Tate & Lyle reports a rise in profits despite a downturn in its food and beverage sector.
- The company’s EBITDA saw a growth of 6%, reaching £188m in six months ending September 2024.
- Overall sales declined by 7%, largely due to an 8% drop in food and beverage sales.
- Sucralose sales offset some losses with a 17% increase to £99m.
- A strategic purchase of CP Kelco is aimed to enhance future innovation and market position.
Tate & Lyle, a British ingredients company, has announced an increase in profits even as its food and beverage sales suffered a downturn. Over the six months leading to September 30, 2024, the company’s EBITDA climbed by 6% to achieve £188m. The food and beverage solutions division saw a more modest rise in profits, edging up by 3% to a total of £157m.
Despite this positive profit outlook, the company’s total sales fell by 7% to £775m. More notably, the food and beverage solutions segment experienced an 8% decline, dropping to £631m. Partially countering these declines, the firm witnessed a strong performance in Sucralose sales, which surged by 17%, reaching £99m.
The sales numbers in Europe were notably impacted, dropping by 23% to £130m. Tate & Lyle attributed this decrease to the pricing strategies needed to manage significant input cost deflation and investment in pricing. The demand for beverages, soups, sauces, and dressings remained healthy, but there was a noticeable drop in demand within the infant nutrition sector.
Innovation continues to be a driving force for the company’s food and beverage solutions, now representing 17% of the division’s total sales. Looking forward, the company anticipates volume growth to pick up, with input costs expected to stabilize. Tate & Lyle maintains an optimistic outlook for the full fiscal year, forecasting a slight decrease in sales but a profit increase ranging between 4% and 7%.
CEO Nick Hampton remarked on the achievements, noting the company’s resilient performance and the strategic developments made, including the acquisition of CP Kelco. This £1.4bn deal, finalized in June, is set to bolster their market capabilities, enhancing innovation and customer solutions. Hampton emphasized that their integration plan prioritizes customer service, internal clarity, and performance deliverance.
Tate & Lyle remains steadfast in pursuing growth and innovation, despite facing sales headwinds.
