Page last updated at 18:48 GMT, Wednesday, 21 October 2009 19:48 UK

Strong sales rise boosts Cadbury

A Cadbury Diary Milk
Cadbury produces some of the UK's best-known chocolate bars

UK confectioner Cadbury has reported higher-than expected sales for the third quarter of the year, raising pressure on would-be US suitor Kraft.

It also raised its forecast for revenue this year to "around the middle" of its previous guidance of 4-6% growth.

Last month, Cadbury rejected a takeover approach from Kraft, which had valued the company at £10.2bn ($16.3bn).

The UK's Takeover Panel has given Kraft until 9 November to make a formal offer.

The confectioner's shares rose 0.1% to 799 pence in Wednesday trading in London.

Kraft's original approach was worth 745p per Cadbury share.

'Great momentum'

Cadbury said sales rose 7% in the quarter from the prior year, excluding the impact of currency fluctuations.

Analysts had been expected growth of about 4%.

Sales in the UK and the Republic of Ireland rose by 10%, while candy and gum sales increased due to higher demand in North America and continental Europe.

"We have great momentum in our business and our confectionery strategy continues to yield benefits beyond expectations," said Cadbury chief executive Todd Stitzer.

Cadbury has said that the original Kraft offer "fundamentally undervalued" the firm and that it would prefer to remain independent.

The increase in Cadbury's share price has raised speculation that Kraft will come back with a higher offer.

If it does not make an offer, Kraft will be blocked from making a bid for Cadbury for six months.

As well as Dairy Milk, Cadbury also owns the Green & Black's chocolate brand, Halls lozenges, Trident and Dentyne gum brands and liquorice allsorts maker Bassett's. It spun off its drinks division as a separate business last year.

Kraft's brands include Kenco and Maxwell House coffee, Oreo biscuits, Jacobs, Terry's Chocolate Orange and Toblerone, as well as cheese products such as Philadelphia and Dairylea.

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