Mondelez at Barclays Conference: Strategic Adaptation Amid Challenges

Mondelez International (NASDAQ:MDLZ) presented its strategic outlook on Wednesday, 03 September 2025, at the Barclays 18th Annual Global Consumer Staples Conference. The company addressed its resilient strategy amid consumer behavior shifts and input cost volatility, reaffirming its full-year 2025 organic sales growth guidance of 5% despite challenges such as U.S. retailer destocking and hot weather in Europe affecting chocolate demand.

Key Takeaways

• Mondelez maintains a 5% organic sales growth target for 2025, despite challenges.
• The company is managing cocoa price volatility and exploring alternative sourcing.
• Strategic collaborations with companies like Coca-Cola and Biscoff aim to drive innovation.
• Emerging market strategies focus on brand building and distribution, targeting China, India, Brazil, and Mexico.
• Capital allocation remains disciplined, prioritizing strategic acquisitions and share buybacks.

Financial Results

• Mondelez anticipates a 4-5% top-line growth in 2025, with a 10% EPS decline due to cocoa costs.
• An "on-algorithm" year is expected in 2026, with cocoa costs projected to decrease.
• Organic sales in North America declined by approximately 3.5% year-over-year in the first half.

• European elasticity trends have shifted from 0.3x at the year’s start to 0.6-0.7x in Q3.
• Cocoa prices are expected to decrease due to increased supply and decreased demand, with cocoa pod counts in West Africa up 7% against the five-year norm.

Operational Updates

• U.S. retailer destocking is largely resolved.
• Hot weather in Europe impacted chocolate consumption, particularly in the UK and Germany, with high stock levels expected to affect Q3 revenues.

• In China, Mondelez sees positive growth through market share gains and distribution expansion, despite cautious consumer spending.
• India experiences a slowdown in consumer spending, particularly in biscuits, but maintains solid single-digit growth.
• Brazil and Mexico show varying growth patterns, with Brazil expecting good single-digit growth and Mexico facing a slowdown.

Future Outlook

• Consumer caution is expected to persist for the next 6-12 months.
• Cocoa supply from West Africa is projected to increase due to higher prices incentivizing investment.

• Mondelez’s investment strategy includes a focus on bolt-on acquisitions in chocolate, biscuits, and baked snacks.
• A "non-algorithm" year is anticipated in 2026 with high single-digit EPS growth.

Q&A Highlights

• North American consumers are maintaining basket spend but shifting towards necessities. Oreo’s penetration is increasing, though purchase frequency and quantity are decreasing.

• Pricing and promotions need adjustments, with Oreo packs in the U.S. requiring prices below $4 and more significant in-store presence and events.

For a detailed understanding, readers are encouraged to refer to the full transcript below.

Full transcript - Barclays 18th Annual Global Consumer Staples Conference 2025:

Andrew, Host: Great. Good morning, everybody. Welcome back to day two of our Global Staples Conference. Hopefully, everyone had a productive first day. No shortage of headlines and news to process without question, and I’m sure there’s a lot more to come.

We’re really thrilled to have Mondelez International here with us again today. With us, we’ve got Chairman and CEO, Dirk Van de Putt CFO, Luca Zaramella. Welcome, gentlemen. Thank you. Hi.

Thanks so much for being here. Maybe a good way to start it off is with you, Dirk. A lot of topics to cover, obviously, including cocoa, U. S. Cookie and biscuit trends, pricing elasticities in Europe and the overall health of the consumer and whatnot.

But maybe starting a little bit bigger picture first. I think if we take a step back and you think back to the company’s strategic launch in 2018, you managed to deliver through lots of volatility, very consistent results, at least in line with your long term algorithm. And I’m curious if the shifts over the past year or so in consumer behavior and input cost volatility require a different strategic approach now or just more tactical moves as you continue to sort of work through it?

Dirk Van de Putt, Chairman and CEO, Mondelez International: Yes. Good question. In fact, we have asked ourselves the same question, obviously, as we saw the different trends around the world emerge because the strategy that we had put in place in 2018 had worked very well. So we asked an outside in opinion, and the conclusion of that opinion was in line with what we were thinking that the strategy long term strategy is still very valid. The slowdown that we, for instance, see in the snacking consumption in The U.

