Economic Value Added (EVA)
EVA is registered trademark of Stern Stewart.
Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.
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Mondelēz International Inc. pages available for free this week:
- Income Statement
- Analysis of Solvency Ratios
- Analysis of Geographic Areas
- Enterprise Value (EV)
- Dividend Discount Model (DDM)
- Return on Equity (ROE) since 2005
- Total Asset Turnover since 2005
- Price to Earnings (P/E) since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Sales (P/S) since 2005
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Economic Profit
Mondelēz International Inc., economic profit calculation
US$ in millions
| 12 months ended: | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|---|
| Net operating profit after taxes (NOPAT)1 | ||||||
| Cost of capital2 | ||||||
| Invested capital3 | ||||||
| Economic profit4 | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 NOPAT. See details »
2 Cost of capital. See details »
3 Invested capital. See details »
4 2024 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= – × =
- Net Operating Profit After Taxes (NOPAT)
- The net operating profit after taxes exhibited fluctuations over the five-year period. Starting at $3,858 million in 2020, it increased substantially to $4,733 million in 2021. It then experienced a significant decline to $3,016 million in 2022 before rebounding strongly to $5,433 million in 2023. In 2024, NOPAT slightly decreased to $5,271 million but remained near the higher levels observed in 2023.
- Cost of Capital
- The cost of capital showed a gradual upward trend from 8.42% in 2020 to a peak of 9.03% in 2023, indicating a rising hurdle rate for investments. In 2024, it decreased somewhat to 8.78%. This suggests increased risk perception or changing market conditions that impacted the required returns during the period.
- Invested Capital
- Invested capital remained relatively stable, fluctuating within a narrow range. It started at $61,366 million in 2020, increased slightly to $63,833 million in 2022, then declined to $60,269 million by 2024. This overall stability suggests limited expansion or contraction in capital investments over the five years.
- Economic Profit
- Economic profit was negative throughout the period, although the magnitude of the losses varied. The economic loss was largest in 2022 at -$2,549 million and improved significantly to nearly break-even by 2023 with a loss of -$118 million. By 2024, the economic loss further diminished to -$18 million, indicating improving value creation despite remaining slightly below the cost of capital.
- Overall Analysis
- The company demonstrated improved operational profitability in 2023 and 2024 compared to earlier years. However, the elevated cost of capital and negative economic profit indicate the profits were not sufficient to generate positive economic value during the period under review. The stability in invested capital, combined with fluctuating profitability, suggests operational challenges impacting efficiency or margins. The narrowing negative economic profit towards 2024 may signal ongoing efforts to align returns with capital costs.
Net Operating Profit after Taxes (NOPAT)
Mondelēz International Inc., NOPAT calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Elimination of deferred tax expense. See details »
2 Addition of increase (decrease) in allowances for credit losses.
3 Addition of increase (decrease) in restructuring Program liability.
4 Addition of increase (decrease) in equity equivalents to net earnings attributable to Mondelēz International.
5 2024 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =
6 2024 Calculation
Tax benefit of interest expense, debt = Adjusted interest expense, debt × Statutory income tax rate
= × 21.00% =
7 Addition of after taxes interest expense to net earnings attributable to Mondelēz International.
- Net Earnings Attributable to Mondelēz International
- The net earnings demonstrated a fluctuating trend over the five-year period. Starting at 3,555 million US dollars in 2020, earnings increased notably to 4,300 million in 2021, showing significant growth. However, in 2022, there was a considerable decline to 2,717 million, representing a substantial decrease. The earnings then rose sharply in 2023 to reach 4,959 million, the highest point in the period under review, followed by a slight decline in 2024 to 4,611 million. Despite the fluctuations, the earnings in 2024 remained well above the 2020 level.
- Net Operating Profit After Taxes (NOPAT)
- The NOPAT exhibited a similar pattern to net earnings, evidencing growth from 3,858 million US dollars in 2020 to 4,733 million in 2021. There was a decline in 2022 to 3,016 million, although this was less pronounced than the drop in net earnings. In 2023, NOPAT increased sharply, reaching 5,433 million, the peak during the period. A marginal decrease to 5,271 million occurred in 2024, yet the level remained significantly higher compared to the start of the period.
