 thefr.350 million Swiss franc-denominated notes issued on March 13, 2017.On March 13, 2017, we launched an offering offr.350 million of Swiss franc-denominated notes, or $349 million in U.S. dollars as of March 31, 2017, consisting of:•fr.225 million (or $224 million) of 0.050% fixed rate notes that mature on March 30, 2020•fr.125 million (or $125 million) of 0.617% fixed rate notes that mature on September 30, 2024On March 30, 2017, we received net proceeds offr.349 million (or $349 million) that were used for general corporate purposes.On January 26, 2017,€750 million of our 1.125% euro-denominated notes matured. The notes and accrued interest to date were paid with the issuance of commercial papernotes excluding debt issuance costs, discounts and cash on hand.Our weighted-average interest rate on our total debt was 2.0% as of September 30, 2017 and 2.2% as of December 31, 2016, down from 3.7% as of December 31, 2015.September 30, 2017March 31, 2021 and December 31, 20162020 reflects current market interest rates and approximates the amounts we have recorded on our condensed consolidated balance sheets. The fair value of our long-term debt was determined using quoted prices in active markets (Level 1 valuation data) for the publicly traded debt obligations. At September 30, 2017, the aggregate fair value As of March 31, 2021 As of December 31, 2020 (in millions) Fair Value $ 20,203 $ 21,568 Carrying Value $ 19,530 $ 20,046 within our results of continuing operations consisted of: For the Three Months Ended For the Nine Months Ended September 30, September 30, 2017 2016 2017 2016 (in millions) $ 89 $ 129 $ 295 $ 400 – – 11 – – – – 97 (70 ) 16 (44 ) 43 $ 19 $ 145 $ 262 $ 540 See Note 8,Financial Instruments, for information on the lossFor the Three Months Ended
March 31, 2021 2020 (in millions) Interest expense, debt $ 98 $ 110 Loss on debt extinguishment and related expenses 137 0 Loss related to interest rate swaps 0 103 Other (income)/expense, net (17) (23) Interest and other expense, net $ 218 $ 190 U.S. dollar interest rate swaps no longer designated as accounting cash flow hedges duringour net investment hedge derivative contracts that totaled $20 million in the first quarter of 2016. See Note 11,Commitmentsthree months ended March 31, 2021 and Contingencies, for information on$33 million in the $59 million of other income recorded in connection with the resolution of a Brazilian indirect tax matter and the reversal of related accrued interest.three months ended March 31, 2020.8.9. Financial Instruments As of September 30, 2017 As of December 31, 2016 Asset Liability Asset Liability Derivatives Derivatives Derivatives Derivatives (in millions)
accounting hedges: $ – $ 2 $ 19 $ 8 1 – 17 22 33 421 108 19 $ 34 $ 423 $ 144 $ 49
as accounting hedges: $ 70 $ 45 $ 29 $ 43 35 169 112 167 15 10 27 19 $ 120 $ 224 $ 168 $ 229 $ 154 $ 647 $ 312 $ 278 Derivatives designated as accounting hedges include cash flow As of March 31, 2021 As of December 31, 2020 Asset
DerivativesLiability
DerivativesAsset
DerivativesLiability
Derivatives (in millions) Interest rate contracts $ 13 $ 193 $ 12 $ 340 118 58 114 129 $ 131 $ 251 $ 126 $ 469 Derivatives not designated as
accounting hedges:Currency exchange contracts $ 141 $ 73 $ 134 $ 119 Commodity contracts 249 104 205 128 $ 390 $ 177 $ 339 $ 247 Total fair value $ 521 $ 428 $ 465 $ 716 fair value hedges and derivatives not designated as accounting hedges include economic hedges. Non-U.S.options. We also designate some of our non-U.S. dollar denominated debt designated asto hedge a hedgeportion of our net investments in our non-U.S. operations,operations. This debt is not reflected in the table above, but is included in long-term debt summarizeddiscussed in Note 7,8, Debt and Borrowing Arrangements. Both net investment hedge derivative contracts and non-U.S. dollar denominated debt acting as net investment hedges are also disclosed in the Derivative Volume table and the Hedges of Net Investments in International Operations section appearing later in this footnote. As of September 30, 2017 Total
Fair Value of Net
Asset/(Liability) Quoted Prices in
Active Markets
for Identical
Assets
(Level 1) Significant
Other Observable
Inputs
(Level 2) Significant
Unobservable
Inputs
(Level 3) (in millions) $ 23 $ – $ 23 $ – (133 ) (133 ) – – (383 ) – (383 ) – $ (493 ) $ (133 ) $ (360 ) $ – As of December 31, 2016 Total
Fair Value of Net
Asset/(Liability) Quoted Prices in
Active Markets
for Identical
Assets
(Level 1) Significant
Other Observable
Inputs
(Level 2) Significant
Unobservable
Inputs
(Level 3) (in millions) $ (3 ) $ – $ (3 ) $ – (60 ) (86 ) 26 – 97 – 97 – $ 34 $ (86 ) $ 120 $ – As of March 31, 2021 Total
Fair Value of Net
Asset/(Liability)Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)Significant
Other Observable
Inputs
(Level 2)Significant
Unobservable
Inputs
(Level 3) (in millions) Currency exchange contracts $ 68 $ 0 $ 68 $ 0 Commodity contracts 145 68 77 0 Interest rate contracts (180) 0 (180) 0 Net investment hedge contracts 60 0 60 0 Total derivatives $ 93 $ 68 $ 25 $ 0 As of December 31, 2020 Total
Fair Value of Net
Asset/(Liability)Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)Significant
Other Observable
Inputs
(Level 2)Significant
Unobservable
Inputs
(Level 3) (in millions) Currency exchange contracts $ 15 $ 0 $ 15 $ 0 Commodity contracts 77 46 31 0 Interest rate contracts (328) 0 (328) 0 Net investment hedge contracts (15) 0 (15) 0 Total derivatives $ (251) $ 46 $ (297) $ 0 Our exchange-traded derivatives are generally subject to master netting arrangements that permit net settlement of transactions with the same counterparty when certain criteria are met, such as in the event of default. We also are required to maintain cash margin accounts in connection with funding the settlement of our open positions, and the margin requirements generally fluctuate daily based on market conditions. We have recorded margin deposits related to our exchange-traded derivatives of $198 million as of September 30, 2017 and $133 million as of December 31, 2016 within other current assets. Based on our net asset or liability positions with individual counterparties, in the event of default and immediate net settlement of all of our open positions, for derivatives we have in a net asset position, our counterparties would owe us a total of $65 million as of September 30, 2017 and $48 million as of December 31, 2016. As of September 30, 2017, we have no derivatives in a net liability position, and as of December 31, 2016 we would have owed $2 million for derivatives in a net liability position.commodity and currency exchange OTC derivativesderivative contracts do not have a legal right of set-off. In connection with our OTC derivatives that could be net-settled in the event of default, assuming all parties were to fail to comply with the terms of the agreements, for derivatives we have in a net liability position, we would owe $409 million as of September 30, 2017 and $40 million as of December 31, 2016, and for derivatives we have in a net asset position, our counterparties would owe us a total of $25 million as of September 30, 2017 and $162 million as of December 31, 2016. We manage the credit risk in connection with these and all our derivatives by entering into transactions with counterparties with investment grade credit ratings, limiting the amount of exposure with each counterparty and monitoring the financial condition of our counterparties. net notional values of our derivativehedging instruments were: Notional Amount As of September 30,
2017 As of December 31,
2016 (in millions) $ 3,649 $ 3,343 2,066 1,452 1,137 837 6,517 6,365 3,975 4,012 454 419 1,704 1,447 Notional Amount As of March 31, 2021 As of December 31, 2020 (in millions) Currency exchange contracts: Intercompany loans and forecasted interest payments $ 2,218 $ 2,184 Forecasted transactions 3,845 4,169 Commodity contracts 6,088 7,947 Interest rate contracts 3,500 3,500 Net investment hedges: Net investment hedge derivative contracts 4,720 4,551 Non-U.S. dollar debt designated as net investment hedges Euro notes 3,737 3,744 British pound sterling notes 363 360 Swiss franc notes 1,102 1,175 Canadian dollar notes 478 472 For the Three Months Ended
September 30, For the Nine Months Ended
September 30, 2017 2016 2017 2016 (in millions) $ (91 ) $ (36 ) $ (121 ) $ (45 ) (13 ) (2 ) (10 ) 64 (6 ) 4 21 (53 ) $ (110 ) $ (34 ) $ (110 ) $ (34 ) For the Three Months Ended
September 30, For the Nine Months Ended
September 30, 2017 2016 2017 2016 (in millions) $ (3 ) $ (6 ) $ (2 ) $ (3 ) 16 8 12 (1 ) – – – (60 ) $ 13 $ 2 $ 10 $ (64 ) For the Three Months Ended
September 30, For the Nine Months Ended
September 30, 2017 2016 2017 2016 (in millions) $ (11 ) $ (11 ) $ (37 ) $ (21 ) 25 10 31 19 (20 ) 5 27 (51 ) $ (6 ) $ 4 $ 21 $ (53 ) For the Three Months Ended
March 31, 2021 2020 (in millions) Accumulated (loss)/gain at beginning of period $ (161) $ (213) Transfer of realized losses/(gains) in fair value
to earnings5 81 Unrealized (loss)/gain in fair value (3) (23) Accumulated (loss)/gain at end of period $ (159) $ (155) For the Three Months Ended
March 31, 2021 2020 (in millions) Interest rate contracts $ (5) $ (81) For the Three Months Ended
March 31, 2021 2020 (in millions) Currency exchange contracts – forecasted transactions $ (1) $ 0 Interest rate contracts (2) (23) Total $ (3) $ (23) Within interest and other expense, net, we recorded pre-tax losses and after-tax (i) gains or losses reclassified from accumulated other comprehensive earnings/(losses) into earnings, (ii) gains or losses on ineffectiveness and (iii) gains or losses on amounts excluded from effectiveness testing in:cost of sales for commodity contracts;cost of sales for currency exchange contracts related to forecasted transactions; andcontracts and currency exchange contracts related to intercompany loans.contracts.$11 million (net of taxes) for commodity cash flow hedges, unrealized losses of $2 million (net of taxes) for currency cash flow hedges and unrealized losses of $1$113 million (net of taxes) for interest rate cash flow hedges to earnings during the next 12 months.September 30, 2017, we hedged transactionsMarch 31, 2021, our longest dated cash flow hedges were interest rate swaps that hedge forecasted to impact cash flowsinterest rate payments over the following periods:commodity transactions for periods not exceeding the next 3 months;years and 6 months.transactionsswaps, forwards and options to hedge certain investments in our non-U.S. operations against movements in exchange rates. The aggregate notional value as of March 31, 2021 was $4.7 billion. The impacts of the net investment hedge derivative contracts on other comprehensive earnings and net earnings were as follows: For the Three Months Ended
March 31, 2021 2020 (in millions) $ 59 $ 332 periods not exceedingunsettled and settled NIH derivative contracts are recorded in the next 6 years and 1 month; andcumulative translation adjustment within other comprehensive earnings. The cash flows from the settled contracts are reported within other investing activities in the condensed consolidated statement of cash flows.currency exchange transactions for periods not exceeding the next 3 months. For the Three Months Ended
March 31, 2021 2020 (in millions) $ 20 $ 33 Fair Value Hedges:Pre-tax gains/(losses) dueour interest rate swaps and related hedged long-term debt were recordedamounts excluded from the assessment of effectiveness in net earnings within interest and other expense, net: For the Three Months Ended
September 30, For the Nine Months Ended
September 30, 2017 2016 2017 2016 (in millions) $ (2 ) $ (11 ) $ (4 ) $ (2 ) 2 11 4 2 For the Three Months Ended
September 30, For the Nine Months Ended
September 30,
Gain/(Loss)
Recognized 2017 2016 2017 2016 (in millions) $ (13 ) $ 7 $ (8 ) $ 18 Interest and other expense, net (1 ) (14 ) – (91 ) Cost of sales 1 2 (1 ) 10 Interest and other expense, net – 4 2 16 Selling, general and administrative expenses (17 ) (13 ) (176 ) (26 ) Cost of sales $ (30 ) $ (14 ) $ (183 ) $ (73 ) For the Three Months Ended
September 30, For the Nine Months Ended
September 30,
Gain/(Loss)
Recognized in AOCI 2017 2016 2017 2016 (in millions) $ (83 ) $ (38 ) $ (279 ) $ (110 ) Currency (8 ) 21 (23 ) 107 Translation 12 (4 ) (53 ) (33 ) Adjustment For the Three Months Ended
March 31, 2021 2020 (in millions) Euro notes $ 124 $ 42 British pound sterling notes (2) 17 Swiss franc notes 56 (6) Canadian notes (5) 27 For the Three Months Ended
March 31,Location of Gain/(Loss) Recognized in Earnings 2021 2020 (in millions) Currency exchange contracts: Intercompany loans and forecasted interest payments $ 70 $ (73) Interest and other expense, net Forecasted transactions 50 26 Cost of sales Forecasted transactions (16) 1 Interest and other expense, net Forecasted transactions 2 (1) Selling, general and administrative expenses Commodity contracts 94 (197) Cost of sales Total $ 200 $ (244) 9.10. Benefit Plans U.S. Plans Non-U.S. Plans For the Three Months Ended
September 30, For the Three Months Ended
September 30, 2017 2016 2017 2016 (in millions) $ 12 $ 15 $ 40 $ 37 16 15 51 57 (25 ) (24 ) (110 ) (105 ) 10 12 43 31 – – (1 ) – 6 9 – – $ 19 $ 27 $ 23 $ 20 U.S. Plans Non-U.S. Plans For the Nine Months Ended
September 30, For the Nine Months Ended
September 30, 2017 2016 2017 2016 (in millions) $ 34 $ 42 $ 117 $ 114 47 46 148 179 (75 ) (72 ) (322 ) (326 ) 27 30 124 93 1 1 (2 ) (2 ) 27 25 2 (1 ) $ 61 $ 72 $ 67 $ 57 Within settlement losses/(gains) and other expenses are losses of $1 million for U.S. Plans Non-U.S. Plans For the Three Months Ended
March 31,For the Three Months Ended
March 31, 2021 2020 2021 2020 (in millions) Service cost $ 2 $ 1 $ 35 $ 30 Interest cost 10 13 29 37 Expected return on plan assets (18) (19) (106) (99) Amortization: Net loss from experience differences 4 4 33 29 Prior service cost/(benefit) 0 0 (2) (2) Settlement losses and other expenses 3 4 0 2 Net periodic pension cost $ 1 $ 3 $ (11) $ (3) and $12 million for the nine months ended September 30, 2017 and $3 million for the three months and $12 million for the nine months ended September 30, 2016, that are related to our 2014-2018 Restructuring Program and are recorded within asset impairment and exit costs on our condensed consolidated statements of earnings.Employer Contributions:During the nine months ended September 30, 2017,March 31, 2021, we contributed $19$3 million to our U.S. pension plans and $408$63 million to our non-U.S. pension plans. The non-U.S. amount included a non-recurring $250plans, including $31 million contribution made in connection with a new funding agreement for a Company planto plans in the U.K.United Kingdom and Ireland. We make contributions to our pension plans in accordance with local funding arrangements and statutory minimum funding requirements. Discretionary contributions are made to the extent that they are tax deductible and do not generate an excise tax liability.September 30, 2017,March 31, 2021, over the remainder of 2021, we plan to make further contributions of approximately $7$5 million to our U.S. plans and approximately $47$165 million to our non-U.S. plans during the remainder of 2017.plans. Our actual contributions may be different due to many factors, including changes in tax and other benefit laws, significant differences between expected and actual pension asset performance or interest rates.costsbenefit consisted of the following: For the Three Months Ended
September 30, For the Nine Months Ended
September 30, 2017 2016 2017 2016 (in millions) $ 1 $ 3 $ 5 $ 9 4 6 11 16 4 2 11 5 (10 ) (11 ) (30 ) (14 ) $ (1 ) $ – $ (3 ) $ 16 (1)For the three and nine months ended September 30, 2017, amortization of prior service credit includes an $8 million and $24 million gain respectively, related to a change in the eligibility requirement and a change in benefits to Medicare-eligible participants. For the Three Months Ended
March 31, 2021 2020 (in millions) Service cost $ 1 $ 1 Interest cost 2 3 Amortization: Net loss from experience differences 1 3 Prior service credit 0 (8) Net periodic postretirement health care benefit $ 4 $ (1) costscost consisted of the following: For the Three Months Ended
September 30, For the Nine Months Ended
September 30, 2017 2016 2017 2016 (in millions) $ 1 $ 2 $ 4 $ 5 1 1 3 4 (1 ) – (3 ) – $ 1 $ 3 $ 4 $ 9 For the Three Months Ended
March 31, 2021 2020 (in millions) Service cost $ 1 $ 1 Interest cost 1 1 Amortization of net gains (1) (1) Net periodic postemployment cost $ 1 $ 1 10.11. Stock Plans Shares Subject
to Option Weighted-
Average
Exercise or
Grant Price
Per Share Average
Remaining
Contractual
Term Aggregate
Intrinsic
Value 53,601,612 $ 28.02 6 years $ 874 million 6,012,140 43.20 29,300 44.49 6,041,440 43.21 (7,837,372 ) 26.49 $ 142 million (1,536,249 ) 38.96 50,269,431 29.75 6 years $ 563 million (1)Cash received from options exercised was $43 million in the three months and $213 million in the nine months ended September 30, 2017. The actual tax benefit realized and recorded in the provision for income taxes for the tax deductions from the option exercises totaled $6 million in the three months and $24 million in the nine months ended September 30, 2017. Shares Subject
to OptionWeighted-
Average
Exercise or
Grant Price
Per ShareAverage
Remaining
Contractual
TermAggregate
Intrinsic
ValueBalance at January 1, 2021 27,751,894 $39.51 5 years $ 527 million Annual grant to eligible employees 2,412,080 56.13 Additional options issued 48,170 57.09 Total options granted 2,460,250 56.15 (1,734,108) 29.72 $ 46 million Options canceled (222,648) 44.57 Balance at March 31, 2021 28,255,388 41.52 6 years $ 482 million Weighted-Average Weighted-Average Number Fair Value Aggregate of Shares Grant Date Per Share(3) Fair Value(3) 7,593,627 $ 36.90 Feb. 16, 2017 1,087,010 43.14 845,550 43.20 546,001 Various 33.81 2,478,561 41.11 $ 102 million (2,522,072 ) 33.70 $ 84 million (675,920 ) 38.43 6,874,196 39.44 (1)Includes performance share units and deferred stock units.(2)Includes performance share units, deferred stock units and historically granted restricted stock. The actual tax benefit realized and recorded in the provision for income taxes for the tax deductions from the shares vested totaled less than $1 million in the three months and $7 million in the nine months ended September 30, 2017.(3)Prior-year weighted average fair value per share has been revised.Number
