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Cadbury's $700m sale hope

Nigel Cope Associate City Editor
Wednesday 28 July 1999 23:02 BST
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CADBURY SCHWEPPES hopes to receive an initial cash payment of $700m within the next month from the sale of its non-United States drinks businesses to Coca-Cola, the group said yesterday.

Cadbury, whose deal with Coca-Cola has been hit by a series of regulatory problems, also expects to complete further sales in Australia, Canada, South Africa and Mexico, though some may not be finalised until next year.

John Sunderland, chief executive, declined to comment on his plans for the cash though he hinted that confectionery deals in Europe could be high on the agenda.

"But there is no major acquisition imminent," he said.

The comments came as Cadbury Schweppes reported a 7 per cent rise in half year profits to pounds 277m, though reorganisation costs meant pre-tax profits fell by 6 per cent to pounds 252m.

Cadbury's Dr Pepper soft-drinks brand outperformed the market with volumes up by 5 per cent in the first half.

But Seven-Up was again hit by aggressive promotion by Coca-Cola of its Sprite brand which pushed Seven-Up sales down by 3 per cent.

The Coca-Cola giant staged a major July promotion in southern California, Dr Pepper's biggest market, which effectively blocked the Cadbury brand from retailers' shelves.

In confectionery good performances in the UK and Australia were overshadowed by the impact of the Russian crisis and the German business falling into loss.

The shares fell 10p to 41.75p.

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