Tate & Lyle Aktie

Good morning. Thank you for dialing into Ingredion's call. I'd now like to turn the call over to Noah Weiss.

Good morning, everyone, and thank you for joining us. I'm Noah Weiss, Vice President of Investor Relations. Joining me on today's call are Jim Zallie, our CEO, President and CEO and Jason Payant, our Vice President and Interim CFO. The press release we issued today as well as the presentation we will reference for this call can be found on our website, ingredion.com. There's also a separate landing page that we have set up on our website to access materials and disclosures in connection with this transaction. As a reminder, our comments within this presentation may contain forward-looking statements. These statements are subject to various risks and uncertainties and include expectations and assumptions regarding the company's future operations and financial performance.

Actual results could differ materially from those estimated in the forward-looking statements, and Ingredion assumes no obligation to update them in the future as or if circumstances change. Additional information concerning factors that could cause actual results to differ materially from those discussed during today's conference call or in this morning's press release can be found in the company's most recently filed annual report on Form 10-K and subsequent reports on Forms 10-Q and 8-K. During this call, we will also refer to certain non-GAAP financial measures, including adjusted EBITDA and adjusted operating income, which are reconciled to U.S. GAAP measures in today's presentation appendix.

With that, I will turn the call over to Jim.

Thanks, Noah, and good morning, everyone. Today, we are announcing the recommended all-cash offer by Ingredion for the acquisition of Tate & Lyle, a significant milestone in Ingredion's transformation to a global leader in ingredient solutions. Combining Ingredion and Tate & Lyle's complementary portfolios establishes a global leader with the innovation, expertise and geographic reach that will help create the future of food.

The combined group will be better positioned to serve customers' needs for the development of great tasting, healthier and affordable food products that consumers demand. This compelling combination will create exciting new possibilities for employees while also generating significant value for all stakeholders. This acquisition represents a leap forward in a transformation that Ingredion has been executing for nearly a decade to create a more global, scaled ingredient solutions provider, better equipped to help customers solve key formulation challenges across taste, texture, nutrition and performance.

Additionally, the acquisition expands Ingredion's localized innovation network, thus enabling deeper co-creation with customers and accelerating our speed to market.

Just as importantly, the combination of our ingredient solutions capabilities with those of Tate & Lyle strengthens our formulation expertise, enabling us to deliver more integrated, higher-value solutions that help customers meet performance and affordability needs. And finally, our expanded manufacturing and commercial network enhances our ability to provide reliable, cost-effective supply to customers around the world. We believe these capabilities will make Ingredion the partner of choice for customers. For the benefit of those less familiar with Tate & Lyle, let me spend a few minutes providing details on why we are so excited about this opportunity.

Headquartered in London, Tate & Lyle is a highly respected ingredient solutions company with a long and rich history. Like Ingredion, they have spent more than a century helping food and beverage manufacturers solve complex formulation challenges and bringing new products to market.

Tate & Lyle has generated approximately $2.7 billion in full year 2026 revenue and about $570 million in adjusted EBITDA, with approximately 5,000 employees globally and a patent portfolio of roughly 1,000. Tate & Lyle's revenues are geographically balanced across the Americas, Europe, Middle East and Africa and Asia Pacific, and they have established leading capabilities in mouthfeel, sweetening and fortification. Both Ingredion and Tate & Lyle are trusted brands with storied histories serving customers in the food and beverage industry for more than 100 years. Over time, both companies have evolved from their roots in traditional ingredients to businesses focused on higher-value specialty ingredients and customer solutions.

Both organizations have strong commitments to innovation and have independently invested to expand capabilities focused on attractive growth areas. This gives us confidence in the strategic fit and in the portfolio we continue to expand. As we touched on earlier, this transaction rapidly accelerates a transformation we've been executing for nearly a decade, shifting our portfolio toward higher-value, higher-growth specialty solutions. Following the combination, more than half of our revenue will come from Texture and Healthful Solutions, the fastest growth portion of our portfolio where customer and consumer demand remains strong and volume growth persists.

On a combined basis, Tate & Lyle and Ingredion will have generated $10 billion of revenue with an adjusted EBITDA margin of 18.1% before integration and synergies. Now let me briefly walk through the key transaction terms. Ingredion has agreed the terms of a recommended all-cash offer to acquire Tate & Lyle under which the shareholders of Tate & Lyle will be entitled to receive GBP 5.95 per share, which implies a total enterprise value of approximately $5 billion and represents an acquisition multiple of 8.8x full year 2026 adjusted EBITDA.

Tate & Lyle shareholders will also be entitled to receive a final dividend of no greater than 13.2p per ordinary share and an interim dividend of no greater than 6.8p per share for financial year ended March 31, 2026, and the 6-month period ended September 30, 2026, respectively. Following the transaction, the company is expected to have approximately $10 billion in revenue and adjusted EBITDA of $1.8 billion, representing an 18.1% margin prior to integration and synergies, creating a more -- creating a larger, more diversified ingredient solutions platform with an enhanced growth profile.

Additionally, we expect a significant run rate net cost synergy opportunity of approximately $130 million by full year 2030 with onetime cash costs of $175 million. We expect the transaction to be more than 15% accretive to adjusted EPS in the first full calendar year following the acquisition with significantly improved free cash flow conversion. As it relates to capital structure and financing, the transaction is supported by fully committed bridge financing, and we remain committed to maintaining an investment-grade rating. At close, we expect the combined group to have leverage of approximately 3x net debt to adjusted EBITDA, and we expect to reduce leverage to approximately 2.5x within 18 months post closing, all while continuing to target a similar dividend policy to what Ingredion has had in the past.

Overall, it delivers a compelling combination of strategic fit, financial discipline and the potential for long-term value creation. Now before I turn to the next slide, I would like to touch on some details with regards to the next steps of the U.K. takeover process, which the transaction will follow, which is governed by the U.K. City Code on takeovers and mergers, otherwise known as the U.K. Takeover Code. The acquisition will be implemented as a court-sanctioned scheme of arrangement. This requires, amongst other things, the approval of the scheme by a majority in number of present and voting Tate & Lyle shareholders who must also represent at least 75% of the votes being cast at a meeting of shareholders ordered by the English High Court. It is worth noting that Tate & Lyle's largest shareholder, Huber Equity Corporation, has provided an irrevocable undertaking to Ingredion to vote in favor of the scheme, subject to the terms of the undertaking.

The acquisition is also subject to the satisfaction of certain regulatory conditions, which are set out in the Rule 2.7 announcement, which will be available on Ingredion and Tate & Lyle's respective websites. A scheme document further containing further details and terms of the acquisition will be published within 28 days of today's announcement. I would now like to turn to the strategic rationale and why this combination significantly strengthens Ingredion's long-term growth potential. The acquisition of Tate & Lyle strengthens our ability to service our customers around the world more reliably and more cost effectively. It also creates a differentiated go-to-market platform for texture solutions, sugar reduction and fortification, underpinned by exceptional technical capabilities. Let me walk through these 3 strategic capabilities one by one.

Post closing, we will operate approximately 65 manufacturing facilities globally, supported by a network of over 50 idea labs and innovation centers with more than 800 scientists and approximately 2,700 granted and/or pending patents. That scale matters because while many of our customers increasingly operate globally, their formulation needs are highly localized. They desire innovation partners that can help them develop solutions for local and regional tastes that meet consumer preferences and regulatory requirements. With this transaction, we will have broader manufacturing capabilities, a larger innovation network, enhanced local-for-local service and deeper technical resources across North America, EMEA and Asia Pacific.

Across the food and beverage industry, several trends continue to shape product development and innovation. Consumers are looking for healthier products with reduced sugar, more protein and fiber and simpler labels with better nutritional profiles. They also continue to expect great taste and texture that provides an overall enjoyable eating experience. Affordability continues to remain a key consideration for both consumers and food manufacturers. The acquisition of Tate & Lyle strengthens Ingredion's ability to address these trends. Post transaction, we will have expanded capabilities across sugar reduction, protein and fiber fortification, texture and mouthfeel with the opportunity to better assist our customers in developing products that are healthier, better tasting and are appealing to value-conscious consumers.

The combined group will be positioned to address the just described needs through complementary solution platforms. In Texturants, we bring together a broad range of texture solutions, including native and modified starches, functional texturizing systems and clean label ingredients. And these capabilities help customers improve mouthfeel, stability, consistency and overall product performance across a wide range of food and beverage applications. For sugar reduction, the acquisition significantly expands our sweetening toolbox.

Ingredion will be able to offer solutions spanning Stevia, Sucralose, Allulose and Polyols, allowing customers to reduce sugar while maintaining taste, functionality and consumer appeal. In fortification, we strengthened our ability to help customers improve nutritional profiles through protein and fiber systems, prebiotics and nutritional blends. These capabilities are increasingly important as consumers seek products that support health and wellness goals without compromising on taste or convenience. And lastly, within our Texturants platform, Tate & Lyle adds a complementary hydrocolloid portfolio of Pectins, Carrageenan and Guar Gum that combines with our starch capabilities to create one of the most comprehensive texturizing toolkits in the industry.

Taken together, these platforms strengthen our ability to deliver more complete formulation solutions for customers. Turning to the complementary capabilities of our solutions business. We expect the acquisition to further grow our higher-value portfolio through our solutions-led growth model. We spoke about how Tate & Lyle's capabilities expands our solutions toolbox, broadening portfolio coverage and enabling more integrated customer solutions. It also strengthens customer partnerships through deeper co-development and shared category expertise while scaling innovation and formulation to accelerate and optimize speed to market.

Furthermore, it extends our solutions capabilities across a larger global platform, enhancing our reach, relevance and ability to serve customers around the world. We believe this creates a clear path to value creation through solutions-led growth and supports a higher value mix across the portfolio over time. And when we connect these expanded solutions capabilities with our innovation platform, customer relationships and global reach, we strengthen what we call our customer-centric flywheel, which I'll discuss on the next slide. One of the things we find most compelling about this acquisition is how it strengthens our customer-centric innovation model. We think about innovation as a continuous flywheel that starts with understanding consumer and customer needs, translates those insights into differentiated solutions and ultimately brings those solutions to market through customer -- close customer collaboration.

And this transaction truly strengthens every part of that flywheel. Ultimately, the combination enhances our ability to move from insight to innovation to commercialization more quickly and more effectively, helping customers bring differentiated products to market. Just as importantly, this transaction brings together 2 organizations that share a strong cultural foundation and common values, which will be an important advantage as we move forward. Both Ingredion and Tate & Lyle are purpose-driven organizations that put customers at the center of all that we do. We share a commitment to innovation, operational excellence, sustainability and creating long-term value for all of our stakeholders.

We also share similar values around empowering our people, fostering an inclusive culture, acting with integrity and an owner's mindset while working together to deliver results. Importantly, both organizations believe that growth and innovation go hand-in-hand with helping customers meet evolving consumer needs and creating a better future through the science of food. While acquisitions are ultimately about strategy and value creation, they are also about people. The cultural alignment between Ingredion and Tate & Lyle will be an important advantage as we bring these organizations together and build the next chapter of growth.

With that, let me turn it over to Jason, who will discuss the financial framework.

Thank you, Jim. We believe this transaction enhances our financial profile and creates multiple avenues for value creation. On a combined basis, Ingredion and Tate & Lyle have generated approximately $10 billion in revenue, $1.8 billion in adjusted EBITDA, $1.4 billion in adjusted operating income and approximately $600 million in annual capital expenditures, a financial profile, which we anticipate to be further improved through synergy upside. One of the main reasons we are confident in this transaction is our proven track record of successfully integrating acquisitions and realizing synergies. Over more than a decade, we've completed a number of strategic acquisitions that have expanded our capabilities and strengthened our position in higher-value ingredient solutions, including National Starch, Penford, PureCircle, Western Polymer, TIC Gums and KaTech, among others. Each of these transactions has helped advance our transformation into a more solutions-oriented company.

And throughout those integrations, we have developed a disciplined and repeatable playbook across planning, execution and value creation. Our integration philosophy is straightforward and begins and ends with ensuring business continuity for customers and employees. We also focus on adopting a best of the best approach from the combined organization across talent, systems and processes and through optimization of operations, all of which create opportunities to accelerate growth. Importantly, this is not just about cost synergies. It is also about bringing together complementary capabilities, retaining key talent and creating a stronger platform for long-term growth. We believe Tate & Lyle is an excellent strategic fit for Ingredion, and we intend to apply the same disciplined integration approach that has served us well in prior transactions.

Turning to synergies. We have identified approximately $130 million of annual run rate net cost synergies that we expect to achieve by 2030. Approximately 60% of the opportunity is expected to come from SG&A synergies, including the elimination of public company costs, organizational simplification and other back-office savings, including IT expenses across the combined group. The remaining 40% is expected to come from COGS synergies, driven by procurement savings and optimization across manufacturing and supply chain, including logistics and warehousing, streamlined network flow and greater scale. We also expect to incur approximately $175 million of onetime cash costs to achieve these synergies, which we believe is a highly attractive investment given the opportunity for long-term value creation.

Additionally, we see further potential synergies coming from commercial cross-selling opportunities, optimized route to market, greater efficiency of capital spend and enhanced geographic presence as well as a more extensive innovation network. Overall, we believe this transaction creates a compelling balance of near-term financial benefits and long-term strategic growth opportunities. And while we are excited about the potential for value creation, we are equally focused on maintaining the financial discipline that has long been a hallmark of our company, which Jim will discuss on the next slide.

Thanks, Jason. As we evaluate any transaction, maintaining financial discipline is a top priority. At close, we expect the combined group's leverage to be approximately 3x net debt to EBITDA, and we are committed to reducing leverage to approximately 2.5x within 18 months after close. We have a strong track record of deleveraging following acquisitions, supported by our cash-generative business model and disciplined approach to capital allocation. Importantly, our financial priorities will remain unchanged.

We are committed to maintaining a strong investment-grade credit profile, allowing us to continue investing in high-return growth opportunities that deliver returns above our cost of capital and provide balanced and progressive returns to shareholders over time. To summarize, we believe this transaction represents a transformative leap forward into a larger differentiated and more solutions-oriented ingredients company, creating compelling value for customers, employees and all stakeholders.

And with that, operator, please open the line for questions.

[Operator Instructions] Our first question comes from the line of Kristen Owen with Oppenheimer. Our next question comes from the line of Andrew Strelzik with BMO Capital Markets.

You talked a lot about the strategic fit and the rationale, which I certainly get. But I was hoping you could talk about the trajectory of business fundamentals at tape and kind of what you're assuming moving forward. Obviously, we've seen estimates have come down a decent amount over the last year plus. So how are you thinking about kind of the underlying business trajectory for tape?

Well, we are very excited about the portfolio, and we have had an opportunity to do some limited due diligence through the process, and we're very impressed with the caliber of the leadership, the team as well as the strategy and the ideas. And we see an opportunity to bring complementary portfolios of ingredients, talent as well as supply networks that is really going to bring about the opportunity for synergies.

We think the work that Tate & Lyle has done over these last number of years to transform its portfolio has really been something that is not easy and the benefits of which take time to bear fruit. And we think the timing of this combination and the ability to bring urgency to the compelling inherent value proposition of the acquisition is going to accelerate the opportunity to execute on behalf of customers.

And so we think the way they've transformed their portfolio has made our interest in them that much more compelling and makes the complementary nature of the combination quite attractive and will enable the ability to execute on behalf of customers easier and more attractive. So we think that they're very well positioned now through this combination to accelerate their volume-led growth that I know that they have been committed -- committed to, and that was recently stated in their most recent full year earnings summary.

Okay. That was helpful. And maybe if I could just follow up. I think the regulatory side is going to be very top of mind for investors. So can you -- you talked a little bit about the overlap, but can you talk a little bit more about where the biggest overlap is and isn't? And ultimately, how you're thinking about the regulatory approval process, if divestitures might be needed? Just a little more color around that would be helpful.

Yes. Yes. What I would say, just to clarify, the strategic rationale is not really driven by product or customer overlap, but it's about combining complementary portfolios, technical expertise and geographic supply networks that expand Ingredion's ability to address customer needs across a wider range really of end use categories and applications. And together, this, we believe, is going to enhance our ability to better serve customers across a broader range of applications and end markets. We remain confident in that strategic rationale. And of course, we're committed to explaining this and engaging constructively with regulators throughout the process.

Right now, it's really too early to speculate on specific outcomes or hypothetical scenarios in that regard. We're going to stay focused on completing the transaction, and we're confident that going forward, we're going to deliver significant benefits for customers. And again, very well prepared to engage constructively with relevant authorities throughout the review process.

Our next question comes from the line of Kristen Owen with Oppenheimer & Company.

I wanted to start first with the cost synergies. The $130 million that you called out by 2030, if you could maybe just give us a sense of how you're thinking about those synergies? And maybe I know you talked 60-40 in terms of the split, but maybe talk a little bit more about where some of the opportunities are. Obviously, Tate had its own cost mitigation efforts in place. Ingredion just exited from its cost to serve. So I'm just wondering how you're thinking about both the cadence and then maybe potential upside to that synergy number as we get through the transaction.

Yes. This is Jason. I can field that one. So as we stated in the prepared remarks, we have identified about $130 million of annual run rate net cost synergies -- we expect to achieve those by 2030, and there's approximately $175 million of onetime cash cost to achieve those. Where we're looking at the COGS piece is really procurement savings, network flow optimization, logistics and warehousing.

And then on the SG&A side, it's really areas of overlap in corporate and support functions, which are really expected to drive savings versus creating any disruption. It's probably also important to say, we haven't identified any material dis-synergies as part of the integration planning, given the complementary nature of the 2 portfolios and the geographic footprints. We're going to obviously carefully sequence the integration to maintain customer continuity and business momentum, and we're going to try to minimize any potential near-term friction.

And the only thing that I would add to what Jason said is that, again, everything that we've identified are run rate cost synergies, and we have not factored in any revenue synergies.

And to your point about potential upside, obviously, as this is what we've identified in the initial phases of the work. So as we continue to move forward with the integration, we'll obviously be looking for other opportunities to identify additional.

Okay. That's helpful. And then, Jim, you kind of got to the heart of my next question, which is on the top line synergies. I mean, in particular, I'm sort of interested in how you think about the hydrocolloids business and just the general expansion of the toolbox on the texture side. Maybe help us quantify what sort of TAM that combined portfolio could unlock.

Yes. We're very excited about that opportunity. As you know, Kristen, we have been focused on unlocking the potential of texture and the impact that it has on overall liking. At the same time, Tate has been developing its understanding of mouthfeel. And this cuts across all different types of food types. So you have high moisture foods, intermediate moisture foods, low moisture foods. Tate's mouthfeel understanding, maybe a little bit more skewed towards higher moisture foods, our understanding across all the various dimensions. And Tate & Lyle's acquisition not that long ago of CP Kelco, which is a storied franchise and leader in the hydrocolloid space complements the overall ability to structure water in ways that enhance overall sensory preference for foods alongside of starches.

And that overall texturizing market is very large, and it's, I believe, a $20 billion market. And so we believe the combination of their hydrocolloids portfolio, along with our specialty starch portfolio really does expand our problem-solving toolbox to, again, structure water in ways that we can influence overall consumer preference and enjoyment when it comes to formulating healthier foods that still have to taste great or formulating more indulgent products for consumers that are looking for those enjoyable eating experience and moments in time.

So we're very excited. We actually really believe this is going to enable us to help our customers create the future of food aligned with trends of health and wellness, authenticity and affordability. And it's just tremendous new possibilities that we're going to be able to unlock with this combination.

Our next question comes from the line of Josh Spector with UBS.

I wanted to follow up again just on some of the cost synergies and specifically procurement. I guess our understanding is Tate has a long-term offtake agreement for a lot of their starch products from Primient. And I mean, I guess they produce most of their gums, you guys buy most of your gums. Just wondering where kind of that procurement savings really comes from.

Yes. I don't believe Tate & Lyle secures starch necessarily from Primient. They source other unique specialty ingredients such as fibers from Primient, not necessarily starches. Also CP Kelco is vertically integrated in relationship to hydrocolloids. And collectively, we source from a variety of suppliers in hydrocolloids, but Ingredion is smaller in that regard. We're looking at procurement in certainly chemicals, packaging, freight, logistics, warehousing, all in how you put out bids with more scale, providing procurement synergies.

Ingredion has invested significantly over the last 5 to 6 years in building out a global procurement organization. And we believe that the capabilities and muscles that we've developed there, folding that in with Tate & Lyle's procurement operations are going to give us more scale to procure more efficiently and effectively in all of that regard. So travel, et cetera, we just think that, that's where the majority of the synergies are going to come from on the procurement side.

Okay. And I mean, I don't know if you can get into the details on this call. I may need to follow up, but I'm having trouble getting to your 15% year 1 accretion using what consensus estimates are for Tate, assuming $5 billion of debt, maybe at a 6% rate and then assuming minimal cost savings in year 1, is anything in that very off? I'm getting to about 1/3 to half of your number.

It may be more efficient to take that offline just so we can kick the tires on what you're looking at. But we're comfortable with our calculations. We've done a lot of work on it and have to be well prepared given the takeover code in the U.K. So we believe that we've appropriately presented that. So maybe we can take that offline.

Yes, we can have a separate call and do a walk-through of the bridge and the building block to get to what is, we feel confident greater than 15% EPS -- adjusted EPS accretion 1 year, calendar year after the deal closes, the effective date.

Okay. Yes, I could maybe try a couple of quick ones then to follow up here is just are there any break fees with this deal? And if there are divestments, is that $130 million still the achievable number? Does that get adjusted?

Yes. The $130 million does not get adjusted, and there are no break fees.

Our next question comes from the line of Ryan Lavin with Barclays.

This is Ryan on for Ben today. I wanted to dig a little bit more into the leverage and balance sheet. So you give the 3.0 target following the close of the transaction and gave yourselves about 1.5 years to get it down to 2.5. You had said that the dividend policy is going to stay relatively stable. So with that, am I to assume that there's going to be some level of a reduction in CapEx? Or is there something else here that's going to help you drive the leverage turn alongside those cost synergies?

Yes. I think if you look at our capital structure and how we invest, we're always focused on growth CapEx first. So that's kind of the primary. And then obviously, returning value to shareholders through the dividend. After that, we look at reliability, capital and continuing to maintain the plants. I think where you're going to see the changes after we've accounted for those allocations, then we're looking at share repurchases and M&A. Obviously, this will be the focus for the next few years. So we'll be allocating less towards M&A. And then opportunistically looking for share repurchases, but clearly, we'll have other capital priorities. Both businesses generate solid cash flow, and that's why we believe we can quickly deleverage over the next 18 months.

Our next question comes from the line of Heather Jones with Heather Jones Research LLC.

I was just wondering if you all have done any work yet or able to offer us a sense of how this would change the combined company's growth profile? I mean, do you have a sense of what a long-term growth algo would be for EBIT or EBITDA for the combined company?

Yes. That's a body of work, obviously, that we'll do during the 12-month planning period, and we'll be prepared to communicate at the appropriate time. I think both companies are Texture and Healthful Solutions growth outlook, the revenue and the operating income and the targets that we most recently put out, along with what I think Tate had as their growth outlook for a business that predominantly will fit in our texture and healthful solutions are similar in ways.

So we'll continue to unlock that and do our planning. And again, what I mentioned is that our synergies are predominantly exclusively the $130 million on the cost side. There will obviously, we expect be revenue synergies, and that's one of the things that I think we'll take our time on and then that will be factored into the combined growth outlook that we'll put forward shortly after the effective date of the combination closing, the deal closing.

Okay. And then a follow-up on a question that was asked earlier, but just looking at Tate's numbers over the last couple of years and looking at the fiscal '27 projections, it looks like EBITDA margins have contracted a couple of hundred basis points. So I was wondering, I'm clearly not as familiar with their business as I am with you. And just wondering if you could give us some color as to what's driven that contraction? And is that expected to stabilize? Or just how we should be thinking about that?

Yes. I think that the volume growth has been somewhat challenging, I think, for Tate & Lyle. And that's one of the areas that I think was addressed on their most recent earnings call about the investments that they're going to make to drive volume-led growth. And that's one of the things we're most excited about the combination where there definitely will be synergies in the way we go to market and with the enhanced customer reach and the geographic reach, we think that's the opportunity to help address the volume-led growth where they were going to make some targeted organic growth investments.

And -- there also, I think, maybe were some mix-related matters there as well, but that's where the solutions-led combination, which is at its essence about margin accretion. And so that's, again, what makes the combination so compelling is we genuinely believe that together, we can achieve more than what either company could achieve on its own.

[Operator Instructions] Our next question comes from the line of Ben Klieve with Benchmark [indiscernible].

A couple of questions on the overlap. Clearly, there's a lot of synergies that you guys outlined, but I'm curious if you can elaborate a bit on where you think the most pronounced overlap is with the combined company, either from a kind of a customer capability, geographic standpoint?

Yes. Again, I wouldn't characterize it as product and customer overlap, but complementary the complementary nature of the product lines. Again, in the case of texturant, which we got asked earlier, Tate & Lyle's acquisition of CP Kelco creates leading positions in Pectin. Ingredion does not have any Pectin. Carrageenan, we don't have any Carrageenan to speak of, [ Gellan gum ] and products such as that. So those are nice portfolio complements. Protein fortification. Ingredion is a leader in plant-based protein with pea protein isolate.

Tate & Lyle is a leader in fiber fortification and soluble fibers. Ingredion does not have much in the way of soluble fibers. So all of these are compelling complementary elements. Also, the geographic supply network is, I think, incredibly important for customers on what they're looking for from trusted suppliers that have redundancies in their network to assure more reliable supply. One of the things that the pandemic exposed is the frailty of the global supply chain network. And so we believe that the very strong position that Ingredion has in South America, which Tate & Lyle doesn't have as long of a heritage and history. Ingredion, we talked about it, I think, at the Investor Day was -- is more than a 90-year history in South America.

Tate & Lyle does not have that history there. These are real compelling geographic complements that on behalf of global multinational customers that are nervous about the frailties in the supply chain from everything that the industry endured going back to '21 and '22 and now with what's happening in the Middle East, they're really interested in a trusted, reliable supplier that has redundancies that can get product to them under any set of circumstances. And that's the other thing that really, I think we're very, very excited about on behalf of customers, not -- and of course, the whole innovation capability side and what that unlocks.

Got it. Very helpful. And then you touched on my follow-up question, which is around the global manufacturing footprint and redundancies. And I'm wondering, maybe it's too early to answer this, but to the extent to which you observe likelihood of facility consolidation to maybe kind of reduce the pro forma maintenance CapEx spend that the combined company would have.

Yes, that will all be part of our 12-month planning work that we're going to do. We do believe that there will be opportunities in the cost synergies numbers that we put forward to look at not just corporate costs, but how to optimize that supply network. We do think there will be procurement synergies, certainly on CapEx, but also CapEx synergies that will come also just by bringing together the ingenuity of both companies on how to avoid CapEx spend in certain circumstances.

We're confident that -- and we're very, very impressed during the due diligence work that we did and the engagement we had with the Tate & Lyle management on their knowledge of the industry, their knowledge of their business and their network. And we're very confident that together, good ideas are going to come out and they are going to lead to savings and efficiencies and effectiveness.

And I'm currently showing no further questions at this time. I'd now like to hand the call back over to Jim Zallie for closing remarks.

All right. Thank you, operator, and thank you for joining us this morning. In closing, we are excited, and I think that's an understatement about the opportunity to bring these 2 great companies together. And I believe the transaction will strengthen our portfolio, deepen our customer capabilities and create vast benefits for our shareholders and other stakeholders. As always, I want to thank you for your continued interest in Ingredion on what was a very, very important day for us. Thank you so much.

This concludes today's conference. Thank you for your participation. You may now disconnect.

[Presentation]

Good morning, and thank you for joining us today, both in person and online. Sarah and I are pleased to announce and present Tate & Lyle's results for the year ended the 31st of March 2026. Before we start, I want to acknowledge that a week ago, we made an announcement under Rule 2.4 of the U.K. Takeover Code in which we confirm that Ingredion has made a conditional proposal to acquire Tate & Lyle.

Details of the proposal are on the slide. At this stage, there can be no certainty that any offer will be made nor as to the terms of such an offer. Clearly, we can't say anything more than we said in our announcement last week. So today, I'm purely going to focus on our results and the encouraging progress our business is making.

We have 4 key messages for you today. Firstly, the integration of CP Kelco has been successfully completed. And the entire Tate & Lyle team is focused on delivering on our priority of volume-led top line growth. Secondly, our full year results are in line with the revised guidance we gave in October, with performance impacted by muted market demand. Thirdly, we are making good progress on the strategic actions we set out in November to drive top line growth and strengthen our performance. Finally, with the integration of CP Kelco complete, our focus is on leveraging the power of the combination to accelerate growth. What's encouraging is that the combination is starting to gain real traction with our customers. And as we move into the new financial year, we are seeing early signs of top line momentum.

Let's start then by looking at the first of those key messages in more detail. Integrating 2 large global businesses is always challenging and takes focus and time. The fact that the integration has gone smoothly and has been completed without disruption to our customers is a testament to the energy and commitment of all our colleagues. The integration was made more challenging by both softer market demand than we expected and a complex geopolitical environment, notably the evolving tariff situation last year. While successfully completing the integration in these circumstances, was a significant achievement. Our financial performance was disappointing.

As we move into the 2027 financial year, we are determined to put that right. Looking forward, our #1 priority is to deliver volume-led top line growth. That's why when we renewed customer framework agreements for the 2026 calendar year, we selectively chose to drive volume and revenue growth. We are also acting at pace to deliver on the 4 strategic priorities we set out in November, and then I will come back to these in more detail later.

Finally, we continue to operate in a highly unpredictable geopolitical environment. And as we have done in the past, we will look to navigate whatever external challenges we face. Overall, our performance -- our focus is on delivering top line growth and stronger performance. With that, let me hand over to Sarah to talk through the financial results.

