UK ingredients group Tate & Lyle reported an increase in dividend alongside a growth in net profit, despite warning of “more modest” profit growth in its sucralose division in the coming year.
The group said today (27 May) that net profit reached GBP167m (US$274.2m) in the year ended 31 March against GBP19m in the previous year. Sales were up 7% to GBP2.7bn.
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“The board is proposing an increase in the final dividend reflecting its confidence in the business,” said chief executive Javed Ahmed. Dividend per share was up 3.5% to 23.7p per share.
The company expects good sales growth in its speciality food ingredients in the coming year.
However, in a note of caution on its sucralose division, the company said that lower manufacturing costs are now reflected in the division’s performance. As a consequence, the “level of profit growth [from sucralose] in the coming year is expected to be more modest than the strong result achieved in 2011”, Tate & Lyle said.
The company expects sweetener margins to remain flat in its bulk ingredients division, with volumes slightly down. However, Tate & Lyle expects industrial starches to perform better, “particularly in Europe”, but “not sufficiently to offset more normal co-product returns”.
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By GlobalDataShares in the group were down 0.16% at 10:35 today to 607.5p a share.
