Hello, and welcome to the Tate & Lyle Q3 trading statement. My name is Josh, and I will be your coordinator for today's event. Please note that this conference is being recorded, and for the duration of the call, your lines will be on listen only. However, you will have the opportunity to ask questions at the end of the call. This can be done by pressing star one on your telephone keypad to register your question. If you require assistance at any point, please press star zero and you'll be connected to an operator. I will now hand you over to your host, Nick Hampton, to begin today's conference. Thank you. Thank you, operator. Good morning, everyone, and welcome to Tate & Lyle's Third Quarter Conference C all. I will make some introductory comments, and then we'll be happy to take your questions. The group's trading in the third quarter was encouraging and in line with our expectations, driven by strong top-line performance in our continuing business or what will be the new Tate & Lyle, comprising Food & Beverage Solutions and sucralose. Consumer demand for healthier food and drink continues to strengthen across our markets. With our leading expertise in sweetening, mouthfeel, and fortification, and our unique portfolio which helps to remove sugar, calories, and fat, and add our fiber to food and drink, we are very well-placed to meet this growing demand. This was reflected in the top-line growth delivered by Food & Beverage Solutions in the quarter, with double-digit revenue growth across each region. Volume was 6% higher, while revenue was 19% higher, with 3 percentage points coming from acquisitions. Revenue from new products was 54% higher. Looking through the global pandemic at the 2 year picture compared to the quarter ended September 2019 and before reporting changes, volume in Food & Beverage Solutions grew by 12% and revenue by 31%. This growth reflects the increasing strength of our customer relationships and the potential of our ingredient platforms. As expected, sucralose also performed well in the quarter, with revenue 8% higher, reflecting continued solid demand and good customer mix. In discontinued operations, which is our Primary Products business in the Americas, volume was broadly in line with the comparative period and on a 2 year basis. However, as expected, performance was significantly weaker due to cost inflation and actions taken to reduce costs in the comparative period to mitigate the impact of the global pandemic. A key focus in the third quarter was to renew those customer contracts which are based on a calendar year cycle and to offset anticipated inflation. I am pleased that in both our continuing and discontinued businesses, we achieved that goal. However, the cost environment remains uncertain, and we will need to stay agile and very close to our customers as we navigate the year ahead. Turning to the outlook for the year ending March 31, 2022. For our total operations, which is the current Tate & Lyle group, our guidance remains unchanged. With the performance of continuing operations, the new Tate & Lyle expected to be stronger offsetting performance in discontinued operations. The strategic transformation we announced last July is progressing well, and we expect to complete the sale of a controlling stake in our Primary Products business in the Americas at the end of March. As previously announced, following completion of the transaction, we intend to return approximately GBP 500 million to ordinary shareholders by way of a special dividend with an associated share consolidation. We will announce the timing of this shortly after completion of the transaction, and subject to shareholder approval, expect to execute the special dividend before the end of the first quarter of the next fiscal year. The ability of my colleagues to continue serving our customers through the pandemic while also progressing the separation of our two businesses is a great testament to their dedication and agility, and I want to thank them all for their outstanding delivery. Earlier this week, we were delighted to announce the appointment of Dawn Allen as our new Chief Financial Officer from the 16 May. I look forward to welcoming Dawn and working together to deliver Tate & Lyle's growth agenda. In conclusion, we are entering a new and ambitious chapter for Tate & Lyle as a growth-focused specialty food and beverage solutions business. We are doing this from a position of strength and with positive momentum. Supported by increased investment in innovation and a strong balance sheet to fund growth, the new Tate & Lyle is extremely well positioned to deliver on its 5 year ambition to mid-single digit organic revenue growth and on average operating margin expansion of at least 50-100 basis points per year. With that, I will open up the call for questions. Thank you very much. If you would like to ask a question on today's call, please press star one on your telephone keypad now, please. Please ensure your line is unmuted locally. I will then speak to you individually, take your full name, and then introduce you into our call. That's star one on your telephone keypad now, please. Our first question comes from the line of James Targett from Berenberg. Please go ahead. Hello. Good morning, Nick. Couple of questions from me. Firstly, can you just talk a little bit about your inflation costs, in terms of the level of inflation that you're seeing? You know, I appreciate