Tate & Lyle, the international food ingredients, supplier has issued its third profit warning in a year.
The company said its profits would be marginally lower than it said they would be last September because of supply chain problems and lower commodity costs.
The company now expects profits to be “modestly below the range stated in September 2014 of £230 to £245m”.
It blamed its "bulk ingredients" division, which manufactures industrial starches and other basic food components and brings in more than two thirds of Tate & Lyle’s sales.
It said: “Bulk Ingredients performed below the prior year period driven by the impact of lower US sweetener volumes in part due to capacity constraints in the wider US transportation network, weakening EU sugar prices which affected bulk sweetener prices in Europe, and a sharp deterioration in ethanol margins near the end of the period. The combined impact of these industry-related factors meant that Bulk Ingredients performed below our expectations.”
Tate & Lyle added: “As previously reported, we expect to incur costs of around £40m in the current financial year as a result of operational and supply chain disruption. Of this, around £15m relates to operational costs which are not expected to reoccur in the next financial year.
“The remaining costs relate mainly to lost sales due to product unavailability and while we expect a return to normal levels of growth off a lower base, we do not expect to see the incremental benefit of the recovery of these lost sales in the 2016 financial year.”