delivering against our plancadburyar2008.production.investis.com/~/media/files/c/...FC2 Cadbury...

CadburyShareholderMagazine2008/09FC1

performancefocused

on

CadburyShareholderMagazine2008/09

deliveringagainstourplan

FC2 CadburyShareholderMagazine2008/09

welcometoIssue1ofournewShareholderMagazine,Treat.ComeandgetarealtasteofCadbury–whoweare,whywearedifferentandwhatwearedoingtoachieveourvisionofbeingthebiggestandthebestconfectionerygroupintheworld.Thisissuefocusesonour2008achievementsandourprioritiesfor2009.

inside:1 Chairman’sintroduction2 2008highlights3 DiscussionwiththeChairman

andChiefExecutive4 ChiefExecutive’scomment7 -Performancescorecard8 -Prioritiesfor200910 OurVisionintoAction12 Ourbusinessunits14 Ourthreecategories:

chocolate,gumandcandy20 Financialstatements24 Oursustainabilitycommitments26 BoardofDirectorsand

GroupSecretary27 Directors’remunerationreport

–highlights30 Shareholderinformation32 NoticeofAnnualGeneralMeetingIBCOtherinformation

Formoredetailedinformation,goonlineatwww.cadbury.comorcontactCadburyGroupSecretariatatourRegisteredOffice.

AllconfectionerymarketinformationinthisreportissourcedfromEuromonitorunlessotherwisespecified.

CadburyShareholderMagazine2008/09 1

Chairman’sintroduction

challengesenergised

ahead

bythe

TheGroup’stradingperformancewasstrong,withasignificantimprovementinoperatingmarginandanincreaseinconfectioneryrevenuesof15%to£5.4bn.Excludingthebenefitofforeignexchange,basebusinessrevenuegrowthwas7%,representingorganicgrowthabovethetopendofour4%–6%goalrange.

Throughouttheyear,wetookeffectivemeasurestoprotectandexpandourprofitmargins.Weincreasedourpricestooffsettheriseininputcostsandstreamlinedourcostbase,mainlythroughreductionsinsales,generalandadministrationcostsandincentraloverheads.Asaresult,combinedwiththegoodrevenuegrowth,wesignificantlyincreasedourprofits.Ourunderlyingoperatingmarginincreasedfrom10.1%in2007to11.9%in2008.Excludingthegainfromforeignexchange,theimprovementinmarginwas150bps.

IbelievethisisastrongperformanceandshowsgoodprogressonourfouryearVisionintoAction(VIA)strategicplanwhichincludesachievingmid-teensmarginsby2011.Despiteourownchangeprogrammesandtheunprecedentedturmoilinfinancialmarkets,ourteamsaroundtheworldworkeddiligentlytoimplementourbusinessplan.Iwouldliketothankallofthemfortheircommitment,enthusiasmandfocusonthejobathandandformaking2008asuccessfulyearforCadbury.

DividendsTheBoardisproposingafinaldividendof11.1p,bringingthetotaldividendfortheyearto16.4p,anincreaseof6%on2007.Whiletheincreaseisinlinewithourprogressivedividendpolicy,thepay-outratioissomewhataheadofourmedium-termtargetof40–50%.

Looking forwardToday,allcompaniesarefacingthemostuncertainglobaleconomicoutlookwehaveseenformanyyears.Consumerspendingisunderpressure,unemploymentisincreasingandtherateofgrowthisslowinginemergingmarkets.ForCadburytherearetheadditionalissuesofhighcocoapricesandthechallengesofincreasedcompetitorconcentration.

Ontheotherhand,thebusinessmodelwehavecreatedhasanenviableglobalfootprint,powerfulandrespectedbrands,talentedandpassionatemanagementandahistoryofresilienceineconomicdownturns.Wealsohaveastrongbalancesheetandsecurefinancing.Ibelieveourpeopleareenergisedbythechallengesaheadandcomfortedbythefactthatourstrategyisclearlydefinedandwidelyunderstood.Asaresult,whiletradingconditionswillnotbeeasy,weareconfidentthat2009willbeanotheryearofprogressforCadburyplc.

The Group delivered a strong performance in 2008. We met or exceeded our financial targets during a period of economic slowdown and financial turmoil while at the same time implementing important changes to the structure of the Group and the confectionery business.

Roger Carr Chairman

2 CadburyShareholderMagazine2008/09

Highlights2008

Reported Constant Re-presented currency currency2£millions 2008 2007 growth% growth%Revenue 5,384 4,699 +15 +6–UnderlyingProfitfromOperations1 638 473 +35 +22–Restructuring&othernon-underlyingitems (250) (195) Profit from operations 388 278 UnderlyingProfitbeforeTax1 559 430 +30 +17Profit before tax 400 254 Discontinuedoperations (4) 258 UnderlyingEPScontinuingOps1 24.9p 14.7p Reported EPS continuing Ops 22.8p 7.0p Reported EPS continuing Ops & discontinued Ops 22.6p 19.4p ProformaEPS–continuingOps3 29.8p 23.0p +30 +16Dividend per share 16.4p 15.5p +6

1 Cadburyplcbelievesthatunderlyingprofitfromoperations,underlyingprofitbeforetaxandunderlyingearningspershareprovideadditionalinformationonunderlyingtrendstoshareholders.ThetermunderlyingisnotadefinedtermunderIFRS,andmaynotbecomparablewithsimilarlytitledprofitmeasurementsreportedbyothercompanies.Itisnotintendedtobeasubstitutefor,orsuperiorto,IFRSmeasurementsofprofit.Afullreconciliationbetweenunderlyingandreportedmeasuresisincludedinthesegmentalreportingandreconciliationofunderlyingmeasuresnote.2Constantcurrencygrowthexcludestheimpactofexchangeratemovementsduringtheperiod.3AsaresultoftheSchemeofArrangementtoreplaceCadburySchweppesplcwithCadburyplcasthenewholdingcompanyoftheGroupandthesubsequentdemergerofAmericasBeverages,thesharesoftheGroupwererestructuredwith100CadburySchweppesplcsharesexchangedfor64Cadburyplcordinarysharesand12commonstockinDPSG.ProformaEPScalculatesunderlyingearningspershareofthecontinuingGroupwithreferencetotheunderlyingnetprofitfromcontinuingoperationsof£403m(2007–£309m)andassumesthattheshareconsolidationwasinplacefortheentireperiodinboth2007and2008resultingintheproformaweightedaveragenumberofsharesusedtocalculateproformaEPSof1,347m(2007–1,336m).

7%Revenuegrowth†

11.9%Operatingmargin*

16%EPSgrowth**

6%Dividendgrowth

Financial highlights:>Basebusinessrevenuesup7%>Underlyingmarginsup150bps>ProformaEPSfromcontinuingoperationsup16%>Returnoninvestedcapitalup110bps>Full-yeardividend16.4p,up6%

Strategic highlights:>Transformationofthebusinessintoacategory-ledpure-playconfectionerycompany>VisionintoActionbusinessplanwellunderway>Simplifiedorganisationfrom2009

† Basebusinessrevenue* Underlyingoperatingmarginatreportedcurrency**ProformaEPSfromcontinuingoperations(exceptwherestated,allmovementsuseconstantcurrency)


RogerCarr,ourChairman,andToddStitzer,ourChiefExecutive,sharetheirthoughtsonthenotableachievementsin2008andthechallengesaheadin2009.

What has given you the most satisfaction in Cadbury’s achievements in 2008?

Roger:Asyoucanseefromourfinancialresults,theperformanceoftheCompanyhasbeenstrong.Managementhavemetalloftheirgoalsinrevenue,profitandmargingrowthinwhat,byanymeasure,hasbeenachallengingperiod.However,whilethefinancialachievementsintheyearhavebeenpleasing,forme,ithasbeenthetighteningofoperationalmanagementandthestepchangeinbusinesspaceunderTodd’sleadershipthathavebeenthemostencouragingfeatures.Thisliftinbothtempoandresolvehasserveduswellin2008andspeakspositivelyforthefutureprospectsofthebusiness.

Todd:WithcriticalinitiativessuchasthesuccessfuldemergerofourAmericasBeveragesbusinessandtheimplementationofourVisionintoActionbusinessplan,2008hasbeenoneofthebusiestperiodsinthehistoryofCadbury.Ihavebeenincrediblyimpressedbythecommitmentandenergyshownbyourteamsworldwideastheyhaverisentothechallenge.Ourresultsthisyearareaclearreflectionoftheteam’squalityanddedication.

