Tate & Lyle Regulatory News (TATE)

Half year results for the six months to 30 September 2022

Issued: Thursday 10 November 2022

Strong first half performance with good progress delivering growth-focused strategy

HEADLINES

· Strong first half performance with Group revenue +20% and adjusted operating profit +29%

· Good progress delivering growth strategy as newly focused speciality food and beverage solutions business:

− Food & Beverage Solutions revenue +21% including inflation price-through and mix management

− New Products revenue +19% benefiting from focus on innovation and customer collaboration

− Integration of Quantum Hi-Tech acquisition, a leading dietary fibre business in China, progressing well

· Managing impact of cost inflation through strategic mix management, pricing, productivity and cost discipline

· Adjusted profit before tax1 +10% with strong Tate & Lyle and significantly lower Primient joint venture profits

· Strong balance sheet and cash delivery underpins investment for growth and progressive dividend policy

· Outlook for year to 31 March 2023 - adjusted profit before tax to be in-line with current market expectations

FINANCIAL SUMMARY

NICK HAMPTON, CHIEF EXECUTIVE SAID

"Our strong first-half represents an excellent start to Tate & Lyle's first full year as a growth-focused, science-driven, speciality food and beverage solutions business. Food & Beverage Solutions delivered another half of strong revenue and profit performance with broad-based growth across all regions. We continued to see robust customer demand for solutions which make healthier food and drink, and to benefit from our increasing focus on innovation and close customer collaboration.

We have seen significant inflation and supply chain volatility in raw materials, energy and logistics costs, especially in Europe. We have worked closely with our customers to provide visibility of increasing input costs and continue to follow this approach as we enter discussions for 2023 calendar year contract renewals.

The separation of the Primient joint venture was executed successfully in April to the great credit of both the Tate & Lyle and Primient teams. While Primient had a difficult first half due to inflation and operational challenges, underlying demand remains robust and with a focus on cash generation we have received US$76m in cash dividends this year.

The strategic re-positioning of Tate & Lyle to focus on speciality food and beverage solutions has significantly enhanced the quality and resilience of our business. Despite the uncertain economic outlook, we remain confident that the strength of our ingredient portfolio across attractive categories and regions, our focus on serving our customers, and the expertise and commitment of our people will enable us to successfully deliver our growth-focused strategy."

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1 Comparatives for adjusted results for the six months to 30 September 2021 are pro-forma financial information published on pages 44 and 45 of the half year results statement for that period issued on 4 November 2021. Free cash flow comparative is continuing operations only.

2 The adjusted results for the six months to 30 September 2022 exclude exceptional items, amortisation of acquired intangible assets and other fair value adjustments, the tax on those adjustments and tax items that are themselves exceptional. A reconciliation of statutory and adjusted information is included in Note 2 to the Financial Information. Growth percentages are calculated on unrounded numbers. Changes in adjusted performance metrics are in constant currency throughout this statement.

3 Pro-forma adjusted diluted EPS has been calculated based on the earnings for the period and the shares in issue adjusted for impact of the 6 for 7 share consolidation as if it occurred on 1 April 2021. 

4 Statutory results are continuing operations only

KEY HIGHLIGHTS1

Food & Beverage Solutions: continued strong revenue momentum

· Underlying volume +2% from robust customer demand; reported volume (8%) lower reflecting the planned transition of Primary Products Europe capacity, supply chain challenges and one-off factors

· Revenue +21% with double-digit organic growth across all regions

− Volume excluding Primary Products Europe (5%) lower delivering +21% revenue growth from 13ppts inflation price-through, 12ppts strategic mix management and 1ppt acquisitions

· Adjusted operating profit +26% at £113m

Continued focus on innovation and customer collaboration driving New Products revenue growth

· New Products revenue +19%2 reflecting good demand for fortification and mouthfeel solutions

· New Products represent 15% of Food & Beverage Solutions revenue

Sucralose delivers steady earnings

· Volume +9% due to strong customer demand, a phasing benefit and modest optimisation of production

· Revenue +12% with higher volume and benefits from customer mix

· Adjusted operating profit 8% higher at £39m

Group results reflect strong Tate & Lyle profits and significantly lower profits in Primient joint venture

· Revenue +20%; adjusted operating margin +110bps in constant currency; adjusted profit before tax +10%

· Share of adjusted profit of Primient joint venture 62% lower1 due to inflation and operational challenges

− Primient executed in-year supplementary pricing where possible with the ability to further price-through inflation during the 2023 calendar year bulk sweetener contracting round

· Received US$76m in cash dividends from Primient, the full amount expected for the 2023 financial year

· Proforma adjusted diluted EPS +9% after adjusted effective tax rate at 21.9%

· Statutory profit after tax on total operations up £19m at £121m from the profit on disposal of Primient offset by the inclusion in the current year of only 49.7% of profits from the retained interest in the joint venture

· Free cash flow of £62m (2021 - £20m) benefiting from higher profits and working capital in-line with the comparative period despite the impact from inflation

· Net debt £345m lower at £281m at 30 September 2022

− Primient net receipts of £1.0bn; acquisition of Quantum £(184)m; special dividend £(497)m

− Net debt to EBITDA ratio 1.0x

· Interim dividend of 5.4p reflects new earnings base, share consolidation and special dividend in May 2022

Continuing to invest in delivering growth-focused strategy

· Strengthened customer-facing solutions capability in areas such as nutrition, sensory and regulatory

· Acquired Nutriati, an ingredient technology business producing chickpea protein and flour

· Opened new Innovation and Customer Collaboration Centre in Santiago, Chile

· Capital projects to deliver growth expansion and ease capacity constraints progressing well

Effective management of significant cost inflation

· £85m of gross cost inflation mitigated by strategic mix management, pricing, productivity and cost discipline

· Quarterly supplemental pricing programme in place since May 2022

· For key production inputs such as corn and energy, forward purchase agreements and hedging are used to help manage input cost volatility and to build supply continuity

Integration of Quantum, a leading dietary fibre business in China, acquired in June progressing well

· Quantum significantly strengthens fortification solutions offering for customers in China and Asia

· Integration on track supported by strong customer relationships and good operating discipline

Good progress on purpose programme and building a more agile and inclusive culture

· Expanded sustainable agriculture programme for stevia

· Food bank partnership programme increased to support local communities

· 42% of top 500 managers are women

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1. Adjusted metrics percentage changes are in constant currency, Comparatives for adjusted results for the six months to 30 September 2021 are pro-forma financial information published on pages 44 and 45 of the half year results statement for that period. Pro-forma adjusted diluted EPS has been calculated based on the earnings for the period and the shares in issue adjusted for impact of the 6 for 7 share consolidation completed on 3 May 2022.