S, we went quite deep to understand what’s going on with the consumer. And we believe that for our categories, 90% of the slowdown is driven by the economic circumstances of the consumer. There’s a little bit about protein that could be having an effect on our categories, but there is nothing structural to our opinion. We still believe that our strategy of building presence in the three, four categories that we want to be really present around the world, supporting our brands, driving distribution, reinvesting in the business and so on, is still very, very valid. However, on the short term, it is clear to us that ’25 and potentially 2026, we need to play a little bit different, more short term oriented.

So in 2025, our way of thinking about it is, particularly in Chocolate, we want to deliver what we would call a reasonable P and L, which is a reasonable top line growth, as we have said, sort of 4%, 5% and then a bottom line, which is a 10% EPS decline. That’s not great, but seeing the circumstances with cocoa, we thought that was an acceptable P and L and we still have sight to deliver that, while at the same time trying to protect the category and making sure that consumers do not exit the category. So far, so good, I would say. For next year, what we are planning to do is we think, first of all, that cocoa will help and that cocoa costs will come down versus where they are this year. That will give us some extra margin of which we will reinvest part and flow a part to the bottom line, delivering an on algorithm year.

So I would say in 2026, we’re kind of back on our strategy. We will continue to monitor what’s happening to the consumer because there is many things going on. But at this stage, we don’t think that there’s a structural change in our categories that would require a change of strategy. Great. Okay.

Andrew, Host: Thank you for that. And then Luca, I think it makes sense maybe to dig in a little bit to the company’s recent second quarter earnings in late July a bit more, where you reaffirmed your full year 25% organic sales growth guidance of about 5%. Also noted that U. S. Retailer destocking, which was a headwind in each of the year’s first two quarters along with the impact of hotter weather in Europe that led to softer chocolate demand for a short period of time have resulted in sort of additional headwinds to the year maybe that have reduced the company’s flexibility, I think as you termed it, for the full year outlook.

Maybe you can expand a little bit on what you’ve seen in August as it pertains to sort of retailer destocking and whether the weather in Europe has sort of normalized over the past month or so.

Luca Zaramella, CFO, Mondelez International: Yes. Thank you, Andrew, for the question. So as we look at the first half, it is without any doubt that the couple of headwinds you mentioned were not contemplated in our original thinking for 2025 plus. So they came a little bit unexpected. I have to say the trade destocking in The U.

S. Is behind us, because actually we run now at quite low level and going lower would put most likely at risk service levels. And I would say, all things considered and considering that we are increasing prices in The U. S, that was not a bad thing at all, but it is for the most part behind us. As far as the hot weather went, I think you saw the temperatures by yourself in Europe.

Chocolate consumption is impacted and was impacted by hot weather, particularly in The UK, Germany that are the biggest markets that we have in Europe. And so the headwind partly materialized in Q2, but importantly, the high level of stock we enter Q3 with is going to have a little bit of an impact in revenues in Q3. As far as elasticities go, we started the year in Europe with very benign elasticities. The price was implemented. It hit the shelves and we didn’t see material dislocation in terms of volume.

In Q2, it is tough to discern what is hot weather and what is real elasticity. But as we enter Q3, I think elasticities are a little bit higher than what we would have expected. But quite frankly, the big activation that is happening in back to school and importantly, the preparation for the Christmas season is going to tell us what the elasticities really are. We still believe that our brands are quite strong. As we mentioned a few times, we have implemented PPA as well, price pack architecture in Europe specifically to protect specific price points.

There is a plan in terms of promo activities to stimulate consumptions. And so we’ll have to see how Q3 plays out. But importantly, I believe Christmas is going to be a strong season for chocolate in Europe. Okay.

Andrew, Host: Thank you. Dirk, organic sales in North America declined about 3.5% year over year in the first half. Some of it, as we just discussed, was a result of retailer destocking. But I think even underlying trends have anticipated. And really across the broader packaged food space, we’ve been hearing from companies that the return to volume growth has, of course, been longer and more expensive than initially expected.