you're saying you're covered, you know, or you're covering your costs in both parts of the business. Just in terms of so we can think of implications for, you know, sort of percentage margins, even if you do cover your unit costs in for the first part of FY 2023. I guess my second question is on the performance of FBS, the kind of the top line. Could you maybe split out the kind of the mixed price component of that sort of 13% growth above the top line? Above the volume growth, sorry. Volume growth year to date in FBS is already sort of in the high single digits. You know, as we move into next year, that's obviously well ahead of your, you know, the initial kind of midterm guidance for New Tate. How do you think about volume growth trending in FY 2023? Thanks. Sure. James, good morning. Thank you. Let me take the second question first on FBS. If you look at the revenue growth in Q3 of 19%, very similar to the first half, by the way, a continuation of what we saw in the first half. You've got six volumes and therefore 13 points of leverage between volume and revenue. Roughly 3 percentage points of that comes from corn price pass-throughs, then you're left with 10. About 3 of the remaining 10 came from acquisitions, notably stevia, where, you know, you've got a good revenue product but relatively light. You've got 7 left, which is primarily driven by mix. Of course, you know, the key driver of that is the fact that you've got both good customer mix across the business as we look to selectively trade up the business, but also importantly, the strong growth of new products. You know, we saw another 50% growth of new products in the quarter, which is very encouraging. Again, consistent with the first half, albeit helped by acquisitions, but still, if you strip out the impact of the acquisitions, you've got new products growing at 20%+. On inflation, rather than getting into kind of specific percentages, you know, clearly very happy with the fact that the team did a good job with the contracting round across both businesses to cover the anticipated inflation we saw. As we look forward, I mean, clearly there's potential for more inflation, but we're well covered on things like corn and energy, and we've built some flexibility into some contracts to revisit should we see some further inflation. We feel pretty well set as we enter the new year with, you know, the caution being that there could be more inflation to come. From a margin perspective, as I said, our real focus was on maintaining absolute margins, and we'll see how that evolves as the year progresses. Thanks. Just following up on just the first part on the FBS, just on the volume side, you know, how do you... Maybe o bviously, the volume growth you're delivering is obviously well above what you've, you know, you're guiding for in the medium term. I'm just thinking, you know, how we should be thinking about volumes over the next sort of 12 months? Look, I think we're clearly over a 2 year picture. If you look at the volumes, then the volume growth is not as high as we saw in the third quarter, indeed the first half, because there's this sort of disturbance from the COVID impact. I would say, I would think about moderating expectations more in line with what we said in our medium-term guidance, as we go into next year. We've somewhat helped a little bit by the acquisitions as well this year. Those two factors have clearly helped. Having said that, you know, the base business has performed very strongly this year, so we're encouraged with the momentum we take into next year. Thank you very much. Thank you. Our next question is from John Ennis from Goldman Sachs. Please go ahead. Hi. Good morning, everyone. I've got three questions actually, Nick, if you don't mind. My first is, I guess could you just talk about what really drove the upgrade to the FBS guidance? I suppose the costs environment has, if anything, gotten worse since we last spoke. Is it just the pricing came through at a level higher than you expected, or is it also that volumes have held up just to get a bit of clarity there? My second question's on the volume. Again, very strong performance in 3Q. I guess you've had some competitors talk about supply challenges and supply chain disruption, which don't really appear to be impacting your business to the same degree. Has this helped boost the 3Q volume performance in terms of market share gains as you kind of capitalize on supply chain disruptions elsewhere and can that persist? My third is I guess a more general question around the term integrated solutions that gets talked about a lot in this space. Is there any kind of color you can give us now in terms of what proportion of your business is now working with customers to reformulate and selling multiple ingredients rather than single ingredients for the continuing FBS business? Maybe that can help us also think about the mix growth within FBS. Thank you. Sure. John, let me take your questions in turn and good morning. The upgrade on FBS, we were very encouraged by the continued top line momentum we saw in the third quarter. If you think about, if you kind of spin around the world, we saw double-digit growth across all markets. You know, Q3 was a tougher lap for us in developed markets, especially because we were sort of lapping a post-COVID costs, if you like, rather than during COVID in the first half. Yet we saw the same momentum on revenue flow