of SharesGrant Date Balance at January 1, 2021 4,896,990 $53.80 Annual grant to eligible employees: Feb 18, 2021 Performance share units 903,250 59.35 Deferred stock units 549,710 56.13 1,043,632 Various 52.99 Total shares granted 2,496,592 55.98 $ 140 million (2,291,494) 49.80 $ 114 million Forfeited (126,925) 56.45 Balance at March 31, 2021 4,975,163 56.67 During$7.7a total of $13.7 billion of our Common Stock through December 31, 2016.2018. On July 29, 2015,January 31, 2018, our Finance Committee, with authorization delegated from our Board of Directors, approved an increase of $6.0 billion in the share repurchase program, raising the authorization to $13.7$19.7 billion of Common Stock repurchases, and extended the program through December 31, 2018.2020. On December 2, 2020, our Board of Directors approved an increase of $4.0 billion in the share repurchase program, raising the authorization to $23.7 billion of Common Stock repurchases, and extended the program through December 31, 2023. Repurchases under the program are determined by management and are wholly discretionary. Prior to January 1, 2017,2021, we had repurchased $10.8approximately $18.0 billion of Common Stock pursuant to this authorization. During the ninethree months ended September 30, 2017,March 31, 2021, we repurchased approximately 4218.2 million shares of Common Stock at an average cost of $43.67$55.97 per share, or an aggregate cost of approximately $1,817 million,$1.0 billion, all of which was paid during the period except for approximately $31 million settled in October 2017.period. All share repurchases were funded through available cash and commercial paper issuances. As of September 30, 2017,March 31, 2021, we have approximately $1$4.7 billion in remaining share repurchase capacity.11.12. Commitments and Contingencies (“Legal Matters”) arising in the ordinary course of or incidental to our business.In February 2013business, including those noted below in this section. We record provisions in the consolidated financial statements for pending litigation when we determine that an unfavorable outcome is probable and March 2014, Cadbury India Limited (now known as Mondelez India Foods Private Limited), a subsidiary of Mondelēz International, and other parties received show cause notices from the Indian Central Excise Authority (the “Excise Authority”) calling upon the parties to demonstrate why the Excise Authority should not collect a total of 3.7 billion Indian rupees ($57 million as of September 30, 2017) of unpaid excise tax and an equivalent amount of penalties, as well as interest, related to production at the same Indian facility. We contested these demands for unpaid excise taxes, penalties and interest. On March 27, 2015, after several hearings, the Commissioner of the Excise Authority issued an order denying the excise exemption that we claimed for the Indian facility and confirming the Excise Authority’s demands for total taxes and penalties in the amount of 5.8 billion Indian rupees ($90 million asthe loss can be reasonably estimated. For matters we have not provided for that are reasonably possible to result in an unfavorable outcome, management is unable to estimate the possible loss or range of September 30, 2017). Weloss or such amounts have appealed this order. In addition, the Excise Authority issued additional show cause notices in February 2015, December 2015 and October 2017 on the same issue but covering the periods January to October 2014, November 2014 to September 2015 and October 2015 to June 2017, respectively. These notices added a total of 4.9 billion Indian rupees ($75 million as of September 30, 2017) of unpaid excise taxes as well as penaltiesbeen determined to be determined up to an amount equivalent to that claimed by the Excise Authority plus interest. With the implementation of the new Goods and Services Tax in India in July 2017,immaterial. At present we will not receive any further show cause notices for additional amounts on this issue. We believe that the decisionultimate outcome of these proceedings, individually and in the aggregate, will not materially harm our financial position, results of operations or cash flows. However, legal proceedings and government investigations are subject to claim the excise tax benefit is validinherent uncertainties, and weunfavorable rulings or other events could occur. Unfavorable resolutions could involve substantial monetary damages. In addition, in matters for which conduct remedies are continuing to contest the show cause notices through the administrative and judicial process.Insought, unfavorable resolutions could include an injunction or other order prohibiting us from selling one or more products at all or in particular ways, precluding particular business practices or requiring other remedies. An unfavorable outcome might result in a material adverse impact on our business, results of operations or financial position.2013, the staff of1, 2015, the U.S. Commodity Futures Trading Commission (“CFTC”("CFTC") advised us and Kraft Foods Group that it was investigating activities related to the trading of December 2011 wheat futures contracts that occurred prior to the Spin-Off of Kraft Foods Group. We cooperated with the staff in its investigation. On April 1, 2015, the CFTC filed a complaint against Kraft Foods Group and Mondelēz Global LLC (“Mondelēz Global”) in the U.S. District Court for the Northern District of Illinois (the "District Court"), Eastern Division (the “CFTC action”). following its investigation of activities related to the trading of December 2011 wheat futures contracts that occurred prior to the spin-off of Kraft Foods Group. The complaint alleges that Kraft Foods Group and Mondelēz Global (1) manipulated or attempted to manipulate the wheat markets during the fall of 2011; (2) violated position limit levels for wheat futures and (3) engaged in non-competitive trades by trading both sides of exchange-for-physical Chicago Board of Trade wheat contracts. The CFTC seeks civil monetary penalties of either triple the monetary gain for each violation of the Commodity Exchange Act (the “Act”) or $1 million for each violation of Section 6(c)(1), 6(c)(3) or 9(a)(2) of the Act and $140,000 for each additional violation of the Act, plus post-judgment interest; an order of permanent injunction prohibiting Kraft Foods Group and Mondelēz Global from violating specified provisions of the Act; disgorgement of profits; and costs and fees. In December 2015,On August 15, 2019, the court deniedDistrict Court approved a settlement agreement between the CFTC and Mondelēz GlobalGlobal. The terms of the settlement, which are available in the District Court’s docket, had an immaterial impact on our financial position, results of operations and Kraft Foods Group’s motion to dismisscash flows. On October 23, 2019, following a ruling by the CFTC’s claimsUnited States Court of market manipulationAppeals for the Seventh Circuit regarding Mondelēz Global's allegations that the CFTC and attempted manipulation,its Commissioners violated certain terms of the settlement agreement and the CFTC's argument that the Commissioners were not bound by the terms of the settlement agreement, the District Court vacated the settlement agreement and reinstated all pending motions that the District Court had previously mooted as a result of the settlement.The parties are nowhave reached a new agreement in discovery.principle to resolve the CFTC action and have submitted the settlement to the District Court for approval. The District Court cancelled a scheduled conference on June 4, 2020 to discuss the proposed settlement agreement but indicated that it would rule on pending motions in due course. Additionally, several class action complaints were filed against Kraft Foods Group and Mondelēz Global in the U.S. District Court for the Northern District of Illinois by investors in wheat futures and options on behalf of themselves and others similarly situated. The complaints make similar allegations as those made in the CFTC action, and seekthe plaintiffs are seeking class action certification; an unspecified amount formonetary damages, interest and unjust enrichment; costs and fees; and injunctive, declaratory and other unspecified relief. In June 2015, these suits were consolidated in the Northern District of Illinois. In June 2016,Court. On January 3, 2020, the court denied Mondelēz Global and Kraft Foods Group’s motionDistrict Court granted plantiffs' request to dismiss, and the parties are now in discovery.certify a class. It is not possible to predict the outcome of these matters; however, based on our Separation and Distribution Agreement with Kraft Foods Group dated as of September 27, 2012, we expect to bear any monetary penalties or other payments in connection with the CFTC action and the class action.While we cannot Although the CFTC action and the class action complaints involve the same alleged conduct, a resolution or decision with respect to one of the matters may not be dispositive as to the outcome of the other matter.with certaintyhow long the results of any Legal Matters in which we are currently involved, we do not expect thatinvestigation will take or the ultimate costs to resolve anyoutcome of these Legal Matters, individually or in the aggregate, will have a material effect on our financial results.September 30, 2017,March 31, 2021, we had no material third-party guarantees recorded on our condensed consolidated balance sheet.As part of our 2010 Cadbury acquisition, we became the responsibleforto various tax matters under a February 2, 2006 dated Deed of Tax Covenant between the Cadbury Schweppes PLC and related entities (“Schweppes”) and Black Lion Beverages and related entities. The tax matters included an ongoing transfer pricing case with the Spanish tax authorities related to the Schweppes businesses Cadbury divested priormatter proceedings incidental to our acquisitionbusiness. These proceedings are subject to inherent uncertainties, and unfavorable outcomes could subject us to additional tax liabilities and could materially adversely impact our business, results of Cadbury. During the first quarteroperations or financial position.12.13. Reclassifications from Accumulated Other Comprehensive Income the accumulated balances of each component of accumulated other comprehensive earnings/(losses) attributable to Mondelēz International. Amounts reclassified from accumulated other comprehensive earnings/(losses) to net earnings (net of tax) were net losses of $28$34 million in the first three months of 2021 and $112$104 million in the nine months ended September 30, 2017 and $28 million in thefirst three months of 2020.For the Three Months Ended
March 31,2021 2020 (in millions) Currency Translation Adjustments: Balance at beginning of period $ (8,655) $ (8,320) Currency translation adjustments (134) (1,281) Tax (expense)/benefit (2) (90) Other comprehensive earnings/(losses) (136) (1,371) Less: other comprehensive (earnings)/loss attributable to noncontrolling interests 9 5 Balance at end of period (8,782) (9,686) Pension and Other Benefit Plans: Balance at beginning of period $ (1,874) $ (1,721) Net actuarial gain/(loss) arising during period (1) (22) Losses/(gains) reclassified into net earnings: 35 25 Settlement losses and other expenses 3 6 (9) (8) Currency impact 41 59 Other comprehensive earnings/(losses) 69 60 Balance at end of period (1,805) (1,661) Derivative Cash Flow Hedges: Balance at beginning of period $ (161) $ (213) Net derivative gains/(losses) (7) (40) Tax (expense)/benefit on net derivative gain/(loss) 1 15 Losses/(gains) reclassified into net earnings: 6 105 (1) (24) Currency impact 3 2 Other comprehensive earnings/(losses) 2 58 Balance at end of period (159) (155) Accumulated other comprehensive income
attributable to Mondelēz International:Balance at beginning of period $ (10,690) $ (10,254) Total other comprehensive earnings/(losses) (65) (1,253) Less: other comprehensive (earnings)/loss attributable to noncontrolling interests 9 5 Other comprehensive earnings/(losses) attributable to Mondelēz International (56) (1,248) Balance at end of period $ (10,746) $ (11,502) $206 million in the nine months ended September 30, 2016. For the Three Months Ended
September 30, For the Nine Months Ended
September 30, 2017 2016 2017 2016 (in millions) $ (8,007 ) $ (7,902 ) $ (8,914 ) $ (8,006 ) 291 15 1,055 53 – – – 57 46 13 205 21 337 28 1,260 131 (8 ) 2 (24 ) 3 (7,678 ) (7,872 ) (7,678 ) (7,872 ) $ (2,119 ) $ (1,830 ) $ (2,087 ) $ (1,934 ) (28 ) – (19 ) 24 25 – 25 (9 ) 47 30 130 93 6 10 24 25 (10 ) (10 ) (31 ) (34 ) (50 ) 7 (171 ) 42 (10 ) 37 (42 ) 141 (2,129 ) (1,793 ) (2,129 ) (1,793 ) $ (91 ) $ (36 ) $ (121 ) $ (46 ) 2 6 31 (77 ) (5 ) (2 ) (1 ) 25 2 7 2 3 (21 ) (8 ) (15 ) 7 – – – 96 6 (1 ) 3 (41 ) (3 ) – (9 ) (1 ) (19 ) 2 11 12 (110 ) (34 ) (110 ) (34 ) $ (10,217 ) $ (9,768 ) $ (11,122 ) $ (9,986 ) 308 67 1,229 284 (8 ) 2 (24 ) 3 300 69 1,205 287 $ (9,917 ) $ (9,699 ) $ (9,917 ) $ (9,699 ) (1)These reclassified losses are included in the components of net periodic benefit costs disclosed in Note 9,Benefit Plans.(2)Taxes reclassified to earnings are recorded within the provision for income taxes.(3)These reclassified gains or losses are recorded within cost of sales.(4)These reclassified losses are recorded within interest and other expense, net.13.14. Income TaxesBased on current tax laws,for 2017, excludingwhich excludes discrete tax impacts, was 25.2%. This rate reflected the impactsimpact of unfavorable foreign provisions under U.S. tax laws and our tax related to earnings from the saleequity method investments (the earnings are reported separately on our statement of our Australian grocery business, is 25.8%earnings and thus not included in earnings before income taxes), which reflectspartially offset by favorable impacts from the mix of pre-tax income in various non-U.S. tax jurisdictions, partially offset by an increase in domestic earnings as compared to the prior year. Our 2017 third quarter effective tax rate of 23.4% was favorably impacted by the divestiture of our Australian grocery business, which had a lower effective tax rate, resulting in a $27 million tax expense related to the pre-tax gain of $187 million.jurisdictions. Our effective tax rate for the ninethree months ended September 30, 2017March 31, 2021 of 21.3%19.1% was also favorably impacted by the sale of our Australian grocery business as well as other discrete one-time benefits. The discrete net tax benefits of $65 million, primarily consisted ofdriven by a $74$32 million net benefit from the release of liabilities for uncertain tax positions due to expirations of statutes of limitations and audit settlements in variousseveral jurisdictions and a $16$27 million benefit relatedfrom a U.S. amended tax return filed to reflect new guidance from the U.S. domestic production activities deduction.thirdfirst quarter of 2016,2020, our estimated annual effective tax rate, for 2016which excluded discrete tax impacts, was 20.8%25.2%. This rate reflected the impact of unfavorable foreign provisions under U.S. tax laws and our tax related to earnings from equity method investments (the earnings are reported separately on our statement of earnings and thus not included in earnings before income taxes), reflectingpartially offset by favorable impacts from the mix of pre-tax income in various non-U.S. tax jurisdictions. Our 2016 third quarter effective tax rate of 7.2% included net benefit from discrete one-time events of $60 million, mainly due to $35 million from expirations of statutes of limitations and favorable audit settlements in several jurisdictions and a $17 million benefit from the reduction of U.K. net deferred tax liabilities resulting from tax legislation enacted during the third quarter of 2016 that reduced the U.K. corporate income tax rate. Our effective tax rate for the ninethree months ended September 30, 2016March 31, 2020 of 13.6%21.2% was favorably impacted by discrete net tax benefits of $109$28 million, primarily driven by a $22 million net benefit from discrete one-time events. The discrete netthe release of liabilities for uncertain tax benefits primarily consisted of benefits of $73 millionpositions due to expirations of statutes of limitations and favorable audit settlements in several jurisdictions and a $17 million benefit from the reduction of U.K. net deferred tax liabilities resulting from tax legislation enacted during the third quarter of 2016 that reduced the U.K. corporate income tax rate.jurisdictions.14.15. Earnings Perper Share For the Three Months Ended
September 30, For the Nine Months Ended
September 30, 2017 2016 2017 2016 (in millions, except per share data) $ 993 $ 548 $ 2,126 $ 1,576 (1 ) – (6 ) (10 ) $ 992 $ 548 $ 2,120 $ 1,566 1,507 1,557 1,518 1,561
of stock options and long-term incentive plan shares 17 19 19 18 1,524 1,576 1,537 1,579
Mondelēz International $ 0.66 $ 0.35 $ 1.40 $ 1.00
Mondelēz International $ 0.65 $ 0.35 $ 1.38 $ 0.99 For the Three Months Ended
March 31, 2021 2020 (in millions, except per share data) Net earnings $ 968 $ 743 Noncontrolling interest earnings (7) (7) Net earnings attributable to
Mondelēz International$ 961 $ 736 Weighted-average shares for basic EPS 1,412 1,434 Plus incremental shares from assumed conversions
of stock options and long-term incentive plan shares10 11 Weighted-average shares for diluted EPS 1,422 1,445 Basic earnings per share attributable to
Mondelēz International$ 0.68 $ 0.51 Diluted earnings per share attributable to
Mondelēz International$ 0.68 $ 0.51 9.03.6 million forin the first three months of 2021and 8.04.0 million forin the nine months ended September 30, 2017 and 4.3 million for thefirst three months and 7.7 million for the nine months ended September 30, 2016.of 2020.15.16. Segment ReportingOur operations and management structure are organized into four reportable operating segments:Latin AmericaAMEAEuropeNorth AmericaOn October 1, 2016, we integrated our EEMEA operating segment into our Europe and Asia Pacific operating segments to further leverage and optimize the operating scale built within the Europe and Asia Pacific regions. Russia, Ukraine, Turkey, Belarus, Georgia and Kazakhstan were combined within our Europe operating segment, while the remaining Middle East and African countries were combined within our Asia Pacific region to form the AMEA operating segment. We have reflected the segment change as if it had occurred in all periods presented.inacross our key markets. Our regional management teams have responsibility for the business, product categories and financial results in the regions.and gains and losses on divestitures and acquisition-related costs (which are a component of selling, general and administrative expenses) in all periods presented. We exclude these items from segment operating income in order to provide better transparency of our segment operating results. Furthermore, we centrally manage benefit plan non-service income and interest and other expense, net. Accordingly, we do not present these items by segment because they are excluded from the segment profitability measure that management reviews.revised to reflect our new segment structure, were: For the Three Months Ended
