UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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| Item 7.01. | Regulation FD Disclosure. |
Mondelēz International, Inc. and subsidiaries (collectively, “we,” “our” or “Mondelēz International”) are furnishing this current report to provide supplemental non-GAAP financial information related to the retrospective impact of our decision to include the initial impacts from all enacted tax law changes, rather than only material tax law changes, in the definition of the items excluded from our non-GAAP financial measures. We added this exclusion to our non-GAAP financial measures as the initial impacts from all enacted tax law changes, as described further below, do not reflect our ongoing tax obligations under these changes. This change has resulted in the recasting of our historical non-GAAP financial results and provides additional information to facilitate comparisons of historical operating results, identify trends in our underlying operating results, and provide additional insight and transparency on how we evaluate our business.
Change to our Historical Non-GAAP Financial Results
Recently enactments of tax law changes have become more frequent, especially as governments address the fiscal effects related to COVID-19. These enactments can result in significant impacts on financial results. For example, tax rate increases were enacted in the Netherlands in December 2020 and the United Kingdom in June 2021.
In the past, we adjusted our non-GAAP financial measures to exclude the initial tax impacts caused by material tax reforms, specifically the 2017 U.S. tax reform and the 2019 Swiss tax reform. To standardize our treatment, we are modifying our definition of our non-GAAP financial measures to exclude initial impacts from all enacted tax law changes. Initial impacts include items such as the remeasurement of deferred tax balances and the transition tax from the 2017 U.S. tax reform. This change will also be reflected in the definition of our proportionate share of our equity method investees’ significant operating and non-operating items that we exclude from our non-GAAP financial measures.
Therefore, we will remove these initial impacts from all enacted tax law changes not previously excluded from our non-GAAP financial results for Adjusted EPS for all historical periods presented. Our U.S. GAAP results, which include the historical initial impacts from these enacted tax law changes, will not change from what was previously reported.
Recast Amounts Reflecting Changes in Historical Non-GAAP Results
The change to our non-GAAP financial results for Adjusted EPS described above does not affect our non-GAAP financial results for Organic Net Revenue, Adjusted Gross Profit or Adjusted Operating Income for any period. This supplemental disclosure does not amend any disclosure contained in any of our prior SEC filings. See the chart below and Exhibit 99.1 for the unaudited GAAP and recast non-GAAP financial information for the first quarter of 2021, all quarters of 2020 and 2019 and years ended December 31, 2020, and 2019.
Mondelēz International, Inc. and Subsidiaries
Recast Amounts Reflecting Impact from Enacted Tax Law Changes
(in millions of U.S. dollars, except per share data)
(Unaudited)
| 2019 FY |
2020 FY |
2019 | 2020 | 2021 | ||||||||||||||||||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | Q1 | Q2 | Q3 | Q4 | Q1 | ||||||||||||||||||||||||||||||||||||
| Reported (GAAP) |
||||||||||||||||||||||||||||||||||||||||||||
| Equity method investment net earnings |
$ | 501 | $ | 421 | $ | 166 | $ | 109 | $ | 114 | $ | 112 | $ | 121 | $ | 106 | $ | 84 | $ | 110 | $ | 78 | ||||||||||||||||||||||
| Provision for income taxes |
2 | 1,224 | 189 | 216 | (633 | ) | 230 | 148 | 341 | 391 | 344 | 212 | ||||||||||||||||||||||||||||||||
| Net earnings attributable to Mondelēz International |
3,929 | 3,555 | 967 | 803 | 1,426 | 733 | 736 | 544 | 1,119 | 1,156 | 961 | |||||||||||||||||||||||||||||||||
| Diluted earnings per share attributable to Mondelēz International |
$ | 2.69 | $ | 2.47 | $ | 0.66 | $ | 0.55 | $ | 0.98 | $ | 0.50 | $ | 0.51 | $ | 0.38 | $ | 0.78 | $ | 0.80 | $ | 0.68 | ||||||||||||||||||||||
| Adjusted (Non-GAAP) - As Recast |
||||||||||||||||||||||||||||||||||||||||||||
| Equity method investment net earnings |
$ | 401 | $ | 438 | $ | 108 | $ | 95 | $ | 98 | $ | 100 | $ | 109 | $ | 113 | $ | 104 | $ | 112 | $ | 137 | ||||||||||||||||||||||
| Provision for income taxes |
850 | 892 | 199 | 206 | 166 | 279 | 198 | 126 | 285 | 283 | 252 | |||||||||||||||||||||||||||||||||
| Net earnings attributable to Mondelēz International |
3,528 | 3,734 | 930 | 812 | 917 | 869 | 958 | 881 | 930 | 965 | 1,137 | |||||||||||||||||||||||||||||||||
| Diluted earnings per share attributable to Mondelēz International |
$ | 2.42 | $ | 2.59 | $ | 0.64 | $ | 0.56 | $ | 0.63 | $ | 0.60 | $ | 0.66 | $ | 0.61 | $ | 0.64 | $ | 0.67 | $ | 0.80 | ||||||||||||||||||||||
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Financial Schedules
Exhibit 99.1 to this Form 8-K contains financial schedules that provide the reconciliations for our recast non-GAAP financial results for Adjusted EPS, due to the change in definition to exclude the initial impacts from all enacted tax law changes, for the first quarter of 2021, all quarters of 2020 and 2019 and years ended December 31, 2020 and 2019.
| • | Schedule 1 provides reconciliations of the differences between the recast Adjusted (non-GAAP) financial measures and their most directly comparable reported (GAAP) financial measures. Equity method investment net earnings and Provision for income taxes are components used to calculate net earnings and diluted earnings per share attributable to Mondelēz International. |
| • | Schedule 2 provides reconciliations between the reported diluted EPS attributable to Mondelēz International (GAAP) and the recast Adjusted EPS (non-GAAP) for comparative periods. |
Non-GAAP Financial Measures
We use non-GAAP financial information and believe it is useful to investors as it provides additional information to facilitate comparisons of historical operating results, identify trends in our underlying operating results, and provide additional insight and transparency on how we evaluate our business. For additional information regarding our non-GAAP financial measures, see Exhibit 99.2.
| Item 9.01. | Financial Statements and Exhibits. |
| (d) | The following exhibits are being furnished with this Current Report on Form 8-K. |
| 99.1 | Financial schedules – Unaudited GAAP and Non-GAAP Financial Information. | |
| 99.2 | Non-GAAP Financial Measures – Additional Information. | |
| 104 | The cover page from Mondelēz International, Inc.’s Current Report on Form 8-K, formatted in Inline XBRL (included as Exhibit 101). | |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| MONDELĒZ INTERNATIONAL, INC. | ||
| By: | /s/ Luca Zaramella | |
| Name: | Luca Zaramella | |
| Title: | Executive Vice President and Chief Financial Officer | |
Date: July 13, 2021
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