Tate & Lyle's Strong Earnings Mask Weak Underlying Growth Momentum

British ingredients producer Tate & Lyle has posted strong growth in profits for the first half of its fiscal year thanks to stronger margins and higher corn prices. For the six months to September, Tate & Lyle's adjusted operating profits increased by 13% in constant currency terms, with the firm aided by shifting the manufacture of its core sucralose brand to a single plant in low-cost Singapore. However, despite the favourable operating environment, sales for the group were flat on a constant currency basis, indicating that restoring top-line growth momentum may be harder than increasing profitability.

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