Newspaper article The Journal (Newcastle, England)

Cadbury Hits a Low as Ingredient Costs Keep Rising

Newspaper article The Journal (Newcastle, England)

Cadbury Hits a Low as Ingredient Costs Keep Rising

Article excerpt

COSTS stemming from the controversial acquisition of UK chocolate business Cadbury have led to foods giant Kraft posting a 24% drop in fourth quarter profits.

The cost of ingredients such as corn, sugar and cocoa also bit into results as the maker of Oreo cookies, Capri-Sun and Maxwell House coffee saw net income fall to pounds 335m in the final three months of 2010. Cadbury's revenues were flat in Europe as solid growth in the UK was offset by weaker gum and sweet sales in southern Europe. The Cadbury business fared less well in North America, where net revenues were down 6.1% due to lower sales of Trident and Stride gum and strong trading by Halls a year earlier.

Across the Kraft business, revenues increased by 30% to pounds 8.6bn and included a 26.2 percentage point contribution from Cadbury, which the company bought for pounds 11.5bn last February.

Cadbury's like-for-like revenues grew 2.2%, helped by demand in emerging markets.

Kraft's operating income for the quarter was impacted by a 26. …

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