Thursday preview: Tate & Lyle reports finals

Tate & Lyle is expected on Thursday to report a decline in full year profits on foreign exchange headwinds as the food ingredients company undergoes a restructuring.

In February’s third quarter trading update, the company said it sees adjusted profit before tax from continuing operations in constant currency “broadly in line” with the previous year at £193m.

However, it said reported pre-tax profits are forecast to fall modestly due to weaker currencies in Brazil and Mexico.

The group also expects to make a loss on its commodities business due to weakness in the US ethanol market.

In the fourth quarter trading update in April, Tate confirmed that the full year outlook remained unchanged.

UBS has forecast full year adjusted pre-tax profit of £195m, compared to the consensus of £190m and last year’s £224m, with revenues pegged to drop to £2.4bn from £2.6bn.

The bank estimates earnings per share of 35p, down from 37.7p in 2015. The dividend is projected to remain at 28p.

Tate is currently overhauling its business to focus on higher-margin speciality food ingredients instead of commoditised bulk ingredients after being hit by a sharp drop in sucralose prices. The company issued three profit warnings in 2014 and 2015.

As part of the restructure, chief executive Javed Ahmed aims to reduce the company’s reliance on a handful of markets and products, including sucralose.

“Medium term, the bull case rests on a rising Speciality Food Ingredients income element due to be aided by expanded new product sales; this will boost the overall margin, will enhance free cash flow and will also lead to a rating more akin to other Food Ingredients concerns such as Kerry Group,” said Numis analyst Charles Pick.

“The problem has been though that Tate & Lyle still keeps on springing surprises and they are rarely positive ones. The dividend is also costing around £130m per annum so it needs to be demonstrated that net debt can be reduced despite paying this.”

Thursday 26 May

INTERIMS
Urban&Civic

INTERIM DIVIDEND PAYMENT DATE
Circle Property , Wetherspoon (J.D.)

INTERIM EX-DIVIDEND DATE
Avingtrans, Britvic, Diploma, Euromoney Institutional Investor, Henderson European Focus Trust, Impax Asset Management Group, Juridica Investments Ltd., Marston's, Matchtech Group, Mitchells & Butlers, Patisserie Holdings , The Renewables Infrastructure Group Limited, Town Centre Securities, UDG Healthcare Public Limited Company

QUARTERLY EX-DIVIDEND DATE
Carnival, HICL Infrastructure Company Ltd

INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Continuing Claims (US) (13:30)
Import Price Index (GER) (07:00)
Initial Jobless Claims (US) (13:30)
Pending Homes Sales (US) (15:00)

FINALS
Lombard Risk Management, QinetiQ Group, Sophos Group , Tate & Lyle, United Utilities Group

ANNUAL REPORT
Cdialogues

SPECIAL DIVIDEND PAYMENT DATE
Foxtons Group

SPECIAL EX-DIVIDEND PAYMENT DATE
JPMorgan Income & Capital Inv Trust

AGMS
Jersey Oil And Gas , Arrow Global Group, Belvoir Lettings, BGEO Group, Celtic, Depa Limited GDR (Reg S), Elecosoft, Faron Pharmaceuticals Oy (DI), Fundsmith Emerging Equities Trust , G4S, Georgia Healthcare Group, Hague and London Oil, Henry Boot, Hostelworld Group , Huntsworth, Ibstock , Immupharma, Inchcape, JSC Acron GDR (Reg S), Keywords Studios, Legal & General Group, Middlefield Canadian Income PCC, Mortgage Advice Bureau (Holdings) , Northbridge Industrial Services, Powerflute Oyj (DI), Rotala, Smart Metering Systems

UK ECONOMIC ANNOUNCEMENTS
GDP (Preliminary) (09:30)
Index of Services (09:30)

FINAL DIVIDEND PAYMENT DATE
Churchill China, Eurocell , Foxtons Group , IndigoVision Group, Informa, Intu Properties, Merchants Trust, Reckitt Benckiser Group, Total Produce

FINAL EX-DIVIDEND DATE
Amec Foster Wheeler, Andrews Sykes Group, Burford Capital , Capital & Counties Properties , DCC, Dillistone Group, Frenkel Topping Group, Hill & Smith Holdings, Huntsworth, IFG Group, Inchcape, Irish Continental Group Units, Manx Telecom , Maven Income & Growth 2 VCT, Menzies(John), Michelmersh Brick Holdings, Mincon Group , Premier Farnell, Soco International, Spectris, STM Group, Tandem Group, Tarsus Group, TLA Worldwide , Venture Life Group, Whitbread, Xaar