Cadbury admits 5% sales dip after health scare

CadburyCadbury has admitted that sales are performing worse than expected, as the chocolate giant continues to struggle to recover from the salmonella debacle this summer.

Overall sales are 5% down on last year, with the company blaming unseasonably warm temperatures. However it claims it has been gaining market share from rivals.

Cadbury had to recall 1 million Dairy Milk bars in June over fears they had been contaminated with salmonella. At the time it hit launch plans for Cadbury Melts and severely dented consumer confidence in the brand.

The company claimed today that consumer confidence in the Cadbury brand is recovering well in the run-up to the important Christmas season, but admitted that public perception of the brand had still not returned to pre-recall levels.

It says that Cadbury Melts and Flake Dark had both been performing strongly since their launches. But its home market of the UK is still one of the worst performing markets for the company.

While revenue growth for parent company Cadbury Schweppes across the rest of the world is expected to be at the top end of its goal range this year, problems in the UK are likely to drag down its overall results. The company admitted that "given weaker trading in our high margin UK and Nigerian businesses, it is unlikely that we will see progression in underlying group margins for the year as a whole".

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