Unleashing a Global Snacking Powerhouse September 6, 2012 1 Exhibit 99.2 |
Irene Rosenfeld Chairman and CEO 2 |
Forward-looking statements 3 This slide presentation contains a number of forward-looking statements. The words “plan,” “will,” “deliver,” “drive,” “continue,” “focus,” “maintain,” and similar expressions are intended to identify our forward-looking statements. Examples of forward-looking statements include, but are not limited to, our International as an unique investment vehicle; snacks are growth categories; expectations for BRIC countries; expectations for Next Wave markets; 5-year revenue growth outlook for developing markets; our strategy to deliver top-tier performance; North America growth and margin upside; expectations for Europe; driving efficiency; Global Category Teams; global innovation platforms; selling; Priority Markets; maintaining leadership; Power Brands and Priority Markets growth; Gum category, including market share; Chocolate growth and developing markets as primary driver; our virtuous cycle; gross margin; overheads; reinvesting in growth; long-term targets; Free Cash Flow; long-term EPS; 2013 Outlook; and our expectation that efficiency will fuel growth. These forward-looking statements involve risks and uncertainties, many of which are beyond our control, and important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, our failure to successfully create two companies, continued global economic weakness, continued volatility and increase in input costs, increased competition, pricing actions, our debt and our ability to pay our debt and tax law changes. For additional information on these and other factors that could affect our forward- looking statements, see our risk factors, as they may be amended from time to time, set forth in our filings with the SEC, including our most recently filed Annual Report on Form 10-K and subsequent reports on Forms 10-Q and 8-K. We disclaim and do not undertake any obligation to update or revise any forward-looking statement in this slide presentation, except as required by applicable law or regulation. opportunity for growth as two independent companies; setting Kraft Foods on a new trajectory; Mondelez - |
Agenda Unleashing a global snacking powerhouse Leveraging our global categories – Biscuits – Gum and Candy – Chocolate Delivering top-tier financial performance 4 |
Successfully set Kraft Foods on a new trajectory Delivered strong performance Transformed portfolio and geographic footprint Successfully integrated LU and Cadbury Enhanced market positions to become #1 or #2 in all core categories Created a virtuous cycle in each geography 5 |
Daniel Myers EVP, Integrated Supply Chain Gerd Pleuhs EVP, Legal Affairs and General Counsel Mary Beth West EVP and Chief Category and Marketing Officer David Brearton EVP and Chief Financial Officer Our world-class leadership will build on these results 6 Irene Rosenfeld Chairman and Chief Executive Officer Sanjay Khosla EVP and President, Developing Markets Tim Cofer EVP and President, Europe Mark Clouse EVP and President, North America Karen May EVP, Human Resources Jean Spence EVP, Research, Development & Quality Tracey Belcourt EVP, Strategy Lorna Davis SVP, Global Category Leader Biscuits Jim Cali SVP, Global Category Leader Gum & Candy Bharat Puri SVP, Global Category Leader Chocolate |
Opportunity to accelerate growth as two independent companies 7 Kraft Foods Group, Inc. |
8 Fast- Growing Categories Advantaged Geographic Footprint Favorite Snacks Brands Strong Route-to- Market Proven Innovation Platforms World-Class Talent & Capabilities Mondelez International is a unique investment vehicle |
Snacks are growth categories Well-aligned with consumer trends Expandable consumption Developing Markets consumption supported by GDP growth Higher margins 9 |
We are a global snacks powerhouse … 10 $36 Billion in Revenues (2) • Nearly 75% of revenues in fast-growing snacks categories • Beverages provide multi- region scale, attractive growth and strong margins Biscuits (1) 30% Chocolate 27% Gum & Candy 16% Beverages 17% Cheese & Grocery 10% (1) Biscuits includes salty/other snacks (2) Based on 2011 reported net revenues; includes accounting calendar changes and 53 Week. rd |
