Treatt PLC Trading Update (2073V)
April 05 2019 - 1:00AM
UK Regulatory
TIDMTET
RNS Number : 2073V
Treatt PLC
05 April 2019
5 April 2019
TREATT PLC
("Treatt" or "the Group")
Trading Update for the half year ended 31 March 2019
Treatt, the manufacturer and supplier of innovative ingredient
solutions for the flavour, fragrance, beverage and consumer product
industries today publishes a trading update for the half year ended
31 March 2019 (the "Period").
The Board is pleased to confirm that following six consecutive
years of growth, the business has continued to perform well in the
current financial year with revenue for the Period up by
approximately 7% compared with the same period in the prior year
(5% in constant currency). The growth in the Period was
particularly pleasing against a market backdrop of price weakness
in some key raw materials for our largest product category, citrus,
which we expect to continue into the second half of the current
financial year.
Whilst citrus continues to dominate our category mix, the fruit
and vegetables, tea and sugar reduction categories are also driving
revenues, representing 69% of the year-on-year growth for the
Period. The vast majority of Treatt's portfolio is targeted at the
growing demand from consumers for more natural and clean-label
products which is feeding both into our results for the Period as
well as our encouraging opportunity pipeline.
A key element of the Group's current five-year strategy through
to 2022 is to invest in the Group's capacity and scientific
capabilities in order to deliver long term growth and value for
shareholders. We are, therefore, pleased to confirm that the $14m
expansion of our US facility was completed in March 2019 and will
become fully operational in June this year. This project has been
managed whilst continuing to deliver the excellent product quality
and service our global client base has come to expect, without
disruption. In the UK, construction of our GBP35m relocation
project is expected to commence this summer, and occupancy to begin
in summer 2020.
Whilst the Group has in place a hedging strategy to try to
ensure that the impact of exchange rate movements is broadly
neutral to the income statement over the course of a financial
year, as has been experienced previously, there can be material
effects over shorter periods of time. During the Period there was a
weakening in the USD/GBP exchange rate and, as a result, the Board
anticipates a net negative FX impact on the results for the Period
of approximately GBP0.6m.
Outlook
We are encouraged by our order book which is comfortably up
compared with the same time in the prior year, notwithstanding the
weakness in some key citrus raw material input prices. This
reflects the success of our continued strategic focus on key
product categories and geographical markets and the Board,
therefore, continues to believe that profit before tax and
exceptional items will be in line with its expectations for the
financial year ending 30 September 2019.
The Board expects to announce Treatt's half year results for the
six months ended 31 March 2019 on 7 May 2019.
Enquiries:
Treatt plc +44 (0)1284 702500
Daemmon Reeve Chief Executive Officer
Richard Hope Chief Financial Officer
Broker
Investec Investment Banking
Patrick Robb +44 (0)20 7597 5970
David Anderson
Alex Wright
Public relations
DRD Partnership
Lawrence Dore +44 (0)20 3951 0349
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.
For further information about the Group, visit
www.treatt.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 news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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