US: PureCircle says H1 sales on target
PureCircle has announced mixed sales projections for its H1
Stevia sweetener maker PureCircle has said that it forecasts first-half sales to be in line with expectations, boosted by growth in Latin America, Asia Pacific and some initial uptake in Europe.
In a trading update today (12 January), PureCircle said it expects to achieve a 13.3% improvement in sales to US$15m in the period from 1 July to 31 December. The stevia producer said it has experienced strong growth across its new product ranges, particularly natural flavours and its SG95 brand. The firm's Alpha ingredient, launched in September last year, has also received "good market feedback", the firm said.
However, it said there were no sales to its key beverage customers in the half as they are using their existing inventories.
The company has also slowed down the production of Reb A temporarily 2011 to align inventories with current market demand, resulting in an estimated one-off cost of between $5 and $10m.
Despite increased sales and marketing investments in the firm's EU joint ventures, PureCircle said it expects to report improved operating margins and EBITDA in the six-month period.
"Although our H1 FY12 sales were higher than the comparable period in FY11, they were still modest as expected due to ... late EU regulatory approval," said PureCircle's CEO, Magomet Malsagov. "With the EU market now open, with our new innovations clearly gaining market share and with our diversified customer base we expect an uptick in growth from H2 FY 12."
The European Commission formally approved stevia sweeteners for use within the European Union in November. PureCircle will publish its full first-half earnings results on 29 March.
Shares in the London-listed company slid 4.58% to 91p as of 3.27pm BST.
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