TATE & LYLE has warned that its sales of more than £3bn will be hit by planned reforms to the EU’s sugar regime.

The news overshadowed some sweet full year financial figures released on Thurs, June 3, pegging the company’s share price back 5% to 461p.

Turnover was up 5.5% to £3.34bn in the year ending March 31 and pre-tax profit climbed more than 12% to £255m.

It cited the strong performance of its sucralose brand Splenda alongside an increase in value-added sales, which boosted American profits 27% to £161m.

Splenda alone accounted for £47m of that figure.

Nonetheless, its European sweeteners business, with sugar operations in the UK, Portugal, Slovakia, Hungary and the Czech Republic, saw profits fall £3m to £108m on sales of £1.45bn.

Tate & Lyle blamed higher input costs as well as the weaker dollar and more costly export licences.

And the company is nervously eyeing the EU commission, which is due to bring forth far-reaching reforms of the bloc’s sugar regime on June 22.

Chief executive Iain Ferguson has warned that any reduction in domestic prices, a key part of the proposed reform which could see cuts of up to 39%, will squeeze producers’ and refiners’ margins.

“We rely on the European Commission to ensure that proposals are advanced which do not prejudice the ability of our operations to compete to their full capability in that evolving market place.

“The potential of the reform to impact on the total Group results is reduced by the successful implementation of our strategy to grow the value added component of our business, a consistent objective since 1999.”