Cadbury-Schweppes records 26% sales increase for H1 - Brief Article - Statistical Data Included

Eurofood, August 2, 2001

Cadburys-Schweppes (CS) noted good overall performance in their interim results last month, with a 26% increase in sales figures, 2% increase in volume and a 4% increase in revenue.

The company was confident that its good performance in the first half of the year had put it on track to meet its double-digit earnings growth for 2001.

Mott, European beverages, French confectionery and emerging markets were said to have recorded strong sales, whilst Dr Pepper/Seven Up and Cadbury Trebor Bassett were said to be responding well to the challenges of the slow market conditions.

Acquisitions are a key part of its growth strategy, with ten new brands and businesses acquired in the last year. The most recent of these being Orangina in France and La Casera in Spain, both of which are set to double CS's market share in those countries.

Despite a total market decline in the UK confectionery Cadbury Trebor Bassett described itself as giving a `creditable performance'.

Plans to support Team England in the Commonwealth Games next year were seen as very positive and the London Underground contract was described as a `huge win' over some strong competition.

Despite all this analysts are concerned about sales volumes. "If you strip out acquisitions and price increases, you're probably looking at a (sales growth) number of less than one percent", one analyst said.

Peers such as Danone and Nestle are said to be growing at around 3% to 4%. In its defence, Cadbury's would argue that acquisitions and restructuring had meant that there had been some `near term impact' but that `integration programmes were all on track'

BETTER OFF IN CURRENT MARKET

When questioned about its acquisition strategy CS replied that it felt it was better off in the current market climate than companies that had chosen to focus on a few big name brands. It was thought that the lack of a cola brand had enabled them to concentrate on other brands including non-carbonated drinks that were giving good results.