TATE & LYLE’S shares were lifted yesterday after the company saw improved performance at its special food ingredients arm and said half year profit will be similar to last year’s level.
The group’s first half ending 30 September is being held back by the cost of re-opening a second plant for its zero-calorie sucralose sweetener Splenda and the absence of bumper profits from the high prices gained for its animal feed by-products the previous year.
Analysts said these two hurdles will disappear in the second half of the year. They expect Tate & Lyle’s annual earnings to rise three per cent for the full year to March 2013.
In last year’s first half, the company made a profit before tax of £241m on sales of £1.54bn.
“Overall, while recognising the current level of uncertainty around the wider economy and volatile corn markets, we continue to expect to make progress this financial year,” the company said in a trading statement yesterday.
The group said volume of sucralose returned to growth in its second quarter, but would still be lower than a year ago mainly due to tough conditions in Europe as well as strong comparatives with the previous year when a series of new sweetener products were launched.
The company reopened its McIntosh sucralose plant in Alabama earlier this year as its sole plant in Singapore was struggling to cope with demand.
Shares rose 2.4 per cent to 670p.