Treatt (TET) H2 2024 earnings summary

Executive summary

• Delivered record sales of £153.1 million in 2024, with strong second-half momentum and double-digit profit growth year-over-year.

• Heritage segment (citrus, synthetic aroma) drove growth, while premium segment saw modest gains and new markets were mixed, with China showing strong growth.

• Strategic focus is shifting toward premium categories, aiming to flip the business mix from two-thirds heritage to two-thirds premium over time.

• Expansion into Asia, especially China, and investment in innovation centers and pilot equipment to accelerate premium product development.

• New management team and structure in place, with available capacity in Europe and USA.

Financial highlights

• Revenue grew 6% in constant currency, reaching £153.1m, with record H2 revenue and profit.

• Adjusted EBITDA increased to £24.9m, and adjusted operating profit rose to £19.9m; net margin rose to 13%.

• Gross margin for the year was 29.1%, with H2 margins exceeding 30%.

• Admin expenses reduced by 7% despite inflation, supporting record profitability.

• Proposed total dividend up 5% to 8.41p per share, with a final dividend of 5.81p.

Outlook and guidance

• 2025 sales expected to grow 5–7%, with gross margin guidance of 28–30% and net cash position of £3–5 million.

• Medium-term targets: net operating margin at 15%, ROCE/ROACE between 15–20%.

• Focus on expanding reach into new geographies and high-value markets, with operational efficiencies and innovation capex.