Tate & Lyle has reported weaker than expected sucralose volumes in the third quarter, as stevia takes market share in the table-top sweetener market.
The food ingredients giant said it expected volumes of sucralose, which accounts for about 20% of profits, to be lower this year.
“The issue appear to be market share challenges in European table-top, where sucralose will be competing with stevia and others,” said Investec analyst Martin Deboo.
Tate & Lyle said group adjusted profit before tax in the quarter was broadly in line with expectations.
It estimated that the alfatoxin fungus, which hit the US corn harvest last year due to the hot and dry weather, would reduce operating profits by £7m for the full year. On a more positive note, the company said it had completed its US pricing round with slightly increased margins.
The guidance on profits before tax was trimmed from ‘progress’ to ‘modest progress’. Shares in the group dropped 3% to 786p in early trading on Friday.