Annual Financial Report and Notice of AGM

Tate & Lyle PLC

04 June 2024

 

Tate & Lyle PLC

Annual Financial Report and Notice of Annual General Meeting 2024

In accordance with Listing Rule 9.6.1, Tate & Lyle PLC (the 'Company' or 'Tate & Lyle') confirms that copies of the following documents have been submitted to the National Storage Mechanism and will shortly be available for inspection at: https://data.fca.org.uk/#/nsm/nationalstoragemechanism

1.   Annual Report 2024 - http://www.rns-pdf.londonstockexchange.com/rns/1075R_4-2024-6-4.pdf

2.   Notice of Annual General Meeting 2024 - http://www.rns-pdf.londonstockexchange.com/rns/1075R_2-2024-6-4.pdf

3.   Notice of Availability - http://www.rns-pdf.londonstockexchange.com/rns/1075R_1-2024-6-4.pdf 

4.   Proxy Form - http://www.rns-pdf.londonstockexchange.com/rns/1075R_3-2024-6-4.pdf

The Annual General Meeting 2024 will be held at the Royal College for Nursing, 20 Cavendish Square, London, W1G 0RN at 10.30am on 25 July 2024.

The Annual Report 2024, Notice of Annual General Meeting 2024, Notice of Availability, and Proxy Form are also available on the Company's website: https://www.tateandlyle.com/news/2024-annual-report-and-notice-agm. Mailing of the Annual Report 2024, Notice of Annual General Meeting 2024, Notice of Availability and Proxy Form to shareholders who have requested or are entitled to receive them will occur shortly.

We will notify shareholders of any significant updates to our Annual General Meeting 2024 arrangements via a regulatory information service and on the Investors Hub section of the Company's website.

Annual Financial Report

For the purposes of complying with Disclosure Guidance and Transparency Rule ('DTR') 6.3.5R, and the requirements it imposes on issuers as to how to make public annual financial reports, we set out below:

-     in Appendix A, the principal risks and uncertainties facing the Company;

-     in Appendix B, the Directors' responsibility statement; and

-     in Appendix C, the disclosure regarding related party transactions.

The appendices have been extracted from the Annual Report 2024 in unedited full text and page numbers in the text refer to page numbers in that document. This information should be read in conjunction with the Company's 2024 full-year results announcement, released on 23 May 2024, which contained a condensed set of financial statements and can be found at www.tateandlyle.com/investors/results-and-presentations. Together, these constitute the material required by DTR 6.3.5R to be communicated to the media in unedited full text through a Regulatory Information Service.

Claire-Marie O'Grady

Company Secretary

4 June 2024

For more information contact:

Investors and analysts

Christopher Marsh, VP Investor Relations

Mobile: [phone]

APPENDIX A

PRINCIPAL RISKS AND UNCERTAINTIES

Strategic risks

1.   Strategy delivery

Failing to grow Food & Beverage Solutions would prevent us from delivering against our Group targets. This could reduce our profitability in both the short and long term and damage investors' view of us. Revenue and EBITDA growth, and M&A activity, are key components of how we

will successfully grow our business, and we have a five-year strategic plan in place to support this.

How we mitigate the risk

·      Our organic and acquisitive growth plan supports our strategy. We have global and regional five-year plans focused on key categories.

·      Our Board regularly reviews and challenges the strategic direction of the business to help us stay competitive and successful in our chosen markets.

·      Our Executive Committee regularly reviews our strategic progress and financial performance, as well as the opportunities in our markets and competitor activities.

·      Our M&A team works closely with Innovation and Commercial Development (ICD) and Food & Beverage Solutions to identify acquisitions and partnerships that will help us grow.

·      We have incentive schemes and bonus programmes in place for customer-facing teams that are tied to strategic, commercial and operational targets.

What we've done this year

·      We strengthened our customer offering and presence in Asia with the integration of our acquired stevia and tapioca businesses, as well as Quantum Hi-Tech, a leader in FOS and GOS dietary fibres in China.

·      We invested in further building our solution selling capabilities in areas such as sensory and open innovation.

·      We executed targeted programmes to develop new ways of working with customers to build stronger solutions-based partnerships.

·      We expanded our global network of Customer Innovation and Collaboration Centres, opening a new Centre in Jakarta, Indonesia.

·      We continued to build our technical service capabilities in Asia, the Middle East, Africa and Latin America - a process we began last year to accelerate our business presence in higher growth markets.