You are now 18 months into the implementation of your business plan – how is it going?

Todd:Wehavestartedwell,delivering150bpsmargingainfromtheplanin2008,andweexpecttobenefitfurtherfromourcostsavinginitiativesin2009.Inaddition,wearealsomakinggoodprogressonthemorecomplexreconfigurationprojectsthatwillbenefitusprogressivelymorein2010and2011.Weareinvestingaconsiderableamountofourshareholders’fundsinimprovingtheperformanceofourconfectionerybusinesses.Asaresult,wearecommittedtoensuringtheprogrammeiswell-managedanddeliversourfullexpectations.

What do you feel will be the biggest challenge for Cadbury in 2009?

Roger:2009isanimportantyearfortheCompanywithmajorplantreconfiguration,producttransfers

DiscussionwiththeChairmanandChiefExecutive

andrestructuringthatwillrequirededicatedmanagementefforttoeffectseamlesschange.

Clearlyeconomicconditionsremainturbulentandmarketscompetitive.Whilesomecommoditieshavesoftened,thepriceofcocoahasremainedpersistentlyhigh.

Likeallbusinesses,therefore,wearenotwithoutchallenge.Unlikemanybusinesseshowever,webenefitfromaresilientproductrange,anenviableglobalfootprintwithbroademergingmarketpresence,ahealthybalancesheetandaclearstrategy.

How are you tackling these challenges?

Todd:Inthisenvironment,ourconsumersandretailpartnerswillbedemandingmorefromCadbury–whetheritisintheformofinnovation,productqualityorevenhigherservicelevels.Ibelievewehaveastrongandcapableteamwhowillrisetothesechallengesandraiseourgamewhereneeded.

Atthesametime,we’recommittedtodeliveringthebenefitsofourstrategy,deliveringrevenuegrowthandpushingmarginshigher.Wehavethefocusaswellastheplansandactionsinplacetohelpusachievethesegoalsand,withsustaineddedicationfromtheteam,Iamconfidentwewillsucceed.

A final word for shareholders?

Roger:Intheyearahead,wewillcontinuetobuildonourstrengths,aggressivelymanagecosts,sustainourinvestmentinmarketingandsharpenourcompetitiveedge.Irrespectiveofeconomicconditions,deliveryofbothourperformancecommitmentsandshareholdervaluewillremainatthetopofouragenda.

Todd:Wehaveacommittedandexperiencedteamwhoarefocusedondeliveringourperformancetargets.WehaveagreatopportunitytomakeCadburythebiggestandbestconfectionerybusinessintheworldandweplanontakingit.

ExtendedinterviewswithourChairmanandChiefExecutiveareavailableonlineatwww.cadbury.comtogetherwithabriefoverviewofourresultsfromToddandtheusualinvestorpresentationsmadeinFebruary.

focusedperformance

on

deliveringagainstourplan

2008 was a year of significant development for Cadbury. We transformed our business, evolved our organisation model and started to implement major restructuring and reconfiguration.Iamverypleasedthatduringthiseventfulperiod,ourpeoplemaintainedtheirfocusonperformanceanddeliveredagainstourstrategicplan.

Todd StitzerChiefExecutive



IntroducedinJune2007,ourVisionintoAction(VIA)businessplansetsoutaboldagendawiththeclearvisionofbecomingtheworld’sbiggestandbestconfectionerycompany.Thisaspiration,builtarounddevelopingastrongtotalconfectionerymodel,issupportedbyclearobjectives,prioritiesandafinancialperformancescorecard.Thestrategyisunderpinnedbyastrongfocusonsustainability,cultureandpurposethatunifiestheactionsandobjectivesofthe45,000peoplewhoworkforCadbury.

Thegoverningobjectiveofourplanistoachievesuperiorshareholderreturns,throughdeliveringourperformancescorecard.

Wearenow18monthsintoimplementingourVIA.AlotofprogresshasalreadybeenmadeandI’llsharewithyousomeofthemajordevelopments.

ThethreeimportantprioritiesforCadbury,setoutintheVIAbusinessplanarebelow,togetherwithourperformancescorecard.Typicallyspanninganumberofyears,theserepresenttheimportantmilestonesagainstwhichthesuccessfuldeliveryofourstrategywillbemeasured.Adetailedexplanationofthemeasuresisincludedlater.

Strong financial performance2008hasbeenayearofstrongfinancialperformanceforCadburyasastandaloneconfectionerybusiness.Inbrief,wehaveexceededourrevenuegrowthtargets,improvedourglobalmarketshare,deliveredstrongmarginprogress,increasedourdividendandmadeahealthyincreaseinouroverallreturnoninvestedcapital.Wehaveputlong-termfinancinginplaceandstrengthenedourbalancesheet.Underpinningthesecommercialandfinancialgoals,wehavemadegoodprogressonoursustainabilitycommitments.

performance2008

our

in

2.Efficiency ‘Relentlessfocusoncost &efficiency’

ourpriorities

3.Capabilities ‘Ensureworld-classquality’

1. Growth ‘Fewer,Faster,Bigger,Better’

>Achieved8%revenuegrowthinfocusbrands>Rationalisedunderperformingproductsand‘tailbrands’>DroveconsumerpreferredbrandssuchasWispa>GainedscaleinTurkishroute-to-marketbycombininggumandcandydistribution

>RealisedSG&Acostsavings,improvingoperatingmarginby100bps>Reducedcentralcosts,improvingoperatingmarginby20bps>ReconfigurationofthesupplychainintheUKandIreland>Continuedtheturnaroundofunderperformingbusinesses>Divestednon-coreassetssuchasMonkhillcandy

>Strengthenedthecommercialcapabilitiesofourglobalcategoryteams>InvestedinScienceandTechnologytosupportinnovationandquality>Removedorganisationalcomplexitytospeedupdecisionmakingandinmarketexecution>Maintainedinvestmentsinfindinganddevelopingkeytalent

Priority 2008 activities


Reflectingtheseoperationaldevelopments,andwiththeestablishedstrategicprogrammefirmlyembeddedinthebusinessunits,wehavetakenthedecisiontoremovetheregionallevelfrom2009onwardsanddirectlymanagethesevenunderlyingbusinessunitsandthestrongglobalfunctionalleadership.

Westartedonthisjourneyin2003tocreateamorecentralisedorganisationwhichisjoined-upandunifiedwhilepreservingthelocalentrepreneurialspiritofourmanagers.Istronglybelievethatwehavemadegoodprogresstowardsthisgoalandthatthisnewstructurewillhelpusdrivecostefficiencies,fasterdecisionmakingandbetterin-marketexecution.

Implementing our Vision into ActionOurVIAsetsoutaclearstrategicprogrammeofactionandchangeforCadbury.Weareinvesting£450milliononrestructuringandsome£200millionofincrementalcapitalexpenditureoverthefouryearprogrammetomakesignificantchangestoourorganisation.

Theresultsoftheseinitiativesin2008havealreadybeensignificant,contributingtoastrongtoplineperformanceandamajorimprovementinourunderlyingoperatingmargins.

Year of significant changeAsourChairmanpointedoutinhisopeningremarks,2008hasalsobeenayearofsignificantchangeforCadbury,intermsofourportfolioofactivitiesaswellasimplementingthefirststagesofourVIAstrategy.

WhenwecompletedthedemergerofourAmericasBeveragesbusinessinMay2008,toformtheDrPepperSnappleGroup(listedontheNYSEinNewYork,Symbol:DPS),wehadlargelycompletedthetransformationfromCadburySchweppesplctoCadburyplc.

Completing the transformationTocompletethetransformationtoapure-playconfectionerybusiness,weannouncedaconditionalagreementtosellourAustraliaBeveragesbusinessattheendof2008.Thisisthelastofourbeverageactivitiesandwehopetocompletethesaleprocessduringthesecondquarterof2009.

Evolving our organisationThisyear,wehavealsotakentheopportunitytosimplifyandstrengthenfurthertheorganisationalstructureofthebusiness.From2003to2008theconfectionerybusinesswasrunusingaregionalstructure,withstrongleadershiptodrivestrategicchangeandbuildstrongcommercialfunctions.Sincetheintroductionofourglobalcategoriesin2006forChocolate,GumandCandy,weareincreasinglymanagingourcommercialstrategiesonaglobalbasisanddrivingin-marketexecutionatabusinessunitlevel.


performancescorecard

Goal

Annual organic revenue growth of 4–6%

Comments

Forthesecondsuccessiveyear,weexceededthetopendofourgoalrange.

