Treatt boosts profits and revenues and sells plantations subsidiary
Ingredient solutions maker Treatt plc has increased interim profits by more than 20 per cent and sold its Earthoil Plantations subsidiary to a UK business for £11 million cash.
Treatt’s results to March 31 justify the Bury St Edmunds company’s selection as Business Weekly’s Business of the Year in that month. The company supplies ingredient solutions for the flavour, fragrance, beverage and consumer products industries.
Interim revenue was 13.7 per cent higher at £53.6m and adjusted PBT 20.4 per cent up at £5.8m.
CEO Daemmon Reeve (pictured above) said Treatt had made an encouraging start to its new five-year strategy. He said: “Following the exceptional performance of the group in 2017 it is very encouraging to again be reporting both strong revenue and profit growth for the half year. Our strategy continues to deliver with the main business drivers of citrus, tea and sugar reduction performing well in the period.
“Whilst there is still much to do to complete the year, and movements in exchange rates or raw material prices can impact results, the board is currently confident that the group will meet its expectations for the financial year ending September 30.”
Treatt has also announced the conditional sale of Earthoil Plantations, a wholly owned subsidiary, which specialises in the supply of pure, organic, fair trade essential and cold pressed vegetable seed oils for the personal care and cosmetic industries, to Univar Limited for £11m cash. The deal should complete by May 31. The sale does not include the Kenyan subsidiaries which will continue to supply Earthoil Plantations under a three-year supply agreement.
Transitional services arrangements with Earthoil Plantations have also been agreed for an initial limited period of up to six months from completion. Treatt intends to use the proceeds to strengthen its balance sheet, increasing debt capacity for future growth and investment in the group’s key product categories.
Reeve said: “As Treatt continues to grow and we embark on our revised 2022 strategy, Earthoil Plantations has become non-core to the group. This sale will allow us to focus our efforts and resources on developing our business in the global supply of innovative ingredient solutions to the flavour, fragrance, beverage and consumer product industries.”