September 30, For the Nine Months Ended
September 30, 2017 2016 2017 2016 (in millions) $ 908 $ 868 $ 2,666 $ 2,528 1,405 1,443 4,290 4,404 2,442 2,332 6,978 7,073 1,775 1,753 4,996 5,148 $ 6,530 $ 6,396 $ 18,930 $ 19,153 $ 255 $ 92 $ 469 $ 191 82 165 425 504 410 316 1,158 924 318 274 824 840 28 (12 ) (69 ) (49 ) (54 ) (89 ) (196 ) (216 ) (45 ) (44 ) (133 ) (132 ) 187 – 184 – 1,181 702 2,662 2,062 (19 ) (145 ) (262 ) (540 ) $ 1,162 $ 557 $ 2,400 $ 1,522 For the Three Months Ended
March 31,2021 2020 (in millions) Net revenues: Latin America $ 669 $ 726 AMEA 1,745 1,502 Europe 2,847 2,584 North America 1,977 1,895 Net revenues $ 7,238 $ 6,707
Earnings before income taxes:Operating income: Latin America $ 76 $ 78 AMEA 362 234 Europe 557 472 North America 270 381 Unrealized gains/(losses) on hedging activities
(mark-to-market impacts)118 (185) General corporate expenses (64) (76) Amortization of intangibles (38) (43) Gain on acquisition 9 0 Acquisition-related costs (7) (5) Operating income 1,283 856 Benefit plan non-service income 44 33 Interest and other expense, net (218) (190) Earnings before income taxes $ 1,109 $ 699 DivestituresAcquisitions and Acquisitions,Divestitures, Note 4,Property, Plant and Equipment,Note 5,Goodwill and Intangible Assets,Note 6,2014-2018 Restructuring Program and Note 11,Commitments and Contingencies7, Restructuring Program. Also see Note 7,8, Debt and Borrowing Arrangements, and Note 8,9, Financial Instruments, for more information on our interest and other expense, net for each period.revised to reflect our new segment structure, were: For the Three Months Ended September 30, 2017 Latin
America AMEA Europe North
America Total (in millions) $ 210 $ 444 $ 761 $ 1,427 $ 2,842 207 520 1,196 74 1,997 247 228 185 274 934 155 104 23 – 282 89 109 277 – 475 $ 908 $ 1,405 $ 2,442 $ 1,775 $ 6,530 For the Three Months Ended September 30, 2016 Latin
America AMEA Europe North
America Total (in millions) $ 191 $ 416 $ 677 $ 1,403 $ 2,687 185 508 1,124 65 1,882 247 239 218 285 989 164 107 37 – 308 81 173 276 – 530 $ 868 $ 1,443 $ 2,332 $ 1,753 $ 6,396 For the Nine Months Ended September 30, 2017 Latin
America AMEA Europe North
America Total (in millions) $ 580 $ 1,198 $ 2,130 $ 4,061 $ 7,969 660 1,460 3,365 194 5,679 701 695 582 741 2,719 477 466 88 – 1,031 248 471 813 – 1,532 $ 2,666 $ 4,290 $ 6,978 $ 4,996 $ 18,930 For the Nine Months Ended September 30, 2016 Latin
America AMEA Europe North
America Total (in millions) $ 551 $ 1,179 $ 2,039 $ 4,162 $ 7,931 562 1,393 3,368 153 5,476 713 745 688 833 2,979 466 513 124 – 1,103 236 574 854 – 1,664 $ 2,528 $ 4,404 $ 7,073 $ 5,148 $ 19,153 For the Three Months Ended March 31, 2021 Latin
AmericaAMEA Europe North
AmericaTotal (in millions) Biscuits $ 177 $ 583 $ 802 $ 1,736 $ 3,298 Chocolate 192 670 1,552 63 2,477 Gum & Candy 131 194 148 178 651 Beverages 94 180 33 0 307 Cheese & Grocery 75 118 312 0 505 Total net revenues $ 669 $ 1,745 $ 2,847 $ 1,977 $ 7,238 For the Three Months Ended March 31, 2020 Latin
AmericaAMEA Europe North
AmericaTotal (in millions) Biscuits $ 174 $ 508 $ 746 $ 1,598 $ 3,026 Chocolate 194 543 1,363 56 2,156 Gum & Candy 182 185 173 241 781 Beverages 102 171 25 0 298 Cheese & Grocery 74 95 277 0 446 Total net revenues $ 726 $ 1,502 $ 2,584 $ 1,895 $ 6,707 manufacturemake and marketsell primarily snack food products,snacks, including biscuits (cookies, crackers and salted snacks), chocolate, gum & candy andas well as various cheese & grocery products, as well asand powdered beverage products. We have operations in more thanapproximately 80 countries and sell our products in approximately 165over 150 countries.deliver strong, profitablebe the global leader in snacking. Our strategy is to drive long-term growth by focusing on three strategic priorities: accelerating consumer-centric growth, driving operational excellence and creating a winning growth culture. We believe the successful implementation of our core snacksstrategic priorities and leveraging of our strong foundation of iconic global and local brands, an attractive global footprint, our market leadership in developed and emerging markets, our deep innovation, marketing and distribution capabilities, and our efficiency and sustainability efforts, will drive top- and bottom-line growth, enabling us to continue to create long-term value for our shareholders.expanding the reachsharp reduction in global travel due to the pandemic continued to negatively impact our world travel retail business.Power Brands globally. Leveragingemployees, customers and consumers, which is our Power Brandsfirst priority:innovation platforms,employees. In many locations, our employees are working remotely whenever possible. For employees who are unable to work remotely, we planadopted a number of heightened protocols, consistent with those prescribed by the World Health Organization, related to innovate boldlysocial distancing (including staggering lunchtimes and connect withshifts where possible and restricting in-person gatherings and non-essential travel) and enhanced hygiene and workplace sanitation. At a local level, we also provided additional flexibility and support to employees in our consumers wherever they are, including new markets aroundmanufacturing facilities, distribution and logistics operations and sales organization.world, using both traditionalU.S. and digital channels. We monitor developments in consumer preferences,other locations to meet additional marketplace demand and as consumers in many markets seek better-for-you products,promote uninterrupted functioning of our manufacturing, distribution and sales network. continuemade a $15 million initial global commitment to expand our portfolio through additional well-being offerings, including enhancing the goodness of existing brands. As shopping expands further online, we are also workingsupport local and global organizations responding to grow our e-commerce platformfood instability and on-line presence with consumers.providing emergency relief. To fuel these investments,date, we have increased the level of support provided to approximately $28 million.working to optimizemaintain the availability of our cost structure. These efforts consistproducts to meet the needs of reinventingour consumers. In response to increased demand, we increased production and, to date, we have not experienced material disruptions in our supply chain including addingor operations:upgradingwe put in place procedures across our supply chain to help mitigate the risk that our manufacturing sites experience material closures or disruptions.efficient production lines, while reducingvolatile. Although we monitor these costs and our exposure to commodity prices and hedge against input price increases, we cannot fully hedge against all cost increases and changes in costs, and our hedging strategies may not protect us from increases in specific raw material costs. We anticipate continued commodity and other cost volatility as the complexitypandemic continues.offerings, ingredientsor distribution costs, prices and potentially affect the availability of our products.suppliers. jurisdictions, we were able to defer certain of these tax payments in 2020, which provided a cash benefit that reverses when the payments come due. Some of these payments were already made by the end of the first quarter of 2021; the remainder will come due in 2021 and 2022. The benefits associated with the deferral of these tax payments were not material to our financial statements.aggressively managemaintain oversight over our overhead costs. Wecore process controls through our centralized shared service model, with key controls operating as designed.embracedseen some improvements in business and embedded zero-based budgeting practiceseconomic conditions across many markets in which we do business, additional adverse impacts could arise that we cannot currently anticipate. Barring material business disruptions or other negative developments, we expect to continue to meet the organization to identify potential areasdemand of cost reductions and capture and sustain savings within our ongoing operating budgets. Through these actions, we’re leveraging our brands, platforms and capabilities to drive long-term value and return on investmentconsumers for our shareholders.Malware IncidentOn June 27, 2017, a global malware incident impacted our business. The malware affected a significant portion of our global sales, distributionsnacks, food and financial networks. Duringbeverage products. However, the last four days of the second quarter and early third quarter,elevated consumer demand we executed business continuity and contingency plans to contain the impact, minimize the damages and restore our systems environment. We do not expect, norexperienced to date have we found, any instances of Companymay not continue. We are unable to predict with certainty how long the sustained demand will last or personal data released externally. We restored our main operating systems and processes andhow significant it will be. In the near term, we continue to expect lower revenues in some markets that have a higher concentration of traditional trade outlets (such as small family-run stores), our gum and candy categories (which are more instant consumption in nature), as well as our world travel retail (such as international duty-free stores) and foodservice businesses. These businesses and different markets may also recover from the COVID-19 outbreak at different rates depending on many factors including vaccination levels. As we continue to proactively manage our business in response to the evolving impacts of the pandemic, we will continue to communicate with and support our employees and customers; monitor and take steps to further enhancesafeguard our supply chain, operations, technology and assets; protect our liquidity and financial position; work toward our strategic priorities and monitor our financial performance. We seek to position the securityCompany to withstand the current uncertainties related to this pandemic and to emerge stronger.systems.Forownership interest by 0.5% to 13.1% of the secondtotal outstanding shares. We received $185 million of proceeds and recorded a pre-tax gain of $71 million (or $54 million after-tax) during the first quarter of 2020. Subsequently, on August 3, 2020, we estimate thatsold approximately 14.1 million shares and on September 9, 2020, we sold approximately 12.5 million shares, which in the malware incident had a negative impactaggregate reduced our KDP ownership interest to 11.2% of 2.3% on our net revenue growth and 2.4% on our Organic Net Revenue growth. While we are pleased with our recovery efforts following the malware incident, restoring our North America systems has taken longer, resulting in additional lost revenue for the year. As a result, fortotal outstanding shares. During the third quarter of 2020, we estimate that the recoveryreceived $777 million of shipments delayed dueproceeds and recorded pre-tax gains of $335 million (or $258 million after-tax). On November 17, 2020, we also sold approximately 40.0 millionthe malware incident had8.4%. We received $1,132 million of proceeds and recorded a net favorable impactpretax gain of 0.6% on our net revenue and Organic Net Revenue growth. We also incurred incremental expenses of $47$459 million as a result of the incident in the three months and $54(or $350 million in the nine months ended September 30, 2017. We expect to incur additional incremental expenses related to the incident and recovery processafter tax) during the fourth quarter of 2017.Summary2020. The cash taxes associated with the KDP share sales were paid in 2020.ResultsNet revenues increased 2.1% to $6.5 billion2020, in connection with the JDE Peet's offering of its ordinary shares, we exchanged our 26.4% ownership interest in JDE for a 26.5% equity interest in JDE Peet’s. On May 29, 2020, we participated in the JDE Peet's offering and, with the subsequent exercise of the over-allotment option, we sold a total of approximately 11.1 million shares during the second quarter of 2020, retaining a 22.9% ownership interest in JDE Peet's. We received €350 million ($394 million) of total proceeds from the sales of JDE Peet's shares and we recorded a preliminary pre-tax gain of $121 million during the second quarter of 2020. We also incurred a $261 million tax expense that is payable in 2020 and 2021. During the third quarter of 20172020, we increased our preliminary gain by $10 million to $131 million. During the fourth quarter of 2020, we reduced our tax expense by $11 million to $250 million. Consistent with our accounting for KDP and decreased 1.2%in connection with JDE Peet's becoming a public company, during the second quarter of 2020, we changed our accounting principle to $18.9reflect our share of JDE historical results and JDE Peet's ongoing results on a one-quarter lag basis while we continue to record dividends when cash is received. We determined a lag was preferable as it enables us to continue to report our quarterly and annual results on a timely basis and to record our share of JDE Peet's ongoing results once JDE Peet's has publicly reported its results. This change was applied retrospectively to all periods presented.ninethree months of 20172021 as compared to the same periodsperiod in the prior year. In the first quarter of 2021, within our developed markets, demand for our biscuits and chocolate products grew, though at a more moderate rate than in the same prior-year period, as we continued to see increased food purchases for in-home consumption due to the ongoing COVID-19 pandemic. In our emerging markets, the initial negative impacts we experienced from COVID-19 have subsided, resulting in a return to strong revenue growth across most of our key markets. However, the sharp reduction in global travel due to the pandemic continued to negatively impact our world travel retail business, and lower out-of-home consumption continued to negatively impact sales of our gum and candy products and our foodservice business. Our net revenue growth was positively impacted by favorable currency translation, higher net pricing, incremental net revenues from acquisitions and favorable volume/mix.third quarterfirst three months of 2017,2021, Organic Net Revenue grew due to higher net pricing and favorable volume/mix. Refer to our Discussion and Analysis of Historical Results below for additional information. Organic Net Revenue is on a constant currency basis and excludes revenue growthfrom acquisitions and divestitures. We use Organic Net Revenue as it provides improved year-over-year comparability of our underlying operating results (see the definition of Organic Net Revenue and our reconciliation with net revenues within Non-GAAP Financial Measures appearing later in this section).positively affectedprimarily driven by favorable year-over-year mark-to-market impacts from currency and commodity derivatives, an increase in Adjusted EPS and lapping the prior-year loss on interest rate swaps, partially offset by a loss on debt extinguishment, higher Simplify to Grow program costs and lapping the prior-year gain on equity method investment transactions.U.S. dollar weakened against several currenciesdefinition of Adjusted EPS and our reconciliation with diluted EPS within Non-GAAP Financial Measures appearing later in which we operate compared to exchange rates in the prior year, as well as the recovery of shipments delayed in the second quarter as a result of the malware incident.this section).•Organic Net Revenue, a non-GAAP financial measure on a constant currency basis, increased 2.8% to $6.4 billion in the third quarter of 2017 and increased 0.3% to $18.8 billion in the first nine months of 2017 as compared to the same periods in the prior year after recasting all periods to exclude the operating results from divestitures and an acquisition. (Refer toNon-GAAP Financial Measures appearing later in this section and Note 2,Divestitures and Acquisitions,for additional information.) We use Organic Net Revenue as it provides improved year-over-year comparability of our underlying results (see the definition of Organic Net Revenue and our reconciliation with net revenues withinNon-GAAP Financial Measures appearing later in this section).•Diluted EPS attributable to Mondelēz International increased 85.7% to $0.65 in the third quarter of 2017 and increased 39.4% to $1.38 in the first nine months of 2017 as compared to the same periods in the prior year. During the third quarter and the first nine months of 2017, a benefit from the resolution of a Brazilian indirect tax matter and a gain on a divestiture significantly contributed to the increase in diluted EPS. See ourDiscussion and Analysis of Historical Resultsappearing later in this section for further details.