Basebusinessrevenuesup7%

7%

2008 result

Total confectionery share gain

WedeliveredgoodglobalmarketsharegrowthandincreasedshareintheUKby50bps.

Marketshare*up40bpsto10.5%

40bpsMid teens trading margin by 2011

StrongunderlyingoperatingmarginprogresswasdrivenbytheinitiativeswithintheVIAplan,principallytheearlybenefitsofrestructuringandimprovementsatourunderperformingbusinesses.

Marginsup180bpsto11.9%

11.9%

Strong dividend growth

Whiletheincreaseisinlinewithourprogressivepolicy,thepay-outratioissomewhataheadofourmedium-termtargetof40–50%.

Dividendgrowthof6%

6%

Growth in Return on Invested Capital (ROIC)

ROICisagoodmeasureoftheeffectivenesswithwhichweareusingourshareholders’resources.In2008,weinvestedinrestructuringtomakelong-termefficiencyimprovements.Thisresultedinstrongprofitgrowthoffamodestincreaseininvestedcapital.

ROICup110bps

110bps

Efficient balance sheet

Withinterestcoverof7.6times,adebttoEBITDAratioof2.1timesandaBBBcreditrating,wemaintainedagoodbalanceofefficiencyandprudenceinuncertaineconomictimes.

*Latestavailablesharedata.GlobalmarketsharesarepublishedbyEuromonitorinJulyofeachyearforthepreviousyear.

Ourgoalsandprogressonnon-financialperformanceindicatorsareexplainedinOursustainabilitycommitmentsonpage24.


2. efficiency ‘Relentlessfocusoncost&efficiency’

3.capabilities‘Ensureworld-classquality’

1.growth ‘Fewer,Faster,Bigger,Better’

> Categoryfocusforscaleandsimplicity> Driveadvantaged,consumerpreferredbrandsandproducts> Acceleratewhitespacemarketvia‘SmartVariety’> Createadvantagedcustomerpartnershipsviatotalconfectionerysolutions

> Expandproductplatformsandstrengthenroutetomarketthroughpartnershipandacquisition

> Realisepriceandoptimisecustomerinvestment> ReduceSG&Acostbase> Deliversupplychaincostreductionandreconfigurationinitiatives

> Rationaliseportfolio> Optimisecapitalmanagement

> Operateacategory-ledbusinessenabledthroughconsistentcommercialcapabilities

> Investinscience,technology&innovationtodeliverpreferredproductsatcompetitivecost

> Drivefocuseddecisionmakingandspeedofexecution> Sharpentalent,diversityandinclusivenessagenda> Leveragepartnershipstostreamlineprocessesandreducecosts

Priority 2009 plans

OUTLOOK

2009priorities

AND

for

strategicOur


OurcommitmenttotheVIAisunchangedandwewillcontinuetofocusonimplementingmanymoreoftheprojectsandinitiativesthatmakeuptheplan.Thiswillcontributetothegreaterefficienciesandperformanceimprovementsthatwillbeessentialtodeliversuperiorshareholderreturns,particularlyintheuncertaineconomicclimatethatallbusinessesnowhavetooperate.

Ourprioritiesfor2009areclearandaresetoutinthetableopposite.Theyaresimilartothosewehadinplacefor2008butadaptedtothechallengingeconomicenvironmentin2009.

TheyareconsistentwiththeVIAbusinessplanthatgovernsourstrategy.

OutlookCadburyisnowwellpositionedasafocusedpure-playconfectionerybusiness.Asaresultofactionstakenin2008,wehaveastrongfinancialpositionwithlong-termfinancing.ImplementationofourVIAbusinessplaniswellunderwayand,althoughtherearemanyreconfigurationchallengesahead,managementiscommittedtodeliveringthefullbenefitofplannedcostsavingsandefficiencyimprovements.

Wehavealwaysmaintainedourbeliefthatconfectioneryisaresilientcategorywithintheconsumergoodsmarket.Wesellsmallaffordabletreatsandeveninchallengingtimes,consumersinemerginganddevelopedmarketswillstilllookforaffordabletreatstoprovideamoment’spleasure.

Whilewewillnotbeimmunetothecontinuedweakeconomicenvironment,atthisearlystagein2009,weexpecttodeliverrevenuegrowtharoundthelowerendofour4–6%goalrangeandmakegoodprogresstowardourgoalofmid-teensmarginsby2011.

TheVisionintoAction(VIA)planembodiesallaspectsofourstrategywhichwebelievewillenableustodeliversuperiorshareholderreturns.

Attheheartofourplanistheperformancescorecard–thefinancialtargetswehavesetourselves–judiciouslyreinforcedbyourpriorities,sustainabilitycommitmentsandculture.Inthissection,weexplainthekeyelementsoftheplan,focusingonthethreekeyprioritiesandtheperformancescorecard.Oursustainabilitycommitmentsarecoveredinmoredetailintheoursustainabilitycommitmentssection.

Vision into Action plan prioritiesOurVIAsetsoutspecificactionsforeachofitsthreestrategicpriorities.Everyyeartheseactionsarereviewedandupdatedforchangesinmarketconditionsandstrategicdevelopments.Opposite,wedescribeinmoredetailthewayinwhichimplementingourprioritiesoverthefouryearsoftheplanwillenhanceourbusiness.

Vision

Governing objective

Performance scorecard

Priorities

Sustainability commitments

Culture

Purpose

visionour

into

actionBusinessplan2008–2011


Be the world’s BIGGEST and BEST confectionery company

To deliver superior shareholder returns

Performance driven, Values led

Vision

Governing objective

Performance scorecard

Priorities

Sustainability commitments

Culture

Purpose Creating brands people love

1. Growth: fewer, faster, bigger, better

2. Efficiency: relentless focus on cost & efficiency

3. Capabilities: ensure world-class quality

Organic revenue growth of 4%–6% pa

Total confectionery share gain

Mid-teens trading margins by end 2011

Strong dividend growth

Efficient balance sheet

Growth in ROIC

Promote responsible consumption

Ensure ethical & sustainable sourcing

Prioritise quality & safety

Reduce carbon , water use & packaging

Nurture & reward colleagues

Invest in communities

1.growthOurgrowthstrategy–‘Fewer,Faster,Bigger,Better’–hasanumberofkeycomponents:

> Categoryandgeographicfocusasameansofprovidingscaleandsimplicity.Wefocusoureffortsonalimitednumberofkeymarketsineachcategory–thosethatarebiggesttoday,orwillbetomorrow.

> Focusingonourbiggest,strongestbrands.Wehavethirteenbrandsthatgeneratearoundhalfourtotalrevenues.Infuturethesebrandswillgetahigherportionofourmarketingsupport.

> Targetingcustomerswhoofferusthebestpotentialrewardwhichincludesomeofourlargestglobalcustomers.

2.efficiencyWerecognisethatitisnotenoughtogrowfaster;wemustalsobemoreprofitable.Ourefficiencytargetisencapsulatedintheambitiontoimproveouroperatingprofitmarginsfrom

around10%in2007tomid-teensby2011.Ourcostreductionandefficiencyprogrammeisimpactingallpartsofthebusiness:insales,generalandadministration(SG&A)costsandsupplychain;intheregions;andatthecentre.By2011,weexpecttoclosearound15%ofCadbury’smanufacturingsitesaroundtheworldandasaresulttoalsoreducetotalheadcountbyasimilaramount.

3.capabilitiesAswedevelopourfocusonbeingapure-playconfectionerybusinesswewillcontinuetoinvestincapabilitiestosupportourpeopletodeliveronourgrowthandefficiencypriorities.

Wewillcontinuetoembedour“BuildingCommercialCapabilities”programme,whichaimstoimprovecommercialdecision-making,andmarketingandsalesexpertisebydefiningacommonwayofmarketingandsellingacrossthebusiness.



businessour

Atthebeginningof2009,weeliminatedtheregionalstructuretooperateassevenbusinessunitsandleveragethestrengthenedcategoryleadershipacrossourmarkets.