Thank you, Nick, and good morning, everyone. I'd like to remind you that I will focus on adjusted measures and items with percentage growth are in constant currency. Comparatives are pro forma unless I indicate otherwise, as if the acquisition of CP Kelco had completed on 1 April 2024.

Before I start, I want to describe our performance in the round. Despite a challenging year, we saw solid performance in our largest market of North America, encouraging [ resort ] performance in Asia Pacific despite the impact of tariffs. Specific challenges affected us in Europe, where we're impacted by lower bulk sweetener revenue and in Latin America, where we saw lower sweetener volumes. It's encouraging that around 2/3 of the portfolio continued to grow. The challenge moving forward is to build on the early signs of top line momentum that Nick talked about earlier.

That all said, our overall financial performance last year was disappointing, and let me take you through the headlines. On a statutory basis, including the impact of the acquisition of CP Kelco in November 2024, revenue was 16% higher and adjusted EBITDA was 13% higher. On an adjusted and like-for-like pro forma basis, muted market demand led to 3% lower revenue, and we delivered EBITDA of GBP 415 million, also 3% lower, in line with the revised guidance we set out in October last year.

Adjusted profit before tax was 5% lower at GBP 238 million, and adjusted earnings per share were 40.4p on a reported basis. We delivered GBP 164 million free cash flow with cash conversion of 70%, slightly below our target. Given lower earnings, the Board is proposing to hold the full year dividend flat, maintaining a healthy dividend yield. This chart shows the key drivers of lower revenue.

Volume and mix impacted revenue by GBP 34 million, with some mix improvements more than offset by volume declines. We invested GBP 33 million in pricing, such that overall, revenue was 3% lower in constant currency. There were some specific challenges which impacted performance. Approximately 20% of the revenue decline was from our bulk sweetener business in Europe. Over time, as demand for fiber grows, we will transition that bulk capacity into specialty products. But until then, its role is to help absorb fixed costs. It is likely to continue to be just less than 1 percentage point drag on growth in this financial year.

Softness in the sweetening market in Latin America, notably in Mexico accounted for a further 30% of the top line decline. Looking into the coming year, any further softness should be offset by growth of other ingredients. Elsewhere in the portfolio, we saw more resilience, including CP Kelco ingredients growing volume on broadly flat pricing and a more encouraging performance in Asia Pacific.

Turning now to the performance of our geographic segments, where, as I mentioned earlier, the underlying performance is more reassuring than the headline figures may convey. In the Americas, revenue was 3% lower, with EBITDA 4% lower. While pricing was broadly flat, volume was lower. As just highlighted, much of this underperformance was in Latin America for sweeteners. Encouragingly, in the U.S., despite muted market demand, notably in beverage, bakery and snacks, revenue was stable.

In Europe, Middle East and Africa, revenue decreased by 5% and EBITDA by 6%. Volume was flat, while pricing was lower. We came into the year expecting lower pricing, reflecting our decision to invest in price back into the market, particularly in Europe, in customer framework agreements for the 2025 calendar year. Performance across our core categories was varied with positive demand in dairy and beverage, somewhat offset by softness in soups, sauces and dressings. As previously stated, bulk sweeteners in Europe was the principal driver of revenue decline in the region, driven largely by lower sugar pricing.

Asia Pacific delivered robust performance, with revenue broadly in line despite tariff pressures and EBITDA was up 9%. Our North Asia business continued to grow well, while our China business was flat, reflecting the challenging tariff environment since July '25. Looking ahead, we see encouraging momentum as the power of our combined business and solutions offering increases customer engagement.

Moving on to EBITDA, which was 3% lower on a constant currency basis. EBITDA decreased as a result of the lower volumes and investment in price. COGS increases were broadly offset by $53 million of productivity gains, whilst the incremental growth investments were more than offset by cost and synergies, lower sales incentives and focused cost discipline. Our EBITDA margin on a constant currency basis was broadly flat. The reported margin of 20.7% remains attractive and well positioned compared to our specialty ingredient peers.

Now turning to other lines on the income statement. On exceptional items, net pretax exceptional charges were GBP 45 million largely driven by CP Kelco-related integration costs and the buyout of U.K. and U.S. pension schemes. Overall, there was a net GBP 48 million cash outflow associated with these one-offs. The adjusted effective tax rate was 23.9%, up 130 basis points. This increase is due to CP Kelco's operations being located in higher tax jurisdictions. We expect the adjusted effective tax rate in the 2027 financial year to be in the range of 23% to 25%. The Board remains committed to a progressive dividend policy to grow the dividend when earnings allow and to hold dividends in other periods. Given the reduction in earnings this year, the Board is recommending a final dividend of 13.2p per share, bringing the full year dividend to 19.8p in line with last year.

Turning now to free cash flow, for which comparatives are as we reported a year ago. Overall, free cash flow was GBP 164 million, some GBP 26 million lower than the prior year. Reported adjusted EBITDA was GBP 34 million higher, net working capital change by GBP 51 million. The majority of this movement related to higher inventory to mitigate the impact of tariffs on the supply chain and support customer supply continuity where we manage the consolidation of bio-gums capacity. I will talk to this more later.

Receivables also increased given extensions in the terms of framework agreements with some customers to support our volume-led growth priority. Capital expenditure was GBP 4 million higher at GBP 125 million. For the 2027 financial year, we expect capital expenditure to be in the GBP 110 million to GBP 130 million range. Net interest increased by GBP 26 million to reflect higher borrowings following the acquisition of CP Kelco while cash taxes and other items fell by a similar amount benefiting from in-year tax reimbursements and lower taxable earnings.

Our balance sheet remains robust. Long-term debt financing is in place at a competitive mix of fixed and floating interest rates and with a well-balanced range of maturities running out to 2037. We continue to target long-term leverage to be between 1 and 2.5x net debt to EBITDA, and our leverage stands currently at 2.3x. Net debt at 31 March was GBP 939 million, a GBP 22 million reduction.

At the end of October last year, we entered a $180 million 2-year term loan facility in drew it down. These funds were used to repay an expiring $180 million U.S. private placement fixed rate note on maturity. Consequently, our weighted average cost of debt is currently 4% with a weighted average maturity of 4.7 years. And we put a slide in the appendix illustrating our maturity profile.

We continue to have strong liquidity with an access to nearly GBP 1 billion through cash in hand and a committed and undrawn revolving cash credit facility of $800 million, which we have recently extended to 2031. We have good financial stability providing attractive optionality to support future organic investment and return of capital to shareholders.

I'll now hand back to you, Nick.

Thank you, Sarah. Moving now to the good progress we are making on the actions we set out in November to drive top line growth and stronger performance. By way of a reminder, these actions are focused on 4 priorities: the first is targeted investment to accelerate customer wins in key growth areas. Second is delivering the benefits of the CP Kelco combination. Third is accelerating productivity and lastly, to strengthen our balance sheet and deliver shareholder returns.

Let me start with the first priority. We continue to make a series of targeted investments to ensure we have the insights capabilities resources and tools we need to win with our customers. Given our significantly expanded portfolio and solutions offering, over the last few months, we've undertaken a detailed customer segmentation exercise which has characterized our customers into 4 distinct groups: partner accounts, enterprise accounts, accelerators and core accounts.

We are taking the output from this exercise and realigning our customer-facing teams, including our sales, technical services, applications and marketing teams to focus on those customers and subcategories where we can accelerate growth. Alongside this segmentation exercise, we are recalibrating which customers are best served through distributors. To ensure we have the capabilities in our global and regional teams to capture this growth, we are increasing our investment in areas such as applications, sensory science, nutrition science and process development.

We are also accelerating the rollout of our solutions chassis program to speed up customer innovation. Eight chassis, mainly for mouthfeel solutions were launched during the year. Meaning we now have 18 chassis available in the market with a further 9 in development. To accelerate their adoption we trained over 300 colleagues during the year, supporting the delivery of many customer projects across our core categories. We also continue to selectively invest in technology to enhance the effectiveness and agility of our customer-facing teams. We have invested in developing a new generative AI tool with the ability to search our broad technical and scientific libraries to provide faster and deeper insights for our sales and technical teams as they develop solutions to solve customer formulation challenges.

The rollout of this new tool started in February and is already having a positive impact on how we serve our customers. We are also working to improve our customer relationship management tools. And this year, we will implement a single integrated platform, which will improve the visibility of pipeline progression, technical resource allocation and enhance our sales team's performance management.

Moving to our second priority, which is to deliver the benefits of the CP Kelco combination. We are targeting revenue synergies of 10% of CP Kelco's revenue or around $70 million by the end of the 2029 financial year. While it's still early days, we are making good progress with around 10% of our target delivered to date. Cross-selling, which is the sale of CP Kelco's ingredients and solutions to Tate & Lyle customers and vice versa is a key way we will deliver these synergies. It's therefore pleasing to see the value of the cross-selling pipeline more than doubled in the second half and now stands at over $100 million.

I'm now going to hand back to Sarah to talk about cost synergies and productivity.

Thank you, Nick. When we acquired CP Kelco we targeted annualized run rate cost synergies of at least $50 million by the end of the 2027 financial year. As this slide illustrates, we have made strong progress in pursuit of this target. Last year, we delivered synergies of $24 million, predominantly people related, but supported by indirect cost savings and some procurement benefits. The annualized run rate of these actions already taken means we have now met our target of $50 million, 1 year ahead of our plan.

Moving to our third action, which is increased productivity across the enlarged group. In addition to the delivery of cost synergies, I'm pleased to say that productivity once again showed excellent progress. We delivered a further $53 million of productivity savings in the year with $33 million of this coming from operational efficiencies and cost reduction and $20 million from procurement and supply chain. This brings our total productivity savings over the last 3 years to $144 million. In November, we announced that we're increasing our 5-year target of $150 million savings by the end of the 2028 financial year by an additional $50 million to $200 million. Given the strength of our productivity pipeline, we are confident we could reach that increased target.

Our productivity culture is deeply embedded across our global operations organization. And we recently launched a campaign to extend this productivity mindset across the entire organization. The success of the program is based on a very granular Six Sigma approach to driving productivity. This is illustrated by the breadth of projects we employed to deliver savings.

Last year, we initiated over 500 productivity projects, of which some 27 delivered savings of over $0.5 million each. Three examples of these larger projects are on this slide, process improvements at our sucralose plant is saving $1.4 million annually. Finding ways to increase airflow in the spray dry at our corn wet mill in Indiana is saving $1 million. and the optimization of ocean freight transit times is saving $1.2 million. A major productivity and cost saving project that is currently underway is the consolidation of our bio-gums production capacity. We had expected to see a financial benefit from this consolidation in the 2027 financial year of some $20 million. However, due to rescheduling, we now expect this financial benefit will be delivered in the 2028 financial year.

Turning to our fourth action to strengthen our balance sheet and shareholder returns. We remain very focused on cash generation. Our target is to achieve cash conversion greater than 75% each year while delivering our priority to drive top line growth. This year, we'll be undertaking a group-wide project to optimize our warehousing activities. We will also look to improve inventory management across the business. with the continued expansion of procurement and planning optimization tools as well as our operational excellence programs. Another area of focus is the disciplined investment of capital. We continue to bring rigor to the investment appraisal process and new capital investments need to meet attractive rates of return. Our capital allocation policy remains unchanged.

And with that, I'll hand back to you, Nick.

Thank you, Sarah. Moving to our fourth key message for today, which is how we leverage the power of the combination to accelerate growth. The combination with CP Kelco has created a unique customer proposition. This is based on 3 strengths. Firstly, we have the broadest Ingredion's portfolio and solutions toolbox across our 3 platforms. Secondly, our unique capabilities to formulate across our 3 platforms to provide the solutions our customers need. And thirdly, our unrivaled scientific and technical expertise.

We operate in a large and attractive market. The global specialty food ingredients market is around USD 70 billion with about $20 billion of this market addressable by Tate & Lyle's 3 ingredients platforms. In each of our 3 platforms, we have a market-leading position. In total, we have over 1,000 different sweeteners, starches, pectins, specialty gums and dietary fibers, all with their own different functional attributes or nutritional benefits. Each platform has a large addressable market. The sweetening and mouthfeel markets are already sizable and have significant growth potential given the food trends we are seeing. And the sugar still makes up around 80% of the global sweetening market, there is an estimated $3 billion of sugar replacement opportunity in addition to the $20 billion addressable market.

Whilst comparatively small today, the fortification platform also has significant growth potential, given increasing awareness of the importance of fiber in the diets. I will talk more about this opportunity later. All this gives me confidence that despite current market environment, despite the current market environment, the fundamental growth drivers of our business remain strong and continue to offer significant market penetration opportunities.

I see these coming from 3 areas. Firstly, societal trends such as population growth, heightened awareness of the link between diet and health and the continued need for convenience. Secondly, food industry trends with arguably the biggest opportunity being to reformulate ultra processed foods to improve their nutritional content. Other areas, which are, of course, interrelated include increasing demand for sugar and calorie reduction as well as fiber and protein fortification, cleaner labels and cost optimization in today's world. The third driver is capturing the benefits of the CP Kelco combination. In addition to delivering on targeted revenue synergies, this includes leveraging our expanded portfolio and enhanced technical capabilities with both existing and new customers, particularly our leadership in mouthfeel.

And also benefiting from our increased presence in the fast-growing markets of Asia, Middle East and Africa and Latin America. With the growth opportunity clear, our focus is on leveraging the power of the combination to drive top line growth. This will build over time, and I'm pleased that we are now starting to see that happen in the marketplace. Let me give you some tangible examples. A large customer in China wanted to improve the mouthfeel experience of one of its premium yogurt drinks, while at the same time developing a cleaner label.

We would have had difficulty providing the right solution before, but with our combined portfolio, a solution based on our CLARIA clean-label starch and pectin provided the answer. In the U.S., a customer wanted to create a new chocolate milk product with no added sugar, an organic certification and obviously provide a great taste experience for the consumer. Our technical team created a series of prototypes, which led to a blend of TASTEVA stevia sweetener and gellan gum, giving the customer the perfect solution.

In Europe, a large multinational dairy customer wanted to enter the high-growth meal replacement category for the first time by creating a plant-based product targeting on-the-go nutrition. The customer came to us and told us that the product had to have a creamy mouthfeel, a clean label and meet certain other technical requirements. In this case, a combination of CLARIA starch and gellan gum provided both a strong sensory experience and the required technical protein and mineral suspension.

Finally, in Latin America, a combination of sucralose and NUTRAVA Citrus Fiber provided the solution for one of our largest global accounts who wanted to optimize the cost of its ketchup and maintain its important mouthfeel characteristics. What's clear around the world is that customers are increasingly recognizing a much stronger solutions offering and the benefits the combinations bring.

Moving to look briefly at fiber, which we see as another significant growth opportunity. Fiber is a key nutrient for people at all stages of life. Awareness is increasing of the importance of fiber in the diets with 58% of consumers in the U.K. saying they plan to increase their fiber intake in 2026. But the reality is the intake remains low, with only 3% of U.K. adults getting enough fiber each day. We know that consumers cannot eat enough fiber purely from Whole Foods. So it's increasingly accepted that people will need to consume foods fortified with added fibers to close the fiber intake gap.

This is shown by a 13% increase in new products launched globally in 2025 with a fiber claim. Fiber is also very important for GLP-1 users. GLP-1s suppress appetite and so users can't and don't eat as much food. This means every bite counts when it comes to nutrition. We are increasingly providing solutions for customers, specifically targeted at GLP-1 users.

Let me give you just one example. In North America, one of our largest customers in the snacking category wanted to reformulate some of their products to make them healthier and directly target GLP-1 users. We created a solution using our PROMITOR and STA-LITE soluble fibers, which provided an additional 6 grams of fiber per serving and a front-of-pack fiber claim. The customer has now launched 4 products with the solution and has given us 3 new briefs to work on fiber fortification on other product lines.

The increasing traction with customers is showing through in the growth we are seeing in our new business pipeline. Last year, the value of our new business pipeline increased by 15%. Revenue from new products increased by 9% on a like-for-like basis. and revenue from solutions as a percentage of new business wins was 35%. While the market environment remains challenging, the progress we are seeing gives me real confidence that we're on the right track. And that we are well positioned to benefit as and when market demand improves.

Turning now to the outlook and summary. For the year ending 31st of March 2027, on a constant currency basis, we currently expect to deliver modest revenue growth underpinned by volume growth weighted to the second half and broadly flat EBITDA before the around $20 million impact of rescheduling the consolidation of bio-gums.

Our outlook currently assumes a limited impact from the conflict in the Middle East, but we are taking actions to mitigate cost inflation through a range of initiatives, including procurement activities, operational discipline and pricing action. So to conclude, with the CP Kelco integration complete, our priority is clear. to drive volume-led top line growth, and we are seeing early signs of progress. We are making good progress on the strategic priorities we set out in November and on leveraging the power of the combination to accelerate growth.

Over the last 6 years, the business has been repositioned to be at the center of the future of food. Today, we have a portfolio that is perfectly placed to address growing consumer demand for healthier, more nutritious and sustainable food and drink. The power of the combination is clear. And our focus now is on execution, driving top line growth and strengthening our performance.

With that, Sarah and I will be happy to take your questions. May I remind you that under the U.K. Takeover Code, we can't comment on anything relating to Ingredions proposal we announced last week.

We will take questions both from the floor and those joining remotely.

For the purposes of the recording, please state your name and institution. So with that, can we have the first question from the floor?

Can you hear me?

Yes.

This is Joan Lim from BNP Paribas. I just had a couple of questions. So you mentioned that your H2 weighted growth for 2027, what gives you the confidence that volume growth will recover? Are you seeing any trends in April and May as you spoke about some momentum to the start of the year? That's my first question.

Okay. So let me take that one. So what gives us confidence? A number of things. Firstly, we're seeing good momentum coming into the year. Q4 ended as we expected, which is obviously the first year of this calendar year. And we're seeing -- we saw good revenue growth in April as we started the year. So we started strongly.

Secondly, we always said that momentum would build through the year given the power of the combination amplifying. So the pipeline strength will grow through the year. The segmentation exercise and focusing our sales team on the customers we want to grow with faster will grow through the year as well the cross-selling pipeline. So that's the second reason.

The third reason is when you think about the shape of last year, we really started to get significantly impacted by tariffs in North America and to a lesser China in the second half. So remember, the North American slowdown in volume was weighted to the second half for us when we looked at the market. So we're starting to lap that as we go into the second year, into the second half in the sense that that's already -- the tariffs are already built into the base.

And then lastly, of course, as we build momentum with customers and the power of the combination grows. And remember, we've only just annualized the point where we put our sales teams together, we should see more momentum going into the contracting round for the following year as well. So it's really a combination of all of those things put together.

Okay. And for Americas, it still declined 3% in volumes. Why has beverages been weak? What are some of the ways you think you can outgrow markets?

So look, I mean, specifically in the Americas, we saw more weakness in sweeteners in Latin America. North America actually was relatively stable from a revenue perspective. I mean, ultimately, the repositioning of the portfolio and the growth of the new products in the portfolio and the newest sweeteners to offset some of that sweetness is what we'll start to see flow through this year.

And of course, we're lapping out of that now. So that's -- I mean, that's really the shape of it. And we're absolutely seeing the momentum in the new portfolio and the solution selling start to flow through. As markets stabilize, that will offset some of the declines we saw in the rest of the portfolio.

Next question in the room? Matthew?

Matthew Webb from Investec. The -- I wonder if you could just comment on the new product sort of development and launches in -- particularly in the U.S. but more broadly. And specifically, it feels like there's sort of 2, sort of, factors here. There's on the one hand, there's clearly a lot of change going on in consumer demand for different types of foods for different properties. But on the other hand, we still got quite a subdued consumer environment, which typically slows that process.

So I just wonder if you could comment on sort of where you think we are now in terms of the balance between those 2 and maybe how you see that playing out over the next sort of 12 months or so?

Good question. So let me start with North America because that's probably -- because it is still the biggest part of our business. It's clearly what we saw last year was a lot of noise around regulation, Maha, GLP-1, but all of which pointed towards healthier diets over time. And in our case in the business that we're in, reformulation to create better nutritional outcomes and lots of conversations with customers about what to do in that regard.

I've given you a very good fiber example in the presentation that led to launch of new products. Environmentally, though what happened last year was, you saw this massive impact to tariffs, significant consumer inflation, volume slowdown and a natural slowdown in innovation as well because people are trying to figure out how to manage those impacts. What we're now seeing is sort of as Maha starts to become a little bit clearer is real engagement in those trends that I've talked about.

I think the question is, as we see how the Middle Eastern conflict impacts overall consumer sentiment and demand. Do we see an acceleration in product launches or not? We're seeing -- definitely seeing an acceleration in conversations at what point in that translates into real launches and therefore, new business. So we're still watching to see how that evolves. Encouragingly though, we have seen momentum coming into the year, on the top line. And all of the indicators in the pipeline suggests that will happen over time. The question is what time.

And then second question, I don't know whether you're going to be able to answer this one, given the restrictions you're under. But just specifically on the delay to the bio-gums capacity consolidation, is that something that you have been aware of for a while long enough for Ingredion who have been aware of that in their due diligence and therefore, comfortable with that in terms of the offer that they've made?

There is no comment I can make on that specifically. No, I can't. I've got my handlers looking at me.

So why don't we go to a question online, and then I'll come back to the room. I think we've got Karel Zoete on the line. Karel, can you hear me?

Yes. I have a question with regards to the outlook, you say we kind of assume there are no real impact from the conflict in the Middle East. But can you discuss a bit what the higher energy cost mean for the cost base? And what you've seen in terms of demand trends?

And the second question is about reinvestment. You're optimistic about the savings and the synergies that are coming in. But at the same time, we see stable profit in the current fiscal year. So what are areas you say, this is where we really reinvest, which is holding back profit growth?

So what I take your first question. So on the Middle East, we've got limited exposure to the affected countries. So about 1% of our revenue goes in there. We're actually seeing a lot of customer demand still. And we're finding ways of shipping into the Middle East now through going through different ports, et cetera. So we are now shipping in.

And actually, I think we'll see that continue. And obviously, there might be a rebalancing of stocks. In terms of overall demand, as I said, we're seeing some encouraging signs coming into the year. So no real impact near-term impact on demand. In terms of costs, we've got a very rigorous hedging policy on energy. So we're well covered through the first half of the year. But there are incremental costs as we go through the balance of the year, and we're going to have to look to balance that off with productivity and procurement initiatives and selectively pricing and passing through things like freight costs where necessary. So we're assuming a limited impact in our outlook at this point.

I mean if you can predict what's going to happen tomorrow in the Middle East, I'll tell you what the impact is going to be for the full year. But currently, we're assuming a limited impact, and we're controlling the things that we can control. Sarah, I don't know whether you want to take -- say anything more specifically about energy and then take the question on the reinvestment versus the sort of the stability in earnings?

Okay. Thanks, Nick. Karel. So I think indeed, I think it's just to remind you that sort of, so energy is about 5% of our costs. And as Nick mentioned, we're well covered in this calendar year. I think in the near term, the freight costs, which, of course, is seeing some increase, that's a more straightforward conversation to have with customers.

But again, it's going to be considered in the around that #1 priority is growing volume-led top line. So I think we're watching and seeing very much in the near term. And then your first question about investments. So it's how do we ensure we have the right people and capabilities in the front line to support the volume-led revenue growth. So it's the people, but it's also training the people, the technology support the digital investments to support to give them even more confidence. So giving them the tools and the investments to give us confidence that we can grow the top line.

And of course, we're trying to offset some of that. We've talked about delivering the cost synergies. So you've got a $15 million, $20 million help into FY '27, but again, remember, there's always the drag on inflation. We want to reset sales incentives. So it's a -- we work really hard to try and stay still. But #1 priority in the organization is investing capability to give us confidence about top line growth.

Karel, if I take us back and just add one more point to that, which is the benefits of bringing the 2 organizations together is allowing us to reinvest in a more challenging environment than we had anticipated in the last couple of years and still maintain a very attractive earnings profile and margin structure in the business. So it's another example of the power of the 2 businesses coming together. It's giving us the flexibility that we might not have had as one business.

Let's come back into the room, any questions in the room? I think over here.

This is Artem from Rothschild & Co Redburn. One of the messages we get from the presentation is that the integration with CP Kelco is successfully complete I'm very keen to hear about your learnings about the new business after about a year or so.

Specifically, first about the portfolio. It sounds like some categories are performing better than others. Do you expect the underperformance to improve? Or do you see that a bit more structural? And secondly, about competition by region? Have you seen any unexpected intensification of competition in any particular region? That would be interesting to hear.

Sure. I mean, as you rightly said, we've said today that the integration is complete, and it's been very successful in what we've been trying to achieve. We've learned a lot and a lot of positives and a couple of learnings that we could maybe have done things differently. But what we've really learned is the power of the combination together makes a difference with our customers.

I mean, and our sales teams and our application scientists working together are creating things that we couldn't do before for solutions for our customers. And that's the underpin of our confidence in the medium term and the future of the business because that is the future of what we were trying to create this idea of a company that can really help with improving the nutritional content of food in a way that consumers are looking for.

And we can do things today that we couldn't do. The 4 examples I gave you, we couldn't do as the old Tate & Lyle. We can do as the Tate & Lyle. And that's giving us huge confidence in the future. We've learned a lot about the power of common cultures coming together. The benefits of the fact that both companies believe this was really the right thing to do, really stood us in good stead as we went through. An integration process that's never easy because you're changing your organizations.

I'd say the couple of things that we maybe learned that on the sort of more challenging side is, if I had my time again, I would probably accelerated the commercial integration because we spent 6 months putting that together and only started to face into customers as one in April last year, that was really doing that quicker, I think, would have been -- would have benefited what we're seeing today more, but hindsight is a wonderful thing.

And then, of course, as we've talked about, unfortunately, the significant benefit of the productivity investment that was made in bio-gums even before we acquired CP Kelco is taking longer to deliver than we thought. It's there, it's going to be delivered, but it's a phasing issue that is impacting the near term. But from everything we've learned, by far, the most important thing is a different view on us from our customers and the different capability for us to serve their future needs. And in terms of the medium term, that gives us huge confidence.

Can I -- I'll come back to you in a minute, Matthew, if I will. Because, Alex has been very patiently waiting online. So Alex, I'll come to you if you can hear us.

It's Alex Sloane from Barclays. Just the first one, just in terms of bio-gums, the $20 million impact. Could you give us a bit more color on maybe what's gone wrong versus your plan? And how confident you are that, that drag couldn't be worse than the $20 million this year? And just in terms of thinking about how that unwinds in '28, is it just the $20 million headwind that goes to neutral? Or is it kind of a swing to a $20 million positive, so more like a $40 million year-over-year swing.

That would be helpful. And secondly, just can you remind us in terms of the key terms of the Primient 20-year supply agreement, is there any change of control clause on either side? And can you maybe just remind us how much of Tate's current supply is sourced from Primient and versus what Tate still produces on Primient's behalf?

Sure. So let me take the second question first. So in terms of the Primient supply agreement, we've always said that it's a long-term agreement that survives change of control.

I can't say any more than that because that's all we've said in the public domain. I mean there is documentation out there that's available. And I'm being looked at again by my advisers. Obviously, the amount of our business that comes from Primient has to significantly decreased since the CP Kelco transaction. So it's much less than it was, but it's still an important part of our business.

In terms of the bio-gums, I wouldn't say anything has gone wrong. I mean sometimes when you're scaling up new technology. So we're going from kind of we're significantly scaling up the fermentation technology, and it's taking a little bit longer to stabilize the process and it's taking a little bit longer to reference new products with customers from the new technology. So it's just a phasing issue. We're 100% confident that it's going to flow through, and we're really clear about the phasing now in terms of when the delivery is going to happen.

And as we go into next year, Sarah can probably comment more on the numbers. but we're going to see a benefit of GBP 20 million for sure as we go in. And over time, that will increase. Is that...

Yes, absolutely. Maybe just to add. So as we complete this consolidation, that GBP 20 million falls away. And obviously, as we go through this year, we'll talk more about the outlook into FY '28.

Matthew, I said I'd come back to you.

Yes. This is also related to the bio-gums, but just a broader question on working capital guidance for next year. I think you've mentioned that the bio-gums delay will have some inventory implications. Obviously, in the year just gone, there were some issues that meant that you had to increase inventory levels. Just any overall comments and any specific number guidance would be very helpful.

Take that, [indiscernible]?

I would think so.

So yes, great question. So indeed, we have this GBP 50 million headwind in FY '26. Going into FY '27, that turns to a more neutral position. Because, yes, as we -- there's some continued build of the bio-gums, but also as we implement the sort of the tighter working capital management across the organization, we are confident that we can offset. So it will be a neutral impact for cash for FY '27.

Great. And then I fear the answer will be no. But on a purely factual basis without making any comments about competition implications, can you make any observations about the extent to which you compete directly with Ingredion in any particular categories on a purely factual basis?

On a purely factual basis, yes. In detail, no. We both make starches.

Would you like to elaborate?

No. At this stage, no. I'm sorry.

All right So let's go back on to online. I think we've got Matthew Abraham from Berenberg with a question.

Just looking to get a bit more color on the pricing that you've taken in response to the Middle East. Just looking to understand what specific markets and categories you've pushed pricing in and magnitude of pricing that you've taken in response to the Middle East impact. Also, just wondering a follow-up if there will be the opportunity for you to take follow-up pricing actions if the initial view of the limited impact from the Middle East is exceeded?

Sure. I mean so in simple terms, to answer your first question, to date, where we've taken limited pricing actions to offset freight costs primarily because that's the primary thing that's hitting our business. As we did in the Ukraine crisis. If you remember when that hit just after contracts have been renewed for the new year, we did revisit pricing as a result and successfully passed through. What at the time were very significant cost increases. We have that flexibility. We'll navigate and see how things evolve through the through the next few months to see if we need to do that or not. And the moment our focus actually on is recovering the freight costs we're seeing and continuing to maintain top line momentum.

