GST, Cy­ber­at­tacks Weigh on Mon­delez’s Top Line

Global rev­enue took 260 bps hit in Q2, says co; ex­pects bet­ter H2 show

The Economic Times - - Brands: Creating Desire - Sa­gar.Malviya @times­

Mumbai: Snack gi­ant Mon­delez In­ter­na­tional said a com­bi­na­tion of cy­ber­at­tacks and goods and ser­vices tax (GST) in In­dia im­pacted global rev­enues by 260 ba­sis points.

“Our se­cond quar­ter re­sults were largely in line with our ex­pec­ta­tions, ab­sent the mal­ware in­ci­dent and the tran­si­tion im­pact of the In­dia GST, which were a com­bined head­wind of 260 ba­sis points to our top line growth,” Brian Glad­den, CFO at Mon­dele z, said at an in­vestors call on Wed­nes­day.

“Ex­clud­ing th­ese items, our organic net rev­enue growth would have been essen­tially flat. The im­pact of th­ese in­ci­dents masked solid re­sults in a num­ber of ar­eas.”

Mon­delez, the world’s se-

cond-largest con­fec­tionery com­pany, wit­nessed ship­ping and in­voic­ing de­lays caused by a cy­ber­at­tack dur­ing the last week of June, and much around the same time, the In­dian mar­ket was pre­par­ing for a new tax regime that prompted traders and re­tail­ers to halt their pur­chase from con­sumer goods com­pa­nies. The maker of Cad­bury and Oreo said In­dia busi­ness could have grown in dou­ble dig­its, but due to the im­pact of GST grew mid-sin­gle digit. “Choco­late con­tin­ued to be strong as we ex­e­cuted our plans, and the over­all mar­ket con­di­tions re­mained good,” said Glad­den.

The com­pany said it ex­pects to re­cover in the se­cond half, and also ex­plained that the base quar­ters have seen is­sues such as de­mon­eti­sa­tion.

The In­dian mar­ket con­trib­utes about 4% to Mon­delez’s global sales, but the coun­try is in­creas­ingly be­com­ing im­por­tant for sales and pro­duc­tion

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.