Tate & Lyle have combatted rising input prices by increasing their food prices driving which drove group revenue higher by 16% in the three months ended 31st December.
Their Food & Beverage Solutions unit was the standout performer with revenue increasing 19%. Due to the timing of orders earlier this year, the Sucralose unit saw revenue fall 8%, as expected.
Tate & Lyle says they see revenue increasing in the coming year and are confident in maintaining cost discipline. The group says profit will be broadly in line with expectations.
Tate & Lyle shares were 4% higher at 755p at the time of writing.
“Third quarter trading was robust at Tate & Lyle, with double digit revenue growth showing resilient demand in the face of a round of price hikes and broader economic uncertainty. It’s pleasing to see no material growth slowdown in North America, despite ongoing supple chain troubles, and volumes across the Food & Beverage Solutions business look to be holding up despite the higher prices,” said Matt Britzman, Equity Analyst at Hargreaves Lansdown.
We expected a slowdown in sales from the Sucralose division, as Tate pushed orders through the first half of the year – effectively front-loading performance there. The Primient joint venture looks to be benefiting from planned price hikes and we’d expected to see performance continue to improve as we move through the second half and margins recover – it’s good to hear that’s progressing as expected.”
