Cadbury Schweppes, the world's biggest confectioner, met forecasts today with a one per cent rise in profits, but warned it would be challenging for strong US fizzy drinks growth to continue into 2005.
The maker of Dr Pepper and 7-UP said its US carbonates division grew sales five per cent in 2004 as it focused on diet and fruity drinks and away from the cola-dominated world of industry leaders Coca-Cola and PepsiCo.
But Cadbury's shares rose after the results with confirmation that the group will hit its sales and profit margin targets again in 2005. They were the top riser in the FTSE-100 index, up 2.2 per cent at 522 pence by early this morning.
Chief Executive Mr Todd Stitzer said the group had an excellent year in US fizzy drinks in 2004 but planned for a more normal sales rise of around 3 per cent in 2005, as Coca-Cola fights back with a big rise in its marketing spend.
"We dance with elephants all the time but we have excellent brands in the US where we focus on diet and flavoured drinks and away from the cola area," he told a conference call.
Cadbury, which bought US sweet maker Adams in 2003, still earns almost 40 per cent of its profits from its North American soft drinks division which also makes non-fizzy drinks such as Snapple and Motts.
The group which also makes Dairy Milk chocolate, Trident sugar-free gum and Halls cough sweets posted underlying pre-tax profits of £933 million.