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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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
= – × =
The financial data reveals several notable trends for the company over the five-year period from the end of 2020 through 2024.
- Net Operating Profit After Taxes (NOPAT)
- NOPAT experienced fluctuations during the period. It increased from $3,858 million in 2020 to $4,733 million in 2021, indicating a strong performance in that year. However, there was a significant decline in 2022, with NOPAT dropping to $3,016 million. The company then rebounded robustly in 2023 to $5,433 million, reaching the highest value in the dataset, before a slight decrease to $5,271 million in 2024. Overall, despite the dip in 2022, the trend suggests resilience and recovery with a strong finish by 2024.
- Cost of Capital
- The cost of capital showed a steady upward trend from 8.44% in 2020 to a peak of 9.05% in 2023, followed by a modest decrease to 8.8% in 2024. This indicates rising financing costs over most of the period, which could reflect changes in the market environment or risk perception, before slightly easing in the last year.
- Invested Capital
- Invested capital exhibited a relatively stable trend with minor fluctuations. It rose gradually from $61,366 million in 2020 to a peak of $63,833 million in 2022. Afterward, it decreased to $61,495 million in 2023 and further to $60,269 million in 2024. This suggests some divestment or asset lightening towards the latter years, potentially aimed at optimizing capital allocation.
- Economic Profit
- Economic profit remained negative throughout the period, indicating returns below the company’s cost of capital. The negative economic profit narrowed from -$1,322 million in 2020 to -$621 million in 2021, showing improvement. However, it deteriorated sharply to -$2,562 million in 2022, a reflection of pressured profitability relative to invested capital and cost of capital. Following this, economic profit recovered significantly to -$131 million in 2023 and further improved to -$30 million in 2024, approaching breakeven. This pattern reflects that although the company struggled to generate returns above its cost of capital for most years, it made substantial progress towards enhanced value creation in the last two years.
In summary, the company experienced volatility in operational profitability and cost of capital, with 2022 being a year of diminished performance. However, strong recovery in NOPAT and economic profit in 2023 and 2024 indicates improving efficiency and value generation despite relatively high capital costs. The gradual decline in invested capital suggests a possible strategic shift towards more efficient use of assets.
Net Operating Profit after Taxes (NOPAT)
Mondelēz International Inc., NOPAT calculation
US$ 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.
The financial data exhibits several notable trends over the five-year period from 2020 to 2024.
- Economic Profit
- The economic profit shows a consistent negative value throughout the period, indicating the company has not generated value over its cost of capital. A significant decline in economic losses is visible between 2020 and 2021, with economic profit improving from -1322 million US dollars to -621 million US dollars. However, in 2022, the economic profit sharply worsens to -2562 million US dollars, representing the lowest point in the period analyzed. Subsequent years show a recovery trend, with losses decreasing substantially to -131 million US dollars in 2023, and further improving to -30 million US dollars in 2024, suggesting a move towards breakeven on economic profit.
- Invested Capital
- The invested capital remained relatively stable around 61 to 63 billion US dollars over the period. It started at 61366 million US dollars in 2020, increased slightly in 2021 and 2022 to reach a peak of 63833 million US dollars, and then gradually decreased in 2023 and 2024 to 61495 and 60269 million US dollars respectively. This slight reduction in invested capital in the later years could imply strategic capital management or divestitures to optimize the asset base.
- Economic Spread Ratio
- The economic spread ratio, which measures the difference between the return on invested capital and the cost of capital, remained negative throughout the period. It improved from -2.15% in 2020 to -1.01% in 2021, showing better efficiency in capital usage. However, there was a considerable deterioration in 2022 to -4.01%, corresponding to the steep decline observed in economic profit. The ratio then improved markedly over the next two years to -0.21% in 2023 and -0.05% in 2024, indicating the company was close to covering its cost of capital by the end of the period.
Overall, the data suggests that the company experienced significant challenges in 2022, reflected in its economic profit and economic spread ratio turning sharply negative. However, the trend from 2023 to 2024 shows substantial improvement, signaling efforts towards recovering value creation and enhanced capital efficiency. The stability in invested capital indicates a consistent asset base, with modest reductions towards the latest years possibly aimed at improving returns.
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.
The financial performance over the five-year period shows distinct trends in revenue generation and economic profitability. Net revenues have exhibited consistent growth from 26,581 million US dollars in 2020 to 36,441 million US dollars in 2024, indicating a strong upward trajectory in sales or other revenue streams. This increase suggests successful operations or market expansion activities.
Despite the increase in net revenues, the economic profit figures reveal persistent negative values, though showing improvement in the later years. The economic loss was highest in 2022 at -2,562 million US dollars but improved significantly by 2024 to a marginal negative of -30 million US dollars. This progression signals efforts to reduce costs, optimize operations, or achieve better capital efficiency, although the company remains economically unprofitable.
In parallel, the economic profit margin reflects a similar pattern. It was notably negative at -8.13% in 2022, indicating substantial value destruction relative to revenues. However, by 2023 and 2024, the margin approached closer to zero (-0.36% and -0.08% respectively), suggesting a trend toward economic breakeven or possibly future profitability if the improvements continue. The margin has consistently remained negative throughout, implying that return on invested capital has not yet exceeded cost of capital.
- Net Revenues
- Increased steadily from 26,581 to 36,441 million US dollars from 2020 to 2024, demonstrating robust revenue growth.
- Economic Profit
- Remained negative across the period, peaking negatively in 2022 but improving significantly by 2024, indicating an improving but still challenged profitability position.
- Economic Profit Margin
- Remained negative throughout but improved notably after 2022, moving closer to zero by 2024, reflecting a reduction in value loss relative to revenue.
Overall, the data depicts strengthening top-line performance accompanied by gradual enhancements in economic profitability metrics, though the company has not yet achieved positive economic profit or margin within the period analyzed.