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Mondelez CEO Talks State Of Snack Market With CNBC

Mondelez CEO Talks State Of Snack Market With CNBC

Snack company Mondelez International Inc (NASDAQ: MDLZ) reported Tuesday with first-quarter results that arrived better than expected. On Wednesday, CEO Dirk Van de Put was a guest on CNBC's "Squawk on the Street" segment to discuss the company's performance and outlook.

International Markets

Mondelez's international revenue grew 8.4 percent in the quarter due to investments in communications for its brands and optimizing its supply chain, Van de Put told CNBC. The company is also increasing its pace of innovation, which helps contribute to growing momentum, he said. 

The executive said the company found success in Brazil after a difficult period last year. Other key markets performed well, including India, which saw a double-digit growth rate; and China, which grew by a mid-single digit, Van de Put said. 

"We still have a lot of open space in those markets, so that's really what is driving our growth." 

Millennials Want Their Parents' Cookie Brands

Many millennials are turning away from old-school brands that have been around for decades — but that isn't the case for Oreo. Van de Put said Oreo is "one of the most loved brands" among millennials and Generation Z. The iconic cookie brand managed to evolve "as a brand with the time" and address consumers' desire for new flavors and experiences with brands, he said. 

"The purpose of the brand is to stay playful," Van de Put said. "It's a message about growing older but staying yourself."

The company's other flagship brand, Cadbury, continues to connect well with the younger generation, as evidenced by a near double-digit growth rate, the CEO said. 

Wasabi Oreos? 

Mondelez's new lines of Oreo flavors have some questioning if there is such a thing as going to far, CNBC's Carl Quintanilla said.  Van de Put responded that Mondelez does a lot of testing on new ideas and is careful not to bring local tastes to the global market. For example, the company sells wasabi and hot chicken Oreo product in China, he said. 

Oreo flavors North American consumers might be more aware of — such as peanut butter — falls within "in-and-out" categories, Van de Put said. If the product isn't living up to expectations, it can be removed from the market and replaced with a new flavor, he said. 

Asking About Edibles 

Mondelez is an operator of family friendly brands, so an expansion into CBD would be inconsistent with its brand image, Van de Put said.

Nevertheless, the company has been exploring the space in terms of the claimed benefits of CBD — and it is likely a major food brand could make a large push in the space in the near-term, he said. 

"It's obvious that the edibles space in that universe is going to be interesting and something to watch." 

Related Links:

UBS Lifts Mondelez International Price Target Ahead Of Q1 Print

Analyst: Kellogg Trims The Fat By Selling Keebler, Other Snack Brands


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