Tate hit by weaker dollar
TATE & Lyle, the ingredients company and Europe’s biggest sugar refiner, said yesterday the weakness of the US dollar would wipe £11million from its annual profits.
The company derives more than one-third of its sales from America but reports its results in sterling.
Tate’s debts of just over £1billion also raised concerns, while the company said in a trading update that profits for the second half of the year would be broadly similar to the £117million achieved in the first six months. Tate chief executive Iain Ferguson said its US food and ingredients business had performed well but European sugar refineries were operating in a challenging market.
Graham Jones, an analyst at Panmure Gordon, said Tate’s debts were much higher than he had anticipated last year.
He reckoned more than £100million had left the business because of higher commodity prices.
Tate has been slowly rebuilding investor confidence after three profit warnings last year — a result of high corn prices and slower growth in its Splenda business.