•Adjusted EPS, a non-GAAP financial measure, increased 14.0% to $0.57 in the third quarter of 2017 and increased 10.6% to $1.57 in the first nine months of 2017 as compared to the same periods in the prior year after recasting all periods to exclude the operating results from divestitures and historical mark-to-market impacts. On a constant currency basis, Adjusted EPS increased 12.0% to $0.56 in the third quarter of 2017 and increased 12.0% to $1.59 in the first nine months of 2017. We use Adjusted EPS as it provides improved year-over-year comparability of our underlying results (see the definition of Adjusted EPS and our reconciliation with diluted EPS withinNon-GAAP Financial Measures appearing later in this section). See ourDiscussion and Analysis of Historical Resultsappearing later in this section for further details.such as margins internallyparticularly growth in profit dollars, to evaluate and manage our business and to plan and make near- and long-term operating and strategic decisions. As such, we believe these metrics are useful to investors as they provide supplemental information in addition to our U.S. GAAPGenerally Accepted Accounting Principles ("U.S. GAAP") financial results. We believe providingit is useful to provide investors with the same financial information that we use internally ensures that investors have the same data to make comparisons of our historical operating results, identify trends in our underlying operating results and gain additional insight and transparency on how we evaluate our business. We believe our non-GAAP financial measures should always be considered in relation to our GAAP results, and weresults. We have provided reconciliations between our GAAP and non-GAAP financial measures inNon-GAAP Financial Measures, which appears later in this section.2016. Weak category growth2020 and discussed in the footnotes to our financial statements.global commodity and currency markets continue. As noted above, the malware incident resulted in an unfavorable impact to our 2017 revenue. We also expect to incur additional incremental expenses related to the incident and recovery process during the fourth quarter of 2017.COVID-19 outbreak is largely resolved.planned exit fromand E.U. that began on January 1, 2021. The main trade provisions include the continuation of no tariffs or quotas on trade between the U.K. and E.U. (Brexit)subject to prescribed trade terms. We also need to meet product and its impactlabeling standards for both the U.K. and E.U. Cross-border trade between the U.K. and E.U. is now subject to new customs regulations, documentation and reviews. Our supply chain in this market relies on our resultsimports of raw and packaging materials as well as currenciesfinished goods. To date, we have not experienced significant delays at riskU.K.-E.U. border crossings. To comply with the new requirements, we increased resources in customer service and logistics, in our factories, and on our customs support teams. We adapted our processes and systems for the new and increased number of potential highly inflationary accounting, such as the Argentinian peso and the Ukrainian hryvnia. In connection with collective bargaining agreements covering eight U.S. facilities that expired on February 29, 2016, wecustoms transactions. We continue to work toward reaching an agreementclosely monitor and manage our inventory levels of imported raw materials, packaging and finished goods in the U.K. If the U.K.’s separation from, or newunionE.U. negatively impact the U.K. economy or result in disagreements on trade terms, delays affecting our supply chain or distribution, or disruptions to sales or collections, the impact to our results of operations, financial condition and cash flows could be material. In the three months ended March 31, 2021, we generated 9.9% of our consolidated net revenues in the U.K.made plansrecorded. In the United States, while the 2017 U.S. tax reform reduced the U.S. corporate tax rate and included some beneficial provisions, other provisions have, and will continue to ensure business continuity duringhave, an adverse effect on our results. Refer to our Annual Report on Form 10-K for the re-negotiations. Foryear ended December 31, 2020 for more information on these items, refer to ourDiscussionSwiss and Analysis of Historical Results andCommodity Trends appearing laterU.S. tax reform.this section, as well as Note 1,Basis of Presentation– Currency Translation and Highly Inflationary Accounting,we continue to apply highly inflationary accounting for our Argentinean subsidiaries. During the three months ended March 31, 2021, we recorded a remeasurement loss of $5 million within selling, general and Note 6,2014-2018 Restructuring Program. pre-tax results of operations and our effective tax rates. Please refer to the notes to the condensed consolidated financial statements indicated below for more information. Refer also to theConsolidated Results of Operations – Net Earnings and Earnings per Share Attributable to Mondelēz International table for the after-tax per share impacts of these items. For the Three Months Ended
September 30, For the Nine Months Ended
September 30, See Note 2017 2016 2017 2016 (in millions, except percentages) Note 2 $ – $ – $ – $ 43 Note 6 (113 ) (187 ) (418 ) (480 ) (62 ) (114 ) (179 ) (286 ) Note 7 & 8 – – – (97 ) Note 7 – – (11 ) – Note 5 (71 ) (4 ) (109 ) (30 ) Note 2 187 – 184 – – 7 – 13 2 – (26 ) (84 ) – 7 – 46 Note 15 28 (12 ) (69 ) (49 ) Note 11 215 – 273 – (47 ) – (54 ) – Note 13 23.4 % 7.2 % 21.3 % 13.6 % (1)Refer to Note 11,Commitments and Contingencies – Tax Matters, for more information. During the first quarter of 2017, we recorded a $58 million gain on the settlement of a pre-acquisition Cadbury tax matter and during the third quarter of 2017, we recorded additional income of $3 million. During the third quarter of 2017, we recorded a $212 million reversal of tax liabilities in connection with the resolution of a Brazilian indirect tax matter, with $153 million in operating income and $59 million in interest income. For the Three Months Ended
March 31, See Note 2021 2020 (in millions, except percentages) Simplify to Grow Program Note 7 Restructuring charges $ (88) $ (15) Implementation charges (34) (43) Note 9 117 (184) Acquisitions: Acquisition integration costs (1) — Acquisition-related costs (7) (5) Gain on acquisition 9 — Remeasurement of net monetary position Note 1 (5) (2) Note 10 (4) (3) Loss related to interest rate swaps Note 8 & 9 — (103) Loss on debt extinguishment Note 8 (137) —
transactions (2)Note 6 (7) 71 (16) (6) Note 14 19.1 % 21.2 % The following discussion compares our consolidated results of operations for the three months ended September 30, 2017 and 2016.September 30: For the Three Months Ended September 30, 2017 2016 $ change % change (in millions, except per share data) $ 6,530 $ 6,396 $ 134 2.1% 1,181 702 479 68.2% 992 548 444 81.0% 0.65 0.35 0.30 85.7% For the Three Months Ended
March 31, 2021 2020 $ change % change (in millions, except per share data) Net revenues $ 7,238 $ 6,707 $ 531 7.9 % Operating income 1,283 856 427 49.9 % 961 736 225 30.6 % 0.68 0.51 0.17 33.3 % $134$531 million (2.1%(7.9%) to $6,530$7,238 million in the thirdfirst quarter of 2017,2021, and Organic Net Revenue(1) increased $176$257 million (2.8%(3.8%) to $6,416$6,964 million. Power BrandsDeveloped markets net revenuesrevenue increased 5.6%, including a favorable currency impact,9.0% and Power Brandsdeveloped markets Organic Net Revenue increased 3.8%0.4% (1). Emerging markets net revenues increased 4.5%, including an unfavorable currency impact,6.0% and emerging markets Organic Net Revenue increased 4.8%9.9% (1). The underlying changes in net revenues and Organic Net Revenue are detailed below:20172021 7.9 2.1% Favorable currency (2.4) pp Favorable currency(1.7) (1.3)ppImpact of acquisition(0.3)pp Impact of divestitures2.3pp 3.8 2.8% 2.3 1.5pp 1.5 1.3pp (1)Please see theNon-GAAP Financial Measures section at the end of this item.2.1%7.9% was driven by our underlying Organic Net Revenue increasegrowth of 2.8%3.8%, favorable currency and the impact of an acquisition, partially offsetacquisitions. Overall, our net revenues continued to be affected by the COVID-19 pandemic. In developed markets, net revenues increased as demand for our biscuits and chocolate products grew, though at a more moderate rate than in the prior-year period, reflecting continued increased food purchases for in-home consumption. However, the sharp reduction in global travel due to the pandemic continued to negatively impact our world travel retail business, and lower out-of-home consumption continued to negatively impact sales of divestitures. Our underlying our gum and candy products and our foodservice business. Incremental net revenues from acquisitions and favorable currency translation also added to our developed markets revenue growth in the quarter. In emerging markets, the negative initial impacts we experienced from COVID-19 have subsided, resulting in a return to strong revenue growth across most of our key markets though some markets were still challenged, particularly those with significant gum and candy portfolios. In addition, unfavorable currency translation tempered emerging markets growth in the quarter.increasegrowth was driven by higher net pricing and favorable volume/mix, including the recovery of shipments delayed as a result of the second quarter malware incident that we estimate had a positive impact of 0.6% on ourmix. Higher net revenue and Organic Net Revenue growth. Net pricing in all regions was up, which includeddue to the benefit of carryover pricing from 2016 and the first half of 20172020 as well as the effects of input cost-driven pricing actions taken during the third quarterfirst three months of 2017. Higher net pricing was reflected in all segments except Europe.2021. Favorable volume/mix was reflected in AMEA and Europe, and North America,driven by strong volume gains, was partially offset by declinesunfavorable volume/mix in LatinNorth America and AMEA.Latin America. Favorable year-over-year currency impacts increased net revenues by $80$160 million, due primarily to the strength of several currencies relative to the U.S. dollar, including the euro, Russian ruble, Brazilian real,British pound sterling, Australian dollar, Chinese yuan, Canadian dollar and Indian rupee,Swedish krona, partially offset by the strength of the U.S. dollar relative to several currencies, including the Egyptian poundBrazilian real, Argentinean peso and Argentinian peso.Russian ruble. The November 2, 2016April 1, 2020 acquisition of a business and license to manufacture, market and sell Cadbury-branded biscuits in additional key marketsGive & Go added $20 million (constant currency basis) of incremental net revenues forof $106 million and the third quarterJanuary 4, 2021 acquisition of 2017. The impact of divestitures resulted in a year-over-year decline inHu Master Holdings added incremental net revenues of $142 million $8 million. Refer to Note 2, Acquisitions and Divestitures, for the third quarteradditional information.$479$427 million (68.2%(49.9%) to $1,181$1,283 million in the thirdfirst quarter of 2017,2021. Adjusted Operating Income(1) increased $126$186 million (12.9%(16.8%) to $1,100$1,292 million and Adjusted Operating Income on a constant currency basis(1) increased $106$142 million (10.9%(12.8%) to $1,080$1,248 million due to the following: Operating
Income % Change (in millions) $ 702 301 4 12 (37 ) (7 ) (1 )
Three Months Ended September 30, 2016 $ 974 93 (68 ) 14 107 (34 ) (7 ) 1 106 10.9% 20 126 12.9%
Three Months Ended September 30, 2017 $ 1,100 (175 ) (71 ) 28 (47 ) (1 ) 4 187 155 1 $ 1,181 68.2% (1)Refer to theNon-GAAP Financial Measures section at the end of this item.(2)Refer to Note 6,2014-2018 Restructuring Program, for more information.(3)Refer to Note 2,Divestitures and Acquisitions, and Note 5,Goodwill and Intangible Assets, for more information on trademark impairments.(4)Refer to Note 8,Financial Instruments, Note 15,Segment Reporting, andNon-GAAP Financial Measures appearing later in this section for more information on the unrealized gains/losses on commodity and forecasted currency transaction derivatives.(5)Refer to Note 2,Divestitures and Acquisitions, for more information on the 2017 sales of a confectionery business in France and a grocery business in Australia and New Zealand and 2016 sales of property. Refer to our Annual Report on Form 10-K for the year ended December 31, 2016 for more information on the 2016 sale of a confectionery business in Costa Rica.(6)Refer to Note 2,Divestitures and Acquisitions, for more information on the 2016 intangible asset sale in Finland.(7)Refer to Note 2,Divestitures and Acquisitions, for more information on the 2016 purchase of a license to manufacture, market and sell Cadbury-branded biscuits in additional key markets and other property sale in 2016.(8)Refer to our Annual Report on Form 10-K for the year ended December 31, 2016, for information on the acquisition of a biscuit business in Vietnam.(9)Refer to Note 11,Commitments and Contingencies – Tax Matters, for more information on the reversal of tax liabilities in connection with the resolution of a Brazilian indirect tax matter and settlement of a pre-acquisition Cadbury tax matter. Operating
Income% Change (in millions) Operating Income for the Three Months Ended March 31, 2020 $ 856 58 185 5 2 $ 1,106 Higher net pricing 151 Higher input costs (49) Favorable volume/mix 6 Lower selling, general and administrative expenses 19 15 142 12.8 % Favorable currency translation 44 186 16.8 % $ 1,292 (122) 118 (1) (7) 9 (5) Impact from pension participation changes (1) Operating Income for the Three Months Ended March 31, 2021 $ 1,283 49.9 % thirdfirst quarter of 2021, we realized higher net pricing asand favorable volume/mix, which was partially offset by increased input costs increased modestly.costs. Higher net pricing, which included the carryover impact of pricing actions taken in 2016 and the first half of 20172020 as well as the effects of input cost-driven pricing actions taken during the third quarterfirst three months of 2017,2021, was reflected across all regions. Volume/mix benefited from increased food purchases for in-home consumption though at a more moderate rate than the same period last year, but the sharp reduction in all segments except Europe.global travel due to the pandemic continued to negatively impact our world travel business, while lower out-of-home consumption continued to negatively impact sales of our gum and candy products and our foodservice business. Overall, favorable volume/mix was driven by AMEA and Europe, mostly offset by unfavorable volume/mix in North America and Latin America. The increase in input costs was driven by higher raw material costs, which were partially offset by lower manufacturing costs due todriven by productivity gains. Favorable volume/mix,net of incremental COVID-19 related costs. Higher raw material costs were in part due to the recovery of shipments delayedhigher currency exchange transaction costs on imported materials, as a result of the second quarter malware incident, was driven by Europe,well as higher cocoa, sugar, oils, packaging, grains, nuts and other ingredients costs, partially offset by unfavorable volume/mix in AMEA, Latin Americalower costs for dairy and North America.decreased $222increased $27 million from the thirdfirst quarter of 2016,2020, due to a number of factors noted in the table above, including in part, an unfavorable currency impact related to expenses, the benefit from the resolutionimpact of a Brazilian indirect tax matteracquisitions, higher remeasurement loss of net monetary position and higher acquisition-related costs, which were partially offset by lower implementation costs incurred for the 2014-2018 RestructuringSimplify to Grow Program. The decreases were partially offset by the VAT-related settlement in 2016, an unfavorable currency impact, incremental expenses related to the malware incident and the gains on sales of property in 2016.thethese factors, noted above, selling, general and administrative expenses decreased $107$19 million from the thirdfirst quarter of 2016.2020. The decrease was driven primarily by lower overhead costs primarily due to continued cost reduction efforts.impactschanges increased operating income by $20$44 million due primarily to the strength of several currencies relative to the U.S. dollar, including the euro, Russian ruble, Brazilian real, Indian rupeeBritish pound sterling, Australian dollar and Australian dollar,Chinese yuan, partially offset by the strength of the U.S. dollar relative to several currencies, including the Egyptian poundBrazilian real and Argentinian peso.11.0%12.8% in the thirdfirst quarter of 20162020 to 18.1%17.7% in the thirdfirst quarter of 2017.2021. The increase in operating income margin was driven primarily by the net gain on divestitures, the benefit from the resolution of a Brazilian indirect tax matter, lower 2014-2018 Restructuring Program costs, an increasefavorable year-over-year change in our Adjusted Operating Income margin and the year-over-year favorable impact of unrealizedmark-to-market gains/(losses) onfrom currency and commodity hedging activities and higher Adjusted Operating Income margin, partially offset by higher intangible asset impairment charges, incremental costs relatedSimplify to the malware incident and the impact from divestitures.Grow program costs. Adjusted Operating Income margin increased from 15.6% in16.5% for the thirdfirst quarter of 20162020 to 16.9% in17.9% for the thirdfirst quarter of 2017.2021. The increase in Adjusted Operating Income margin was driven primarily by higher net pricing, lower overheads from continued cost reduction efforts.$992$961 million increased by $444$225 million (81.0%(30.6%) in the thirdfirst quarter of 2017.2021. Diluted EPS attributable to Mondelēz International was $0.65$0.68 in the thirdfirst quarter of 2017,2021, up $0.30 (85.7%$0.17 (33.3%) from the thirdfirst quarter of 2016.2020. Adjusted EPS(1) was $0.57$0.77 in the thirdfirst quarter of 2017,2021, up $0.07 (14.0%$0.11 (16.7%) from the thirdfirst quarter of 2016.2020. Adjusted EPS on a constant currency basis(1) was $0.56$0.73 in the thirdfirst quarter of 2017,2021, up $0.06 (12.0%$0.07 (10.6%) from the thirdfirst quarter of 2016. Diluted EPS
Three Months Ended September 30, 2016 $ 0.35 0.14 – – (0.02 ) – 0.03 $ 0.50 0.08 0.01 (0.02 ) – – 0.03 0.02 (0.06 ) $ 0.56 0.01 $ 0.57 (0.08 ) (0.04 ) 0.02 (0.02 ) (0.01 ) – 0.12 0.09 –
Three Months Ended September 30, 2017 $ 0.65 (1)Refer to theNon-GAAP Financial Measures section appearing later in this section.(2)See theOperating Income table above and the related footnotes for more information.(3)Includes our proportionate share of unusual or infrequent items, such as acquisition and divestiture-related costs and restructuring program costs, recorded by our JDE and Keurig equity method investees.(4)Excludes the currency impact on interest expense related to our non-U.S. dollar-denominated debt which is included in currency translation.(5)Refer to Note 10,Stock Plans, for more information on our equity compensation programs and share repurchase program and Note 14,Earnings Per Share, for earnings per share weighted-average share information.(6)Refer to Note 10,Stock Plans, for more information on a $7 million earnings impact (in the provision for income taxes) in the third quarter of 2017 related to adopting a new stock-based compensation accounting standard in 2017 and Note 13,Income Taxes, for more information on the change in our income taxes and effective tax rate.(7)Refer to Note 2,Divestitures and Acquisition, for more information on the sale of a grocery business in Australia and New Zealand and related taxes as well as a related gain on a foreign currency hedge.Nine Months Ended September 30: For the Nine Months Ended
