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Cadbury loses egg share but de-merger on course
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11/04/2008
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At its annual meeting today (11 April), shareholders at confectionary group Cadbury Schweppes will vote to endorse the long heralded de-merger of its confectionery and beverages businesses and heard about the company’s progress over the first quarter.
The last day of dealings in Cadbury Schweppes shares will be on 1 May and on 2 May Cadbury plc will be listed on the London Stock Exchange. The beverages business, under the name Dr Pepper Snapple Group (DPSG) will be listed on the New York Stock Exchange from 7 May.
Over the three months to March, the company reported strong momentum in confectionery with revenue growth up seven per cent, with price increases being implemented to offset higher commodity costs.
Cadbury Schweppes CEO Todd Stitzer said the group had a strong start to the year in confectionery with revenues in the first quarter driven by excellent performances from its chewing gum and emerging market businesses and higher pricing to recover increased commodity costs. Beverages were performing in line with expectations with revenues benefiting from good growth in core non-carbonate brands.
He went on: "While the economic outlook in 2008 is challenging, we are encouraged by the performances of our confectionery and Americas Beverages businesses and the continued progress being made on their separate strategic agendas. We confirm the previous guidance given for both businesses and remain confident that they will generate enhanced returns for our shareowners as independent focused Groups."
In chocolate, Cadbury said it was pleased with Easter despite a much shorter selling season. However, a decision to limit participation in aggressive seasonal Easter discounting impacted market share.
In sweets, year-on-year market share performance continued to suffer from distribution losses resulting from the flooding of the company’s Sheffield factory last year.
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Author
Ken Hurst
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