Tate & Lyle Annual Profit Drops on Weak Packaged Food Market, Eyes Modest Growth
Financial Results and Business Outlook
Annual Performance Overview
May 21 (Reuters) - Tate & Lyle posted lower full-year revenue and profit on Thursday, as subdued demand for processed foods and lower product pricing across its major markets hurt.
Acquisition Talks
The company said it was talking to U.S. rival Ingredion that has offered to buy the British food and beverage ingredients maker for £2.74 billion ($3.68 billion).
Key Financial Highlights
Profit and Revenue Figures
• Tate & Lyle reported a 3% fall in annual adjusted core profit to £415 million as revenues also dropped 3% to £2.01 billion, both in line with market expectations.
CEO Commentary
• "(We) faced softer market demand than anticipated, an increasingly complex geopolitical landscape and... overall, our financial performance has been disappointing," CEO Nick Hampton said.
Future Sales and Profit Forecast
• The producer of Splenda, a sweetener used in Coca-Cola's beverages, forecast fiscal 2027 sales to grow at a "modest" rate, helped by volume increase and a flat core profit on a yearly basis.
Market Assumptions and Mitigation Strategies
• The century-old British firm assumes limited impact from the ongoing Middle East war and said it was taking actions to mitigate any cost inflation through pricing, procurement activities and operational discipline.
Analyst Expectations
• Analysts, on average, expect 2027 revenue to be flat on a constant currency basis and adjusted core profit of £419 million, per a company-compiled poll.
Share Price Movement
• Shares in the firm were down 1.1% at 517 pence in early trade.
Additional Information
($1 = 0.7443 pounds)
(Reporting by Prerna Bedi in Bengaluru; Editing by Harikrishnan Nair)
