Treatt savours solid 2019 as profit rises despite citrus price fall
Treatt, which manufactures flavour and fragrance ingredients for the beverage and consumer product industries, defied a collapse in the price of citrus oil to post a seventh consecutive year of profit growth.
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The figures
Profit at the group rose 5.2 per cent for the year, up to £13.3m from £12.6m in 2018.
Revenue also rose 0.5 per cent, from £112.2m to £112.7m.
The group announced a dividend of 5.5p, a 7.8 per cent increase on 2018’s 5.1p.
Treatt’s total net cash position improved by £5.9m to £16m, with free cash flow of £7.8m.
Why it’s interesting
Treatt’s performance was particularly impressive in light of the sharp fall in the price of citrus oil, the company’s largest product category.
The company said that it’s diversification strategy had been vindicated by the results, which saw a seventh consecutive year of profit growth.
Accelerating growth rates in tea, and especially in iced tea, as consumers continue to opt for healthier beverages, drove demand for the company’s low calorie solutions.
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The company also expanded its US facility, adding significant manufacturing capacity, and began construction on a new UK facility as it looks to continue its growth.
What Treatt said
Chief executive Daemmon Reeve said:
“I am pleased to report that the group delivered solid results for the year. The strength of our strategy shone through strongly as we increased our profitability in the face of citrus market headwinds.
“To have decoupled our financial performance from external market factors which were once a dominant feature of Treatt’s financial performance augers well for our future.
“We are driving ahead with confidence and whilst it is still early in the new financial year, the group continues to perform in line with the board’s expectations for the year ending 30 September 2020.”