What’s your view on what’s going on in North America? How do you expect the next six to twelve months to look, I guess, both from a consumer standpoint and for Mondelez more specifically?

Dirk Van de Putt, Chairman and CEO, Mondelez International: Yes. Sort of first of all, if we go to the consumer, and I had some conversations with colleagues in other categories in food and drinks, and we’re all seeing the same thing. The basket of the consumer, the money they spend when they do their shopping trips, it doesn’t depend of which social class they’re in, in the last twenty four to thirty months has not gone up. So the consumer is spending exactly almost exactly the same amount of money now for two point years. If you think about it, in those two point years, prices of everything have gone up.

The consequence of that is that the quantities they bought overall have come down and that they have mixed a little bit in what they buy. They go first to their basic necessities, bread, milk and so on. And then there’s a part of the basket that they will use on things like snacking. And so what we’re seeing is this is a reflection of what the consumer is doing. They have no inclination to increase their spending.

They’re very aware that they need to be careful. They’re unsure about what’s going to happen, when those tariff effects really are going to hit them. And so they I think for the foreseeable next six to twelve months, until they will start to feel different about the future, they’re not going to change the way they shop. If anything, they could become even more careful. Now they’re doing a number of things.

They’re switching channels, trying to go where things are cheaper. They are going for different pack sizes. They might decide on certain shopping trips not to buy certain items and so on. So for us, the name of the game is really to see how can we optimize those shopping trips and how can we maximize our chances of being in that basket. What we, for instance, see is on OREO in The U.

S, the yearly penetration is going up. So more families are buying OREO on a yearly basis. However, if you then start to drill down, the frequency at which they buy is going down and the quantity they buy is going down. So they’re still in the brand, but not as frequent as before. So the way we’re trying to react to that is to offer, for sure, the product at the right price point.

So we know we have to be below $4 That’s typically what they want to spend for a pack of Oreo. We also know that they’re very interested in multipacks. I would say the less than $4 packs is more for the lower social classes. The multipacks, we see the higher social classes going to those. We also know that your typical price promotion 30% off is not necessarily cutting it anymore.

So what we need is promotions that have the price off, but that also have a big team around them that gets big presence in store and will make the consumer, even if they were not planning to buy Oreo on that trip, they will still do it. So that’s why we do Oreo and Reese’s or we did Oreo and Coca Cola. We have a Selena Oreo at the moment. So we’re trying to create events that will draw in the consumer. So long story short, I think we will manage it as well as we can from a top line perspective.

We’re doing the things that I was explaining. We are also, for instance, shifting more of our focus on the channels where the consumer is shifting to. But overall, I’m expecting another six to twelve months of tough sledding in North America. Okay.

Andrew, Host: Thanks for that. Dirk, I guess sticking with you and on the theme you just talked about, over the last couple of years, you really upped the level of engagement with other large companies in this space through partnerships, right, whether it be the Coke Oreo piece that you debuted here last year, Milka Biscoff activations over the past year and then more recently, obviously, the Reese’s Oreo, the one which looked delicious. I guess can you talk a bit about why you’re excited about these sorts of collaborations? And maybe what’s important for investors to know here? Like how can these be a win win, given that some of these, like with Biscoff, it’s a biscuit player globally as well, a competitor but yet also potentially can bring more for both in these types of arrangements?

Dirk Van de Putt, Chairman and CEO, Mondelez International: Yes. Well, the collaboration has kind of emerged through conversations with with the different companies. Sometimes they initiated it, sometimes we initiated it. And it basically was starting with what you were saying, is there a win win here which we can have? In its most basic formats, which would be the Reese’s example or the Coca Cola example, we find a way that we can launch a very exciting innovation in our product range and they do the same on Reese’s.

They will have Reese’s with Oreo included, which is also available here somewhere. And so that is that was to say with Coca Cola, they lost a Coca Cola product with Oreo taste. We had our Oreo with Coca Cola. The Biscoff is different in the sense that there we are really looking, can we find a way where potentially we are competitors. But if you start to look a little bit deeper, we are not really stepping into each other’s territory.

