Tate & Lyle unveils solid sales ahead of annual results

Food and sweetener giant Tate & Lyle on Thursday reported 'solid sales' ahead of its annual results.

In a trading statement, the company said it has performed strongly in the year ended March 31st 2013, particularly in its speciality food ingredients division.

"In speciality food ingredients, we will achieve solid sales growth for the full year with the rate of volume growth in the second half slightly ahead of that achieved during the first half," the group said.

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However, annual sucralose volume growth will be slightly lower than the prior year despite normal run rates in the fourth quarter. Operating profit in this division will be broadly in line with last year as a result of the step change in fixed costs associated with business transformation initiatives, the firm stated.

Bulk ingredients has achieved "good underlying performance" for sweeteners in the US and Europe. It is expected to offset the impact of costs associated with handling higher levels of aflatoxin following the severe drought in the US last year and continued challenging market conditions in ethanol.

The British company said the recent strengthening of the US dollar against sterling will result in higher net debt than the previous year.

Tate & Lyle also noted the costs of having to restart the McIntosh facility in the US, investments in global shared services and IT systems and development of a commercial and food innovation centre in Chicago. Fungus also affected corn quality caused by extremely dry and hot conditions.

Such factors impacted last month's third-quarter results which showed a fall in profits.

RD