(Alliance News) - Tate & Lyle on Thursday reported strong profit growth and announced the sale of its remaining stake in its primary product business.
The London-based sweetener and food ingredients supplier said pretax profit jumped 48% in the year ended March 31, to GBP226 million from a restated GBP152 million the year prior.
Revenue fell 6.0% to GBP1.65 billion from GBP1.75 billion.
A final dividend of 12.9 pence per share was announced, decreasing from 13.1p last year. However, this brings the total dividend to 19.1p, up 3.2% from 18.5p.
During the year, Tate & Lyle had to contend with lower volumes due to dampened consumer demand and inflation, although the company said was mitigated by good mix management, productivity savings and cost discipline.
In other news, the company confirmed the sale of its remaining 49.7% stake in North and Latin American-focused Primary Products Investments LLC to KPS Capital Partners LP.
It follows the sale of the company's controlling interest in Primary to KPS in April 2022.
Tate & Lyle is set to receive USD350 million of cash proceeds, approximately USD270 million after taxes and transaction costs which will be returned to shareholders by the way of a share buyback after completion.
Chief Executive Nick Hampton said: "With this sale, the transformation of Tate & Lyle into a fully-focused speciality food and beverage solutions business is complete. We are now well-positioned to capture the significant growth opportunities ahead as we look to provide our customers with the solutions they need."
Outlook for the current financial year outlined an anticipated slight fall in revenue.
Although, earnings before interest, taxes, depreciation, and amortisation growth between 4% to 7% is expected, potentially matching 7% growth reported most recently.
On a long-term basis, after next year, the company has set a financial target for 2028 of 4% to 6% revenue growth each year and adjusted Ebitda growth of 7% to 9%.
Tate & Lyle shares were up 3.3% to 699.28 pence each in London on Thursday morning.
By Elijah Dale, Alliance News reporter
Comments and questions to newsroom@alliancenews.com
Copyright 2024 Alliance News Ltd. All Rights Reserved.
Tate & Lyle (TATE)