… and a leader in our categories 11 North America Europe Latin America Asia Pacific Eastern Europe Middle East & Africa Global Developing Markets Source: Euromonitor 2011, Kraft Foods analysis Share Market Share Position Biscuits #1 #1 #1 #1 #1 #1 #1 18% Chocolate #5 #1 #2 #1 #2 #1 #1 15% Gum #2 #3 #1 #3 #2 #1 #2 30% Candy #3 #2 #2 #3 -- #1 #1 7% Coffee -- #2 -- #2 #2 #3 #2 11% Powdered -- -- #1 #1 #3 #2 #1 16% Beverages |
We offer many of the world’s favorite snacks brands 12 |
Each region plays a critical role in our strategy $36 Billion* Latin America MEA Asia Pacific Europe 37% North America 19% Developing Markets 44% CEE • Large, growing Developing Markets footprint • Strong, advantaged positions in North America and Europe • Broad-based growth across categories and geographies 13 * Based on 2011 reported net revenues; includes accounting calendar changes and 53 rd Week. |
Developing Markets: Strong geographic and category footprint 14 $16 billion (2) Biscuits (1) 22% Chocolate 29% Gum & Candy 20% Latin America 35% Central & Eastern Europe 24% Middle East & Africa 10% Asia Pacific 31% 70%+ Snacks Beverages 19% Cheese & Grocery 10% (1) Biscuits includes salty/other snacks (2) Based on 2011 reported net revenues; includes accounting calendar changes and 53 Week. rd |
We rank among the leading CPG players in developing markets 15 Source: Company reports and presentations. See page 93 for source details. Percentage of Revenues from Developing Markets 54% 51% 50% 45% 44% 40% 39% 36% 34% 21% 14% 13% 10% 8% 3% |
5-10-10 focus strategy has driven both top- and bottom-line growth 16 Organic Net Revenue Growth (1) Adjusted Segment Operating Income Margin (2) Kraft Foods Developing Markets (1) Organic Net Revenue growth excludes the impact of acquisitions in the first 12 months after the acquisition date. Reported Net Revenue growth for 2010, 2011 and 1H 2012 was 71.1%, 16.2% and 2.2%, respectively. See GAAP to Non-GAAP Reconciliation at the end of this presentation. (2) Adjusted Segment Operating Income margin excludes Integration Program costs and Restructuring Program costs. Reported Segment Operating Income Margin for 2010, 2011 and 1H 2012 was 11.6%, 13.0% and 13.7%, respectively. See GAAP to Non-GAAP reconciliation at the end of this presentation. 9.9% 13.1% 9.5% 11.2% 14.0% 14.2% 2010 2011 H1 2012 2010 2011 H1 2012 |
Three priority clusters within Developing Markets 17 China India Russia Brazil 5-Yr Revenue Growth Outlook % DM 2011 Revenue 33% Mid-to-High Teens BRIC |
Win in BRIC 18 Brazil Revenue: $2+ billion Portfolio 80% Snacks 15% Beverages (powdered) 5% Cheese & Grocery Strategic Priorities “Strengthen the Fortress” Drive growth in North/NE Region Russia Revenue: $1+ billion Portfolio 70% Snacks 30% Beverages (soluble coffee) Strategic Priorities Focus on premium brands Drive global platforms Expand distribution |
Win in BRIC 19 India Revenue: $0.7 billion Portfolio 80% Snacks, primarily Chocolate 20% Beverages (malt) Strategic Priorities Expand Chocolate distribution Launch White Space categories Launched Oreo and Tang in 2011; Toblerone in 2012 China Revenue: $0.8 billion Portfolio 90% Snacks, primarily Biscuits 10% Beverages (powdered, coffee) Strategic Priorities Expand Biscuits distribution Launch White Space categories Launched Stride in August 2012 |
Middle East & Africa Indonesia Three priority clusters within Developing Markets 20 China India Russia Brazil 5-Yr Revenue Growth Outlook % DM 2011 Revenue 33% 12% Mid-to-High Teens Mid-to-High Teens BRIC Next Wave Markets |
Next Wave Markets: Middle East & Africa 21 Region full of opportunities 2 billion consumers by 2020 * Additional $1 trillion of wealth from aspirant and middle class by 2020 * Snacks growing double-digits Well-positioned to capture growth Focused snacks portfolio Broad geographic footprint Established routes-to-market Strong profitability 2011 Revenue: $1.6B * Source: Canback Global Income Distribution Database and Euromonitor. |