·      We launched a number of online tools to support and build connections with our customers. These include our Communities of Practice for dairy and beverage, and our Technical Exchange Forums for areas such as plant-based products.

Trend compared with 2023 financial year: unchanged

2.   Innovation

Developing and commercialising new products is essential to our ability to lead the industry in our chosen categories, and therefore to the long-term growth of our business. Without them, we might be unable to meet our customers' future requirements which could damage our performance and reputation and result in customers switching to competitors.

How we mitigate the risk

·      We have a robust innovation process based on both in-house development and external open innovation, which delivers a strong pipeline of new ingredients and solutions for our customers.

·      Our ICD team monitors consumer and category trends and works closely with commercial partners to ensure new products and solutions meet our customers' needs.

·      Our ICD team connects with external organisations, including biotech, pharma, and food technology ecosystems, to identify and make the most of scalable innovation and new product opportunities.

·      We prioritise opportunities to partner with our customers to accelerate development cycles and bring new products to market more quickly.

What we've done this year

·      Our investment in innovation and solution selling capabilities, increased by 5%.

·      New Product revenue grew by 13% on a like-for-like basis (ie no products are removed from disclosure due to age).

·      Solutions revenue from new business wins increased by 3ppts, to 21%.

·      We launched nine New Products into the market including TASTEVA® SOL Stevia sweetener, a patent-protected breakthrough in stevia technology to help customers solve stevia solubility challenges.

·      We invested in a new automated lab at our Customer Innovation and Collaboration Centre in Singapore with advanced technology to accelerate the development and speed-to-market of mouthfeel solutions.

·      We improved our approach to developing and deploying ingredients as part of a solution, in particular by embracing our global solutions chassis approach.

·      We added 61 patents to our portfolio and now have over 540 patents granted and over 220 pending.

Trend compared with 2023 financial year: unchanged

3.   People and talent

It is critical that we have the right people with the right capabilities to be a purpose-led global business and deliver our strategy. We have strategies in place to recruit, develop and retain our people and to build a diverse and inclusive workforce.

How we mitigate the risk

·      Our talent development plans give employees opportunities and training to build their capabilities and resilience.

·      We have set several 2030 targets to track our progress on delivering equity, diversity and inclusion.

·      We have initiatives in place at Group, local and functional levels to progress equity, diversity and inclusion across the organisation. We also have employees dedicated to developing and measuring our progress on equity, diversity and inclusion.

·      We have a mix of short- and long-term incentives. This includes a bonus scheme available to a broad population of employees.

·      We have a single global performance management system and talent planning process.

·      We carry out global employee surveys that help tell us what employees really think about working at Tate & Lyle.

·      Our Executive Committee and the Board plan succession for business-critical roles.

·      We encourage our people to share open and transparent feedback so we can react to any challenges that emerge.

What we've done this year

·      We focus on maintaining competitiveness by updating our reward framework to ensure it reflects current local conditions.

·      We have a Group-wide programme to support the physical and mental wellbeing of our employees.

·      We carried out a global employee engagement survey managed by an external organisation. The response rate was high at 80% and showed an encouragingly strong level of employee engagement.

·      We have seven Employee Resource Groups which play an important part in enabling employees to experience solidarity, support, education, growth and development.

·      We are strengthening our performance management system to create clear strategic alignment for our teams, as well as introducing a more frequent development conversation cycle and clarity of reward outcomes.

·      We launched a new management training programme, Connect Catalyst, to help our managers create an engaging, inclusive and high-performing organisation. More than 200 managers have taken part so far.

·      We completed a talent review for all employees to understand their capabilities, aspirations and potential and how that connects with future development and succession opportunities.

Trend compared with 2023 financial year: unchanged

4.   Climate Change and Sustainability

Climate change risks, both physical and transition, such as extreme weather events, temperature rises, water stress and increased regulation, may increase volatility in our raw materials supply chain and production costs. They may also lead to capacity constraints and higher costs of compliance. In addition, the failure to meet our sustainability goals could result in financial loss and reputational damage among customers, consumers, investors and other stakeholders.

How we mitigate the risk

·      Caring for our planet is one of the three pillars of our purpose, and considering the impact of climate change is embedded in our key processes, including capital investment, new product development and acquisitions.

