TATE & LYLE posted a drop in profit and forecast a further weakening in the new year, as the food ingredients firm feels the chill from a cold winter in the United States and stiff competition for its sucralose.
The historic company, which sells a range of sweeteners including sucralose under the Splenda brand, said in February that sucralose prices would be about 15 per cent lower in the new fiscal year.
That was due to an influx of cheaper Chinese rivals and a glut of unsold inventory there.
Tate & Lyle has had to renegotiate contracts at lower prices in order to maintain market share.
At the same time, the company’s corn syrup business has been dented by an unusually long and bitter winter in the United States that hurt sales of its customers’ soft drinks.
In the fiscal year ended March 31, Tate & Lyle said adjusted operating profit before tax was £322m, down 2 per cent from the prior year.
Excluding the impact of currency fluctuations, it was flat.
Sales fell 3 per cent to £3.15bn.
Last month the company said it expected flat full-year earnings following a disappointing third quarter that led it to cut its forecast, hitting its share price.
Tate & Lyle’s shares have fallen 17 per cent so far this year.