I think the Biscoff consumption moment is very different from, for instance, the Oreo consumption moment. And we don’t really have cookie that we particularly position with coffee. And yesterday, we were talking about Biscoff for those that don’t know, means biscuit and coffee, and it’s particularly developed to eat with a coffee. In fact, I’m from Belgium, so I know how it should be done.

Andrew, Host: You have

Dirk Van de Putt, Chairman and CEO, Mondelez International: to dip it in the coffee

Andrew, Host: and then eat it. So I was yesterday years old when I actually learned that that’s what that meant by the way, so

Dirk Van de Putt, Chairman and CEO, Mondelez International: I should have known that. So Biscoff, in a good market, will reach a two percent, 3% market share. Oreo, in a good market, can reach 20% market share. Now of course, Biscoff wants to increase their market share. We want to increase ours.

But we’re not in the same territories. I think Biscoff wants to be globally present, but they accept that emerging markets are going to be difficult for them. We are good in emerging markets. So there’s certainly an opportunity there. In a country like India, you really want to produce in India.

For them to put down manufacturing assets is a real big deal. So I think there’s a win win in developing emerging markets with them. And then on the other side, I think our chocolate with Biscoff, which is the other example that we have here, is a really exciting chocolate innovation. And so if you look at and then we’re also doing ice cream together. So that’s a much wider collaboration.

My personal guess is that between the two companies, the net revenue we will generate five, ten years down time, let’s say, ten years down the road, could be easily around $1,000,000,000 So that’s a completely different collaboration. I think in a world where M and A is more difficult and very expensive, These collaborations are a way to get the excitement without having to go to M and A, and every company feels good with what we’re doing. So I’m seeing us doing more of these in the future.

Andrew, Host: You. Luca, maybe we touched on this a little bit earlier. But in Europe, obviously, you put through a significant amount of pricing recently. I mean at least through the second quarter, right, elasticity has remained pretty in line with what your expectations were, if not even a little bit better. You called that obviously hotter than typical temperatures and then hampered chocolate volumes in the region a bit.

I guess what makes you confident that it was sort of higher temperatures and not the higher prices, I guess, that resulted in sort of the softer demand? And you’re talking about elasticity maybe creeping up a little bit of late. Where what kind of range are we talking about? Originally, you were looking for maybe the 0.4, 0.5. Where are we today?

And how do we think that makes the sort of the full year end up at this stage?

Luca Zaramella, CFO, Mondelez International: So it’s clearly very hard to discern what was weather driven versus what was elasticity driven. The facts are that as we enter the year and we implemented prices, we were looking at elasticity levels that were around about 0.3 times. So quite in line even better than what we had anticipated. But as we said, we did a great job activating Easter. And we know that particularly around big seasons like Easter and Christmas, propensity for consumers to pay is relatively higher.

I think as we look at what happened in Q2, the volume declines were a little bit more severe. And obviously, there is a weather component. As we enter Q3, we started looking at elasticities that are around about 0.6, 0.7 times around Europe overall. So they are a little bit higher compared to the norm that we had in mind at 0.4 times. And I think the question becomes as consumer get used to these new price levels and as consumers start engaging even more with back to school and Christmas with the category, we will be looking at is maybe a little bit different.

And then look, I think quite frankly, if cocoa starts coming down, we might have to adjust certain price points. And remember that as a company, I mean, we have a chocolate intensity compared to other players in Europe that is a little bit higher. So that’s the other element that comes into play, because some other players that are private have a portfolio that is not as chocolate intensive as us. So I think it is a little bit too early to draw conclusions. But I would say elasticities at this point are higher than what we had anticipated.

But again, we believe that going into Christmas, particularly with the engagement with the consumers, we’ll have better elasticities than today. Great.

Andrew, Host: And Luca, sticking with you here, mean, you’ve been pretty consistent in your messaging, right, that you do not view sort of current cocoa levels as sustainable, right, based on what your view of sort of industry supply dynamics looks like. I guess what’s your most current view on cocoa fundamentals? And are you taking any specific actions to try and reduce that cocoa risk going forward with alternative sourcing and things of that nature?

