Cadbury sees chocolate eating rising in recession

Bars of Wispa chocolate are seen at Cadbury World in Birmingham, October 7, 2008. Picture taken October 7, 2008.

LONDON (Reuters) - Chocolate eating is on the rise in the current economic slowdown, while chewing gum is suffering, according to British confectionery giant Cadbury CBRY.L.

Chief Executive Todd Stitzer said consumers were tucking into more chocolate at home in the recession, while chewing gum, which tends to sell in convenience stores, petrol stations and airport shops, had been hit as people travelled less.

"Chocolate benefits as people stay at home, but gum has suffered. Chocolate sales are holding up well as people buy multi-packs, stock up the larder, and stay at home," he said after a 2008 results news conference.

Cadbury, the world's second-largest confectionery group, behind newly merged global leader Mars-Wrigley, sells chocolate and also chewing gum brands such as Trident, and has seen overall global confectionery growth starting to slow over the last six months.

The London-based group said its worldwide global chocolate sales were up 6 percent in 2008, with its flagship Dairy Milk brand 11 percent up in the full year after a 9 percent rise in the first-half.

Stitzer said the group had seen a particularly strong second half of 2008 in Britain, helped by the re-launch of its Wispa bar and its new Creme Egg Twisted product.

This helped push the group's British chocolate market share up by 0.5 percentage points to nearly 30 percent, almost back to the level seen before a salmonella-linked product recall in 2006 sent Cadbury's market share down.

This compares with other major players in the market such as the privately owned U.S. group Mars on 25 percent and Swiss-based Nestle (NESN.VX) on 16 percent.

Earlier, Cadbury reported a 30 percent rise in 2008 pretax profits, with underlying sales up 7 percent, and gave a relatively upbeat outlook for 2009, seeing sales towards the bottom of its 4 to 6 percent medium-term growth target.

(Reporting by David Jones, editing by Will Waterman)