Interim Management Statement
Tate & Lyle PLC
Tate & Lyle PLC
Chairman’s Annual General Meeting and Interim Management Statement
This Interim Management Statement covers the period from 1 April 2010 to
30 June 2010 which is the first quarter of the financial year. Following
the changes to our business announced on 27 May 2010, we have also
published today on our website, www.tateandlyle.com,
sales and operating profits under the Group’s new reporting segments as
well as the Group’s new key financial performance metrics for the year
ended 31 March 2010.
At the Annual General Meeting of Tate & Lyle PLC, to be held in London
today, Sir Peter Gershon, Chairman, will make the following statement:
INTERIM MANAGEMENT STATEMENT
OPERATING PERFORMANCE – CONTINUING OPERATIONS
The Group has made a sound start to the financial year.
In our Speciality Food Ingredients division, demand patterns for
speciality sweeteners and starches have remained steady. We have also
continued to experience solid growth in sucralose sales volumes, and are
now seeing the full benefits from the single plant sucralose
manufacturing base.
Within Bulk Ingredients, corn sweetener volumes were somewhat above the
prior year period, reflecting firm demand for HFCS in Mexico and the
benefit of increased European capacity following completion of the
expansion in Slovakia. Industrial starch performance in both the
Americas and Europe was marginally lower, with weaker margins partially
offset by higher volumes. Ethanol margins improved slightly, although
markets have remained depressed.
SUGARS - DISCONTINUED OPERATIONS
On 1 July 2010, we announced an agreement for the sale of our EU Sugar
Refining operations for cash consideration of £211 million and expect
completion by the beginning of September 2010. The book loss on
disposal, before costs, is anticipated to be approximately £55 million,
subject to exchange rate movements and the timing of completion.
The Sugars division, including the other remaining businesses,
principally Molasses and Vietnamese Sugar, which we have announced
processes to sell, will be classified as discontinued in the Half Year
Results to 30 September 2010. Operating profits from the Sugars division
in the first quarter were in line with expectations.
DEBT MANAGEMENT
Net debt of £787 million at 30 June 2010 has reduced from £814 million
at 31 March 2010. The impact of exchange translation on reported net
debt in the quarter was negligible.
In June 2010, we repaid bank debt of approximately £125 million in order
to capture a future cash saving in interest of around £2 million. This
repayment resulted in an accounting charge in the quarter of £6 million
within net interest expense associated with the unwind of cash flow
hedges, which will reverse over the period to maturity in June 2012.
OUTLOOK
In Speciality Food Ingredients, we expect a continuation of the steady
demand patterns experienced during the first quarter.
In Bulk Ingredients, we expect the firm demand for corn sweeteners into
Mexico to continue alongside the modest decline in US domestic demand,
and stable demand in our other food markets. Despite some improvement in
demand, industrial starch margins are expected to remain at lower
levels, reflecting industry overcapacity, and we continue to see little
near term improvement in US ethanol markets.
Overall, we continue to anticipate progress in the current full
financial year.
END
A conference call will be held today at 8.00am BST, hosted by Javed
Ahmed, Chief Executive and Tim Lodge, Chief Financial Officer.
Participants are requested to dial in at least 5 minutes before the
commencement of the call. Dial in details are as follows:
Participant dial in number: +44 (0) 1452 555 566
Conference ID:
89160549Conference ID:
89160549
Replay dial in number: +44 (0) 1452 55 00 00Replay dial in number: +44 (0) 1452 55 00 00
Replay
passcode: 89160549#
Replay
passcode: 89160549#
A replay of this call will be available from two hours after the end of
the live call for 7 days until 28 July 2010.
For more information contact Tate & Lyle PLC:
Chris McLeish, Group VP, Investor and Media Relations
Tel: +44 (0)
20 7977 6211 or Mobile: +44 (0) 7919 102 730
Tel: +44 (0)
20 7977 6211 or Mobile: +44 (0) 7919 102 730
William Baldwin-Charles, Head of Media Relations
Tel: +44 (0) 20
7977 6165 or Mobile: +44 (0) 7810 151 425
Tel: +44 (0) 20
7977 6165 or Mobile: +44 (0) 7810 151 425
About Tate & Lyle:
Tate & Lyle is a global provider of ingredients and solutions to the
food, beverage and other industries, operating from more than 45
production facilities around the world. Through our large-scale,
efficient manufacturing plants, we turn raw materials into distinctive,
high quality ingredients for our customers. Our ingredients and
solutions add taste, texture, nutrition and increased functionality to
products that millions of people around the world use or consume every
day.
Tate & Lyle’s range of leading branded food ingredients includes SPLENDA®
Sucralose, PROMITOR™ Dietary Fiber and STA-LITE® Polydextrose. Tate &
Lyle also produces branded industrial ingredients including Bio-PDO™,
Ethylex® and Sta-Lok® paper starches; and staple ingredients such as
high fructose corn syrup, ethanol, citric acid and basic starches. In
addition to providing a wide range of ingredients our Innovation and
Commercial Development Group supports customers by providing product
development, technical advice and proprietary consumer insight studies.
Tate & Lyle is listed on the London Stock Exchange under the symbol
TATE.L. American Depositary Receipts trade under TATYY. In the year to
31 March 2010, Tate & Lyle employed 5,666 people in its subsidiaries and
joint ventures, and sales totalled £3.6 billion. http://www.tateandlyle.com.
SPLENDA® is a trademark of McNeil Nutritionals, LLC