Middle East & Africa Indonesia Australia Japan Mexico Central Europe Three priority clusters within Developing Markets 22 China India Russia Brazil 5-Yr Revenue Growth Outlook % DM 2011 Revenue 33% 12% 27% Mid-to-High Teens Mid-to-High Teens Low-to-Mid Single Digits BRIC Next Wave Markets Scale Markets |
North America: Solid growth with margin upside 23 $7 billion (2) Snacks “pure play” Leading share of U.S. Biscuit category, 2x closest competitor Strong #2 player in Gum Opportunity to improve growth and profitability through Focusing on Power Brands Driving global innovation platforms Harnessing power of DSD Optimizing end-to-end supply chain Biscuits (1) 74% Chocolate 5% Gum & Candy 20% Other 1% (1) Biscuits includes salty/other snacks (2) Based on 2011 reported net revenues; includes accounting calendar changes and 53 rd Week. |
Europe: Continue to drive top-tier performance in a challenging environment 24 Biscuits (1) 20% Chocolate 35% Gum & Candy 8% Beverages 24% Cheese & Grocery 13% 60%+ of revenues in Snacks #1 or #2 share in each category Continued margin opportunities Portfolio mix Productivity Overheads $13 billion (2) (1) Biscuits includes salty/other snacks (2) Based on 2011 reported net revenues; includes accounting calendar changes and 53 rd Week. |
Our strategies to deliver top-tier performance 25 Build global Power Brands Leverage global innovation platforms Revolutionize selling Drive efficiency to fuel growth Consistently Deliver Top-Tier Revenue and EPS Growth |
Build Global Power Brands 26 Biscuits 40% of Biscuit Revenue Gum & Candy 60% of Gum & Candy Revenue Chocolate 50% of Chocolate Revenue Drive 70% of Growth |
Leverage Global Innovation Platforms 27 Sustaining Energy Children Wholesome Hunger Satisfaction Teen Market Penetration Advantaged Candy Brands Drive Frequency Bubbly Hollow Wafer Choco-Bakery Bitesize Biscuits Gum & Candy Chocolate |
Revolutionize Selling Near-term focus: – Complete integration of Cadbury – Capitalize on route-to-market capabilities Long-term focus: – Develop best-in-class Instant Consumption Channel / Hot Zone sales and distribution capabilities 28 |
Drive Efficiency to Fuel Growth Expand gross margin – Price to offset input cost inflation – Optimize product mix – Deliver industry-leading productivity Reduce overheads as a percent of revenue – Drive top-line growth – Capture Restructuring Program savings – Align overhead support to growth priorities 29 |
Global Category Teams are the cornerstone of these strategies 30 Drive Bigger, Faster, More Profitable Initiatives Integrated, cross-functional teams driving a common category agenda – Build brand equity – Develop innovation platforms – Prioritize resources |
… with highly experienced leaders 31 Lorna Davis SVP and Global Category Leader Biscuits Jim Cali SVP and Global Category Leader Gum & Candy Bharat Puri SVP and Global Category Leader Chocolate |
Lorna Davis SVP and Global Biscuit Category Leader 32 |
Our global Biscuits business 2011 Revenue: $11 billion 2011 Growth: +9%* – Developing Markets up double-digits – Developed Markets up mid-single digits Global Share Position: #1 $500+ Million Brands: 33 |
Source: Euromonitor 2011 estimates Biscuits Retail Value ($B) CAGR (Cst Fx '09-'11) $75B Biscuit category with developing markets as the primary driver 34 $75 $45 $30 8% 11% 2% Developed Developing Global |
We are the clear global leader 35 Source: 2011 Euromonitor for global shares Global Biscuits Market Share Kellogg Campbell >4x Closest competitor 18% 4% 3% |
Well-positioned to maintain leadership 36 Focus resources in Developing Markets Focus on Power Brands Drive Global Innovation Platforms Hunger Satisfaction Sustaining Energy Children Wholesome |
Focusing resources on Priority Markets 37 12% • Large, high-growth markets that will drive revenue growth • Strong share in 3 of 4 markets % Total Biscuits Revenue 58% • Mature markets with margin upside to fund growth in Developing Markets • Leading market share positions 2% • Mature markets with an opportunity to develop significant biscuit presence • Leverage leadership positions in other categories 2% • Larger Next Wave markets with strong growth potential • Solid market share positions |
