Ingredients manufacturer Tate & Lyle has announced a 40% fall in first-half adjusted pretax profit at the top end of its range.
In the six months to 30 September 2014, its group adjusted profit before tax was £104m, compared to £173m in 2013.
Operational and supply chain disruption cost the company £31m with other mitigating factors including the pass through of lower corn prices and price erosion for Splenda Sucralose. The strength of sterling against the US dollar and other currencies also had an adverse impact.
The company also pointed to the ‘prolonged and severe winter” in the US, which caused ‘operational difficulties’ in its US plants as well as the unexpected and extended shut down of its Splenda Sucralose facility in Singapore. Overcoming these setbacks costs £31m and, as stated on 23 September, the company expects to incur a further £10m cost in the second half of the financial year.
Javed Ahmed, chief executive, said: “As we announced on 23 September, the group’s performance in the first half has been significantly held back by operational and supply chain disruption and an increasingly competitive market for Splenda Sucralose.
“Notwithstanding these factors, the fundamentals of our business are robust with particularly strong growth in the emerging markets for our Speciality Food Ingredients business excluding Splenda Sucralose, a high quality innovation pipeline and a resilient, cash generative Bulk Ingredients business. We are firmly focused on taking the necessary steps to work through the issues we face and improve the group’s performance.”