LONDON (ShareCast) - (Sharecast News) - Ingredients specialist Treatt posted a sharp fall in revenues and earnings on Tuesday, following a "challenging" start to the year hit by higher costs and weaker demand.
Sales at the AIM-listed firm - which supplies the beverage, flavour and fragrance industries - fell 11% in six months to 31 March, while pre-tax profits before exceptional items slumped 52.1% to £3.6m.

Adjusted earnings before interest, tax, depreciation and amortisation were 38.9% lower at £6.5m.

Treatt said it had been a "challenging" start to the year.

It continued: "The first quarter is always our quietest quarter and although the second quarter picked up, and there are some signs of encouraging momentum, [it] was lower than expectations."

As at 1400 BST, the stock was trading 5% lower at 258.58p.

Treatt first warned in April that it had been hit by lower demand, weaker consumer confidence and higher costs.

In particular, sustained high citrus prices affected buying patterns in its heritage unit, while consumer confidence in the US was softer due to mounting geopolitical uncertainty.

David Shannon, chief executive, said: "This has been a disappointing first half, with revenue and profitability impacted by predominantly short-term trading challenges, but there are encouraging signs for the future.

"We are encouraged by our robust order book and sales pipeline, and expect to realise the benefit of self-help measures in the second half."

The firm reiterated its revised full-year guidance for revenues of between £146m and £153m. Pre-tax profits before tax and exceptional items are forecast to come in between £16m and £18m.

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