Wafer “Green Tea” for Traditional Trade Priority Markets case study: Oreo in China 38 +68% CAGR “Oreo” GLOCAL model: Local Form, Flavors, Formats $130MM Revenue 2009 $375MM Revenue 2011 Form Flavor Packaging Oreo Oreo Oreo |
Power Brand case study: Oreo 39 Capitalize on Strength in Developed Markets Expand in Developing Markets Enter White Space Opportunities Leverage successful US experience, up 7%+ in 2011 Use the “China template” of the Oreo playbook Recent launches in Germany, France, UK, Czech Republic & India – nearly $100MM revenue in 2011 |
Global innovation case study: Sustaining Energy Focused on Breakfast – #2 Snacking Moment Proprietary Sustaining Energy Bundle – Anchors health and wellness credentials Driving Category Growth – 50%+ incremental to category 40 |
Fast track global rollout for belVita 41 2011 Launches 2012 Launches United States Canada Australia Generated nearly $50MM of revenue Spain, Belgium, UK and Brazil |
Drive Power Brands and innovation platforms 42 Focus on Power Brands and Priority Markets Rapidly expand innovation platforms globally 2011 Revenues $11 Billion Continue to grow Mid-to-High Single Digits |
Jim Cali SVP and Global Gum & Candy Category Leader 43 |
Our global Gum & Candy business 2011 Revenue: $6 billion 2011 Growth: +1%* – Developing Markets up mid-single digits – Developed Markets down mid-single digits Global Share Position: #2 in Gum, #1 in Candy $500+ Million Brands: 44 |
CAGR (Cst Fx '08-'11) Gum and Candy are high margin categories with attractive growth rates 45 Gum & Candy Retail Value ($B) $83 Gum Candy Total Candy Gum $48 $35 3% 4% 4% 6% 7% 7% 2% 0% 1% Source: Euromonitor 2011 estimates (Gum Adjusted Nielsen Estimate 2011) Developed Developing Global Gum 10 15 26 26 32 57 |
After a decade of strong growth, the Gum category decelerated over the past 3 years … 46 Gum Category Growth (%CAGR) Key Drivers to Gum Category Slowdown Source: Euromonitor (1998-2010), adjusted Nielsen estimates (2011) Weak macroeconomy – GDP softness – Unemployment – Declining distribution (TDP’s) Brand and A&C support reduced and fragmented Over “premiumization” Penetration losses among teens and lower frequency among adults 7% 3% '98-'08 '08-'11 |
… but the Gum category has strong underlying fundamentals Expandable Consumption – Snack occasions – Impulse-driven – Responsive to innovation and marketing Strong margins fund A&C and innovation investments Led by global players, with product quality and innovation insulated by proprietary technologies 47 |
We are a leader in Gum, with a strong #2 position … 48 Global Gum Market Share Mars-Wrigley Perfetti-Van Melle Source: Gum Adjusted Nielsen Estimate 32% 30% 7% |
… and a proven ability to grow share 49 Global Gum Market Share Value Share based on Euromonitor (’04-’10), Adjusted Nielsen Estimates (’11) Mars- Wrigley |
We have taken near-term actions to grow share and expand the category 50 Price/Size Architecture A&C Support Brand Architecture Drive penetration with entry offers Expand consumption trading up to larger / premium offers Restore A&C support to mid-teens Simplify brand architecture Roll-out integrated marketing campaign Entry Mid Size Value |
Well-positioned to restore growth and increase market share in the long-term 51 Focus resources on Priority Markets Focus on Power Brands Drive Global Innovation Platforms Drive Frequency – Pleasure/Freshness Teen Market Penetration Advantaged Candy Brands |
Focusing resources on Priority Markets 52 28% Large, critical markets with strong growth potential Strong market share % Total Gum & Candy Revenue 20% Larger Next Wave markets with strong growth potential Ability to build on solid market share 19% Mature markets with slow category growth Strong market position 1% White Space market opportunity for Gum Launched in China in August 2012 |
