Tate & Lyle share price plummets following profit warning
Tate & Lyle's share price has plummeted 17 per cent in early trading after company sliced its profit outlook for the year.
It's a bitter pill to swallow for the foods group, whose Splenda sweetening business is struggling with intense competition and falling prices of sucrose.
The company's expected profit for the year had been set at £327m, but that has been cut down to between £230m and £245m after a half-year the company described as "very challenging".
Splenda was hit badly by a severe American winter causing operational difficulties in US corn plants, as well as the extended shutdown of a facility in Singapore.
The drop in the company's share price, to 601 pence, represents its lowest point in three years.
(Source: Yahoo)
Tate & Lyle CEO Javed Ahmed said:
The group’s performance in the first half has been extremely disappointing as we have faced significant manufacturing and supply chain challenges, and intense competition in Splenda Sucralose.I have instigated an immediate review of our planning and supply chain processes, led by our chief financial officer, to ensure they fully reflect the needs of the business going forward.
This is the second time the agribusiness' share price has taken a big kicking this year. The company was also forced to issue a profit warning in February, again due to the struggles of Splenda, which caused its share price to drop 16 per cent.