Luca Zaramella, CFO, Mondelez International: Yes. So, when you really look closely at the fundamentals of cocoa, what drove the cocoa spikes that we have seen in the last few months? It is actually the fact that the biggest cocoa producer, which is West Africa, declined supply last year quite dramatically. And that drove a panic in the market. The market at the beginning didn’t believe in certain cocoa level prices.

The industry overall went very short in terms of coverage and then panic really drove prices up. As we stand today, we do pop counts in West Africa fairly consistently every three, four weeks. The latest pot counts point in a direction that supply of cocoa at this point in time with pots still not yet fully mature to be able to say that will translate into real cocoa supply. The cocoa pod count in Africa is up 7% versus the last five year norm and so materially higher versus last year crop. We know that the soil moisture is quite good at this point in time and that is essential for the next phase of pulp development and cocoa supply.

We also know that as we close Q2, grindings, which is cocoa processing and a proxy for cocoa consumption was down 7% to 8%. And so that leads us to believe that with a given supply that is up most likely more than 5% compared to the last five year norm and a demand that is going down by 7%, eight percent in the latest reading, we believe there is going to be a surplus in the market. And that will determine most likely cocoa prices to come down. The rest of the world, which is around about 30% of the total cocoa production keeps on growing in terms of supply at 5% per annum and that’s the forecast for next year. And you might imagine that at these price levels, there is clearly an element of increasing supply outside of West Africa.

And so that leads us to believe that cocoa prices will have to adjust. Now to your question, we are very excited about the fact that there are at least two, three opportunities in terms of long term supply. Clearly, West Africa with current prices has an incentive to invest more in cocoa productions unlike what they have done in the last few years. And so with agronomical practices, better practices, hopefully supply will continue to grow. I think the rest of the world clearly attracted by the current cocoa levels.

And even if there was a decline in cocoa prices of 30%, the economic around cocoa would be very compelling. And finally, as you said, there is cocoa grown labs, which is fermented cocoa that can be grown in a lab that is something we are closely monitoring. We made some investments. And so hopefully, that will evolve over time and will allow for a more steady, more reliable supply of cocoa over time.

Andrew, Host: Great. Maybe, Dirk, shifting to emerging markets. One of the main things that sets Mondelez apart, obviously, from many other domestic packaged food companies is not only your exposure to emerging markets, but the scale you’ve been able to build in many of these markets like Mexico, India, Brazil, China. You’ve set some pretty lofty targets for growth across these markets. And I guess the question is what will it take to sort of make good on those expectations, both in terms of time and incremental investment?

And how do you think about prioritizing each of these markets and initiatives such as expanding OREO globally and things of that nature? And then how are things looking in a lot of these emerging markets more currently?

Dirk Van de Putt, Chairman and CEO, Mondelez International: Yes. Yes. So if you take a look at the growth of our categories in volume terms for the next ten years, a very big percentage will come from emerging markets. Now of course, you’re always in discussion, will that come at the right dollar value? Yes or no.

But if you look over the longer term, even in Latin America, but certainly in places like India and China, that has been a very solid growth. You cannot look it on a year by year basis, but if you take, let’s say, ten years, you will see that the benefit is quite big. So for us as a company, it is important to be there on the long term because that’s where the growth is going to come from. If you then start to look at the markets, there’s a few that are very important, and you mentioned the four that at this stage for us are quite important. The name of the game there is to build strong brands.

So we invest quite heavily in A and C. China has the biggest percentage of A and C of any of our markets in the world. As an example, India is also quite high. And so we try to build over time strong brands. Cadbury in India or an Oreo in China are really powerhouse brands.

We try to do the same in Latin America. So that certainly is an investment. The other one is driving distribution. And so we go mostly to market through local distributors. So the capital investment is relatively limited for us.

It’s not our trucks. What we do is VZ Coolers in the hot climate for the chocolate. So that certainly is a capital investment every year, but I would say that is a reasonable capital investment that we have to make. There is a limit to the speed of how fast you can do that. You need to stay on top of things.

You go city by city. You need to monitor very carefully. Is it paying back? Is it not paying back? So you count, for instance, in China, we’re at the moment in 3,000,000 or 6,000,000 stores.