2. Definition of New Products updated to reflect nature of innovation launches see page 47. On previous definition revenue was 16% higher in period.

OUTLOOK

For the year ending 31 March 2023, we continue to expect:

· Revenue growth reflecting current top-line momentum

· To offset input cost inflation through strategic mix management, pricing, productivity and cost discipline

· Adjusted profit before tax to be in line with current market expectations with stronger profits in Food & Beverage Solutions offsetting lower profits from the minority holding in Primient.

OVERVIEW OF THE HALF-YEAR

Business environment and trading

The Group has made an excellent start to the year. Revenue in the first half was 20% higher reflecting the pricing-through of inflation and strong strategic mix management to deliver higher margin business in a period of capacity constraint. Adjusted operating profit was 29% higher. Adjusted profit before tax was 10% higher reflecting strong performance from the core business and weaker performance from our minority holding in the Primient joint venture.

Tate & Lyle is a global leader in sweetening, mouthfeel and fortification and we saw revenue growth across each of these platforms in the half. Our broad portfolio and technical capabilities provide customers with solutions that reduce sugar, calories and fat, and add fibre to their products, and consumer demand for healthier food and drink remained robust across the period. Underlying volume was slightly ahead of the comparative period at 2% higher. However, reported volume was 8% lower due to three factors each with around equal impact. Firstly, the planned transition of Primary Products capacity in Europe. Secondly, challenges in the operating environment from Covid-19 lockdowns in China and supply chain disruption. Thirdly, one-off factors including our decision to exit certain low margin business and the impact of industrial action at our corn wet mill in The Netherlands over a two-week period, which is now concluded.

We are mindful of the uncertain economic outlook and are closely monitoring consumer and customer demand as we move forward. Our experience during the pandemic, when demand for our speciality ingredients and solutions remained robust with some fluctuations across categories and regions, gives us confidence we can adapt to changing demand patterns.

Input inflation and supply volatility

Our teams have demonstrated agility in successfully navigating significant inflation and supply chain disruption. In the first half, we saw gross cost inflation totaling £85 million in areas such as corn, energy, consumables and transportation. This was mitigated by a combination of strategic mix management, pricing, productivity and cost discipline.

We entered the 2022 calendar year with renewed customer contracts that offset expected inflation. However, the conflict in Ukraine has caused significant further inflation in raw materials (including corn), energy and logistics costs, especially in Europe. It has also created supply chain volatility across a range of inputs (including packaging and chemicals) consumed in our production facilities across the world.

In May 2022, we implemented a programme of supplementary price increases across our main markets to recover incremental input costs. Under this programme, we have worked closely with customers to provide visibility of increasing input costs and are adjusting customer prices on a rolling quarterly basis. Together with a continued focus on delivering productivity and strong cost discipline, this has allowed us to offset input cost inflation. Normal industry practice sees customer contracts in North America and Europe renewed annually from 1 January each year. We will continue to adopt our approach of working closely with customers as we go through the 2023 calendar year contracting round in these regions.

We use forward purchase commitments globally and hedging for corn and energy in the US to help manage inflation and to build supply continuity. Such arrangements delay the impact of incremental cost increases.  In addition, business continuity plans are in place should energy supplies to our two European corn wet mills in the Netherlands and Slovakia be limited or interrupted, which include optimising production to prioritise speciality ingredients.

Delivering progress on our growth-focused strategy

On 1 April 2022, following the sale of a controlling stake in Primary Products in the Americas ('Primient'), Tate & Lyle was re-positioned as a leading global speciality food and beverage solutions business focused on faster growing markets. During the half, we made good progress delivering our growth strategy and increasing our focus on innovation:

· Double-digit organic revenue growth in each region

· New Products revenue up 19% in constant currency (23% on a like-for-like basis)

· New Products revenue 15% of Food & Beverage Solutions revenue

· Risk adjusted revenue of innovation pipeline up 29% since 31 March 2022.

Growth is being driven by the delivery of our strategic growth framework which is centered on four pillars. Progress across these four pillars during the half include:

Integrated solutions for customers

· We continued to invest in strengthening our customer-facing solutions capabilities in areas like sensory, nutrition, regulatory and category and consumer insights. Targeted programmes to develop new ways of working with customers are progressing well and helping to build stronger solutions-based partnerships.

Market focus

· In May, we opened a new Customer Innovation and Collaboration Centre in Santiago, Chile to accelerate the innovation process for customers in southern Latin America.

· In our sweetener platform, to meet growing customer demand across our key markets, we are investing in our stevia facility in China and have just increased capacity in our stevia production line in the US.

Portfolio expansion

· In April, we acquired Nutriati, an ingredient technology business developing and producing chickpea protein and flour, expanding our capability to offer customers sustainable, plant-based solutions. We have seen strong revenue growth and customer interest for both product lines.

· In June, we completed the acquisition of Quantum Hi-Tech (Guangdong) Biological Co., Ltd (Quantum), a leading prebiotic dietary fibre business in China for a total consideration of US$238 million. Quantum has a high-quality portfolio of fructo-oligosaccharides (FOS) and galacto-oligosaccharides (GOS), and the acquisition strengthens our fortification platform and our position as a leading global player in the fast-growing dietary fibres market. The integration of Quantum is on track and, despite some challenges with Covid-19 related lockdowns in China, the business is performing well.

Accelerate innovation

· New Product revenue grew by 19% with the fortification platform up 79% driven by high demand for fibre solutions and the Quantum acquisition. Revenue from our mouthfeel platform was 10% higher reflecting customer demand for innovation, cleaner labels and cost optimsation. Revenue from the sweetener platform was 1% higher reflecting capacity constraints, especially in stevia.

· We extended our scientific partnership with APC Microbiome Ireland through a new two-year research project to increase understanding of how dietary fibres can impact the functioning of the gut microbiome. In August, we announced a jointly filed international patent application for a synbiotic fibre technology that has shown positive preliminary results in improving metabolic health.

Maintaining our financial strength

· Free cash flow generation at £62 million was £42 million higher than the comparative period (continuing operations) benefiting from a strong focus on working capital management, especially important given the headwinds from input cost inflation.