·      We have established a governance process to oversee and monitor our sustainability programme including a Sustainability Committee that is chaired by the Chief Executive, and meets at least twice a year, and a Sustainability Working Group which meets at least monthly.

·      We have set Group targets to reduce our absolute greenhouse gas emissions, our water use intensity and to ensure we beneficially use our waste. We also operate sustainable agriculture programmes.

·      Each site is set sustainability goals each year as part of the annual planning process.

·      We run communication programmes to highlight the impact of climate change and encourage our employees to help us reduce our impact on the planet.

·      Our risk management and sustainability teams work alongside the business to identify potential risks associated with resource scarcity, particularly within sourcing key raw materials, manufacturing, water and energy and look for ways to mitigate those risks.

·      We encourage our people to help us lower our impact on the planet while improving efficiency through our J2E programme (see pages 41 - 43).

What we've done this year

·      We continue to make good progress against our 2030 sustainability targets and commitments.

·      In May 2024, we announced ambitious new Scope 1 and 2 and Scope 3 GHG emissions targets to 2028. These targets have been validated by the Science Based Targets initiative and are aligned to a 1.5 ̊C trajectory.

·      Through our sustainable agriculture programme with Truterra LLC in the US, we maintain sustainable acreage equivalent to the volume of corn we buy globally each year (367,000 acres in 2023).

·      We continue to deliver a positive environmental impact through our sustainable stevia agriculture programme in China, working in partnership with the NGO, Earthwatch Europe, and Nanjing Agricultural University.

·      Our facility in Guarani, Brazil, became our first site to be 100% powered by renewable energy and our facilities in the Netherlands, UK and Italy are buying 100% of their electricity from renewable sources.

·      We carried out an analysis of the impact of climate change on our operations and supply chain to identify key climate-related issues that are affecting our business currently, and could have an impact in future, to help us prioritise actions to mitigate those risks.

·      We carried out a water risk assessment at our main facilities and across our corn and stevia supply chain.

Trend compared with 2023 financial year: increasing

Operational risks

5.   Operating Safely

Safety is not just a priority at Tate & Lyle, it's foundational. Failure to comply with laws and regulations relating to health, safety and the environment could result in us being unable to protect our employees, stakeholders and the wider communities in which we operate. It could also lead to fines and have a negative impact on our reputation.

How we mitigate the risk

·      We have a continuous improvement plan for Environment, Health, Safety, Quality and Security (EHSQS) in place at all our sites (also known as the J2E). It is visibly sponsored by the Chief Executive and Executive Committee.

·      Our EHS Advisory Board, which includes our Chief Executive, receives EHSQS updates and reviews performance quarterly. Our Executive Committee and Board regularly review safety performance and progress against J2E.

·      We have an Incident Review Board which conducts reviews of major, severe or potentially severe events.

·      Benchmark, a cloud-based tool, is used to manage EHS data and facilitate EHS reporting.

What we've done this year

·      We saw a significant improvement in our safety performance with the recordable incident rate 41% lower and in the lost-time rate 38% lower.

·      In J2E, 60% of our plants and 38% of offices and labs had passed tollgate 5 by the end of March 2024, with three sites having passed tollgate 7.

·      We continued to deliver a major shift in risk awareness through our combustible dust and chemical management programmes.

·      We continued to focus on employee wellbeing as part of our J2E programme.

Trend compared with 2023 financial year: unchanged

6.   Product Quality

Poor quality products could cause safety issues and also damage our reputation and relationships with customers. This could have a negative effect on our performance and corporate reputation.

How we mitigate the risk

·      We have strict quality control and product testing procedures in place.

·      We regularly test our recall process.

·      We have a third-party audit programme, supplemented by internal compliance audits.

·      We assess our raw material suppliers, tollers and third-party warehouses for food safety and quality risks.

·      We have a programme to manage allergens in our supply chain and ensure our ingredients are either free from allergens or that any allergens are disclosed.

·      Our Quality Incident Review Board investigates incidents and shares best practice across our sites.

·      We have a governance process in place for Tate & Lyle and Primient to regularly review compliance with our long-term supply and other agreements. Amongst other things, these determine the safety and quality standards that products sold to each business must meet.

What we've done this year

·      We successfully started up our new quality lab within our facility in Hoffman Estates, Illinois, US, complete with ISO certification.

·      Our product recall processes were externally assessed and validated by our insurance company, and we carried out simulation exercises.

