Tate & Lyle plc

Good morning and welcome to the conference call for Tate & Lyle's Q3 trading statement. Your speakers today are Nick Hampton, Chief Executive, and Sarah Carlyle, Chief Financial Officer. I will now hand you over to Nick Hampton for some opening remarks.

Thank you, Operator. Good morning, everyone, and welcome to Tate & Lyle's third quarter conference call. I will make some introductory comments, and then Sarah and I will be happy to take your questions. The group delivered another quarter of solid operating performance, with volume and EBITDA growth. We also saw strong productivity and cash delivery. In November, we completed the acquisition of CP Calco, a leading global pexin and speciality gum business. This acquisition represents a significant acceleration in the delivery of agro-focused strategies. It establishes Tate & Lyle as a leader in mouthfeel, a critical driver of customer solutions, and we are encouraged by the positive response of customers to the benefits of our expanded portfolio and solutions capabilities. Looking in more detail at our performance in the quarter, volume in food and beverage solutions was 4% higher, with growth in each region. Revenue was 4% lower, primarily reflecting the pass-through of input cost deflation. Sucralose performed strongly, benefiting from the continued impact of the pull forward of customer orders, which we expect will partly unwind in the fourth quarter. CP Calco performed well and in line with our expectations, delivering strong volume growth in the 2024 calendar year and delivering the anticipated progress on the phased margin recovery we outlined at the time of the acquisition. The integration of the two businesses is progressing well. and we will operate as one business from the 1st of April. Our progress since we closed the deal reinforced our confidence in delivering the targeted run rate cost synergies of $50 million by the end of the 2027 financial year, as well as the identified revenue synergies over the medium term. In line with the normal cycle of our industry, during the quarter, we renewed contracts to 2025 calendar year for those customers who contract annually. While market demand remains broadly stable, we have not yet seen the acceleration in demand we expected in the second half of the 2025 financial year. Against this background, continued geopolitical uncertainties and some pricing pressure, we renewed contracts for both Tate and Lyle and CP Calco, which are expected to deliver volume and revenue growth in the 2025 calendar year. Turning now to the outlook for the year ending 31st of March 2025. Excluding CP Calco and in constant currency, we now expect revenue to be mid-single-digit percent lower and for EBITDA growth to be towards the lower end of our guidance range of 4% to 7%. Overall, the business continued to perform well. The muted consumer demand environment and ongoing geopolitical uncertainties reinforce the importance of the steps we have taken to reposition patent law over the last six years. Looking ahead, the combination with CC Calco significantly strengthens our customer offering, expands our reformulation capabilities, and further increases our ability to benefit from the structural long-term trends towards healthier, tastier, and more sustainable food and drink. With that, I will open up the call for questions.

Thank you, Mr. Hampton. In order to ask a question or make a contribution to this call, please press star 1 on your telephone keypad. If you change your mind and want to withdraw your question, please press star 2. Please ensure your lines are unmuted locally as you'll be prompted when to ask your question. The first question comes from a line of Patrick Higgins from Goodbody. Please go ahead.