Treatt reported its financial results for the year ended 30 September 2025, describing a challenging period marked by sustained high citrus raw material costs and softer consumer demand in parts of North America.
Revenue was GBP 132.5 million, an 11.8% decrease from the prior year. Management stated the decline was largely volume-driven, with high citrus prices leading to fewer product launches, delays in reformulation work, and some short-term substitution that particularly affected its heritage citrus portfolio.
Gross margin was 25.9%, down 340 basis points year over year. Profit before tax and exceptional items was GBP 10.3 million. The company declared a dividend of 5.6 pence per share.
Interim Group Managing Director and CFO Manpreet Randhawa, who joined the company just under six months ago, said the group's performance landed in line with revised expectations shared in July. Group Finance Director Kelly Gordon added that the decline in performance was primarily driven by changes in customer buying patterns amid high citrus prices and weaker premium demand in the U.S., rather than any erosion in customer relevance.
Management described two major headwinds: sustained high citrus prices affecting customer purchasing patterns and competitive dynamics, and softer North American consumer confidence pressuring premium sales.
In the heritage category, sales declined 11%, described as volume-led. Gordon cited volume reductions in one strategic account. Premium sales fell 13%, led by slower U.S. consumer demand amid macro uncertainty. The new category declined as citrus headwinds affected China, while coffee remained "nascent" with low volumes.
In response to the tougher trading environment, Treatt implemented "self-help" measures. Gordon said the company reduced its cost base by over GBP 1 million, with total cost savings of GBP 1.4 million for the year driven by enhanced cost controls and reduced discretionary spending.
Management described the balance sheet as "very healthy." While net debt increased, Treatt returned GBP 10 million to shareholders through dividends and a GBP 5 million share buyback completed during the year.
Randhawa said Treatt's strategy remains unchanged and is built around three pillars: building on heritage, accelerating premium growth, and expanding new capabilities.
The company highlighted several execution milestones. Its Shanghai Commercial and Innovation Center opened shortly after year-end, with management citing strong customer engagement. Treatt signed a Southeast Asia distribution agreement with IMCD. The company expanded sales presence in Germany and France via recruitment of industry experts. It also launched more price-stable citrus products to protect volumes and customer relationships amid volatility.
Randhawa highlighted innovation efforts including powdered citrus extracts scheduled to launch in the first half of 2026. He said Treatt entered the U.K. sports nutrition market with the powdered citrus range, noting early customer feedback was "very positive indeed." In premium, management said it refreshed the Treatt brand, expanded digital access to the portfolio, and launched clean label and sugar reduction technologies. Randhawa said the group added 136 new customers during the year.
Exceptional costs were GBP 3.3 million, higher than the prior year, primarily related to the potential transaction process during the year. Gordon noted that FY24 figures were restated following an auditor-raised adjustment related to revenue recognition.
In September, the board recommended a cash offer from Natara Global, but the offer did not receive the required level of shareholder support. Management said the process reinforced the underlying value of Treatt's assets and market position.
Treatt also discussed the arrival of Döhler as a shareholder, owning 28% of the business. Management said a formal relationship agreement announced alongside the results is intended to ensure dealings are conducted on an arm's-length basis. The board is recommending the appointment of a non-independent non-executive director, Helga, who management said brings sector experience from roles at IFF and Givaudan.
Looking ahead, Gordon said Treatt is targeting a return to revenue growth in FY26, underpinned by citrus volume recovery, China returning to growth, and conversion of its pipeline. The company expects gross margin to be stable as the citrus backdrop changes. Management also expects normalized capital expenditure and a return to net cash, adding that first-quarter performance was in line with expectations.
While the company expects industry headwinds to continue into FY26, Randhawa said Treatt is entering the year more resilient, with an emphasis on disciplined execution, pipeline conversion, and protecting profitability and cash generation.