Sweet profits at Tate & Lyle

27th May 2011 07:44

Food ingredients group Tate & Lyle managed to offset reduced selling prices for its SPLENDA Sucralose brand to grow sales by 7% in the year ended 31 March, while profits surged.Group revenue grew from £2.53bn to £2.72bn, beating broker estimates of around £2.6bn. Bulk Ingredients grew by 10%, while Speciality Food Ingredients increased by a lesser 2%.The firm, famous for its brand of sugar, said that lower manufacturing costs for SPLENDA Sucralose - combined with increased sales, operational leverage and improved product mix - helped operating profit jump 20% to £321m, from £268m previously."The lower sucralose manufacturing costs are now reflected in the performance of this division and, accordingly, the level of profit growth in the coming financial year is expected to be more modest than the strong result achieved in financial year 2011," the group said.Reported pre-tax profit was £245m, significantly up from the loss of £116m, as the previous year was affected by exceptional items of £298m relating to impairments from the Fort Dodge facility in Iowa.The final dividend has been upped by 5% to 16.9p per share, bringing the full-year dividend to 23.7p per share, a 3.5% increase from the 22.9p paid out the year before.Disposals of the EU Sugars, Molasses and Fort Dodge plant helped the group to cut back net debt by 43%.---BC