Cadbury upbeat despite profits fall

Confectionery group Cadbury Schweppes today unveiled a 32% fall in pre-tax profits to £564m (€835m), but said it had seen an encouraging start to 2004.

The company behind Dairy Milk and Dr Pepper said its performance in 2003 had been resilient in a "transitional year", with difficult trading conditions in many of the firm's markets.

While underlying group operating profits advanced by 7% to £1.052bn (€1.558bn), underlying pre-tax profits dropped by 1% to £922m (€1.366bn).

The group added that above-inflation rises in cocoa, pension and insurance costs would "temper" strong underlying profit progress during the coming year.

But it said its performance broadly improved in the final quarter of 2003 and the integration of the Adams gum and medicated sweet business and the company's Fuel For Growth drive, which aims to cut up to £400m (€592m) in costs from the business, were progressing according to plan.

Chief executive Todd Stitzer said: "The outlook for 2004 is encouraging, with our main businesses performing well."