Treatt PLC Trading Statement (6079X)
February 23 2017 - 1:00AM
UK Regulatory
TIDMTET
RNS Number : 6079X
Treatt PLC
23 February 2017
23 February 2017
TREATT PLC
Trading Update for year ending 30 September 2017
Treatt Plc (the 'Group'), the manufacturer and supplier of
innovative ingredient solutions for the flavour, fragrance,
beverage and consumer product industries today publishes a trading
update for its financial year ending 30 September 2017.
Following the AGM trading update published on 27 January 2017,
the Board is pleased to confirm that momentum has gathered pace,
with the results for the six months ending 31 March 2017 ('Half
Year') now expected to show substantial progress compared with the
prior year. This has resulted from a combination of strong growth
to revenues (currently estimated to be up in excess of 20% over the
comparable period last year) driven by both new business wins and
growth with existing customers, combined with improved product
margins as we continue to add value by moving up the value
chain.
All of our key product categories have delivered strong revenue
growth since the start of the financial year, with citrus and sugar
reduction solutions producing particularly strong performances.
Earthoil, the Group's personal care ingredients division, also
continues to perform well as recent investments begin to deliver
returns. As we enter the seasonally busiest time of the financial
year, it is encouraging to see order books for the remainder of the
current financial year, and into next year, across the Group
materially up on a year ago.
The Group's strategy to manage foreign exchange risk is designed
to prevent currency from having a material impact on the net
results. During the period, the GB Pound/US Dollar exchange rate
has been relatively stable and, therefore, the expected reversal of
last year's FX loss of GBP0.5m should positively impact on the
results for the Half Year. This includes the retranslation benefits
from the Group's US subsidiary Treatt USA.
The strength of the Group's order book and the impact of higher
raw material prices, has resulted in an expected increase to net
debt which is expected to be approximately GBP10m-GBP12m at the
Half Year compared with GBP8.4m at the same time last year.
Nonetheless, with confidence for the usual pattern of strong cash
inflow in the second half of the year, it is expected that overall
net debt will fall significantly by our financial year end.
Plans for the relocation of the Group's UK site continue to
progress well. As previously announced, contracts were exchanged in
December 2016 (subject to outline planning consent) on a 10 acre
plot of land on the new Suffolk Business Park in Bury St.
Edmunds.
Outlook
With the continuing momentum being delivered by our 2020
Strategic Plan, strong revenue growth, and the beneficial impact
from higher product margins, the Board now believes that profit
before tax for the financial year ending 30 September 2017 will
substantially exceed its previous expectations.
Treatt's Half Year results will be announced on 9 May 2017.
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
Enquiries:
Treatt plc +44 (0)1284 702500
Daemmon Reeve Chief Executive Officer
Richard Hope Finance Director
Broker
Investec Investment Banking
Patrick Robb +44 (0)20 7597 4000
David Anderson
Alex Wright
Public relations
Davidson Ryan Dore
Lawrence Dore +44 (0)20 7520 9218
About the Group
Treatt is a global, independent supplier of innovative
ingredient solutions for the flavour, fragrance and multinational
consumer product industries, particularly in the beverage sector.
Renowned for its technical expertise and knowledge of ingredients,
their origins and market conditions, Treatt is recognised as a
leader in its field.
The Group employs over 300 staff in Europe, North America,
Africa and Asia and has manufacturing facilities in the UK, USA and
Kenya. Its international foot print enables the Group to deliver
powerful and integrated solutions for the food, beverage and
fragrance industries across the globe.
Earthoil is the personal care ingredients division of Treatt,
which specialises in pure and organic fair trade essential and cold
pressed vegetable seed oils, offering a broad spectrum of natural
raw materials for cosmetic applications.
For further information about the Group, visit www.treatt.com
and www.earthoil.com.
CAUTIONARY STATEMENT ABOUT FORWARD-LOOKING STATEMENTS
This announcement contains forward-looking statements that are
subject to risk factors associated with, among other things, the
economic and business circumstances occurring from time to time in
the countries, sectors and markets in which the Group operates. It
is believed that the expectations reflected in these statements are
reasonable but they may be affected by a wide range of variables
which could cause actual results to differ materially from those
currently anticipated. No assurances can be given that the
forward-looking statements in this announcement will be realised.
The forward-looking statements reflect the knowledge and
information available at the date of preparation of this
announcement and the Group undertakes no obligation to update these
forward-looking statements. Nothing in this announcement should be
construed as a profit forecast.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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