Financial Review

Americas confectionery

£ millions	2004 (52 weeks)	Base Business	Acquisitions/ Disposals	Exchange	2005
Revenue	1,090	111	-	27	1,228
- year-on year change		+10%	+0%	+3%	+13%
Underlying Profit from Operations	142	26	-	4	172
- year-on year change		+18%	+0%	+3%	+21%
Underlying Operating Margin	13.0%				14.0%

Americas Confectionery had another excellent year with revenues ahead by 10% and margins up by 100 basis points to 14.0%. Performance was balanced across all territories and was driven by our 5 power brands in the region, Trident, Dentyne, Halls, Cadbury and the Bubbas, which account for almost 70% of sales. Growth was particularly strong in Trident up 22%, where we had major innovation initiatives during the year including the launch of Trident Splash in the US and Canada.

In North America, revenue growth in the US of 11% was led by gum. A strong innovation pipeline, including the launch of Trident Splash and Dentyne soft chew drove healthy market share gains particularly in the second half. We gained 80 basis points of gum share during the year with the latest four week period over 300 basis points up at 30%. In Canada, branded revenues rose by 8% and total revenues by 4% reflecting a focus on a smaller range of profitable brands. This focus on more profitable growth led to over 150 bps increase in margins in Canada.

In emerging markets, revenues grew by 13% with double-digit growth in all territories, including Mexico up 10% and Brazil up 15%.

Strong margin performance was due to the combination of revenue growth, focus on profitable growth in Canada and the successful execution of key Fuel for Growth projects including the consolidation of production in Brazil and the transfer of Halls production from Manchester into Canada and Colombia.