Bury St Edmunds: Treatt hails success of new strategy as first-half profits grow by 29%
- Credit: Archant
FLAVOUR, fragrance and consumer goods ingredients company Treatt, today hailed “early signs of success” for its change of strategy as it posted increased first-half profits.
Bury St Edmunds-based Treatt reported a pre-tax profit of £2.008million for the six months to March 31, up 29% from £1.556m at the same stage last year
The increase in earnings was achieved despite a dip in revenue, from £36.026m in last year’s first half to £33.572m, with lower turnover in Europe, the Americas and the Rest of the World segments offsetting an increase in UK sales.
Earnings per share increased by 40% to 14.1p, from 10.1p last year, and the interim dividend will rise by 8% to 5.5p per share, from 5.1p a year ago.
Group chief executive Daemmon Reeve said: “It has been an exciting and busy six months for the business, and these results are a reflection that this effort and focus is translating into profits.
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“We could not do this without the great team we have across all our operations. Treatt is well positioned to take advantage of the many opportunities ahead of us.”
Company chairman Tim Jones added: “The first half year has seen the group’s new strategic focus under the leadership of Daemmon Reeve bearing fruit.
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“The strategy focuses the group’s efforts, resources and capital on achieving a leading position as an ingredient solutions provider to the flavour, fragrance and consumer goods industries with a particular emphasis on the beverage market.
“This both builds on our core strengths and relationships and also provides a focus for managing the group’s resources and activities going forward.”
Treatt, which has manufacturing bases in the UK, the United States and Kenya, said volumes in the first six months of the year were up by 33%, with plant utilisation at high levels.
Sales of tea and citrus ingredients were performing particularly well and the new strategy was enabling the group to win new business with large multi-national consumer goods corporations across a wide range of new and existing ingredient solutions.
In addition, revenue derived from the Earthoil-branded range of organic and fair trade cosmetic ingredients continues to grow “at a steady pace”.
Looking ahead, Mr Jones added that the group was “building up a good level of momentum” in the third quarter, with strong sales and order books up “significantly” on a year ago with the increased focus on multi-national companies continuing to feed through.
The second half of the year was also expected to benefit from both a continual improvement in margins as well as from further cost saving initiatives coming to fruition. As a result, the board remained confident that results for the full year would meet its expectations, he added.