(Alliance News) - Shares in Tate & Lyle PLC plunged on Thursday after it tempered annual guidance amid pricing pressures and a slower second half than anticipated.
The London-based company which supplies food and beverage products to food and industrial markets now expects revenue to be mid-single digit percent lower in the financial year ending March. It expects earnings before interest, tax, depreciation and amortisation growth to be at the low-end of its guidance range of 4% to 7%.
In November, the firm said revenue would be "slightly lower" at constant currency, but Ebitda would rise by between 4% and 7%. Revenue in financial 2024 totalled GBP1.65 billion, while Ebitda amounted to GBP301 million, or GBP328 million on an adjusted basis.
In response, shares plummeted 11% to 559.50 pence each in London on Thursday morning.
In a trading statement covering the three months to December 31, Tate & Lyle said: "While market demand remains broadly stable, we have not yet seen the acceleration in demand we expected in the second half of the 2025 financial year."
Chief Executive Nick Hampton noted a "muted consumer demand environment" and "ongoing geopolitical uncertainties".
"In this environment, we remain focused on delivering profitable volume growth through stronger solutions-based relationships with customers, delivering productivity savings and strong cash flow," Hampton added.
Volume in Food & Beverage Solutions was 4% higher, in the three month period, with growth in each region. But revenue was 4% lower primarily reflecting the pass through of input cost deflation, the firm noted.
CP Kelco, bought in June 2024 for USD1.8 billion, performed in line with expectations, the firm said, delivering strong volume growth in the 2024 calendar year as well as the anticipated progress on the phased margin recovery outlined at the time of the acquisition.
The integration of CP Kelco is "progressing to plan", the firm added.
"The progress to-date reinforces our confidence in delivering the targeted run-rate cost synergies of USD50 million by the end of the 2027 financial year, as well as the identified revenue synergies over the medium term," Tate & Lyle added.
By Jeremy Cutler, Alliance News reporter
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