£376mRevenue

7%Shareofrevenue

Middle East and Africa

Numberofemployees:5,700Numberofmanufacturingsites:13

Mainmarkets:SouthAfrica,Botswana,Swaziland,Namibia,Kenya,Egypt,Lebanon,Morocco,Nigeria,Ghana

Mainbrands:Cadbury,Halls,Eclairs,Stimorol,Dentyne,Clorets,Trident,Chiclets,Endearmints,Chappies,Bournvita,TomTom,Bubba

North America

£1,201mRevenue

22%Shareofrevenue


Mainmarkets:Canada,US,Mexico

Mainbrands:Trident,Halls,Cadbury,Dentyne,Stride,Chiclets,Bubbaloo,Clorets

South America

£430mRevenue

8%Shareofrevenue


Mainmarkets:Brazil,Argentina,Venezuela,Colombia

Mainbrands:Trident,Halls,Bubbaloo,Chiclets,Beldent

units


Europe

£1,097mRevenue

20%Shareofrevenue


Mainmarkets:France,Turkey,Russia,Poland,Spain,Denmark,Greece,Portugal,Romania,Netherlands,Switzerland,Sweden,Norway,Belgium

Mainbrands:Trident,Halls,Hollywood,Stimorol,Dirol,Wedel,Carambar,Jelibon,Kandia,Poulain

24%Shareofrevenue

£1,269mRevenue

Britain & Ireland


Mainmarkets:UK,RepublicofIreland

Mainbrands:CadburyDairyMilk,CremeEgg,Flake,Green&Black’s,Crunchie,Bassetts,Maynards,Trebor,Trident,Halls,TheNaturalConfectioneryCo.,Eclairs

Asia

£337mRevenue

6%Shareofrevenue


Mainmarkets:India,Malaysia,ThailandandChina

Mainbrands:CadburyDairyMilk,Bournvita,Halls,Eclairs/Choclairs,Clorets,Dentyne

Pacific

£665mRevenue

13%Shareofrevenue


Mainmarkets:Japan,Australia,NewZealand

Mainbrands:Cadbury,TheNaturalConfectioneryCo,Boost,CherryRipe,Clorets,Recaldent,Halls


heavenchocolate

46%ChocolateshareofCadburyrevenue

$87bnSizeofglobalchocolatemarket

no.5Cadburyglobalchocolatemarketposition

7.5%Cadburyglobalchocolatemarketshare


Chocolateismainlyaregionalbusinesswhereconsumersseekaparticulartasteineachmarket.Productionishistoricallycomplexandthereisscopeformajorefficienciesthroughrationalisation.

2008 marked a year of continued strong growth for Cadbury Dairy Milk in its principal emerging markets, namely India and South Africa.

Indiahasamongstthelowestconsumptionlevelsofchocolateintheworld.CadburyDairyMilk,astheleadingchocolatebrand,isfocusedongrowingchocolateconsumption.Highadvertisinginvestment,communicationthatencouragesconsumerstosubstitutechocolatesforlocalsweets,andexcitinglowunitpricepacks,havegrownthebrandby36%whileincreasingchocolateconsumptionby25%in2008.

InSouthAfrica,CadburyDairyMilkcelebratedanall-timemarketsharerecordfor2008.Thiswassupportedbythelaunchoffournew‘Local‘n’Lekker’(‘localanddelicious’)variants,theintroductionofthreenewpremiumCadburyDairyMilkflavoursandaninnovativepromotionprogramme.

Cadbury’sfocuschocolatebrands:


gumwalk&talk


33%GumshareofCadburyrevenue

$23bnSizeofglobalgummarket

no.2Cadburyglobalgummarketposition

28.9%Cadburyglobalgummarketshare

Gumisthefastestgrowingconfectionerycategory,andthemostconsolidated.Itisalsoaglobalbusinesswhereeconomiesofscalearesignificant.

2008 marked a strong performance for soft texture slab gum in Europe.

Usingour‘smartvariety’approachwerolledoutourlongerlastingtechnology,developedundertheStridebrandintheUS,tothreeofourfocusbrandsacrossEurope:TridentSenses;HollywoodStyle;andStimorolSenses.Thisaward-winningmulti-countryroll-outmarkedthemostsuccessfulbrandlaunchinCadburyEurope’shistory.Continuedmarketsharegrowthin2008,particularlyinSpain,PortugalandGreece,highlightedthebenefitsofappropriatelocalisationofwinningglobalplatforms.

2008wasagoodyearinourotherlargegummarketsincludingtheUS,Mexico,andJapan.PowerfulgrowthingumwasalsoseeninouremergingmarketsincludingSouthAfrica,BrazilandIndiawherewecontinuedtogainshareinthebubblegummarket.InIndia,Bubbalooachievedthefastestgaininbrandawarenessandbecameafirmlyestablished,differentiatedproductin2008,supportedbysuccessfuladvertisingandfocuseddistributionactivation.

Cadbury’sfocusgumbrands:


21%CandyshareofCadburyrevenue

$49bnSizeofglobalcandymarket

no.1Cadburyglobalcandymarketposition

7.2%Cadburyglobalcandymarketshare


temptationscandy

Candyisthemostfragmentedconfectionerycategorywithaproliferationoflocalbrands.

Summer 2008 saw the UK launch of one of Cadbury’s focus brands, The Natural Confectionery Co.

Freefromartificialcoloursandflavours,thisglobalcandybrandhaswidespreadappealandthroughitsUKlaunch,hasfurthergrownCadbury’sleadershippositioninthecategory.FollowingthesuccessofTheNaturalConfectioneryCo.inAustralia,NewZealandandIreland,theUKlaunchhasbeenwellreceived,winninganumberofindustryawards.

Cadbury’sfocuscandybrands:

20CadburyShareholderMagazine2008/09

financialstatements

Re-presented 2008 Re-presented 2007Re-presented 2008 Non- 2008 2007 Non- 2007 Underlying underlying1 Total Underlying underlying1 Total £m £m £m £m £m £mContinuing operations Revenue 5,384 – 5,384 4,699 – 4,699

Tradingcosts (4,746) (57) (4,803) (4,226) (32) (4,258)Restructuringcosts – (194) (194) – (165) (165)Non-tradingitems – 1 1 – 2 2Profit from operations 638 (250) 388 473 (195) 278Shareofresultinassociates 10 – 10 8 – 8Profit before financing and taxation 648 (250) 398 481 (195) 286Investmentrevenue 52 – 52 56 – 56Financecosts (141) 91 (50) (107) 19 (88)Profit before taxation 559 (159) 400 430 (176) 254Taxation (156) 126 (30) (121) 16 (105)Profit for the period fromcontinuing operations 403 (33) 370 309 (160) 149Discontinued operations2

(Loss)/Profitfortheperiodfromdiscontinuedoperations 84 (88) (4) 323 (65) 258Profit for the period 487 (121) 366 632 (225) 407 Attributableto:Equity holders of the parent 485 (121) 364 630 (225) 405Minorityinterests 2 – 2 2 – 2 487 (121) 366 632 (225) 407Earnings per share from continuingand discontinued operationsBasic 30.1p 22.6p 30.2p 19.4pDiluted 30.0p 22.6p 29.9p 19.2pFrom continuing operationsBasic 24.9p 22.8p 14.7p 7.0pDiluted 24.8p 22.8p 14.6p 7.0p1Includesrestructuringcosts,non-tradingitems,amortisationandimpairmentofacquisitionintangibles,IAS39adjustmentandanyassociatedtaxeffect.

2InaccordancewithIFRS5,the2007incomestatement,statementofrecognisedincomeandexpenseandrelatednoteshavebeenre-presentedfollowingtheclassificationofAmericasBeveragesandAustraliaBeveragesasdiscontinuedoperations.