Okay. Any more questions in the room? In the back there?

Priya from UBS. I just had one question. So on APAC, obviously did a lot better in terms of top line and EBITDA performance compared to the other regions. But you talk about some competition in parts of Asia due to excess capacity in China. I was wondering if you could give some color on which ingredients that you're seeing these oversupply pressures and how that plays out in 2027?

Yes. So the competition that we're principally referring to is there's still relatively muted demand in China. We're seeing stability but not significant growth yet. And across some of the portfolio, so things like sweeteners, and some of the gum business, there is competition out of China that is locally having some impact.

So I'll probably pick out those things as being the most significant and it's primarily on Xanthan not gellan gum.

Okay. Any more hands in the room?

Okay. Then if there are no more questions, let me finish, and I'll just finish with 3 final points. First, as I said, with the CP Kelco integration successfully completed, the entire Tate & Lyle team is focused on delivering volume-led top line growth and improving performance. Secondly, the power of the combination really is starting to gain traction with customers, and this is reflected in some early signs of top line growth as we come into the new year. And finally, longer term, we remain very, very confident in the future growth potential of the business. It's clear that consumer demand for healthier, more nutritious and sustainable food and drink is going to grow strongly, and our leading positions across sweetening, mouthfeel and fortification make us very well placed to capture that growth going forward.

So with that, thank you for joining us, both in the room and on the webcast, and we wish you all a very good day. Thank you.

Good morning, and welcome to the conference call for Tate & Lyle's Q3 Trading Statement. Your speakers today are Nick Hampton, Chief Executive; and Sarah Kuijlaars, Chief Financial Officer. I will now hand you over to Nick Hampton for some opening remarks.

Thank you, operator. Good morning, everyone, and thank you for joining this third-quarter conference call. I will start by making a few remarks on our performance and strategic progress, and then we'll open it up to Q&A. Trading in the third quarter was in line with our expectations and consistent with the first half. Our guidance for the full year remains unchanged. On a pro forma basis and in constant currency, revenue was 2% lower in the quarter, reflecting continued muted market demand with performance in all regions broadly in line with the first half. On a reported basis, which includes CP Kelco from the date of acquisition on the 15th of November 2024, group revenue was 15% higher.

For the 9 months to the 31st of December 2025, on a pro forma basis, revenue in the Americas was 2% lower, with modestly higher pricing more than offset by lower volume. In Europe, Middle East, and Africa, lower pricing resulted in 5% lower revenue. While in Asia Pacific, revenue was up 1%, driven by higher volumes.

Turning to the renewal of customer framework agreements for the 2026 calendar year, which is well advanced. With our #1 priority returning the business to top-line growth, we have selectively chosen to invest to drive volume and revenue growth. This is the right thing to do for the business, giving us a stronger platform for future growth, and we are pleased with the engagement from customers to our expanded offering. We are making good progress on the series of actions we set out at our interim results to drive top-line growth and improve performance. Let me give you 1 or 2 examples of progress. We continue to accelerate the rollout of our solutions chassis program with a focus on mouthfeel.

We launched 2 new mouthfeel chassis in the quarter, one to improve the stability of portable salad dressings and another to support egg reduction. The level of customer engagement on our enlarged portfolio remains high, with the value of cross-selling opportunities in our new business pipeline increasing by more than 1/3 in the quarter. Revenue synergies from the CP Kelco combination are growing in line with our expectations, and we remain confident that run-rate cost synergies will exceed our target of $50 million by the end of the 2027 financial year.

And finally, our 5-year $200 million productivity program continues to operate well, with further savings delivered in the quarter. Overall, then, I am pleased with the progress we are making. There is a real determination and focus across the business to deliver on the actions we are taking, and I am confident that in the near term, they will improve the top-line performance of the business. We will give you more detail of our progress when we announce our full-year results in May. At that time, as usual, we will also provide guidance for the 2027 financial year.

To conclude, with our leading positions in sweetening, mouth and [indiscernible], we remain well placed to benefit from the global trends towards healthier and more nutritious food and drink. With the breadth of our portfolio, our formulation expertise, and the targeted investments we are making to accelerate customer wins in key growth areas, we are well-positioned to drive profitable revenue growth over time.

With that, Sarah and I will be happy to take any questions.

[Operator Instructions] We will now take our first question from Karel Zoete from Kepler Cheuvreux.

I have 2 questions. The first one is in regards to the price investment you mentioned to sustain volume growth or to improve volume growth. Can you be a bit more specific which markets you decided to invest and what that might mean for pricing going forward? And the other question is around fiber. So I think more and more evidence or discussions in the public domain about fiber, fiber being the new protein, et cetera. What kind of engagement do you see with your customers on the fiber ingredients you sell?

Okay. Karel, let me pick up on the fiber question first. I think it's an important one, and I'll let Sarah handle the selective view on pricing. But I mean, fiber clearly is a big global trend. In fact, there was an article yesterday in Bloomberg about fiber maxing. And we're seeing very encouraging progress with customers on our fiber portfolio, both products going into market, notably in the U.S. market, where in both beverages and dairy, we're seeing fiber fortification as a trend, and increasing the pipeline for fiber is growing. But it's a global trend as well, and we're seeing that trend across Europe and Asia, too. And I expect that to continue as we think about the continued desire to create more nutritious processed food, especially in a world where people have a significant shortfall of fiber in their diets, and all of the nutritional trends we're seeing point towards fiber addition as a strong growth opportunity for us going forward.

Thanks, Nick. So when we think about our framework agreements, I think it's worth taking a step back, and we're all very aware that market demand remains muted. And as we stated, our #1 priority is to deliver the top-line growth. So that's volume and mix-driven top-line growth. So we've taken the decision to set our business up stronger for the future is that we're selectively investing to drive that volume momentum and the revenue growth. So we think about this is we're being very selective. So by product, by customer, by region, to ensure that we're setting ourselves up for that growth, given we now have the broader portfolio following the acquisition of [ Kelco ].

Our next question is from Ranulf Orr from Citi.

Just one for me. I mean you talked a bit in the past about the sort of 4Q improvement. Could you just provide a bit of an update on that? What's going well and where you have visibility on some of those sort of factors coming through?

You mean in the fourth quarter?

Yes, yes.

I just want to get clarity on the question. Look, so I mean, I think we're seeing encouraging signs of increased customer engagement on reformulation. It's very clear the sentiment in the market is our customers at least increasingly thinking about the need to put price back in to drive momentum. But we're not assuming any improvement in market outlook in the fourth quarter in our underlying guidance for this financial year. What we saw in the third quarter was consistent performance from the first half and very clearly in line with our expectations. And so far, as we've entered the fourth quarter, we'd say the same. Always as you go from Q3 to Q4 across the calendar year, you can get some kind of pluses and minuses between December and January from a phasing perspective. But we're seeing the kind of customer demand that we would be expecting, given the underlying guidance given for this year.

And just one more, if I may. On the price investments for the year ahead, can you give any kind of quantification or indication of the scale of those, maybe in relation to the current year?

Look, I mean I think we haven't finished yet because we're still closing out the renewal agreements for this calendar year. And we'll give you a precise view on that when we get to our May results, as things have settled down. But I think it's fair to say that a little bit more this year than we did in this calendar year than we did in the last calendar year to ensure that we're really driving momentum with key customers. And you're obviously offsetting that with real focus on productivity and the benefits of the combination coming through in both cost synergies and the revenue synergies, of course, let's not forget, this is now the second year of the new business. And this is the first year we're entering as one combined business.

We'll move to our next question from Joan Lim from BNP Paribas.

Quite a few of my questions have been asked, but maybe just could you provide more color on trends by regions and category, like for example, which category has been doing well, or you're seeing more uptake with customers. So you mentioned a bit about fiber. Is that more driven by innovation in beverages, for example, and supported by GLP-1 users taking more fiber? My second question is, do you have any indication of how FX will be like for the next year? And lastly, maybe an update on CP Kelco's volume and margin recovery, please?

Okay. So let me give you some headlines on the overall shape of what we're seeing in the market, and then maybe Sarah can pick up on the ForEx and the CPK question. I mean, overall, what we saw in the third quarter was quite consistent with the first half. In the Americas, we're seeing modestly higher pricing more than offset by lower volume. And that's very consistent with the Nielsen volume data that we saw in the first half, where you saw volume down and value driven by pricing, which was in part the pass-through of tariffs at the time, as you remember. And that's been pretty consistent. In Europe, volume pretty flattish volume mix with the pricing investment driving lower revenue. And then in Asia, encouragingly, some revenue growth driven by higher volumes, so some signs of momentum.

I think underlying that, though, I think it's important to say what we're seeing with customers in terms of trends is some clear benefits of the combination flowing through. So in the quarter, the cross-selling pipeline was up over 1/3, having been strong at the first half. And we're seeing double-digit growth in our innovation pipeline to customers. And that's driven by some key themes. So as we've already talked on the call, we're clearly seeing a focus on fiber fortification across many categories. And I think it may well be driven by this need for nutritional density, driven by nutritional needs for processed food and the GLP-1 point you made. We're seeing that especially in beverages and dairy in the U.S. In EMEA, we're seeing dairy and beverages being more resilient, Baker and snacks a bit softer. And in Asia, actually, overall robust category performance. We talked about recovery in China at the half driven by CPK.

Beyond fiber fortification, the other trends we're seeing is renovation for value. So cost efficiency and product renovation. We're also seeing continued focus on sugar reduction, and that linked to mouthfeel that we talked about at the half, where as you take sugar out, being able to control the texture mouthfeel of product is really important. And that's where the combination is really helping us build a stronger pipeline, which we expect to build as we go into next year.

Thanks, Nick. And the next question is about ForEx. So indeed, we saw a headwind of -- given the U.S. in the first 9 months, which is approximately 2% to 3% of revenue, and that we expect to continue. That is partly offset by the strength in euro. Remember, with the acquisition of CPK, we have a broader footprint. So there's also some impact of the Danish krona, et cetera. But overall, you expect a headwind in the sort of the 2% to 3% on the top line. That's a slightly higher impact on EBITDA given the important contribution from the North American and the profitable North American business.

Turning to CPK. So clearly, the integration continues to go well. cost synergies well in hand. And as Nick has spoken about now, obviously, the attention on the pipeline growth of those cross-sells. And it's been really powerful going into the conversations this year as a combined portfolio, punching up the combined commercial staff, really demonstrating the ability and the strengthening capability of the portfolio and the stronger [indiscernible].

Our next question is from [indiscernible] from Barclays.

So my question is on the selective investments. How should we think about the margin impact of these investments as we move into FY '27? Are you viewing this as a 1-year reset to drive volume recovery or a more structural change in pricing intensity? And my second question would be, regarding like to what extent can with the ongoing productivity program and CP Kelco cost and revenue synergies can offset the margin impact of these investments? Should we expect net margin pressure or stability as we bridge from FY '26 into FY '27?

Okay. So I think let me start by saying we'll give very clear guidance on fiscal '27 when we get to full year results. So we need to complete our planning process for next year and see how trading evolves in quarter 1 of the calendar year. But the way I think about it is if you think about the building blocks going to next year, we're clearly because of the market demand remaining muted, putting some selective investments into price to drive the top line, both volume and revenue.

Alongside that, we've got clear offsets from productivity delivery and accelerating the benefits of the CP Kelco combination. And different to last year, we've also got the benefits of the combination flowing through in terms of the pipeline and the cross-selling opportunities to support the framework agreement renewals. So we're confident that that builds a strong platform for growth. Where that leads us to on overall earnings delivery and margins, will be much clearer about when we get to our full year results. But the key here is the quality of the portfolio to build a growing pipeline of business with customers, as we see markets start to improve and the trends that are our friend from a positioning of the business perspective, we fully expect to drive growth going forward and into the medium term. And we'll give very clear guidance on the nearer term when we get to our results.

Just a follow-up on the fiber thing. Thanks for giving some color on that. So are you seeing a meaningful increase in customer briefs or RFP activity linked to high fiber formulations? And how does the current pipeline compare with the time last year?

So if you think about our pipeline in the last quarter, it grew double-digit overall. And that is driven by a focus on things like fiber fortification. I think the question always is at what pace of those pipeline projects convert into innovation in the market. And as you know, we've probably seen -- we haven't really seen an increase in innovation pace yet, but we're anticipating that coming as these projects start to flow through.

And Nick, maybe I'll just add, it's not simply just adding fiber to a product. With fiber, you really need the mouthfeel. And that's really where our sweet spot because you really need the appealing mouthfeel for the fortified product to be successful in the market.

We'll now move to our next question from Samantha Lavishire from Goldman Sachs.

I just kind of wanted to talk about some of the themes you're seeing in the market longer term. So we heard a lot of feedback at CAGNY last week about clean label reformulation, including away from artificial sweeteners like sucralose and several emulsifiers, some of which I think are in your portfolio. What proportion of products are being reformulated this way? And is the increased customer opportunity that you're seeing with CP Kelcos from fortification and protein and fiber, is that enough to offset this headwind? Are you still seeing structural growth in the way that customers are reformulating with your ingredients?

So thanks for the question. I mean all of those trends that we talked about at CAGNY this month actually play to the reshaping of the portfolio. And I think it's important to say that sucralose clearly is an important part of our portfolio as an artificial sweetener of choice, but it's growing in demand. And we're selling every kilo sucralose that we can make because it's the best-tasting artificial sweetener out there. It is also important to say that if there was a shift away from artificial sweeteners, we've got lots of non-nutritive natural sweeteners in the portfolio, everything from stevia, we're the only company with an all-American supply chain for stevia, for example, through to monk fruit and allulose. So we're well placed for the reformulation to more natural and clean label.

The emulsifiers actually are part of our portfolio. We do a lot of replacement of emulsifiers, and that's where the CP calc portfolio comes in as well. So one of the trends that we're seeing people talk about the trends we really believe the combination of our 3 core platforms can help customers win because that sugar replacement or artificial sweetener replacement that we talked about also comes with the need for modulation as Sarah just talked about. So the things that we heard from CAGNY are precisely the reason that we've repositioned the business the way we have done in the last 5 years.

We'll now move to our next question from Matthew Abraham from Joh. Berenberg.

Just first one relates to the fiber fortification services you touched on. Just wondering if you can provide a sense of the margins from those services relative to the rest of the group. If fiber demand does accelerate meaningfully, could there be a broader impact on overall group margins? And then the second question just relates to the price investment commentary that you provided. Is that a reflection of a perception of improved demand elasticity? Or is it more a reflection that demand is such that it requires stimulation through price investment?

So on your first question on fiber, our fiber portfolio generates very nice margins for us. And obviously, it depends on a customer-by-customer basis, how much fiber we're using, what other components we're putting in to help with that solution. But I think the key is the fiber fortification trend is driving a solutions model where typically that business is stickier business and good margin business. So it's certainly helpful in that regard.

In terms of your question on price and price elasticity, we're clearly in a world where consumers are more challenged. Food is 20% to 30% more expensive than it was pre-pandemic because of all of the geopolitical challenges we've seen over the last 3 or 4 years. And there clearly is a requirement for some price stimulation to drive demand. But more importantly, for us, we're trying to balance the way we think about growing our business to make sure we're well-positioned for growth through the cycle. And in a cycle where demand is more muted, we want to make sure we're stimulating growth so that we're well positioned as markets start to grow.

[Operator Instructions] The next question is from Lisa De Neve from Morgan Stanley.

I have 2. First, can we talk a little bit about what you're seeing in APAC? Various players in this reporting season have noted an improvement in China specifically. And I believe your sequential local currency growth is modestly better in APAC. So any color on that would be great. That's one. And secondly, can you provide us a little bit of color on how your raw materials are trending into this year on average? How should we think about the direction for cost input inflation or deflation?

So maybe let me pick up the APAC question. Sarah can pick up the input cost one. Look, I mean, we're encouraged by the progress we're seeing in Asia. As you mentioned, we did see some improvement in China in the first half, and that continued through the third quarter. I mean it's difficult to talk about Asia as one region because it's such a vast area, but we're seeing good progress in China, solid demand in North Asia, across Japan and Korea. And that gives us some encouragement for the future. And if I look at APAC in the broader suite, we've grown that business significantly over the last 5 years. We're now a $500 million business revenue when we were around about $100 million 5 years ago. And it's a huge growth opportunity for us still because it's 60% of the world's population, and a lot of the trends we talked about on the call are true in Asia as well. So the opportunity there is very clear. And the fact that we're starting to see some stability and improvement is very encouraging as we go into the next 12 months.

Thanks, Nick. And then Lisa, on the raw materials, I think it's worth reminding you that we've now got a much broader array of raw materials, CPK, it's not just corn, [indiscernible], et cetera. And broadly, it's a more benign environment. There's not a strong inflationary push coming through there. So it's more benign, and we're well diversified.

I think it's fair to say we're seeing pretty flat year-on-year costs overall. I mean, with some ups and downs, but nothing significant.

We have a follow-up question from Joan Lim from BNP Paribas.

Sorry, just squeezing in one more question because everyone seems to be asking about margins. Nick, you've historically talked about how important it is to protect unit margins. Has this changed? Are you confident of maintaining unit margins this year?

No, I think the focus on unit margins hasn't changed at all. I think in the near term, we're trying to balance all the levers we have to get the business back into top-line growth. And doing that in an environment where markets are more sluggish means we're having to make some choices about where we invest and what choices you make. But fundamentally, over time, we expect to focus on maintaining unit margins and using mix to improve margins to the quality of the portfolio. We're in a cycle at the moment where we're having to make some choices.

It's reassuring to hear that you are confident of maintaining the margins.

With this, I'd like to hand the call back over to Nick Hampton for any closing remarks.

Thank you, operator, and thank you, everybody, for your questions. So just to summarize, trading in the third quarter was in line with our expectations and consistent with the first half. And importantly, our guidance for the full year remains unchanged. As we talked a lot about on the call, our #1 priority is returning the business to top-line growth. And we're clear on the actions we're going to take to improve top line performance of the business in the near term. We remain focused on top-line growth, execution, and delivering for our customers. So thank you for your time and questions, and I wish you all a very good day.

Thank you. This concludes today's conference call. Thank you for your participation, ladies and gentlemen. You may now disconnect.

Good morning, everyone, and thank you for joining us. Almost to the day, 12 months ago, we announced the completion of the acquisition of CP Kelco. And I'm delighted by the progress we made integrating the 2 businesses over the last year.

Today, we have 3 key messages for you. Firstly, we are stronger together. We've made good progress delivering the benefits of the combination. There's real excitement in the new team about the future potential of our business and the power of the combination is driving high levels of customer engagement. With our deeper product portfolio and leading reformulation capabilities, we have a compelling solutions offering, which meets growing consumer demand for healthier, more nutritious and sustainable food and drink. I saw this firsthand in Mexico 2 weeks ago, both in the new solutions our teams are creating for customers locally and in the kind of discussions we had with one of the leading dairy businesses in the country.

Our second key message is that a slowdown in market demand, notably in North America, is impacting our current performance. This is both disappointing and frustrating given the progress we're making elsewhere in the business.

Thirdly, as a result of this, we are taking decisive actions to drive top line growth, strong performance and position the business for an upturn in demand.

Let me start by looking at the first of those 3 key messages. Our expanded product portfolio and stronger technical capabilities are driving high levels of customer engagement. Over the last 6 months, we have had over 4,000 interactions with customers globally through a range of different channels across online meetings, innovation days, workshops and prototype tasting sessions. During these interactions, we've seen a significant increase in the number of customers engaged on technical issues. In fact, we've held technical discussions with over 250 more customers in the first half than this time last year. All these activities have helped to increase the value of our new business pipeline to $420 million. $175 million of new projects have been added to the pipeline in the last 6 months.

One of the main reasons for the high levels of customer engagement is the significantly expanded formulation and solutions offering of the combined business. In the last 6 months, with the inclusion of CP Kelco's portfolio, revenue from new products increased by 55% to GBP 166 million. New product revenue increased by 7% on a like-for-like basis with a particularly strong performance from the mouthfeel platform, which saw double-digit growth. So reflecting the strength of the combined portfolio and increased capabilities. The inclusion of CP Kelco's portfolio and the technical solutions of both businesses increased solutions-based revenue from new business wins to 39% on a like-for-like basis, increasing from 20% to 22%.

Investment in innovation and solution selling with the inclusion of CP Kelco's investment increased by 68% or 4% on a like-for-like basis. Innovation is the lifeblood of any business and the strength and quality of our pipeline is very encouraging. We said we would deliver targeted revenue synergies of 10% of CP Kelco's revenue or around $70 million by the end of the 2029 financial year, and we are tracking ahead of the plan. Cross-selling, which is the sale of CP Kelco's ingredients and solutions to Tate & Lyle customers and vice versa is a key part of how we're delivering these synergies. While it's still early days, we are making good progress.

The risk-adjusted value of our cross-selling pipeline stood at around $60 million at the end of the first half. This growth is broad-based with each region's cross-selling pipeline increasing by more than 85% in the second quarter. To support cross-selling across the business, we have rolled out global training programs for our commercial and technical teams. And we have also revised our sales incentive scheme to directly incentivize cross-selling. This is having a positive impact with some early customer successes, particularly for mouthfeel solutions.

Let me give you a few examples. In the U.S., an existing large customer wanted to improve the mouthfeel experience of its high-protein shakes. We would have struggled to deliver this in the past, but with the technical support of our new CP Kelco colleagues, we produced a solution based on gellan gum, which in the words of the customer, provided a mouthffit experience that no one else in the industry could offer. In Australia, another existing Tate & Lyle customer told us it was looking for better functionality when including dried fruit pieces in its granola bars. In response, we developed a pectin-based solution, which not only provided the desired functionality and mouthfeel our customer wanted, but also reduced cost.

Back in the U.S. and now looking at a CP Kelco customer, a well-known dairy manufacturer is now working with us on developing a wide range of solutions. The customer was initially only interested in formulation support for a high-protein yogurt dessert. But after having seen firsthand the breadth of our technical expertise across both businesses, more projects have entered the pipeline for products such as nutritional shakes, ice cream and dairy-based drinks.

Finally, to Spain, where we are developing a solution for a former CP Kelco customer to fiber fortify its range of gummies and make them sugar-free. We have only been able to do this because CP Kelco was a trusted supplier, and the customer can see the combined offering provides a much better offering for them than before. This gives me confidence that despite the current slowdown in market demand, the fundamental growth drivers of our business remain strong and continue to offer significant growth opportunities. These include societal trends such as population growth and the heightened awareness of the link between diet and health. Food industry trends also offer opportunities, whether for the reformulation of ultra-processed food to improve their nutritional content to the increasing demand for sugar and calorie reduction and fortification with fiber and protein.

The power of the combination also offers growth opportunities with its expanded customer offering, increased customer access and enlarged presence in the fast-growing markets of Asia, Middle East and Africa and Latin America.

In summary then, it's clear from what customers are telling us and from the growth in our pipeline, we have a highly compelling solutions offering. We are stronger together and our leading expertise in sweetening, mouthfeel and fortification means we are very well positioned to meet growing consumer demand for healthier, more nutritious and sustainable food and drink. While we are making strong progress setting the business up for future growth, in the near-term, we are operating in a challenging economic environment. And this brings me to our second key message for today, how a slowdown in market demand is impacting our current performance.

Before I hand over to Sarah to talk through the financial results, I want to look at the overall market context. In simple terms, in the Americas, volume was lower than we expected. In Europe, Middle East and Africa, we saw competitive pricing. And in Asia Pacific, we delivered good profit performance despite muted market demand. To put a bit more color on this, let's look at the U.S. market in a little more detail. After an extended period of weak consumer confidence, we came into the financial year expecting to see some improvements in market demand. As we outlined in our pre-close statement a month ago, this improvement has not materialized. Instead, we saw a slowdown in demand as the first half progressed, notably over the last 2 months.

On the screen are 2 charts showing Nielsen data for the U.S. food and beverage market in our key categories over the last 12 and 3 months, respectively. These show that in our largest market, volumes declined over the last 12 months and that in the last 3 months, this decline has accelerated as pricing increased. With consumer confidence remaining low, we expect the U.S. market to remain subdued in the near-term. I will come back later to talk about the actions we are taking to drive top line growth and improve performance.

But for now, I will hand over to Sarah to talk through the financial results. Sarah?

Thank you, Nick. Before I talk to the numbers, I would like to reiterate Nick's message of how we're already demonstrating the power of the combination. We are delivering cost synergies and productivity ahead of our commitment. Our new business pipeline has strengthened to $420 million, and we are taking decisive action to fuel our top line growth.

Now turning to the numbers. Please keep 3 things in mind. Firstly, I will focus on adjusted measures and items with percentage growth are in constant currency. Secondly, comparators are pro forma unless I indicate otherwise, as if the acquisition of CP Kelco had completed on 1 April 2024. Thirdly, given the ingredients in both the Tate & Lyle and CP Kelco portfolios are sold in volumes that differ greatly in value, in analyzing drivers of revenue change, we have combined the effects of volume and mix in line with industry best practice. More details are available in our disclosures. I will refer to this simply as volume.

So looking first at the financial highlights. On a statutory basis, including the impact of the acquisition of CP Kelco, revenue was 32% higher and EBITDA was 24% higher. On an adjusted basis, as Nick explained, a slowdown in market demand led to 3% lower revenue, and we delivered EBITDA of GBP 215 million, some 6% lower. Adjusted earnings per share were 21.3p. We delivered GBP 98 million of free cash flow with cash conversion of 71%, broadly in line with our long-term target. On a rolling 12-month basis, following the recent acquisition of CP Kelco, return on capital employed was 8.2%. This chart shows the main drivers of lower revenue. Softer market demand and tariffs impacted revenue by GBP 22 million. We invested GBP 10 million of revenue to the market through lower pricing, mainly in Europe. Overall, revenue was 3% lower in constant currency. While no longer a reporting segment, Sucralose performed well with revenue broadly in line with a strong comparative period.

I'd also like to highlight the revenue from the CP Kelco portfolio also continued to grow. Looking ahead, while the geopolitical environment remains uncertain, given the level of tariffs currently in force, we expect to see further impact in the second half due to the additional tariffs brought into effect late in August on imports from Brazil into the U.S.

Moving on to EBITDA, which is 6% lower. EBITDA decreased as a result of softer market demand, investment in price and the impact of tariffs, net of mitigation. This was offset by the positive impact of strong cost discipline, net of investments in growth and the early benefit of cost synergies. The recovery of CP Kelco portfolio continues, delivering margin improvement in the first half in addition to revenue growth. Our EBITDA margin at 21% remains attractive and well positioned compared to our specialty ingredient peers.

Turning now to the performance of our geographic segments. In the Americas, revenue was 2% lower and EBITDA 7% lower. While pricing was slightly higher, volume was lower as the slowdown in market demand led to customers ordering less than expected. In the U.S., revenue was broadly flat. We saw lower demand in each of our core categories, notably beverage and bakery and snacks. Market demand in Latin America was mixed with steady demand in Brazil, softer demand in Mexico. In Europe, Middle East and Africa, revenue decreased by 6% and EBITDA by 16%. Volume and pricing were both lower. We came into the year expecting lower pricing, reflecting our decision to invest some price back into the market in customer framework agreements for the 2025 calendar year.

Performance across our core categories have varied with higher demand in dairy and lower demand in soups, sauces and dressings and bakery and snacks. Asia Pacific delivered a robust performance with revenue in line despite tariff pressures and EBITDA was up 19%. Overall, demand was slightly stronger with good demand in China, especially in the beverage and bakery and snacks categories and in North Asia. However, this underlying demand was offset by the effect of tariffs across the region. We continue to work closely with our customers to meet their supply needs.

Turning to other lines on the income statement. On exceptional items, net pretax exceptional charges were GBP 17 million. This included GBP 20 million charge for integration costs, reflecting our strong cost synergy delivery and a GBP 10 million noncash charge from the buyout of the U.S. pension scheme as we continued to derisk our pension exposure. This was partially offset by a GBP 20 million provision release related to decommissioning costs at our former tapioca facility in Thailand. We sold this business in the half and as part of the sale agreement, these costs will no longer be incurred. The adjusted effective tax rate was 24.4%. As we stated in May, this increase is due to CP Kelco's operations being located in higher tax jurisdictions. We now expect the adjusted effective tax rate in the 2026 financial year to be in the range of 24% to 25%.

I'm pleased to report that the Board has declared an interim dividend of 6.6p per share, an increase of 0.2p per share. This is in line with our approach of paying interim dividends equivalent to 1/3 of the prior year's full year dividend.

Turning now to free cash flow for which comparatives are as we reported a year ago. Overall, adjusted free cash flow was GBP 98 million, GBP 29 million lower than a very strong comparative. EBITDA was GBP 27 million higher. Net working capital increased by GBP 37 million as we built higher inventory to mitigate the impact of tariffs on our supply chain and support customer supply continuity while we manage the optimization of capacity in our U.S. manufacturing facilities. Capital expenditure was GBP 5 million higher at GBP 55 million. For the 2026 financial year, we expect capital expenditure to be towards the lower end of the GBP 120 million to GBP 140 million range. Net interest increased by GBP 20 million, reflecting higher borrowings following the acquisition.

Our balance sheet remains strong. Long-term debt financing is in place at a competitive mix of fixed and floating interest rates and with a well-balanced range of maturities running out to 2037. We are targeting long-term leverage to be between 1x and 2.5x net debt to EBITDA, and our leverage stands at 2.3x currently. Net debt at end September was GBP 952 million. At the end of October, we entered a $180 million 2-year term loan facility and drew it down. These funds were used to repay an expiring $180 million U.S. private placement fixed rate note at its maturity. We continue to have strong liquidity with access to nearly GBP 1 billion through cash in hand and a committed and undrawn revolving cash facility -- credit facility. We are well positioned to continue to invest in the business.

I'll now hand back to Nick.