September 30, 2017 2016 $ change % change (in millions, except per share data) $ 18,930 $ 19,153 $ (223 ) (1.2)% 2,662 2,062 600 29.1% 2,120 1,566 554 35.4% 1.38 0.99 0.39 39.4% Net Revenues– Net revenues decreased $223 million (1.2%) to $18,930 million in the first nine months of 2017, and Organic Net Revenue(1) increased $55 million (0.3%) to $18,766 million. Power Brands net revenues increased 1.4%, including an unfavorable currency impact, and Power Brands Organic Net Revenue increased 1.5%. Emerging markets net revenues increased 2.4%, including an unfavorable currency impact, and emerging markets Organic Net Revenue increased 2.7%. The underlying changes in net revenues and Organic Net Revenue are detailed below:2017Change in net revenues (by percentage point)Total change in net revenues(1.2)% Diluted EPSAdd back the following items affecting comparability:Impact of divestitures$ 0.51 1.0pp Unfavorable currency0.03 0.8pp Impact of acquisitions(0.3)pp Total change in Organic Net Revenue(1)0.11 0.3% Higher net pricing(0.01) 1.2pp Unfavorable volume/mix(0.9)pp (1)Please see theNon-GAAP Financial Measures section at the end of this item.Net revenue decline of 1.2% was driven by the impact of divestitures and unfavorable currency, partially offset by our underlying Organic Net Revenue growth of 0.3% and the impact of an acquisition. The impact of divestitures resulted in a year-over-year decline in net revenues of $193 million for the first nine months of 2017. Unfavorable year-over-year currency impacts decreased net revenues by $135 million, due primarily to the strength of the U.S. dollar relative to several currencies, including the British pound sterling, Egyptian pound, Argentinian peso, Nigerian naira, Turkish lira and Chinese yuan, partially offset by the strength of several currencies relative to the U.S. dollar, including the Brazilian real, Russian ruble, South African rand and Australian dollar. Our underlying Organic Net Revenue increase was driven by higher net pricing, partially offset by unfavorable volume/mix. Net pricing was up, which includes the benefit of carryover pricing from 2016 as well as the effects of input cost-driven pricing actions taken during 2017. Higher net pricing was reflected in Latin America and AMEA, partially offset by lower net pricing in Europe and North America. Unfavorable volume/mix was reflected in all segments except Europe, in part due to expected shipments that we did not realize following the second quarter malware incident. The November 2, 2016 acquisition of a business and license to manufacture, market and sell Cadbury-branded biscuits in additional key markets added $50 million (constant currency basis) of incremental net revenues for the first nine months of 2017.Operating Income – Operating income increased $600 million (29.1%) to $2,662 million in the first nine months of 2017, Adjusted Operating Income(1) increased $192 million (6.7%) to $3,075 million and Adjusted Operating Income on a constant currency basis(1) increased $245 million (8.5%) to $3,128 million due to the following: Operating
Income % Change (in millions) $ 2,062 766 30 49 6 84 (99 ) (13 ) (2 )
Nine Months Ended September 30, 2016 $ 2,883 233 (116 ) (140 ) 315 (46 ) (34 ) 27 7 (1 ) 245 8.5% (53 ) 192 6.7%
Nine Months Ended September 30, 2017 $ 3,075 (597 ) (109 ) (69 ) (54 ) (2 ) (23 ) 55 184 201 1 $ 2,662 29.1% (1)Refer to theNon-GAAP Financial Measures section at the end of this item.(2)Refer to Note 6,2014-2018 Restructuring Program, for more information.(3)Refer to Note 2,Divestitures and Acquisitions, and Note 5,Goodwill and Intangible Assets, for more information on trademark impairments.(4)Refer to Note 8,Financial Instruments, Note 15,Segment Reporting, andNon-GAAP Financial Measures appearing later in this section for more information on the unrealized losses on commodity and forecasted currency transaction derivatives.(5)Refer to our Annual Report on Form 10-K for the year ended December 31, 2016, for information on the acquisition of a biscuit business in Vietnam.(6)Refer to Note 2,Divestitures and Acquisitions, for more information on the 2017 sales of a confectionery business in France and a grocery business in Australia and New Zealand. Refer to our Annual Report on Form 10-K for the year ended December 31, 2016 for more information on the 2016 sale of a confectionery business in Costa Rica.(7)Refer to Note 2,Divestitures and Acquisitions, for more information on the 2016 intangible asset sale in Finland.(8)Refer to Note 2,Divestitures and Acquisitions, for more information on the 2016 purchase of a license to manufacture, market and sell Cadbury-branded biscuits in additional key markets and other property sales in 2016.(9)Refer to Note 11,Commitments and Contingencies – Tax Matters, for more information on the settlement of a pre-acquisition Cadbury tax matter and the reversal of tax liabilities in connection with the resolution of a Brazilian indirect tax matter.During the first nine months of 2017, we realized higher net pricing while input costs increased modestly. Higher net pricing, which included the carryover impact of pricing actions taken in 2016 and the first half of 2017 as well as the effects of input cost-driven pricing actions taken during the third quarter of 2017, was driven by Latin America and AMEA, partially offset by lower net pricing in Europe and North America. The increase in input costs was driven by higher raw material costs which were partially offset by lower manufacturing costs due to productivity. Unfavorable volume/mix, in part due to expected shipments that we did not realize following the second quarter malware incident, was driven by North America, AMEA, and Latin America, which was partially offset by favorable volume/mix in Europe.Total selling, general and administrative expenses decreased $581 million from the first nine months of 2016, due to a number of factors noted in the table above, including in part, the benefits from the resolution of tax matters, lower implementation costs incurred for the 2014-2018 Restructuring Program, lower divestiture-related costs and a property insurance recovery in AMEA. The decreases were partially offset by higher intangible asset impairment charges, gains on sales of property in 2016 and incremental expenses incurred due to the malware incident.Excluding the factors noted above, selling, general and administrative expenses decreased $315 million from the first nine months of 2016. The decrease was driven primarily by lower overhead costs and lower advertising and consumer promotion costs due to continued cost reduction efforts in both areas.Unfavorable currency impacts decreased operating income by $53 million, due primarily to the strength of the U.S. dollar relative to several currencies, including the Egyptian pound and British pound sterling, partially offset by the strength of several currencies relative to the U.S. dollar, including the Brazilian real, Russian ruble, Australian dollar and South African rand.Operating income margin increased from 10.8% in the first nine months of 2016 to 14.1% in the first nine months of 2017. The increase in operating income margin was driven primarily by an increase in our Adjusted Operating Income margin, the benefits from the resolution of tax matters, the net gain on divestitures, lower 2014-2018 Restructuring Program costs and lower divestiture-related costs, partially offset by higher intangible asset impairment charges, incremental costs the malware incident and the year-over-year unfavorable impact of unrealized gains/(losses) on currency and commodity hedging activities. Adjusted Operating Income margin increased from 15.4% in the first nine months of 2016 to 16.5% in the first nine months of 2017. The increase in Adjusted Operating Income margin was driven primarily by lower overheads and lower advertising and consumer promotion costs due to continued cost reduction efforts in both areas.Net Earnings and Earnings per Share Attributable to Mondelēz International– Net earnings attributable to Mondelēz International of $2,120 million increased by $554 million (35.4%) in the first nine months of 2017. Diluted EPS attributable to Mondelēz International was $1.38 in the first nine months of 2017, up $0.39 (39.4%) from the first nine months of 2016. Adjusted EPS(1) was $1.57 in the first nine months of 2017, up $0.15 (10.6%) from the first nine months of 2016. Adjusted EPS on a constant currency basis(1) was $1.59 in the first nine months of 2017, up $0.17 (12.0%) from the first nine months of 2016. Diluted EPS
Nine Months Ended September 30, 2016 $ 0.99 0.36 0.01 0.03 0.04 (0.05 ) – 0.04 (0.03 ) 0.03 $ 1.42 0.16 0.01 (0.02 ) (0.02 ) 0.01 – 0.06 0.04 (0.07 ) $ 1.59 (0.02 ) $ 1.57 (0.29 ) (0.05 ) (0.04 ) (0.02 ) (0.02 ) 0.03 0.11 – 0.13 (0.01 ) (0.03 )
Nine Months Ended September 30, 2017 $ 1.38 (1)Refer to theNon-GAAP Financial Measures section at the end of this item.(2)See theOperating Income table above and the related footnotes for more information.(3)Refer to Note 8,Financial Instruments, for more information on our interest rate swaps which we no longer designated as cash flow hedges during the first quarter of 2016 due to changes in financing and hedging plans.(4)0.06 (4)Refer to Note 2,Divestitures and Acquisitions – Keurig Transaction, for more information the 2016 acquisition of an interest in Keurig.(5)Includes our proportionate share of unusual or infrequent items, such as acquisition and divestiture-related costs and restructuring program costs, recorded by our JDE and Keurig equity method investees.investment transactions (5)(0.04) (6)Excludescurrency impact on interest expense related to our non-U.S. dollar-denominated debt which is includedThree Months Ended March 31, 2020$ 0.66 Increase in currency translation.operations0.08 Decrease in equity method investment net earnings (7)(0.01)Refer to Note 10,Stock Plans, for more information on our equity compensation programs and share repurchase program and Note 14,Earnings Per Share, for earnings per share weighted-average share information.(8)Refer to Note 10,Stock Plans, for more information on a $31 million earnings impact (in the provision for income taxes) the first nine months of 2017 related to adopting a new stock-based compensation accounting standard in 2017 and Note 13,Income Taxes, for more information on the change in our income taxes and effective tax rate.(6)(0.01) (9)0.01 Refer$ 0.73 Favorable currency translation 0.04 $ 0.77 Note 7,Debt and Borrowing Arrangements, for more information on our lossGrow Program (2)(0.07) 0.07 (0.01) in connection with our debt discharge.(8)(0.07) (0.01) $ 0.68 reportable operating segments:On October 1, 2016, we integrated our EEMEA operating segment into our Europe and Asia Pacific operating segments to further leverage and optimize the operating scale built within the Europe and Asia Pacific regions. Russia, Ukraine, Turkey, Belarus, Georgia and Kazakhstan were combined within our Europe operating segment, while the remaining Middle East and African countries were combined within our Asia Pacific region to form a new AMEA operating segment. We have reflected the segment change as if it had occurred in all periods presented.inacross our key markets. Our regional management teams have responsibility for the business, product categories and financial results in the regions.15,16, Segment Reporting,for additional information on our segments andItems Affecting Comparability of Financial Results earlier in this section for items affecting our segment operating results.revised to reflect our new segment structure in all periods, were: For the Three Months Ended
September 30, For the Nine Months Ended
September 30, 2017 2016 2017 2016 (in millions) $ 908 $ 868 $ 2,666 $ 2,528 1,405 1,443 4,290 4,404 2,442 2,332 6,978 7,073 1,775 1,753 4,996 5,148 $ 6,530 $ 6,396 $ 18,930 $ 19,153 $ 255 $ 92 $ 469 $ 191 82 165 425 504 410 316 1,158 924 318 274 824 840 28 (12 ) (69 ) (49 ) (54 ) (89 ) (196 ) (216 ) (45 ) (44 ) (133 ) (132 ) 187 – 184 – 1,181 702 2,662 2,062 (19 ) (145 ) (262 ) (540 ) $ 1,162 $ 557 $ 2,400 $ 1,522 For the Three Months Ended
March 31, 2021 2020 (in millions) Net revenues: Latin America $ 669 $ 726 AMEA 1,745 1,502 Europe 2,847 2,584 North America 1,977 1,895 Net revenues $ 7,238 $ 6,707
Earnings before income taxes:Operating income: Latin America $ 76 $ 78 AMEA 362 234 Europe 557 472 North America 270 381 Unrealized gains/(losses) on hedging activities
(mark-to-market impacts)118 (185) General corporate expenses (64) (76) Amortization of intangibles (38) (43) Gain on acquisition 9 — Acquisition-related costs (7) (5) Operating income 1,283 856 Benefit plan non-service income 44 33 Interest and other expense, net (218) (190) Earnings before income taxes $ 1,109 $ 699 �� For the Three Months Ended September 30, 2017 2016 $ change % change (in millions) $ 908 $ 868 $ 40 4.6% 255 92 163 177.2% For the Nine Months Ended September 30, 2017 2016 $ change % change (in millions) $ 2,666 $ 2,528 $ 138 5.5% 469 191 278 145.5% For the Three Months Ended
March 31, 2021 2020 $ change % change (in millions) Net revenues $ 669 $ 726 $ (57) (7.9) % Segment operating income 76 78 (2) (2.6) % September 30:increased $40decreased $57 million (4.6%(7.9%), due to higher net pricing (8.3 pp), partially offset by unfavorable volume/mix (2.9 pp), unfavorable currency (0.6 pp) and the impact of a divestiture (0.2 pp). Higher net pricing was reflected across all categories driven primarily by Brazil, Argentina and Mexico. Despite the benefit from the recovery of shipments delayed due to the second quarter malware incident, unfavorable volume/mix occurred across most of the region and was largely due to the impact of pricing-related elasticity. Unfavorable volume/mix was driven by declines in refreshment beverages, gum and cheese & grocery, partially offset by gains in chocolate, biscuits and candy. Unfavorable currency impacts were due primarily to the strength of the U.S. dollar relative to the Argentinian peso, partially offset by the strength of the Brazilian real and Mexico peso relative to the U.S. dollar. On December 1, 2016, we sold a small confectionery business in Costa Rica.Segment operating income increased $163 million (177.2%), primarily due to the benefit from the resolution of a Brazilian indirect tax matter of $153 million, higher net pricing and lower manufacturing costs. These favorable items were partially offset by higher raw material costs, higher advertising and consumer promotion costs, unfavorable volume/mix, higher costs incurred for the 2014-2018 Restructuring Program, higher other selling, general and administrative expenses and an intangible asset impairment charge.Nine Months Ended September 30:Net revenues increased $138 million (5.5%), due to higher net pricing (7.4 pp) and favorable currency (2.8 pp), partially offset by unfavorable volume/mix (4.5 pp) and the impact of a divestiture (0.2 pp). Higher net pricing was reflected across all categories driven primarily by Argentina, Brazil and Mexico. Favorable currency impacts were due primarily to the strength of several currencies in the region relative to the U.S. dollar, primarily the Brazilian real, partially offset by the strength of the U.S. dollar relative to the Argentinian peso and Mexican peso. Unfavorable volume/mix, which occurred across most of the region, was largely due to the impact of pricing-related elasticity. In addition, only a portion of the shipments delayed at the end of the second quarter due to the malware incident was recovered. Unfavorable volume/mix was driven by declines in all categories except chocolate and candy. On December 1, 2016, we sold a small confectionery business in Costa Rica.Segment operating income increased $278 million (145.5%), primarily due to higher net pricing, the benefit from the resolution of a Brazilian indirect tax matter of $153 million, lower manufacturing costs, favorable currency, lower other selling, general and administrative expenses and lower advertising and consumer promotion costs. These favorable items were partially offset by higher raw material costs, unfavorable volume/mix and an intangible asset impairment charge.AMEA For the Three Months Ended September 30, 2017 2016 $ change % change (in millions) $ 1,405 $ 1,443 $ (38 ) (2.6 )% 82 165 (83 ) (50.3 )% For the Nine Months Ended September 30, 2017 2016 $ change % change (in millions) $ 4,290 $ 4,404 $ (114 ) (2.6 )% 425 504 (79 ) (15.7 )% Three Months Ended September 30:Net revenues decreased $38 million (2.6%), due to the impact of divestitures (4.2 pp), unfavorable currency (1.3(15.1 pp) and unfavorable volume/mix (0.5(2.9 pp), partially offset by higher net pricing (3.4 pp). The impact of divestitures, primarily related to the grocery & cheese business in Australia and New Zealand that was divested on July 4, 2017, resulted in a year-over-year decline in net revenues of $60 million for the third quarter of 2017. Unfavorable currency impacts were due primarily to the strength of the U.S. dollar relative to several currencies in the region, including the Egyptian pound, Philippine peso and Japanese yen, partially offset by the strength of several other currencies in the region relative to the U.S. dollar, including the Australian dollar, Indian rupee and South African rand. Despite the benefit from the recovery of shipments delayed due to the second quarter malware incident, unfavorable volume/mix was driven by declines in all categories except biscuits. Higher net pricing was reflected across all categories.Segment operating income decreased $83 million (50.3%), primarily due to intangible asset impairment charges, higher raw material costs, higher costs incurred for the 2014-2018 Restructuring Program, unfavorable volume/mix and the impact of divestitures. These unfavorable items were partially offset by higher net pricing, lower manufacturing costs and lower advertising and consumer promotion costs.Nine Months Ended September 30:Net revenues decreased $114 million (2.6%), due to unfavorable currency (2.6 pp), the impact of divestitures (1.3 pp) and unfavorable volume/mix (1.3 pp), partially offset by higher net pricing (2.6(10.1 pp). Unfavorable currency impacts were due primarily to the strength of the U.S. dollar relative to severalmost currencies in the region including the Egyptian pound, Nigerian naira, Chinese yuan,Brazilian real and Philippine peso, partially offset by the strength of several other currencies in the region relativeArgentinean peso. Unfavorable volume/mix was due to the U.S. dollar, includingcontinued impact from the South African rand, Australian dollarCOVID-19 pandemic as lower out-of-home consumption continued to negatively impact sales of gum and Indian rupee. Thecandy products, as well as the impact of divestitures, primarily related to the grocery & cheese business in Australia and New Zealand that was divested on July 4, 2017, resulted in a year-over-year decline in net revenues of $60 million for the first nine months of 2017.pricing-related elasticity. Unfavorable volume/mix was driven by declines in cheese & grocery, refreshment beverages, gum and candy, partially offset by gains in biscuits, chocolate, refreshment beverages and chocolate. In addition, only a portion of the shipments delayed at the end of the second quarter due to the malware incident was recovered.cheese & grocery. Higher net pricing was reflected across all categories.$79$2 million (15.7%(2.6%), primarily due to higher raw material costs, unfavorable volume/mix, intangible asset impairment charges, unfavorable currency and higher costs incurred for the 2014-2018 Restructuring Programadvertising and the impact of divestitures.consumer promotion costs. These unfavorable items were partiallymostly offset by higher net pricing, lower manufacturing costs (net of incremental COVID-19 related costs), lower other selling, general and administrative expenses (including a property insurance recovery), lower manufacturing costs and lower advertising and consumer promotion costs.Europe For the Three Months Ended September 30, 2017 2016 $ change % change (in millions) $ 2,442 $ 2,332 $ 110 4.7% 410 316 94 29.7% For the Nine Months Ended September 30, 2017 2016 $ change % change (in millions) $ 6,978 $ 7,073 $ (95 ) (1.3 )% 1,158 924 234 25.3 % For the Three Months Ended
