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Treatt numbers still in ‘lime’ with expectations despite weak citrus prices

The price of orange oil, which contributes to 33% of the group’s revenue, fell by over 50%, while lemon price also showed “substantial weakness”

Treatt  plc - Treatt numbers still in ‘lime’ with expectations despite weak citrus prices
Treatt said it will focus on the non-citrus portfolio for its growth

Treatt PLC (LON:TET) said weak citrus prices are unlikely to pick up but the essential oils and ingredients supplier still expects results for the year to be in “lime” with expectations.

The fully listed group performed well in the second half despite foreign exchange headwinds and a “very significant” fall in key citrus raw material prices.

READ: Treatt expects full-year profits to be in line despite forex fluctuations and weak citrus prices

Treatt said it will focus on the non-citrus portfolio for its growth, including the recent entry in the cold brew coffee market.

The ingredient manufacturer expanded its US facility in Florida to double capacity of the natural tea, health & wellness and fruit & vegetable categories, and is expecting the investment to prove worthwhile in the coming months.

The price of orange oil, which contributes to 33% of the group’s revenue, fell by over 50%, while lemon price also showed “substantial weakness”.

Revenue from the citrus category, which makes up 54% of the total, fell by 10%, offset by a 16% growth in non-citrus areas.

The revenue for the year ended 30 September is expected to be £112.7mln, an increase of 1% (or a decrease of 2% in constant currency) year-on-year.

Net cash balance was £15.8mln, after a net inflow to £5.8mln.

Shares were down 1.95% to 402p.

Quick facts: Treatt plc

Price: 514 GBX

LSE:TET
Market: LSE
Market Cap: £309.28 m
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