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(Reuters) -Mondelez International Inc beat Wall Street estimates for quarterly results on Tuesday, bolstered by higher prices and resilient demand, but the Oreo maker warned of a hit to full-year profit from the Russia-Ukraine conflict.
The war has exacerbated the pain for packaged food makers by sparking a rally in wheat, corn and protein prices when they are still struggling with global supply-chain snarls, higher freight costs and labor shortages.
Mondelez expects adjusted full-year profit to rise in the mid-to-high-single-digit range, compared to its prior outlook for a high single-digit growth.
Analysts on average were expecting annual profit to rise 6.9% to $2.98 per share, according to Refinitiv IBES data.
“We expect elevated levels of input cost inflation to continue through the remainder of the year, and we will continue to take necessary actions to offset this dynamic,” Chief Executive Officer Dirk Van de Put said in a statement.
The Cadbury maker recorded $143 million of total expenses in the reported quarter as a direct result of the Ukraine crisis.
Net earnings attributable to Mondelez fell to $855 million, or 61 cents per share, in the first quarter ended March 31, from $961 million, or 68 cents per share, a year earlier.
Still, higher product prices and strong growth in the company’s emerging markets helped lift the Trident gum maker’s organic revenue 8.6% in the first three months of the year, and fueled a raise in its full-year core sales forecast.
Mondelez now expects organic net revenue to increase over 4% in 2022. It had previously expected growth in line with its long-term target of more than 3%.
Net revenue rose 7.3% to $7.76 billion in the quarter, topping analysts’ average estimate of $7.39 billion.
Excluding items, the Ritz crackers maker earned 84 cents per share, above analysts’ average estimate of 74 cents.
Reporting by Deborah Sophia in Bengaluru; Editing by Krishna Chandra Eluri
