My diet is very healthy...I eat chocolate every day

THERE is one surefire way to stop John Sunderland in his tracks - ask him about chocolate. After announcing his latest results to the City last week, the Cadbury Schweppes chief executive was around for as long as it takes to scoff a Creme Egg before leaving on a whistlestop tour of Australia and New Zealand.

But one question managed to catch the 56-year-old Yorkshireman's attention before he dashed off: which is his favourite among his company's vast sweet shop of brands? Dairy Milk, Flake, Roses, Twirl, Crunchie? Surely he won't admit a preference for any of them.

'Oh, I definitely have a favourite,' he says with almost religious fervour. 'Cadbury's Caramel. Without a doubt. Not a day goes by without me enjoying one.'

It doesn't show. While not being a slight man, Sunderland is about half the size of the average chief executive. 'Yes, every day. And have you seen the Miniatures version? Really great.'

So, how come you're not, er, fat? 'Oh, there doesn't have to be a connection like that,' he says, dismissing decades of received wisdom. 'Chocolate can be part of a healthy diet, you know.'

Obviously. But Sunderland's cheery demeanour is from more than just a sugar rush. After all, he is chief executive of the world's largest confectionery and soft drinks company whose products go to more than 200 countries. Last week he reported a 12% rise in pre-tax profits to £886 million for 2001, and a 16% increase in earnings per share.

Especially good results came in from Australia, France, Poland and Russia. But the UK suffered from 'difficult trading conditions', says Sunderland, as well as from integrating the chocolate and sugar businesses, Cadbury Trebor Bassett.

The challenge for Sunderland now is to continue to move the company's core revenue base away from 'CSDs' - carbonated soft drinks - where Cadbury's Dr Pepper and 7-Up are finding the going tough against the larger rivals, Coke and Pepsi. 'Growth was slowing, but why?' asks Sunderland rhetorically. 'We have been anticipating cola fatigue for some time, and it's now happened. Coke and Pepsi are experimenting with different brands and the core brands are continuing to wither and margins decline.'

Hence the need to get into other drinks sectors, which Sunderland has done at speed, snapping up Snapple, Orangina, La Casera, Spring Valley and Slush Puppie in the past two years alone, along with chewing gum brand Hollywood. And the acquisition trail does not stop there. Sunderland is keen to extend Cadbury's portfolio, and with $1bn (£700m) of firepower behind him, he has his eye on some key targets.

However, beyond confirming that he is interested in Turkish confectionery brand Kent, he will reveal no more. But he hints that if there is further consolidation in the US bottling market - a key sector for drinks manufacturers - Cadbury is likely to be an active player.

The UK market, having recorded 2% growth in confectionery last year, is currently 'rather flat', says Sunderland. 'Competition for disposable-income is broadening. If someone had told me before that we'd be competing with mobile phone cards for the teenage market, I wouldn't have believed them, but we're adapting.'

Another concern is the decline of trading outlets, with smaller stores closing and supermarkets seizing more of the market. Again, Sunderland says Cadbury is ready for the challenge, targeting pubs, offices, factories and video shops. 'They're all opportunities as far as we're concerned,' he said.

One thing Sunderland can't control is Easter Sunday - much to his obvious chagrin.

Each year Creme Eggs are the fastest selling confectionery item between January and Easter. So when Easter falls early, as it does this year, Sunderland is not pleased. 'Wouldn't it be great if we could fix Easter on 1 May every year?' he muses.