Thank you, Sarah. Moving now to our third key message for today, the actions we are taking to drive top line growth and stronger performance. These actions are focused on 4 priorities. The first is targeted investment to accelerate customer wins in key growth areas. Second is delivering the benefits of the CP Kelco combination. Third is to accelerate productivity across the enlarged group. And lastly, to continue to strengthen our balance sheet and deliver shareholder returns through clear capital allocation priorities. We are also making some organizational changes to support these priorities.

Let's start with the first priority. We are making a series of targeted investments to ensure we have the insights, capabilities, resources and tools we need to win with our customers in key categories and subcategories of growth. I'll cover these in a bit more detail. It starts with segmenting our new global customer base in a very granular way. As a new business with a significantly expanded portfolio and solutions offering, we want to ensure that we are targeting higher-growth subcategories and working with those customers who value our solutions and formulation expertise the most. This will help us prioritize the deployment of our commercial and technical resources and our investments in innovation. As I said earlier, we increased investments in innovation and solution selling by 4% on a like-for-like basis in the first half.

We will continue to invest to strengthen our customer-facing capabilities in the second half in areas such as applications, sensory, nutrition science and process development. This investment will be aligned with the work we are doing on customer segmentation to ensure we are building capabilities that directly support areas of growth. We are also accelerating the rollout of our solutions chassis program, initially focusing on mouthfeel. As a brief reminder, a formulation chassis is the base framework or foundational piece of technical knowledge within a given solution. Developed by a global team, chassis toolkits are then tailored by our regional teams to meet consumers' local tastes. As we explained at our Capital Markets Day in July, mouthfeel is critical to deliver a successful reformulation, and the combination has created a leadership position in mouthfeel for Tate & Lyle. We are seeing very strong interest from customers for mouthfeel solutions. And so we are ramping up our program. 10 new mouthfeel chassis have already been launched and a further 10 are in development.

Recent customer wins using mouthfeel chassis include a solution for a customer in the U.S. using a base of pectin and starch to create a high-protein yogurt and a solution for a customer in Europe for a low-fat no egg mayonnaise using a base of citrus fiber, Xanthan gum and starch, once again demonstrating the power of the combination.

With consumer trends changing all the time, it's more important than ever that we work collaboratively with our customers to develop the ingredient solutions they need. Our chassis approach for solutions allows us to meet our customer requirements faster and more efficiently. We are investing around $10 million in new technology and digital tools to support the effectiveness of our customer-facing teams. Part of this is a $3 million investment in building a new generative AI tool for our sales and technical teams. This tool will give our teams the ability to search our broad technical and scientific libraries to provide faster and deeper insights into how to solve customer formulation challenges. In short, when we are with a customer, we want this tool to eliminate the phrase, we'll get back to you so that we can always say, let me show you. This tool is currently being piloted with the rollout due to take place over the next 12 months.

We also continue to invest in ALFIE, our first of its kind automated laboratory for ingredient experimentation in Singapore. These investments include developing advanced AI predictive algorithms to help us better model customers' formulation requirements and develop line extensions more quickly. Customer collaboration on ALFIE continues to be strong. Our pipeline of projects is ahead of our business plan and the first customer product directly created by ALFIE has now been launched in China.

Moving now to the second action we are taking to drive top line growth, which is to continue to deliver the benefits of the CP Kelco combination. In addition to cross-selling, another key driver of revenue synergies is moving targeted CP Kelco customers to a direct service model. By way of a reminder, over half of CP Kelco's revenue currently comes from distribution partners. We have started the migration process and expect that around 10% of the revenue from CP Kelco's portfolio will have moved in-house by the end of the 2026 financial year. This will allow us direct access to these customers and significantly increase our ability to create growth opportunities with them. This process will also enable us to concentrate our remaining distribution business with our stronger partners and to migrate smaller accounts to them. We are seeing a positive response from customers to this approach.

I'm now going to hand back to Sarah to talk about cost synergies and our other 2 priority actions.

Thank you, Nick. I'm pleased to report that the CP Kelco integration continues to go well, reinforcing our confidence that we will deliver the cost and revenue synergies we have set out. On cost synergies, we have delivered $30 million in run rate savings as of 30 September 2025 and now expect to exceed our target of $50 million by the end of the 2027 financial year. As planned, our financial results will increasingly benefit from the realization of cost synergies in the second half.

Moving now to our third action, which is to increase productivity across the enlarged group. In addition to the delivery of cost synergies, I'm pleased to say that productivity once again showed significant progress. We delivered a further $21 million of productivity savings in the half with $40 million of this coming from operational and supply chain efficiencies and $7 million from procurement and cost management. To give you a sense of how deeply the culture of productivity is embedded across the whole organization, more than 150 procurement projects and over 180 continuous improvement projects across our manufacturing network were delivered to achieve these savings.

Our strong performance brings our total productivity savings over the last 2.5 years to $112 million. Given our strong productivity pipeline, we are increasing our 5-year target of $150 million savings by the end of 2028 financial year by a further $50 million to $200 million.

Turning to our fourth action to strengthen our balance sheet and shareholder returns. We continue to have a strong focus on cash generation. Our target is to deliver cash conversion greater than 75% each year while balancing with our priority to drive top line growth. We are targeting an improvement in the cash conversion cycle of the CP Kelco portfolio, which is naturally higher inventory, and we expect our operational expertise to deliver inventory reductions over time. In addition, we're also working to increase working capital efficiency across the combined business. Another area of focus is the disciplined investment of capital. We continue to bring rigor to the investment appraisal process of the combined business and expect new capital investments to meet attractive rates of return.

Moving on to capital allocation. We are committed to the disciplined deployment of capital and maintaining our financial strength. Consistent with our capital allocation policy, we will continue to invest in organic growth, selectively in acquisitions, joint ventures and partnerships, operate a progressive dividend policy and look to return any surplus capital to shareholders. Our current leverage of 2.3x sits within our long-term target range between 1x and 2.5x net debt to EBITDA. Looking ahead, for excess capital, the Board intends to continue to pursue the deleverage of the balance sheet and subject to prevailing market conditions, we will consider initiating a share buyback program when leverage is below 2x. The Board remains firmly committed to its progressive dividend policy.

And with that, I'll hand back to you, Nick.

Thank you, Sarah. To ensure we act with pace and agility, we are making some organizational changes to drive delivery of our priorities.

Firstly, I have appointed Didier Viala to lead our Americas region. Didier was previously the Chief Executive of CP Kelco and has over 30 years of food industry experience. His leadership abilities, fresh perspective and deep customer knowledge will be a great benefit to us as we focus on accelerating top line growth.

Secondly, we are combining platform solutions, marketing and commercial transformation into one team to drive commercial execution across the business. This team will be led by Melissa Law, our Chief Commercial and Transformation Officer, and will allow us to accelerate end-to-end deployment of new solutions and capabilities to customers.

Turning now to the outlook and summary. Our outlook for the year ending the 31st of March 2026 is unchanged from our pre-close statement on the 1st of October. In constant currency and compared to pro forma comparatives, we continue to expect revenue and EBITDA to decline by low single-digit percent compared to the prior year.

So to conclude, there is no getting away from the fact that it's been a difficult first 6 months of the year, and our performance is not where we want it to be. However, on the positive side, we are very pleased with the progress in delivering the benefits of the CP Kelco acquisition with both revenue and cost synergies ahead of plan. What's clear is that we are stronger together and have a highly engaged team. The power of the combination is driving high levels of customer engagement and our new business pipeline is growing strongly. This reinforces our confidence that the enlarged Tate & Lyle has a highly compelling customer offering and is well placed for growth. Given the challenging near-term economic environment, we are taking decisive action to deliver top line growth and improve our performance. We are investing to strengthen our customer-facing capabilities. We are simplifying our organization to focus on commercial execution. We're continuing to deliver the benefits of the CP Kelco combination, and we're accelerating productivity to invest further in our business.

As one Tate & Lyle team, we are excited about the future. With a portfolio repositioned to address growing consumer demand for healthier, more nutritious and sustainable food and drink, the long-term structural growth drivers of our business remain strong. Our opportunity is to turn high levels of customer engagement and the strength of our pipeline into top line growth and stronger financial performance. Everyone at Tate & Lyle is focused on making this happen, delivering on our action plan and the priorities we have set out today. The power of the combination is clear, and our focus is on execution, delivering for our customers and growth.

With that, Sarah and I will be happy to take your questions. We will take questions from both the floor and those joining remotely.

For the purposes of recording, please state your name and institution. Can we please have our first question from the floor?

I'm Joan from BNP Paribas Exane. So I have 3 questions, if I may. The first question is your new President of Americas. Can you share more about why Didier is the right person to lead Americas? And how can he help spearhead the recovery of this division? What went wrong in Americas? And how do you envision Tate outperforming end markets going forward? So this is my first question.

The second question is on your EBITDA guidance. With better-than-expected run rate cost synergies and higher cost savings from your productivity program, what is stopping you from raising your guidance? Why do you still expect it to decline in line with sales for the year?

And my last question is on Sucralose. So you said revenues were broadly in line with last year, which is surprising because it's already grown double digits last year, and we're expecting some phasing effects. Can you help us understand the market dynamics for Sucralose for this year, please?

Sure. So let me -- let's take those in order then. And Sarah, maybe you take the second question on EBITDA. Look, on Didier, I mean let me start with nothing has gone wrong in North America or in the Americas. We're experiencing a slowdown in market demand. But in North America, specifically, we saw flat revenues in the first half. However, a fresh perspective is always good. Didier with his vast experience of serving the food and beverage industry as the CEO of CP Kelco is deeply ingrained in our customer base and has a really strong understanding of the potential of the combined portfolio because of all of the work that we've done together. He's been leading our platform teams for the last 12 months, close to 12 months, and they're fueling growth as well. So we're taking his experience and putting it into a specific region to help accelerate growth. And we should remember as well, the Americas is still our biggest business. it's over 40% of our business.

So I'm really delighted that he's taking on this new challenge, and he's really excited about it as well because at the heart, Didier is a commercial guy. I mean, he's been doing this for a long time. So he'll bring real new energy and a fresh perspective, which is always good of what's a solid base as well. We've got a great business in the Americas.

Let me take the Sucralose question as well while we're on it. Look, Sucralose had a very solid first half, very consistent with the previous 3 or 4 years, very consistent delivery on both the top line and the bottom line. We're still seeing strong growth and demand for Sucralose globally. It's still the best nonnutritive sweetener out there, and there's a huge demand for sugar replacement. So we still got this franchise that's incredibly strong for us. and lots of customer demand for what we do, especially in the developed markets because of our unique sourcing out of North America. So we feel really good about Sucralose. It's a solid part of the portfolio and we'll continue to remain.

I'll let Sarah take the details on the EBITDA guidance. But let me put it into reference. We're assuming in our guidance that we're going to continue to see muted demand through the balance of the year. But despite that, we want to continue to invest in growth because ultimately, we're looking to grow the business now and for the longer-term, and therefore, reinvesting some of the savings we're seeing is really important. But I don't want to add a little bit to that.

Yes. Thanks, Nick. So I think indeed, I think it's put in context, so the first half is obviously minus 3% revenue, minus 6% EBITDA. So we've got to demonstrate improvement in the second half to deliver the low single digits. As Nick said, so we absolutely have demonstrated taking those costs out. but we're choosing to invest to ensure that we have the right competencies and capabilities in the organization to drive that top line, and we've talked about some of those activities today.

Fintan Ryan here from Goodbody. A few questions for me, please. Firstly, in terms of the soft end market demand that you're currently seeing, even though you're starting to develop a lot of cross-selling benefits seem to be growing. Could you just describe in terms of the -- is it a case that the core underlying end markets or business is performing worse than expected in the short run? I mean we're not seeing the benefits of the new cross-selling benefits come through? Or is it the case that the products are being launched on the market, but they're just not meeting the initial hopes and thresholds that maybe you would have envisaged?

And secondly, you pointed out quite strong performance in the Chinese market, particularly in the first half. So a lot of other food and beverage companies are talking about softness in that particular market. Can you describe what makes your business different? Is it your customer base? Is it your category mix? And could you foresee that continued strength in the Chinese market continuing into the second half and beyond?

So on your first question, it's simply a phasing question. So fundamentally underlying market demand, not where we had anticipated it would be. We're seeing real build in pipeline, cross-selling, et cetera. But those -- the benefits of the combination, especially on the top line, really only start to phase in from the next calendar year. So if you think about the distribution take back, you think about some of the cross-selling coming through, those naturally come through in the next year. So we're expecting to see those start to flow through in quarter 4 and into the next financial year. So the underlying base is where the softness is with those things coming in as we phase them. If you remember, we said when we announced the transaction, this was a kind of 3-year build, and it really started to build in the second year. So that's what we're seeing. The good news is we're seeing that demand come through in terms of the pipeline we're building.

In terms of China, I'd say a couple of things are different for us. The first is the CP Kelco business is on a recovery path, and China was especially soft part of the business where they saw the decline historically because dairy was suffered really badly through the sort of last couple of years. So we're seeing recovery there. And of course, we're also seeing the increased benefit of the 2 businesses starting to come through. So I would say China was robust. We saw some growth, but we're not getting too excited about it yet. We're still seeing relatively muted consumer confidence overall in China, but the CP Kelco recovery is part of it. And the way the business is doing a really good job of managing the tariff issues into China is helping too. And we should expect to see that in the second half, too.

Matthew, I said I'll come to you next. And Damian, I promise I'll come to you after that.

Matthew Webb from Investec. First one is probably one for you, Sarah. Could you just talk us through where we are on the working capital and inventory front? Obviously, you took inventory levels up in the first half. I just wonder whether that's done, whether there's more to come in the second half, at what point -- obviously, you talked longer-term about getting working capital levels down. Just sort of where we are on that cycle. That's the first question.

And the second one, which I suspect is quite closely related to it is I wonder if you could just update us on the tariff sort of implications, what you are doing both to deal with that yourselves and also to help your customers adjust to that new reality.

And then the third question, forgive me if you talked about this already, but I noted the comments about optimizing capacity in your U.S. manufacturing facilities. I wonder if you could just be very clear what that entails.

Yes.

So indeed, so there was a working capital drag in our free cash flow. It comes back to a #1 priority is having the right product in the right place for the customer. And with the ever-changing world of tariffs, it leads to an environment where we're not optimal working capital, we're very much focusing on the right product in the right place for the customer. There's also an element and it comes to your third point about as we optimize our manufacturing facilities in the U.S., and that particularly relates to biogums, we have to build a bit of inventory as we revalidate product with customers, as we continue to ensure we have that optimized footprint in the U.S. with respect to biogums. I think absolutely, this is going to take some time to unwind. So it will not be a tailwind in H2. But absolutely, over the months, it's that continuing focus. And it comes back to how are we delivering what's under our control. And clearly, working capital is one of those elements. So absolutely, over time, we continue to optimize our working capital.

So on tariffs, it's sort of tired saying it's a moving piece because everybody knows that already. But it's having an impact on the business in a number of ways. The first is, as Sarah has pointed about, we're prioritizing putting inventory where we need to for customers and building inventory in anticipation of tariffs moving around. And we're still seeing a little bit of a moving piece, especially with the U.S.-China issue. It's therefore impacting our ability to serve customers effectively, clearly, and we're prioritizing that. We're passing through tariffs where we can. And we're also moving production around the world to avoid tariffs where possible. So for example, recently for us, shipping pectin or hydrocolloids out of Brazil into the U.S. has become more of a challenge. So we're shifting production into Europe and managing the network in a different way. So the team is doing a really nice way, nice job of managing that effectively. And it hasn't had a disproportionate impact on the business. But operationally, it's a challenge that a lot of businesses are dealing with.

I'd say the bigger question actually is the second order effect of tariffs and the impact it's having on consumer demand. That's what we're seeing in the U.S. If you -- the Nielsen chart I showed you earlier, that pricing that came through in the second quarter is a reflection of tariff pass-through. And that's -- so the consumer confidence around the world is being impacted by it because of pricing. But all of those things are factored into how we're managing the business. And like every other business, we're dealing with it in a sort of agile way and as best we can. In terms of the footprint rationalization in the U.S., I think Sarah has broadly covered that. One of the benefits of the transaction was a significant investment in lower-cost biogums manufacturing in North America. That's allowing us to move production around and rationalize facilities in a way that would take cost out. So it is part of the productivity drive in the business. And that capital has already been invested as well, which is a good thing.

If you remember, we talked about the $200 million of investment that was made. We're now in the middle of executing that transfer. The transfer takes a little bit of time because of moving customers onto a new facility and a slightly different production platform.

David, I promise I'll come to you next, and then we'll go...

Damian McNeela from Deutsche Numis. I think first one for you, Nick, is I appreciate you've given us some information about U.S. FMCG markets and volumes down sort of broadly 2%. But if we look at some of your peers, they've delivered positive volume performances in that region. I was just wondering, how do you think about Tate's market share evolution over the last 6 months? And where do you -- is it sort of a category issue for Tate? Or is it the fact that it's very difficult to compare apples with apples in this environment is the first one.

And then secondly, Sarah, for you, APAC profitability was up like nearly 20% on flat revenues. Can you talk about what drove that improvement in profitability? Is that country mix driving that, please?

So let me take the first question, obviously. It's very difficult to measure share precisely, and it goes up and down. And when we look at our North American business in the first half, volume down a little bit, pricing up a bit of a bit, revenue flat. So actually, in terms of volume weighted ahead of the categories that we're seeing. Now what does that mean in terms of share, difficult to say. I wouldn't say we're performing particularly differently to anybody else because there are category mix issues, there are comparability issues. But what I'm concerned about now is accelerating top line growth. And to do that in the near-term, we'll have to make sure we're targeting growth areas within our categories and look to take share as reformulation kicks in. Sarah.

Thanks, Nick. And David, on the APAC. So it's great to see APAC performance resilient despite all the noise about tariffs. Recall, CP Kelco is a really important part of APAC. And as they have improved, that's really supported the improvement of EBITDA. In addition, there's good old-fashioned cost control supporting that broader agreement to the region.

I think, I think it's a good example of controlling all the things that we can control in the context of the environment that we're in. And the Asia team has done a really nice job when you add on the complexes of tariffs in their business. I'm conscious that we've got people very patiently waiting online as well. So I think I'm going to take an online question next, and then I'll come back to the room. So Carol from Kepler, over to you.

I have a question on supply-demand in the North American market because it's been -- the market has been difficult for a period of time now, and we're heading into the negotiation season, of course. So how you're seeing supply demand in the North American market, I guess, particularly on the new sweeteners platform.

And the other question is in a slightly different way, it's been asked before, but we noticed quite sizable gaps in the performance of ingredients players also in North America, depending on the end markets they serve or have a strong foothold in. If you look to your -- to the wins and new customer engagement, is there a big program to where you see we see us becoming more successful making inroads in higher growth segments? Can you single out a couple of things that look promising at this point?

Sure. So in general, with muted demand for the last couple of years, the supply-demand balance is clearly shifting a little bit. And we sort of were conscious of that as we go into the season for renewal of framework agreements with customers. But the thing I'd say is part of the repositioning of the business is about creating levers that go beyond that. And if you think about the growing pipeline, the broader portfolio we have, it gives us many more levers to play as we go into that into that season. So very, very early in the whole process of renewing customer agreements for next year. So we'll give you an update on that in the new year. But we are bringing different levers this time around to the past as we brought the 2 businesses together. And we've got the distribution takeback and the direct selling from that to benefit from. We've got the pipeline. So there are lots of other things we're thinking about driving. And what we've seen so far in North America is relatively stable pricing. In the first half, we saw price slightly ahead of volume.

In terms of what does that mean in terms of focusing on growth, it's all about going after those priority growth subcategories. So it's about low sugar relating to the sweetener business as you talked about earlier. I mean, clearly, we've got a unique sweetening portfolio. So we've got the only North American or American supply chain for stevia. We've clearly got our North American Sucralose business benefiting us as well. So it's about targeting subcategories where we're seeing low sugar combined with mouthfeel because when you take sugar out, you need to replace the mouthfeel to provide customers with products that really work for consumers. And those are the kind of things we're working on in terms of building a pipeline of future growth. And as we start to see innovation pick up, we'd expect to see those things flow through into new business for us. So Vincent, I'll come back to you.

Artem from Rothschild Redburn. I've got one on Solutions. Encouraging to see the number of your solutions sales as part of your new business wins, 39% compared to 22% like-for-like. Just maybe help us understand this number a little bit. So like obviously, it looks like a big jump in the number. If it's like-for-like, does that mean it's still Tate plus CP Kelco? Does that exclude synergies before? So is it a function of synergies kicking in and you see the progress of more solution sales? Otherwise, is it just a function of you being able to do more with the CP Kelco business, your portfolio broadens, you can offer more solutions. So could you talk a little bit about this number because that's obviously very encouraging to see such growth?

Yes. So like you, we're very encouraged with the growth in our new product revenue and in the pipeline of solution wins. The like-for-like really means that we're measuring the combined business in both years. So we're taking the combined portfolio last year and measuring it against the combined portfolio this year, which I think is a fairest measure in terms of seeing progress. Clearly, there's been a big increase in the overall total and spend because when you bring an extra business in, you naturally get a big bump. But think of it as a comparable. So the 7% on new product revenue, for example, is a really good example of that. And why is it growing? Because our new products have real relevance for the future of where food is going and because the combination coming together allows us to do things that we couldn't do when we were a part. So if you think about the examples I showed you from the U.S. to Australia to Spain, they were all a combination of the 2 portfolios coming together. 12 months ago, we couldn't do that. So hopefully that answers that question.

Lisa De Neve, Morgan Stanley. I have 3 questions. One is a follow-up from Artem's question. I mean you've done very strong on solution-driven sales. Can you just put a bit of context on how that's going to drive your mix and your delta margin progress over the coming 12 months? That's my first question.

The second question is on price. You've talked about making price investment in the first half. Can you just detail a little bit where you've invested in price and how we should think about this to trend in the second half of the year, especially in ongoing deflationary context for raw materials?

And the last question is on special returns. you've highlighted you would consider a buyback when net leverage drops below 2x. Can you share if that's the main driver driving that potential decision for a buyback or whether you will take other variables in consideration as well, such as market backdrop or your level of your share price?

Sarah, do you want to take the margin point?

Price point.

Yes, then I'll come back on the...

Go first. Okay. So yes, thanks for the question. So I think it's really important to think about region by region. So we've talked a lot about what's going on in the Americas, but I think it's worth highlighting in Europe, for example, we've -- the price has been under a lot of pressure. So we have invested in price there. We knew that was going to happen going into this calendar year, and that's one of the main contributors to the slightly muted results in Europe. So I think it's really important that region by region, there are different dynamics and that depends on the supply chain, what else is going on. But indeed, the significant price pressure has -- we've seen it in Europe.

So on solution selling then and the sort of pipeline, I mean, clearly, our experience from history and all of the pipeline conversion we've seen over the last 3 or 4 years is that the conversion of that pipeline is margin positive. So it should help as we go into quarter 4 and into the following financial year. And that will be weighed off against all the other factors we're driving in terms of managing the mix in the business. So it's a positive benefit for us as we go forward. How much flows in and when it flows in, of course, will be determined by the rate of pipeline conversion.

Coming back to your question about shareholder returns and share buybacks and how you might do that. Look, I think the signal today is that we're very conscious about balancing off investing in the business for growth and delivering returns to shareholders as our balance sheet allows us that flexibility. When we get to a point in time where we have that decision to make, the Board will use lots of different factors to determine what the right answer is for both shareholders and the business. And it's a bit difficult to give you a template for that. It's not prescriptive because it will be situational. There'll be the market circumstance, there will be the share price, there will be investments in the business. There'll be what the growth potential of the business looks like in the near-term. All of those things will come into play. But I think the point we're trying to make today is we're going to be very flexible and open-minded about that, conscious of the fact that we want to maximize shareholder returns in the current environment.

So I'm going to go back to the screen now, and I see that Alex Sloane from Barclays has a question. So Alex, over to you.

The first one, just in terms of the CP Kelco business, I think you're bringing back a lot of that distributors in quarter 4. I wonder if you could speak to how you're managing any risk of potential air pockets as distributors try to phase out stock. Is that something you're seeing at all in quarter 3? And is that embedded in your second half guidance? That's the first one.

And the second one, I mean, over the summer, a former FDA commissioner filed a citizens petition with the FDA seeking to revoke GRAS status for our host of corn-derived ingredients [ he argues ] contribute to negative health outcomes. How material is that development on your sort of overall radar screen of risks?

Do you want to take the first question?

Very happy to. So I think -- so absolutely, so take back from distributor is a key part of the transformation case with CP Kelco. We are working well with our distributors and trying to find the win-win -- so how do we consolidate our relationship with distributors. And of course, distribution will be a key part going forward. I think -- and with those larger distributors, the conversation is if we take back this geography, but we could give you another geography to support their growth as well. You talk about air pockets. I think absolutely we got acknowledged that in Q3, as we start some of those distributors, we do start taking house. That does have an impact as obviously, they work through their inventory. But absolutely, that's built in the guidance for the full year.

And Alex, I'd just add one other thing to that, which is as we work with our distributors on that program, we're focused, #1, on maintaining customer service; and #2, on working with them to balance off the business to give them incentive to grow with us going forward as well because they're always going to be an important part of our business to a certain extent in certain markets.

On your question on the Kessler petition to the FDA, I mean, not unusual. We've seen things like this in the past. They tend to take time to work through. And when we look about -- look at our broad portfolio, a number of our products in the portfolio already have alternative accreditation anyway, so it wouldn't be impacted by it. And that's where the sort of breadth of the portfolio really helps as well because to the extent that there will be any substitution, we'd have other products that we could move into the mix. Obviously, we're following regulation in the U.S. very carefully, as you'd expect, but we don't anticipate it having a material impact on the portfolio.

Okay. Any other questions? No? Yes. Patrick, sorry, I missed you on the screen. Patrick Higgins from Goodbody.

I just wanted to come back to the solution selling for a minute. And forgive me if I missed this, but do you know how much of the combined sales today are sold via solution? And I appreciate it might be too early to guide on this, but where do you think that could get in the medium term? And obviously, through today's presentation, you've kind of highlighted the benefits of the combination and the power of the combination and how CPK will enable that increased solution selling. But where do you see the biggest gaps in the rest of your kind of offering to enable that kind of progression in terms of solution selling? Is it application? Is it consumer insights? Just a bit of color on that would be really helpful.

I mean great question. I actually can't give you a specific answer to how much of it is combined in terms of the solutions bit of it. What I do know is the pipeline is growing very strongly and a lot of examples I've given you in terms of recent success have included the combined portfolio. But I actually think the more important measure is the total strength of the pipeline. Because actually, if you think about the example in Spain, where we're working with the customer on a broad-based set of solutions now, it's because of the combination. And it might only be one part of the portfolio that goes into a particular solution, but it's the fact that we can cross-formulate that gives the access and the confidence that we're the best partner for that. How far that goes, we'll see. I mean we clearly want to continue to grow it because it has a positive impact on the business.

In terms of gaps, I don't think the gaps in the portfolio are about the latent ammunition, if you like, the ingredients themselves. I mean, will we like to have a little bit more exposure to protein maybe. I think the gap is actually more about building increased consumer understanding of where we can grow best, so really understanding our customers' needs and where they see the big opportunities and then continuing to learn internally about the power of the combination as our application scientists come together and formulate in a way across the portfolio that we couldn't do before. And that's about time and learning. I mean, over time, that will strengthen. And it will be augmented by things like ALFIE, where we've got this rapid prototyping capability. So we can actually accelerate our own understanding and therefore, accelerate our ability to delight our customers with solutions they didn't think were possible before.

So it's now really about execution of what we have and executing it in a way that we're executing against the biggest growth opportunities externally, either customer-specific, category specific, and in some cases, through region-by-region differences.

Okay. So if there are no more questions, I can't see any hands up in the room or names on the screen. I'll finish with a couple of brief remarks, if you like. Look, as we said, in the first 6 months of the year, our performance is not where we want it to be. But we're incredibly encouraged by the strength of customer engagement and the strength of our pipeline. And that gives me confidence that we're moving in the right direction. So our near-term focus is absolutely on the priorities we just laid out for growth. And it's all about execution, growing with our customers and really helping them grow in a more difficult world.

So thank you for joining us today, and we'll no doubt see you in the new year when we give you an update then.

Good morning, and welcome to the conference call for Tate & Lyle's First Half Pre-closing Statement. Today's call is hosted by Nick Hampton, Chief Executive Officer; and Sarah Kuijlaars, Chief Financial Officer. I will now hand over to Nick Hampton.

Thank you, operator, and good morning, everyone. Welcome to the conference call. I will make some introductory comments, and then Sarah and I will be happy to take your questions. First, I want to look at the bigger picture. We continue to make very good progress delivering the benefits of the CP Kelco combination. Customers are increasingly recognizing the strength of our combined portfolio, especially our expertise in mouthfeel. And this has led to a very encouraging early cross-selling successes with the value of the pipeline more than doubling in the last 2 months alone. The strong interest our combined offering and reformulation expertise is generating with customers clearly demonstrates the strategic logic of bringing Tate & Lyle and CP Kelco together, and reinforces our confidence in the growth potential of the combined business.

While the level of customer engagement is high, we are operating in a tough market and have seen a slowdown in demand as the first half progressed, particularly over the last 2 months, which in turn has slowed our recent performance. We are seeing different dynamics across each region. In the Americas, we expect revenue in the first half to be slightly lower, reflecting softer consumer demand, notably in North America, still have largest market.

In Europe, Middle East and Africa, revenue is expected to be mid-single-digit lower despite slightly higher demand. In Asia Pacific, revenue is expected to be broadly in line after absorbing the impact of tariffs, which we continue to navigate well. Against this more challenging backdrop, we are accelerating a series of steps to drive delivery of top-line growth. These include investing in enhanced customer segmentation, further strengthening our customer-facing capabilities such as solution selling, applications and marketing, working even more closely with customers to accelerate innovation through technology and optimizing capacity in our manufacturing network to accelerate productivity.

