At Tate & Lyle PLC (LSE:TATE) interim results in early November, investors will be focused on demand headwinds in the US and how management plans to get growth back on track, Deutsche Bank predicted, after downgrading its rating after a recent profit warning.
Following the ingredient maker's pre-close statement, analyst Damian McNeela forecast first-half group sales of £1.01 billion, down 6.9%, which is now in line with the City consensus, due to an end-market slowdown.
Adjusted EBITDA is expected to decrease 11.8% to £209 million, driven by top-line softness and the weighting of cost synergies into the second half, implying a margin contraction of around 120 basis points.
DB's forecast for adjusted diluted EPS is 19.7p, below the consensus estimate of 20.3p.
McNeela expect investors to focus on demand dynamics across key regions, especially North America, as well as the effectiveness of new growth initiatives and the realisation of cost synergies from the CP Kelco acquisition.
They will also be interested to hear about management's plans to ensure Tate & Lyle gets back on track to meet its medium-term financial growth objectives; and how they might navigate and adapt to evolving market trends, including the impact of GLP-1 weight-loss drug usage.