Power Brand case study: China 53 Launched Stride in China in August 2012 Launch Bundle Supply Chain Sales Preferred brand proposition Product and packaging superiority Built strong Hot-Zone/ Impulse capabilities Strong trade reception Best in class manufacturing start up Growth/capacity plans in place |
Power Brand case study: Trident Strong Rights to Win – #1 global gum brand – High historic growth driven by innovation Simplify brand architecture New master brand campaign Innovation to drive growth, new occasions 54 U.S. Brazil Unleash Power of “One” Trident |
Global innovation case study: ID Teen-Specific Gum First-to-Market Technologies Global Roll-Out 55 Heaviest user cohort Gum/Candy flavor blends Printed flavor swirls Magnetic closure Artwork from emerging young artists Launched in U.S. in August 2012 Europe roll-out in Q4 2012 Further geographic expansion 2013-14 Co–created via teen immersion |
Rebuild category growth Focus on Power Brands and Priority Markets Rebuild category growth – Simplify brand and price/size architectures – Step-up innovation – Restore A&C support 56 2011 Revenues $6 Billion Return to Mid-Single Digit Growth |
Bharat Puri SVP and Global Chocolate Category Leader 57 |
Our global Chocolate business 2011 Revenue: $10 billion 2011 Growth: +6%* – Developing Markets up double digits – Developed Markets up low-single digits Global Share Position: #1 $500+ Million Brands: 58 |
Chocolate Retail Value ($B) CAGR (Cst Fx '08-'11) $101B Chocolate category growth driven by developing markets 59 5% $101 $35 $66 10% 2% Source: Euromonitor 2011 estimates Developed Developing Global |
We are a leading chocolate company 60 Source: 2011 Euromonitor for global shares Mars Nestle Ferrero Hershey Lindt Global Chocolate Market Share 15% 15% 12% 7% 7% 4% |
Well-positioned to continue top-tier growth in Chocolate 61 Focus resources on Priority Markets Focus on Power Brands Drive Global Innovation Platforms Bubbly Hollow Wafer Choco-Bakery Bitesize |
Focusing resources on Priority Markets 62 20% Large, fastest growing markets Market share leader or strong #2 with fabric-of-the-nation Power Brands Scale advantage; able to step change growth trajectory % Total Chocolate Revenue 42% Big, mature markets with strong presence Leveraging Power Brands to compete and win in broader Snacking Large markets, big growth potential Able to leverage route-to-market capabilities 4% Big Bets Next Waves Scale |
India Brazil Russia Belgium UK 2.0 0.1 18.6 1.4 22.2 4.6 42.5 5.2 55.7 10.5 3,400 10,900 15,900 37,900 35,100 8.3 7.5 3.8 2.1 1.6 Affinity Countries: • So. Africa • Indonesia • China • Egypt • Argentina • Mexico • Turkey • USA • Germany • France • Austria • Ukraine • Poland Developing Markets will be the primary driver of our future growth 63 Source: Euromonitor, AC Nielsen/ TNS Worldpanel, Kraft Market Maturity modeling GDP growth will power consumption in Developing Markets GDP/capita ($) GDP growth (%) Snacks pcc (kg) Chocolate pcc (kg) |
Priority Markets case study: India 64 $0.25B Revenue 2009 $0.5B Revenue 2011 +37% CAGR Mainstream Aspirants More Special Category growth delivered through a consumer & portfolio strategy Gifting |
65 Power Brand case study: Cadbury Dairy Milk & Milka, together over $3B |
Global innovation case study: Bubbly 66 An aerated chocolate with an innovative, playful mood that makes chocolate tablets more exciting Brazil Launched June 2012 Performing above expectations Will be in 20 major countries by end of 2013! United Kingdom Launched February 2012 Most successful NPD in the UK in the last 5 years Germany & Austria Launched May 2012 Biggest selling SKU in the Big Size range |
Bringing the magic of our Power Brands into new incremental snacking occasions Global innovation case study: Bitesize 67 United Kingdom • Launched in 2009 • NPD’s growing the category: Twirl Bites, Bitsa Wispa, Popcorn Continental Europe Launched in 2011 Strong share performance and repeat in all key markets Rolling-out to over a dozen countries by end of 2012! |
Continue to exceed category growth rates Focus on Power Brands Focus on Priority Markets – Lead Developing Markets growth – Drive category growth in Developed Markets through broader Snacking Expand innovation platforms globally 68 2011 Revenues $10 Billion Continue to Grow Mid-to-High Single Digits |