The margin of the CP Kelco portfolio is expected to improve further in the first half. Planned revenue and cost synergies, and delivery of savings from our productivity programme remain on track and demand for sucralose continues to be strong. Overall then, for the first half in constant currency and compared to the pro forma comparatives, we now expect Group revenue to be 3% to 4% lower. Reflecting this top-line softness, the investments we continue to make for growth, and the planned weighting of cost synergies into the second half, EBITDA in the first half is now expected to be high single-digit percent lower.

We will provide a more detailed update on the business and the actions we are taking when we announced our half year results on the 6th of November 2025. Turning to the full year outlook. While we anticipate the near-term market demand environment will remain challenging, we expect performance to improve as we move into the fourth quarter. This will be driven by the acceleration of actions we are taking to drive delivery of top-line growth and increasing benefits from the CP Kelco combination, including an acceleration in cross-selling, the migration of distribution relationships to a direct service customer model, and delivery of cost synergies.

Therefore, for the year ending 31st of March 2026, in constant currency and compared to pro forma comparatives, we now expect revenue and EBITDA to decline by low single-digit percent compared to the prior year.

In summary then, in April, we started to operate as one combined business. Since then, we have made real progress setting up the business for future growth, while also operating in a period of considerable economic volatility. The benefits of the combination appear to see. Looking ahead, the fundamental growth drivers of our business remain strong. Consumer demand for healthier and more nutritious food and drink continues to grow. And our expertise in food and drink reformulation and our leading positions across sweetening, mouthfeel and fortification, mean we are well-positioned to capture this growth.

To conclude, we are determined to accelerate top-line growth and are fully focused on successfully delivering the benefits of the CP Kelco combination. With that, I will open up the call for questions.

[Operator Instructions] We will now take our first question from Matthew Webb from Investec.

I wonder if I could start off by just asking about the split of the revenue decline, both in H1 and expected for the full year between volume and pricing. And I suppose I'm particularly interested in the extent to which the weakness in volume demand has had the knock-on effect on pricing and what sort of the competitor behavior has been as well as a result of that weakness? That's my first question.

Obviously, overall we're seeing a lack of consumer confidence in sluggish markets and the dynamics across regions are somewhat different. So in North America, we're seeing pretty broad-based category softness fueled by inflation and tariffs, I think. But we're seeing relatively balanced pricing environment, but broadly in line, slightly positive. In Europe, as we said when we did our full year results, we consciously invested some price in driving volume momentum. So in Europe, we're actually seeing a slight volume momentum, but some pricing decline. And in Asia, we're seeing relatively muted demand with some pricing pressure, especially driven by softness in China.

And then I wonder if you could perhaps try and separate out the impact that tariffs have had here on the reduced guidance. Is that a big factor? And I suppose there, I mean even more about the direct impact of tariffs on you rather than the sort of broader impact of tariffs on consumer demand?

You're asking the right question, of course, because the second order impact on consumer confidence is difficult to measure but clearly, we're seeing that, especially in North America. And overall, the team is navigating the tariff situation well, given that it's still bumping around a bit, it's relatively uncertain, and we're focused on customer supply security, recovery of tariffs where possible and alternative supply routes. So if you look at it around the world, we said at the full year that it routed about 2% of our revenue shipped into China was being impacted. There's a little bit going the other way. The other thing that's happened is the significant imposition of tariffs on Brazil and [indiscernible] out of Brazil into North America. So we think -- and again, it's very difficult to be precise when you look at supply routes, probably 3% to 5% of our revenue pre -- any mitigation is being impacted by tariffs because of the flow of goods. As I said, we're mitigating that in various ways. So I would think about it in that kind of...

And then sorry, final question. I mean clearly, the deterioration in the market environment, as you said, has been a relatively recent thing at least has become worse of late. And I wonder, therefore, how much sort of confidence and visibility you've got in the ability to improve your performance in Q4. It just sort of feels like you're slightly swimming against the tide there. How confident can you be that we will see that improvement?

So we're not assuming any near-term improvement in the market environment until we see that, and we shouldn't be building that into our assumptions. However, what we are clearly going to see in Q4 is the benefits of the combination starting to flow through. So if you remember, we always said the cross-selling benefits, the distribution to direct benefits would only start to flow towards the end of the year and we have very clear line of sight to those. And we're also seeing the pipeline building on our solution selling portfolio because of the benefits of bringing the 2 portfolios together. So we're really assuming any improvement in quarter 4 is coming from the benefits of combination flowing through more fully and the actions we're taking to accelerate growth regardless of the environment we're operating within.

We'll now take our next question from Patrick Higgins from Goodbody.

A couple of questions, if I may. Firstly, just in terms of, I guess, that innovation pipeline, and you touched on it there, Mark, but Nick, sorry, but maybe you could just elaborate one of the things we've heard from a lot of customers of yours or peers is the pipeline and the demand from an innovation perspective, particularly in the U.S. as reformulation really starts to kick in, has never been stronger, so I'd be interested to hear your comments on that. And secondly, look, apologies, I didn't hear all of your prepared remarks, but on sucralose, could you maybe just give us a comment in terms of how that business is trending and how much of the softness you've called out today is related to that business?

So let me take your second question first on sucralose. We're still seeing very strong demand for sucralose, this is what we do. We talked about this a number of times and let me put simply, we're pretty much selling everything we can make. And while there's been some noise on sucralose in the market recently, we're seeing very strong robust demand and continue to see that, so that's pretty clear. On your first point, yes, we are seeing strengthening of the pipeline. And a lot of that is to do with the benefits of bringing the combination together as well.

I think the question we're still asking ourselves internally is how fast that pipeline converts in an uncertain consumer environment because what we're seeing at the moment is a lot of relative pricing in the market versus innovation, so the question we can't answer yet is the pace of conversion of that pipeline. The win -- success rate is very good actually in the pipeline when we look at that. When those products come to market, it is still less certain, I would say.

We'll now move to our next question from Joan Lim from BNP Paribas Exane.

A couple of questions from me, please. So you mentioned you are taking a series of actions with customers. I was wondering if you could help providing more color as to how the conversations look like, what else you're doing with the customers? So that's my first question. And second question was the categories. In terms of categories, I know you said broad-based softness in North America, but I wondered if there were any like beverages or specific categories you could call out in terms of latest color on market trading?

So let me take the second question first. We're actually seeing pretty consistent softness across our key categories currently. I wouldn't call any out specifically at a sort of macro category level. Clearly, when you go double click one level below into subcategories, we're seeing more slightly healthier demand for the better-for-you type part of the portfolio. But overall, net-net, there isn't a significant difference across the core categories that we always talk about serving and we're obviously continuing to track that closely as we go forward.

In terms of what we're doing, the benefits of the portfolio clearly allow us to think differently about how we serve our customers. And a big part of that is, frankly, working through which customers we want to double down our efforts on and where do we see the most growth and how do we deploy our resources with the right ammunition to accelerate growth with the customers where we see most opportunity. So we're doing a lot of work on segmenting our customers both globally and locally to deploy our resources as effectively as possible. And at the same time, making sure that based upon what we're seeing in terms of consumer demand and consumer trends, we're building the ammunition and the solutions focused on those areas of consumer opportunity. And we'll talk more about that when we do our half year results in November.

Sorry, can I just follow up on that? So you mentioned customers locally and globally. Are you seeing a difference between the local and regional customers and the bigger customers?

Always when you come across the world, you see different behaviors. I wouldn't call out a specific trend that's global versus regional. It's just more importantly for us, it's about making sure in each region, we're working with the right customers because of how they're building their businesses locally. And that can vary global customers versus regional.

Because I think the global customers have been losing share to the local and regional, who might be growing faster. So I wonder if there were any...

Why it's important that we build a balanced focus across all customer types to make sure we're focusing on where we see most growth potential.

And then on your broad-based category softness, was it just in North America? Or was it across regions?

Specifically referencing to North America in the more recent months, I mean we are seeing varying cash flow dynamics across the world. In Latin America, we're seeing stability in Brazil, some softness in Mexico. Across Asia, we're seeing relatively muted demand, but there are opportunities in places like health and wellness. In Europe, we're seeing relatively stable demand with opportunities in categories like dairy and clean-label, so the point I made earlier in some way about customer segmentation, you have to look at it region by region and get on the surface where the key trends are.

We'll now take our next question from Alex Sloane from Barclays.

Two for me. One is a follow-up in terms of the assumptions in the second half. So it sounds like you're not assuming much in the way of improvement inflection in underlying market conditions from a sort of a volume perspective. What are you assuming in terms of the pricing round? So obviously, I guess, kind of weaker demand probably doesn't bode that well there. So have you been conservative in your assumptions there? And I guess sort of the overarching question there is how confident can we be that this is kind of one and done? Or is there more risk to the revised full year guidance?

And then second question, I think in your prepared remarks, you talked about CP Kelco margins moving higher in the first half despite obviously the fact that kind of the group profits are going to be down high single digits. So is it fair to assume that sort of more of this pressure is being felt in the legacy-tight FBS business than CP Kelco?

So on your first question, Alex, obviously, we're very early in the framework agreements we're building for next year with customers and that process will continue through the next few months. We've been relatively conservative in our assumptions for the contracting round at this point in the year. And as always, we'll give you more color on that as the round evolves. On the CP Kelco margin point, we are seeing improvements at the gross margin level. You have to remember, of course, that we're not measuring profit margins separately across the 2 businesses at the moment because they're integrated. So to some extent, some of the investments we're making in the business sit below the gross margin level. But it would be fair to say that we have seen some pressure on the legacy-tight Lyle business, especially because of the pricing which has put back into the market in the last round.

And maybe just if I could squeeze in one more. Just in terms of the Brazil tariff situation, obviously kind of relatively lower I think those kicked in, in August. Could you give a bit more color in terms of how you're mitigating that and what impact that had -- I guess what impact you're assuming that has for the full year?

So roughly about 1% of our revenue is shipped out of Brazil into North America. We are shifting supply routes to source more out of Europe because we've got [indiscernible] manufacturing in Brazil and in Europe. And obviously, where possible, we're passing tariffs through. So we've assumed a rebalancing between Brazil and Europe and an appropriate level of cost associated with the tariff shipping into the U.S. that's built into the overall assumptions we've given you today. Sarah, do you want to add anything to that?

No, I think that's absolutely. I think [indiscernible] maybe linked to that, as we navigate through tariffs, obviously, we are really focusing on having the right products for the customer in the right place which impacts our supply chain. And I think that leads to an inventory level which is not yet optimal. And that will come later. But obviously, it's that -- the prime focus is the right products in the right place for our customers.

And sorry, just one more. Obviously, you've done well over the last few years in terms of driving productivity savings. If the outlook actually does deteriorate further, is there more you can look at on this front?

Absolutely, we will continue to drive productivity hard. As you say, we've got a very successful track record and overall, the program that we announced a couple of years ago is running ahead of target, so we'll continue to double down our efforts on that. And of course, as we learn more about the potential of the combined business, we'll -- I'm sure [indiscernible] more opportunities that will help with fueling the business.

We will now take our next question from Damian McNeela from Deutsche Numis.

A few for me, please. Firstly, just on the sort of the demand outlook, I think in North America, you're ascribing the slowdown to broadly economic factors. I was just wondering to what extent do you think GLP and consumers just eating less is impacting this? And how we should think about that when we think about our medium-term expectations in that business is the first question?

Second question is on sucralose. Now I hear what you said around the sort of current trading of sucralose. But what do you think the risks are around changing regulatory sentiment towards high-intensity sweeteners and how sucralose positioned to deal with that? And then I guess the final question is perhaps for you, Sarah. Given the sort of downgrades we're sort of looking at today and the sort of increased talk about destocking across the sector, how should we think about cash generation for the full year?

So on the demand outlook, I would say I mean the facts that we're seeing are significant consumer inflation in price in North America. So if you look at the retail sales data, while volume is down, value is up quite significantly. And that's always a big driver of relative demand. On GLP-1, no doubt it's changing the way people eat. And as we talked about in our capital markets event a couple of months ago, we see that as an opportunity for reformulation over time because of the need to provide more nutritionally balanced and dense food for those on GLP-1 and then to provide healthy alternatives when they come off the drug. So we're looking at through the lens of opportunity. And obviously, we'll see how that plays out. When I look at the data, it looks like the price inflation is driving a significant piece of the volume softness in the near term.

And on your question on sucralose, there's been a continual [indiscernible] pressure on high-intensity sweeteners for a number of years. And we continue to see the demand for sucralose especially to be very robust and growing across the world. And that's a trend we've seen for the last 10 years. So we're very confident about the outlook for our sucralose business, especially as we are very focused on customers who really value what we do and we are capacity constrained at this point.

However, whether a decrease in demand for high-intensity sweeteners, that's the power of the portfolio because we have other sweetening solutions in the business that can replace high-intensity sweeteners and provide the same kind of impact, albeit that there's often a cost trade-off there. So if you take a high-intensity sweetener out, you've got to put something else in and natural sweetener solutions like stevia can really play against that trend should that happen. So I think the portfolio balance here is really important and the way we position that sucralose business is really important when you think about the future.

And then Damian, on cash, of course, we continue to focus on cash and continue to focusing on target cash conversion of 75% and the reduction of our leverage. However, as per one of the earlier answers, we've got to acknowledge that the working capital is going to take a bit of time to be optimized because given the volatility in the tariff environment, that doesn't help optimizing our inventory position at the moment; absolutely, we're focusing on getting inventory in the right places to support the customers. And obviously, we'll talk more about where cash lands on November 6 for our H1 results.

[Operator Instructions] We'll now move to our next question from Lisa De Neve from Morgan Stanley.

I have 2 questions, and one is a bit of a follow-up on the demand comments you've made. So can I just ask you to which extent -- I mean, CPGs are being here much more cautious in their purchases and are either mimicking the underlying market? Or are they actually being a lot more cautious than perhaps the softness we're seeing in the market? I'm just trying to understand and disentangle what's driving this demand weakness?

Because my understanding is that the North American market and global food and beverage market is trending broadly flattish with CPGs, the big ones being down. And I'm just trying to understand, is it just CPGs being even more cautious on their purchases and managing their inventories? Is it specific ingredients that -- where you see softer demand? I mean it would be great to get a little bit more granularity on this. And then secondly is a bit of a follow-up on the free cash flow question. In the light of the sort of softer year for you, and it's very much across the sector, but just talking about you, I mean, how committed are you to the dividend?

So on your point on CPG and overall demand, we've clearly seen a decline in volumes in North American retail in the last quarter. So that's a clear trend we're seeing. Whether that's then impacting customers' inventory levels and how they think about that is a bit early to tell. But we're certainly seeing a reduction in demand in the near term. As you rightly correct, more broadly across the [indiscernible], things are relatively more stable, not growth but stable. Now that's a gross generalization because you have to look market by market. But the thing we've really seen in the recent couple of months or so is a notable slowdown in North America.

On your question on the dividend, the Board has a very clear capital allocation structure framework and has been committed to a progressive dividend for the last 10 to 15 years. So we're absolutely committed to the dividend, and the Board will continue to appraise the capital allocation framework as normal as we go forward.

It appears there are currently no further questions today. So with this, I'd like to hand the call back over to Nick Hampton for any additional or closing remarks. Over to you, sir.

Thank you, operator, and thank you for your questions. So in summary, we continue to make good progress delivering the benefits of the CP Kelco combination. Customers are increasingly recognizing the strength of our combined portfolio and the cross-selling pipeline has more than doubled in value over the last 2 months. A slowdown in market demand has impacted our recent performance, and we are accelerating actions to drive a top-line growth.

Looking ahead, the fundamental growth drivers of our business remain strong. Consumer demand for healthier and more nutritious food and drink continues to grow, and our expertise in food and drink reformulation mean we are well positioned to capture this growth. We are determined to accelerate top-line growth and are fully focused on successfully delivering the benefits of the combination. Thanks for your time and questions, and I wish you all a very good day.

Thank you. This concludes today's conference call. Thank you for your participation, ladies and gentlemen. You may now disconnect.

Good afternoon, everybody, and welcome to the first day of Tate & Lyle's Capital Markets events. It's, of course, lovely to see so many familiar faces in the room but also to those of you online, thank you for joining us. Sorry, you couldn't be with us here today. At least you won't be able to feel the temperature in the room, which we will, no doubt, find more challenging a bit later. Look, thank you for spending time with us today to learn more about the transformed Tate & Lyle. I hope you enjoy the session and then the session we're going to have in Denmark for those who are coming over in a couple of days' time.

It's actually almost to a day a year ago, that we announced the combination with CP Kelco. Last month, our leadership team got together to reflect on the incredible progress we've made in that last year and really in 6 months since we actually closed the transaction. Putting together 2 big global companies is never easy. Despite that, just over 6 months into the close of the transaction, we're operating as one unified company. We're serving our customers together and serving them better. And importantly, we're really starting to see the benefits of the combination come through.

Over the last 6 months, I've traveled the 4 corners of the earth, visiting our teams and talking to customers. The infectious energy within the business is powerful. And every time I walk away from a customer conversation, I feel even more convinced about the growth potential of our business. I hope you see that passion, that energy, that belief in the room today.

So today is primarily about giving you greater insights into the transformed Tate & Lyle, the power of our combination with CP Kelco and our growth opportunity as we look ahead. We'll also give you more clarity on our existing financial growth framework.

So I'll come to the agenda in a minute and take you through that. But before I do that, and we get into the meat of the presentation, I just wanted to take a step back and look at the bigger picture that's shaping our future and underpinning our growth potential. As we all know, societies across the world are facing major food and health-related challenges.

The incidents of obesity and diabetes is growing massively with the World Health Organization estimating that 43% of the world's adults are now overweight, yes, 43%. The global population is expected to increase by 23% over the next 50 years, not least because people are living longer. And that means we're going to have to produce a lot more food than we do today. And those challenges keep on coming.

Food systems are having a major impact on our climates with around 1/3 of all greenhouse gas emissions linked to end-to-end food production and consumption. 23% of that -- sorry, 20% plus of that comes from agriculture alone, which also represents around 70% of all of the water used in the world today.

For the food industry, these challenges are being exacerbated by trends such as the rise of anti-obesity medicine, the debates around ultra processed foods, changes in food regulation and labeling and worryingly, an increase in misinformation, particularly on social media, which is eroding trust in sound science. With all this complexity, what is clear is that governments and consumers across the world increasingly want food companies to provide healthier and more nutritious food and drink.

Just look at the U.K. government's announcements over the weekend. They also want food to be more sustainable, to be more affordable, to know where it comes from and to have simpler or cleaner labels. But at the same time, they won't compromise on taste and also want food that meets the demands of their busy lifestyles. So food companies, our customers are facing unprecedented challenges to navigate this increasingly complex world. I should know, I worked in the food industry for over 30 years, 20 years as a customer of Tate & Lyle. So I believe the food industry is at an inflection point.

To meet the health and dietary challenges the world is facing, a significant proportion of the food and drink we consume today will need to be reformulated to improve nutrition through removing sugar, fat and calories and adding essential nutrients such as fiber and protein. This will be required whether someone is young or old, thin or overweight. The need for healthier, affordable and more nutritious food at scale is universal. And that's why over the last 7 years, we have intentionally and systematically repositioned Tate & Lyle to be right at the center of the future of food with the portfolio and the capabilities and the global reach to meet our customers, consumers and society's demand for healthier, more nutritious and sustainable food and drink.

Today, Tate & Lyle is a global leader in reformulation, an expert in taking sugar, calories and fat out of food and drink and adding fiber and protein. Our combination with CP Kelco has significantly increased and strengthened our customer offering, particularly through their expertise in mouthfeel. And as we will show you today, mouthfeel is the key unlock to nutritionally improving food and maintaining great taste. And if food doesn't taste good, no one is going to eat it. The new Tate & Lyle is a purpose-led, science-driven and customer-focused business with the portfolio and the capabilities to help solve food challenges of today and tomorrow. Let's look at how we live that purpose.

[Presentation]

This is a totally different Tate & Lyle to the company I joined 11 years ago. With that in mind, I want to leave you with 4 clear messages about the business today. Firstly, following the combination with CP Kelco, the structural transformation of Tate & Lyle into a specialty solutions business is now complete. Secondly, with our leading positions across sweetening, mouthfeel and fortification, we are well placed to meet growing global demand for healthier, more nutritious food and drink.

Thirdly, our unique portfolio and enhanced capabilities significantly increase our ability to be the solutions partner of choice for customers. And lastly, we have a clear strategy for accelerating growth and delivering attractive shareholder returns.

We have 3 objectives for today's event: firstly, to give you some more insights into the transformed Tate & Lyle. Importantly, with a deeper look at the CP Kelco business and the power of the combination. Secondly, to set out what makes us different, what gives us a competitive edge in the markets with a particular focus on the importance of mouthfeel. And thirdly, how are we going to deliver on our focus of accelerating growth through customer solutions, addressing key societal trends and driving science and innovation.

Let's start by talking briefly about the Transform Tate & Lyle. Since 2018, we have taken a number of concrete steps to reposition Tate & Lyle as a growth-focused Specialty Food & Beverage Solutions business. We've transformed the way we focus on customers and on the categories where we can have most impact and deliver most growth. We've accelerated investments in R&D to establish world-class scientific capabilities and in the commercial capabilities and infrastructure across key markets to serve our customers better globally. We've reshaped our portfolio to focus on specialty food and beverage solutions through strategic acquisitions and selling our commodity business premiums.

And finally, we combined with CP Kelco, one of the most admired and well-respected businesses in the ingredients industry. Following this combination, the structural transformation into a specialty solutions provider is complete and the business is well positioned to accelerate growth. Over the last 5 years through this transformation, we have created a GBP 2.1 billion revenue specialty business with an attractive pro forma EBITDA margin of 21%. This margin profile benchmarks well to our specialty ingredients peers. And looking forward, our ambition is to accelerate top line growth and underpinned by operational leverage to deliver stronger EBITDA and earnings per share progression.

A key driver of our margin progression has been the leading market positions we have built in each of our 3 key platforms. In sweetening, through our toolbox of ingredients and solutions and over a century of scientific know-how, we are the market leader in sugar and calorie reduction. Mouthfeel is a critical area of the food matrix. And following the combination with CP Kelco, our range of pectin, clean label starches and specialty gums are unrivaled in our industry.

Our third platform of fortification is based mainly around our leadership position in soluble dietary fiber with a smaller offering in plant proteins. The strategic focus of our transformed business is simple and clear. Based on our market-leading positions and unique scientific and solutions capabilities, we are a leading and differentiated specialty Food & Beverage Solutions business, delivering sweetening mouthfeel and fortification across our 4 key categories.

Throughout our transformation, we have successfully delivered our strategy through our strategic growth framework. This is based on 4 pillars: accelerating innovation, portfolio expansion, integrated solutions and market focus with serving our customers at the core. This framework is supported by our scientific and technical know-how, solutions capability, our increasingly resilient global supply chain, the talent of our people and our culture.

CP Kelco is the perfect fit with our strategy and strengthens each of these 4 pillars. It brings unique technical and solutions capabilities and a high-quality portfolio operating within our existing addressable market. As we'll explain more later, it takes us from having 2 to 7 of the main mouthfeel ingredients used in food and beverage applications. the broadest of any player in the market and expands our presence in faster-growing markets. At its core, Tate & Lyle remains a purpose-driven business, committed to transforming lives through the science of food.

It's been clear from day 1 that our new colleagues from CP Kelco share our sense of purpose and are committed to delivering growth and positive social impact. The figures speak for themselves. Over the last 5 years, through our sweeteners and fibers, we have removed over 40 trillion calories from people's diets. That's more than the recommended daily intake of the entire global population. We've also donated 4.6 million meals to food banks and other charitable partners to support people in need. And through our award-winning regenerative agriculture schemes, we've reduced our Scope 3 forest, land and agriculture greenhouse gas emissions by an impressive 31%. And remember, 2/3 of the climate impact of food comes from agriculture.

So in summary, the Transform Tate & Lyle is now a global high-margin specialty business with a clear focus on accelerating growth. It's also a highly cash-generative business with a strong balance sheet providing the flexibility to invest in future growth and deliver attractive shareholder returns.

Moving next to what makes us different. For me, it's a combination of 3 key reasons: Firstly, we have the broadest ingredients portfolio and solutions toolbox across our 3 platforms. Secondly, our unique capabilities to formulate across our 3 platforms provide us the opportunity to give customers the solutions they need. And thirdly, our unrivaled scientific and technical expertise allow us to invent and create new opportunities for growth.

Let me take each one of those in turn. In each of our 3 platforms, we now have a market-leading position. In total, we have over 1,000 different sweeteners, starches, pectins, specialty gums and dietary fibers, all with their own functional attributes or nutritional benefits. We formulate these ingredients into solutions which solve a huge range of customer challenges including sugar and calorie reduction, sugar replacement, thickening, gelling and added nutrition. Each of these platforms have large addressable markets totaling $20 billion.

This slide shows the breadth of offering in each platform. As you can see, the sweetening and mouthfeel platforms are already sizable and have significant growth potential given the food trends we see. Whilst comparatively small today, the fortification platform also has significant growth potential, particularly given increasing awareness of the importance of fiber in the diets, which we'll talk about more later.

The second reason why we are different is our ability to formulate across the intersection of sweetening, mouthfeel and fortification. Reformulation sounds so simple but it's far more complicated than just swapping one ingredient for another. Taste, texture, mouthfeel, shelf stability, all these must be taken into account when reformulating food and drink. Taste is also inherently local, which means that food and drink also needs to adapt to local preferences. It is our ability to formulate across all 3 platforms in local markets, which gives us a unique proposition for our customers.

In mouthfeel, as I've said, our capability is significantly enhanced by CP Kelco. For example, our food starches are very effective at providing bulk, but when used on their own, they can sometimes result in a texture that's too gelatinous. Now with CP Kelco's products, we can modify the viscosity and texture of foods without significantly altering the taste. So by combining these ingredients, we can create a significantly enhanced mouthfeel experience whether to support the century appeal of a product or to deliver improved nutrition. We can also create textures that are suitable for specific dietary needs, such as gluten-free baking.

The third reason is our scientific and technical expertise, which is now unrivaled in our industry. By combining our expertise in areas such as bioconversion, fractionation and separation science with CP Kelco's expertise in biofermentation and extraction, we are opening up new opportunities to develop the next generation of ingredients and solutions and increased interest from customers. So the broadest portfolio across our 3 platforms, our unique ability to formulate across those platforms and our unrivaled scientific and technical expertise. That's what makes us different, and that's what gives us an edge with our customers.

For me, there's also another reason why we have an edge, and that's our experienced and performance-focused management team. A team with belief in the potential of our business, which you'll see today, a desire to accelerate growth and the desire to make a positive impact on the world we live in. This is a team that is truly purpose-led with deep customer knowledge, extensive industry experience and a real belief and commitment to delivering our growth strategy.

Together, the team has more than 200 years of combined experience in the food industry. It's also a gender balanced team, a strong signal to the organization that we want a truly inclusive workforce and culture. The leadership team includes 2 members from the CP Kelco team, Didier and Jerome, both of whom are here today as our 5 other members of our executive team.

I'm also delighted to announce today that Melissa Law, who has run our global supply chain for the last 7 years, including our highly successful productivity program, is taking on the position of Chief Commercial and Transformation Officer. I'm also pleased that Kim Faulkner, an executive from Colgate-Palmolive with nearly 30 years of manufacturing and supply chain experience, will be joining us in August to become our new Chief Supply Chain Officer. Kim will be a great addition to our team.

Moving to the third objective for today, which is demonstrating our ability to accelerate growth. I want to start by reminding you of our financial algorithm over the medium term. Given the significant benefits of the combination with CP Kelco, on average per year, we continue to expect the enlarged Tate & Lyle will deliver revenue growth towards the higher end of our 4% to 6% range. EBITDA growth ahead of revenue supported by stronger operational leverage and the benefits of cost synergies in the 2027 financial year.

Earnings per share growth ahead of EBITDA and with strong cash generation and supported by a strong balance sheet, the ability to invest in further growth. Let me explain why I believe we are well placed to deliver this algorithm. Firstly, we operate in a large and attractive market. The global specialty food ingredients market is around USD 70 billion and is expected to grow in value by around 2% on a compound annual basis over the next 3 years. $20 billion of this market is addressable by Tate & Lyle's 3 platforms and is expected to grow ahead of the wider market at 3%.

Drilling down a bit further, 70% of our addressable market sits in our 4 core categories of beverages, dairy, soup, sauces and dressings and bakery and snacks. These categories on average are expected to grow between 2% and 4% over the next 3 years. With our expanded portfolio and enhanced capabilities, we are ideally positioned to benefit from these growth opportunities.

The other 30% is in categories such as confectionery and infant nutrition, where we have regional expertise and which also offer good growth opportunities. It's also worth remembering that while the global specialty ingredients sweetener market is around $6 billion, sugar still makes up around 80% of the global sweetening market. And so there is an estimated further $3 billion of sugar replacement opportunity across our 4 core categories in addition to the $20 billion addressable market.

So what gives us confidence that we can grow ahead of the overall market from the 2027 financial year? It's based on 3 main factors: firstly, how we have repositioned the portfolio to benefit from growing food industry trends. Secondly, the delivery of the benefits of the CP Kelco combination; and thirdly, continue progress in mixed price and solution selling. Let's look at the market penetration opportunities we believe will drive an acceleration in top line growth because of the way we have repositioned our portfolio.

Firstly, there are the societal trends I talked about earlier, including population growth, heightened awareness of the link between diet and health and the continued need for convenience, which all offer growth opportunities. Secondly, food industry trends offer significant market penetration opportunities. As I mentioned earlier, probably the biggest is the opportunity to reformulate ultra-processed food to improve its nutritional content.

