SUGAR refiner and sweetener group Tate & Lyle yesterday promised a focus on its growing speciality food ingredients under new chief executive Javed Ahmed as the downturn cut annual profit by seven per cent, in line with forecasts.
Ahmed is to sharpen his attention on the $30bn (£20.7bn) global market for specialist starches and super sweeteners like its own Splenda especially in fast-growing emerging markets and run its bulk commodity ingredients and sugar businesses for cash.
But Ahmed – who only took over last October at the underperforming British group – decided against more radical moves such as selling-off its struggling sugar business and warned that his new strategy would take time to show results.
“Our strategy is focus, fix and growth. We have put down the foundations. It is not a quick fix solution and could take up to 24 months to work,” Ahmed said.
He added speciality food ingredients already account for two-thirds of group profits, but he warned that its bulk sweetener, starch and ethanol showed little signs of a pickup in demand in its key market of the United States.
The London-based group, which makes the majority of its earnings in the US, posted pre-tax profits of £229m for the year to the end of March in line with a consensus of £226m.
Tate had already warned of lower profits as the economic downturn had cut the prices of its sweeteners and starches while it is struggling to break even in sugar cane refining.
The group held its year dividend at 22.9p a share. The shares dipped 2.3 per cent yesterday closing at 415p.
City A.M. Reporter