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Kraft Foods' profits hit by Cadbury costs

Kraft Foods, the owner of Cadbury, has reported a fall in quarterly profits.

Despite the Cadbury takeover helping to boost sales by 30%, Kraft's net profit for the fourth quarter fell 24% to $540m (£335m) due to costs associated with integrating the UK business.

Kraft also warned that it would be increasing prices to offset rising commodity costs.

The firm's expectation of "significant input cost inflation" comes a day after a similar warning from PepsiCo.

Kraft has already raised prices on most of its products in Europe and on more than half of those in North America. It plans more increases this year.

"There's no question that in the developed markets, both in North America as well as Europe, that consumer confidence remains weak," Kraft chief executive Irene Rosenfeld said.

"We expect it will remain weak for the foreseeable future."

Kraft completed its £11.5bn takeover of Cadbury at the beginning of 2010.

BBC News

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