London / UK. (tl) Tate + Lyle PLC, a leading global provider of speciality food ingredients and solutions, announced the following statement of Half Year Results for the six months ended 30 September 2015.
- Group adjusted profit before tax up 28 percent at 103 million GBP (2014: 80 million GBP)
- Speciality Food Ingredients adjusted operating profit up 28 percent at 76 million GBP (2014: 59 million GBP), improved mix and strengthened executional discipline
- Volume from New Products increased by 50 percent
- Bulk Ingredients adjusted operating profit nine percent lower at 42 million GBP (2014: 47 million GBP), impact of difficult commodity markets
- Global supply chain performance strengthening
- Adjusted free cash flow 32 million GBP higher at 92 million GBP (2014: 60 million GBP)
- Interim dividend maintained at 8.2 GBPence per share
Progress on change projects
- Re-alignment of European Eaststarch joint venture completed on 31 October 2015
- Commenced restructuring of European operations in November 2015 to re-align cost base
- Change projects, including re-focus of «Splenda» Sucralose and extension of Speciality Food Ingredients capacity, on track
Ambition to further strengthen the business mix by 2020
- 70 percent of Group profits from Speciality Food Ingredients
- 30 percent of Speciality Food Ingredients sales from Asia Pacific and Latin America
- 200 million USD of sales from new products
Chief Executive’s Statement
Chief Executive Javed Ahmed said: «We have made an encouraging start to the year. Speciality Food Ingredients performed well as volume momentum built throughout the first half, as anticipated, and our new products targeted at the health and wellness space grew strongly. Bulk Ingredients performed steadily despite the impact of sharply lower ethanol margins. Overall, with our change programmes progressing as planned and executional disciplines strengthening across the business, we remain on track to deliver the guidance for the full year we set out in May, and for future growth».
Expectations for the full year remain unchanged from our guidance issued with our full year results in May 2015 that the Group’s adjusted profit before tax from continuing operations in constant currency and on an equity accounting basis will be broadly in line with that of the 2015 financial year at 193 million GBP.
The longer term outlook for the business is positive. Over time, we expect the market for speciality food ingredients to grow at mid-single digits and our objective is to grow modestly ahead of the market and to drive margin expansion. We will target stable earnings from core Bulk Ingredients and to continue to manage Commodities to dampen volatility. As a result, we expect the Group to deliver earnings growth, and for cash flows to improve as a result of the continued application of rigorous capital and working capital management disciplines.