LONDON (ShareCast) - Ingredients maker Treatt briefly hit a 52-week high following bumper interim results before the bears, seizing on the board's forecast that second half results may not match the first half, drove the shares lower.
Profit before tax in the six months to the end of March surged to £3.72m from £1.49m the year before, on sales that jumped to £35.80m from £27.72m.
The interim dividend has been hiked to 4.8p from 4.1p the year before. The board aims to recommend interim dividends that are about half the value of the intended final dividend.
All three of the group's operating companies performed well during the period, with the high orange oil price, which quadrupled in less than a year to hit an all-time high of around $8 per kilogramme, being a significant contributory factor towards the bumper numbers.
Treatt USA has continued the strong growth it showed last year into the first half of this year and has become a significant contributor to the group's results, while RC Treatt's global business, based in the UK and exporting to almost 100 countries, has maintained its steady growth.
Earthoil, the group's organic and fair trade business, doubled sales (in volume as well as value) and the business made a positive contribution overall in the first six months of the year.
The group's third quarter has started well, with the order books remaining strong across the whole group, but the company will have to go some to match the first half performance.
"The board believes that although results in the second half of the year may not be as strong as those in the first half, full year results remain on course to meet its revised expectations. However, there is always the possibility that some raw material prices may have peaked, in particular orange oil, and that there may therefore be some impact on margins if prices begin to fall," said James Grace, chairman of Treatt.
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