through. What we also saw in growth markets was an acceleration because actually COVID impacted growth markets later. It's a combination really of two things. The continued momentum we're seeing on the top line, which is I think a little bit ahead of where we thought we might be. Secondly, the fact that we managed to get the pricing round the way, the way we had hoped. That was the combination of those two things, I would say, so kind of coming together. In terms of volume, look, supply chain is very difficult at the moment. You know, everybody's working really hard to maintain supply to customers, and we are dealing with that like everybody else. Did it impact our business positively from a share perspective in quarter three? I don't think particularly. I think we did a good job of navigating it, but we have some challenges as well, and that's just the nature of the world we're operating in at the moment, and we'll continue to try and stay on top of it and serve our customers as well as we can going forward. Your last question on integrated solutions. I would say, look, I would say we're working increasingly in partnership with customers to help them with reformulation or simplification of recipes. It's still a relatively small part of our mix, so you know, plus or minus 20%. It's always difficult to be precise on these things. You know, that is growing as a proportion of the business. You know, in some ways the thing that encourages me is there's plenty more to go at. You know, we're on a journey that's going to continue. We're hoping to see that percentage rise over time, especially as we see the success of new products continue to flow through. That's really helpful. Thank you. Thank you very much. Our next question comes from the line of Martin Deboo from Jefferies. Please go ahead. Yeah. Morning, Nick. Martin Deboo, Jefferies. Two from me. Can we just go to the bit of the business you probably don't want to talk about, but which I feel obliged to ask about, which is primary. Clearly, the guidance indicates a downgrade to expectations there. I'm interested to know just what the moving parts of that were in Q3, and particularly what's happened on the commodities line within primary? And then the subsidiary question is, does that change slash improve in Q4, given that's the first quarter of the new calendar pricing round? I'll just squeeze in a one in the middle, which is, you just, I think, alluded to the concept of a pricing round in FBS as well, or at least calendar year pricing. As we learn about this new business, can you just give me a sense of how much of FBS is on annual calendar year contracts? Third one is just coming from left field is just what's your latest thinking on where pro forma net debt will be post-separation? You know, the qualitative indication announcement in July was it would be pretty close to zero. Is that still the guidance? Those are my questions. Thank you. Okay. Thanks, Martin. Good morning. I'll take the last one first 'cause it's in some ways the most simple. Nothing's changed. You know, we're anticipating pro forma net debt to be zero as we execute the special dividends or post the special dividends. Yeah. On Primary Products, I'd say, look, performance in the quarter was broadly as expected. We saw actually relatively robust demand for sweeteners and starches, you know, on a two-year basis and for the quarter flat. You know, we absorbed, you know, significantly more inflation than we had to in the first half. You know, I think of it as sort of double the amount of inflationary impact in the first half. You know, there was some extra costs from getting back into normal maintenance programs in the plant as we come out of COVID. Co-products and ethanol, you know, relatively positive. The net of all of that was just modestly down on where we expected to be, but nothing too dramatic. As we look forward into the fourth quarter, we're expecting to see significant improvements in Primary Products. As I said, you know, with the volume we've contracted and the pricing we've achieved, we're expecting to get back to sort of, you know, pre-inflation margins and see, you know, positive pick-up as we go into the new financial year as a result. Your last question was Yeah, last question on calendar year pricing, calendar year contracting in FBS.? Yeah. It varies quite significantly, region by region. You know, a significant proportion of the business in North America and Europe is on annual contracting round. You know, without putting too specific numbers on it, think of it as sort of, you know, 80%+. There's less so in growth markets where, you know, there's a balance of annual pricing and actually sort of month by month pricing as we renew contracts on a rolling basis. If you look at that as a balance, you end up with more than half of your business being annual contracting round because it's the weight of business we have in North America especially. Okay, thank you very much. Thank you. Our next question comes from the line of Patrick Higgins from Goodbody. Please go ahead. Thanks, good morning, Nick. Three questions from me, if you don't mind. Firstly, just on sucralose. Obviously quite a strong Q3 performance after a strong H1. How should we think about that in terms of, I guess, timing that will partially unwind versus, I guess, additional volumes that you've been able to hold on to 2Q to the, your more local supply that you can provide? Second