Following the annual sales contract pricing rounds at three of its major businesses – Food & Industrial Ingredients Europe, Sugars Europe and Food & Industrial Ingredients Americas – Tate & Lyle issued a trading update confirming that the company expects to deliver on-target results for the year to 31 March. It is anticipated that the company will deliver profit before interest, exceptional items and goodwill of GBP263m (US$470.4), up from GBP255m.
In a statement Tate & Lyle said that the expansion of production facilities in the US and Singapore were progressing on schedule. “The expanded Alabama facility is expected to commence commissioning in April, as planned, thereby doubling the capacity acquired in April 2004,” the company said.
The company noted that the European market had been affected by an oversupply of sugar, creating “challenging” conditions, which, it is thought, will result in a decline in earnings for Sugars Europe. However, the company added, “the markets for value added food ingredients and industrial starches have been more robust.”
The recent pricing rounds and completion of contract negotiations have allowed the company to recover next year’s increased energy costs in the US. In the US, Tate & Lyle said, “We also anticipate achieving higher total net margins on value added food ingredients and other products.”