- General Observations
- Both net earnings and NOPAT show a cyclical pattern with peaks in 2021 and 2023, and troughs in 2022. The recovery after 2022 is strong, indicating resilience and effective operational performance. The overall upward trend from 2020 to 2024 reflects improvement in profitability and operational efficiency, despite the mid-period dip. The differences in magnitude of the declines and recoveries between net earnings and NOPAT may suggest varying impacts of operational and non-operational factors on profitability.
Cash Operating Taxes
Mondelēz International Inc., cash operating taxes calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Provision for Income Taxes
- The provision for income taxes fluctuated over the five-year period. It decreased from 1224 million USD in 2020 to 865 million USD in 2022, indicating a downward trend during these years. However, the figure rose sharply to 1537 million USD in 2023, the highest level in the series, before slightly declining to 1469 million USD in 2024. This pattern suggests variable tax charges, possibly influenced by changes in profitability, tax regulations, or accounting estimates.
- Cash Operating Taxes
- Cash operating taxes demonstrated a generally volatile trend as well. Starting at 1387 million USD in 2020, there was a decline to 1003 million USD by 2022. Subsequently, the amount increased substantially to 1697 million USD in 2023, marking the peak in this timeframe. The value then decreased to 1328 million USD in 2024. This fluctuation may reflect differences in actual cash paid versus tax provisions, timing of payments, or underlying operational profitability.
Invested Capital
Mondelēz International Inc., invested capital calculation (financing approach)
US$ in millions
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Addition of capitalized operating leases.
2 Elimination of deferred taxes from assets and liabilities. See details »
3 Addition of allowance for doubtful accounts receivable.
4 Addition of restructuring Program liability.
5 Addition of equity equivalents to total Mondelēz International shareholders’ equity.
6 Removal of accumulated other comprehensive income.
7 Subtraction of construction in progress.
- Total reported debt & leases
- The total reported debt and leases displayed a fluctuating trend over the given periods. It initially decreased from 20,706 million USD in 2020 to 20,145 million USD in 2021. However, it rose significantly to 23,613 million USD in 2022, indicating a marked increase in leverage or obligations during that year. Subsequently, the debt declined again to 20,110 million USD in 2023 and further decreased to 18,544 million USD in 2024, suggesting efforts to reduce debt levels after the peak in 2022.
- Total Mondelēz International shareholders’ equity
- Shareholders’ equity showed moderate variation but remained relatively stable throughout the years. An increase was observed from 27,578 million USD in 2020 to 28,269 million USD in 2021, followed by a decline to 26,883 million USD in 2022. Equity then recovered to 28,332 million USD in 2023 before a slight decrease to 26,932 million USD in 2024. These fluctuations may reflect changes in retained earnings, share repurchases, or other equity transactions.
- Invested capital
- Invested capital exhibited an overall stable pattern with some minor fluctuations. Starting at 61,366 million USD in 2020, it increased marginally to 61,560 million USD in 2021 and reached a peak of 63,833 million USD in 2022. However, it dropped to 61,495 million USD in 2023 and further declined to 60,269 million USD in 2024. This trend indicates that the company maintained a steady level of capital investment with slight adjustments possibly related to asset acquisitions or disposals and working capital changes.
Cost of Capital
Mondelēz International Inc., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2024-12-31).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2023-12-31).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2022-12-31).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2021-12-31).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2020-12-31).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
Economic Spread Ratio
Mondelēz International Inc., economic spread ratio calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Economic profit1 | ||||||
| Invested capital2 | ||||||
| Performance Ratio | ||||||
| Economic spread ratio3 | ||||||
| Benchmarks | ||||||
| Economic Spread Ratio, Competitors4 | ||||||
| Coca-Cola Co. | ||||||
| PepsiCo Inc. | ||||||
| Philip Morris International Inc. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Economic profit. See details »
2 Invested capital. See details »
3 2024 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
- Economic Profit
- The economic profit shows considerable volatility over the observed period. Starting with a negative value of -1310 million USD in 2020, it improved to -609 million USD in 2021, indicating a reduction in losses. However, there was a significant deterioration in 2022, with economic profit plunging to -2549 million USD. This negative trend subsequently reversed, showing a recovery to -118 million USD in 2023 and further improvement to -18 million USD in 2024. Overall, while economic profit remains negative throughout, the trend indicates a gradual reduction in economic losses by the end of the period.