·      We fully implemented our environmental monitoring programme at all our locations.

·      We simplified our Food Safety Incident Management programme, including implementing a steering committee and delivering training.

·      We transitioned all our manufacturing facilities to the ISO-based FSSC 22000 GFSI (Global Food Safety Initiative) scheme.

·      We developed and implemented a professional development programme for quality team members.

·      We refreshed our 'management of change' (MOC) processes to enhance our compliance from a quality, legal and regulatory perspective.

Trend compared with 2023 financial year: unchanged

7.   Supply chain

Fluctuations in crop prices could affect our margins. Climate and weather-related events, disease, lower yields, competition for acreage and freight restrictions can impact crop availability and therefore price. We may not be able to pass the full change in raw material prices, or higher energy, freight or other operating costs, on to our customers. Our margins may also be affected by customers not taking expected volumes.

How we mitigate the risk

·      We have strategic relationships and multi-year agreements with suppliers and trading companies.

·      We increase the security of our supply through our raw material and energy purchasing policies.

·      We have a governance process in place for Tate & Lyle and Primient to regularly review the delivery of the long-term supply agreements we have in place, as well as related corn procurement services.

·      We benefit from the scale and expertise of Primient's corn procurement services. This provides security of supply and allows us to lock in corn prices when we secure customer contracts, reducing cost volatility.

·      We maintain a good working relationship with KPS Capital Partners the majority shareholder in Primient.

What we've done this year

·      The raw material procurement team continued to manage corn supply across the European corn sourcing regions for both dent and waxy corn.

·      We identified new sourcing regions and suppliers for dent and waxy corn in Europe, and agreed new waxy corn contracts to support our volume growth.

·      We review and renew our energy supply contracts every year or, where required, we adjust them to manage supply and price conditions.

·      To further build resilience, we undertook a review of the impact of climate change on our logistics and raw material supply chain over the last five years, looking at the mitigations we had put in place, and their effectiveness. The lessons learned and subsequent actions are increasing the resilience of our supply chain.

·      We hold monthly sessions with Primient to manage key supply topics, including short-term adjustments in supply and medium-term forecasting.

Trend compared with 2023 financial year: unchanged

8.   Business disruption

Business disruptions can occur for a range of reasons, including pandemics, natural disasters, and geopolitical turbulence. There are also many risks in operating our plants that could cause breaks in production, leading to disruption to our business and a deterioration in customer services. In all cases, this could affect our financial performance and damage our ability to grow our business.

How we mitigate the risk

·      We have a global business continuity management framework in place to enable effective recovery from a major disruption.

·      Our Risk Committee oversees existing and emerging risks to ensure mitigating actions are in place wherever possible to meet customers' needs.

·      Having plants in different regions and countries means we can continue to serve customers where practical if a particular area or plant is disrupted. It also diversifies our business into different markets and geographies.

·      Our plant network has a preventative maintenance programme.

·      Our customer service team is part of Global Operations so works closely with our plants, enabling us to be agile and responsive to customer needs.

·      We have contingency plans to manage, as far as possible, disruption such as extreme winter weather.

·      We have a governance process in place for Tate & Lyle and Primient to regularly review the delivery of the long-term supply and other related agreements.

What we've done this year

·      We undertook business continuity tests at all our sites.

·      Our Manufacturing Excellence programme continues to support our ability to operate safely and efficiently. It is a process of continuous improvement across the business to drive safe working practices, strengthen resilience and develop our wider safety culture.

·      We enhanced our sales and operational planning programme by using technology to improve our ability to forecast effectively and strengthen how we supply customers.

·      We introduced a Global Enterprise Crisis Management Policy and strategy to strengthen our ability to manage large-scale business disruption.

·      We undertook a review of the impact of climate change on our manufacturing facilities, logistics and raw material supply chain over the last five years, looking at the mitigations we had put in place and their effectiveness. The lessons learned and subsequent actions are increasing the resilience of our business.

·      We also carried out an analysis of the impact that geopolitical turmoil and trade restrictions could have on our operations, supply chain and key products, and the mitigations we have in place, and their effectiveness.

Trend compared with 2023 financial year: unchanged

9.   Cyber and IT resilience

We need to maintain the continuing operation and security of our information systems and data.

A cyber security breach, whether stemming from human error, deliberate action or a technology failure, could lead to unauthorised access to or misuse of our information systems, technology or data. This, in turn, could result in harm to our assets, data loss and business disruption - and could bring legal risks and reputational damage.

