Tate & Lyle has reported sales for the full year down 3% to £3,147 million and adjusted operating profit down 2% to £349 million.
“During the year, we continued to make steady progress in executing our strategy,” said Javed Ahmed, chief executive. “The delivery of solid profit growth in starch-based speciality ingredients and Food Systems, along with another year of strong growth in emerging markets, was offset by the impact of the cold spring in the US last year followed by the recent severe and prolonged winter, and an increasingly competitive market for SPLENDA Sucralose. While we will continue to face sucralose pricing headwinds in the current year, our strong innovation pipeline, robust balance sheet and continued growth in emerging markets means we are well placed to deliver growth over the longer term.”
Speciality Food Ingredients sales were up 4% (up 4% in constant currency) at £983 million with adjusted operating profit in line with the prior year (up 1% in constant currency) at £213 million. The company said it saw continued strong growth in Asia and Latin America, and noted the acquisition of Biovelop, and in China, the formation of Tate & Lyle Howbetter and agreement to acquire Winway Biotechnology.
Bulk Ingredients adjusted operating profit was 5% lower (4% lower in constant currency) at £172 million due to soft beverage season and unusually cold and prolonged winter in the US.
Tate & Lyle’s board has approved capital investment of £100 million over the next two years in Speciality Food Ingredients to expand capacity for existing and pipeline products
In Speciality Food Ingredients, the company expects to deliver volume growth across all major product categories but a lower profit contribution from SPLENDA Sucralose is expected to offset a good performance elsewhere in the division. Profits in this division are expected to be more evenly weighted between the first and second halves than the previous financial year.
In Bulk Ingredients, Tate & Lyle now anticipates a slower start in the US in its first quarter associated with the prolonged and severe winter, combined with lower European sugar prices in its second half, to outweigh a better performance across other product categories.
Overall, and before the impact of currency movements, Tate & Lyle said that, while it expects performance for the full year to be slightly lower than the comparative period, it is well placed to deliver growth in the longer term.
