Tate & Lyle PLC half-year results for the 2025 financial year

Key highlights

• Strong volume and profit growth, and cash delivery
  
  1. Encouraging return to volume growth with Group +6% and Food & Beverage Solutions +4%
  2. Adjusted EBITDA² growth +6% and adjusted EBITDA margin² +290bps
  3. Adjusted EPS² +13% from strong profit performance and benefit from share buyback programme
  4. Free cash flow² £127m, up £48m reflecting cash conversion of 94% and good working capital discipline
  
  
• Continued strategic progress on innovation, solution selling and investment to support customers
  
  1. New Product revenue +10% (like-for-like) with strong demand for fibres; +2% on reported basis
  2. Solutions new business wins by value at 22% of pipeline, +1ppt from 31 March 2024
  3. New partnership with Manus for bio-converted stevia sourced and produced at scale in the Americas
  
  
• Sale of Primient completed transformation to speciality food and beverage solutions business
  
  1. Net cash proceeds of £215m being returned to shareholders through share buyback programme
  
  
• Significant acceleration in delivery of growth-focused strategy through combination with CP Kelco
  
  1. Regulatory approvals received and completion expected in the next few days
  2. Creates a leader in Mouthfeel, a critical driver of customer solutions
  3. Strengthens expertise and leading positions across Sweetening and Fortification platforms
  4. Integration plans in place focused on customers, people and performance
  
  
• Good progress on science-based climate targets aligned to 1.5^oC trajectory
  
  1. New renewable energy agreements cover all the electricity purchased by manufacturing operations globally
  
  

Financial headlines

• Positive volume momentum +6% with Food & Beverage Solutions +4% and Sucralose +20%
• Revenue (7)% with Food & Beverage Solutions (8)% due to pass through of input cost deflation weighted to H1
• Adjusted EBITDA² +6%, with Food & Beverage Solutions² +3% and Sucralose +23%
• Further productivity savings of US$27m during H1
• Adjusted profit after tax² +11%, statutory profit after tax (continuing ops) (26)% reflecting increased M&A costs
• Profit after tax from discontinued operations of £95m, includes post-tax gain on Primient disposal of £85m
• Return on capital employed¹ improved by 150bps to 18.5%
• Interim dividend +0.2p to 6.4p per share; one third of prior year full-year dividend, in line with policy

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Revenue growth, adjusted EBITDA and adjusted EBITDA margin, share of adjusted profit of Primient, adjusted earnings per share, free cash flow, return on capital employed (ROCE), net debt and net debt to EBITDA are non-GAAP measures (see pages 10 to 13). Changes in adjusted performance metrics are in constant currency and for continuing operations.

2. Comparative restated to exclude other M&A costs of £(2) million.

Nick Hampton, Chief Executive said:

“It has been a momentous six months for Tate & Lyle.  The combination with CP Kelco, preceded by the sale of Primient, transforms our business into a fully-focused speciality food and beverage solutions business directly aligned to attractive structural and growing consumer trends for healthier, tastier and more sustainable food and drink. 

The business has continued to perform well delivering a return to volume growth, continued strong profit growth and excellent cash generation.  New Product revenue from our innovation pipeline and solutions new business wins both increased, and we announced an important new partnership for all-Americas sourced and manufactured stevia at scale.  CP Kelco performed as expected delivering strong volume growth and higher revenue, underpinning our confidence in a phased recovery in its profitability over time.

Since the announcement of our combination with CP Kelco in June, we have seen a very positive response from our customers who recognise the much broader innovation and solutions capabilities we will offer.  A joint team has developed a comprehensive integration plan which is focused on three priorities – serving our customers, clarity for our people and delivering performance.

The combination with CP Kelco will significantly strengthen Tate & Lyle’s position at the centre of the future of food.  Our combined business, with its leading positions across sweetening, mouthfeel and fortification, deep scientific and solutions expertise, and unrelenting focus on the customer, creates a strong platform from which to accelerate delivery of our growth-focused strategy and create long-term value for shareholders.”

Tate & Lyle standalone

Our outlook remains unchanged.  For the year ending 31 March 2025, we expect to deliver in constant currency:

• Revenue slightly lower than the prior year
• EBITDA growth of between 4% and 7%.

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About Tate & Lyle:  

Supported by our 160-year history of ingredient innovation, we partner with customers to provide consumers with healthier and tastier choices when they eat and drink. We are proud that millions of people around the world consume products containing our ingredients every day. 

Through our expertise in sweetening, fortification, and texture, we develop ingredient solutions which reduce sugar, calories, and fat, add fibre and protein, and provide texture and stability in categories including beverages, dairy, bakery, snacks, soups, sauces, and dressings. 

We have more than 3,300 employees working in around 58 locations in 39 countries, serving customers across 121 countries. Science, Solutions, Society is our brand promise and how we will achieve our purpose of Transforming Lives Through the Science of Food. By living our purpose we believe we can successfully grow our business and have a positive impact on society. We live our purpose in three ways, by supporting healthy living, building thriving communities and caring for our planet. 

Tate & Lyle is listed on the London Stock Exchange under the symbol TATE.L. American Depositary Receipts trade under TATYY. In the year to 31 March 2024, Tate & Lyle revenue from continuing operations totalled £1.65 billion. For more information, please visit https://www.tateandlyle.com or follow Tate & Lyle on LinkedIn, X (Twitter), Facebook or YouTube.