LONDON (Reuters) - British food ingredients maker Tate & Lyle reported higher full-year sales and earnings on Thursday that were generally in line with raised expectations, helped by an improving business performance and a weaker British currency.
The company, which sells corn syrup and other ingredients to food and drink makers, said sales rose 17 percent to 2.75 billion pounds in the year to the end of March. Excluding the impact of the weak pound, sales rose 2 percent.
In recent years, Tate has been putting more focus on speciality food ingredients, which carry higher margins than its much larger and more commoditised business of bulk ingredients.
But speciality ingredient sales fell 3 percent at constant currency in the year, hurt by weaker demand from large U.S. packaged food makers, whose sales are slowing.
Excluding the impact of currency, adjusted profit before tax rose 20 percent to 271 million pounds and adjusted diluted earnings per share rose 16 percent to 47.1 pence.
The company had raised its expectations for the financial year in February on the back of a strong third quarter..
Looking ahead, Tate said it expected “to make underlying progress in the 2018 financial year” and Chief Executive Javed Ahmed told Reuters that meant expectations for growth in volume and profits, but the company does not give specific financial forecasts.
Tate did however forecast a higher tax rate for the current year, ranging from 21 to 24 percent, up from 18.2 percent in the just-ended year.
Tate’s shares were down 1.8 percent at 0813 GMT.
They had risen 10 percent since February, even as questions swirl about the future trading relationship between the United States and Mexico, which could impact Tate’s sales to Mexican soda makers.
Reporting by Martinne Geller; editing by David Clarke/Keith Weir