Tate & Lyle (LON:TATE) said its full-year results were in line with revised guidance, as muted market demand and regional weakness offset progress from the integration of CP Kelco and ongoing productivity efforts.
Opening the results presentation for the year ended March 31, 2026, Nick said the company could not comment beyond last week’s Rule 2.4 announcement under the U.K. Takeover Code, which confirmed that Ingredion had made a conditional proposal to acquire Tate & Lyle. He said there was “no certainty that any offer will be made, nor as to the terms of such an offer,” and that the presentation would focus on the company’s results and business progress.
Nick said the integration of CP Kelco had been “successfully completed” without customer disruption, despite softer-than-expected market demand and geopolitical complexity, including tariffs. However, he described the company’s financial performance as “disappointing” and said Tate & Lyle’s top priority for the new financial year is volume-led top-line growth.
Revenue and EBITDA decline on pro forma basis
Sarah said statutory revenue rose 16% and adjusted EBITDA rose 13%, including the impact of the CP Kelco acquisition in November 2024. On an adjusted, like-for-like pro forma basis, however, revenue fell 3% and adjusted EBITDA declined 3% to £415 million, in line with the guidance the company issued in October.
Adjusted profit before tax fell 5% to £238 million, while adjusted earnings per share were £0.404 on a reported basis. Free cash flow was £164 million, with cash conversion of 70%, slightly below the company’s target.
Sarah said the revenue decline reflected a £34 million impact from volume and mix and a £33 million investment in pricing. She said around 20% of the revenue decline came from the company’s bulk sweetener business in Europe, while softness in Latin American sweeteners, particularly in Mexico, accounted for a further 30%.
“Despite a challenging year, we saw solid performance in our largest market of North America, encouraging performance in Asia Pacific, despite the impact of tariffs,” Sarah said. She added that around two-thirds of the portfolio continued to grow.
Regional performance mixed
In the Americas, revenue fell 3% and EBITDA declined 4%, with lower volume offsetting broadly flat pricing. Sarah said the underperformance was concentrated in Latin American sweeteners, while U.S. revenue was stable despite muted market demand in beverage, bakery and snacks.
In Europe, Middle East and Africa, revenue decreased 5% and EBITDA fell 6%. Volume was flat, but pricing was lower following the company’s decision to invest price back into the market in 2025 calendar-year customer framework agreements. Sarah said bulk sweeteners in Europe were the main driver of the regional revenue decline, largely due to lower sugar pricing.
Asia Pacific was a relative bright spot, with revenue broadly in line and EBITDA up 9%. Sarah said North Asia continued to grow well, while China was flat amid a challenging tariff environment since July 2025.
Dividend held flat as cash flow declines
The board recommended a final dividend of £0.132 per share, bringing the full-year dividend to £0.198, in line with the prior year. Sarah said the board remains committed to a progressive dividend policy, growing the dividend when earnings allow and holding it in other periods.
Free cash flow was £26 million lower than the prior year. Sarah said working capital was affected by higher inventory to mitigate tariff impacts and support customer supply continuity while the company manages consolidation of bio-gum capacity. Receivables also increased due to extensions in some customer framework agreement terms to support the company’s volume-led growth priority.
Net debt at March 31 was £939 million, down £22 million, and leverage stood at 2.3 times net debt to EBITDA. Sarah said Tate & Lyle continues to target long-term leverage of 1 to 2.5 times. The company has access to nearly £1 billion through cash and an £800 million committed undrawn revolving credit facility, which has been extended to 2031.
CP Kelco synergies ahead of plan
Nick said Tate & Lyle is focused on four strategic priorities: targeted investment to accelerate customer wins, delivering the benefits of the CP Kelco combination, accelerating productivity and strengthening the balance sheet while delivering shareholder returns.
The company is targeting revenue synergies equal to 10% of CP Kelco’s revenue, or about $70 million, by the end of the 2029 financial year. Nick said about 10% of that target has been delivered so far, and the cross-selling pipeline more than doubled in the second half to more than $100 million.
Sarah said Tate & Lyle delivered £24 million of cost synergies last year and has already reached its targeted £50 million annualized run-rate cost synergy goal one year ahead of plan. The company also delivered £53 million in productivity savings during the year, bringing total productivity savings over the last three years to £144 million.
However, Sarah said a planned consolidation of bio-gums production capacity has been rescheduled. The company had expected a financial benefit of about £20 million in the 2027 financial year, but now expects that benefit in the 2028 financial year.
Outlook calls for modest revenue growth
For the year ending March 31, 2027, Tate & Lyle said it expects modest revenue growth on a constant currency basis, underpinned by volume growth weighted toward the second half. The company expects broadly flat EBITDA before the impact of the rescheduled bio-gums consolidation.
Nick said the outlook assumes a limited impact from the conflict in the Middle East. During the question-and-answer session, he said the company has limited exposure to the affected countries, representing about 1% of revenue, and is using alternative shipping routes where necessary.
Asked about confidence in a volume recovery, Nick said the company saw good revenue growth in April and expects momentum to build as sales teams focus on target customers, cross-selling expands and tariff impacts become part of the comparison base. He said the combined portfolio is gaining traction with customers, particularly in sweetening, mouthfeel and fortification.
“The power of the combination really is starting to gain traction with customers,” Nick said, adding that the company remains focused on execution, top-line growth and improving performance.
About Tate & Lyle (LON:TATE)
Tate & Lyle PLC, together with its subsidiaries, provides ingredients and solutions to the food, beverage, and other industries in the United States, the United Kingdom, other European countries, and internationally. It operates through three segments: Food & Beverage Solutions, Sucralose, and Primary Products. The company offers dairy products, soups, sauces, and dressings; bakery products and snacks; texturants; nutritive sweeteners, such as high fructose corn syrup and dextrose; fibres; and stabilizers and functional systems.
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