The head of Mondelez International said demand for his company's snack offerings will remain robust even after the coronavirus has ended as the maker of Oreo and Chips Ahoy benefits from a resurgence in demand from emerging markets and channels such as convenience stores hit hard by the pandemic.
CEO Dirk Van de Put said while sales of biscuits and chocolates are doing well in grocery, trade and mass retailers in developed markets like the U.S. as consumers stockpiled candy and snacks during the coronavirus, demand struggled for a time in Asia and Latin America and continues to slump in places such as Mexico and the Middle East.
Once these regions improve, and convenience and other away-from-home categories reopen domestically, Mondelez should continue to reach its goal of increasing revenue 3% annually even if purchases for at home consumption slip from their recent highs.
"Going forward, I think our categories will do slightly better," Van de Put said. "We count on the fact that we should be able to gain market share."
Since taking the helm of Mondelez in November 2017, the former McCain Foods CEO has improved innovation in the company's pipeline and pushed more decision making on both its global brands and more than 60 local brands to regional executives who are more attuned to the product and what consumers in the area want.
When the pandemic took hold, Van de Put said he pulled back temporarily on local control in favor of a more centralized approach to keep workers safe, ensure factories were running and product was getting delivered to store shelves and that Mondelez was in a position to communicate with its consumers.
"I took back a little bit of that decentralization for a short while saying, 'No, now I’m going to decide because we’re in a crisis and we don’t have time to lose here,” he said. As Mondelez has grown more comfortable operating during the outbreak, it has gone back to the decentralized process championed by Van de Put.
Similar to other food manufacturers during the coronavirus, Mondelez has invested heavily in its brands to keep customers coming back after the pandemic has abated. The company also has reduced its snack and candy offerings to prioritize the most popular products and ease pressure on its supply chain.

The changes appear to be paying off. Mondelez’s revenue during the third quarter rose 4.9% to $6.67 billion. In North America, comparable sales rose 6.3% from a year ago. Van de Put said Mondelez, which owns brands such as Triscuit, Ritz and Cadbury, has grabbed market share from its competitors, and noted that demand for the company's offerings would remain "elevated" for a while.
Since Van de Put took the helm three years ago, Mondelez has eschewed the bigger deals completed by many of its CPG competitors. Instead, it has bulked up on snacks by purchasing brands such as premium cookie maker Tate's Bake Shop for about $500 million in 2018, and last year acquiring a majority stake in Perfect Snacks, the manufacturer of organic, non-GMO, nut butter-based protein bars and bites. Earlier this year, it added a majority interest in Give & Go, a North American leader in fully-finished sweet baked goods.
"We like bolt-ons because we can be a bit more surgical in what we want," Van de Put said.
The company is focused on bolt-on opportunities, he said, and while not opposed to a bigger deal, there are few potential targets that are predominately snacking. Mondelez was spun out of Kraft Foods in 2012, separating the faster-growing global snacking giant from its parent, known for its U.S.-based brands such as Velveeta cheese and Oscar Mayer cold cuts.
A hypothetical deal with a bigger company would risk bringing Mondelez into categories where it doesn't want to be, Van de Put said.
“Anything else [beyond snacking] we would end up with categories that we’re not too enthusiastic about, and we would be back to what we left behind us basically," he said. "That makes the big deals for us so difficult. We don’t want to get into categories that are not growing and from day one we're going to be wondering what are we going to do with this.”
While its snack sales remain robust, Mondelez's gum and candy segment has struggled as people have stayed in more and cut down on trips to convenience stores, squeezing sales for brands such as Stride, Trident and Sour Patch Kids. Sales for candy and gum during the third quarter dipped 18%, Van de Put said. Mondelez said in a statement it wrote down the value of four gum brands, a small biscuit brand and one small candy citing lower-than-expected growth, though it didn't specify the products.
Van de Put did not say whether the company was considering divesting candy and gum. Mondelez, he said, is constantly reviewing the categories it operates in and determining what, if anything, it needs to do to reinvigorate ailing brands. The company also owns nonsnacking brands such as Tang orange drink and Halls cough drops.
"For sure that exercise is going on. We would not be good stewards of the company if we were not doing that, but where we end up I cannot tell at the moment," he said. Mondelez is always looking for areas to spur growth and whether it needs to adjust part of its portfolio or exit certain categories "because they are holding us back. I cannot see how that will ever stop. That's an ongoing process."