Consolidatedincomestatementfor the year ended 31 December 2008


Group 2008 2007 £m £m

AssetsNon-current assetsIntangibleassets 3,886 6,183Property,plantandequipmentandsoftwareintangibles 1,848 2,053Investmentinassociatesandotherinvestments 30 34Deferredtaxassets 181 124Retirementbenefitassets 17 223Tradeandotherreceivables 28 50 5,990 8,667Current assetsInventories 767 821Short-terminvestments 247 2Tradeandotherreceivables 1,067 1,197Taxrecoverable 35 41Cashandcashequivalents 251 493Derivativefinancialinstruments 268 46 2,635 2,600Assetsheldforsale 270 71Total assets 8,895 11,338 LiabilitiesCurrent liabilitiesTradeandotherpayables (1,551) (1,701)Taxpayable (328) (197)Short-termborrowingsincludingfinanceleasesandoverdrafts (1,190) (2,583)Short-termprovisions (150) (111)Derivativefinancialinstruments (169) (22) (3,388) (4,614)Non-current liabilitiesTradeandotherpayables (61) (37)Borrowingsincludingfinanceleases (1,195) (1,131)Retirementbenefitobligations (275) (143)Taxpayable (6) (16)Deferredtaxliabilities (121) (1,145)Long-termprovisions (218) (61) (1,876) (2,533)Liabilitiesdirectlyassociatedwithassetsclassifiedasheldforsale (97) (18)Total liabilities (5,361) (7,165)Netassets 3,534 4,173EquitySharecapital 136 264Sharepremiumaccount 38 1,225Otherreserves 3,348 2,673Equity attributable to equity holders of the parent 3,522 4,162Minority interests 12 11 Total equity 3,534 4,173

Balancesheetat 31 December 2008


Consolidatedcashflowstatementfor the year ended 31 December 2008

Group 2008 2007 £m £m

Net cash inflow from operating activities 469 812Investing activitiesDividendsreceivedfromassociates 10 8Proceedsondisposalofproperty,plantandequipment 18 57Purchasesofproperty,plantandequipmentandsoftware (500) (409)AmericasBeveragesseparationcostspaid (107) (30)AmericasBeveragesnetcashandcashequivalentsdemerged (67) –Acquisitionsofbusinessesandassociates 16 (352)Netcashassumedonacquisitions – 6Saleofinvestments,associatesandsubsidiaryundertakings 48 27Cashremovedondisposal (4) (1)Acquisitionsanddisposals 60 (320)Movementinequityinvestmentsandmoneymarketdeposits (245) 127Netcashusedininvestingactivities (831) (567)Net cash (outflow)/inflow before financing activities (362) 245Financing activitiesDividendspaid (295) (311)Dividendspaidtominorityinterests – (1)Capitalelementoffinanceleasesrepaid (21) (21)Proceedsonissuesofordinaryshares 58 56NetmovementofsharesheldunderEmployeeTrust 12 (13)Proceedsofnewborrowings 4,382 2,026Borrowingsrepaid (4,167) (1,722)Netcash(usedin)/generatedfromfinancingactivities (31) 14Net (decrease)/increase in cash and cash equivalents (393) 259Openingnetcashandcashequivalents–totalGroup 449 186Effectofforeignexchangerates 43 4Closing net cash and cash equivalents 99 449Netcashandcashequivalentsinthecontinuinggroupincludesoverdraftbalancesof£152million(2007:£44million).Therearenocashandcashequivalentsincludedinassetsheldforsale.


Segmentalreporting

2008 Business segment analysis

Reportedmeasures Segmentmeasures Underlying Profitfrom Operating profitfrom Underlying Revenue operations margin Revenue operations margin £m £m % £m £m £mBIMA 1,645 107 6.5 1,645 173 10.5Europe 1,097 44 4.0 1,097 115 10.5Americas 1,631 296 18.1 1,631 315 19.3AsiaPacific 1,002 106 10.6 1,002 143 14.3 5,375 553 10.3 5,375 746 13.9Central 9 (165) n/a 9 (108) n/aProfit from operations 5,384 388 7.2 5,384 638 11.92007 Business segment analysis

Re-presented2007 Reportedmeasures Segmentmeasures Underlying Profitfrom Operating profitfrom Underlying Revenue operations margin Revenue operations margin £m £m % £m £m %

BIMA 1,579 83 5.3 1,579 153 9.7Europe 879 61 6.9 879 82 9.3Americas 1,372 191 13.9 1,372 234 17.1AsiaPacific 860 109 12.7 860 122 14.2 4,690 444 9.5 4,690 591 12.6Central 9 (166) n/a 9 (118) n/aProfit from operations 4,699 278 5.9 4,699 473 10.1


justgood

businessCorporateresponsibilityisoneofthethingsthatmakesCadburyspecial.Fornearly200yearswehaveappreciatedthat“doinggoodisgoodforbusiness”.

Overthepastfewyears,wehavemadesomesignificantimprovementsinourapproachapplyinggreaterrigourandmovingfromamindsetof‘responsibility’tooneof‘sustainablebusinesspractices’.

FormoreinformationonCadburycorporateresponsibilitypleasegotowww.dearcadbury.com

Theresultisanagendathatpushestheboundariesinkeepingwithourambitiontobethebiggestandbest.Wehave:

> IntegratedsustainabilityintoourVIAplan> Establishedcleargoalsintheformofoursustainabilitycommitments

> Createdleadingedgeprogrammes–PurpleGoesGreen,theCadburyCocoaPartnershipandBetreatwise

> Developedspecifictrainingforourpeopleandkeysuppliers

> Ensuredthatourcompanyvalues–Performance,Quality,Respect,IntegrityandResponsibility–helpusachieveourcorepurposeof‘creatingbrandspeoplelove’.

Cadbury Cocoa Partnership SustainablecocoaproductionisvitaltoCadbury’ssuccess.Withoutcocoatherewouldbenochocolate.Overthenext10yearsweareinvestingaround£45m–guaranteeingareliable,long-termsourceoftherightqualitycocoa,andtherightqualityoflifeforthosewhogrowit.TheCadburyCocoaPartnershipisagroundbreakinginitiativetosupportsustainablecocoagrowinginGhana,India,IndonesiaandtheCaribbean.

Weinvested£1min2008asaseedfundtoestablishtheprogrammewithannualfundinglevelsplannedtoriseto£5mfrom2010.

Purple goes greenIn2007werevolutionisedourapproachtotheenvironmentinresponsetothechallengeofclimatechange.Wecreatedanewindustry-leadingenvironmentalprogrammecalled‘PurpleGoesGreen’inconjunctionwithexpertssuchasForumfortheFutureandtheCarbonTrust.

Ourstretchingtargets:> 50%reductionofabsolutecarbonemissionsby2020

> 10%reductioninpackagingusedpertonneofproductby2020

> 100%waterscarcesiteswithwaterreductionprogrammesby2009

> Campaignforchange

Oursustainabilitycommitments


Our sustainability commitmentsSixsustainabilitycommitmentsunderpinourVIA.Theyhavebeenspecificallychosenbecausetheybothimproveourbusinessperformanceandourimpactonthewiderworld.OurBoardCSRcommittee,chairedbyLordPatten,overseesourplanstodeliverthesecommitments.

progressupdate

Sustainability commitment

Promoteresponsible consumption

Ensureethicaland sustainablesourcing

Prioritisequalityandsafety

Reducecarbon,wateruseandpackaging

Nurtureandreward colleagues

Investincommunities

2008 results & comments

>95%ofourproductslabelledwithnutritionalinformation>55%ofour‘treat’productslabelledwithadditional‘responsibleconsumption’messages>GlobalreviewofourprogressonWellbeingoptionsinitiated

>CadburyCocoaPartnershipcelebratesitsfirstanniversarywith100communitiesjoining.Cadburyplccelebrates100yearsofcocoatradinginGhana>Sustainableagricultureassessmenttoolimplementedwithgoodprogressonsugar,mintandpalmoil>Supplierengagementprogressingthroughcommonindustryengagementandself-assessmenttoolSupplierEthicalDataExchange(SEDEX)

>Behaviouralprogrammepilotsarebeingrolledoutinallbusinessunitstostrengthensafetyleadershipbehavioursandoursafetyculture>ExcellentprogressonLostTimeInjuryFrequencyRate(LTIFR)withtheGroupobtainingthelowestrateinitshistory>Strengthenedincidentpreventionandinvestigationstrategy

>10%reductioninabsolutecarbonemissionsexpectedby2011withatargetof50%by2020>17%reductioninwaterusesince2006with33sitesnowwithreductionprogrammesinplace>200+GreenAdvocatesinover35countriesdrivingthegreenagenda

>83%ofcolleaguesbelieveCadburyis“agreatplacetowork”>Consistentlyaimtoachieveabove75%inourEmployeeClimateSurveyresultswith2008colleaguecommitmentscoreof3.35andengagementscoreof3.08(outof4)>19%ofexecutivemanagementarefemale

>2.3%ofpre-taxprofitinvestedincommunitycauses>Globalcommitmenttoenablecolleaguevolunteering.>FlagshipinitiativestoaddresstheMillenniumDevelopmentGoalsincluding:Sarvam,TridentSmiles,AfricaAid,andourHIV/AIDSprogramme

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>Roger Carr–Chairman >Guy Elliott–SeniorIndependentDirector >Todd Stitzer–ChiefExecutiveOfficer >Ken Hanna–ChiefFinancialOfficer >Dr Wolfgang Berndt–IndependentNon-ExecutiveDirector

>Colin Day–IndependentNon-ExecutiveDirector

>Baroness Hogg –IndependentNon-ExecutiveDirector

>Lord Patten –IndependentNon-ExecutiveDirector

>Raymond Viault–IndependentNon-ExecutiveDirector

>Henry Udow–ChiefLegalOfficerandGroupSecretary

SirJohnSunderland,DavidThompson,SanjivAhuja,EllenMarramandBobStackallretiredduring2008.Inaddition,KenHannawillstepdownasChiefFinancialOfficerinApril2009.KenwillbesucceededbyAndrewBonfield,whojoinedCadburyinFebruary2009.

