UK sugar and sweetener group Tate & Lyle has forecast flat first-half profits but said it is on track to “make progress” in the full year.
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In a trading statement issued this morning (18 September), CEO Ian Ferguson said that trade was “satisfactory”.
“We expect profits from the group’s continuing operations in the first half to be broadly in line with the corresponding period in the prior year and our own expectations,” he said.
The company’s food and ingredients Americas division saw first-half profits in line with expectations.
However, the company added that additional costs in commissioning patented new technology at the Loudon, Tennessee corn wet mill are being incurred. Tate & Lyle said the profit impact from that investment in the first half is expected to be GBP15m (US$27.39m). However, the company added that this impact has been largely offset by improved profit elsewhere and by beneficial exchange rate movements.
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By GlobalDataMeanwhile, at the group’s food & industrial ingredients division in Europe has benefited from improved co-product returns and falling corn costs, the company said.
Its European sugar business has fared less well as it struggles to operate in a “very difficult” market. However, looking to the second half, Tate & Lyle predicted that the business would pick up.
“We remain confident that, during the second half of the year, market equilibrium between supply and demand for EU sugar will be restored, which should lead to progressively firmer refining margins,” the company said.
Sucralose volume growth during the half was described as “strong” but sales values increased at a lower rate due to changes in sales mix.
Tate & Lyle also revealed today that its finance director John Nicholas will leave the company by “mutual agreement” on 30 September.
Pending the appointment of a new finance director, investor relations director Tim Lodge will assume the role of acting group finance director.
