Cadbury has piled the pressure on Kraft to come up with a larger bid after revealing better than expected results during its third quarter.
The company reported a 7% sales increase between July and September, while its UK business grew by 10%. Cadbury’s UK chocolate arm was driven by the launch of Wispa Gold and early demand for seasonal products.
Its candy and gum businesses benefited from the launch of Trebor mint gum and heavy marketing activity for Maynards.
“We have great momentum in our business and our confectionery strategy continues to yield benefits beyond expectations,” said Cadbury chief executive Todd Stitzer.
“In the third quarter we have delivered growth in every category and every business. At the same time, we have maintained our investments in innovation and marketing to reinforce our commitment to delivering future growth." He added that company had increased its margin growth and sales targets for this year.
In a note to investors, Cazenove called the results "better than the more cautious commentators’ expectations".
"As expected, Cadbury is using this positive trading statement as part of its defence against the Kraft bid," the investment bank said.
"We are not surprised that Kraft has waited to see Cadbury’s Q3 trading announcement before it puts forward a firm offer. Further, we believe Kraft could use its own Q3 results announcement [due on 3 November] to reiterate its investment case in Kraft and the strategic rationale behind its proposal to acquire Cadbury."
Cadbury’s Bond: ‘We can see off Kraft bid’ (12/10/09)
Path clear for Kraft with no new Cadbury bids (6/10/09)
Kraft told to put up or shut up (30/9/09)
Can Cadbury fight off its US suitor following its impressive third-quarter performance? Or is the confectioner now a more attractive target than ever? Click 'Post a comment' to have your say.