· Our minority holding in Primient offers an attractive cash dividend stream. We have received US$76 million in cash dividends from Primient representing the full amount expected for the 2023 financial year. 

· Productivity remains a key focus, driving further efficiencies in our business. We have made good progress delivering against our target for productivity benefits of US$10 million for the 2023 financial year. We now expect productivity benefits of around US$15 million in the year.

· Proceeds from the Primient transaction further strengthened the balance sheet supporting the acquisition of Quantum (£184 million) and the payment of the special dividend (£497 million). At the end of the half, net debt had decreased by £345 million to £281 million and net leverage was 1.0x net debt to EBITDA. Our strong balance sheet is ready to support further investment for organic and inorganic growth.

Living our Purpose

With continued challenges across the world including Covid-19, climate change, the cost-of-living crisis and the conflict in Ukraine, we remain as determined as ever to deliver on our purpose. Our new more ambitious purpose of 'Transforming Lives through the Science of Food', introduced in April, is gaining strong traction with employees, customers and community partners. We continue to make good progress in each of our three purpose pillars.

Supporting healthy living

· In June, in partnership with the UAE's F&B Manufacturers Business Group, we completed the Middle East's first Sugar and Calorie Reduction Knowledge Building Programme, held at our Customer Innovation and Collaboration Centre in Dubai. The programme focused on supporting food and beverage manufacturers in the region to reduce sugar and calories in their products, with around 400 delegates participating including many customers and officials from regional government food authorities.

· In September, working with the British Nutrition Foundation, we launched a new online fibre calculator. This tool asks people eight questions to assess their current eating habits before giving an overall fibre score and offering simple tips and personalised advice on how to increase their fibre intake.

· In October, we announced support for a three-year research programme by The University of Aberdeen's Rowett Institute to investigate how issues around poverty, food insecurity and obesity may affect shopping habits in the UK. As the only food and drink ingredient solutions supplier on the research panel, our support will include sharing industry insight on reformulation and expertise on nutrition.

Building thriving communities

· Demand for food banks is increasing significantly and so our partnerships with many food banks and other charitable partners across the world have never been more important. Since 2020, we have donated around 3 million meals to people in need in our local communities. 

· We continue to make good progress against our target of achieving gender parity in leadership and management roles by 2025. At 30 September 2022, 42% of the top 500 managers in Tate & Lyle are women. Our UK median gender pay gap (at 1 April 2022) also increased to 9.6% in favour of women, up from 1.7% in favour of women in 2021.

Caring for our Planet

· We have expanded our stevia sustainable agriculture programme in China working with Earthwatch and Nanjing Agricultural University. This programme focuses on improving the environmental and social impacts of stevia production such as reducing fertiliser use and improving soil health through regular testing. Stevia growers are also being supported to pursue sustainability-related verification.

· We continue to make excellent progress on waste management. Over 90% of the waste we generate is beneficially used, for example as nutrients for local farms.

Later this year we will be publishing our third annual Purpose Report describing how our purpose is being lived across Tate & Lyle and progress against our purpose targets and commitments.

PRIMIENT

On 1 April 2022, we completed the sale of a controlling stake in Primient comprising the Primary Products business in North America and Latin America and interests in the Almidones Mexicanos S.A de C.V and DuPont Tate & Lyle Bio-Products Company, LLC joint ventures, to KPS Capital Partners, LP (KPS). Following the transaction KPS held a 50.1% interest in Primient and has Board and operational control, while Tate & Lyle held a 49.9% interest. An exceptional profit on disposal of £98 million has been recorded in the period. Subsequently, upon the issue of share incentives to Primient management, Tate & Lyle's interest in Primient was diluted to 49.7%. Our relationship with KPS has started positively, and the 20-year agreements put in place to provide supply and economic security for both businesses are operating effectively.

During the first half, Primient saw sweetener volume marginally higher with industrial starch volume materially lower as robust demand was more than offset by operational challenges. Revenue was moderately higher reflecting both the pass-through of higher corn costs and in-year supplementary pricing which was executed where possible. Operational challenges in its network of corn wet mills reduced both throughput and efficiency and this, combined with the impact of cost inflation, resulted in significantly lower profits. The 2023 calendar year bulk sweetener contracting round provides the ability to further price-through inflation.

Tate & Lyle has received US$76 million in cash dividends from Primient representing the full amount expected for the 2023 financial year. Of this amount, US$31 million relates to distributions from profits earned by a former joint venture prior to disposal, and US$15 million to settle tax obligations on Primient profits. A dividend of US$15m was received in first half and the remaining US$61m in early November.

DIVIDENDS

£497 million special dividend and associated share consolidation

Following the sale of a controlling stake in Primient, £497 million was returned to ordinary shareholders by way of a special dividend of £1.07 per existing ordinary share on 16 May 2022. To maintain comparability, so far as possible, of the Company's share price before and after the special dividend, this was accompanied by a consolidation and division of the Company's ordinary share capital resulting in ordinary shareholders receiving six new ordinary shares for every seven existing ordinary shares they held. The share consolidation applied to ordinary shareholders on the Register on 29 April 2022.

Interim dividend for six months to 30 September 2022

The Board has approved an interim dividend for the six months to 30 September 2022 of 5.4p (2021 - 9.0p). The interim dividend represents a 40% per share reduction from the prior year's interim dividend. After the effect of the share consolidation implemented in May 2022, this reduction is in-line with the previously communicated approach and reflects the smaller consolidated earnings base following the sale of the controlling stake in Primient, and is consistent with the step down in the final dividend for the year ended 31 March 2022. An underlying growth of 2.5% has been applied to the interim dividend. This dividend will be paid on 4 January 2023 to all shareholders on the Register of Members on 25 November 2022. As well as the cash dividend option, shareholders will be offered a Dividend Reinvestment Plan alternative.

BOARD AND MANAGEMENT

Board of Directors

· Dawn Allen joined the Board on 16 May 2022 as Chief Financial Officer.

· Dr Isabelle Esser joined the Board as a non-executive director on 1 June 2022.

Executive Committee

· Jim Stutelberg, President, Primary Products stepped down from the Executive Committee to take up the role as Chief Executive, Primient on 1 April 2022.

OTHER MATTERS

We will be holding a Capital Markets event on 8 February 2023.