RogerCarrwasappointedChairmaninJuly2008andBaronessHoggandColinDayjoinedtheBoardlaterintheyear.The following Directors will be subject to election or re-election at this year’s AGM:

Roger CarrAppointedtotheBoardinJanuary2001,RogerCarrisChairmanoftheBoardandoftheNominationCommittee.RogerCarr’sexperienceasbothaChairmanandChiefExecutiveofotherFTSE100companiesenableshimtoprovidehighlyvaluedadviceandsupporttotheexecutivemanagementteamoftheCompany.HeisresponsibleforconsultingwithmajorUKshareholdersonmattersofcorporategovernance.

RogerCarr’sotherdirectorshipsandofficesinclude:ChairmanofCentricaplc;Non-ExecutiveDirectorofTheBankofEngland;andFellowoftheRoyalSocietyfortheEncouragementofArts,ManufacturersandCommerce.

BoardofDirectorsandGroupSecretary

Todd StitzerAppointedtotheBoardinMarch2000,ToddwasappointedCEOinMay2003.

ToddjoinedCadburyNorthAmericain1983asAssistantGeneralCounselandhasgainedextensiveinternationalexperienceinseniorlegal,marketing,sales,strategydevelopmentandgeneralmanagementroleswithintheCompany.ToddwasPresident&CEOofDrPepper/SevenUp,Inc.between1997and2000andChiefStrategyOfficerbetweenMarch2000andMay2003.Todd’sbusinessleadership,legalandcommercialexpertisemakehimwellplacedtoleadtheorganisationasitdeliversonitscommitmenttoachievesuperiorshareholderperformancethroughVisionintoAction.

Todd’sotherdirectorshipsandofficesinclude:Non-ExecutiveDirectorofDiageoplcandDirectorofBusinessintheCommunity.

Andrew Bonfield AndrewjoinedtheCompanyinFebruary2009andwillbeappointedtotheBoardinApril2009.Hehas10yearsexperienceasaChiefFinancialOfficer.Mostrecently,hewasCFOofBristol-MyersSquibb(2002–2008),theinternationalpharmaceuticalcompany,andwasalsoCFOatSmithKlineBeechamplc(1998–2000),priortoitsmergerwithGlaxoWellcomeplc.AndrewhasestablishedastrongtrackrecordasaninternationalandFTSE100CFO.

Colin Day AppointedtotheBoardinDecember2008,ColinwillsucceedGuyElliottasChairmanoftheAuditCommitteeinApril2009.ColinhasextensiveexperienceofconsumerproductsandhisstrongfocusonperformanceandexecutionenableshimtoaddsignificantlytotheskillsandcapabilitiesofCadbury’sBoard.Otherdirectorshipsandofficesinclude:ChiefFinancialOfficerofReckittBenckiserplcandNon-ExecutiveDirectorofWPPGroupplc.

Baroness Hogg AppointedtotheBoardinOctober2008,BaronessHoggbringsextensiveexperienceofbusiness,governmentandthemediatoCadbury.Otherdirectorshipsandofficesinclude:Chairmanof3iGroupplc;Non-ExecutiveDirectorofBGGroupplc;ChairmanofFrontierEconomicsLimited;andDeputyChairmanoftheFinancialReportingCouncil.

ForfulldetailsofallDirectors,pleasevisittheCadburyGroupwebsiteatwww.cadbury.com


Directors’remunerationreport–highlights

Remuneration policy principlesOurremunerationpolicyforexecutives,includingExecutiveDirectors,isbasedonthefollowingcoreprinciples:>basesalarybetweenmedianandupperquartileoftheCompany’scomparatorgroupandatupperquartileforconsistentlystrongoroutstandingindividualperformance;>aportfolioofincentivesandrewardsbalancetheachievementofshortandlong-termbusinessobjectives;>paymentsundertheperformancerelatedelementsofourincentiveplansbasedonthemeasurabledeliveryofwidelyusedandunderstoodmetrics(calculatedatconstantcurrency);>totalremunerationpotentialdesignedtobecompetitiveintherelevantmarket,therebyenablingustoattractandretainhighcalibreexecutives;>significantopportunitiestoacquireCadburyshares,consistentwithbuildingastrongownershipculture;and

>ExecutiveDirectorsexpectedtomeetashareownershiprequirementsetatfourtimesbasesalary.

Wheresalariesaresetatmorethanmedian,thisreflectsstrongperformancebytheindividualconcernedoveranumberofyearsandotherindividualfactors,suchastheirattractivenesstootherpotentialemployersandthedifficultyinreplacingthemweretheytoleavetheGroup.

TheshareownershipguidelinesnotedaboveareatthetopendofsuchrequirementsforcompaniesintheFTSE100andalsoapplytoseniorexecutiveswithintheGroup,witharangeforthemofonetothreetimessalary,dependingontheirlevelintheorganisation.Newappointmentsaregivenaperiodofthreetofiveyearsinwhichtosatisfythisrequirement.AlltheExecutiveDirectorswhoservedintheyearexceededtherequirement.

Overview of remuneration elements for executives including Executive Directors

Performance Element Objective period Performance conditions for awards

Basesalary Reflectsmarket Notapplicable Reviewedannually,followingexternal valueofroleand benchmarkingandtakingintoaccount individual’sskills individualperformanceandtheincreases andexperience awardedtootheremployees

AnnualIncentivePlan Incentivisesdelivery Oneyear For2008awards,performancetargetswere(AIP) ofperformance basedonamatrixrequiringsimultaneous goalsfortheyear improvementinrevenuegrowthandtrading margin.Therewasalsoanelementrelated tokeyperformanceindicatorsandpersonal objectives.For2009,performancetargets forawardswillbebased70%onarevenue/ marginmatrix,20%onacashflowmeasure and10%onnon-financialmeasures

BonusShare Incentivisessustained Threeyears VoluntarydeferralofAIPwithanadditionalRetentionPlan(BSRP) annualgrowth. match.ContinuedemploymentresultsinaNote:Thisisa Aidsretentionof matchof40%,andperformancetargetsvoluntaryinvestment executives.Supports (basedonamatrixrequiringsimultaneousprogramme andencourages improvementinrevenuegrowthandtrading shareownership margin)canresultinanadditionalmatchof60%

LongTermIncentive Incentiviseslong-termThreeyears PerformancetargetsarebasedonamatrixPlan(LTIP) valuecreation. requiringsimultaneousimprovementin Aidsretentionof UnderlyingEarningsPerShare(UEPS)and executives ReturnOnInvestedCapital(ROIC)

WhetherparticularperformanceconditionsaremetisassessedwithreferencetoourAnnualAccountsortoexternaldatawhichispubliclyavailable.Thesemethodshavebeenchosenastheyareorcanbeindependentlyaudited.


Directors’remunerationreport–highlightscontinued

Performance graphThefollowinggraphshowstheCompany’sperformance(CadburySchweppesplcforperiodspriorto2May2008)measuredbytotalshareholderreturn(TSR)forthefiveyearsto31December2008comparedwiththeTSRperformanceoftheFTSE100companiesoverthesameperiod.ThegraphtakesintoaccounttheSchemeofArrangementbywhichCadburyplcreplacedCadburySchweppesplcastheultimateparentcompanyintheGroupinMay2008.TSRistheproductofthesharepriceplusreinvesteddividends.TheFTSE100indexhasbeenselectedforthiscomparisonbecauseitistheprincipalindexinwhichtheCompany’ssharesarequoted.TSRwasusedasaperformancemeasureforLTIPgrantspriorto2008butwasmeasuredagainstaninternationalpeergroupchosentoreflecttheglobalnatureofourbusiness.ThegraphhasbeenpreparedinaccordancewiththeCompaniesAct2006andisnotanindicationofthelikelyvestingofawardsgrantedunderanyoftheCompany’sincentiveplans.

