Life is looking pretty sweet for Cadbury, the UK confectionery giant.

Sure, the ongoing pay protests at four of its domestic plants will have to be handled delicately, while the volatility of global cocoa prices remains disconcerting and the sluggishness of the gum market distracting.

Nevertheless, Cadbury and its CEO Todd Stitzer are sitting more comfortably than they were just two years ago, when investors were pressing for improvement from what they saw as an under-performing business.

Right now, as the group looks to boost margins through its ongoing restructuring programme, its top-line is being helped by robust chocolate sales at home and abroad.

The gorilla ad campaign for Dairy Milk in 2007 got everyone talking about the brand for the right reasons again, following the salmonella scandal of a year earlier. Last September's relaunch of Wispa also won over consumers wallowing in nostalgia for brands of yesteryear. Cadbury said yesterday that it had sold 60m Wispa bars since the brand returned; the company will no doubt be hoping for similar success when it starts pushing the return of Wispa Gold later this year.

Last week, Cadbury won column inches galore when it officially launched the switch of Dairy Milk to Fairtrade certification. What's more, the move seems to have given the group a valuable advantage against its peers with the business community as a whole looking to boost its sustainability credentials.

And, all the while, Cadbury's chocolate portfolio is milking the recession. Stitzer said yesterday that Cadbury had benefited from the growing trend for UK consumers to eschew going out for staying in and watching a DVD - and sharing a pack of Cadbury Clusters at the same time.

Cadbury's chocolate sales are also strong outside the UK. Stitzer cited India as an emerging market in which the business is performing well, while earlier in the day, the company revealed chocolate sales in Australia were growing "progressively" well after the relaunch of Dairy Milk. The resilience of its chocolate business was a highlight of a robust set of first-half results, which included an increase to the group's margin forecast for 2009.

However, there remains a number of challenges for Stitzer and his team to get his teeth into. Cadbury's revenue growth during the first half of the year was driven largely by price increases; indeed, volumes were broadly stagnant.

Stitzer was questioned about the prospect for volume growth in the months ahead and the Cadbury boss said the company is looking "to get some volume back in the business in 2010".

Referring to Cadbury's revenue growth and improved margin forecast amid challenging economic conditions, Stitzer said: "I would take these results in this particular time period any day of the week."

Margins, however, could be boosted by a recovery in gum sales. After a sticky first quarter, Cadbury said its gum business enjoyed a "better" second quarter but the company still saw its share of the category fall in the US.

The downturn and a lack of innovation have been among the factors affecting Cadbury's gum sales in the US and Stitzer is hopeful that economic recovery and the launch of products (including Trident Layers in September) will breathe fresh life into the group's gum business.

Why could a recovery in gum boost margins? Cadbury earns more selling gum than it does chocolate, so, for all the company's growth in chocolate, growth in gum should sweeten profits further. Expect more innovation in gum from Cadbury during the second half of 2009.

When Cadbury issued its first-quarter numbers in April, questions remained over volumes and the US gum business. Amid yesterday's upbeat first-half results, those questions still hang in the air.