Dave Brearton EVP and CFO 69 |
Growth algorithm driven by virtuous cycle 70 Expand Gross Margin Reinvest in Growth Leverage Overheads Focus on Power Brands & Priority Markets |
Expand gross margin 71 Price to offset input cost inflation Optimize product mix Target productivity of 4%+ of COGS Key Enablers Expand Gross Margin Reinvest in Growth Leverage Overheads Focus on Power Brands & Priority Markets |
Leverage overheads 72 Top-Line Growth Capture Restructuring Program savings Align overhead spending to growth priorities Key Enablers Expand Gross Margin Reinvest in Growth Leverage Overheads Focus on Power Brands & Priority Markets |
Reinvest in Growth 73 Priorities Investments weighted towards Developing Markets Focus investments on Power Brands and innovation platforms Capitalize on White Space opportunities Expand Gross Margin Reinvest in Growth Leverage Overheads Focus on Power Brands & Priority Markets |
Strong KFT results in 1H 2012 Kraft Foods (KFT) 2012 guidance – Organic Net Revenue growth of around 5% – Operating EPS of at least 9% on a constant currency basis 1H’12 results in-line with guidance – Organic Net Revenue growth +4.9%* – Operating EPS +11.4%* on a constant currency basis Confirmed constant currency EPS guidance in early August – 1H’12 FX impact was $(0.02) – Estimate ~$(0.08) total FX impact for FY’12 (using average August 2012 currency rates) 74 * Reported Net Revenues declined (0.3)%. Diluted EPS increased 2.0%. See GAAP to Non-GAAP reconciliation at the end of this presentation. |
2012 full year financials represent blend of KFT and Mondelez results Q1-Q3 to reflect Kraft Foods Group as “Discontinued Operations” Q4 presentation to be based on actual revenue realized and costs incurred Full year results include variety of items – Stranded costs – Tax rate anomalies – Cadbury Integration Program – 2012-2014 Restructuring Program – Spin-Off Costs and debt migration costs 75 - |
Transaction-related and restructuring costs 76 KFT MDLZ ($ billions) Pre- Spin Post- Spin Spin-Off Costs $0.5 $0.1 Restructuring & Implementation Costs $0.3 $0.8 Debt Migration Costs $0.2 $0.4 - $0.6 |
Long-term financial targets will deliver top-tier performance 77 Driving Shareholder Value Long-Term Target Organic Net Revenue Growth 5%-7% Operating EPS Growth Double-Digit (constant FX) |
Revenue growth target reflects large, growing Developing Markets contribution 78 Double Digit Growth Low-to-Mid Single Digit Growth NA EU DM NA EU DM 5%-7% Organic Growth $36B * * Based on 2011 reported net revenues; includes accounting calendar changes and 53 rd Week. |
Long-term EPS target reflects the following assumptions Operating income growth of high single digits Interest expense essentially flat – Opening debt balance of ~$20B, weighted average interest rate of ~5.75% Tax rate in the mid-20’s 79 Double-Digit Operating EPS Growth (constant FX) |
Priorities for free cash flow Reinvest in the business to drive top-tier growth Tack-on M&A, especially in Developing Markets Return of capital to shareholders Pay down debt to preserve balance sheet flexibility 80 Disciplined Capital Deployment |
2013 outlook consistent with long-term profile Organic net revenue growth of 5%-7% Operating EPS of $1.50 - $1.55 – Strong Operating Income growth at constant FX – Significant FX headwind of $(0.15) vs. average 2011 rates* – Tax rate in the mid-20’s 81 * Based on average August 2012 currency rates |
Long-term targets reflect benefits of driving a virtuous cycle 82 Expand Gross Margin Reinvest in Growth Leverage Overheads Focus on Power Brands & Priority Markets Operating EPS Growth 5%-7% Double-Digit (constant FX) Organic Net Revenue Growth Long-Term Targets |
Irene Rosenfeld Chairman and CEO 83 |
Mondelez International is a unique investment vehicle 84 Fast- Growing Categories Advantaged Geographic Footprint Favorite Snacks Brands Strong Route-to- Market Proven Innovation Platforms World-Class Talent & Capabilities - |