Share ownership of current Directors As at 31 December 2008DrWolfgangBerndt 60,843RogerCarr 42,874ColinDay(b) –GuyElliott 6,485KenHanna(c) 414,336BaronessHogg(b) –LordPatten 10,602BobStack(a)(c) 525,338ToddStitzer(c) 642,059RaymondViault 14,138

Current Non-Executive Directors’ fees and benefits 2008 2007 Total Total £000 £000DrWolfgangBerndt 71 64RogerCarr 259 105ColinDay(b) 5 –GuyElliott 76 24BaronessHogg(b) 10 –LordPatten 65 65RaymondViault 89 80Notes to tables above(a) BobStackresignedon31December2008.(b) BaronessHoggwasappointedasaNon-ExecutiveDirectoron24October2008andColinDaywasappointedasaNon-ExecutiveDirectoron1December2008.

(c) HoldingsofordinarysharesincludesharesawardedundertheBSRPandtheall-employeeshareincentiveplanandLTIPsharesheldintrust.

£200

£160

£140

£120

£100

£80

£180

Cadbury

28 Dec2003

2 Jan2005

1 Jan2006

31 Dec2006

31 Dec2008

Valu

e of

Hyp

othe

tical

£10

0 H

oldi

ng

31 Dec2007

Cadbury Schweppes Cadbury

May

200

8

FTSE 100

Historical TSR performance growth in the value of a hypothetical £100 holding over five years. FTSE 100 comparison based on 30 trading day average values


Executive Directors’ remuneration Allowances Other AIP/BSRP 2008 2007 Basesalary (a) benefits(b) (c) total total £000 £000 £000 £000 £000 £000

KenHanna 633 215 – 1,233 2,081 1,743BobStack(d) 525 296 124 1,022 1,967 1,856ToddStitzer(d) 985 260 188 2,665 4,098 3,243

Directors’ gains on share plans BSRP performance LTIP Gainson awards awards exercise earnedin earnedin ofshare 2008 2007 2008(c) 2008(c) options total total £000 £000 £000 £000 £000

KenHanna(e) 114 420 258 792 526BobStack 100 361 955 1,416 728ToddStitzer 180 670 230 1,080 772Notes to tables above(a) ThemajorityoftheamountshownasAllowancesforexpatriateDirectors(BobStackandToddStitzer)relatestoincometaxpayments.Wheretaxationratesintheirhomecountryarelowerthaninthehostcountry(egUSversusUK),individualsareprotectedfromahighertaxburdenbymeansofataxequalisationprogrammefundedbytheCompany.Underthisprogramme,wepayanamountequaltotheincrementaltaxresultingfromtheassignmentofindividuals.Thisensuresthattheyarenotpenalisedfinanciallybyacceptingrolesofaninternationalnaturewhichwouldresultinhighertaxationcoststhanwouldhavebeenthecaseiftheyhadremainedintheirhomecountry.Duetothenatureoftaxationpayments,someoftheamountsshownareinrespectofpreviousfinancialyearswhichcancreatedistortionswhenassessingyearonyearmovements.ForallDirectors,Allowancesincludeflexiblebenefitsandcarallowances.KenHanna’sAllowancesincludeanamountequalto30%ofhisbasesalaryinlieuofapensioncontribution,disabilitybenefitsandlifecover.

(b) Otherbenefitsincludecompanycarsand,forexpatriates,housingsupportandotherallowancesnecessarytoensurethattheyarenotpenalisedfinanciallybyacceptingrolesofaninternationalnaturewhichresultinhighercoststhanwouldhavebeenthecaseiftheyhadremainedintheirhomecountry.

(c) ThetotalAIPawardshownwasawardedinrespectof2008performance.ToddStitzeristheonlyDirectoreligibletoparticipateinBSRPandwillinvest100%ofhisAIPintheBSRPon4March2009.TheamountshownincludestheservicerelatedmatchingawardtobeawardedundertheBSRP.BSRPandLTIPawardsearnedin2008willveston4March2009.TheseawardswerefairvaluedatthetimeofthedemergeroftheAmericasBeverages.Thevalueshowninthe‘gainsonshareplans’tableisbasedonanindicativesharepriceof£5.12,themid-marketpriceofashareontheLondonStockExchangeon17February2009.

(d) ToddStitzer’sandBobStack’sbasesalaries,AIPandotherbenefitsarecalculatedandpaidinUSdollars.Theirbasesalariesare:ToddStitzer–US$1,821,312(2007:US$1,726,000);BobStack–US$971,154(2007:US$919,000).

(e) KenHannawasgrantedarestrictedISAPawardinMarch2004over225,000shares,75,000sharesofwhichvestedon26March2008.Themid-marketpriceonthatdateofaCadburySchweppesplcsharewas£5.72.

ToaccessthefullDirectors’remunerationreport,pleasevisitwww.cadbury.com/annualreport08

30CadburyShareholderMagazine2008/09

shareholderinformationYour shareholdingTheCompany’sshareregisterismaintainedbyComputershareInvestorServicesPLC.Queriesregardingyourshareholdingshouldbedirectedasfollows:

> For the UK and Europe:TheRegistrartoCadburyplcComputershareInvestorServicesPLCThePavilionsBridgwaterRoadBristolBS997NHUnitedKingdom

Tel:+44(0)8708735803Fax:+44(0)8707036103

> For the Americas*:TheRegistrartoCadburyplcComputershareInvestorServicesLLC2NorthLaSalleStreetChicagoIllinois60602US

Tel:+18887288741

> For Asia Pacific*:TheRegistrartoCadburyplcComputershareLimitedYarraFalls452JohnstonStreetAbbotsfordVic.3067Australia

Tel:1800011188orTel:+61(1)394154161fromoutsideAustralia*CorrespondencesenttotheseaddresseswillbeforwardedtotheUKforprocessing.

> Global e-mail address [email protected]

> Global web address www.computershare.co.uk

PleasecontacttheRegistrarshouldyouwishto:amalgamatedifferentshareaccounts;haveyourdividendpaiddirectlyintoyourUKbankaccount;receiveyourdividendinforeigncurrencies(GPS);oruseyourdividendtobuyadditionalCadburyplcsharesviatheDividendReinvestmentPlan(DRIP).

Inaddition,dividendtaxvoucherscanbeprintedoffontheComputersharewebsite

Electronic communications ShareholdersmaycommunicateelectronicallywiththeCompanyandcaneither:

>Receivee-mailnotificationthatdocumentsareavailableonthewebsite–ane-mailaddressisrequiredforthisoption;or>Receivenotificationbypostthatdocumentsareavailableonthewebsite.

ElectingforelectroniccommunicationsnotonlysavesCadburymoneybutalsoreducestheCompany’simpactontheenvironment.Toregisterfore-comms,pleasevisitwww-uk.computershare.com/investor/security/emailcapture.asp

Financial calendar and key dates in 2009

Announcementofresultsfor2008 25Feb20092008Finaldividend:–Exdividenddate 22Apr2009–Recorddate 24Apr2009–Lastdateforchangestobank/GPS/DRIPmandatestoreachRegistrar 30Apr2009–Paymentdate 22May2009*Tradingupdate–Quarter1 30Apr2009AnnualGeneralMeeting 14May2009*Tradingupdate 18Jun2009Announcementofhalfyearresultsfor2009 29Jul20092009Proposedinterimdividend:–Exdividenddate 16Sep2009–Recorddate 18Sep2009–Lastdateforchangestobank/GPS/DRIPmandatestoreachRegistrar 25Sep2009–Paymentdate 16Oct2009*Tradingupdate–Quarter3 26Oct2009*Tradingupdate–Fullyearupdate 15Dec2009*Theseareprovisionaldatesandmaybesubjecttochange


shareholderinformationDividends and Annual General Meeting (AGM)Theinterimdividendfor2008of5.3pperordinarysharewaspaidon17October2008.Thefinaldividendfor2008of11.1pperordinarysharewasannouncedbytheDirectorson25February2009and,subjecttoapprovalattheAGM,willbepaidon22May2009toordinaryshareholdersontheregisteratthecloseofbusinesson24April2009.Thefinaldividendwillbepaidon22May2009toADRholdersontheADRregisterat24April2009.ForinformationonhistoricdividendsandsharepricespleaselogontotheInvestorCentrepartofourwebsiteat:http://www.cadburyinvestors.com/cadbury_ir/share_price

Share dealing serviceStocktradeoffersournon-USresidentshareholdersatelephonesharedealingservice.Tousethisservicepleasetelephone+44(0)8454023026betweenthehoursof8.00a.m.and4.30p.m.(UKtime),quotingLowCo204.FordetailsoftheserviceavailabletoUSresidentshareholders,pleasecontacttheGroupSecretariatdepartmentattheCompany’sregisteredofficeon+44(0)1895615000,[email protected]

ShareGiftShareholderswithasmallnumberofshares,thevalueofwhichmakesituneconomicaltosellthem,maywishtoconsiderdonatingthemtocharitythroughShareGift,aregisteredcharity(number1052686)administeredbyTheOrrMackintoshFoundation.