- Invested Capital
- Invested capital remained relatively stable across the five years under review. It started at 61,366 million USD in 2020, rising marginally to 61,560 million USD in 2021 and further to 63,833 million USD in 2022. Subsequently, it declined to 61,495 million USD in 2023 and continued this descent to 60,269 million USD by the end of 2024. This pattern suggests an initial increase in capital investment followed by a cautious reduction in invested capital in the latter years.
- Economic Spread Ratio
- The economic spread ratio, indicating the return on invested capital relative to its cost, remained negative throughout the period. Beginning at -2.14% in 2020, it improved to -0.99% in 2021, then deteriorated markedly to -3.99% in 2022. Following this low, a strong recovery took place with values narrowing the negative gap to -0.19% in 2023 and further to -0.03% in 2024. Although the ratio remains below zero, the movement reflects improving operational efficiency and a narrowing shortfall relative to the cost of capital.
- Summary Insights
- The data reveals a company facing challenges in generating positive economic profit over the five-year span. There is evidence of a significant setback in 2022, echoed by heightened negative economic profit and spread ratio, which may point to adverse operational or market conditions during that year. However, the subsequent recovery in 2023 and 2024 suggests effective management responses aimed at cost control and capital efficiency. Invested capital levels show stability with a minor reduction in recent years, possibly indicative of a strategic emphasis on optimizing asset utilization. Despite ongoing negative economic profit, the narrowing economic spread ratio implies progress toward achieving returns closer to or surpassing their cost of capital.
Economic Profit Margin
Mondelēz International Inc., economic profit margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Economic profit1 | ||||||
| Net revenues | ||||||
| Performance Ratio | ||||||
| Economic profit margin2 | ||||||
| Benchmarks | ||||||
| Economic Profit Margin, Competitors3 | ||||||
| Coca-Cola Co. | ||||||
| PepsiCo Inc. | ||||||
| Philip Morris International Inc. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Economic profit. See details »
2 2024 Calculation
Economic profit margin = 100 × Economic profit ÷ Net revenues
= 100 × ÷ =
3 Click competitor name to see calculations.
- Net Revenues
- The net revenues demonstrated a consistent upward trend over the period. Starting at 26,581 million US dollars at the end of 2020, revenues increased each year, reaching 36,441 million US dollars by the end of 2024. This represents a significant growth trajectory, underscoring a positive performance in sales or service delivery.
- Economic Profit
- Economic profit displayed a fluctuating pattern with notable volatility. Initially, there was a negative economic profit of -1,310 million US dollars in 2020, which improved markedly in 2021 to -609 million US dollars. However, in 2022, economic profit sharply declined to -2,549 million US dollars, the lowest point in the observed timeframe. Following this dip, there was a recovery trend in 2023 and 2024, with economic profits improving to -118 million and -18 million US dollars respectively, approaching break-even levels.
- Economic Profit Margin
- The economic profit margin mirrored the economic profit's volatility. It was negative throughout the period, starting at -4.93% in 2020, improving to -2.12% in 2021, then worsening significantly to -8.09% in 2022. Subsequently, the margin improved substantially to -0.33% in 2023 and further to -0.05% in 2024, indicating a reduction in losses relative to net revenues and suggesting progress toward profitability.
- Overall Analysis
- While net revenues consistently increased over the years, economic profit and the associated margin remained negative, indicating that profitability challenges persisted. The marked downturn in 2022 could be indicative of extraordinary costs or operational inefficiencies during that year. The recovery in economic profit and margin post-2022 suggests that corrective measures or changes in business conditions helped in reducing economic losses. However, the near-zero margins in 2023 and 2024 imply that the company is still in the process of reaching positive economic profitability despite solid revenue growth.