March 31, 2021 2020 $ change % change (in millions) Net revenues $ 1,745 $ 1,502 $ 243 16.2 % Segment operating income 362 234 128 54.7 % September 30:$110$243 million (4.7%(16.2%), due to favorable volume/mix (4.6(7.9 pp), favorable currency (4.1(5.4 pp) and the impact of an acquisition (0.9 pp), partially offset by the impact of divestitures (3.5 pp) and lowerhigher net pricing (1.4(2.9 pp). Favorable volume/mix includingreflected overall volume gains as the recoverynegative impacts from COVID-19 that we experienced in the prior year period subsided across most of the majority of the shipments delayed at the end of the second quarter due to the malware incident,region though some markets were still challenged, particularly those with significant gum and candy portfolios. Favorable volume/mix was driven by gains in chocolate, biscuits, candy,cheese & grocery, and refreshment beverages partially offset by declines in gum and cheese & grocery.candy. Favorable currency impacts were due to the strength of most currencies relative to the U.S. dollar, including the Australian dollar, Chinese yuan, New Zealand dollar and Philippine peso. Higher net pricing was reflected across all categories.For the Three Months Ended
March 31, 2021 2020 $ change % change (in millions) Net revenues $ 2,847 $ 2,584 $ 263 10.2 % Segment operating income 557 472 85 18.0 % severalmost currencies in the region relative to the U.S. dollar, including the euro, British pound sterling Swedish krona and Russian ruble,Norwegian krone, partially offset by the strength of the U.S. dollar against several otherrelative to a few currencies, including the Russian ruble and Turkish lira. Favorable volume/mix was due to overall higher volume, reflecting continuation of increased food purchases for in-home consumption during the pandemic, though at a more moderate rate than in the region, primarilyprior-year period. However, the Turkish lira and the British pound sterling. The November 2016 acquisition of a business and license to manufacture, market and sell Cadbury-branded biscuits added net revenues of $20 million (constant currency basis). The impact of divestitures, primarilysharp reduction in global travel due to the salepandemic continued to negatively impact our world travel retail business, and lower out-of-home consumption continued to negatively impact sales of a confectionery businessour gum and candy products and our foodservice business. Favorable volume/mix was driven by gains in France, resultedchocolate, cheese & grocery, biscuits and refreshment beverages, partially offset by declines in a year-over-year decline in net revenues of $75 million for the quarter. Lowergum and candy. Higher net pricing was reflected across all categories exceptdriven by chocolate, candy, refreshment beverages and gum, partially offset by lower net pricing in biscuits and cheese & grocery.$94$85 million (29.7%(18.0%), primarily due to lower costs incurred for the 2014-2018 Restructuring Program,favorable currency, favorable volume/mix, lower manufacturing costs, lower other selling, general and administrative expenses, favorable currency andhigher net pricing, lower advertising and consumer promotion costs.costs and lower manufacturing costs (net of incremental COVID-19 related costs). These favorable items were partially offset by higher raw material costs, lower net pricing, the impact of divestitures, incremental costs incurred due to the malware incident and higher intangible asset impairment charges.Ninecosts.For the Three Months Ended
March 31, 2021 2020 $ change % change (in millions) Net revenues $ 1,977 $ 1,895 $ 82 4.3 % Segment operating income 270 381 (111) (29.1) % September 30:decreased $95increased $82 million (1.3%(4.3%), due to the impact of divestitures (1.7 pp) unfavorable currency (1.6acquisitions (6.0 pp), favorable currency (0.6 pp) and lowerhigher net pricing (0.6(0.5 pp), partially offset by favorableunfavorable volume/mix (1.8 pp) and the impact of an acquisition (0.8(2.8 pp). The impactApril 1, 2020 acquisition of divestitures, primarily due to the sale of a confectionery business in France, resulted in a year-over-year decline inGive & Go added incremental net revenues of $122$106 million forand the first nine months of 2017. Unfavorable currency impacts reflected the strength of the U.S. dollar against several currencies in the region, including the British pound sterling, Turkish lira and euro, partially offset by the strength of several other currencies relative the U.S. dollar, primarily the Russian ruble. Lower net pricing was reflected across all categories except refreshment beverages and candy. Favorable volume/mix was driven by chocolate and biscuits, partially offset by declines in gum, cheese & grocery, refreshment beverages and candy. In addition, a portion of the shipments delayed at the end of the second quarter due to the malware incident was not recovered. The November 2016January 4, 2021 acquisition of a business and license to manufacture, market and sell Cadbury-branded biscuitsHu Master Holdings added incremental net revenues of $50$8 million (constant currency basis).Segment operating income increased $234 million (25.3%), primarily due to lower manufacturing costs, lower costs incurred forin the 2014-2018 Restructuring Program, lower divestiture-related costs, lower other selling, general and administrative expenses, favorable volume/mix, the benefit from the settlementfirst quarter of a Cadbury tax matter, lower advertising and consumer promotion costs and lower intangible asset impairment charges. These favorable items were partially offset by higher raw material costs, lower net pricing, unfavorable currency, the impact of divestitures, incremental costs incurred due to the malware incident and a prior-year gain on the sale of an intangible asset.North America For the Three Months Ended September 30, 2017 2016 $ change % change (in millions) $ 1,775 $ 1,753 $ 22 1.3% 318 274 44 16.1% For the Nine Months Ended September 30, 2017 2016 $ change % change (in millions) $ 4,996 $ 5,148 $ (152 ) (3.0 )% 824 840 (16 ) (1.9 )% Three Months Ended September 30:Net revenues increased $22 million (1.3%), due to favorable volume/mix (0.7 pp), favorable currency (0.5 pp) and higher net pricing (0.3 pp), partially offset by the impact of divestitures (0.2 pp). Favorable volume/mix, despite a negative impact from the second quarter malware incident, was driven by gains in biscuits, chocolate and candy, partially offset by a decline in gum.2021. Favorable currency impact was due to the strength of the Canadian dollar relative to the U.S. dollar. Higher net pricing was reflected in candydriven by biscuits and gum,chocolate, partially offset by lower net pricing in biscuitscandy and chocolate.increased $44decreased $111 million (16.1%(29.1%), primarily due to lowerhigher Simplify to Grow Program costs, incurred for the 2014-2018 Restructuring Program, lower other selling, general and administrative expenses (net of the prior year’s gain on sale of property), lower raw material costs and higher net pricing. These favorable items were partially offset by incremental costs incurred due to the malware incident,unfavorable volume/mix, higher advertising and consumer promotion costs higher manufacturing costs, prior-year gain on the sale of an intangible asset and unfavorable volume/mix.Nine Months Ended September 30:Net revenues decreased $152 million (3.0%), due to unfavorable volume/mix (2.5 pp), lower net pricing (0.5 pp) and the impact of divestitures (0.1 pp), partially offset by favorable currency (0.1 pp). Unfavorable volume/mix, primarily caused by shipments delayed at the end of the second quarter due to the malware incident that were not recovered, was driven by declines in gum, biscuits and candy, partially offset by a gain in chocolate. Lower net pricing was reflected in biscuits and chocolate, partially offset by higher net pricing in candy and gum. Favorable currency impact was due to the strength of the Canadian dollar relative to the U.S. dollar.Segment operating income decreased $16 million (1.9%), primarily due to unfavorable volume/mix, incremental costs incurred due to the malware incident, higher intangible asset impairment charges, lower net pricing, higher raw material costs and prior-year gain on the sale of an intangible asset.costs. These unfavorable items were partially offset by lower costs incurred for the 2014-2018 Restructuring Program, lower manufacturing costs, lower advertising and consumer promotion costs and lower other selling, general and administrative expenses, lower manufacturing costs (net of incremental COVID-19 related costs), higher net pricing and the prior year’s gains on salesimpact of property).futurepayments of our contractual, tax and benefit plan obligations and payments for acquisitions, share repurchases and paymentquarterly dividends. In light of the ongoing uncertainty related to the COVID-19 outbreak, however, an economic or credit crisis could occur and impair credit availability and our ability to raise capital when needed. A disruption in the financial markets could also impair our banking and other business partners, on whom we rely for access to capital and as counterparties for a number of our anticipated quarterly dividends.derivative contracts. Any of these and other developments could materially harm our access to capital or financial condition. We carry $7.0 billion of undrawn credit facilities, continue to utilize our commercial paper program and international credit lines, and we secured and continue to evaluate long-term debt issuances for regularto meet our short- and longer-term funding requirements. We also use intercompany loans with our international subsidiaries to improve financial flexibility. Earnings outsideIn connection with various legislatively authorized tax payment deferral mechanisms available for income tax, indirect tax (such as value-added tax) and payroll tax in a number of jurisdictions, we were able to defer certain of these tax payments in 2020, which provided a cash benefit that reverses when the U.S. are considered indefinitely reinvestedcash tax payments become due. Some of these payments were already made by the first quarter of 2021; the remainder will come due in 2021 and no2022. The benefits associated with the deferral of these tax payments were not material tax liability has been accrued as of September 30, 2017.to our financial statements. Overall, at this time, we do not expect any negative effects to our funding sources that would have a material effect on our liquidity; however, if a serious economic or credit market crisis were to occur, it could have a material adverse effect on our liquidity, including the indefinite reinvestmentresults of our earnings outside of the U.S.$797$915 million in the first ninethree months of 20172021 and $1,138$284 million in the first ninethree months of 2016.2020. The decreaseincrease in net cash provided by operating activities was due primarily to increases inhigher earnings and lower working capital including higher tax and VAT-related payments in 2017,requirements, partially offset by higher net earnings.$128$690 million in the first ninethree months of 20172021 and $521$55 million in the first ninethree months of 2016.2020. The decreaseincrease in net cash used in investing activities was due primarily relates to netcash paid to acquire a majority interest in Grenade and the remaining equity of Hu Master Holdings and lapping the prior-year cash proceeds received from divestitures of $516 million and lower capital expenditures of $721 millionour participation in the first nine months of 2017 compared to $909 million for the prior-year same period.KDP secondary offering. We continue to make capital expenditures primarily to modernize manufacturing facilities and support new product and productivity initiatives. We expect 20172021 capital expenditures to be up to $1.1approximately $1.0 billion, including capital expenditures in connection with our 2014-2018 RestructuringSimplify to Grow Program. We expect to continue to fund these expenditures with cash from operations.inin/Provided by Financing Activities:$1,648$1,781 million in the first ninethree months of 2017 and $8302021, compared to net cash provided by financing activities of $455 million in the first ninethree months of 2016.2020. The increase in net cash used in financing activities was primarily due to lower netthe debt issuances and increasedredeemed in the first quarter of 2021, higher share repurchases and dividends.7,8, Debt and Borrowing Arrangements, for details of our debt activity during the first ninethree months of 2017.2021. The nature and amount of our long-term and short-term debt and the proportionate amount of each varies as a result of current and expected business requirements, market conditions and other factors. Due to seasonality, in the first and second quarters of the year, our working capital requirements grow, increasing the need for short-term financing. The second half of the year typically generates higher cash flows. As such, we may issue commercial paper or secure other forms of financing throughout the year to meet short-term working capital needs.During 2016, oneissued debt totaling $4.5 billion.has outstanding debt. The operations held by MIHN generated approximately 74.2%75.0% (or $14.0$5.4 billion) of the $18.9$7.2 billion of consolidated net revenue in the ninethree months ended September 30, 2017.March 31, 2021. The operations held by MIHN represented approximately 72.8%79.0% (or $19.0$21.4 billion) of the $26.1$27.1 billion of net assets as of September 30, 2017March 31, 2021 and 81.7%76.2% (or $20.6$21.1 billion) of the $25.2$27.7 billion of net assets as of December 31, 2016.On February 3, 2017,2020.$5$6.0 billion long-term financing authority to replace the prior $8.0 billion authority. As of September 30, 2017,March 31, 2021, we had $4.7$3.6 billion of long-term financing authority remaining.$1.2to repay approximately $1.8 billion of maturing long-term debt will mature as follows:fr.250 million Swiss franc notes ($258 million as of September 30, 2017)debt: $1.5 billion in January 2018, $478 millionOctober 2021 and $0.3 billion in February 2018, £76 million sterling notes ($102 million as of September 30, 2017) in July 2018, and $322 million in August 2018.December 2021. We expect to fund these repayments with a combination of cash from operationson hand, as well as short-term and the issuance of commercial paper or long-term debt.$18.6$19.5 billion at September 30, 2017March 31, 2021 and $17.2$20.0 billion at December 31, 2016.2020. Our debt-to-capitalization ratio was 0.42 at September 30, 2017March 31, 2021 and 0.410.42 at December 31, 2016.2020. At September 30, 2017,March 31, 2021, the weighted-average term of our outstanding long-term debt was 6.58.9 years. Our average daily commercial paper borrowings outstanding were $4.4$0.2 billion in the first ninethree months of 20172021 and $2.1$3.7 billion in the first ninethree months of 2016.2020. We had commercial paper outstanding totaling $4.4$0.6 billion as of September 30, 2017March 31, 2021 and $2.4 billion as ofno commercial paper borrowings outstanding at December 31, 2016.2020. We expect to continue to use cash or commercial paper to finance various short-term financing needs. We continue to comply with our debt covenants. Refer to Note 7,8, Debt and Borrowing Arrangements, for more information on our debt and debt covenants..ninethree months of 2017,2021, the primary drivers of the increase in our aggregate commodity costs were higher currency-relatedcurrency exchange transaction costs on our commodity purchases andimported materials, as well as increased costs for dairy, cocoa, sugar, oils, packaging, and grains, & oils, energynuts and other raw materials,ingredients costs, partially offset by lower costs for nuts. slightly higher aggregate cost environment to continue in 2017.the remainder of 2021. While the costs of our principal raw materials fluctuate, we believe there will continue to be an adequate supply of the raw materials we use and that they will generally remain available from numerous sources.7,8, Debt and Borrowing Arrangements, for information on debt transactions during the first nine months of 2017.2021. There were no other material developments or changes to our off-balance sheet arrangements and aggregate contractual obligations disclosed in our Annual Report on Form 10-K for the year ended December 31, 2016. We also do not expect a material change in the effect of these arrangements and obligations on our liquidity. See Note 11,Commitments and Contingencies, for a discussion of guarantees.10,11, Stock Plans, to our condensed consolidated financial statements and Part II, Item 2, Unregistered Sales of Equity and Use of Proceeds, for more information on our stock plans, grant activity and share repurchase program for the ninethree months ended September 30, 2017.We intend to continue to use a portionMarch 31, 2021.our cash for share repurchases. On July 29, 2015, our Finance Committee, with authorization delegated fromMarch 31, 2021, our Board of Directors approved an increasehas authorized share repurchases up to $23.7 billion through December 31, 2023. Under this program, we have repurchased approximately $19.0 billion of $6.0shares through March 31, 2021 ($1.0 billion in the share repurchase program, raising the authorization to $13.7first three months of 2021, $1.4 billion of Common Stock repurchases,in 2020, $1.5 billion in 2019, $2.0 billion in 2018, $2.2 billion in 2017, $2.6 billion in 2016, $3.6 billion in 2015, $1.9 billion in 2014 and extended the program through December 31, 2018.We repurchased shares$2.7 billion in 2013), at an aggregate cost of $12,673 million, ora weighted-average cost of $38.74$41.18 per share, through September 30, 2017 ($1,817 million in the first nine months of 2017, $2,601 million in 2016, $3,623 million in 2015, $1,892 million in 2014 and $2,740 in 2013). share.boardBoard and management discretion. Additionally, our share repurchase activity during any particular period may fluctuate. We may accelerate, suspend, delay or discontinue our share repurchase program at any time, without notice.