Other areas, which, of course, are interrelated include increasing demand for sugar and calorie reduction, fiber and protein fortification, cleaner labels and cost optimization. We expect the benefits -- we expect to benefit disproportionately from these trends given the repositioning of our business.

The third driver of accelerated growth is delivering on the power of the CP Kelco combination. This includes leveraging our expanded portfolio and enhanced technical capabilities with both existing and new customers, particularly from our leadership in mouthfeel, also benefiting from our increased presence in the faster-growing markets of Asia, Middle East and Africa and Latin America and, of course, delivering on our targeted revenue synergies. All the presentations you will see today will address these market penetration opportunities in more detail and our ability to accelerate growth.

The agenda for today's event is on the screen. I will surely hand over to Didier Viala, who will give you a deep dive on the CP Kelco business, followed by Bill Magee, who will talk about the power of the combination. We'll then have a short break, after which our mouthfeel solutions, nutrition and science and innovation teams will talk about how we are working with customers to accelerate growth. We will finish with Sarah, our CFO, bringing it all together in our financial framework before I will return to summarize before a Q&A session.

With that, let me hand over to Didier, who is our Chief Solutions Development Officer, and before that, the President of CP Kelco. He is already making a huge, huge difference to the way we are managing our 3 platforms, and I'm delighted to have him on our team. Didier, over to you.

Thank you, Nick. And I'm very, very pleased to be here today and to have the opportunity to speak to you about CP Kelco, a company I led for 8 years and -- which I'm very passionate about and proud of, actually. A little bit about myself. I'm French, as I'm sure you can tell, but I spent most of my career working around the globe and most recently in the U.S., where I'm based today. I'm an engineer by training, has upgraded in food technology and chemical engineering and I spent more than 30 years in CP Kelco, having several leadership positions, including innovation, marketing, business development, global operations of sales.

I was President of CP Kelco from 2017. And along with the leadership team at CP Kelco, we recognized a while ago that we needed a strong partner to take the business to the next level. For us, it was very clear that Tate & Lyle will be a perfect partner. And we knew that the commercial, operational or cultural fit was extremely strong. Obviously, while it's still early days, and we have so much more we can do to realize the potential from the combination. From the way customers are engaging that I see every time I meet with them. From the way our 2 teams are working together, I know we made the right decision.

So my plan for today is to give you a few more detail on CP Kelco and then hand over to my colleague, Bill Magee, who will talk about the power of the combination. So if I had to explain CP Kelco in 3 words, I would use science, customer and nature. If we start with science and CP Kelco is a little bit of a nerdy business, if you see what I mean. Our products are complex to make, and they require a lot of technical expertise to use. And at CP Kelco, we really love to solve technical problems.

We enjoy innovating and find new way of doing things. So science and the pursuit of technical excellence is deep in our DNA. The second one is customer and customer obsession is part of CP Kelco mark of fabric. Customers is what we think about when we come to work in the morning and customers is what we think about at the end of the day, when we go back home.

That's the combination of strong technical expertise and customer intimacy which gives CP Kelco it's unique proposition for customers. And the last one is science. We are obsessed by using technology to unleash the power of nature. We are a natural derived business. And for that reason, environmental sustainability is core to our business as it is for Tate & Lyle and yet another reason for such a strong fit.

So let me now introduce you to CP Kelco and give you an overview. CP Kelco is made of the combination of 2 businesses: Kelco which was founded in 1929 in San Diego, California; and CP, Copenhagen Pectin, which was founded in 1934 in Denmark. Both businesses merged to create the CP Kelco company in year 2000.

So what you can see is that together with Tate & Lyle, we are more than 250 years of combined industry experience. And before the combination with Tate & Lyle, CP Kelco had always been a privately held business. And as such, we may not have been known outside of the food industry.

But within the industry, we were well established, and I believe were respected for more than 90 years. During that time, we partnered with many ingredients company, actually including Tate & Lyle for the past 10 years on innovation project. And from that collaboration on innovation, we knew that Tate & Lyle was the right partner for us.

So we are a global business, operating 7 manufacturing sites in the U.S., Denmark, Germany, Brazil and China. Our business model is to service customers locally. And we do that using 9 regional innovation labs and 2 global innovation centers in Atlanta, U.S. and Copenhagen, Denmark. So all those sites have been very well maintained, funded and invested on following an investment program -- capital investment program of about GBP 400 million for the past few years. So for those of you who will visit Denmark, our site on Thursday, you will see that our employees are actually very engaged, excited about the combination and not only focusing on servicing our customers by looking after its [indiscernible] and the planet will live on through our sustainability programs.

At CP Kelco, we are creating and manufacturing products using 2 very distinct technologies. pectin, carrageenans, locust bean gum, citrus fiber are produced by extraction from natural resources in our plants in Brazil, Denmark and Germany. The specialty biogum's product such as gellan gum or diutan gum are manufactured using microbial fermentation in San Diego, California, U.S., Okmulgee, Oklahoma, U.S. or Wulian in China.

If I now look at our business, it's very well balanced geographically where we do have 1/3 of the business coming from the Americas, 1/3 of the business coming from Europe, Middle East and Africa, and 1/3 coming from Asia Pacific. If you look at the technology platforms to the right, you can see that about a little bit more, 54% of our business is coming from extracted products while the other half is coming from fermented products. So very well balanced of our platforms as well.

Now this slide, we show the breakdown of the revenue for last fiscal year by products, by industry or by categories. To start to the left, you see that our main product is pectin, and we are a clear market leader in pectin with about 46% of the sales. Most of our sales are in food and beverage products, 77%. But the rest, the balance about 23% is done in nonfood categories. And those are primarily specialty biogums which are used to replace petrochemicals in consumer care or household applications.

And to the right, if we segment down the main food and beverage sales in categories, you see that about 40% is made into beverages, 24% in dairy and then going down into soup, sauces and dressings. So our products do provide very specific functionalities and they're used in many different ways, always to meet growing consumer demand for healthier, more nutritious, more sustainable products.

Pectin is always the ingredient of choice for clean label, consumer-friendly products, while specialty biogums like gellan gum will be used to tackle suspension, thickening, stabilization, good gelling problems into formulations. So for example, if you take jams on confection -- or confectionery products pectins will be used to provide the right gel texture. But pectin can also be used into drinking yogurts, to protect the proteins and making sure you've got a very smooth mouthfeel and not the chalky ones, which you will reject.

Gellan gum, for example, is used a lot to suspend fruit pulp or calcium into beverages. It can be used to keep soymilk or oatmilk, separated so that it's evenly distributed into the bottle. And all that without having a very thick or rich mouthfeel, which you would not like in a drink. So very unique functionality.

If you look at our positions on the market, and we worked over the years in building market-leading positions on all of them. We are clear market leaders as said for pectin, for gellan gum, diutan gums [indiscernible]. We are enjoying leading positions as well on carrageenans for dairy and desserts applications. So what I want to highlight is that about 80% of our sales are actually coming from products where we enjoy a market-leading position.

And when you look at that portfolio, together with the offering from Tate & Lyle and a very, very rich portfolio they have in starches, for example, we are the only company on the market that can now offer mouthfeel solutions for customers, having proprietary hydrocolloids, gums and starches in our portfolio.

As you can expect, raw materials are also key to our products being natural resources. Pectins are extracted from citrus peel and we use mostly orange peel, but also lemon and lime peel. We are the only pectin producer, which is integrated into the raw material. And we're enjoying a very, very competitive position in Brazil where we are located into the Sao Paulo Citrus belt, where we are actually processing pectin from wet oranges or drying using patented process to ship it to Denmark and Germany plants. We are a very, very diverse supplier base. We've been working with them for a long time, and that's very, very important to have a stable supply and quality supply for pectin.

If I look at biogums before going on the other resources, it's made out of glucose syrup, and the volume we're taking are negligible in the industry. So no real strategic raw material layer. The other one would be seaweeds where we're using cold water seaweeds, from Chile, mostly or warm water seaweeds from Zanzibar in Africa. Again, we are integrated into there. Sustainability for those strategic raw materials is paramount. A couple of the examples in Brazil, which is a great example of product circularity for pectin and peel, we are also using biomass to produce steam and therefore, limit our CO2 emissions.

While for carrageenans and seaweeds in Zanzibar, our operations there are already B Corp certified showing the importance we have for sustainable farming or community involvement. So you heard me talking about customer obsession. And if we had a customer here today, I'm sure that they will tell you that CP Kelco is different and it's different because of our product quality, technical knowledge and service and customer service overall. But let's hear from them. We asked 4 customers in Asia to actually do a video as a testimonial for CP Kelco.

[Presentation]

So to me, that's extremely gratifying to hear about those executives. I know that they are excited about the combinations. So I hope that you have some more insight into CP Kelco and the business. And for those of you that will be visiting [indiscernible] in Denmark on Thursday, you will see but also taste a little bit more. So now I will call Bill Magee to the stage to talk about the power of the combination. Thank you.

Thank you, Didier. Good afternoon, everyone. I'm Bill Magee, and I'm President of our Americas business. I've been with Tate & Lyle a little over 7 years now and before that I spent a good portion of in my career are companies like Monsanto, Romanhas and Dow, running businesses that made ingredients for food packaging. So what I often say is I've moved from being wrapped around the food to now being inside the food. I'm actually a lot less annoying at the grocery store now because I don't have to destroy things to figure out if my ingredients are inside. I can just read the back of the package. And if it's something interesting, I can snap a photo and maybe even send it to somebody around the world about a possible customer opportunity.

I'm here today excited about the combination with CP Kelco because of the journey that we're now on with our customers. And I'm incredibly proud of the passion that I see in our combined teams around the world to both seek and solve our customers' toughest challenges. After all, it is our customers who are working to redefine food and make it better for the future and they need our help. Together with CP Kelco this combined business can do more for those customers. We can solve tougher challenges. We're not just a different partner, but we're a better partner.

One of the reasons that the combination of these 2 businesses is so powerful is the complementary nature of these businesses. Almost 80% of CP Kelco's revenue is in the mouthfeel platform. You're going to hear more about that today from our experts who will join us after the break. And 90% of CP Kelco's food derived revenue is in Tate & Lyle's already core categories of beverage, dairy, soup sauces and dressings and bakery and snacks. And almost half of the business is in growing parts of the world like Latin America, Middle East and Africa and Asia Pacific. So this combination makes us more powerful from a platform perspective, from a category perspective and from a geographic perspective.

Another part of this combination that makes it -- that is powerful is it increases our access to our customers around the world, which will allow us to accelerate top line growth. Almost 60% of CP Kelco's revenue is derived through distribution partners. And what does that mean? It means that there's a third party in between us and the customer. And 1/3 of CP Kelco's direct customers are new customers to Tate & Lyle. So almost about 3/4 of this business, there's a real opportunity for us to build intimacy and relationships with those customers directly to again seek and solve their toughest challenges which will enable us to accelerate top line growth. Now it's early days, but we're already seeing examples of this around the world.

For example, in the U.S., at a large dairy customer, where as Tate & Lyle, we had struggled for a number of years to develop the right relationship and business with this customer. But CP Kelco on the other hand, had really developed a nice relationship and a meaningful piece of business. We're facing that customer now as the new Tate & Lyle, leveraging that relationship that was built, but deploying an expanded set of capabilities and products, and we will be able to cross-sell and grow with that customer very quickly.

We're also deploying energized market -- promotional material around the world to make sure that we can engage more with our customers from updated marketing campaigns, to reinvigorated customer workshops and innovation days that we do at our customer locations. And we're having a lot of engagement on those very early on in the process. One of the reasons for that high level of engagement is that we have built a leadership position in mouthfeel.

Our mouthfeel team will be with you later on this afternoon to go through the detail. But what I can tell you is, in my initial conversations with customers, there's a lot of very early engagement in this area. Literally, since the first day we announced we were combining these 2 businesses, customers have been asking us to come talk to them about what we can do together by bringing these portfolios into one business. A couple of weeks ago, I sat together with Jerome Bera and Remington Zhu, talked about some of the great things that our teams around the world are doing with our customers, and I'd like to share with you what we've talked about.

Bill, Jerome, Remington thank you for joining me to discuss the Tate & Lyle, CP Kelco combination. I'd like to start by asking you each what excites you about the combination?

I've been talking a lot about the expanded portfolio of products in the different way we're showing up with our customers, and we'll probably talk a bit more about that here today. And I still believe that, but what I've been thinking about today is the power of bringing our teams together, and we just brought the Americas team together in Miami a couple of weeks ago, and you start seeing how we all bring a different sort of value to the customer conversation.

So Jerome and I were talking earlier, I was thinking about what have I seen, what were CP Kelco people doing that we didn't do as well, right? And I think about technical on-site with the customer solving problems in their manufacturing operations. I'm seeing some unique things there. And I think you were saying that you might see some same things coming from what were Tate & Lyle expertise. Maybe you'd like to share that.

No, absolutely. I think the power of the combination, the excitement coming from the combination of the 2 businesses, first of all, it gives us scale, but I think we didn't have certainly at CP Kelco. And I think even Tate & Lyle was lacking scale so to speak. So scale, not only in terms of the breadth of the portfolio we now have that will allow us to solve a broader set of customers' challenges and innovation needs going forward. But it's also kind of the breadth of the capabilities, but the 2 organizations coming together unlocked for our customers.

Same impact, I think Bill and Jerome have mentioned that we've got bigger portfolios. We have better capabilities. And there's another thing is we've got a bigger customer base. Right? So in some of the countries, because APAC got wider geographic coverage, right? So we got Japan, South Korea, Greater China, ASEAN, India, Indonesia, there's a lot of countries there. So in some markets, actually, combination of the 2 companies brings a much better customer base coverage.

How does the combination enhance what we can do with customers. So what can we do today that we couldn't do prior to the combination?

Clearly, again, coming from CP Kelco, clearly we have a different portfolio and probably different level of capabilities, I will say. And by capabilities, I mean, really end-to-end starting with consumer insights, where I think we are here really strong, solid expertise, legacy Tate & Lyle on that. I'm linking those consumer insights all the way kind of customers beliefs, changes, formulation, innovation needs. So I think that's something we could not do on our own at typical core clearly not adding to a sensory expertise, regulatory affairs, nutrition -- kind of nutrition science expertise as well. So really clearly enhanced set of capabilities.

I think another new enhanced capability for the combined organization is the category model we deploy in region at scale. And by category, it's really allowing us to speak the language of the customers in a more meaningful manner for them and their teams as well. So I think that's really a large unlock, I think, for the combination and especially on Marfield, claiming Marfield leadership and demonstrating that to our customers that set of capabilities will clearly make us a more stronger partner for our customers to...

And maybe to bring it to life with maybe an actual customer example. And I'll start with general and maybe get more specific, right? Before the combination, our food scientists at Tate & Lyle would formulate with pectin, right, for sure, right? Because we know the functionality of the ingredient, but we didn't have the integrated all the way back to the fruit, expertise to optimize how we would deploy that in a solution, right? So in the last few months, we've had a major consumer products company, one of our largest customers, we had an innovation day event. We've done these before, but we were able to do it in a different way. You bring 100 scientists at your customer together and you bring them prototypes and you show them things that you can do, right?

And we had brought a prototype in this most recent one, that was a gelatin-free marshmellow, for example, which is kind of hard to do, actually. And the customer was quite surprised about the type of texture and mouthfeel they were seeing in that. And it sparked an interest for them to do something that maybe they thought was either impossible or harder to do in partnership with us. And I'd say that's different, right? It's deploying the same model we've used but with more tools, more expertise, more capabilities.

Yes. Similarly, I think talking about the mouthfeel, Tate & Lyle used to only talk -- mainly talking about starch. Now we've got more tools and more products to talk about with our customers. We even can come with some entrepreneurial solutions to our customers. For example, in the FIC back in March, usually when we do the prototypes of beverage, we mainly talk about sugar reductions, right, the sweeteners, Stevia, et cetera, et cetera. Now we are talking about coffee with gellan gum, right.

There is the combination of sugar reduction plus the mouthfeels, which has really created a wow to our customers. And then running the FICs, some companies just show strong interest and we follow up and then there's a potential business pipeline is coming. So that really opened up a more doors for us and more entrepreneurial solutions, which customers really want.

Actually, it surprised me a bit, if I'm honest. We saw our customers pulling us into a combined conversation literally from the first day. And I think what that says is they understand the logic of what we're trying to do and the strategy and how they -- how we can help them. They're pulling us into those conversations early, right? So another example, right, a customer that we had already been working with as Tate & Lyle, was putting together a protein shake, right? And they were asking us to do something. We just couldn't do it, right?

Well, right after the combination, we're able to pull in some experts from Jerome's team or from somewhere else within what was CP Kelco and we were actually able to address the problem, right? And you see that, that creates the credibility in that customer organization that the next problem they have. We're going to be the preferred place they go to, right? And I think that you really start to see that accelerating now as we deploy one face to customer, it's going to go even faster.

Yes. To build on that same thing. I had the privilege to meet different customers in the EMEA region, kind of regional players, larger CPG global players as well. And I think the feedback has been very consistent. They clearly understand the rationale for the combination. Our portfolios are very complementary. And they see that. And the challenge is on us now to show them, let's make it happen.

Yes. I just want to add on one thing that I would be remiss if I didn't mention because we talked about it a lot. We've had customers come to us now and say, "Wow, I'm excited. I can now work directly with your technical experts because our customer models between the 2 companies are different. And we're moving now with the scale that we're able to have across the world and across my region, to be able to have those really one-to-one conversations with customers. So we've had very early requests to say, okay, there's always been this kind of third-party wall between me, the customer and the technical experts. Now I can have those conversations directly because -- and I believe that can help me to move faster and you partner with us." So we've seen a lot of requests very early for those direct connections.

What sorts of projects are we seeing in the pipeline? Are there any specific customer wins that you can paint a picture for us today?

Well, we have some wins, cross-selling wing. So within APAC, we have some internal competitions. We'll get the first cross-selling orders and the India team stand out. They got the first order. So one legacy customers, CPK customers bought sweeteners and sell that to the nutrition customers. So that stand out. And other customers are following. In Vietnam, we also see some customers use our sweeteners in the coconut juice, which used to be the legacy CPK customers. So we see that starts to come. So it's a bit small here and there, but we see the momentum and the teams are excited.

Yes. Just to build on that, I think that we see tracking was engagement. We're having different conversations with customers. I know in EMEA, we've got more than 60 projects that were created since the combination and engaging with customers one unified commercial and tech service team. So really, the pipeline is building up, which will pay off. The typical development cycle in the food and beverage industry is like 12 to 18 months, depending on the geographies we operate into. So this will pay off.

And we had customers reaching out proactively customers we knew as one example in Europe, and health and wellness, very focused beverage company in Europe, trying to develop a cleaner label on expanding their range for functional beverages and clearly having citrus fiber coming from the legacy CP Kelco portfolio to complement some of our sweeteners, offering we're already selling to that customer just generate a new project for the team. So we have, yes, early signs of that combination, really, really going to pay out for our customers.

There are 2 areas that come to mind for me when you asked that question. We're seeing -- I'm seeing in the Americas, a lot of opportunity in the dairy space, which is a core category for both of our organizations. So -- and it is an area where the challenge of mouthfeel really tends to come to life and our toolbox is almost ideal to address some of those challenges, whether it be ice cream, whether it be drinkable yogurt. So we're seeing quite an interesting pipeline of opportunities come to life there.

Another area would be in the nutritional gummy space, right? I think in the U.S. right now, everybody seems to want everything in a gummy, but they also want it to be lower, no sugar. They want it to taste good, feel good, have the right texture in the mouth, and that's much harder to do than you might think it is. Our toolbox is really ideally suited to address those challenges right now. And there really is an opportunity to leverage each other's work across the regions here, right?

And this is where kind of our network, global collaboration centers with customers connected to the center around sharing best practices, sharing when we build a particular technical solution that could be deployed broadly and customized in the region. So a place like gummies we can leverage across the world as well.

How are we encouraging our teams and particularly our commercial teams to work together as one team now that we've come together?

Well, I think, yes, we've been encouraging them to work together since what, 6 months ago when we close on the transaction. We worked on standing up one commercial team in each region that became effective April 1. But again, that was -- the encouragement was not needed, quite frankly. Our people were curious to learn from day 1. What are you doing with that customer on your side of the portfolio, et cetera. So that positive build was there from day 1.

Well, I hope you can see the excitement that the 3 of us share around the work that our teams are doing with our customers around the world. And I can tell you that excitement comes from 2 places. The energy and passion that we see from our people working together on the ground and some of those direct interactions with meaningful customers who are really -- you really start to see what the future begins to look like as we bring these 2 businesses together.

So in summary, we've created a business with this combination that is stronger from a platform perspective in our core categories and has access to faster-growing markets around the world. We've increased our customer access, and we built a leadership position in mouthfeel. That's why we're confident that, as Nick said, we can grow this business ahead of the market in the medium term.

Now before we bring in our mouthfeel experts, we're going to give you a short break. So for those of you online, we'll see you in about 15 minutes. For those of you in the room, we have tea and coffee in the back of the room. We actually have some consumer products set up that contain our ingredients. I encourage you to take a look. And we have 2 separate sections of prototype demonstrations where you can touch and feel and taste some food that our ingredients are a part of. So I hope you enjoy it, and we'll see you back here in a few minutes.

[Break]

Perfect. So welcome back for the second half. It's me Mr. Instructions again. You've got some enticing intriguing cakes on your tables. Please don't touch them. They're part of the next session. When we want you to eat them and experience them, we will, and enjoy the second half.

I'm now going to hand over to Dr. John Stewart on mouthfeel. John?

I'm going to talk about one of the most important areas in food, which is Mouthfeel. My name is Dr. John Stewart, and I lead our Mouthfeel platform. I started with Tate & Lyle in 2010 when I started my career in academia as a neuroscientist, studying sensations and perceptions on how we experience the world around us. Now at Tate & Lyle I've worked on innovation, strategy, M&A, but mostly in commercial roles, working closely with our customers to really understand what it is that they need, what they value on how we here at Tate & Lyle can help our customers to be successful.

So 3 key messages I'd like to share with you today. One is that Mouthfeel is at the center of food and drink formulation. So for formulation to be successful, you have to get the Mouthfeel just right. Second is that the combination of Tate & Lyle and CP Kelco creates a leadership position in Mouthfeel. And third, that our unique portfolio and technical expertise, particularly in Mouthfeel is really accelerating the solutions that we develop for our customers.

But let's start right at the beginning. What is Mouthfeel. So from the earlier stage, we have a very primal response to foods to eating. Very early in life, we start to develop individual preferences for one food over another. Foods, we like, foods we dislike. But what makes us prefer one food over the other. Well, very often, this is done to the mouthfeel. So the way that the food feels in the mouth when you're eating, that texture and sensation you experience when you're eating foods and drinking drinks.

But mouthfeel is more than just texture. Our perceptions of mouthfeel can be influenced by things like the appearance of the food or even the sound the food makes in the mouth while eating. So think of a food that you really like. Think of your favorite food, we'll do this together. Imagine your favorite food and think that you're eating it right now, just imagine that you're having that food. What is it that you like about that food? Is it the way that the food feels in your mouth when you're eating it? Is it crispy or crunchy. Is it creamy or smooth? Is it light or airy? Well, that is mouthfeel.

Now think of a food that you dislike, a food that you would normally avoid. Again, what is it that you dislike about the food? Is it the way that it feels in your mouth when you're eating? Is it dry or choky? Is it lumpy or gristly? Is it watery or slimy. So for me, that's mashed potato, by the way. I really don't like the mouthfeel from mashed potato, so I always avoid mashed potato.

So our customers know that creating the experiences that consumers love is key to a successful product. It's the difference between a product that's successful and one which fails. So they know that they have to get the mouthfeel right. And we all know what mouthfeel is instinctively, we've known it all our lives. But often, we don't realize how important it is and how we enjoy and experience foods.

Mouthfeel is also important for some of the big societal challenges that we face today. So as the world looks to nutritionally rebalance food at scale, Mouthfeel becomes a critical unlock to making that happen. And that's why the growth opportunity is so large. The market for addressable Mouthfeel ingredients is estimated at $11 billion.

So let's look at some facts. Taste is absolutely king when it comes to food. With any 5% of consumers saying that taste is the #1 driver of a food product choice. And we know that mouthfeel is a key component of that overall taste experience. So it's no surprise then we see this reflected in product launches with 1 in 4 new product launches last year in food and beverage with a specific texture claim on pack. So our customers know that getting mouthfeel right in the formulation is absolutely key to achieving consumer satisfaction to product purchase and repurchase.

But reformulation is complex. And people often ask, if you want to make food healthier, why don't you just put in less fat and sugar to begin with? And of course, that's the challenge because ingredients like sugar and fat, they play a key role in food in terms of structure and function. And if you take these out, what you're left with, it may well be healthier, but it will not be very appealing. The mouthfeel will not be good. And as consumers, we're all less likely to choose those products and much more likely to choose an unhealthy option, whether we admit it or not.

So mouthfeel is critical to delivering a successful reformulation. And we want to make food healthier, more convenient, more affordable and using ingredients that we can all recognize to clean label. And we do this today. We work with our customers to take out sugar, fat and calories. And we add in nutrients like fiber and protein. But when doing that reformulation, it's key that the mouthfeel is right. If you get the mouthfeel wrong, the reformulation falls apart. So we're going to show you what we mean with the help of my colleague, Will Ballantyne. Will is a food scientist at our application center in mold here in the U.K. So I'm going to ask Will to come to the stage and talk us through the demo. Over to you, Will.

Hello. So as John said, my name is William Ballantyne. I'm a Technical Services Director for the bakery and nutrition category team here in Europe. And this is the interactive part now. So if you would like to each take 1A sample and 1B sample. So the trays in front of you on the table are all labeled. So there's enough for everybody just to take 1A and 1B, and then I will introduce them once everybody's got.

Yes. And just to make everybody aware as well. If you do have any allergies, then these samples contain wheat, gluten, egg and milk. So if you're concerned about those particular allergies or any allergies at all, then please refrain from consuming these particular demonstrations. So hopefully, everybody's got their A and B sample.

So you're presented with 2 cake samples. They are apple, oat and cinnamon cakes. Both have been reduced in sugar to the same level. The fat levels, the egg content all remains the same. So the recipes are identical with the sugar removed. The only difference is that in Sample A, we've done nothing to replace the mouthfeel. We've done no reformulation. We just removed the sugar and baked it, processed it in exactly the same way as the other sample. Sample B is our reformulated recipe. And we've done this through the experience of our people, but also the science behind our solutions and also the science behind that combined solutions portfolio.

So some examples that we've included in here are the soluble fiber, PROMITOR. We've also got NUTRAVA, citrus fiber. We've got Stevia flavors and a HAMULSION stabilizer system in there as well. And we've added this reformulation and these tools to build back the mouthfeel that should deliver on indulgence, but also a healthier cake. So starting with sample A. So your mouthfeel journey starts before you've even eaten the cake. The visual looks different to the other one, probably looks different from a normal cake that you've seen. That's the first part.

Now move on to the tasting. So please take your first bite. And you should start to notice that it's a little bit heavy, a little bit dense, maybe a little bit dry and crumbly or even some wetness in there as well. This is typically not a desirable experience for consumer in a cake, and this is a product that we would say that consumers wouldn't want to buy again. You may have only taken 1 bite of that one. But if you have, then just take a little sip of water just to clean your pallet before you go for the next one. Sample B is our reformulated mouthfeel cake. As I said, same level of sugar reduction, but just had the mouthfeel replaced with some of our solutions.

First, in the mouthfeel journey, you already start to see that your cake is a little higher in volume. It's a little higher in height as well. The color is a little bit more appealing and also the crumb structure is what you would expect from a cake. Now you can try that sample. You should start to notice the differences between A and B. It's a lot more lighter, a lot more airy, a lot more what you would associate with an indulgent cake. But just remember the sugar has been reduced in this. I can also say that reformulating the product, to build back the mouthfeel.

We've also delivered a product that is high in fiber. It's non HFSS compliant, which means it's non high fat, salt and sugar. It also carries a Nutri-Score B on the consumer labels in Europe. So therefore, showing that by building back mouthfeel, we can deliver a healthier cake that is also indulgent. Thank you. Back to John.

Thank you, Will. So we've seen what mouthfeel is and why it's important. So now let's look at how the combination of Tate & Lyle and CP Kelco creates a global leadership position in mouthfeel. This is based on 3 pillars of expertise. So first is our consumer insights program in mouthfeel. Second is our cutting-edge mouthfeel science; and third is our market-leading mouthfeel portfolio. So we'll go through each of these in turn. So we have an unrivaled understanding of the mouthfeel space.

Our consumer insights team make sure that when we work with customers, we're bringing a forward-looking view of consumer needs and expectations for mouthfeel. And no one else in the industry really focuses on this area as closely as we do. And a key point of difference for us is our proprietary consumer insights. So we were the first company to develop a specific mouthfeel trends report that we launched last year in partnership with Kantar. And to develop this report, we used social media listening, expert interviews, consumer panels, to really identify what are the mouthfeel experiences that consumers have for their favorite foods and how do we see this evolving in the future?

So as you can see on the screen beside me, this identified 3 sets of trends elevated experiences, nourishment 2.0 and mouthfeel for a modern world, looking at areas like how the next generation of convenient foods, how will that impact consumer expectations of mouthfeel. And even things like climate change, how will climate change impact the foods we eat and how will that impact our expectations from mouthfeel experience. And this report has really resonated with our customers, and many have told us that we're now leading in this space of bringing actionable consumer insights in mouthfeel. And on your tables, you'll find some cards. There's a QR code on those cards. You can scan that code and download a summary of the report and see it for yourself.

