Treatt has lost more than a quarter of its market value as shares in the drinks ingredients firm crashed yesterday following a profits warning.
The group said in a full-year trading update for the 12 months to 30 September that it had continued to face trading headwinds in its second half.
As a result, the business sharply lowered guidance for revenues and profits to between £130m and £135m and £9m and £11m respectively.
Previously, Treatt forecast revenues of between £146m and £153m and pre-tax profits before exceptional costs of £16m to £18m.
Shares nosedived by 25.6% to 188.2p as investors reacted to the update, putting the stock 60% lower so far in the year to date.
Treatt said repeat customer volumes had been hit by competitive pressures and falling consumer confidence in North America, while the weaker US dollar exchange rate resulted in a £500k hit to profits.
The group is also suffering from lower demand as sustained high citrus oil prices affect buying patterns in the sector, leading to drinks makers reformulating products to mitigate costs.
“To mitigate inflationary cost pressures and maintain our investment in growth areas, we implemented several self-help measures in the first half which are continuing, with a focus on simplification and efficiency gains,” the company said in the update.
“Treatt continues to execute its strategy, and we remain committed to driving revenue growth through customer centricity, reach expansion and innovation, as demonstrated by the planned opening of our Shanghai innovation centre later this year. We have also strengthened our senior teams to add new skillsets and a focus on new markets and growth opportunities across the group.
“The sales pipeline has strengthened during the year, and we continue to be focused on revenue opportunities and better margins in FY 2026 and beyond.”
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