OPERATING PERFORMANCE

The adjusted results for the six months to 30 September 2022 have been adjusted to exclude exceptional items, amortisation of acquired intangible assets and other fair value adjustments, the tax on those adjustments and tax items that are themselves exceptional. A reconciliation of statutory and adjusted information is included in Note 2 to the Financial Information. Growth percentages are calculated on unrounded numbers. Changes in revenue and adjusted operating profit are in constant currency. 

1 Comparatives for adjusted results for the six months to 30 September 2021 are pro-forma financial information published on pages 44 and 45 of the half year results statement for that period.

FOOD & BEVERAGE SOLUTIONS

Strong revenue and profit growth

Underlying volume was 2% ahead of the comparative period. Reported volume was 8% lower due to three factors each with around equal impact. Firstly, the planned transition of Primary Products capacity in Europe (this transition is expected to continue into future financial years). Secondly, challenges in the operating environment from Covid-19 lockdowns in China and supply chain disruption. Thirdly, one-off factors including our decision to exit low margin business and the impact of industrial action at our corn wet mill in the Netherlands, which is now concluded.

Revenue was 21% higher in constant currency at £752 million with double-digit growth across all regions. Strong price/mix leverage in Food & Beverage Solutions of 26ppts starting from volume of 5% lower (this excludes a decline of 3ppts from Primary Products Europe) delivered revenue growth of 21%. This was delivered through 12ppts of leverage from strategic mix management to deliver higher margin business in a period of capacity constraint, 13ppts of leverage from the pricing through of input cost inflation and higher corn costs, and 1ppt of leverage from acquisitions.

Adjusted operating profit was 26% higher in constant currency at £113 million benefiting from strong strategic mix management, a transparent approach with customers to the pricing-through of input cost inflation and good cost discipline. We entered the 2022 calendar year with renewed customer contracts that offset expected inflation. This, together with supplementary pricing from May to recover incremental inflation across our main markets, and the benefit from productivity, saw operating margins in the period expand by 60bps in constant currency. Operating losses in the European Primary Products business reduced by £6 million to £4 million reflecting the pass-through of higher corn cost and improved pricing. Hedging and forward purchase commitments are used to mitigate input cost inflation and to build supply continuity. These arrangements have delayed the impact of incremental cost increases for inputs, with further increases to be priced-through in the second half. 

The effect of currency translation increased revenue by £55 million and adjusted operating profit by £12 million.

North America

In North America volume was 2% lower while revenue was 14% higher in constant currency at £340 million. Demand was robust across our focus categories with revenue higher in beverage and soups, sauces and dressings as we targeted higher margin fortification and mouthfeel solutions. Significant volume to revenue growth reflected strategic mix management and the passing through of input cost inflation. Growth was partly held back by supply chain disruption, including the impact of reduced availability of key inputs.

Asia, Middle East, Africa and Latin America

Volume was 3% lower reflecting the exit of low margin business and Covid-19 lockdowns in China. Revenue at £208 million increased by 29% in constant currency with double-digit growth in each region. Revenue growth reflected the benefit of mix management, pricing through of input cost inflation and acquisitions.

In Asia, revenue growth was strong across all sub-regions. Good mix management, especially through the exit of low margin business, contributed to strong price/mix leverage, particularly in south east Asia and China. In June, we acquired Quantum, a leading prebiotic dietary fibre business in China, which strengthens our fortification platform, enhances our solutions capabilities and extends our customer offering in China and Asia. Quantum contributed 11ppts in revenue growth in Asia.

In Latin America, revenue was double-digit higher reflecting strong mix management and pricing which more than offset the impact of capacity constraints. Revenue benefited from good progress in fibre and sweetener solutions into bakery and soups, sauces and dressings categories in Mexico, and good growth in southern Latin America. Solutions for customers addressing front-of-pack labelling regulations continue to be a driver of growth in the region. 

In the Middle East and Africa, volume and revenue were ahead reflecting good performance in mouthfeel and fibre solutions.

Europe

Volume was 14% lower and revenue was 23% higher in constant currency at £204 million. Revenue includes £61 million from the European Primary Products business. Robust demand, the exit from low-margin sweetener business and pricing through of inflation more than offset the impact of supply chain challenges especially from industrial action at our corn wet mill in the Netherlands. We saw good revenue growth across the bakery and soups, sauces and dressings categories. Volume to revenue growth reflected mix management and the pricing through of inflation. Revenue for New Products in Europe increased strongly across all platforms. European Primary Products revenue was strongly higher reflecting improved pricing and the pass-through of higher corn costs. 

New Products

Revenue from New Products increased by 19% in constant currency to £114 million, representing 15% of Food & Beverage Solutions revenue. On a like-for-like basis, which assumes the same ingredients are included in New Products revenues in both the current and comparative periods (i.e. no products are removed from New Product disclosure due to age), New Product revenues were 23% higher. We saw revenue growth across all three platforms of sweeteners, mouthfeel and fortification. Revenue from Quantum helped to accelerate growth in the fortification platform and overall New Product revenue. Revenue in the mouthfeel platform also grew strongly reflecting good demand for innovation, clean label starches and cost optimisation.

To reflect the differentiated profiles of ingredients launched from the innovation pipeline we have adapted the periods from launch for which we consider ingredients to be New Products. We have extended the life cycle for launches which are transformational entrants into the market and take longer to commercialise to 15 years and reduced the life cycle of ingredients which are extensions of products already in our portfolio to five years. Further information is the Additional Information section at the back of this document. Previously, all launches were considered New Products for the first seven years from their launch. On the previous methodology, New Products revenue for the six months to 30 September 2022 was 16% higher than the comparative period.

SUCRALOSE

Strong performance

Sucralose volume increased by 9% driven by strong customer demand, some phasing of orders into the half and the benefit of modest production optimisation at our facility in Alabama. Industry demand for sucralose continues to grow in support of sugar reduction initiatives, while the strong demand for our sucralose also reflected high customer service levels in a challenged global supply chain environment. Revenue increased by 12% in constant currency to £97 million reflecting strong volume growth and a benefit from customer mix.

Adjusted operating profit at £39 million was 8% higher in constant currency reflecting the operational leverage of higher volume which was mitigated by input cost inflation. Currency translation increased revenue by £9 million and adjusted operating profit by £6 million.

