Mondelez International, Inc.MDLZ , a global snacking powerhouse, has plans to develop a global Research, Development & Quality or RDQ network at nine advantaged technical centers around the world.
Over the next two years, the company will spend $65 million to build advantaged technical centers that will enable it to better recruit, retain and develop talent across a range of science and technical disciplines as well as boost its presence in emerging and developed markets.
The centers will be located in Mexico City, Mexico; East Hanover, NJ; Bournville, UK; Reading, UK; Wroclaw, Poland; Thane, India; Suzhou, China; Jurong, Singapore; and Curitiba, Brazil.
The centers in East Hanover, Bournville and Reading are already operational. Mondelez's Singapore facility will initiate operations in November while the Thane center will begin in December. The Wroclaw building will open in 2017, while the remaining centers will become operational in 2018.
Global Presence & Focus on Innovation
Mondelez has brands covering five fast-growing snacks categories - biscuits, chocolate, gum and candy, powdered beverages and cheese & grocery.
The company is invigorating its brand portfolio through product innovation and extending its brands to newer geographies and platforms. Mondelez's advertisement spend is biased toward the high-margin Power Brands. The company is increasing investments in in-store execution and advertising to support the Power Brands and is funding innovation through cost savings from restructuring initiatives.
Mondelez has a strong emerging market presence. It generates around 80% of its revenues from outside the U.S. with around 40% coming from emerging markets including Brazil, China, India, Mexico, Russia and Southeast Asia. Food/beverage companies are increasingly investing in developing and emerging countries like India, China and Brazil which boast significant growth potential due to relatively low per-capita consumption.
Though sales have been slower, Mondelez has been focusing on expanding margins through cost savings and productivity improvement. The latest plan to develop nine advantaged technical centers around the globe is a classic example of it.
Mondelez carries a Zacks Rank #3 (Hold). Better-ranked stocks in the consumer staples sector include Omega Protein Corporation OME , Ingredion Incorporated INGR and The Kraft Heinz Company KHC . While Omega Protein sports a Zacks Rank #1 (Strong Buy), Ingredion and Kraft Heinz carry a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here .
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