We cannot say, okay, in one year, we’re going to add another 3,000,000 stores. That would be not you have to go at a certain speed. The speed at the moment is somewhere for India and for China around $100,000 100,000 stores per year. That is the so we still have a runway, quite a long runway. The second name of the game is not only more stores, it’s more items per store.

That’s the second area of growth. And so we look at the number of SKUs available on average in a store in a country. If you look at the brand building and the distribution building, so the two avenues of growth for us in these markets, we should be close to double digit. We get to high single digit usually, sometimes double digit. And of course, in the current circumstance, that’s a bit slower also in China and in India and also in Mexico.

But overall, I would say, the idea of what I just explained, once the consumer will feel a little bit better, we think

Andrew, Host: we will get back to that algorithm for those countries. And sort of current trends as you see them in key emerging markets at this point?

Dirk Van de Putt, Chairman and CEO, Mondelez International: Quickly, China consumer is still very sort of very careful. We see them diminishing their consumption. Through the fact that we are doing quite well in our categories, gaining market share and the fact that we’re building distribution, are seeing positive growth in China. India for us, the consumer clearly was slowing down, particularly in a category like biscuits, which is a very basic category in India. We started diminishing of the concentration of an Oreo, which is a premium.

Chocolate continued reasonably well, I would say, despite the fact that we increased some prices. But overall, we saw a slowdown in India, but we’re still solid single digit growth. Brazil is doing quite well. We will have good single digit growth this year in Brazil, and we’re developing well. And then in Mexico, we see a slowdown in the consumer offtake in general.

But since we’ve had two years that we were underperforming, we will look good because we lapped something that was

Andrew, Host: not so great, Perfect. Thank you. And Dirk, historically, Monolith has chosen to invest some of the upside, right, in order to maintain the solid top line of volume momentum and keep the flywheel going, which sort of sets you apart from a lot of your peers. That strategy has worked well. Obviously, we’re in a bit of an anomalous situation when thinking about next year just given the magnitude of cocoa inflation being absorbed this year.

I guess should investors expect or still expect Mondelez to sort of adhere to this reinvestment strategy going forward, even if there’s, let’s say, potential for more upside should cocoa moderate significantly, just given how much justified pricing has been needed really the past couple of years? And are there a few areas where you would likely reinvest for ’26, if that were the case?

Dirk Van de Putt, Chairman and CEO, Mondelez International: Yes. So our algorithm has always been that we look at gross profit dollars as the key driver of our performance. And the thinking has always been, we drive gross profit dollar growth. We have had that conversation many times. We are not obsessed by the percentage.

The percentage needs to be healthy, but we’re not managing towards a percentage of the business. And so what we always did in the last seven, eight years was the gross profit dollars go up. The difference that we get extra every year, about half of it flows to the bottom line, about half gets reinvested. This year is an abnormal year. The gross profit dollars go down because of the issue with the cocoa prices.

So we did the same. We reduced our A and C, largely in nonworking media, and we took a hit on our bottom line. For next year, I’m expecting our gross profit to start increasing again, and we would normally do the same and reinvest but also flow to the bottom line. Now at a certain stage, cocoa could come down quite a bit, let’s say. And then it could be in those years that we decide that we’re not going to be do the rough fifty-fifty, but that we are going to flow more to the bottom line.

Our first concern is do we get a return on the investment? Do we drive our categories? Do we drive our gross profit dollars? And there could be a moment that we say, well, that’s not going to be giving us the right return, it’s better to put it in the bottom line. But in general, I think next year, are aiming for a non algorithm year, which is high single digit EPS growth.

And then after that, I’m expecting at a certain year that Cocoa really will come down, that might be the year that we decide to put more.

Andrew, Host: Got it. Got it. Helpful. Luca, maybe turning to capital allocation and M and A. There obviously is some speculation earlier in the year about your potential interest in another large U.

S. Chocolate player. And you’ve kind of put those rumors to rest since. But maybe you can remind investors what your strategy around M and A looks like, whether it’s changed at all in the context of sort of the current environment, where there’s a lot of news? And how do think about M and A versus sort of share buybacks as well?

