Tate and Lyle releases annual performance revealing upturn in profits
Global ingredients and solutions firm Tate and Lyle has released its latest annual performance figures, which have revealed a 2% rise in revenues for 2019, to £2.9 billion.
The company, which Confectionery Production interviewed at the last edition of Food Ingredients Europe, traded with profit of £245 million, representing a 35% increase on the previous twelve months across the business.
Among the company’s other key achievements for the fiscal year to March 2020 are a 10% increase in food and beverage solutions profit, to £162 million, 1% profit increase registered for its key sucralose range (£63 million), and 3% primary product profit, to £158 million.
As the firm revealed, measures have been put in place to protect employees, keep operations running and serve customers. Furthermore, during March, the business sought to reduce costs, and preserve cashflow as the coronavirus pandemic worsened.
Consequently, its food and Beverage Solutions volume has been in line with comparative period; with Sucralose volumes 18% higher year-on-year, while its Primary Products bulk sweetener volume was 26% lower; and industrial starch volume was 9% lower.
Nick Hampton, Chief Executive, thanked both employees and customers alike in managing to continue trading during the coronavirus pandemic.
He said: “This has been another year of consistent delivery. We made good progress executing our strategy with strong revenue and profit growth from Food & Beverage Solutions and profit growth from Primary Products in more challenging markets.
“Food & Beverage Solutions delivered revenue growth in each region with revenue from New Products 15% higher. Operational execution was excellent and our three priorities to ‘Sharpen, Accelerate and Simplify’ the business continued to support performance. Customer focus was sharper, our innovation delivered strong growth and we delivered productivity ahead of target. Our culture is enabling us to move with greater pace and agility and we entered the new financial year with real momentum.
“Our purpose of Improving Lives for Generations drives what we do and today we are announcing ambitious new commitments to help support healthy living, build thriving communities and care for our planet.
“I am very proud of the way we have responded to the unprecedented challenges of Covid-19. Our purpose has been at the heart of our response, ensuring we care for our colleagues, their families and local communities as well as playing our part in supporting the food supply chain.”
The company noted that at the start of the 2021 financial year, with lockdowns in the US and Europe, trading in April was mixed.
Food & Beverage Solutions performed well in the month but reduced out-of-home consumption in the US significantly impacted Primary Products.
As the length and extent of the pandemic remains uncertain, the company confirmed that it is not issuing guidance for the year ending 31 March 2021. A trading update will be offered in July 2020.
Hampton added: “In the year ahead our priorities are clear – to look after our people and communities, strengthen our relationships with customers, continue to progress our strategy and maintain our financial strength.
“Tate & Lyle is a resilient business that meets challenges head-on. The fundamentals of our business remain sound despite the challenges of Covid-19. Our high-quality portfolio of ingredients and solutions enable consumers to enjoy healthier and tastier food products and drinks. Demand for these products is growing and this trend is here to stay. Combined with our financial strength, this gives me confidence we will navigate this period successfully and that our future prospects remain strong.”
In addition, the business has also unveiled new environmental targets to reduce greenhouse gas emissions by 30% (by 2030) and cut and coal from its operations, reduce water use, and maintain support for sustainable agriculture.
These new targets and commitments build on the steps already taken to enhance Tate & Lyle’s sustainability across its entire value chain. For example, in September Tate & Lyle announced a landmark sustainable agriculture programme in partnership with Truterra™ (formerly Land O’Lakes Sustain) to help growers in the US Midwest understand the impact sustainable practices can have on their crops and their profitability, and to adopt them.
To demonstrate its commitment to the new environmental targets, Tate & Lyle has linked the pricing of its US$800 million revolving credit facility, extended in May 2020, to the delivery of its new Scope 1 and 2 CO2e emissions, beneficial waste and water reduction targets.
Nick Hampton, Chief Executive at Tate & Lyle, said: “There has never been a greater need for businesses to address the climate change crisis. One of the key pillars of our purpose of Improving Lives for Generations is to care for our planet and with our new environmental targets and commitments we are taking decisive action to protect our planet’s natural resources for the benefit of future generations.”
Anna Pierce, Director of Sustainability at Tate & Lyle, added: “These stretching new targets demonstrate our steadfast commitment to integrate sustainability into our day-to-day business activities, processes and culture.”