LONDON (Alliance News) - Food and drinks flavouring company PureCircle Ltd Monday said it expects to swing to a half-year operating profit after reporting that first-half sales figures are likely to rise by nearly a third.
AIM-quoted PureCircle, which reported a USD3.4 million operating loss for the previous half year, said it expects to move to a "positive" operating profit in the six months ended December 31, 2013, as sales in the first-half are expected to increase by 31% to USD34.7 million.
Earnings before interest, tax, depreciation and amortisation are also expected to move into positive territory after a USD1.5 million negative last half-year.
According to a company trading update, PureCircle expects total volumes of high purity stevia sweeteners and natural flavours to increase by 34%, driven by "new innovations" in its no-calorie sweeteners and natural flavourings.
"We are generating revenues from a wide range of natural sweetener and flavour products and from a wide range of customers directly and through our business partners," Magomet Malsagov, chief executive, said in a statement. "With accelerating roll-outs of food and beverage products using PureCircle's high purity stevia solutions, particularly in the important carbonated soft drink category, the company is confident of continued sales growth and with it improvements in profitability," Malsagov added.
The CEO also said the recent "no objection" letter it received from the US Food and Drug Administration was an "important milestone".
PureCircle has been working with The Coca Cola Company on a new, zero-calorie sweetener, as part of its wider strategy of developing reduced, low- and no-calorie food and beverages.
Meanwhile, PureCircle, which in September 2013 agreed a new financing facility with Macquarie Bank Ltd in order to support an "anticipated growth in sales", said it is sufficiently funded for current expansion plans. It ended the first-half with USD86 million of net debt and USD58 million of cash and facility headroom.
PureCircle said it will release its full interim results on March 19.
PureCircle shares were Monday quoted at 623.50 pence, up 11.00 pence, or 1.8%.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
Copyright © 2014 Alliance News Limited. All Rights Reserved.