Joining for Q&A 85 Sanjay Kholsa President Developing Markets Tim Cofer President Europe Mary Beth West EVP and Chief Category and Marketing Officer Mark Clouse President North America |
86 |
Average foreign currency rates for key countries 87 Russian Ruble Mexican Peso Euro Indian Rupee Brazilian Real Canadian Dollar 31.92 / $US 13.17 / $US US$1.24 / € 55.51 / $US 2.03 / $US US$1.01 / $Cdn August 2012 Australian Dollar Pound Sterling US$1.57 / £ US$1.05 / AUD August 2011 28.67 / $US 12.20 / $US US$1.43 / € 45.28 / $US 1.59 / $US US$1.02 / $Cdn US$1.64 / £ US$1.05 / AUD Source: Oanda Swiss Franc 0.88 / $US 0.78 / $US |
Key to flags used in presentation 88 Indonesia Australia Czech Republic Russia Mexico Ukraine Belgium European Union India Spain Colombia Argentina Egypt Japan Austria Turkey Brazil United Kingdom Poland France China South Africa Hungary Germany United States Canada Saudi Arabia Switzerland |
Developing Markets as a percentage of revenue – source detail Unilever – Emerging markets per 2011 annual report Danone – Emerging markets per 2011 results presentation Colgate – Emerging markets per 2011 annual report Coca-Cola – Pacific, Latin America, Eurasia & Africa, Bottling Investments per 2011 10-K (note: developing and emerging markets represent 57% of volume per CAGNY 2012 presentation) Nestlé – Emerging markets per 2011 annual report P&G – Developing markets per fiscal 2012 earnings call Kimberly-Clark – Asia, Latin America and Other per 2011 10-K PepsiCo – Developing and emerging markets per CAGNY 2012 presentation Heinz – Emerging markets per fiscal 2012 annual report Kellogg – Emerging markets pro forma for Pringles per CAGNY 2012 presentation Clorox – Latin America and Asia fiscal 2011 per CAGNY 2012 presentation Hershey – Sales outside NA are 10% of net revenue with Mexico, Brazil, China and India about 7% of net revenue per Investor Day presentation June 2012. General Mills – Asia Pacific, Latin America per fiscal 2012 earnings release Campbell – Developing markets per Deutsche Bank Consumer Conference presentation June 2012 89 |
GAAP to Non-GAAP Reconciliation 90 As Reported (GAAP) Impact of Divestitures (1) Impact of Accounting Calendar Changes Impact of Currency Organic (Non-GAAP) As Reported (GAAP) Organic (Non-GAAP) 2012 Kraft Foods 26,379 $ - $ - $ 884 $ 27,263 $ (0.3)% 4.9% 2011 Kraft Foods 26,451 $ (91) $ (361) $ - $ 25,999 $ (1) Impact of divestitures includes for reporting purposes Starbucks CPG business. Net Revenues to Organic Net Revenues For the Six Months Ended June 30, ($ in millions, except percentages) (Unaudited) % Change |
GAAP to Non-GAAP Reconciliation 91 As Reported (GAAP) Integration Program costs (1) Spin-Off Costs (2) 2012 - 2014 Restructuring Program costs (3) Operating (Non-GAAP) Currency (4) Operating Constant FX (Non-GAAP) As Reported EPS Growth (GAAP) Operating EPS Growth (Non-GAAP) Operating Constant FX EPS Growth (Non-GAAP) 2012 Diluted EPS attributable to Kraft Foods 1.03 $ 0.04 $ 0.12 $ 0.06 $ 1.25 $ 0.02 $ 1.27 $ 2.0% 9.6% 11.4% 2011 Diluted EPS attributable to Kraft Foods 1.01 $ 0.13 $ - $ - $ 1.14 $ - $ 1.14 $ (1) Integration Program costs are defined as the costs associated with combining the Kraft Foods and Cadbury businesses, and are separate from those costs associated with the acquisition. Integration Program costs were $78 million, or $73 million after-tax including certain tax costs associated with the integration of Cadbury, for the six months ended June 30, 2012, as compared to $240 million, or $234 million after-tax for the six months ended June 30, 2011. (2) Spin-Off Costs represent non-recurring transaction and transition costs associated with preparing the businesses for independent operations consisting primarily of financial advisory fees, legal fees, accounting fees, tax services and information systems infrastructure duplication, and financing and related costs to redistribute debt and secure investment grade ratings for both the North American Grocery Business and the Global Snacks Business. Spin-Off Costs for the six months ended June 30, 2012 were $301 million, or $202 million after-tax and