Tate And Lyle First Half 2009 Profits
Tate and Lyle have announced pre-tax profits of GBP112 million in its H1 2009 results.
"Tate & Lyle performed slightly ahead of our expectations in the first half of the year, before the impact of exchange translation, despite challenging conditions in a number of our markets," said new CEO Javed Ahmed.
Sales increased by 7% to £1.82 billion. Adjusted operating profit fell by 1% to £148million, with underlying profit before tax down by 13% to £112 million.
Pre-tax profit plunged 59% to £50 million, although most of that was reflected in exceptional costs of £55 million from the decision to mothball the sucralose plant in McIntosh, Alabama.
Tate and Lyle Say Q1 Ahead of Expectations
Tate & Lyle said that it performed better than anticipated during the first quarter of it's financial year, in today's interim management statement.
Profit before tax and exceptional items from continuing operations in the first quarter, after the benefit of favourable exchange translation, was in line with the comparative period and ahead of our expectations. Results have continued to benefit from cost reduction measures taken across the business, it said.
At Food & Industrial Ingredients, Americas, performance was marginally below the level of the comparative period, with lower income from co-product sales partially offset by the favourable impact of exchange translation. Co-product sales remain under pressure from lower cereal prices, reduced demand from the US livestock sector and weaker US export markets, it says.
Meanwhile, at Food & Industrial Ingredients, Europe, profits were above the comparative period and continued to benefit from lower net corn costs.
Sugars performed ahead of expectations, but below the level of the comparative period. As anticipated, profits from molasses were below the exceptional levels achieved in the comparative period, as global cereal prices have reduced from the levels experienced during the second half of calendar year 2008, they droned on.
The strong volume growth seen at Sucralose since the start of the calendar year continued, and the business achieved operating profits ahead of the comparative period. The process of mothballing the sucralose plant in McIntosh, Alabama at a cost of £56 million is proceeding ahead of schedule, they concluded.
Tate And Lyle Interim Results For Half Year
Tate & Lyle have announded their interim results for the six month period to 30th September 2008. Sales grew by 25% to £1,698 million (£1,359 million), group operating profit increased by 3% to £150 million (£145 million) and profit before tax was 4% higher at £128 million (£123 million).
Full report here
Tate & Lyle loses sweetener case
Tate & Lyle has lost a court case to defend its Splenda artificial sweetener from Chinese manufacturers producing generic competitors, reports the BBC.
Its shares dropped by 12% in early trading after the ruling by a judge at the US International Trade Commission.
Analysts say the ruling will allow manufacturers to compete against Tate & Lyle in the market for sucralose - the sweetener's generic name.
The firm is to appeal, asking for a decision by the full commission.
Splenda, a sweetener with no calories, makes up almost 25% of the firm's profits, analysts say.
Tate & Lyle off to 'satisfactory start'
Tate & Lyle P.L.C. on Wednesday said it has made a "satisfactory start" to the year, with pre-tax profit in the first quarter broadly in line with same period a year ago.
The company said its food and industrial ingredients segment in the Americas benefited from improved byproduct returns driven by "volatile and exceptionally high" corn prices. Partially offsetting the returns were some additional costs related to new technology at the company’s Loudon, Tennessee, U.S., corn mill.
In the company’s European food and industrial ingredients segment, meanwhile, Tate & Lyle said co-product prices compensated for higher energy prices, while the Food Systems businesses continued to perform well.
Sucralose, the low-calorie sugar sweetener that Tate & Lyle markets under the Splenda brand, posted strong sales volume growth in line with expectations, though the company did note that the increase in sales prices was slower than anticipated.
Challenges continued to persist in the company’s European Union (E.U.) sugars business and are expected to do so during the next six months. Tate & Lyle said the business is "operating in a very difficult market while surplus stock is absorbed in anticipation of the first reduction in the E.U. reference prices, which will take place on Oct. 1." As part of that reform, sugar prices are expected to be cut by nearly 40% by 2010.
Tate & Lyle did indicate that the second half of the year may deliver market equilibrium between supply and demand for E.U. sugar.
Bunge Acquires Tate & Lyle Sugar Trading Business
White Plains, N.Y., July 2 -- Bunge Limited today announced an agreement to acquire the international sugar trading and marketing division of Tate & Lyle PLC.
The acquisition will strengthen Bunge's position in the sugar value chain by expanding its international trading and marketing activities and by creating a stronger network for sugar origination in Brazil, Thailand and other geographies. The completion of the transaction is subject to the receipt of certain regulatory approvals and other customary conditions.
As a first stage, the operations and employees of Tate & Lyle's international sugar trading business will transfer to Bunge. The working capital in the business will remain with, and be collected and paid by, Tate & Lyle through March 31, 2009, at which point it will be assumed by Bunge upon final completion of the transaction.
"Bunge's strategy is to expand into complementary value chains, and sugar is an essential one," stated Archie Gwathmey, co-CEO, Bunge Global Agribusiness. "In the past two years we have established a sugar marketing and trading operation and purchased a sugarcane mill in Brazil. Strengthening our global team is a natural next step. Tate & Lyle has been one of the world's leading international sugar traders with a long tradition in the business and strong customer and supplier relationships. We are pleased to welcome this team and business to Bunge."
Corn price warning drives Tate & Lyle to four-year low
(Daily Telegraph) -- Tate & Lyle, the struggling sugar and sweeteners group, slumped to a four-year low Wednesday after Citigroup warned about the impact of soaring corn prices.
Tate & Lyle's corn starch is used to sweeten a wide variety of products from cereals to fizzy drinks but Citi believes it will struggle to pass on higher costs over the next couple of years. Corn prices have jumped by 25pc in the last six weeks alone because of the recent floods in the US and Citi analyst Eamonn Ferry predicts Tate & Lyle's corn costs are set to double by 2010. Tate & Lyle shares fell 22¼ to 402¼p.
