Coronavirus Update

Treatt Plc - Half year/Interim Report

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TREATT PLC

HALF YEAR RESULTS

SIX MONTHS ENDED 31 MARCH 2020

Treatt Plc (the 'Group'), the manufacturer and supplier of innovative ingredient solutions for the beverage, flavour, fragrance and consumer products industries, announces its half year results for the six months ended 31 March 2020.

FINANCIAL HIGHLIGHTS1:

 

Half year ended

31 March 2020

Half year ended

31 March 20192

Change

Revenue

£53.6m

£56.6m

-5.3%

Gross profit margin

26.2%

25.0%

+120bps

Operating profit

£6.1m

£6.3m

-3.9%

Profit before tax and exceptional items

£6.1m

£6.2m

-2.0%

Adjusted basic earnings per share

8.08p

8.35p

-3.2%

Dividend per share

1.84p

1.70p

+8.2%

OPERATIONAL HIGHLIGHTS:

  • COVID-19 has had no adverse impact on trading performance to date.
  • Fruit & vegetables, tea and health & wellness (including sugar reduction) categories have again performed strongly.
  • Citrus core product category impacted by prior year fall in raw material prices as expected.

Ongoing investment in the Group's capacity to deliver long-term growth

  • US expansion: doubled capacity for high growth categories - on stream for spring crops.
  • UK site relocation well underway, move delayed until 2021 due to COVID-19 lockdown.

Commenting on the results, Group CEO, Daemmon Reeve, said:

"In these exceptional and unexpected times I am pleased to report further encouraging progress for the Group. The anticipated weakness of some citrus raw material markets impacted H1 numbers as expected, but H2 is likely to witness an improvement in this category. Once again, the growth in higher margin tea, health & wellness and fruit & vegetables categories continue to make healthy progress in line with the growth in consumer demand for 'better-for-you' premium beverages.

"A particular mention of thanks to our dedicated and talented team at Treatt who have adapted admirably through the very challenging times of the last few months and to whom huge praise is due for the fantastic job they continue do for the business. 

"Looking ahead it is difficult to determine the likely impact of COVID-19 on the demand for the Group's products and there may be a slowdown in some of our customers' new product development activities in the short term, reflecting the dramatic changes in consumption habits. However, the Group has traded well since the half-year end and is encouraged by the level of its order book and the current demand for its products from beverage ingredients through to solutions for hand soaps and cleaning products. Therefore, whilst there remains much to do, the Board is pleased to report that, at this time, trading remains in line with its expectations for the financial year ending 30 September 2020."