Milling & Baking News - January 2, 2018 - 10

Business

Mondelez International putting
pieces in place for organic growth
NEW YORK - While Campbell Soup
Co. and the Hershey Co. unveiled
details of major acquisitions on Dec.
18, executives with Mondelez International, Inc. met with analysts to
discuss the Deerfield, Ill.-based company's future. According to a research
report from Credit Suisse, Mondelez's
new chief executive officer, Dirk Van
de Put, is putting the emphasis on
organic growth, a shift from the company's traditional focus on growth
through mergers and acquisitions.
During the meeting Mr. Van de Put
told analysts that Mondelez expects to
roll out a new three- to five-year strategic plan by September 2018, wrote
Robert Moskow, research analyst with
Credit Suisse, in the Dec. 18 report.
"He (Mr. Van de Put) fully supports
the 2018 guidance for 17% to 18% operating margin, but he believes that the
focus of the organization will need to
shift away from cost reduction and back
toward growth after that," Mr. Moskow
said. "Some will fear that this signals a
pre-disposition toward reinvestment

and lowering the margin target in 2019.
However, Van de Put says he comes
to the business with no pre-conceived
notions on that possibility. In addition,
he made a point to say
that he would rather see
whether the company
can spend its budget
smarter before agreeing
to plans to spend more."
An area of concern for Mr. Van de
Put is Mondelez's "long tail" of underperforming brands and categories,
specifically in chocolate and biscuits.
Mr. Moskow noted that while Mr. Van
de Put seemed willing to explore the
possibility of giving the underperforming brands and categories more
investment to succeed, the reality is
that new management tends to "lop
off long tails, not invest in them."
Mondelez's distribution program
was another area of discussion during
management's talk with analysts. Mr.
Moskow said Mr. Van de Put broached
the subject of whether the company will
stick with its direct-store distribution

Bartlett Grain reaches settlement in
2011 grain elevator explosion case
ATCHISON, KAS. - The U.S. Department of Labor announced on Dec. 20 that
the Occupational Safety and Health Administration (OSHA) and Bartlett Grain
Co. have agreed to settle the enforcement
case OSHA filed against the company as a
result of a dust explosion that occurred in
2011 at Bartlett's grain elevator in Atchison, killing six workers.
OSHA had proposed $406,000 in
penalties against Bartlett Grain, which
is based in Kansas City, and another
$67,500 in penalties against Kansas Grain
Inspection Services Inc., a contractor employed by Bartlett Grain. As part of the
settlement agreement, Bartlett Grain has
agreed to pay a penalty of $182,000 and
to withdraw its appeal of the two OSHA
citations filed five years ago.
The explosion, which occurred on Oct.
29, 2011, killed six men and injured two.
At the time of the explosion, the bins were
about two-thirds full of mostly corn. Workers were loading grain onto a train in that
area when the explosion occurred, according to the fire marshal. It blew the head
house off the top of the elevator and blasted
a hole in the side of the concrete structure.
In April 2012, OSHA cited Bartlett Grain
10 / January 2, 2018

Milling & Baking News

for five willful and eight serious safety
violations. The willful violations include
allowing grain dust to accumulate, using
compressed air to remove dust without
first shutting down ignition sources, jogging (repeatedly starting and stopping)
inside bucket elevators to free legs choked
by grain, using electrical equipment inappropriate for the working environment
and failing to require employees to use fall
protection when working from heights.
On Nov. 10, 2016, Tom Beall, acting
U.S. attorney for the District of Kansas,
released a statement saying there was not
sufficient evidence to support criminal
charges against Bartlett Grain Co.
The D.O.L. said Bartlett Grain has completed the abatement of several items in
the OSHA citations and has agreed to
perform additional abatement during the
three-year length of the corporate-wide
settlement agreement, including implementing additional safeguards, training
and audit procedures at its 20 grain handling facilities in six states.
"By agreeing to the terms of this settlement, Bartlett Grain Co. has made a commitment to invest in its employees and
work with OSHA to follow best practices

resources in North America or follow
Kellogg's lead and transition to a directto-warehouse strategy. Mr. Van de Put
indicated that D.S.D. can be a drain on
the cost side, and at the very least Mondelez needs to reroute its sales force to
adapt to the shift in channels to smaller
format stores and hard discounters.
Mondelez may have
a "dual portfolio" in
mind when it comes
to health and wellness,
Mr. Moskow said.
"Having come from a fast-growing
french fry company, he (Mr. Van de
Put) said he is very comfortable with
the indulgent snacks side of the business," Mr. Moskow wrote. "However,
he recognized the need for developing a strong presence in health and
wellness and the likelihood that the
current stable of brands (Oreos, Ritz,
Cadbury) did not have the credentials
to extend in that direction."
Overall, Mr. Moskow's takeaway
from the meeting was that Mondelez's
organization and board will embrace
Mr. Van de Put's management style,
describing the new c.e.o. as "unassuming, straightforward, friendly and
a good listener." MBN

and make significant changes at its facilities nationwide," said Kimberly Stille, a
regional administrator at OSHA. "OSHA
will ensure that Bartlett Grain implements
its commitment to improve safety for all of
its employees under this agreement."
The D.O.L. said the agreement requires
Bartlett to review its safety and health
management system and consult with industry experts to conduct a detailed audit
of the system's effectiveness. Bartlett also
will give its internal safety manager authority to stop unsafe operations; obtain a
qualified third-party to review new installations or material modifications to dust
filter collectors and grain stream processing equipment; update its housekeeping and preventative maintenance programs; enhance its training procedures;
and report to OSHA on a quarterly basis
throughout the term of the agreement.
The company has agreed to work with
OSHA, the Grain Elevator and Processing Society, and the National Grain and
Feed Association to educate employees
on hazards and share best practices for
employee training and education, the
D.O.L. said. In addition, Bartlett will supplement its annual employee grain training with outreach and training on grain
engulfment and rescue to first responders
and community members, including independent farmers. MBN
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Milling & Baking News - January 2, 2018

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