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Last Updated: Wednesday, 23 February, 2005, 18:06 GMT
Cadbury boosted by upbeat outlook
Confectionery sales were strong in 2004
Shares in confectionery giant Cadbury Schweppes have risen after the company said it was confident it would hit its sales targets for 2005.

Cadbury's upbeat forecast came as it reported a 1% rise in underlying pre-tax profits to 933m ($1.78bn) for 2004, in line with expectations.

The profit rise would have been higher but for the weakness of the US dollar which weighed on earnings growth.

Cadbury owns brands such as Dairy Milk, Trebor, Dr Pepper and Snapple.

"While the external commercial environment remains competitive, we are confident that we have the strategy, brands and people to deliver within our goal ranges in 2005," said chief executive Todd Stitzer.

Cadbury said its underlying sales grew 4% in 2004, in line with its target of increasing sales by 3-5% annually.

Shares in Cadbury Schweppes topped the FTSE 100 leaders board at one point before slipping back. The shares remained one of the few risers on the London market, closing up 0.05% at 511.75p.

Snack success

The modest profit rise for 2004 had been expected by analysts after the company said in December that the poor summer weather had hit soft drink sales in Europe.

Cadbury - which generates about 80% of sales and profits outside the UK - also said profits had been hit by currency movements, "primarily" the US dollar which has been losing value in recent months.

Canada Dry
Dr Pepper

Sales growth was helped by its confectionery brands - including Cadbury, Trident and Halls - which enjoyed a "successful" year, with like-for-like sales up 6%.

Drinks sales were up 2% with strong growth in US carbonated soft drinks, led by Dr Pepper and diet drinks, offset by the weaker sales in Europe.

Cadbury said that its US drinks sales had done well in the US, helped by the fact that it was focussing on fruit and diet drinks rather than taking on cola giants Coca-Cola and Pepsi.

"We dance with elephants all the time but we have excellent brands in the US where we focus on diet and flavoured drinks and away from the cola area," Mr Stitzer told reporters.

Cadbury added that its Fuel for Growth cost-cutting programme had saved 75m in 2004, bringing total cost savings to 100m since the scheme began in mid-2003.

The programme is set to close 20% of the group's factories and shed 10% of the workforce.

Cadbury Schweppes employs more than 50,000 people worldwide, with about 7,000 in the UK.

Cold weather cools Cadbury sales
24 Sep 04 |  Business
Soft drinks fuel sales at Cadbury
21 Jul 04 |  Business
Cadbury says sales are on target
21 May 04 |  Business

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