$869$453 million in the first ninethree months of 20172021 and $801$409 million in the first ninethree months of 2016. On August 2, 2017, the Finance Committee, with authorization delegated from our Board2020. The first quarter 2021 dividend of Directors, approved a 16% increase in the quarterly dividend to $0.22$0.315 per common share, or $0.88 per common sharedeclared on an annualized basis.February 4, 2021 for shareholders of record as of March 31, 2021, was paid on April 14, 2021. The declaration of dividends is subject to the discretion of our Board of Directors and depends on various factors, including our net earnings, financial condition, cash requirements, future prospects and other factors that our Board of Directors deems relevant to its analysis and decision making.make a determination as to whether 2017 distributions arebe characterized as dividends a return of basis, or both under U.S. federal income tax rules after the 2017 calendar year-end. Thisrules. The final determination will be reflectedmade on an IRS Form 1099-DIV1099–DIV issued in early 2018.2016.2020. Our significant accounting estimates are described inManagement’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2016.2020. See Note 1,Basis of Presentation, for a discussion of the impact of new accounting standards. Furthermore, see Note 5,Goodwill and Intangible Assets, for a discussion on the significant accounting estimates considered as part of the annual goodwill and intangibles asset impairment testing. There were no changes in our accounting policies in the current period that had a material impact on our financial statements.11,12, Commitments and Contingencies, and Part II, Item 1.Legal Proceedings, for a discussion of contingencies.“deliver,“objective,” “predict,” “project,” “seek,” “aim,” “predict,” “potential,” “objective,” “project,” “outlook” and similar expressions are intended to identify our forward-looking statements, including but not limited to statements about: the impact of the COVID-19 pandemic on our business including consumer demand, costs, product mix, the availability of our products, our strategic initiatives, our and our partners’ global supply chains, operations, technology, assets and routes to market, and our financial performance; our future performance, including our future revenue growth, margins and earnings per share;growth; our strategy to accelerate consumer-centric growth, drive operational excellence and create a winning growth culture; volatility in global consumer, commodity, currency and capital markets; price volatility and pricing actions; the cost environment and measures to address increased costs; our ability to meet demand for our products; our tax rate, tax positions, tax proceedings and the United Kingdom’s planned exitimpact of U.S. and Swiss tax reform on our results; the U.K.'s separation from the European UnionE.U. and its impact on our results;business and results, including in connection with disagreements on trade terms, delays affecting our supply chain or distribution, or disruptions to sales or collections; the costs of, timing of expenditures under and completion of our restructuring program; category growth; consumer snacking behaviors; commodity prices and supply; investments;our investments including in JDE Peet's and KDP; innovation; political, business and economic conditions and volatility; currency exchange rates, controls and restrictions; potential impacts from changing torestrictions, volatility in foreign currencies and the effect of currency translation on our results of operations; the application of highly inflationary accounting for our Argentinean subsidiaries and the potential for and impacts from currency devaluation in selectedother countries; our operations in Ukraine; overhead costs; our JDE ownership interest;the outcome and effects on us of legal matters;proceedings and government investigations; the estimated value of goodwill and intangible assets; amortization expense for intangible assets; impairment of goodwill and intangible assets and our projections of operating results and other factors that may affect our impairment testing; our accounting estimates and judgments and the impact of new accounting pronouncements; pension expenses, contributions and assumptions; our tax rate and tax positions; the Brazilian indirect tax matter; remediation efforts related to and the financial and other impacts of the malware incident; our liquidity, funding sources and uses ofreinvestmentour capital structure and liquidity, credit availability and our ability to raise capital, and the impact of earnings;market disruptions on us, our counterparties and our business partners; the planned phase out of London Interbank Offered Rates; our risk management program, including the use of financial instruments and the impacts and effectiveness of our hedging activities; working capital; capital expenditures and funding; funding of debt maturities; share repurchases; dividends; long-term value and return on investment for our shareholders; the characterization of 2021 distributions as dividends; compliance with our debt covenants; and our contractual and other obligations.control.control, and many of these risks and uncertainties are currently amplified by and may continue to be amplified by the COVID-19 pandemic. Important factors that could cause our actual results to differ materially from those described in our forward-looking statements include, but are not limited to, uncertainty about the magnitude, duration, geographic reach, impact on the global economy and related current and potential travel restrictions of the COVID-19 pandemic; the current, and uncertain future, impact of the COVID-19 pandemic on our business, growth, reputation, prospects, financial condition, operating results (including components of our financial results), cash flows and liquidity; risks from operating globally including in emerging markets; changes in currency exchange rates, controls and restrictions; continued volatility of commodity and other input costs; weakness in economic conditions; weakness in consumer spending; pricing actions; tax matters including changes in tax laws and rates, disagreements with taxing authorities and imposition of new taxes; use of information technology and third party service providers; unanticipated disruptions to our business, such as the malware incident, cyberattacks or other security breaches; global or regional health pandemics or epidemics, including COVID-19; competition; acquisitionsprotection of our reputation and divestitures;brand image; changes in consumer preferences and demand and our ability to innovate and differentiate our products; the restructuring program and our other transformation initiatives not yielding the anticipated benefits; changes in the assumptions on which the restructuring program is based; protection of our reputation and brand image; management of our workforce; consolidation of retail customers and competition with retailer and other economy brands; changes in our relationships with customers, suppliers or customers;distributors; legal, regulatory, tax or benefit law changes, claims or actions; the impact of climate change on our supply chain and operations; strategic transactions; our ability to innovate and differentiate our products; significant changes in valuation factors that may adversely affect our impairment testing of goodwill and intangible assets; perceived or actual product quality issues or product recalls; failure to maintain effective internal control over financial reporting; volatility of and access to capital or other markets;markets and our liquidity; pension costs; usethe expected discontinuance of information technologyLondon Interbank Offered Rates and third party service providers;transition to any other interest rate benchmark; and our ability to protect our intellectual property and intangible assets; a shift in our pre-tax income among jurisdictions, including the United States; and tax law changes.assets. We disclaim and do not undertake any obligation to update or revise any forward-looking statement in this report except as required by applicable law or regulation.•“Organic Net Revenue” is defined as net revenues excluding the impacts of acquisitions, divestitures(2), our historical global coffee business(3), our historical Venezuelan operations, accounting calendar changes and currency rate fluctuations(4). We also evaluate Organic Net Revenue growth from emerging markets and our Power Brands.Belarus, Georgia, Poland, Czech Republic, Slovak Republic, Hungary, Bulgaria, Romania, the Baltics and the East Adriatic countries. (Our•Our Power Brands include some of our largest global and regional brands such asOreo, Chips Ahoy!, Ritz, TUC/Club Social andbelVita biscuits;Cadbury Dairy Milk, Milka andLacta chocolate;Tridentgum;Halls candy; andTang powdered beverages.•“Adjusted Operating Income” is defined as operating income excluding the impacts of the 2012-2014 Restructuring Program(5); the 2014-2018 Restructuring Program(5); Venezuela remeasurement and deconsolidation losses and historical operating results; gains or losses (including non-cash impairment charges) on goodwill and intangible assets; divestiture(2) or acquisition gains or losses and related integration and acquisition costs; the JDE coffee business transactions(3) gain and net incremental costs; the operating results of divestitures(2); our historical global coffee business operating results(3); mark-to-market impacts from commodity and forecasted currency transaction derivative contracts(6); equity method investment earnings historically reported within operating income(7); benefits from resolution of tax matters(8) and incremental expenses related to the malware incident. We also present “Adjusted Operating Income margin,” which is subject to the same adjustments as Adjusted Operating Income. We also evaluate growth in our Adjusted Operating Income on a constant currency basis(4).•“Adjusted EPS” is defined as diluted EPS attributable to Mondelēz International from continuing operations excluding the impacts of the 2012-2014 Restructuring Program(5); the 2014-2018 Restructuring Program(5); Venezuela remeasurement and deconsolidation losses and historical operating results; losses on debt extinguishment and related expenses; gains or losses (including non-cash impairment charges) on goodwill and intangible assets; divestiture(2) or acquisition gains or losses and related integration and acquisition costs; the JDE coffee business transactions(3) gain, transaction hedging gains or losses and net incremental costs; gain on the equity method investment exchange; net earnings from divestitures(2); mark-to-market impacts from commodity and forecasted currency transaction derivative contracts(6); gains or losses on interest rate swaps no longer designated as accounting cash flow hedges due to changed financing and hedging plans; benefits from resolution of tax matters(8) and incremental expenses related to the malware incident. Similarly, within Adjusted EPS, our equity method investment net earnings exclude our proportionate share of our investees’ unusual or infrequent items(9), such as acquisition and divestiture-related costs and restructuring program costs. We also evaluate growth in our Adjusted EPS on a constant currency basis(4).(1)When items no longer impact our current or future presentation of non-GAAP operating results, we remove these items from our non-GAAP definitions. During 2017, we added to the non-GAAP definitions the exclusion of benefits from the resolution of tax matters (see footnote (8) below) and the exclusion of incremental expenses related to the malware incident.(2)Divestitures include completed sales of businesses and exits of major product lines upon completion of a sale or licensing agreement. On August 17, 2017, we entered into two agreements with The Kraft Heinz Company (“KHC”) to terminate the licenses of certain KHC-owned brands used in our grocery business within our Europe region and to transfer to KHC inventory and certain other assets. During the third and fourth quarter, the first and second transactions closed. Also, on October 2, 2017, we completed the sale of one of our equity method investments. See Note 2,Divestitures and Acquisitions, for additional information. As the transactions were substantially completed as of September 30, 2017, we removed the historical results related to these transactions from our Organic Net Revenue and adjusted results for all periods presented.(3)We continue to have an ongoing interest in the legacy coffee business we deconsolidated in 2015 as part of the JDE coffee business transactions. For historical periods prior to the July 15, 2015 coffee business deconsolidation, we have reclassified any net revenue or operating income from the historical coffee business and include them where the coffee equity method investment earnings are presented within Adjusted EPS. As such, Organic Net Revenue and Adjusted Operating Income in all periods do not include the results of our legacy coffee businesses, which are shown within Adjusted EPS only.(4)Constant currency operating results are calculated by dividing or multiplying, as appropriate, the current-period local currency operating results by the currency exchange rates used to translate the financial statements in the comparable prior-year period to determine what the current-period U.S. dollar operating results would have been if the currency exchange rate had not changed from the comparable prior-year period.(5)Non-GAAP adjustments related to the 2014-2018 Restructuring Program reflect costs incurred that relate to the objectives of our program to transform our supply chain network and organizational structure. Costs that do not meet the program objectives are not reflected in the non-GAAP adjustments. Refer to our Annual Report on Form 10-K for the year ended December 31, 2016 for more information on the 2012-2014 Restructuring Program.(6)During the third quarter of 2016, we began to exclude unrealized gains and losses (mark-to-market impacts) from outstanding commodity and forecasted currency transaction derivatives from our non-GAAP earnings measures until such time that the related exposures impact our operating results. Since we purchase commodity and forecasted currency transaction contracts to mitigate price volatility primarily for inventory requirements in future periods, we made this adjustment to remove the volatility of these future inventory purchases on current operating results to facilitate comparisons of our underlying operating performance across periods. We also discontinued designating commodity and forecasted currency transaction derivatives for hedge accounting treatment. To facilitate comparisons of our underlying operating results, we have recast all historical non-GAAP earnings measures to exclude the mark-to-market impacts.(7)Historically, we have recorded income from equity method investments within our operating income as these investments operated as extensions of our base business. Beginning in the third quarter of 2015, we began to record the earnings from our equity method investments in after-tax equity method investment earnings outside of operating income following the deconsolidation of our coffee business. Refer to Note 1,Summary of Significant Accounting Policies,in our Annual Report on Form 10-K for the year ended December 31, 2016 for more information.(8)During the first nine months of 2017, we recorded benefits from the settlement of a pre-acquisition Cadbury tax matter and from the reversal of tax liabilities in connection with the resolution of a Brazilian indirect tax matter. See Note 11,Commitments and Contingencies – Tax Matters.(9)We have excluded our proportionate share of our equity method investees’ unusual or infrequent items in order to provide investors with a comparable view of our performance across periods. Although we have shareholder rights and board representation commensurate with our ownership interests in our equity method investees and review the underlying operating results and unusual or infrequent items with them each reporting period, we do not have direct control over their operations or resulting revenue and expenses. Our use of equity method investment net earnings on an adjusted basis is not intended to imply that we have any such control. Our GAAP “diluted EPS attributable to Mondelēz International from continuing operations” includes all of the investees’ unusual and infrequent items.Revenue”,Revenue,” the adjustments made to “net revenues” (the most comparable U.S. GAAP financial measure) were to exclude the impact of currency an acquisition and divestitures.acquisitions. We believe that Organic Net Revenue reflects the underlying growth from the ongoing activities of our business and provides improved comparability of results. We also evaluate our Organic Net Revenue growth from emerging markets and Power Brands,developed markets, and these underlying measures are also reconciled to U.S. GAAP below. For the Three Months Ended September 30, 2017 For the Three Months Ended September 30, 2016 (1) Emerging Developed Emerging Developed Markets Markets Total Markets Markets Total (in millions) (in millions) $ 2,445 $ 4,085 $ 6,530 $ 2,340 $ 4,056 $ 6,396 4 (84 ) (80 ) – – – – (20 ) (20 ) – – – – (14 ) (14 ) (4 ) (152 ) (156 ) $ 2,449 $ 3,967 $ 6,416 $ 2,336 $ 3,904 $ 6,240 For the Three Months Ended September 30, 2017 For the Three Months Ended September 30, 2016 (2) Power Non-Power Power Non-Power Brands Brands Total Brands Brands Total (in millions) (in millions) $ 4,771 $ 1,759 $ 6,530 $ 4,517 $ 1,879 $ 6,396 (62 ) (18 ) (80 ) – – – (20 ) – (20 ) – – – – (14 ) (14 ) – (156 ) (156 ) $ 4,689 $ 1,727 $ 6,416 $ 4,517 $ 1,723 $ 6,240 For the Nine Months Ended September 30, 2017 For the Nine Months Ended September 30, 2016 (1) Emerging Developed Emerging Developed Markets Markets Total Markets Markets Total (in millions) (in millions) $ 7,151 $ 11,779 $ 18,930 $ 6,982 $ 12,171 $ 19,153 12 123 135 – – – – (50 ) (50 ) – – – – (249 ) (249 ) (8 ) (434 ) (442 ) $ 7,163 $ 11,603 $ 18,766 $ 6,974 $ 11,737 $ 18,711 For the Nine Months Ended September 30, 2017 For the Nine Months Ended September 30, 2016 (2) Power Non-Power Power Non-Power Brands Brands Total Brands Brands Total (in millions) (in millions) $ 13,784 $ 5,146 $ 18,930 $ 13,587 $ 5,566 $ 19,153 63 72 135 – – – (50 ) – (50 ) – – – – (249 ) (249 ) – (442 ) (442 ) $ 13,797 $ 4,969 $ 18,766 $ 13,587 $ 5,124 $ 18,711 (1)As a result of the October 1, 2016 segment change described in Note 15,Segment Reporting, prior-year amounts were updated to reflect the new segment structure.(2)Each year we reevaluate our Power Brands and confirm the brands in which we will continue to make disproportionate investments. As such, we may make changes in our planned investments in primarily regional Power Brands following our annual review cycles. For 2017, we made limited changes to our list of regional Power Brands and as such, we reclassified 2016 Power Brand net revenues on a basis consistent with the current list of Power Brands. For the Three Months Ended March 31, 2021 For the Three Months Ended March 31, 2020 Emerging