ADDITIONAL COMMENTARY IN FINANCIAL STATEMENTS

1. Adjusted results and certain other terms and performance measures used in this document are not directly defined within IFRS. We have provided descriptions of such metrics and their reconciliations to the most directly comparable measures reported in accordance with IFRS and the calculation (where relevant) of any ratios in Note 2. Comparatives for adjusted results for the six months to 30 September 2021 are pro-forma financial information published on pages 44 and 45 of the half year results statement for that period issued on 4 November 2021.

2. For the six months to 30 September 2021 pro-forma adjusted profit before tax of £112 million includes the impact of long-term agreements (cost of £3 million) and the pro-forma share of Primient joint venture profit (income of £30 million). Adjusted profit before tax for continuing operations for this period of £85 million excludes these pro-forma adjustments.

3. Statutory income tax expense on continuing operations of £12 million (2021 - £9 million) includes an adjusted income tax charge of £30 million (2021 - £17 million) and a tax credit on adjusting items of £18 million (2021 - £14 million). Additionally, the comparative period included an exceptional tax charge of £6 million. Refer to Note 5. The proforma adjusted tax charge for the six months to 30 September 2021 was £24 million (year to 31 March 2022 - £37 million).

4. For better comparability, adjusted diluted EPS has been adusted in both the current and comparative period to use the weighted average number of shares as if the share consolidation were effected on 1 April 2021, before including the dilutive impact for the respective periods. Additionally, the adjusted diluted EPS in the comparative period has been re-calculated based on the earnings for the period, adjusted for the pro-forma impact of the Primient disposal as if it had taken place on 1 April 2021.

Central costs

Central costs, which include head office costs and certain treasury and legal activities, were 23% lower than the comparative period in constant currency at £15 million reflecting further investment in customer-facing solutions capabilities which was more than offset by strong cost discipline and one-off income of £2 million from an investment in a former joint venture.

Net finance expense and liquidity

Net finance expense at £11 million was 19% lower in constant currency than the comparative period, mainly reflecting higher net income on the Group's cash balances. Because approximately 90% of the Group's borrowings are at fixed rates of interest, the Group is not exposed to significant changes in interest rates.

Exceptional items

The Group recorded net exceptional expense of £11 million in profit before tax from continuing operations. Such items principally included the following:

· £13 million of cash costs associated with the transaction to dispose of Primient, mainly related to continuing IT separation costs to ensure Primient is fully independent by end of the current financial year;

· £3 million exceptional credit relating to historical legal matters following the release of provision for a favourable ruling; and

· £1 million of cash costs relating to productivity and simplification projects in our operations.

The operating exceptional cash outflows for the period totalled £37 million, comprising £8 million of cash outflows related to charges recorded in the current period and £29 million of cash outflows resulting from exceptional costs recorded in prior years.

In total operations, the Group recorded net exceptional income of £87 million. This included the gain on disposal of Primient of £98 million. Refer to the discontinued operations below.

In the comparative period, the Group recorded a net exceptional charge of £65 million in continuing operations (including £6 million relating to an exceptional tax charge).

Adjusted share of profit of Primient joint venture

The Group's share of the Primient joint venture profit is set out in the table below:

1. For the six months to 30 September 2021 pro-forma adjusted profit before tax of £61 million includes the pro-forma impact of long-term agreements (income of £3 million), additional standalone costs in Primient (cost of £7 million) and the pro-forma effect of Primient's financing liabilities (finance expense of £22 million). Adjusted profit before tax for discontinued operations for this period of £87 million excludes these pro-forma adjustments.

Adjusted operating profit was 45% lower in constant currency at £43 million reflecting operational disruption in its plants and inflationary cost pressures.

The Group's share of statutory profit of the Primient joint venture, at a loss of £35m, reflects certain exceptional items linked to the separation from the Tate & Lyle PLC Group.

The Primient joint venture was set up under a US partnership arrangement. Under this arrangement, the partnerhip does not pay tax on its US income as the partners are responsible for this tax. Primient however, pays tax on income earned by its Brazilian subsidiary.

Taxation

The adjusted effective tax rate on continuing operations was 21.9% (30 September 2021 - 21.8% on a pro-forma basis). The rates in both the current and the comparative periods reflect the prevailing rates of corporation tax in the US and UK, the jurisdictions most applicable to the Group's newly speciality focused activities. We expect the adjusted effective tax rate for the year ending 31 March 2023 to be similar to that of the first half of the year.

The reported effective tax rate (on statutory earnings) was 18.4% (30 September 2021 continuing operations - 44.7%). The higher effective tax rate in the comparative period reflected a £6 million exceptional tax charge recorded in that period as well as higher tax deductions on exceptional items recorded by Primient in the current period.

Earnings per share

For continuing operations, on a proforma basis, adjusted basic earnings per share increased by 24% (9% in constant currency) to 26.9p and proforma adjusted diluted earnings per share at 26.6p were also 24% higher (9% in constant currency). The increase in constant currency reflects strong business operating performance partially offset by lower share of profits from the Primient joint venture and a higher adjusted effective tax rate. Statutory diluted earnings per share on total operations increased by 7.3p to 29.0p, principally reflecting the gain on disposal of Primient.

Discontinued operations

Statutory profit after tax for discontinued operations was £65 million. This only reflects the £98 million provisional gain on the disposal of Primient partially offset by tax of £33 million. Confirmation of the gain remains subject to the finalisation of the completion accounts process expected in the second half of the financial year. It is considered very unlikely that this process will result in any reduction in disposal proceeds.

Cash flow, net debt and liquidity

1. Adjusted results and a number of other terms and performance measures used in this document are not directly defined within IFRS. We have provided descriptions of the various metrics and their reconciliation to the most directly comparable measures reported in accordance with IFRS and the calculation (where relevant) of any ratios in Note 2.

2. Comparative year is not on a pro-forma basis.

Adjusted free cash flow from continuing operations was £62 million (2021 - £20 million), an increase of £42 million mainly reflecting higher profits. We saw a £75 million working capital outflow in the period. Overall, this was in line with the comparative period. This is despite significantly higher inflation in the period and reflects the focus on working capital optimisation.

Excluding the impact of the disposal of certain small equity investments, capital expenditure of £33 million was £8 million higher than the comparative period reflecting investment in capacity for growth and investment in recently-acquired businesses. We expect full year capital expenditure for the 2023 financial year to be in the £90 million to £100 million range (year ended 31 March 2022 - £75 million). 

