Tate & Lyle says makes satisfactory start to year

LONDON (Reuters) - Sugar refiner and sweetener maker Tate & Lyle said on Wednesday it had made a satisfactory start to its financial year and was on track to achieve progress for the year as a whole.

The company, which makes sucralose sweetener Splenda, said in a trading update ahead of its annual shareholder meeting that pretax profit in the first quarter was broadly in line with the equivalent period last year.

"The general deterioration in global economic conditions, particularly in the USA and specifically in raw materials and energy, makes any statement about the outlook more difficult than usual," Tate & Lyle said in the statement.

"Nevertheless, with three months of the financial year behind us and with three of the four divisions having started the year in line with our expectations, we are on track to make progress for the year as a whole," it added.

Shares in Tate & Lyle were down 1.1 percent at 439 pence by 8:35 a.m., valuing the company at around 1.98 billion pounds.

Tate & Lyle, which issued three profit warnings in 2007, has suffered from exceptionally high corn prices, which it said had eased since the end of June.

The company makes most of its profits from its corn-based North American and European sweetener and starch businesses. It also has a European sugar operation and its Splenda business.

Tate & Lyle said the EU sugar market had been very difficult amid surplus stock, while its UK refinery had been hit by higher than expected gas prices.

However, it said it was increasingly confident that the EU sugar demand/supply equilibrium would be restored in the second half and that this would lead to firmer refining margins.