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Tate & Lyle continues to deliver volume growth

The ingredients company saw volumes grow across its divisions, though profit from the sucralose division will fall during the second half
February 8, 2018

The market appeared discouraged with the third quarter trading update from Tate & Lyle (TATE), with shares down slightly in early trading, but that needs to be set against a general market pull-back. The company reported that profit growth in the food systems business will be “moderate” during the second half due to money spent on investing in its sucralose products, although the ingredients company is on track to deliver an increase in adjusted pre-tax profit for the full year.

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One of management’s goals for 2020 is to increase the proportion of operating profits generated by the specialty food ingredients business. The update was brief, but Tate & Lyle seems to be on track with this objective since it reported volume growth in the division. The bulk division, its largest by proportion of sales, also did well with growth in sweetener volumes in North America and profit growth that is expected to be “robust” by the full year.