How we mitigate the risk

·      Our cyber security programme focuses on maintaining and strengthening our defences in terms of our processes, people and technology.

·      We run compulsory cyber security awareness training for our employees which includes simulated phishing campaigns.

·      We have robust cyber security defences including a continuous programme to detect threats and vulnerabilities, and we carry out independent penetration tests.

·      Our plants run on separate IT systems which increases their resilience.

·      We have a 24/7, third-party security operations centre to deal promptly with any issues.

·      We have an investment plan in place to update ageing equipment and address new threats as they emerge.

·      As part of the integration process, acquisitions are aligned to our operational and cyber security model.

What we've done this year

·      We improved our email protection by using new monitoring technology.

·      We introduced new reporting and dashboard capabilities across our cyber and operations landscape.

·      We completed integrations of businesses acquired in Asia to ensure they align with our operational and cyber model.

·      We established a separate IT security environment for China, to improve our resilience.

·      We replaced equipment that had reached the end of its useful life and that we could no longer maintain effectively within our operations.

Trend compared with 2023 financial year: increasing

Legal, regulatory and governance risks

10.  Legal and Compliance

If we don't meet our legal and/or regulatory obligations, our relationships with customers and suppliers are likely to suffer. We could be subject to contractual claims, threats to our licences and, in extreme cases, risks to our directors and officers. It could also affect our performance and corporate reputation.

How we mitigate the risk

·      Our legal and regulatory teams work closely with colleagues around the world to identify legal and regulatory risk and provide advice and solutions to mitigate them.

·      We regularly monitor legal and regulatory developments to make sure we understand how any changes could affect Tate & Lyle.

·      We regularly review our key policies and training material, and update them as needed.

·      We run a comprehensive legal and ethics and compliance training programme.

·      We have a third-party whistleblowing service that allows our employees to raise concerns anonymously if they're not comfortable speaking up internally.

·      We have lawyers in each region to work with colleagues to identify and mitigate relevant legal and regulatory risks.

What we've done this year

·      We further embedded our contract documentation processes including the tracking of customer terms and conditions, and provided training to our sales teams.

·      We worked with our procurement team to review the effectiveness of our legal and compliance processes for suppliers and implemented improvement opportunities identified.

·      We continued to run our annual legal, ethics and compliance training across the organisation, including training on our Code of Ethics, anti-trust/competition, modern slavery, criminal finances and trade secrets (all with at least 98% compliance completion rates).

·      We reinforced our sanctions procedures and continued to provide training to relevant employees.

·      We continued to expand our Responsible Sourcing Programme with further audits completed of existing Tier 1 suppliers and further due diligence on new, high-risk suppliers.

Trend compared with 2023 financial year: unchanged

11.  Financial controls

Without effective internal financial controls, we could be exposed to the risk of fraud and error in our financial reporting, as well as losses from events which may then affect our performance and ability to operate.

How we mitigate the risk

·      We have a well-established framework of financial policies and standards supported by procedures and controls over key processes. Where possible, these controls are automated, and we maximise the use of preventative controls.

·      We monitor the design and operating effectiveness of controls on an ongoing basis and regularly report the results to the Audit Committee and Executive Committee.

·      We have several forums to monitor and manage the effectiveness of our financial controls, such as our quarterly regional Control Environment Councils chaired by the relevant General Manager.

·      The Chief Executive and Chief Financial Officer review the business and financial performance at least monthly.

·      At both the half year and the end of the financial year, Executive Committee, the Audit Committee and the Board receive confirmation that minimum control standards are operating effectively.

·      Our well-resourced Group Audit and Assurance team provides independent assurance to management and the Board.

What we've done this year

·      We continued to invest in our financial controls function and our centres of excellence within our Global Shared Services Centre in Poland.

·      We continued to evolve our Risk and Controls matrix to ensure that our controls adapt to mirror changes within the organisation along with increasing levels of automation across multiple process areas.

·      We continue to leverage our Finance Global Process Ownership Forum, to maintain consistency and effectiveness of financial controls at all Group locations.

·      We continued to invest in training to ensure control owners fully understand their responsibilities and accountabilities.

·      We continued to leverage technology to enhance our control environment and support our key financial processes.

