Making ‘tastier food healthier and healthy food tastier’: Tate & Lyle CEO sees purpose driving growth

By Katy Askew contact

- Last updated on GMT

Tate and Lyle puts purpose at the centre of its strategy © iStock/studi-annika
Tate and Lyle puts purpose at the centre of its strategy © iStock/studi-annika
Ingredients manufacturer Tate & Lyle is riding the reformulation wave, with its business boosted by sugar-reduction and clean label trends. CEO Nick Hampton says the company is benefitting from its sense of purpose: “We use our ingredients and expertise to help make tastier food healthier and healthy food tastier.”

Tate & Lyle booked a 4% rise in adjusted full-year profits last week, which rose to £309 million as a strong performance from its food & beverage solutions division offset “challenging market conditions”​ within its primary products segment. Sales were up 2% to £2.76 billion.

CEO Nick Hampton said that the company is seeing a positive performance because it is operating with a sense of purpose, which resonates with customers and has become a “very powerful motivator for our people”​.

Tate & Lyle FY in numbers 

Fiscal 2018/19 to 31 March:

  • Sales - £2,755m, up 2% YOY
  • Profit before tax - £309m, up 4% YOY
  • Diluted EPS - 52 pence, up 4%

He said Tate’s “purpose and profits”​ are “working in harmony”​. For instance, over the last four years, the ingredient supplier’s fibres have helped its customers take the equivalent of 170 billion calories out of products, Hampton revealed.

“Over the last 26 years, sucralose has removed the equivalent of 85 trillion calories,”​ he continued.

Speaking during a conference call with analysts, the chief executive also flagged less obvious ways Tate is able to build sustainability into its model. Through its Bio-PDO product, manufactured by our joint venture with DuPont, the company helping Rebook make more sustainably sourced sneakers with soles made from corn, he noted.

F&B solutions play to global trends: sugar reduction and clean label

Tate’s F&B solutions business resonates with a number of global mega-trends that are propelling innovation in the sector.

“The rise in diseases like diabetes and obesity is encouraging people to seek healthy alternatives from their food and drink. Consumers are also demanding greater transparency with cleaner labels and more natural ingredients, and the increasing vegan and flexitarian diet is driving demand for more plant-based options. And of course, people continue to reduce the amount of sugar in their diets,​” Hampton noted.

“All these trends present significant opportunities for food & beverage solutions. The combination of our deep understanding of sweetness, texture and fibre enrichment, together with our expertise in key categories, mean we can tell a unique solutions for our customers.”

He said that sugar and calorie reduction remain a “key opportunity”​ and revealed that these projects represent about one-third of the firm’s customer pipeline. Interestingly, Hampton noted, an “increasing number”​ of these projects leverage fibre for reformulation.

This approach “not only allow the amount of sugar to be lowered, but also provide nutritional benefits, such as digestive health, low glycemic response and calcium absorption, all without impacting taste”​.

Stevia © Getty Images - HandmadePictures
Tate & Lyle has seen a big jump in stevia volumes ©Getty Images / HandmadePictures

Tate and Lyle’s fibre business has seen a CAGR of 15% globally over the past two years – and this trajectory rises to 30% in faster-growing emerging markets.

The company's stevia business is also witnessing strong growth. The company has been able to leverage its relationship with Sweet Green Fields - in which Tate acquired a 15% shareholding last year - to expand sales. "The combination of our stevia portfolios and solutions expertise has given us a significantly expanded customer offering, driving a 78% increase in stevia volume last year,"​ Hampton said. 

Clean label natural ingredients are another area where Tate & Lyle’s portfolio and technical expertise leave the group “well-placed”​ to meet growing consumer demand.

“People increasingly want to understand the ingredients on food and drink labels. They want to know where their food comes from, and they're increasingly choosing products they feel are less processed or simpler. This is shown by the healthy growth rates for clean label products across the world. A range of Claria clean label starches and non-GMO starches had seen strong growth over the last 2 years in response to this trend, achieving compound annual growth rates of 57% and 28%, respectively,”​ Hampton revealed.

Building customer relationships: Mondelez case study

Tate & Lyle has been working to leverage these trends by strengthening its relationship with customers at all levels of the business.

According to the company, one of its key priorities is “sharpening”​ the focus on customers and over the past year the number of calls and face-to-face meetings held at all levels of the company has increased 39%.

Cadbury Dairy Milk
30% lower sugar Cadbury will roll out in the UK this summer

Hampton said that the group is working to develop long-term relationships and build on existing partnerships. Tate’s relationship with confectionery group Mondelez international is a good example of how effective this approach can be.

“Over two years ago, we started a conversation with the head of R&D at Mondelez about sugar reduction, out of which came a project to work with them to develop a reduced sugar version of their iconic Cadbury Dairy Milk chocolate bar without compromising taste.

“Working closely across sales, applications and R&D, we were able to support them in finding the right solutions based on a Promitor fibre and reduced the bar's sugar content by 30%. This product will launch in the UK this summer.

“As a result of this, our relationship with Mondelez has grown stronger. We are now working on more projects across the world, building a growth partnership together.”

Related topics: Business

Related news

Show more

Follow us

Products

View more

Webinars