So the second pillar of our expertise is obviously our cutting-edge science. And we're going to look at 3 areas here: our sensory science. So this is how we know that the consumer products that we help to develop create the mouthfeel experiences that consumers are looking for. So our sensory experts work with consumer panels and focus groups where consumers select their favorite foods and then describe in detail what it is that they like about them from the texture, the flavor and the mouthfeel. And our experts, take those descriptions and our consumers, their own language, and they translate that into a technical lexicon, which we can then analyze, design and replicate.

So application science. This is the science of how to apply ingredients in food. And with so many foods, ingredients, recipes and processing methods like drying and baking and fermenting and chilling. Having that knowledge to really help our customers use our ingredients in precisely the right way, that is key to their success. And the third area is our ingredient science. So this is where we develop the next generation of specialty ingredients through our innovation pipeline. Victoria will talk more about that later this afternoon.

So our consumer insights in mouthfeel are cutting-edge science. Add to that the leading portfolio of mouthfeel solutions and ingredients in our industry made possible with the combination with CP Kelco. So our portfolio now contains over 200 individual starches and over 600 pectins and specialty guns. And along with our fibers and our sweeteners, this gives us enormous versatility, flexibility and control over mouthfeel and everything from yogurts and dressings, snacks and energy drinks and so many more. And this range and versatility of our portfolio, this is unique. No one else in our industry has this breadth and depth across our 3 platforms.

So a key point I'd like to make is that because of the combination with CP Kelco, as we heard already today, we can now solve problems for our customers that we couldn't solve before. And customers have a broad range of formulation challenges and these can be summarized in 3 areas: optimize, reformulate and innovate. And when we work with our customers, we frame challenges this way to help us narrow down to the right solution. We're going to watch a short video now on customer needs.

[Presentation]

So how do we take our mouthfeel expertise and portfolio and translate that into an actual customer solution. So let's find out. So for that, I'll ask my colleague, Veronica Cueva, to join me on the stage. Veronica is our Vice President of Applications and Solutions Development, and she'll take us through a practical example. Over to you, Veronica.

Good afternoon, everybody. I hope everybody is keeping themselves hydrated because it's extremely hot here. So make sure you're drinking some water that you have in your table. So as John said, my name is Veronica Cueva. I am a food scientist at food engineering. I have been in food industry my whole career and with Tate & Lyle the last 13 years. I actually was a former customer for Tate & Lyle.

During these 13 years, I have seen a major transformation in our capabilities, our resources and our actually solutions offering due to following the investments and the standard of those capabilities in areas as sensory science, analytical science, regulatory nutrition and applications, of course.

As John mentioned, in this session, I want to showcase a practical case study on how all this comes together, how all these capabilities and expertise comes together for us to deliver customer solutions. But first, let me remind you what we mean by solutions. A solution is created when we bring together our capabilities in applications, category expertise and a broad ingredient portfolio toolkit.

When compared to ingredient sales, application solutions requires a much complex set of capabilities, but also strong inputs from R&D product development, our technical service and a good understanding of our customers, customers' processes conditions and understanding of how our ingredients are going to behave through those processes conditions.

We collaborate with customers in many different ways. But we know that when we collaborate in solutions, we have additional benefits. One, we build a stronger customer intimacy. We are much more engaged with our customers. The value of our ingredients in our solution tends to be higher and average 2x the value of that ingredient. For experience, as a scientist -- as leading group of scientists as informal customer, I can tell you that builds a stronger innovation partnership and most often leading more projects into our pipeline.

With consumer trends changing all the time, it is imperative that we work with our customers on those integrated solutions that they need today, but they also need for the future. To do this in a very effective way, we have developed a chassis approach for our solutions, effectively tailoring them the core solutions to meet local taste, local regulation and the specific customer challenges. Let me give you a quick explanation of what is this chassis.

Our formulation chassis is a base framework or fundamental piece of technical knowledge for a specific category. It is developed ahead for our global teams, application teams and then deploy and use to tackle customer challenges but our regional technical teams. What is really, really exciting right now is the combination of CP Kelco and Tate & Lyle has brought our portfolio, and we are developing new toolkits, chassis toolkits that we're going to bring to the market, especially in the area of mouthfeel. It is very exciting to stay tuned here.

So before I go to the example, I want to talk a little bit about another tool, a proprietary tool that our sensory scientists have created. The tool is called Tate & Lyle Sensation. Tate & Lyle Sensation is -- we've used to keep taking consumer insights and translating those in effective solutions. So let's see how we talk about sensation with our customers.

[Presentation]

So now let's look at how all these come together in practice. So we're going to present you better-for-you low-fat yogurt case study. So a dairy customer came to us with a challenge. They wanted to replace the gelatin in their formulation, but also improve the nutritional value of the yogurt. Replacing gelatin is not easy, especially when you really understand the mouthfeel and the functionality that gelatin brings to the system.

At the same time, we also have to maintain the indulgent mouthfeel, but also very important, we wanted to make sure that the yogurt stay stable through the process, through the shelf life and we have to be within this cost parameters dictated by the customer.

So how we start? So as John mentioned before, we approach these challenges leveraging 3 key areas of expertise. Our consumer insights, our cutting-edge science and our leading portfolio. So let's start. So we talk to consumer yogurt users because we wanted to understand what they like from the yogurt, what they don't like from the yogurt, what that they're expecting for a reduced fat yogurt. And this is some of the feedback that we received.

[Presentation]

We hear the consumers. Then we use a proprietary sensation, Tate & Lyle Sensation tool to make you -- to translate those insights to a sensory lexicon. With a sensory lexicon, our scientists in applications and sensory start assessing what is those attributes and what does those attributes mean when we think about the technical solutions and what is the combinatory effect of our ingredients that will help us deliver those sensory profiles that the consumer wants.

With the benefit of the new portfolio, we have an expanded portfolio of hydrocolloids, gums, starches, fibers and protein. Now we are able to input these ingredients in the formulation achieve different desired functionalities. The combination in CP Kelco and Tate & Lyle has increased -- significantly increased our solutions and chassis to kids and our ability to solve customer challenges.

In this real example, the solution that we deliver to the customer because we deliver a good solution. It has 2 different types of clear starches to be able to keep the stability of the yogurt through the process, but also through the shelf life. We utilized CP Kelco gene pectin to create a sub texture that is desired in the yogurt and the combinations of simplest whey protein concentrate and our PROMITOR soluble fiber enhance the softness and increase the nutritional profile of the yogurt. At the end, we meet our challenge. We were able to deliver enhanced nutritional profile of yogurt, a cleaner label, a smooth and superior mouthfeel and it was delicious.

So with that, I'm going to pass it to Dr. John to finish conclude our section on mouthfeel. Thank you.

Thank you, Veronica. So food is about enjoyment, food is about taste. We don't want to just feed people. We want to feed them well. But healthy food needs to be tasty if any of us are going to buy it, it's consumers. And that is where Mouthfeel is so important. We work with our customers to design the mouthfeel experiences that consumers love to help make tasty food healthier and healthy food tastier.

So let me wrap up by recapping on my 3 key messages. First, that Mouthfeel is absolutely at the center of food and drink formulation. Two, the combination of Tate & Lyle and CP Kelco creates a global leadership position in Mouthfeel. And three, that the unique portfolio and technical expertise that we now have particularly in Mouthfeel is really accelerating how we develop solutions for our customers.

And with that, I will hand over to the capable hands of my colleague, Dr. Clare Leonard, who leads our Global Nutrition and Health Sciences team. Over to you, Clare.

Thank you, John. It's becoming a bit of a competition up here. He thinks it's mouthfeel that's most important. I'd like to argue that maybe it's nutrition. But I won't argue with him because actually, it's quite exciting to have the combination of the 2, which I'm going to talk about today. So as John said, I'm Dr. Clare Leonard. I'm heading up the Global Nutrition and health science team here at Tate & Lyle. By way of background, I completed my degree and PhD here in the U.K. back in the 1990s. And since then, I've worked in big food companies like Mondelez, Unilever and most recently, the Coca-Cola Company.

I joined Tate & Lyle in January this year. This is my first role in an ingredients company. I was a little bit nervous about that, to be honest. I was not sure how I was going to bridge from brands to ingredients. But it's actually been an extremely positive and exciting journey. This is a company where we can truly make a difference to all of those brands through the ingredients that we're supplying. We can really make a difference to consumer health by altering lots of different brands nutritionally. And as a career nutritionist, that's quite -- a truly exciting opportunity.

To work for a company, as Nick said earlier, that has removed 40 trillion calories out of the diet over the last 5 years is pretty impressive stuff, and it just shows the scope of what we can achieve. So what's clear for me today is that the demand for healthier, more nutritious food is systemic, and it's really ever growing. And the nutritional balancing or rebalancing of foods is a growth opportunity for us. Tate & Lyle is incredibly well positioned to meet those consumer demands. And I know I'm a little bit biased but as a nutrition scientist, I would say nutrition is a huge growth opportunity for us.

So I'm going to start by looking at some of the data. And again, this has been mentioned but it's really rather depressing for me as a nutritionist, the obesity statistics. Worldwide obesity has more than doubled since 1990. And in adolescence, it's quadrupled in that time frame. It's estimated that 2.5 billion adults, 43% of the global population is either overweight or obese. So it's not altogether surprising then that there has been this monumental rise in recent years in the transformation and use of drugs to treat obesity. It's estimated that 15 million people in the U.S. are currently using anti-obesity drugs. And that's set to double by 2035, 35 million people or 1 in 9 consumers in the U.S. will be using anti-obesity medication.

By way of explanation, if you've heard of GLP-1s, those 2 terminologies are interchanged and forgive me if I use the term GLP-1, but it's a type of anti-obesity medication. It's become a common name for the anti-obesity medication you may have heard. And then lastly, the debate about ultra processed foods. It's not going away. The classification of foods into their level of processing was developed many years ago, and it's just gaining traction all the time. As a nutritionist, of course, I struggled with this slightly. Processing of foods is absolutely crucial to make sure they're safe, they're accessible and they're affordable to all. But actually, what really matters is the nutritional content of what goes in.

All foods have got to -- a different nutritional profile. And what really matters is at the end of the day, is making sure people are provided with the right nutritional profile to make a difference to their health. And last month, we convened a global roundtable on ultra processed foods. We brought together leading scientists in this field to understand the opportunities around ultra-processed foods. There is a significant and a growing opportunity for us here to nutritionally rebalance foods. So actually design foods, to design processed foods to make a difference nutritionally is crucially important.

And while food still needs to be processed, we are so well positioned to take out the sugar, the fat and add in other nutrients like protein and fiber and to really design those ultra processed foods for better health. But you know our Ultra process foods is beyond nutrition as well, and it brings us back to the mouthfeel discussion and texture. Because actually, when you think about it, the texture foods affects how much you consume. The rate of consumption is affected by its mouthfeel. And even further down, we have physiological responses that change according to the texture and the mouthfeel of those foods. So we can slow down the gastric emptying. We can slow down the way food is digested, and we can ensure people feel full after they've eaten.

So in simple terms, in addition to all the benefits that have been discussed earlier, our expertise in mouthfeel is actually really closely linked to developing texture-based solutions that could modify eating rates, they can modify nutrition, they can modify people's health ultimately. It's a really key unlock, both our reformulation capabilities and our mouthfeel capabilities.

If I turn to the anti-obesity medication, I'm going to start with a bit of science. At a basic level, what we eat leads to release in hormones that tell our brain, we feel full or not. It's through the release of the hormone insulin and the rate of gastric emptying that you begin to feel full and you begin to stop eating. The concept of society. And fibers and proteins can mimic the effects of some of these drugs. We want to put fibers and proteins into foods to mimic the effect of the drugs to help people more naturally feel full and satiated. And we've been out to conduct research to look at the anti-obesity medication users. And there were really these 5 critical areas that come to light. These consumers really need nutrient density. So when you're on these drugs, you actually can't consume a lot of food, you're eating a lot less. So for every bite, you need to make sure you get a lot of nutritional buck in there to ensure you reach your nutritional recommendations.

And then with regards to gut health, we do know that there are side effects when people are on these drugs, they feel nauseous, constipated, bloated, so we can help people think about that and find solutions for gut health. Society is incredibly important. We want people to feel fuller on a smaller amount of food and on a smaller number of calories. So helping people, especially when they reduce the anti-obesity medication or they come off. We want to ensure they continue to feel full so that they don't get this rebound weight gain. We tend to see that people do tend to gain their weight again within 2 years of coming off the anti-obesity medication. So how can we help people feel fuller through natural solutions.

Hydration, so in the same way that your appetite queues are suppressed when you're on these drugs, it's the same for your hydration queues. So actually, we need to make sure people are drinking as well as eating for good health. And then permissible indulgence. We all know what it's like to be withdrawn from food. Food is there for pleasure. And these poor people are working incredibly hard to manage their weight. They've taken to a medication solution. So it's only fair that these people continue to be able to enjoy the small amounts of foods and drinks they do consume. And Tate & Lyle are really well positioned with over 200 solutions already available to meet the needs of these anti-obesity medication users. And that's across the categories that we provide and across those solutions, those 5 areas that I've talked about. And our solutions can help before and during and after the medication journey.

So before -- you've heard a lot already about reducing fat and sugar out of foods, adding in fiber, helping people on a healthier nutritional trajectory. During the drug use, we can help create foods that are nutritionally dense, and reach -- help with society and then lastly afterwards. So the society becomes incredibly important there, as I mentioned, to help to prevent rebound weight gain. Now the good news is that there's going to be another tasting. And I'm going to ask my colleagues behind the scenes to bring out some samples for you to taste. We've got some examples that are going to come out to meet the needs of users that are on these anti-obesity medications. I'm just going to pause whilst they get to your tables. As these are coming to your tables, I will mention allergens again. We don't want any concerns here. So please be aware that there is wheat, sesame and milk in the allergens -- in the samples you're going to taste this afternoon. And I'm going to ask you please to start with the hummus and crackers. Go ahead and take some hummus and crackers, if you fancy it.

So I've already said that when you're on anti-obesity medication, your appetite is suppressed. People just don't eat big volumes of food and often people are replacing a meal with a snack. So what you'll see here is a snacking solution, high protein crackers and hummus. We have increased both the levels of protein and fiber in those crackers and the same with the hummus, to the extent that it is they've reached claimable levels from a regulatory perspective, so we can really help consumers know what products to choose. They reach the claims for excellent source of fiber and rich source of protein. When we talk to consumers, the texture as well as the flavor is critically important to enable liking. And they say they want -- consumers say they want crispy and crunchy crackers. And I hope that's what you feel you've got in front of you.

And I feel I'm going to rush you off your hummus and crackers, please feel free to come back to them. But let me move on to the high-protein milk shakes that you've got in front of you as well. Take a sample A and a sample B, and I will restate there is milk in here. If anybody's got an allergy, be careful. If you could taste Sample A first, please. Sample A is a meal replacement drink that is on the market in the U.S. It's designed to be especially high in protein to help people feel full on the high-protein weight management diet. And then try Sample B. Sample B is an improved chocolate milk that we have developed with an enhanced mouthfeel to meet the needs of people that are on anti-obesity medication. You'll hopefully see here that we've dialed up the creaminess and we've altered the mouthfeel of Sample B to ensure that we meet the needs of those GLP-1 users that I mentioned earlier.

Especially when you think about permissible indulgence, I think you'll agree that sample probably tastes a lot nicer. It's richer, it's creamier. Hopefully, it will help to soothe some of those digestive discomforts with the nutrition that's in there. And lastly, that Sample B brings ingredients from both Tate & Lyle and CP Kelco. So you're getting the best of both worlds. I want to talk a little bit about fiber before I leave the stage. Fiber is a key nutrient for all of us. This is a horribly complicated graph really. But the point is here in red. This is the recommendations across a number of different markets in the world. And the blue bars are actual intakes in some of those markets. And as nutritionists, we refer to this fiber gap, so the pink area.

There is a vast difference between what we're recommended to consume and what people actually consume in terms of fiber. I'm going to pick on 3 of my colleagues, please, to stand up. Bill, Victoria, Nick, would you mind just standing for a moment? There are 100 of us in the room here. There are 3 standing. Only 3% of U.K. adult population meet the fiber recommendations. That's statistics that came out from the National Diet and Nutrition survey a couple of weeks ago. I just think it's very telling when we think only 3 of us in the whole room. That's most of us missing out on an absolutely critical nutrient for long term health. And we know that consumers aren't eating enough fiber through natural foods through whole foods. So increasingly, it's recognized that we need to fortify foods with additional fiber in order to close this fiber gap.

And of course, Tate & Lyle is incredibly well positioned to do that as we are the leading provider of soluble fibers. But our portfolio does a lot more than just provide nutrients. This table shows you the green ticks is where we've been investing in nutrition research for many years to look at how our fibers and our sweeteners support consumer health in many areas that are top of mind and top of needs when we think of consumer health. Adding pectins to our portfolio gets me quite excited as a nutritionist because it brings new areas of health benefits that we're investing in. So to conclude, I want to leave you with 3 messages today. The demand for healthier and more nutritious feeds is systemic. It is ever growing. Hopefully, I'm not going to be out of a job as a nutritionist for a few years.

The nutritional rebalancing of food is a significant growth opportunity, and Tate & Lyle is well positioned to deliver solutions to meet consumer needs, especially when we think of those on anti-obesity medication and in the area of ultra-processed foods.

Thank you for listening. I'm going to hand over to Victoria, our Chief Science and Innovation Officer now. Thank you, Victoria.

Innovation distinguishes the leaders from the followers. And I really hope that through the presentations that Nick and my colleagues have done thus far, you realize that science is how we, at Tate & Lyle, harness the power of nature to drive innovation and deliver customer solutions. Hello, everyone. My name is Victoria Spadaro Grant, and I have served as Head of R&D for companies like PepsiCo, Mars, Cadbury, Barilla, and I am now Chief Science and Innovation Officer here at Tate & Lyle.

I have degrees in science and [ post-project ] degrees in science and makes me very excited and has helped me get tools and understanding to work with teams delivering innovation that is impactful and that brings to life the art of the possible. Ingredient size is fundamental to advance innovation and new solutions for our customers. As a former customer, I can assure you that the food industry does depend on ingredients innovation quite heavily. It is required to deliver new solutions that help optimize, improve the cost basis, reformulate for healthier options or better tasting options. And of course, innovate. We take agricultural crops such as corn, stevia, citrus fibers, chickpeas and we extract the goodness and convert them into highly functional molecules that have very special performance in consumer formulations.

Of course, it's not about solving today's problems only. It is today, it is tomorrow, and it is about the future. And we constantly push the limits of what is possible. And doing so, we create the next generation of specialty molecules that will continue positioning us at the center of the future of foods. Never done, now it has been more important to drive the science of ingredients, so we can support our customers and that is what is going to maintain us and help the customers reformulate. But to do that, we don't only rely on the significant expertise that we have in-house -- by the way, Didier mentioned that over 250 years and significant state-of-the-art know-how, we also expand and have created a very extensive network and ecosystem where we have partnerships and collaborations that we invest to be able to accelerate solutions and bring them faster to our customers.

You have heard many times today why we are all excited about the combination of Tate & Lyle and CP Kelco. And it is because of the important functionality that these 2 ingredients bring when they are used together. The power of mouthfeel. And it is -- when we combine these 2 portfolios, particularly the starches and the hydrocolloids that we have an unrivaled, unprecedented and, frankly, unique competitive advantage. We can uniquely serve our customers. And that is because we can create mouthfeel designs for very specific needs that customers have, like no one else can. But you may ask yourselves, you heard the word mouthfeel so many times.

So how is that done? What happens and why? So to do that, I would like to use an animation and I would like to describe first what is a starch. Starch is made of glucose molecules that link together, they wrap around themselves and they form small balls. Hydrocolloids are like strings, if you would. These are very large and heavy molecules that like and attract water. When we add water to a starch, what happens is that the starch swells. These particles of starch swell. When they start swelling, they start bumping to 1 another. And as they bump, it becomes a very thick structure. So think at home, if you have flour and you add water, it becomes thick.

When we add water to hydrocolloids, these large molecules, they attract the water, they disperse. They form a lattice. But the magic happens when we combine the starches and the hydrocolloids together. So the swollen balls of starch all of a sudden are maintained, suspended by the late that the hydrocolloids have created. And by modulating how much of the balls you are supporting with the lattice, you are changing the mouthfeel. But the science gets better because by modifying the starches or modifying the hydrocolloids, we can actually modify the rate of hydration. We can modify the temperature at which they hydrate we can modify how much the hydrate. We can modify how much they disperse, how much they link and how much they suspend these 2 elements. And that is what the mouthfeel is. So this is, in a way, a graphic representation of mouthfeel, quite simplified, but to give you the idea.

And this is the unique competitive advantage that we now have because our portfolio which now has become quite unique with a significant number of starches and the incredible portfolio that CP Kelco brings into the whole, position us to create incredible combinations, multiple combinations of starches and hydrocolloids for very specific mouthfeel designs. Clearly, quite difficult and time consuming, thinking about all the possible combinations.

And this is one of the many reasons why we have invented and invested in ALFIE. ALFIE is our automated lab for ingredient experimentation and is physically located in Singapore. ALFIE represents a revolution in the food industry. There is nothing like it, and there is nothing that any competitor could do like this. It provides significantly faster and significantly accurate design of mouthfeel, we can develop products at speeds that no one, not even ourselves could do before, more than 10x faster. We can characterize customer solutions in ways that no 1 has been able to do before. And this is done by pioneering use of robotics, machine learning and artificial intelligence. And I would like to invite you to watch this video that describes more about ALFIE.

[Presentation]

Right, as Jim said, this is not only accelerating innovation, but is expanding the innovation and it is along with our portfolio of starches and hydrocolloids and fibers, making us uniquely positioned to address pretty much any mouthfeel challenge. So we have 2 very unique competitive advantages, our portfolio and ALFIE. Ensuring that new and existing ingredients and solutions can be applied very quickly, specifically and accurately is very critical. And for that purpose, we have to be close to our customers.

So technical solutions are global, but taste is local, and we have to be next to the customers to best and most optimally be able to work with them.

To support our customers, we have a global network of 21 customer collaboration centers. Customer collaboration centers are laboratories and pilot plants where our customers come to and work along with our scientists and application specialists to solve, address the problems of optimization, reformulation or innovation and you will notice that there is a significant amount of customer collaboration centers in markets like Asia, Turkey, Middle East and Africa and Latin America. These are our fastest-growing markets. And these are the markets where we also realize that the innovation happens fastest with consumers. And that's why we have purposely located our laboratories there.

So our innovation approach has delivered consistently strong results. Over the last 5 years, our innovation pipeline has added 63 new products. Among them, they still are sold, which is the type of stevia that is highly soluble making it quite easy for our customers to formulate with. We added a significant number of line extensions to parameter our soluble fiber portfolio. And we have also added line extensions to CLARIA, which is the clean label line of starches.

Over the same period, the reported revenue from new products increased by 14% on a compound annual growth rate and as a percentage of Food & Beverage Solutions, revenue increased from 12% to 18%. On a like-for-like basis, new revenue -- new product revenue increased by an average of 26% over the same period of 5 years. Altogether now, with CP Kelco pipeline and Tate & Lyle pipeline, we have a combined pipeline that's worth GBP 430 million projecting into the future. And that is reflecting not only a step-up in our scientific capabilities, but also the much closer collaboration we have with our customers.

So to conclude, I would like to reiterate a couple of messages. Number one, Ingredient Science is crucial for our customers so we can continue developing and delivering new ingredient, innovation and solutions. We invest in partnerships and technologies that help accelerate and bring to life the solutions that are required by our customers today and into the future. Lastly, we have a track record of consistent delivery of innovation and customer solutions.

As I said at the beginning, innovation distinguishes the leaders from the followers and we are a leader. Thank you. And with that, I would like to hand over to Sarah.

Thank you, Victoria. I'm Sarah Kuijlaars, the Chief Financial Officer, and I joined Tate & Lyle last September. My background is in large, global extraction and manufacturing industries. And over the last 9 months, I've enjoyed getting to know the technologies, capabilities and people that differentiate Tate & Lyle from its peers and to better understand the intricacies of the food industry.

During my travels around the group, it's become clear to me that we have the strategy, portfolio and people to deliver on our commitments. Tate & Lyle has truly transformed over the last 7 years. Today, we are a GBP 2.1 billion revenue specialty business, generating over GBP 400 million of EBITDA per annum. We're highly cash generative with free cash flow over the last 5 years exceeding GBP 700 million. We're a well-balanced and resilient business, generating revenue across the globe and across our 3 platforms of sweetening, mouthfeel and fortification.

More than 70% of revenue comes from our 4 core categories of dairy, beverage, soups sauces and dressings and bakery and snacks. As you've heard today, food formulation is complex and science-driven. Our expanded portfolio now provides over 1,000 different ingredients for customers used to make food and drink healthier and tastier. While the food industry is global, taste is local. And that's why, in addition to our local customer innovation and collaboration centers, we operate a regional manufacturing network from which we can serve our customers in their local markets. Our supply chain is diversified, both geographically and across crop inputs. All our key raw materials come from nature, including corn, stevia leaf and citrus peel.

Today, ingredients made from corn are less than 50% of revenue compared from over 85% 5 years ago. The resilience of our regional manufacturing model and agile supply chain means we are very well placed to supply our customers in periods of geopolitical uncertainty. As we previously announced, we started to operate as one combined business on 1st of April. We have moved to a regional operating model, and hence, we will now report on this basis. Our regions are empowered to deliver performance across the entire portfolio. The acceleration of our top line relies on these regions leveraging the combined portfolio day in and day out. Sucralose has delivered consistent margins over a sustained period. Given the increased scale that CP Kelco has brought into the business, Sucralose is now simply one of the many sweeteners in our portfolio and for that reason, has been folded into our regional reporting.

We recognize the importance of providing visibility of CP Kelco's continued margin recovery. So for the near term, we will give supplementary disclosure of the margin progression of CP Kelco's portfolio in aggregate. Given the significant benefits of the combination with CP Kelco, as Nick explained earlier, we continue to expect the enlarged Tate & Lyle to deliver an attractive financial algorithm over the medium term. This means that on average, per year across the cycle, we will grow revenue at the higher end of 4% to 6% per year. Revenue growth will be from a combination of factors, driven by our growing addressable markets, our repositioning of the business to focus on growth trends in the food industry, CP Kelco's continued recovery, revenue synergies from the combination and underlying volume, mix and price.

We will deliver positive operational leverage with EBITDA growth ahead of revenue. We will also benefit in the 2027 financial year from further recovery in CP Kelco's ingredient portfolio and cost synergies delivery, assuming a return to more stable market conditions. This will translate into earnings per share growth ahead of EBITDA. We will continue to focus on cash and strong cash generation with cash conversion of greater than 75% in each year. Our strong balance sheet supports investment in growth with leverage maintained comfortably within the range of 1 to 2.5x net debt to EBITDA.

Moving to CP Kelco integration. I'm pleased to report it continues to go well, reinforcing our confidence in delivering the cost and revenue synergies that we've laid out. We have already taken concrete steps on cost synergies and expect to deliver more than $25 million in run rate savings in this financial year. Let me give you some early examples. Throughout the integration process, we put a real focus on creating a new organization, simple and agile and connect to the best of both businesses. As a result, we have removed duplicated senior roles and delayered the organization. We have closed office space in Atlanta and Dubai and further office rationalization projects are being finalized. We are pursuing a single approach to procurement with early examples, including efficiency opportunities from the cross supply of ingredients, consolidation of raw material purchases, logistics and insurance costs.

Overall, we're making strong progress, and I'm confident we will deliver our total targeted cost synergies of $50 million. The positive engagement we are seeing with customers and our increased customer access around the world gives us confidence that we will deliver our targeted revenue synergies of 10% of CP Kelco's revenue over the medium term. Our focus is on 2 main areas: building cross-selling capabilities and increasing direct service for selected CP Kelco customers. Looking at cross-selling first, using our combined portfolio and capabilities to build broader and deeper relationships with existing customers as well as building relationships with new customers is a key opportunity, particularly given our leadership position in mouthfeel.

I've just returned from Singapore, our regional headquarters in Asia. It was fantastic to see how interactions our team is having with customers and how our investment in ALFIE, which Victoria talked about earlier, is supporting new product development and accelerating our customer speed to market. To support the acceleration of top line growth from our enlarged portfolio, we've implemented a global training program for both our commercial and technical teams. In addition, we have revised our sales incentive teams to directly incentivize cross-selling and have improved our customer relationship management tools. Dedicated technical teams are also actively involved in daily customer-facing engagements.

The second key area of focus for revenue synergies is the migration of certain customer relationships in CP Kelco's business from distribution to a direct service model. Historically, more than half of CP Kelco's revenue is earned through the distribution channel, higher than our own, which is closer to 15%. Our overall approach in bringing these relationships in-house is to concentrate our remaining distribution business with our stronger partners and migrating small accounts to them. We are seeing a positive response from customers to our approach. Our productivity program continues to perform well. As we stated at our full year results a few weeks ago, we have delivered an impressive $91 million of productivity savings over the last 2 years and are well ahead of the run rate required to meet our 5-year target of $150 million savings by 2028.

This program is benefiting from our investments in new digital systems and the use of AI in our plants to improve efficiency and lower costs in areas such as production scheduling and forecasting. Since 2018, we've delivered savings of more than $270 million, demonstrating the strong productivity culture embedded within the business. This program is now active across our expanded operational footprint, and we expect to see further progress in the future. Productivity savings, which are separate from synergy savings are either reinvested in growth or taken to the bottom line.

Turning to the specialty nature of our portfolio. The disciplined management of volume, mix and price and more solution selling together with productivity have been important levers in delivering significant margin expansion. Over the last 5 years, we have grown EBITDA margin to 21% as we transition to the fully focused specialty business we are today. This figure, which compares favorably to our specialty ingredient peers includes CP Kelco's product portfolio for the first time. We remain confident that the margin of CP Kelco's portfolio will continue to strengthen over the medium term. Reflecting the breadth and strength of our portfolio, it's pleasing to see that our specialty margins are consistent across our platforms and categories with each one at or above 20%. The margin in mouthfeel is expected to improve further over time, reflecting the phased recovery of the CP Kelco portfolio.