ForfurtherinformationaboutShareGift,pleasecontact:

ShareGift17CarltonHouseTerraceLondonSW1Y5AHUnitedKingdom

Tel:+44(0)2079303737www.sharegift.org

Shareholder fraud – tips on protecting your shareholdingToreducetheriskoffraudpleaseconsiderthefollowing:>KeepyourcertificatesinasafeplaceorholdyourshareselectronicallyinCRESTviaanominee.>KeepallcorrespondencefromtheRegistrarsinasafeplace.>IfyouchangeyouraddressinformtheRegistrars.

>Knowwhenthedividendsarepaid.Considerhavingyourdividendpaiddirectlyintoyourbank,reducingtheriskofchequesbeinginterceptedorlostinthepost.>Ifyouarebuyingorsellingshares,onlydealwithbrokersregisteredinyourcountryortheUKtobuyorsellshares.

Ifyouhaveanyreasontobelievethatyoumayhavebeenthetargetofafraud,orattemptedfraud,pleasecontacttheRegistrarimmediately.

Unsolicited mailYoumayreceiveunsolicitedmailinconnectionwithyourCadburyshareholding.Youcantakestepstolimitthisbycontacting:

TheMailingPreferenceServiceMPSFreepostLON20771LondonW1E0ZT

American Depositary ReceiptsCadburyordinarysharesarequotedontheNewYorkStockExchangeintheformofAmericanDepositaryReceipts,orADRs.EachADRrepresentsfourordinaryshares.TheADRDepositaryisJPMorganChaseBankN.A.–anyenquiriesshouldbedirectedto:

JPMorganChaseBankN.A.POBox64504StPaulMN55164-0504MinnesotaUS

Tel:+18009901135(USonly)orTel:+16514532128(fromoutsidetheUS)

>Globale-mailaddress [email protected]>Globalwebaddress www.adr.com

Global Invest DirectGlobalInvestDirect(GID)isaprogramestablishedbyJPMorganChaseBankN.A.toprovideaconvenientandeconomicalwayforinvestorstoincreasetheirADRinvestmentintheCompany.ContactJPMorganChaseBankN.Aformoredetails.

Dr Pepper Snapple Group, Inc (DPSG)AnyenquiriesrelatingtoDPSGshareholdingsmustbedirectedtoComputershareTrustCompany,N.A.:Tel:+18777459312(USonly)orTel:+17815754033(fromoutsidetheUS)


TheAnnualGeneralMeetingofCadburyplcwillbeheldattheQueenElizabethConferenceCentre,BroadSanctuary,LondonSW1P3EEat2.30p.m.(Londontime)onThursday14thMay2009forthepurposeofconsidering,andifthoughtfit,passingthefollowingresolutions:

Ordinary Resolutions:

1. Toreceivethe2008FinancialStatementsandtheDirectors’andAuditors’Reports.

2. TodeclareandapprovetheFinalDividend.

3. ToapprovetheDirectors’RemunerationReport.

4. Tore-electRogerCarrasaDirector.

5. Tore-electToddStitzerasaDirector.

6. ToelectBaronessHoggasaDirector.

7. ToelectColinDayasaDirector.

8. ToelectAndrewBonfieldasaDirector.

9. Tore-appointDeloitteLLPasAuditors.

10. ToauthorisetheDirectorstosettheAuditors’fees.

11. ToauthorisetheCompanytomakepoliticaldonationsandtoincurpoliticalexpenditure.

12. ToauthorisetheDirectorstoallotsharesintheCompany.

Special Resolutions:

13. Toapprovethedisapplicationofpre-emptionrights.

14. ToauthorisetheCompanytopurchaseitsownshares.

15. Toauthorisetheconveningofageneralmeeting,otherthananAnnualGeneralMeeting,onnotlessthan14cleardays’notice.

Acardenablingyoutoappointaproxyorproxiesforthepurposesofspeakingandvotingontheresolutionsbeingproposedatthisyear’sAGMisenclosedwiththisMagazine.

FormoreinformationontheCadbury2009AGMvisitwww.cadbury.com/nom

noticegeneralmeeting

of annual


“goal”or“target”orthenegativeofthesewordsorothervariationsonthesewordsorcomparableterminology.Forward-lookingstatementsinvolveanumberofknownandunknownrisks,uncertaintiesandotherfactorsthatcouldcauseourorourindustry’sactualresults,levelsofactivity,performanceorachievementstobemateriallydifferentfromanyfutureresults,levelsofactivity,performanceorachievementsexpressedorimpliedbysuchforward-lookingstatements.Theseforward-lookingstatementsarebasedonnumerousassumptionsregardingthepresentandfuturestrategiesofeachbusinessandtheenvironmentinwhichtheywilloperateinthefuture.Inevaluatingforward-lookingstatements,youshouldconsidergeneraleconomicconditionsinthemarketsinwhichweoperate,aswellastheriskfactorsoutlinedinourForm20-FfiledwiththeUSSecuritiesandExchangeCommissionandpostedonCadburyplc’swebsitewww.cadbury.com.ThesematerialsshouldbeviewedinconjunctionwithourperiodichalfyearlyandannualreportsandotherfilingsfiledwithorfurnishedtotheSecuritiesandExchangeCommission,copiesofwhichareavailablefromCadburyplc,CadburyHouse,SandersonRoad,UxbridgeUB81DH,UnitedKingdomandfromtheSecuritiesandExchangeCommission’swebsiteatwww.sec.gov.Cadburyplcdoesnotundertakepubliclytoupdateorreviseanyforward-lookingstatementthatmaybemadeinthesematerials,whetherasaresultofnewinformation,futureeventsorotherwise.Allsubsequentoralorwrittenforward-lookingstatementsattributabletoCadburyplcoranypersonactingontheirbehalfareexpresslyqualifiedintheirentiretybythecautionarystatementsabove.

Registered Office and Group HeadquartersCadburyHouseSandersonRoadUxbridgeUB81DHRegisteredinEnglandandWalesNo.6497379Telephone:+44(0)1895615000

www.cadbury.com

Chief Legal Officer and Group SecretaryHenryUdow

Senior Independent Non-Executive DirectorGuyElliottisourSeniorIndependentNon-ExecutiveDirector.Hemaybecontactedattheregisteredofficeasdetailedabove.

RegistrarsComputershareInvestorServicesPLCP.O.Box82ThePavilionsBridgwaterRoadBristolBS996ZY,UKTelephone:+44(0)8708735803Fax:+44(0)8707036103

ThisMagazinedoesnotcontainsufficientinformationtoallowasfullanunderstandingoftheresultsoftheGroupandstateofaffairsoftheCompanyoroftheGroupandofthepoliciesandarrangementsconcerningDirectors’RemunerationaswouldbeprovidedbythefullAnnualReportandAccounts.

Shareholderswhowouldlikemoredetailedinformationmayobtain,freeofcharge,acopyonlineatwww.cadbury.com/annualreport08orbywritingtoCadbury’sGroupSecretariatatourRegisteredOffice.

Forward-looking statements Exceptforhistoricalinformationanddiscussionscontainedherein,statementscontainedinthesematerialsmayconstitute“forward-lookingstatements”withinthemeaningofSection27AoftheUSSecuritiesActof1933,asamended,andSection21EoftheUSSecuritiesExchangeActof1934,asamended.Forward-lookingstatementsaregenerallyidentifiablebythefactthattheydonotrelateonlytohistoricalorcurrentfactsorbytheuseofthewords“may”,“will”,“should”,“plan”,“expect”,“anticipate”,“estimate”,“believe”,“intend”,“project”,

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