Net debt at 30 September 2022 of £281 million decreased by £345 million since 31 March 2022. The Group received gross cash proceeds of £1.1 billion from the disposal of its controlling stake in Primient and subsequently returned £497 million to shareholders by way of a special dividend. In June 2022, the Group paid net £184 million to acquire Quantum Hi-Tech, a prebiotic dietary fibre business in China, and paid a final dividend for the 2022 financial year of £51 million. Net debt has been further reduced since 30 September 2022 following receipt of US$61 million (£54 million) of dividends from Primient.

At 30 September 2022 the Group had access to £1.2 billion of available liquidity through readily available cash and cash equivalents and access to a committed, undrawn revolving credit facility of US$800 million (£719 million). Reported leverage at 30 September 2022 was 1.0 times net debt to (LTM) EBITDA. On a covenant-testing basis the net debt to EBITDA ratio was 0.7 times, which was materially lower than the covenant threshold of 3.5 times.

Retirement benefits

The Group maintains pension plans for certain of its current and former employees in a number of countries. Certain of these arrangements are defined benefit pension schemes. All funded schemes in the UK and US are closed for further accrual. In the UK, the Group's main pension scheme was subject to a bulk annuity insurance policy 'buy-in' whereby the scheme's assets were replaced with an insurance asset matching UK scheme liabilities. In the US, the Group also continues to provide an unfunded post-retirement medical benefit scheme. The largest component of the net deficit continues to relate to schemes in the US that are by their nature unfunded schemes (e.g. US post-retirement medical benefit scheme).

On disposal of Primient, the Group has retained all US defined benefit pension schemes. However, certain funded non-qualified deferred compensation arrangements as well as the unfunded post-retirement medical plans relating to employees who transitioned to Primient have been disposed (£28 million liability).

At 30 September 2022, the Group's retirement benefit obligations were in a net deficit of £112 million, increasing by £5 million (31 March 2022, excluding liabilities held for sale - net deficit of £107 million). The principal driver for this increase was unfavourable foreign currency translations differences leading to a £17 million increase in the net deficit. This was only partially offset by a net £6 million actuarial gain. Whilst there was a reduction in the valuation of plan liabilities as a result of the impact of the significant increase in corporate bond yields on the discount rate, this was mostly offset by worse than expected returns on plan assets in the US (and matched by the UK Group scheme 'buy-in' policy). Other notable movements included employer's contributions of £5 million, which were in line with the comparative period. The remaining movements led to a net £1 million decrease in the net deficit.

Basis of preparation

The Group's principal accounting policies are unchanged compared with the year ended 31 March 2022. This condensed set of consolidated financial information for the six months to 30 September 2022 has been prepared on a going concern basis, on the basis of the accounting policies set out in the Group's 2022 Annual Report, in accordance with UK adopted IAS 34, 'Interim Financial Reporting' and the Disclosure Guidance and Transparency Rules of the United Kingdom's Financial Conduct Authority.

Details of the basis of preparation, including information in respect of the Group's alternative performance measures, can be found in Note 1 to the attached financial information. 

Going Concern

The Directors are satisfied that the Group has adequate resources to continue to operate as a going concern for the foreseeable future and that no material uncertainties exist with respect to this assessment. In making the assessment, the Directors have considered the Group's balance sheet position and forecast earnings and cash flows for the period from the date of approval of this condensed set of consolidated financial information to 31 March 2024. The business plan used to support the going concern assessment (the "Base case") is derived from Board-approved forecasts together with certain downside sensitivities.

Further details of the Directors' assessment are set out below:

At 30 September 2022, the Group has significant available liquidity, including £516 million of cash and US$800 million (£719 million) from a committed and undrawn revolving credit facility, of which US$100 million matures in 2025 and US$700 million matures in 2026. The earliest maturity date for any of the Group's US Private Placement notes is October 2023, when US$120 million will mature. For the purpose of the going concern assessment it is anticipated that this debt will be repaid from existing cash.

The Group has only one debt covenant requirement which is to maintain a net debt to EBITDA ratio of not more than 3.5 times. On the covenant-testing basis this was 0.7 times at 30 September 2022 (refer to Note 2). For a covenant breach to occur it would require a significant reduction in Group profit. Such reduction is considered to be extremely unlikely.

As set out in our 31 March 2022 Annual Report, during May 2022, the Directors modelled the impact of a 'worst case scenario' to the Base case by including the same three plausible but severe downside risks also used for the Group's viability statement, being: an extended shutdown of one of our large corn wet mill manufacturing facilities following operational failure or energy shortage; the loss of our two largest Food & Beverage Solutions customers; and significant energy, raw material and commodity inflation due to the consequences of conflict in Ukraine. In aggregate, such 'worst case scenario' did not result in any material uncertainty to the Group's going concern assessment and the resultant position still had significant headroom above the Group's debt covenant requirement. The Directors also calculated a 'reverse stress test', which represents the changes that would be required to the Base case in order to breach the Group's debt covenant. Such 'reverse stress test' showed that the forecast Group profit would have to reduce significantly in order to cause a breach.

Since the assessment in May, the Directors updated the model such that it considered similar downside cases and reflected the most recent Board approved forecasts reflecting the current inflationary outlook. Based on this assessment, the Directors concluded that in both the Base case and worst case scenario, the Group has significant liquidity and covenant headroom throughout the period to 31 March 2024. Accordingly, the Directors have concluded that there are no material uncertainties with respect to going concern and have adopted the going concern basis in preparing the condensed consolidated financial information of the Group as at 30 September 2022.

Risks and uncertainties

The principal risks and uncertainties affecting the business activities of the Group are detailed on pages 71 to 75 of the Tate & Lyle Annual Report 2022, a copy of which is available on the Company's website at www.tateandlyle.com. The Board considers that the principal risks set out in the Annual Report 2022 remain unchanged and that actions continue to be taken to substantially mitigate the impact of such risks, should they materialise.

CAUTIONARY STATEMENT AND CONFERENCE CALL DETAILS

Webcast and Q&A Details

Presentation Only

A presentation of the results by Chief Executive, Nick Hampton, and Chief Financial Officer, Dawn Allen, will be available to view on our website from 07.00 (GMT) on Thursday 10 November 2022. To access the presentation, visit http://tateandlyle-events.com/. Please note that the Q&A will not be accessible via this link.