question is just on the European Primary Products business. How has that trended into Q3 after the challenging H1, and how should we think about, you know, its performance in Q4 and FY 2023? How's pricing in that business gone in general? Then finally, just I guess, comforting that the transaction to dispose Primary Products is on track and nearing completion. Just interested to hear your thoughts and what kind of opportunities you are seeing from an M&A perspective, or how full your pipeline of opportunities is, and how quickly you can deploy the additional capital that's about to come in. Thanks. Thanks, Patrick, and good morning. On sucralose, you know, we were expecting to see a strong quarter because of continued demand from customers that we talked about in the first half. Actually, the mix was good as well because of the U.S. We saw strong demand from regional customers, not just the big multinationals. As we go into the fourth quarter, we're lapping a bigger quarter in quarter four last year, so we'll likely see some slowdown in growth. You know, we feel very good about the full outcome for the year, and we're still expecting both revenue and profits to be modestly ahead of last year as we close the full year. As we go into next year, as you rightly point out, you know, we've got a little bit more capacity coming on stream through the year. That should allow us to, you know, certainly deliver a little bit more volume growth. Our target is to continue to maintain profitability on that business into fiscal 2023, so our next fiscal year. I think that covers sucralose. On Primary Products in Europe, the fundamentals of the business didn't really change in the third quarter. You know, we still had high corn costs and low sugar prices, so it was a drag in quarter three, as it had been in the first half of the year. We'll see some improvements in the last quarter, driven by pricing for the calendar 2022 round, so that's a positive move forward. We're starting to see some moderation in corn prices in Europe, although modest at this point. As we go into the next financial year, we expect to see modest improvements in that business. But I think more importantly, you know, medium term, our, you know, our focus will be both on running that business down as we invest in finishing capacity for Food and Beverage Solutions. We're expecting to see corn price and sugar price moderate over time, as well. We're not expecting to see a drag from Primary Products in Europe next year. Your last question on the transaction and M&A. You know, firstly, I think it's important to say we're very, very pleased by the performance of the two deals we did last year. Our pipeline looks encouraging. You know, we're working hard at unlocking more deals as we complete the transaction to progress to the majority of Primary Products in the Americas. Of course, as the world opens up, it's getting a bit easier to travel and make the right relationships. It's always difficult to predict when transactions are going to complete, so I wouldn't want to give you a target. We're working very hard on doing more of the right kind of deals to accelerate the growth of the business in the next 1 to 2 years. Perfect. Thank you. Thank you very much. Our next question comes from the line of Alex Sloane from Barclays. Please go ahead. Yeah. Hi. Morning. Morning, all. A couple of questions from me. Just firstly, picking up on the new products momentum, which is obviously very strong in the quarter. Is there any particular skew to that by, you know, product technology, end market, or indeed geography? How do you see the pipeline for new products over the next 12 to 18 months? The second one, just I mean, just being in the U.K. we have, you know, looming later this year the HFSS regulations due to kick into force. Are you seeing any sort of tangible benefit from that in terms of, you know, step up in customer reformulation in the U.K.? You know, is that something you expect to see more of through the course of the year? Thanks. Okay. Let's start big picture there with the new products more generally. Well, look, the encouraging thing is we're seeing good double-digit growth across all three platforms. Sweeteners, Texturants and Mouthfeel and Fortification, our fibers portfolio. This year it's being led by sweeteners. You know, a big piece of that obviously is the stevia acquisition. More broadly, across allulose, monk fruit, we're seeing good broad-based growth in Sweeteners. We're seeing good growth in clean label starches, and that's consistent with the clean label trend across the world. You know, frankly, our fibers are in huge demand because dietary fiber is absolutely on trend, and PROMITOR is a very strong product. It's good broad-based growth across the portfolio. That's important actually because it's not any one thing. As we look at the pipeline going forward, that'll be true as well. It's a broad-based pipeline across the three platforms rather than, you know, one individual product. It gives us a balanced portfolio for the future. As I said, you know, obviously the 50% odd growth year-to-date and in the quarter is helped by acquisitions, but we're still growing 25%+ if you strip out acquisitions. New product is really, you know, fueling the growth of the business at the moment. And that's incredibly encouraging. Of course, it's about reformulating. If you think about Sweeteners to take sugar out, it's the