Tate & Lyle (LSE: TATE) now has two main business units -- Specialty Food Ingredients and Bulk Ingredients. The former saw an improved second quarter performance, with "solid growth in the US and emerging markets offsetting a weaker performance in Europe". However, the lack of major product launches from customers, plus a strike in Turkey, will mean first-half profits for this part of the business are lower than last year.
Bulk Ingredients has benefited from strong sales of liquid sweeteners, which offset weakness in the US ethanol markets. Thanks to the better performance from this unit, Tate & Lyle (LSE: TATE) expects its first-half profits will be in line with last year.
Looking forward, Tate & Lyle (LSE: TATE) is still expecting corn prices in the US and Europe to be high, following the poor harvests this year. Despite this, and the continuing economic uncertainty, the company still reckons it can "make progress this financial year".
The shares responded to the update with a rise of 1% to 663p. Valued at £3.1bn, Tate & Lyle (LSE: TATE) trades on a forward price-to-earnings ratio of just under 12, while offering a prospective yield of around 4%.
After hitting a low of 230p during early 2009, the shares have since rewarded loyal investors with a superb 190% gain. Such returns suggest it may pay to keep an eye on Tate & Lyle, especially if conditions in the eurozone improve and shares in general embark on a bull run.