'Nightmare' before Christmas as Cadbury supplies run low

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The Independent Online

The FTSE 100 group updated IT systems at Cadbury Trebor Bassett earlier this year. A spokesman confirmed that problems had developed after this, adding: "We have had a system upgrade, and with any complex upgrade you experience some problems. But we're still despatching large volumes of confectionery."

He conceded that the festive season was a particularly busy time of year because of demand for chocolate Christmas tree decorations and other festive products, alongside everyday chocolates and sweets.

One unnamed wholesaler told the trade magazine The Grocer there had been "all sorts of problems", adding: "We have had a nightmare in terms of supply across all products."

But the Cadbury spokesman remained confident and said festive confectionery was already being distributed. "It's inevitable you will experience some issues but we believe our plans in place will resolve this."

Cadbury announced last week that it was selling its Paris-based European drinks arm, which owns Schweppes, Orangina and Oasis, to the private equity firms Blackstone and Lion Capital for €1.85bn (£1.3bn). The cash is expected to be used primarily to pay down its £4.3bn debt pile.

Once the deal completes - expected in early 2006 - around 66 per cent of Cadbury's sales will come from confectionery, though it will still own drinks businesses in North America and Australia. Analysts believe that proceeds from the sale could be used not only to tackle debt but for acquisitions in the confectionery sector. One of Cadbury's biggest recent deals was the acquisition of Adams, a US gum business, for $4.2bn (£2.5bn).

Earlier this year, Cadbury's chief executive, Todd Stitzer, reported sales of Easter eggs and everyday confectionery ranges as up 7 per cent, which helped take the company's share of the UK market to 31.1 per cent. Interim group pre-tax profits came in at £370m, a 6 per cent hike, while sales were £3.13bn.

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