things that we've talked about in terms of healthier living, which brings me on to the U.K. We're not seeing anything specific in the U.K. that's significant versus elsewhere in the world, but it is clear that legislation is gonna start to have a big impact everywhere. You know, we're seeing it in Latin America with front-of-pack labeling. We're seeing it in Asia because of the focus on obesity and diet. We're seeing it in North America because of, you know, people's increased concern about health post-COVID. The U.K. will be a part of that, but it's a global phenomenon that we're dealing with here, and that's, you know, what's helping with those new product numbers that I just talked about. Thanks very much. Thank you. Our next question comes from the line of Karel from Kepler. Please go ahead. Yes, good morning, all. Thanks for taking the questions. I have a few follow-up ones. The first one is with regards to the volume growth. Has there been any significant pre-ordering ahead of the price increases? That's the first question. The second question is with regards to the change of Tate & Lyle. You know, you aim to refocus as a growth company and nearly there. In terms of culture within the company and change of agenda, what can the new CFO add? The third question is on texturants, a follow-up question. Most of your texturants today are still corn-based. How's the momentum with non-corn-based texturants, and yeah, can we expect any major innovations in the coming years in this field? Thank you. Thanks, Karel, and good morning. Let me take your questions in order. On volume and we haven't seen any significant evidence of pre-ordering. You know, our volume run rates have been pretty consistent through the whole of quarter three. We didn't see anything in December that was particularly unusual. You know, frankly, the challenges with shortage of transport globally makes it very difficult to ship volumes quickly. There was a sort of natural, you know, hedge there, almost you could say, if you like. On Dawn coming in, look, we're delighted that Dawn's joining the business. I mean, she brings a huge amount of experience from the food and beverage industry. She also comes from a very purpose-led organization, which is very consistent with the culture we're trying to drive. More recently, she's played a core role in the transformation in Mars from an operating model perspective. She brings a good balance of industry background, cultural fit, and then experience of transformation that is just a perfect fit for what we're doing in the next phase of our growth. It's a, you know, really encouraging appointment for us. On texturants, as you rightly say, historically very corn focused. The tapioca acquisition clearly helped shift that for us, and, you know, we're delighted with the performance of the tapioca business so far this year. Yes, I think you will see us increasingly look to expand into other substrates for texturants as we look to grow the business and strengthen our texturants portfolio in service of our customers. Thank you. Just as a reminder, if you would like to ask a question on the call today, it is star one on your telephone keypad now, please. Our next question comes from the line of Chris Pitcher from Redburn. Please go ahead. Hi there. Thank you, Nick. Apologies if this has been covered. My phone dropped off briefly. On sucralose, you're still seeing continued strong volume growth. The last time we spoke, there was a discussion around potentially expanding capacity if you could get the contracts in place long duration enough. Are you going through the process at the moment of having those discussions? When should we expect some sort of decision on whether you're gonna double down on sucralose or not? Secondly, apologies following up on NewCo, but with the pricing, with the contracting round now done, does that give you more visibility? Can you say more around expected dividends? Can we just finalize the tax structure and interest of NewCo? Have you got any more color on that? Thanks very much. On sucralose, look, I won't go into details of any commercial discussions we're having at the moment. You know, what we are doing already is increasing capacity modestly to allow us a little bit of room to grow in the short term. Long term, we'll see how the commercial shape of the business plays out. On NewCo, the contracting round went as we had hoped. That's good for the business. I don't think there's anything new to say on dividend or on interest at this stage. I mean, we'll come back to it at the full year when we finalize the transaction. I'd probably wait until then. Thank you. Okay, we have no further questions in the queue, so I'll hand you back over to the speakers. Thank you, operator, and thank you all for your questions. Look, in summary, Food & Beverage Solutions continues to deliver strong top-line growth. New products performance remains excellent, and we saw positive contracting for the 2022 calendar year. The transaction to create two focused businesses is on track for completion at the end of March, and we're looking forward with confidence to the future of the new Tate & Lyle. With that, Dawn and I look forward to talking with you on the 9 June at our full year results. Thank you, everyone. Thank you, operator. Have a good rest of your day. Thank you very much for joining today's call. You may now disconnect your handsets. Hosts, please stay on the line.