So what are the drivers of our specialty ingredient margin? I believe there are 4. Our ingredients add high levels of functionality to our customers' products with a key indicator being their low inclusion rates. An inclusion rate is a percentage of the mass of the finished product from an ingredient. The inclusion rates for our portfolio range from 0.1% to around 5%, depending on the ingredient and application. Investment in R&D and innovation is critical to ensure our portfolio remains relevant to our customers. It also creates a consistent pipeline of differentiated ingredients and solutions for which we are rewarded by high margins. As Victoria said earlier, we have invested over $370 million in R&D and solution selling.

Building a patent portfolio is an important part of our scientific strength and helps to protect our specialty ingredient portfolio and know-how. We have nearly 1,000 patents in place and around 300 pending, reflecting our investment in innovation over the last few years. And finally, providing deep ingredient knowledge, applications capability and technical support for our customers is another key part of our specialty offering. We have tripled the size of our applications and technical services team over the last 5 years. Together, the specialty nature of our portfolio, the unique expertise and services we offer enable us to meet the needs of our customers, deliver healthier, tastier and more sustainable food and drink.

Turning to capital allocation. Our approach remains unchanged. Our priority remains a disciplined deployment of capital and to maintain our financial strength. We have a clear prioritization. First, investment in organic growth; secondly, invest in acquisitions, joint ventures and partnerships. Thirdly, our progressive dividend policy with which we have a consistent track record of growing the dividend. And finally, as we have shown over the last 3 years, we will consider returning capital to shareholders where appropriate. We have a strong balance sheet, giving us flexibility to invest in growth. Looking forward, we want to retain the flexibility to use this balance sheet to drive value-accretive growth and to maintain long-term efficient leverage in the range of 1 to 2.5x net debt to EBITDA. At 31 March, leverage was 2.2x. And within the next 2 years, we intend to deleverage towards the midpoint of this long-term range.

Capital expenditure for the current 2026 financial year is expected to be in the range of GBP 120 million to GBP 140 million. Looking further ahead, we expect CapEx intensity between 6% and 7% of revenue in the 2027, 2028 financial years, consistent with recent investment levels in Tate & Lyle. Our capital spend in this period will continue to be focused in 3 areas: growth, sustaining and productivity. We expect investments in growth CapEx to be around 30% to 40% of total expenditure. Growth projects are expected to achieve at least an internal rate of return of 20%, well above our return on capital employed. Sustaining investments, which include maintenance and sustainability are expected to be about 50% to 60% of total spending in each year. Productivity investments, while the smallest part of our total spend, remain important and are expected to be between 5% and 15% of total spend. The transformed Tate & Lyle has the strategy, portfolio and people to accelerate top line growth. We are focused on delivering the benefits of the CP Kelco combination, our synergy commitments and maintaining financial discipline to deliver an attractive value proposition as a growth-focused business and attractive shareholder returns.

With that, let me hand you back to Nick.

Thank you, Sarah, and indeed to all of our presenters from this afternoon. I hope from this afternoon, you can see that the new Tate & Lyle really is a growth-focused specialty Food & Beverage solutions business, a global leader in food and drink reformulation.

We see significant growth opportunities ahead as a result of that, which give us real confidence in our ability to grow ahead of the overall market, the 4% to 6% range we talked about in our financial framework. As I said earlier, the food industry really is at an inflection point. To meet the health and dietary challenges that the world is facing a significant proportion, as Clare demonstrated today, of the day-to-day food and drink we consume will need to be reformulated. With the portfolio and capabilities we showed you today, we really are uniquely placed to benefit from this growth opportunity. And that's the basis for how we believe we can grow ahead of the market, augmented by the significant benefits from the CP Kelco combination.

So the new Tate & Lyle really has been repositioned to be at the center of the future of food. We're focused on creating solutions that meet growing consumer demand for healthier, tastier and more sustainable food and drink. We're operating in exciting segments of the market, and our focus now is on accelerating top line growth around the world. I want to leave you with where I started, which is the 4 key messages I started with today. Firstly, our structural transformation into a specialty business is complete following the combination with CP Kelco.

Secondly, we have leading positions across sweetening, mouthfeel and fortification. And as a result, we really are well placed to meet the growing global demand for healthier, more nutritious food and drink. Thirdly, because of our unique portfolio and enhanced capabilities, we've significantly increased our ability to be that partner of choice for our customers, and we intend to do that around the world. And I think you can see we have a clear strategy for accelerating growth and importantly, delivering attractive shareholder returns. Together with CP Kelco, we are a business that really is fueled by science, is obsessed with customer collaboration and has a strong desire to make a positive impact on the world as we grow. Science Solutions society. That is our commitment to ourselves and all our stakeholders. And I hope you saw that commitment in the passion, belief and the energy of the people and the team today.

So with that, that's the end of our presentation. We'll obviously regroup in Skensved on Thursday as well with some of you. But in the meantime, I'd like to invite Sarah, Didier and Bill to join me on the stage to answer any questions you might have. We're just going to take a short break while we set the stage up. So please bear with us for a couple of minutes, and thank you.

Okay. To ask a question in a normal fashion, please. If you're in the room, put your hand up, a roving mic will find you and give your name and your institution at the beginning of your question. If you're watching online and you'd like to submit a question, please use the box at the bottom left-hand corner of the screen. And I will read your question out for you.

Chris Pitcher from Rothschild & Co. Redburn. Nick and the team, thank you for a really comprehensive overview of the capabilities and the infrastructure you've put in place to sort of become a solutions selling business. The one thing versus the Capital Markets Day in 2023 that maybe wasn't there was the -- how much of your business is solutions today? And what are the aspirations for the future? And following on from that, what do you think perhaps have been some of the challenges in selling solutions rather than just ingredients, which Veronica in her presentation highlighted the significant benefits of moving towards solutions?

Thanks, Chris. And I'm glad you gave me a name because you can't actually see anybody because of the lights anyway. So look, our aspiration to increase the mix of solutions in the business is undimmed. And I'll maybe ask Bill to talk a bit about the pipeline we're seeing coming through in a minute. As we put the businesses together, we're still working through precisely how we reset the base and build a new target. So I wouldn't take a lack of detailed disclosure at this point as a lack of belief in the importance of the future of solutions as part of the mix. We just need to work through some of the details, and we'll continue to report on that over time when we've sort of cleaned up the 2 businesses and put them together. We're still very early in doing all of that.

In terms of your second question about challenges, if I go back 7 years, 7, 8 years, we had to completely reengineer our whole commercial front end. It wasn't that we didn't have the science or we didn't have an expanded portfolio that we were building. We needed to build the customer-facing capability to face into them in a different way. Selling a solution requires a very different organization, a very different capability and a very different relationship with your customers. You heard Veronica talk about that a bit earlier. And those things are still building. Those were all real challenges if I go back to where we started this journey.

As we bring the 2 businesses together, we're sharing the learnings from those challenges and those shared journeys. And we are night and day better at it today than we were previously. On top of that, we needed to build that capability globally. So you saw the chart with all of the application labs around the world, 70% of those being in faster-growing markets. 7 years ago, that coverage was significantly lower. So we've had to completely reengineer our commercial organization. And it's -- I think about it as a sort of 3-legged stool. You've got your sales organization, which is managing the customer relationship. You've got your category teams who are really working with the platform teams to develop the capability and the ammunition to take to customers.

So if you like, the push of what we do versus the pull from them. And then is this critical leg of that 3-legged stool, which is your applications and technical capability, the people who really work with the customers on formulation in our labs, utilizing world-class technology like healthy.

So Bill, maybe just add on the solutions side a little bit on what we're seeing in terms of the development of the pipeline as we put the 2 businesses together?

Yes. Thanks, Nick. I think as Nick said, we need to rebaseline the metrics as we bring the organizations together. But we do know even before the combination that we were increasing the delivery of wins that were solutions driven in the legacy Tate & Lyle business. And much of what you heard talk about today, this combinatorial knowledge and bringing starch and hydrocolloids together and deploying it to customers, most of that is going to be a solutions approach with customers. So as we see that pipeline develop, we are seeing an acceleration of the pipeline that is of a solutions nature. And I would expect that we'll, once we rebaseline metrics, see an acceleration as a result of the combination.

We should take one more from the room, and then I have an online one.

It's Alex Sloane from Barclays. I'd echo the thanks for the granular presentations today. I've got a few questions, if that's okay. I mean the first one, it's good to hear the confidence on the margin rebuild in CP Kelco. I think in the past, you've talked about getting back to a sort of 20% plus EBITDA margin before synergies. So I'd love to hear from you, Didier, in terms of where you see the kind of key opportunities for that recovery.

Second one on reformulation. I mean we're seeing a lot of U.S. food customers right now pledging to take out artificial colors from their food products. I appreciate you don't sell artificial colors or natural colors. But how do you ensure -- I mean, a lot of the products that you sell into will have colors in them. So how do you ensure that tape wins its fair share of that reformulation? Can you put in some of those colors into the ALFIE machine, which you showed us, which look very cool.

And then one final one, just very brief clarification just for Sarah. I think when you were presenting the financial algorithm, I might have heard it wrong, but I think you caveated that it was assuming a return to kind of more stabilized operating conditions. Is that just referring to the kind of the tariff stuff that you outlined in May not escalating? Or is there something that you're assuming in terms of end markets that need to improve to achieve that algorithm?

So Didier, why don't you talk about the margin recovery in Kelco.

Margin recovery pre-synergies, I would say 3 -- think about it in about 3 buckets. One is we're recovering from turbulent times with COVID, consumer changes, war in Ukraine, which impacted our pectin business. And following destocking, following higher energy prices, we ended up having high inventory levels and higher cost on pectin. We see that normalizing. We have redeployed our business. You saw the balance we have across regions. So the volume is back. The costs are down. Energy is normalizing. So we see volume leverage going down the P&L and the margins.

The second bucket will be all the investments I talked about. A big share of it is going into improving our [ BioGems assets ], so the biofermentation assets and in particular, adding capacity so that we can sell more, but also adding lower cost capacity so that we've got better competitiveness, but also higher margins.

We are commissioning those assets as we speak. Customers are approving the products that we made and demonstrating the capability to do it. When this flows through, we will have a margin recovery. And the third one is the mix impact. Everything we talked about, about selling more differentiated products, selling more solutions, they will be at a higher margin. So that will serve okay.

o Alex, your second question about artificial colors, natural colors in the U.S. I think it's a specific example of a more general focus on improving the nutritional content of processed food. Clare, I thought presented it very elegantly today. And we're at the core of that because of the impact of reformulation has on mouthfeel, not just sweetness, et cetera, and the core, therefore, of being part of the reformulation solution that still makes it acceptable and consumer preferred. So the way to do that is to be demonstrate that we're the best at helping with our customers. I mean -- but it is a reinforcement of the points we were making today about this idea of the food industry is reaching an inflection point.

I mean look what happened at the weekend. The government retailers and U.K. food manufacturers announced the forming of a soft coalition to solve the $11 billion cost of obesity to national health, precisely through doing some of the things we can help with. So we're starting to see some of these regulatory focus areas impact food manufacturers' willingness to reformulate and therefore, create a great platform for us to build the right relationships.

And I think the last question was for you, Sarah, wasn't it?

Thank you. So indeed, so I think it's -- based on what we -- based on what we know today, we are confident that we are targeting the revenue growth and the leverage going down to EBITDA in EPS. And you mentioned tariffs. We gave more detail about tariffs back in May, and you recall that the main axis is U.S. and China. And let's see what happens in the next week and beyond. But I think we've got to acknowledge there's a broader macro uncertainty that we all have to navigate, and we are confident that we're going to navigate. But given that macro uncertainty and the geopolitical uncertainty out there, I think it's only fair to caveat based on where we're not today, this is what we're targeting.

Okay. I have an online question from the line of Joan Lim at BNP Paribas Exane.

Where do you see normal EBITDA margins for mouthfeel? Will it be above the levels of the other 2 platforms?

So I'll give you a simple response to that. We currently believe that we're going to see an improvement in mouthfeel margins. And that's based on some of the things Didier just talked about because when you look at the mouthfeel portfolio, it's broadly 2/3 hydrocolloids. So naturally, the recovery path of ex-CPK products that we announced when we put the transaction together will enhance mouthfeel margins.

I think over time, we will see how margins settle down across the 3 platforms. And increasingly, I think there's probably going to be a blurring across them as well as we look to formulate increasingly across the 3 platforms, but we're absolutely expecting to see Mouthfeel margins improve over the next few years.

Okay. There's a follow-up from Joan, Joan Lim at BNP Paribas Exane. What do you see as the right level of R&D spend for the new company?

I mean R&D spend is often measured in very different ways companies by companies. I think much more about how much pressure we're putting into customer-facing capability, including R&D. So end-to-end R&D, the investment we're making in our commercial application and technical capability. And we feel very well invested today to deliver on the growth opportunities we see ahead.

Frankly, I'm not sure what the right number is. It will evolve over time as the business develops. But what we won't do is stop investing in it because it's a critical component of fueling top line growth. The investment we made in ALFIE, by the way, was 10 years in its genesis from the initial germ to the final solution. So this is also a long-term game. It's not just for today. ALFIE will only starting to deliver benefits 10 years after we conceived it in the first place. But it gives us a really powerful weapon today. So we're going to have to think about investing in our R&D for the future. And our thinking on that will inevitably evolve. But we know we're well invested today. We're especially well invested in terms of customer-facing capabilities in each of our key growth markets, and that's one of the benefits we now have to accelerate growth.

So we've got from the floor. Karel?

It's Karel Zoete with Kepler Cheuvreux. I've got 2 questions. The first one is on growth. You highlight the business has grown around 5% a year, but we've got quite some volatility between the years. At the same time, we got some data on the growth from new products. And the thing I'm curious at is, can you highlight some things that have worked really well for you in terms of growth along the 3 platforms, so mouthfeel, fiber, sweeteners and things that haven't done because that always remains a bit difficult. You have so many products to sell, sometimes combination, sometimes not. But what has been successful and whatnot and for what reason?

And then the second question is more precise maybe. It's about the pectin market. You have a big position, upgraded some facilities, et cetera. But what does the market look like in terms of competitive space? How has CP Kelco fared against its competitive set? How is it differentiated versus competition?

I think I know where the second question is going. But let me answer the first one. So look, I mean, through all of that volatility that we've seen in the last 5 or 6 years, the good news is we've seen very consistent revenue and EBITDA progression through that period. And that talks to the resilience of the business, very much helped by the successful growth of new products.

Now the nice thing about the new products environment is it's not kind of one big rifle shot. It's quite distributed across the 3 platforms. So we've successfully grown our sweetener platform with Stevia being a core part of that. We've successfully grown in the old Tate & Lyle business, our clean label starches. That's been a big driver. And then on the fortification platform, we've seen really good growth from fiber. I believe we're only just starting there, by the way, because of some of the deficit numbers that Clare talked about earlier. Have we had some challenges along the way. Of course, we have because you're not going to get every single new product right. I've been a bit disappointed by the pace of growth of allulose. That hasn't been helped by regulatory challenges either though in terms of approvals around the world. So I think the key is -- and this is the point we sort of try to make consistently, which is it's the breadth and depth of the 3 platforms that really matters ultimately because then you can build multiple vehicles for growth rather than one rifle shot. And I think we did it would say, look, only being in hydrocolloids was a real constraint on growth, which is why when we started to talk about bringing the 2 businesses together, we were both very, very excited about the potential. But I'm not going to talk about the pectin market. I'm going to get the expert do that.

So the way I will look at the questions is 2 sides of it. One is the pectin franchise, and is it growing and where? And the second one is how are we positioned as CP Kelco to win in this market. First one is pectin, other than a blip on the -- during the COVID time, particularly driven by soft demand in Asia when everyone was at home, pectin franchise has been growing continuously. It's been growing fueled by dairy products, has been growing fueled by nutrition, by the need to have gummies that used to be androgens, but now it's a way to deliver nutrition. And we see the volume growing nicely in different segments. I would think about the pectin not only as one product, but you have to think about it as a portfolio of solutions. They are different products, different fruits that you understand or peel that we can use, different technology we're using to deliver very different functionalities from jetting, thin forming, stabilizing proteins, gut health, those are very different products. They all call pectin, but they're very, very different. And some are growing faster than others.

Everything that has to do with nutrition, with delivering nutrition, with stabilizing proteins, you understood that high protein diets are on the rise. All that is growing faster than what could be high sugar products. So if you take a regular jam, this is growing slowly or contracting sometimes. If you take a low sugar jam, that's a different pectin, but this has a different growth rate. So all in all, depending on the categories, the pectin franchise is growing, and that's driven by the fact that it has a very, very clean image.

Nick talked about clean label. When you ask customer panels what ingredients they prefer, pectin is top of the list all the time because this is the ingredient that grandma used to have at home to make jams essentially. And that has a very, very natural image, very consumer friendly. So it is growing and it's seen as one of the really star products in the hydrocolloid industry. Now we are the larger one. We have an industry-leading position. We've got a higher share than 1/3 of the business. And we are well positioned to keep it. Why is that? As I was saying, peel is a critical raw material. We are the only company integrated into peel in Brazil because we are integrated in the supply chain when we ship the fresh peel to our plant and extract the pectin. That's a huge cost advantage. You don't have to dry it. It doesn't deteriorate. So you have better pin at the end of it, and you don't have to ship the peel.

But for our plants in Europe, we're also making the dry peel for our needs. Therefore, it is better quality. We're using a patented technology, and we make better pectin at the end. So the raw material is a critical source of advantage, competitive advantage, and we are the only one enjoying that. When you look at the scale, we got 2 of the largest plants in the world. Same thing. Think about it about portfolio. I don't know if you will go to Skensved in Denmark with us, but you will see a very large plant, the larger plants doing LM pectin, scale matters for that manufacturing. While in Brazil, you will have the largest plant, the lowest cost plant in the world doing HM pectin.

So very well positioned, very well positioned to weather any changes in raw material supplies because we are integrated into it, because we are leveraging our presence in Brazil and oranges are cheaper than lime, which are cheaper than lemon. So we are also enjoying the low-cost raw material. So we place -- we have a dedicated team doing only raw material sourcing. We have a technology team looking at how to optimize those fruits in different types of fruits. And there we have an application team looking at how to optimize the pectin molecules in specific applications. When you combine all that, then it's the market leader, and those are capabilities that are very, very difficult to acquire.

Thanks for the presentation. I'm Michael Rapps from Converium Capital. I wanted to ask you a bit about margins again. So there was a slide up there that showed margins by geography, and they're far different if you go Asia, Europe, U.S., which is maybe inconsistent with the stability of the margins across mouthfeel, fortification, et cetera. So my question is, do you expect the margin profile shown by geography to stay the same? And if not, how do you -- what causes it to evolve and improve?

Sarah?

Thank you, Nick. Yes, thanks for the question. I think as you're right, there's a variety across the regions. Maybe we take the Americas first, which has got the highest margin. That's supported by a significant portion of the sucralose portfolio, which we talked back in May has got 31%. So that's a real boost. And also the Americas is the larger. So obviously, you've got some benefit from scale there. And Europe is obviously impacted by Middle East and then Asia, of course, is the growing margin. And there, we're actively investing to grow the top line, given we've got -- particularly in Asia, we've got access to half the world's population spread from India to Japan down to New Zealand. And so the focus there really is supporting Remington to grow the business. And with growth, we believe that the margin will improve. And then I think linked to that is as CP Kelco continues to improve their margin, CP Kelco is very well placed in Asia. So that will also support the continued margin recovery in Asia Pacific.

Damian McNeela from Deutsche Numis. My question is, is the revenue guidance ambitious enough. And the reason I ask that is that 2 years ago, the guide was 4% to 6%. You've delivered 5% over the last sort of 5 years. Since then, we've had a transformational acquisition in CP Kelco. We see the emergence of sort of anti-obesity medicine come through, and we've still got the sort of sugar reduction opportunity. So what are the things that we should be thinking about in terms of Tate's ability to really drive revenue growth from here?

It's the first time I've been asked a question like that, Damian. So I mean, look, I think we've been very clear about what our commitment is over the next 3 to 5 years to get to the higher end of the 4% to 6%. That requires us to grow ahead of the market. We're very confident in that. I think would we love to do more? Of course, we would. What would that look like? It would look like us doing what we're doing today really well as we put the 2 companies together and also a significant shift in our view on the pace of reformulation because I think it's going to grow over time.

So we've talked about it in many different ways, questions about regulation. If that really kicks in, then I think we could see growth ahead of what we've stated in our medium-term financial growth algorithm. And of course, we will look to do more always. But it will require that potential for reformulation to really accelerate. We know all the trends are there. But in the recent market environment, things have slowed down as we've dealt with all of these macro shocks, et cetera. So yes, are we confident in what we said? Yes. Do we think we could do more? Absolutely, if things play out the way we hope they will.

So I think there's one right at the back, Lucy.

Andrew Ford from Peel Hunt. It was really informative and engaging. I'm fairly new to the story. So forgive my ignorance. My first question follows, I think, Alex's the macro trends in the sector have persisted for quite a long time. The growth in health and wellness, I guess, could manifest in a number of ways and reformulation is obviously one, but there could also be a reversal in the technification of food possibly. I know Clare sort of alluded to that and mentioned not all reformulations are the same, but I just wondered about the balance of the portfolio of highly artificial and nonfunctional relative to the more sort of natural and added functionality, sort of how -- or if I'm looking at it the wrong way, if that's the wrong way to look at the portfolio.

No. I mean I don't think -- it's a way to look at the portfolio. So I mean we're very clear that we want to make nature-based solutions using science to continue to allow our customers to reformulate to provide more natural, cleaner label, et cetera. We also have in our portfolio a very valuable franchise in sucralose, which is an artificial sweetener and very well regulated, absolutely food safe and provides great taste and is an important part of the portfolio. But the vast majority of what we do comes from nature and is reformulated in a way that allows that to flow through to customers. There are some nuances in that because what's natural versus not depends on market by market, but we believe the portfolio is well positioned for those trends.

I guess it's difficult to put a percentage on it is what you're saying, but it'd be interesting to know either the sort of headline numbers or relative to new product development, if that's changing at all.

I mean if you simply just strip sucralose out from the revenue, sucralose is a teens part of the revenue now, isn't it? So I hate to use the 80-20 rule because it's always very dangerous, but a high proportion of the portfolio does label in a very clean way for consumers and customers.

And next question, just on R&D, that's sort of a really impressive number. And I just wondered how that changes in a world of more direct customer relationships that you also mentioned in the presentation. Is it -- are costs going to be shared more? Is there going to be more exclusive arrangements or any other, I guess, change in focus from a group level?

Look, I mean, I think fundamentally, more direct customer relationships are very valuable because it allows you to build some -- build some of those characteristics that Veronica talked about earlier. I don't think it fundamentally changes how we think about investing in R&D and in customer-facing capability. Somebody asked a question about margin structure by region. One of the reasons that in Asia, our margin structure is a bit lower is we put a lot of commercial cost into Asia to accelerate growth. 5 to 7 years ago, we had $100 million business there. We've got a $500 million business. We've got the capability there to grow to be much bigger because we've invested in physical infrastructure, in labs, in ALFIE, in people capability. So we have a great base to grow off.

So I don't think more direct customer access means significantly added cost. What it will mean is our ability to increasingly help them reformulate and it should accelerate, therefore, the solutions part of our business, which we know is more valuable, stickier and builds better relationships.

So we've got a couple at the front here.

It's Tom Horsey from Wellington. Just on the GBP 3 billion opportunity to take sugar loses market share, is that assuming sugar goes from 80% to 0 or 80% to 50% or something similar? And then if you look at the opportunity for pectin to take share from gelatin, I guess it's vegan and it's probably lower carbon. Has anyone scaled that kind of opportunity in terms of dollars?

So again, I think is pectin is for you. So on sugar, if you remember, we said roughly 80% of the world's sweetening today is sugar. The non sweet -- the nonsugar market is about $6 billion, right? So logically, therefore, you can figure out roughly what the portion. So we're not talking about sugar going to 0. We're talking about taking percentages off when you look at it. So $3 billion will be roughly 10%, if I get my math right.

On the substitution, I would think I'd love to replace gelatin with pectin, but the beauty of it is that we have a portfolio. So we win with Carrageenans, we win with starches, we win with gellan gum or pectin in replacing gelatin. I mean I think Veronica said, gelatin is hard to replace for texture, for stability, for processes. And sometimes we have to take pectin, sometimes we need to take another product.

At the moment, we see a lot of growth for what we call gummies because producers want them to be vegan. And therefore, they want to reformulate so that the main product is vegan and not using gelatin or they want them to be stable and gelatin as today will melt if they are in a truck on the road. So they want to be stable for normal distribution and supply chain, and they want them to be again. We see a lot of wins with that. In our portfolio, it will be either starches or pectin. And we had a lot of growth in pectin. Part of what I was saying in the volume rebound and the volume leverage is coming from this reformulation.

What the next one would be, it might be in desserts, it might be in soft capsules for nutrition. We're still using a lot of the gelatin. And then it will open up new opportunities and new systems for us.

Patrick Higgins from Goodbody. My first question is just around, I guess, commodity kind of supply chain shocks. And I know, Didier, you mentioned in terms of pectin, how your integrated models kind of gives you competitive advantage to manage that. But more generally, there is obviously supply chain shocks around cocoa, citrus, a [ host ] of commodities. How big of a driver for reformulation is that for your portfolio? And I guess, how is your portfolio set up to play into that trend?

My second question is just around the ALFIE system, fascinating video. How much of your pipeline is being generated through that, I guess, robotics today? And what's to stop you scaling that kind of across more geographies and into sweeteners or fibers, et cetera?

So let me take ALFIE first. We opened ALFIE in October last year. So we've been at it for 6 to 9 months. And it started with really characterizing ingredients so that we could formulate better. What we're now starting to see is significant customer interest and interaction with ALFIE, notably in Asia because obviously, it's sitting in Singapore. And we're starting to hold some pretty big sessions with customers on generating a pipeline as a result. They're fascinated by the ability to speed things up and to use the combination of AI that Victoria talked about to get to a more, if you like, a more accurate virtual sample. And then when you put it into ALFIE, it runs 10x plus faster than doing a lab sample.

So the acceleration is almost off the charts. We'll start to see it develop a stronger pipeline over the next few months, I suspect, as customers really start to interact with it really. And we're starting to see some prototypes come off it now, but we're only 6 to 9 months in, but encouraging so far. On commodities, I would say commodity shocks, less of a driver of reformulation, but more a driver for us to create resilience. So I'll give you a couple of examples. So stevia, very concentrated supply out of China. Climate shock in China on stevia, a big problem.

So hence, the all North America -- all American supply chain we've created in partnership with Manus so that we've got stevia sourced, stevia out of Latin America with U.S. manufacturing. So creating alternative supply options, which, by the way, help with geopolitics as well. Think about corn and a need to create a more resilient supply chain for corn because some of the crops challenges we've seen. So 3 years, 3 crop seasons ago, massive drought in France, corn yields went down 30%. We had to import non-GMO corn from the U.S. to serve our Europe business. That required regulatory approval in Holland to allow the non-GM corn to come in.

So working on regenerative sustainable agriculture practices around the world is really, really important as well. So as Sarah talked about a more resilient supply chain, that's resilience both from the field and to where the manufacturing locations are. I think we'll see more diversification of raw material supply and also more local production over time as you see the world evolve.

On citrus, by the way, we're actually a relatively low user of the overall total crop in Brazil. And because we're using effectively the waste stream, which is the peel, that's less of a concern for us. And because we've got such backward integrated relationships with some of the orange growers, we're pretty well established.

I want to add one point because those are the raw materials and the crops we're depending on for our manufacturing processes. But you mentioned cocoa, that's opportunities for us because Bill and his team will go to customers and offer ways to actually cut down 20% of their usage by having solutions and building back the mouthfeel, the taste, the flavor profile so that they can decrease on that being neutral for customers. So those disruptions in the market are also great opportunities for us to bring solutions.

So I think we've got time for one last one. I see one there.

Chris Pitcher from Rothschild & Co. Redburn again.

It's 3 years almost today since you bought Quantum and [ dietary fibers ] hasn't maybe become what you've hoped yet. If you talk a little bit on how that integration has gone, how the revenue synergies for their technologies have progressed? Is it still very much a Chinese business? Or -- and what learnings from that can you apply to the CPK synergy attempts?

I mean if you remember, when we first announced the Quantum transaction, it was very much a China for China logic. FOS and GOS for the Chinese market, they were the leader. However, there is a big potential export opportunity as we've established that business as part of Tate & Lyle. So I say, look, the integration has gone very well. Some of the learnings from that integration, we did port across into the CP Kelco integration program, although it's a much bigger scale and global and therefore, required a lot more different thinking.

I think FOS and GOS will become more important for us outside China over time because of the accelerated interest in fiber and because FOS and GOS bring different functionalities to our core fiber. So they give us another weapon. So I expect to see it as an important growth vector for us going forward.

Thank you. I'm being given the hook by Chris. Look, thank you all for spending so much time with us this afternoon. It was the first part of our Capital Markets event. The second part is in Denmark on Thursday. We're excited in showing you the biggest pectin plant in Europe and really learning more about the functionality and versatility of pectin.

I hope you can see from the presentations today a fundamentally different business to the one I joined 10 to 11 years ago and a business that really is well positioned to accelerate growth in a world where food is evolving very rapidly. We passionately believe that. And I hope today gave you a much better idea of what the new business really is.

For those of you online, thank you for joining us for the whole of the session. Sorry, you couldn't be with us. For those of you in the room, we're very happy for you to join us for a drink upstairs, and we can continue the conversation if you would like. And we look forward to seeing at least some of you in Denmark on Thursday. Thank you very much.