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Drinks ingredients supplier Treatt has reported continued momentum as the beverage industry returns to more normal seasonal patterns following the end of lockdowns.
Revenues at the group increased 9% to £66.3m in the first half to 31 March, driven by its expertise in citrus, its largest category, Treatt said in a trading update.
Following an “unusually” strong first half a year ago that was boosted by the shift from the on to the off-trade during the pandemic, the current financial year returned to the usual pring/summer beverage consumption seasonality, with margins and profits expected to be weighted towards the second half.
Treatt added that while good progress continued in its higher margin healthier living categories of tea, health & wellness and fruit & vegetables, materially stronger performance was expected from these categories in final six months of the year.
It pointed to a more than 15% rise in its order book, with a strong pipeline in the healthier living, citrus and coffee categories.
The group continued to win new business with both new and existing customers through direct sales to global and local fmcg brands, as well as indirectly through the flavour and fragrance houses.
CEO Daemmon Reeve said: “After a record performance for the business last year, we’ve continued the momentum into the first half with a good sales performance, particularly driven by our largest category, citrus, where we have grown a number of longstanding relationships working with some of the biggest beverage companies.
“This year’s performance is expected to reflect a reversion to more normalised beverage trends and overall trading continues in line with the board’s expectations. Despite the wider macro uncertainties, our second half pipeline is strong, we are bringing more of our new UK site into operation and we are seeing good opportunities across a number of categories, so remain confident for the future.”
Shares in Treatt rose 0.9% to 1,168p as markets opened this morning.
Morning update
The FTSE 100 opened the week in the red, down 0.3% to 7,650.26pts in the early going.
McColl’s Retail Group fell back 7.1% to 3p after surging late last week, while Deliveroo and Just Eat Takeaway fell 3.9% to 109.9p and 3.1% to 2,597.5p respectively, and THG is down 2.8% to 89.2p so far.
Early risers included McBride, AG Barr, Sainsbury’s and Bakkavor, up 5.6% to 39p, 3.2% to 557p, 2.6% to 252.9p and 2.5% to 113.8p respectively.
This week in the City
There are a handful of big updates set for this week as the City prepares for the long Easter weekend.
Tomorrow brings a trading update from Deliveroo and the latest retail sales data for March from the British Retail Consortium and KPMG.
Tesco releases its full-year results on Wednesday.
And, embattled ecommerce group THG publishes its preliminaries on Thursday
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