LONDON (Reuters) - Britain’s Tate & Lyle (TATE.L) reported lower full-year profit in line with its forecast on Thursday and signalled that this year would be equally tough as it overhauls its business.
Longer term it said the restructuring it is undertaking this year - aimed at shifting its focus toward higher-margin specialty food ingredients instead of commoditised bulk ingredients - would improve its performance.
The company, which sells sweeteners and other ingredients to global packaged food and drink makers, said group adjusted profit before tax fell 30 percent to 224 million pounds in the year to March 31, in line with its February guidance.
Its adjusted sales fell 14 percent to 2.69 billion pounds.
For the year ending in March 2016, Tate & Lyle expects adjusted profit before tax in line with 2015, assuming it completes the exit of its European bulk ingredients business this summer, as expected.
In addition to that move, the company said last month it would make changes to its struggling Splenda sucralose unit.
Jefferies analysts said the 2016 guidance implied a roughly 6 percent downgrade to analysts’ estimates.
“Despite the laying of firmer foundations, growth is set to remain elusive,” Jefferies analyst Martin Deboo said in a note.
Tate & Lyle said that over time the restructuring should “steadily enhance group profit and returns on capital”.
It said the longer-term outlook for its business was positive, as it expects the global market for specialty food ingredients to grow at a mid-single-digit rate. Its goal is to increase its own sales “modestly ahead of the market”, with organic growth helped by acquisitions.
Reporting by Martinne Geller in London; Editing by Pravin Char