Presentation with Q&A

This presentation will be live streamed at 10.00 (GMT), and will then be followed by a live Q&A session. Please register to view this webcast with Q&A by visiting https://event.on24.com/wcc/r/3995521/2E9FB3F410E882D8F5FC0F29A887DE35. Please note that only sell-side analysts and any pre-registered buy-side investors will be able to ask questions during the Q&A session. Sell-side analysts will be automatically pre-registered. To pre-register, please contact Lucy Huang at lucy.huang@tateandlyle.com.

The archive version of the webcast with Q&A will be available on the link http://tateandlyle-events.com/ within two hours of the end of the live broadcast.

For more information contact Tate & Lyle PLC:

Christopher Marsh, VP Investor Relations

Tel: Mobile: +44 (0) 7796 192 688

Nick Hasell, FTI Consulting (Media)

Tel: Mobile: +44 (0) 7825 523 383

CONDENSED (INTERIM) CONSOLIDATED INCOME STATEMENT (UNAUDITED)

CONDENSED (INTERIM) CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED)

CONDENSED (INTERIM) CONSOLIDATED STATEMENT OF FINANCIAL POSITION (UNAUDITED)

* For the reclassification of certain items between net assets classified as held for sale and the continuing Tate & Lyle Group refer to Note 1.

CONDENSED (INTERIM) CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)

A reconciliation of the movement in cash and cash equivalents to the movement in net debt is presented in Note 9. 

Included in the total cash and cash equivalents of £396 million held at 30 September 2021 (31 March 2022 - £127 million), is £11 million (31 March 2022  - £17 million) classified as held for sale. See Note 6.

The cash flows from discontinued operations included above are presented in Note 6.

CONDENSED (INTERIM) CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)

TATE & LYLE PLC

NOTES TO THE FINANCIAL INFORMATION For the six months to 30 September 2022

1. Presentation of half year financial information

The principal activity of Tate & Lyle PLC and its subsidiaries, together with its joint venture, is the global provision of ingredients and solutions to the food, beverage and other industries.

The Company is a public limited company incorporated and domiciled in the United Kingdom and registered in England. The address of its registered office is 5 Marble Arch, London W1H 7EJ. The Company has its primary listing on the London Stock Exchange.

Basis of preparation

The Group's principal accounting policies are unchanged compared with the year ended 31 March 2022. This condensed set of consolidated financial information for the six months to 30 September 2022 has been prepared on the basis of the accounting policies set out in the Group's 2022 Annual Report, as well as being on a going concern basis, in accordance with UK adopted IAS 34, 'Interim Financial Reporting' and the Disclosure Guidance and Transparency Rules of the United Kingdom's Financial Conduct Authority.

The Directors are satisfied that the Group has adequate resources to continue to operate as a going concern for the foreseeable future and that no material uncertainties exist with respect to this assessment. In making the assessment, the Directors have considered the Group's balance sheet position and forecast earnings and cash flows for the period from the date of approval of this condensed set of consolidated financial information to 31 March 2024. The business plan used to support the going concern assessment (the "Base case") is derived from Board-approved forecasts together with certain downside sensitivities.

Further details of the Directors' assessment are set out below:

At 30 September 2022, the Group has significant available liquidity, including £516 million of cash and US$800 million (£719 million) from a committed and undrawn revolving credit facility, of which US$100 million matures in 2025 and US$700 million matures in 2026. The earliest maturity date for any of the Group's US Private Placement notes is October 2023, when US$120 million will mature. For the purpose of the going concern assessment it is anticipated that this debt will be repaid from existing cash.

The Group has only one debt covenant requirement which is to maintain a net debt to EBITDA ratio of not more than 3.5 times. On the covenant-testing basis this was 0.7 times at 30 September 2022 (Refer to Note 2). For a covenant breach to occur it would require a significant reduction in Group profit. Such reduction is considered to be extremely unlikely.

As set out in our 31 March 2022 Annual Report, during May 2022, the Directors modelled the impact of a 'worst case scenario' to the Base case by including the same three plausible but severe downside risks also used for the Group's viability statement, being: an extended shutdown of one of our large corn wet mill manufacturing facilities following operational failure or energy shortage; the loss of our two largest Food & Beverage Solutions customers; and significant energy, raw material and commodity inflation due to the consequences of conflict in Ukraine. In aggregate, such 'worst case scenario' did not result in any material uncertainty to the Group's going concern assessment and the resultant position still had significant headroom above the Group's debt covenant requirement. The Directors also calculated a 'reverse stress test', which represents the changes that would be required to the Base case in order to breach the Group's debt covenant. Such 'reverse stress test' showed that the forecast Group profit would have to reduce significantly in order to cause a breach.

Since the assessment in May, the Directors updated the model such that it considered similar downside cases and reflected the most recent Board approved forecasts reflecting the current inflationary outlook. Based on this assessment, the Directors concluded that in both the Base case and worst case scenario, the Group has significant liquidity and covenant headroom throughout the period to 31 March 2024. Accordingly, the Directors have concluded that there are no material uncertainties with respect to going concern and have adopted the going concern basis in preparing the condensed consolidated financial information of the Group as at 30 September 2022.

The condensed set of consolidated financial information is unaudited but has been reviewed by the external auditor and its report to the Company is set out on page 49. The information shown for the year ended 31 March 2022 does not constitute statutory accounts as defined in Section 435 of the Companies Act 2006 and has been extracted from the Group's 2022 Annual Report which has been approved by the Board of Directors on 8 June 2022 and filed with the Registrar of Companies.

The report of the auditor on the financial statements contained within the Group's 2022 Annual Report was unqualified and did not contain a statement under either Section 498(2) or Section 498(3) of the Companies Act 2006. The interim financial statements should be read in conjunction with the annual consolidated financial statements for the year ended 31 March 2022, which were prepared in accordance with UK adopted International Accounting Standards.

The condensed set of consolidated financial information for the six months to 30 September 2022 on pages 15 to 45 was approved by the Board of Directors on 9 November 2022.

Discontinued operations and application of Held for Sale

On 12 July 2021 the Group announced that it had entered into an agreement to sell a controlling stake in a new company and its subsidiaries ('Primient' or the 'Primient Business'), comprising its Primary Products business in North America and Latin America and its interests in the Almidones Mexicanos S.A de C.V ('Almex') and DuPont Tate & Lyle Bio-Products Company, LLC ('Bio-PDO') joint ventures, to KPS Capital Partners, LP ('KPS') (the 'Transaction'). The Transaction completed on 1 April 2022 and Tate & Lyle now holds a 49.7% interest in Primient (decreased from the 49.9% interest held immediately on completion of the Transaction due to the redemption of a number of shares held by the Group for the return of £1 million to the Group).

In accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations, from 1 July 2021 the Group has classified the business that became Primient as a disposal group held for sale and a discontinued operation in the comparative periods presented. 1 July 2021 reflects the date that negotiations on substantive matters with KPS were completed. An operation is classified as discontinued if it is a component of the Group that: (i) has been disposed of, or meets the criteria to be classified as held for sale; and (ii) represents a separate major line of business or geographic area of operations or will be disposed of as part of a single coordinated plan to dispose of a separate major line of business or geographic area of operations. The results of discontinued operations are presented separately from those of continuing operations. Refer to Note 6 for further details on discontinued operations.

Prior period restatements

The tax structure relating to the Transaction continued to evolve subsequent to the prior year interim announcement. In finalising the structure it was identified that certain North American deferred tax balances would be retained by the continuing business and were therefore incorrectly excluded at 30 September 2021. This was correctly treated at 31 March 2022. As a result, the balance sheet at 30 September 2021 has been restated to include such deferred tax balances within the continuing Tate & Lyle Group (impact increasing Deferred tax liabilities and decreasing Liabilities held for sale by £66 million). In addition, following the completion accounts exercise which has taken place after the Transaction date, the balance sheet at 31 March 2022 has been restated to correctly reflect certain additional non-current assets being assigned to the Primient disposal group held for sale (impact on non-current assets: reducing Property, Plant and equipment by £66 million, reducing Goodwill and other intangible assets by £5 million and increasing Assets held for sale by £71 million).

Both restatements impacted the respective balance sheets only; the income statement, cash flow statement and statement of changes in equity are unaffected.

Changes in accounting policy and disclosures

The accounting policies adopted in the preparation of the condensed set of consolidated financial information are consistent with those of the Group's Annual Report and Accounts for the year to 31 March 2022 but also reflect the adoption, with effect from 1 April 2022, of new or revised accounting standards, as set out below.

On completion of the Primient disposal transaction on 1 April 2022, the Group has continued to apply cash flow hedge accounting to manage its economic price exposure on the purchase of chemicals used in the production process. All corn procurement transferred to Primient on completion of the disposal and the Group procures corn from Primient (both for the manufacturing of corn-based finished goods in the Group's US manufacturing sites and for corn embedded in the finished goods manufactured by Primient and sold to the Group under long-term agreements). The Group has ceased to apply fair value hedge accounting to manage the net corn risk and now manages the corn price risk by using economic hedging principles such as entering into offsetting positions with its supplier (Primient) and customers. As a result of this change the fair value of purchases, sales and inventory of corn-based products is no longer a source of estimation uncertainty.

Several amendments apply for the first time from 1 April 2022 but do not have a material impact on the Group's financial statement.

No other new standards, new interpretations or amendments to standards or interpretations have been published which are expected to have a significant impact on the Group's financial statements, and none have been early adopted.

Seasonality

In previous financial years the Group's principal exposure to seasonality was in relation to working capital as the level of inventories and payables held reflected the timing of crop harvests in North America and purchases. As a result of the disposal of Primient, the Group is no longer subjected to the same degree of seasonality.

Changes in constant currency

Where year-on-year changes in constant currency are presented in this statement, they are calculated by retranslating current year results at prior year exchange rates. Reconciliations of the movement in constant currency have been included in 'Additional information' within this document.

Use of alternative performance measures

The Group also presents alternative performance measures, including adjusted operating profit, adjusted profit before tax, adjusted earnings per share and adjusted free cash flow, which are used for internal performance analysis and incentive compensation arrangements for employees. They are presented because they provide investors with additional information about the performance of the business which the Directors consider to be valuable. For the periods presented, alternative performance measures exclude, where relevant:

- Exceptional items (excluded as they are material in amount; and are outside the normal course of business or relate to events which do not frequently recur, and therefore merit separate disclosure in order to provide a better understanding of the Group's underlying financial performance);

- Amortisation of acquired intangible assets (costs associated with amounts recognised through acquisition accounting that impact earnings compared to organic investments);

- Amoritisation of other fair value adjustments on acquisition (costs associated with amounts recognised through acquisition accounting that impact earnings compared to organic investments);

- Tax on the above items and tax items that themselves meet these definitions.  For tax items to be treated as exceptional, amounts must be material and their treatment as exceptional enable a better understanding of the Group's underlying financial performance; and

- IFRS 5 held for sale adjustment consisting of 1) cessation of depreciation and amortisation of assets of the Primient Business; and, 2) cessation of equity accounting of the share of profits and dividends received from the Group's existing joint venture interests. These adjustments relate to the six-month period to 30 September 2021 and year to 31 March 2022 only. Within adjusted discontinued operations these adjustments are excluded in order to provide a better understanding of the Group's underlying financial performance on a like-for-like basis with the comparative periods.

The change for the exclusion of 'amortisation of other fair value adjustments on acquisition' reflects the relative size of the Quantum acquisition compared to previous recent Group acquisions and was made to treat the amortisation of all fair value adjustments consistently with the amortisation of acquired intangibles. This change does not impact any of the comparative periods presented.

Note also that given the size of the Group's retained share in the Primient joint venture, the Group's adjusted profit before tax will exclude its share of any of the above items relating to the Primient joint venture. This change does not impact any of the comparative periods presented.

Due to the significance of the Primient disposal, where relevant, the Group has also provided pro-forma information in order to provide investors with better comparability of the performance of the continuing operations. Certain comparative information for adjusted results is pro-forma information as published on pages 44 and 45 of the half year results statement for that period issued on 4 November and as published on pages 48 and 49 of the full year results statement for that year issued on 9 June 2022. Pro-forma adjusted diluted earnings per share, for the six months to 30 September 2022 as well as for the comparative periods, has been calculated based on the earnings for the period and the shares in issue adjusted for impact of the 6 for 7 share consolidation as if it occurred on 1 April 2021.

Alternative performance measures reported by the Group are not defined terms under IFRS and may therefore not be comparable with similarly-titled measures reported by other companies. Reconciliations of the alternative performance measures to the most directly comparable IFRS measures are presented in Note 2 and Note 6.

Exceptional items