chew on this
Posted by Mark J. Miller on September 7, 2012 02:31 PM
Time to hide the children and batten down the hatches. Kraft Foods is “ready to unleash a global snacking powerhouse,” chairman and CEO Irene Rosenfeld told investors and analysts in the company's presentation at the Barclays Back to School conference in Boston on Thursday.
The snacks behemoth will officially launch the Mondelez brand for the global marketplace on Oct. 3 and is hoping that consumers in China, India, and Brazil start chowing down more and more on such products as Oreo cookies (a $2 billion brand thanks to glocal versions in China), Cadbury chocolates, and Trident gum. Kraft will maintain another division under the Kraft name that will focus solely on the North American marketplace and features such grocery staples as Velveeta and Oscar Mayer.
While the CPG giant is predicting to have a 2013 profit of $2.60 per share, according to the AP, it is also expecting Mondelez to not come zooming out of the gate.
It's hard to be too optimistic given the continuing financial crisis in Europe (making for some nasty exchange rates) and the fact that teens don’t have as much money to throw around, partially due to high unemployment. While chocolate sales are up, gum is down: “About 26% of gum is chewed at work and 16% on the way to work,” according to Kraft research, so when work is down, gum sales go down.
Still, Rosenfeld projects long-term growth as the collective sweet tooth of those in such markets as Russia and China are tempted by the company’s products. Of course, that’s if the people of Russia aren’t offended by the Mondelez corporate name, which reportedly sounds like a whole other kind of business to their ears.