Mondelez International Inc (MDLZ)

North America Consumer Outlook
Q: Do we need more aggressive pricing in North America?
A: The consumer situation in North America is stabilizing but remains soft. - Consumers feel tension due to inflation and have changed where they shop, favoring value clubs and Walmart. - We don't think a full price reset is needed but will focus on improving sales through smarter promotions, launching smaller packs at $3 to $4 price points, and driving distribution. -

European Volume Growth
Q: What drives confidence in Europe's volume growth?
A: European consumers are cautiously optimistic with rising incomes and softening inflation. - While elasticities have increased slightly, they remain modest. - Our biscuits and baked snacks grew 2.8% in value and 0.8% in volume in Q2. - With pricing actions completed and key activations like back-to-school and Christmas, we expect a good second half in Europe. -

Full-Year Guidance and EPS Outlook
Q: How can you hit revenue guidance and keep EPS unchanged?
A: We're on track with our expectations. - To reach the upper end of our 3–5% revenue growth guidance, Europe must return to volume growth, U.S. biscuits need positive volume, and comparisons will ease due to prior-year discontinuations. - Despite strong year-to-date results, unchanged EPS guidance accounts for increased cocoa costs in the second half and continued investments. -

Cocoa Commodity Costs
Q: How are you managing cocoa price volatility?
A: We believe cocoa prices will correct; current spot price is £6,500 per ton, with a future gap of £2,200. - We have increased physical coverage into 2025, with about 25% of positions hedged via futures. - The rest is covered through derivatives allowing us to participate in potential price adjustments. - We have protection for most of our positions into 2025. -

Free Cash Flow Guidance
Q: Can free cash flow guidance be raised above $3 billion?
A: Yes, excluding one-time items, our cash flow is running at $4 billion plus. - With top-notch cash conversion and ongoing productivity initiatives like SAP implementation, we believe we can strive for more than $4 billion on an ongoing basis. -

Gross Margin Expectations
Q: Will gross margins decline as previously expected?
A: We anticipate gross profit dollar growth ahead of our usual algorithm. - While cocoa is a material headwind in the second half, and we may invest selectively, we're cautious but optimistic about our profitability. -

Biscoff Partnership
Q: What's the potential of the Biscoff partnership?
A: We'll co-brand chocolate products with Biscoff, a popular European biscuit brand. - Our similar OREO line generates several hundred million in sales in Europe, and we have similar expectations for Biscoff. - If successful, we'll extend globally. Additionally, we'll manufacture and sell Biscoff in India starting in the second half of 2025. -

Mexico Market Conditions
Q: What's impacting performance in Mexico?
A: Market conditions are healthy with mid-single-digit growth in biscuits and chocolate. - A temporary reduction in public subsidies due to elections affected candy and chocolate sales, but we expect normalization in the second half. - Integration with Ricolino is going well, boosting our market presence. -

India Distribution Expansion
Q: Are you expanding distribution in India despite challenges?
A: Yes, despite flat growth in Q2, we're expanding distribution aggressively. - We've added 140,000 stores and 90,000 visi-coolers in H1 '24. - We cover over 3 million outlets, with significant headroom in a market of 9 million food retail outlets. -

ERP Transition Impact
Q: Will the ERP transition affect operations in 2025?
A: The ERP rollout will be completed over a four-year timeframe using a staggered approach. - We're carefully managing resources and modules to minimize potential issues, so we don't expect significant operational impact in 2025. -