Cadbury sees good '08 profit despite slow US sales

[December 16, 2008]  LONDON (AP) -- Cadbury PLC, the world's biggest candy maker, said Tuesday it expects a strong rise in profits for 2008 despite seeing sales growth in North America slow in the fourth quarter.

The London-based candy maker also said it intends to sell off its Australian drinks unit, revealing that plans to spin off its last beverage business are already underway.

The maker of Green & Black's chocolate said in a trading statement that its markets in Britain, Ireland, the Middle East, Africa and the Asia Pacific region had continued to grow strongly through the year, helping to offset a slowdown in North America, where retailers are selling less candy and gum.

In North America, sales growth slowed to "mid single-digit" percentage growth in the fourth quarter of the year, down from "near double-digit" growth in the last four to five years, Chief Executive Todd Stitzer told journalists on a conference call.

However, the company said it still remains on target to meet revenue growth at the top end of its 4 percent to 6 percent target range this year, adding that it would achieve "strong profit growth" for the year despite weakening economic conditions in the fourth quarter.

Cadbury said its plan to separate its integrated beverage and confectionery business in Australia "is now well advanced." It provided no further details on potential suitors, saying it would update the market on any further developments in "due course."

Cadbury spokeswoman Alex Harrison declined to comment on a potential purchase price, but noted that analysts had valued the business at between 300 and 525 million pounds ($457 million to $800 million).

Cadbury had been considering the future of the Australian unit since -- as the former Cadbury Schweppes -- it divested its U.S. drinks operation, which has become Dr Pepper Snapple Group Inc., in May.

In a separate statement, the company said Andrew Bonfield would be taking over as chief financial officer when Ken Hanna retires in April to become chairman of car retailer Inchcape PLC.

Bonfield, 46, was most recently CFO of pharmaceutical company Bristol-Myers Squibb. He also served in the same position at SmithKline Beecham PLC before it merged with Glaxo Wellcome PLC and at BG Group PLC.

Cadbury's shares dipped 1 percent to 551 pence ($8.38) on the London Stock Exchange.

The company is scheduled to report its full-year results on Feb. 25.

[Associated Press; By EMILY FLYNN VENCAT]

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.