Tate & Lyle to resume U.S. sucralose production

by Jeff Gelski
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LONDON — Tate & Lyle, P.L.C. plans to restart production at its Splenda sucralose facility in McIntosh, Ala., in the first half of the 2013 fiscal year, the London-based company said May 27 while reporting increased sales and profits for the fiscal year ended March 31. Tate & Lyle in 2009 mothballed the McIntosh facility and began producing all its Splenda sucralose, a high-intensity sweetener, at a Singapore facility.

“The decision to restart production at McIntosh, which was taken following a comprehensive review of alternative options, reinforces our commitment to the sucralose business, provides further resilience in our supply chain and further strengthens our position as the leading global manufacturer and supplier of sucralose,” Tate & Lyle said.

Tate & Lyle will incur about £3 million ($4.9 million) of additional costs in restarting the sucralose facility. The company said it has seen continued growth in demand for Splenda sucralose, not only in more mature markets such as Europe and the United States but also in emerging markets such as Asia and Latin America where obesity and diabetes is becoming more prevalent.

For the fiscal year, Tate & Lyle had sales of £2,720 million ($4,468 million), up 7% from £2,533 million ($4,162 million) in the previous fiscal year, and adjusted operating profit of £321 million ($528 million), up 20% from £268 million ($441 million) in the previous fiscal year. Adjusted operating profit meant before exceptional results of £5 million (2010 — £298 million) and amortization of acquired intangible assets of £13 million (2010 — £14 million).

“In Specialty Food Ingredients, we delivered strong profit growth driven by increased sales volumes across the product portfolio, improved product mix and lower sucralose manufacturing costs,” said Javed Ahmed, chief executive of Tate & Lyle, P.L.C. “In Bulk Ingredients, we experienced good volume growth from sweeteners and very strong returns from co-products due to high corn prices.”

Fiscal-year adjusted operating profit from Specialty Food Ingredients rose 26% to £206 million from £163 million. Fiscal-year sales in Specialty Food Ingredients increased 2% to £805 million from £788 million.

High and volatile sugar prices impacted demand positively for starch-based specialty and high-intensity sweeteners, according to Tate & Lyle. Sucralose’s market share in the high-intensity market increased to 28% from 27%. Splenda sucralose has about a 90% share of the global market for sucralose.

Fiscal-year adjusted operating profit from Bulk Ingredients rose 15% to £157 milliion from £136 million. Fiscal-year sales in Bulk Ingredients rose 10% to £1,915 million from £1,745 million.
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