MarketsDeveloped
MarketsTotal Emerging
MarketsDeveloped
MarketsTotal (in millions) (in millions) Net Revenue $ 2,563 $ 4,675 $ 7,238 $ 2,417 $ 4,290 $ 6,707 Impact of currency 94 (254) (160) — — — Impact of acquisition — (114) (114) — — — Organic Net Revenue $ 2,657 $ 4,307 $ 6,964 $ 2,417 $ 4,290 $ 6,707 Income”,Income,” the adjustments made to “operating income” (the most comparable U.S. GAAP financial measure) were to exclude 2014-2018 Restructuring Program costs; impairment charges relatedSimplify to intangible assets;Grow Program; mark-to-market impacts from commodity and forecasted currency transaction derivative contracts; incremental expenses related to the malware incident; acquisition integration costs; divestiture-relatedacquisition-related costs; the operating results of divestitures; net gain on divestitures; gain on salean acquisition; the remeasurement of intangible assetsnet monetary position; and the benefitsimpact from the resolution of tax matters.pension participation changes. We also present “Adjusted Operating Income margin,” which is subject to the same adjustments as Adjusted Operating Income, and evaluate Adjusted Operating Income on a constant currency basis. We believe these measures provide improved comparability of underlying operating results. For the Three Months Ended
September 30, 2017 2016 $ Change % Change (in millions) $ 1,181 $ 702 $ 479 68.2% 175 301 (126 ) 71 4 67 (28 ) 12 (40 ) 47 – 47 1 – 1 (4 ) (37 ) 33 (187 ) – (187 ) – (7 ) 7 (155 ) – (155 ) (1 ) (1 ) – $ 1,100 $ 974 $ 126 12.9% (20 ) – (20 ) $ 1,080 $ 974 $ 106 10.9% For the Nine Months Ended
September 30, 2017 2016 $ Change % Change (in millions) $ 2,662 $ 2,062 $ 600 29.1% 597 766 (169 ) 109 30 79 69 49 20 54 – 54 2 6 (4 ) 23 84 (61 ) (55 ) (99 ) 44 (184 ) – (184 ) – (13 ) 13 (201 ) – (201 ) (1 ) (2 ) 1 $ 3,075 $ 2,883 $ 192 6.7% 53 – 53 $ 3,128 $ 2,883 $ 245 8.5% (1)Refer to Note 6,2014-2018 Restructuring Program,for more information.(2)Refer to Note 2,Divestitures and Acquisitions, and Note 5,Goodwill and Intangible Assets, for more information on trademark impairments.(3)Refer to Note 8,Financial Instruments, Note 15,Segment Reporting, andNon-GAAP Financial Measures appearing earlier in this section for more information on these unrealized losses/gains on commodity and forecasted currency transaction derivatives.(4)Refer to our Annual Report on Form 10-K for the year ended December 31, 2016, for information on the acquisition of a biscuit business in Vietnam.(5)Refer to Note 2,Divestitures and Acquisitions, for more information on the 2017 sales of a confectionery business in France, a grocery business in Australia and New Zealand, and certain licenses of KHC-owned brands used in our grocery business within our Europe region. Refer to our Annual Report on Form 10-K for the year ended December 31, 2016 for more information on the 2016 sale of a confectionery business in Costa Rica.(6)Refer to Note 2,Divestitures and Acquisitions, for more information on the 2016 intangible asset sale in Finland.(7)Refer to Note 11,Commitments and Contingencies – Tax Matters, for more information on the settlement of a pre-acquisition Cadbury tax matter and the reversal of tax liabilities in connection with the resolution of a Brazilian indirect tax matter. For the Three Months Ended
March 31, 2021 2020 $ Change % Change (in millions) Operating Income $ 1,283 $ 856 $ 427 49.9 % 122 58 64 (118) 185 (303) 1 — 1 7 5 2 (9) — (9) 5 2 3 Impact from pension participation changes 1 — 1 Adjusted Operating Income $ 1,292 $ 1,106 $ 186 16.8 % Favorable currency translation (44) — (44) Adjusted Operating Income (constant currency) $ 1,248 $ 1,106 $ 142 12.8 % EPS”EPS,” (1), the adjustments made to “diluted EPS attributable to Mondelēz International” (the most comparable U.S. GAAP financial measure) were to exclude 2014-2018 Restructuring Program costs; impairment charges related to intangible assets; mark-to-marketthe impacts from commodity and forecasted currency transaction derivative contracts; incremental expenses related toof the malware incident; acquisition integration costs; divestiture-related costs;items listed in the Adjusted Operating Income tables above as well as net earnings from divestitures; net gain on divestitures; the benefits from the resolution of tax matters;a loss onrelated to interest rate swaps; a loss on debt extinguishment;extinguishment and related expenses; gain on the equity method investment exchangetransactions; and our proportionate share of unusual or infrequentsignificant operating and non-operating items recorded by our JDE Peet's and KeurigKDP equity method investees. We also evaluate Adjusted EPS on a constant currency basis. We believe Adjusted EPS provides improved comparability of underlying operating results. For the Three Months Ended
September 30, 2017 2016 $ Change % Change $ 0.65 $ 0.35 $ 0.30 85.7% 0.08 0.14 (0.06 ) 0.04 – 0.04 (0.02 ) – (0.02 ) 0.02 – 0.02 0.01 – 0.01 – (0.02 ) 0.02 (0.12 ) – (0.12 ) (0.09 ) – (0.09 ) – 0.03 (0.03 ) $ 0.57 $ 0.50 $ 0.07 14.0% (0.01 ) – (0.01 ) $ 0.56 $ 0.50 $ 0.06 12.0% For the Nine Months Ended
September 30, 2017 2016 $ Change % Change $ 1.38 $ 0.99 $ 0.39 39.4% 0.29 0.36 (0.07 ) 0.05 0.01 0.04 0.04 0.03 0.01 0.02 – 0.02 0.02 0.04 (0.02 ) (0.03 ) (0.05 ) 0.02 (0.11 ) – (0.11 ) – – – (0.13 ) – (0.13 ) – 0.04 (0.04 ) 0.01 – 0.01 – (0.03 ) 0.03 0.03 0.03 – $ 1.57 $ 1.42 $ 0.15 10.6% 0.02 – 0.02 $ 1.59 $ 1.42 $ 0.17 12.0% (1)The tax expense/(benefit) of each of the pre-tax items excluded from our GAAP results was computed based on the facts and tax assumptions associated with each item, and such impacts have also been excluded from Adjusted EPS. For the Three Months Ended
March 31, 2021 2020 $ Change % Change Diluted EPS attributable to Mondelēz International $ 0.68 $ 0.51 $ 0.17 33.3 % 0.07 0.03 0.04 (0.07) 0.11 (0.18) 0.01 — 0.01 — (0.01) 0.01 — 0.06 (0.06) 0.07 — 0.07 — (0.04) 0.04 0.01 — 0.01 Adjusted EPS $ 0.77 $ 0.66 $ 0.11 16.7 % Favorable currency translation (0.04) — (0.04) Adjusted EPS (constant currency) $ 0.73 $ 0.66 $ 0.07 10.6 % September 30, 2017,March 31, 2021, taxes onfor the: 2014-2018 RestructuringSimplify to Grow Program costs were $(49) million, intangible asset impairment charges were $(16)$(31) million, mark-to-market gains from derivatives were $3$22 million, malware incident incremental expensesacquisition-related costs were $(15)$(1) million, loss on debt extinguishment were $(34) million and equity method investee items were $(1) million.$(1) million, divestiture-related costs were $18 million, net gain on divestitures were $8 million, benefits from resolution of tax matters were $72 million and equity method investee adjustments were $(2) million.For the three months ended September 30, 2016, taxes on the: 2014-2018 Restructuring Program costs were $(82) million, mark-to-market losses from derivatives were $(4) million, net earnings from divestitures were $11 million, and equity method investee adjustments were $(4) million.For the nine months ended September 30, 2017, taxes on the: 2014-2018 Restructuring Program costs were $(155) million, intangible asset impairment charges were $(30) million, malware incident incremental expenses were $(17) million, net earnings from divestitures were $13 million, divestiture-related costs were $13 million, net gain on divestitures were $12 million, benefits from resolution of tax matters were $72 million, loss on debt extinguishment were $(4) million, and equity method investee adjustments were $(8) million.For the nine months ended September 30, 2016, taxes for the: 2014-2018 Restructuring Program costs were $(199) million, intangible asset impairment charges were $(8) million, mark-to-market losses from derivatives were $(6) million, divestiture-related costs were $(20) million, net earnings from divestitures were $26$5 million, loss related to interest rate swaps were $(35)$(24) million and gain on equity method investment exchangetransactions were $2 million$17 million.investee adjustments were $(5) million.investments in KDP and JDE Peet’s as if the sales occurred at the beginning of all periods presented.(2)See theAdjusted Operating Income table above and the related footnotes for more information.(3)Includes our proportionate share of unusual or infrequent items, such as acquisition and divestiture-related costs and restructuring program costs, recorded by our JDE and Keurig equity method investees.(4)Refer to Note 8,Financial Instruments, for more information on our interest rate swaps, which we no longer designate as cash flow hedges during the first quarter of 2016 due to changes in financing and hedging plans.(5)Refer to Note 7, Debt and Borrowing Arrangements, for more information on our loss on debt extinguishment and related expenses in connection with our debt discharge.(6)Refer to Note 2,Divestitures and Acquisitions – Keurig Transaction, for more information on the 2016 acquisition of an interest in Keurig.8,9, Financial Instruments.ninethree months ended September 30, 2017.March 31, 2021. Throughout our discussion and analysis of results, we isolate currency impacts and supplementally provide net revenues, operating income and diluted earnings per share on a constant currency basis. For additional information on highly inflationary country currencies and the impact of currency policies, and recent currency volatilitydevaluations and highly inflationary accounting on our financial condition and results of operations, also see Note 1,Basis of Presentation – Currency Translation and Highly Inflationary Accounting.conditions.conditions such as the current COVID-19 global pandemic. To manage input cost volatility, we enter into forward purchase agreements and other derivative financial instruments. We also pursue productivity and cost saving measures and take pricing actions when necessary to mitigate the impact of higher input costs on earnings., Euro Interbank Offered Rate (“EURIBOR”). The Financial Conduct Authority in the United Kingdom plans to initiate the phase-out of many term LIBOR rates by the end of 2021 and commercial paper rates.to phase out the remaining LIBOR rates by June 30, 2023.. We do not anticipate a significant impact to our financial position from the planned phase out of LIBOR given our current mix of variable and fixed-rate debt. We periodically use interest rate swaps and forward interest rate contracts to achieve a desired proportion of variable versus fixed rate debt based on current and projected market conditions. Our weighted-average interest rate on total debt was 2.0% as of September 30, 2017 and 2.2% as of December 31, 2016. For more information on our 20172021 debt activity, see Note 7,8, Debt and Borrowing Arrangements.There were no significant changes in the types8,9, Financial Instruments, for more information on our 20172021 derivative activity. For additional information on our hedging strategies, policies and practices on an ongoing basis, also refer to our Annual Report on Form 10-K for the year ended December 31, 2016.2020.September 30, 2017.March 31, 2021. Based on this evaluation, the CEO and CFO concluded that our disclosure controls and procedures were effective as of September 30, 2017.September 30, 2017. During the quarter, dueMarch 31, 2021. Many of our employees and those of our outsourcing partners and other accounting service providers continued to work remotely as a significant number of our and their offices were closed in response to the malware incident,COVID-19 outbreak. There were no material changes in our internal controls over financial reporting as we supplemented or temporarily replaced some of our normal control procedures in orderwere able to continue to maintain our existing ITcontrols and financial controlsprocedures over financial reporting. Additionally, we continued to work with outsourced partners to further simplify and standardize processes and focus on scalable, transactional processes across all regions. We continued to transition some of our transactional data processing as well as financial and local tax reporting for a number of countries across all regions to three outsourced partners. Pursuant to our service agreements, the controls previously established around these accounting functions will be maintained by our outsourced partners or by us, and they are subject to management’s internal control testing. There were no other changes in our internal control over financial reporting during the quarter ended September 30, 2017, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.11,12, Commitments and Contingencies, to the condensed consolidated financial statements in this report.2016.2020.September 30, 2017March 31, 2021 was: Issuer Purchases of Equity Securities Total Number of Total Shares Purchased Approximate Dollar Value Number Average as Part of Publicly of Shares That May Yet of Shares Price Paid Announced Plans Be Purchased Under the Purchased(1) per Share (1) or Programs(2) Plans or Programs(2) 3,475,099 $ 43.22 3,471,070 $ 1,585,235,871 8,577,563 42.78 8,569,093 1,218,677,932 4,685,783 40.62 4,677,115 1,028,685,599 16,738,445 42.27 16,717,278 (1)The total number of shares purchased (and the average price paid per share) reflects: (i) shares purchased pursuant to the repurchase program described in (2) below; and (ii) shares tendered to us by employees who used shares to exercise options and to pay the related taxes for grants of restricted and deferred stock that vested, totaling 4,029 shares, 8,470 shares and 8,668 shares for the fiscal months of July, August and September 2017, respectively.(2)Our Board of Directors authorized the repurchase of $13.7 billion of our Common Stock through December 31, 2018. Specifically, on March 12, 2013, our Board of Directors authorized the repurchase of up to the lesser of 40 million shares or $1.2 billion of our Common Stock through March 12, 2016. On August 6, 2013, our Audit Committee, with authorization delegated from our Board of Directors, increased the repurchase program capacity to $6.0 billion of Common Stock repurchases and extended the expiration date to December 31, 2016. On December 3, 2013, our Board of Directors approved an increase of $1.7 billion to the program related to a new accelerated share repurchase program, which concluded in May 2014. On July 29, 2015, our Finance Committee, with authorization delegated from our Board of Directors, approved a $6.0 billion increase that raised the repurchase program capacity to $13.7 billion and extended the program through December 31, 2018. See related information in Note 10,Stock Plans. Issuer Purchases of Equity Securities Period January 1-31, 2021 7,440,146 $ 57.77 7,431,570 $ 5,325 February 1-28, 2021 7,440,952 55.79 6,750,304 4,954 March 1-31, 2021 3,980,560 57.27 3,977,129 4,734 For the Quarter Ended March 31, 2021 18,861,658 55.82 18,159,003
Number4.1 10.1OfferThe Registrant agrees to furnish to the SEC upon request copies of Employment Letter, betweenany instruments defining the rights of holders of long-term debt of the Registrant and Dirk Van de Put,its consolidated subsidiaries that does not exceed 10 percent of the total assets of the Registrant and its consolidated subsidiaries.10.1 July 27, 2017February 24, 2021, by and among the Registrant, the lenders named therein and JPMorgan Chase Bank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Registrant’sRegistrant's Current Report on Form 8-K filed with the SEC on August 2, 2017)February 24, 2021). +10.2 12.110.310.4 31.1 31.2 31.232.1 32.1101 101.1September 30, 2017March 31, 2021 are formatted in XBRL (eXtensibleiXBRL (Inline eXtensible Business Reporting Language): (i) the Condensed Consolidated Statements of Earnings, (ii) the Condensed Consolidated Statements of Comprehensive Earnings, (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Equity, (v) the Condensed Consolidated Statements of Cash Flows and (vi) Notes to Condensed Consolidated Financial Statements.104 The cover page from Mondelēz International’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2021, formatted in Inline XBRL (included as Exhibit 101). + Indicates a management contract or compensatory plan or arrangement. + Indicates a management contract or compensatory plan or arrangement.MONDELĒZ INTERNATIONAL, INC. By: /s/ LUCA ZARAMELLA By: /s/ BRIAN T. GLADDENLuca ZaramellaBrian T. GladdenExecutive Vice President and Chief Financial Officer (Duly Authorized Officer) Chief Financial OfficerOctober 31, 2017April 27, 202158