Cadbury is the world's biggest confectionary firm

The world's largest confectionary firm, maker of Dairy Milk, Trident gum and Dr Pepper, said costs had risen in the second half due to higher oil prices.

"We are unlikely to make sufficient progress to be within our margin goal range this year," the company said.

However, it said revenue growth would be around the top end of forecasts.

At its first-half results announced in July, Cadbury was confident of hitting its annual sales and margin targets, but rising fuel costs and the impact of Hurricane Katrina have jeopardised profit margins in the second half.

The company employs over 50,000 people and has manufacturing operations in more than 35 countries.

Cadbury shares have risen just over 20% so far this year, valuing the group at about �12bn $21.23bn).