Tate & Lyle, the bakery ingredients supplier, saw its adjusted profit before tax increase by 28% this year to £103m.
Posting its half-year results to 30 September, the company, which sells sweeteners and other ingredients to packaged food and drink makers, said group sales fell 2% to £1.17bn, while sales at its bulk ingredients division dropped 6%, hurt by lower corn costs and lower commodity prices in the USA for ethanol.
The company said its speciality food ingredients business saw an adjusted operating profit of £76m.
Javed Ahmed, chief executive, 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.”
On 31 October, Tate & Lyle completed the re-alignment of the Eaststarch joint venture with Archer Daniels Midland Inc (ADM) and received €240m (£173m) in cash proceeds as well as dividends from Eaststarch of €94m.
The company said: “As a result of the re-alignment, the group acquired full ownership of the more speciality-focused plant in Slovakia and exited the predominantly bulk ingredient plants in Bulgaria, Turkey and Hungary.
Two long-term distribution agreements have also been put in place under which the group will distribute crystalline fructose, a speciality sweetener, produced in Turkey, and ADM will act as exclusive agent for Bulk Ingredients produced in our Slovakia and the Netherlands facilities.”
An exceptional profit on disposal of approximately £60m will be reported in the second half of the fiscal year, added Tate & Lyle.