I'm almost certain this is what you're trying to do. The logic to add a new entry was incorrect. You only add one if you have exhausted searching all the current ones, which means you need to finish the current for-search before the add.
Note: Not tested for compilation, but hopefully you get the idea.
static void readadds(char filename[])
{
// Open file from input; create temporary file to store sorted data.
FILE* packetfile = fopen(filename, "r");
FILE* datafile = fopen("packdata.txt", "w+");
// Create storage for lines read from text file, addresses and related data.
char addresses[500][18];
int datasize[500];
int addressno = 0;
if (packetfile != NULL)
{
char line[100];
while(fgets(line, sizeof line, packetfile) != NULL)
{
char thisadd[18];
int thisdata = 0;
//Create arrays to temp store data from each line
if (sscanf(line, "%*s %*s %s %i", thisadd, &thisdata) == 2)
{
// try to find matching address
for(int i = 0; i < addressno; i++)
{
if(strcmp(thisadd, addresses[i]) == 0)
{
//check if the address is already in the array
datasize[i] += thisdata;;
printf("Match!\n");
break;
}
}
// reaching addressno means no match. so add it.
if (i == addressno)
{
printf("Started!\n");
strcpy(addresses[addressno], thisadd); //initialize new address
datasize[addressno++] = thisdata; //initialize assoc. data
}
}
else
{ // failed to parse input parameters.
break;
}
}
for(int i = 0; i <= addressno; i++)
{
printf("%s %i\n", addresses[i], datasize[i]);
fprintf(datafile,"%s %i\n", addresses[i], datasize[i]);
}
}
fclose(packetfile);
fclose(datafile);
}