Trend compared with 2023 financial year: unchanged

12.  Regulatory and trade risks

The regulatory status or perception of our ingredients could be affected by things like changes in customers' or consumers' attitudes, changes in food laws and regulations and/or campaigns targeted at specific ingredients or technologies. These could affect our ability or freedom to operate. Government actions or policies could also impose import/export limitations and other barriers on our business. These could lead to additional costs, restrict our growth and limit our ability to operate in certain markets.

How we mitigate the risk

·      The science behind our ingredients, for example, health claims or nutritional impact, is supported by credible sources and is communicated clearly to, so that it is understood by, the relevant regulatory authorities.

·      Our global regulatory team, supported by external consultants, monitors any local regulatory requirements that affect our products.

·      Our global nutrition team initiates and monitors research and publications on the use and functionality of our ingredients, and maintains a global advisory network of health and nutrition clinicians, academics and experts.

·      We work closely with thought-leading customers around the world to jointly focus on the science and consumer benefits of our ingredients.

·      We are members of trade organisations that give us access to broader sources of information and provide, where necessary, a single voice for our industry on issues of both regulatory and public interest that affect our ingredients.

·      We engage with political parties, influencers and regulatory authorities in the main countries in which we operate.

What we've done this year

·      We worked with national and state trade associations, as well as local authorities in several key countries where we operate, including the US and China to progress our commercial and sustainability goals.

·      We continued to develop our regulatory team in the Asia, Middle East, Africa and Latin America regions to strengthen relationships with regulators in these markets.

·      We continued to invest in our Global Nutrition team with funding for studies that support the safety and efficacy of our ingredients and maintain differentiation against competitors.

·      We expanded our advocacy programme in key markets; including building partnerships with customers and participating on the boards and committees of key trade associations. This included working with trade associations and other nutritional bodies to improve understanding about the importance of the nutritional content of food, rather than the level of processing, as well as the benefits of low- and no-calorie sweeteners to help reduce their calorie and sugar intake.

·      We continued to expand our online Nutrition Centre, which includes independent scientific contributions by external experts on key topics of public health and on our ingredients.

Trend compared with 2023 financial year: increasing

APPENDIX B

DIRECTORS' RESPONSIBILITY STATEMENT

In accordance with Disclosure Guidance and Transparency Rule 4.1, the directors confirm, to the best of their knowledge that:

•     the Group financial statements, prepared in accordance with UK-adopted international accounting standards, give a true and fair view of the assets, liabilities, financial position and profit of the Company and undertakings included in the consolidation taken as a whole;

·      the Annual Report, including the Strategic Report, includes a fair review of the development and performance of the business and the position of the Company and undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face; and

·      they consider the Annual Report, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Group's and Company's position and performance, business model and strategy.

APPENDIX C

RELATED PARTY DISCLOSURES

Identity of related parties

The Group has related party relationships with its joint venture, the Group's pension schemes and with key management, being its Directors and executive officers. Key management compensation is disclosed in Note 9. There were no other related party transactions with key management.

There were no material changes in related parties or in the nature of related party transactions during the 2024 financial year and no material related party transactions containing unusual commercial terms in the current or prior year. In the 2023 financial year, as a result of the sale of the controlling stake in the Primient business, the Group holds a 49.7% interest in Primient.

Related party transactions with the Primient joint venture and outstanding balances

	Year ended 31 March
	2024	2023
	£m	£m
Sales of goods and services to joint ventures and other income	39	47
Purchases of goods and services from joint ventures	243	302
Receivables due from joint ventures	11	16
Payables due to joint ventures	1	18

Transactions entered into by the Company, Tate & Lyle PLC, with subsidiaries and between subsidiaries as well as the resultant balances of receivables and payables are eliminated on consolidation and are not required to be disclosed.

Sales of goods and services to the Primient joint venture are considered in scope of IFRS 15 and relate to the Group's commitment under the long-term agreements in operation following the completion of the Transaction to produce industrial starches for Primient under a tolling arrangement whereby Primient retains control of the net raw material at all times. The Group earns a manufacturing margin for this production when the service is provided. All associated income is earned in North America. The Group considers it appropriate to exclude this amount from revenue and record the income in operating profit on the basis that this income is generated with a related party, is not part of the Group's normal revenue generating activities (where revenue is recognised when control of the goods is transferred), only arises because of the relationship that exists in which Primient is a supplier of the Group, and is outside the Group's core focus on speciality food and beverage solutions.

 

END