Treatt Plc · LSE:TET
Treatt — H1 2024 Earnings Presentation
23 slides from Treatt's earnings presentation, May 2024
Slide 1: For the Six Months ended 31 March 2024
For the Six Months ended 31 March 2024 Interim Chief Executive Officer Interim Chief Financial Officer
Slide 2: Q1 impacted by destocking, Q2 growth of 5%
Q1 impacted by destocking, Q2 growth of 5% strengthening with greater industry experience growth of 4%, with good cost disciplines strategy delivering tangible results Q2 exit rate strong with healthy order book 2
Slide 3: +120BPS -40BPS
-5.1% -40BPS +4.5% +120BPS +2.0% 3
Slide 4: Single digit growth, high single digit growth, double digit growth
Single digit growth High single digit growth Double digit growth 4
Slide 5: Citrus: Q1 impacted by destocking, Q2 growth of 5%
• Q1 impacted by destocking, Q2 growth of 5% • Natural citrus substitutes launched in response to high raw material prices • Destocking softening most prevalent in synthetic aromas • Deeper technical presence at industry trade events • Continued focus on strategic sourcing and improved operational u
Slide 6: Tea: exciting growth of 7%
• Exciting growth of 7% • Premium beverage market resilient with natural, better-for-you positioning increasingly important • Innovation customer collaboration driving new Tea wins • US R&D plant investment to triple premium trials • Premium is typically H2 weighted in North America, with tangible p
Slide 7: Local sales +28%, with four national brand wins
• Local sales +28%, with four national brand wins • Operational capabilities enhanced with local partnerships • Decline in coffee sales offset with margin improvement • Strong focus on customer diversification in coffee pipeline • Launch of new product range with global marketing campaign • Scale up
Slide 8: Treatt Zest
TREATTZEST” HIGHLY CONCENTRATED INTENSE IMPACT PROVEN PERFORMANCE
Slide 9: Financial Review
FINANCIAL REVIEW uv TREATT
Slide 10: Financial results for the half year
Revenue Gross profit Gross profit margin Administrative expenses(1) mid single digit decline as expected driven by Adjusted Operating profit(1) heritage and coffee decline in H1 Adjusted Operating profit margin(1) Net finance costs Adjusted profit before tax (1) broadly in line, expected to increase
Slide 11: Capex and investment over the last twelve months
(£0.5m) (£5.0m) over the last twelve months (£4.9m) despite high raw material prices (£3.3m) (£10.3m) (£17.7m) £21.1m at normalised levels to ensure operational capacity meets future demand 12
Slide 12: Priorities for growth and outlook
• Gain of wallet share • Margin improvement, • Maintaining cost • Normalised capex spend with existing customers through operational discipline appropriately - targeting operational efficiencies scaled for growth efficiencies and • Pipeline conversion - investment for growth customer focussed • Stra
Slide 13: Outlook: continued focus on delivery of growth plans
as destocking softens and sales pipeline giving confidence driving new business wins continued focus on delivery of growth plans in line with board expectation Treatt UK tasting and sensory lab 14
Slide 14: Appendix
Slide 15: Forward looking statements disclaimer
This presentation contains forward looking statements which are made based on the information available at the time of its publication. It is believed that the expectations reflected in these statements are reasonable, but they may be affected by risks and uncertainties that are inherent in any forw
Slide 16: Slide 16
Slide 17: Our diverse and growing product range
Botanical ingredients are growing With a strong and established in popularity in several markets background in citrus, our range as ‘naturalness’ continues to be of natural and synthetic products an increasing priority are well aligned with consumer tastes Our synthetic aroma business Our diverse an
Slide 18: Revenue 2014-2024
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 H1 H2
Slide 19: Adjusted operating profit 2012-2024
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 1 excluding exceptional items
Slide 20: Adjusted profit before tax 2014-2024
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 H1 H2
Slide 21: Adjusted earnings per share 2013-2024
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 H1 H2 1 2018 – 2020 EPS is shown from continuing activities
Slide 22: Balance sheet
Fixed assets Inventories Receivables But expected to reduce in H2, the cash Payables generative half Working capital Taxation Volumes have declined but prices led to increase Net (debt)/cash in value Pension asset Other net (liabilities)/assets Focus remains Shareholder funds 23
Slide 23: Cash flow and net debt
Operating cash flow Decrease in inventories (Increase)/Decrease in receivables Increase /(decrease) in payables Cash generated from operations due to record sales in Contributions to pension scheme Taxation paid March Net cash from operating activities Purchase of property, plant & equipment at Purc