Cadbury sees strong rise in sales

Cadbury's recently started using Joss Stone in its Flake adverts

Cadbury Schweppes has reported 7% growth in confectionery sales for the three months to March.

Chewing gum continued to be a big growth area for Bournville-based Cadbury, while price rises allowed it to offset rising commodity prices.

However, the firm said it had lost share in UK Easter chocolate sales after it resisted cutting prices.

The demerger of Cadbury's North American drinks business is expected to be approved at its AGM on Friday.

The North American beverages unit reported 3% growth in its revenues.

Cadbury Schweppes shares closed down 2.5% on concerns about its outlook for 2008 after the firm described the economic outlook for 2008 as "challenging".

Easter eggs

"Revenues in the first quarter [were] driven by excellent performances from our gum and emerging market businesses and higher pricing to recover increased commodity costs," said chief executive Todd Stitzer.

Cadbury Schweppes share price

In Britain, the company said it was pleased with its Easter sales, despite the shorter selling season caused by the early date of the holiday.

But Cadbury's conceded that its market share had fallen because it decided not to take part in "aggressive seasonal Easter discounting".

If, as expected, the demerger of the Americas Beverages business goes ahead, new Cadbury shares are expected to begin trading in London on 2 May, while shares in the drinks business, called DPSG, should start trading in New York on 7 May.

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