Luca Zaramella, CFO, Mondelez International: We continue to be very disciplined in terms of assessing potential targets out there. And we said it many times, few assets came our way, and we passed on them because the value proposition for us wasn’t right. As we put together business propositions, we are fairly thorough. We have an M and A department that conducts very thorough due diligence. So we know pretty much what are the issues and the opportunities as we go into any type of M and A.

At this point in time, I wouldn’t rule anything out. But quite frankly, if you ask me, likely that if we do M and A, it is more on the bolt on areas. Assets that have a size of €05,000,000,000 €1,000,000,000 €2,000,000,000 max, I would say. Assets that play in the categories we like, chocolate, biscuits and importantly, baked snacks, whether it is cakes and pastries, fresh or non fresh, I would say. And assets in some cases that are out of these categories, but would give us the opportunity like Ricolino in Mexico to really establish ourselves as a key player in snacking through our core brands like Oreo or chocolate brands like Milk and Cadbury in case, again, the asset provides distribution opportunity.

That’s really where we are, very disciplined, strategically sound asset, assets that are, I would say, $05,000,000,000 to €1,000,000,000 in general in terms of revenue. When you look at share buybacks, it is undoubtful that we have been quite pragmatic in the way we have done share buybacks in the last few years. Clearly, with cost of capital going up, there is a different trade offs, which makes us be a little bit more cautious in terms of share buybacks. But we have done share buybacks this year, I think, at very compelling prices. And again, should cocoa come down, I think we will look at an earnings power that is materially higher.

And if we compound that earning power with fewer stuff, fewer shares being out there, obviously, the earnings power will be even further amplified. So at this point in time, we are more pragmatic in terms of share buybacks. But obviously, between share buybacks and M and A, it seems to us at this point in time that share buybacks is a more compelling opportunity given the current stock price. Great.

Andrew, Host: Thanks for that. And then I think we’ve got time for one more before we head to the breakout. So maybe, Dirk, one area that you’ve been much more vocal about right of late has been the opportunity, I believe, you still have in sort of the growing and still very fragmented cakes and pastries space. I think you’ve talked about you’re currently the third largest global player with only about a 4% share. You recently acquired eBirth in China, which operates in this space.

So I guess if we were to look five to ten years sort of down the road, what do you expect the cake and pastries category to look like versus where it is today? And sort of how do you see Mondelez’s sort of position within that evolving?

Dirk Van de Putt, Chairman and CEO, Mondelez International: So Cakes and Pastries at the moment is about the €95,000,000,000 global category, so not too far away from the size of the Biscuits category. We expect about a 4% growth of that revenue. So probably going to be about €125,000,000,000 by 02/1930. It’s a very fragmented category, which has different segments in there. And we think there is really an opportunity to offer higher quality products with known brands.

And so that’s what we believe is our opportunity. So we’ve been trying to position ourselves in the cakes and pastries category in a number of ways. So if there’s one segment in cakes and pastry, which is the fresh part in store, that’s where give and go comes in play, but also evert. And so that’s an experience for a consumer where they take it home and then consume it. It’s delivered frozen into the store.

We think you can have high quality products where the consumer is prepared to per kilo to pay a very nice price. And for them, it’s a different experience from the packaged cakes and pastries. So that’s one segment we see ourselves developing in globally. The other one, I think, is more sophisticated packaged products like the Oreo cakes that we have at the moment in China and in The U. S, which I think stand above what is generally available in the market.

And so we see, for instance, the soft cake version of Oreo stands very well next to the biscuit version globally. That’s the second area where we’re trying to develop in. And then the third one is what we call Choco bakery, where we use our chocolate brands to bring the chocolate experience into the cakes and pastries. We do it in biscuits also, but we believe there’s a huge opportunity. So the biggest example of those are the Milka products that we have in Europe, the soft cake Milka products.

Or recently, we with the acquisition of Chepita, we now have Milka Croissant that is being offered. So those, I would say, are the three big segments that we believe in cakes and pastry. We don’t try to be in L segments for everybody. We try to be in high quality, high net revenue per kilo products and bring our own brands into that market. Super.

Andrew, Host: All right. Very helpful. We covered a lot of ground, so really appreciate you both being here. Please join us in the breakout, and please join me in thanking Dirk and Luca for being here. Thanks, Andy.

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