include $162 million of pre-tax financing and related costs recorded in interest and other expense, net. (3) Restructuring Program costs for the six months ended June 30, 2012 were $169 million, or $107 million after-tax and represent non-recurring restructuring and related implementation costs reflecting primarily severance, asset disposals and other manufacturing related non-recurring costs. (4) Includes the favorable foreign currency impact on Kraft Foods foreign denominated debt and interest expense due to the strength of the U.S. dollar. Diluted Earnings per Share to Operating EPS For the Six Months Ended June 30, (Unaudited) % Growth |
GAAP to Non-GAAP Reconciliation 92 As Reported (GAAP) Impact of Divestitures Impact of Acquisitions (1) Impact of Integration Programs Impact of Accounting Calendar Changes (2) Impact of Currency Organic (Non-GAAP) As Reported (GAAP) Organic (Non-GAAP) For the Twelve Months Ended December 31, 2010 13,613 $ - $ (4,753) $ 1 $ (150) $ 15 $ 8,726 $ 71.1% 9.9% 2009 7,956 $ (14) $ - $ - $ - $ - $ 7,942 $ For the Twelve Months Ended December 31, 2011 15,821 $ - $ (379) $ 1 $ (183) $ (397) $ 14,863 $ 16.2% 11.2% 2010 13,613 $ (105) $ - $ 1 $ (148) $ - $ 13,361 $ For the Six Months Ended June 30, 2012 7,821 $ - $ - $ - $ - $ 459 8,280 $ 2.2% 9.5% 2011 7,656 $ - $ - $ - $ (92) - $ 7,564 $ Net Revenues to Organic Net Revenues ($ in millions, except percentages) (Unaudited) % Change Kraft Foods Developing Markets (1) Impact of acquisitions reflects the operating results from our Cadbury acquisition on February 2, 2010. (2) Includes the impacts of accounting calendar changes and the 53 week of shipments in 2011. rd |
GAAP to Non-GAAP Reconciliation 93 As Reported (GAAP) Integration Program Costs (1) Acquisition- Related Costs (2) Spin-off Costs (3) 2012 - 2014 Restructuring Program Costs (4) Adjusted (Non-GAAP) Segment Operating Income 1,577 $ 181 $ 25 $ - $ - $ 1,783 $ Segment Operating Income Margin 11.6% 13.1% Segment Operating Income 2,053 $ 161 $ - $ - $ - $ 2,214 $ Segment Operating Income Margin 13.0% 14.0% Segment Operating Income 1,069 $ 39 $ - $ - $ 5 $ 1,113 $ Segment Operating Income Margin 13.7% 14.2% Kraft Foods Developing Markets Operating Income To Adjusted Operating Income ($ in millions, except percentages) (Unaudited) (1) Integration Program costs are defined as the costs associated with combining the Kraft Foods and Cadbury businesses, and are separate from those costs associated with the acquisition. (2) Acquisition-related costs include transaction advisory fees, U.K. stamp taxes and the impact of the Cadbury inventory revaluation. (3) Spin-Off Costs represent non-recurring transaction and transition costs associated with preparing the businesses for independent operations consisting primarily of financial advisory fees, legal fees, accounting fees, tax services and information systems infrastructure duplication. (4) Restructuring Program costs represent non-recurring restructuring and related implementation costs reflecting primarily severance, asset disposals and other manufacturing related non-recurring costs. For the Twelve Months Ended December 31, 2010 For the Twelve Months Ended December 31, 2011 For the Six Months Ended June 30, 2011 |
GAAP to Non-GAAP Reconciliation 94 Mondelez International Pro Forma Continuing (1) (GAAP) Impact of Divestitures Impact of Acquisitions (2) Impact of Integration Program Impact of Accounting Calendar Changes Impact of Currency Mondelez International Pro Forma Organic (Non-GAAP) Mondelez International Pro Forma Continuing (1) (GAAP) Mondelez International Pro Forma Organic (Non-GAAP) 2011 Biscuits 10,997 $ - $ - $ - $ (221) $ (219) $ 10,556 $ 11.8% 8.9% Chocolate 9,566 - (287) - (143) (361) 8,775 15.6% 5.9% Gum & Candy 5,698 - (382) 1 (3) (158) 5,155 8.9% 0.8% 2010 Biscuits 9,837 $ - $ - $ - $ (147) $ - $ 9,690 $ Chocolate 8,276 11 - 1 (3) - 8,285 Gum & Candy 5,231 (117) - - (0) - 5,114 Net Revenues to Organic Net Revenues by Global Category For the Twelve Months Ended December 31, ($ in millions, except percentages) (Unaudited) % Change - - - - |