(Reuters) -Mondelez International Inc raised its full-year sales and profit forecasts on Tuesday as people continued to snack on the Oreo maker’s chocolates and biscuits despite higher prices.
Shares of the Chicago-based company rose about 3% in extended trading, as it also trumped Wall Street targets for third-quarter results.
While surging inflation and fears of a recession have dampened consumer confidence, shoppers are still willing to indulge on “affordable luxuries” such as their favorite snacks and beverages instead of switching to cheaper brands.
That has helped Mondelez and a number of other food companies including Cheerios maker General Mills Inc and soda giants Coca-Cola Co and PepsiCo Inc boost their annual forecasts.
Known for its Cadbury chocolates and Sour Patch candy, Mondelez posted a 19.7% surge in quarterly revenues from emerging markets – which includes Latin America, India and China. Developed markets showed just a 1.5% rise.
Europe, a market that accounts for about 40% of Mondelez’s sales, recorded a 2.4% fall as soaring rent and energy costs forced consumers to rein in spending on snacks.
In contrast, revenues from North America rose nearly 20%.
Mondelez said it now expects 2022 organic net revenue to increase more than 10%, compared with its prior estimate for an over 8% jump.
It forecast 2022 adjusted profit per share would grow more than 10% on a constant-currency basis, compared with its previous expectation for mid-to-high single-digit growth.
For the third quarter ended Sept. 30, net revenue rose 8.1% to $7.76 billion, above estimates of $7.44 billion, according Refinitiv IBES.
Excluding one-time items, the company earned 74 cents per share, compared with estimates of 69 cents.
(Reporting by Deborah Sophia in Bengaluru; Editing by Devika Syamnath)
