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Tate & Lyle
Tate & Lyle delivered a sound set of results underpinned by continuing grwoth from core value added food ingredients. Iain Ferguson CBE

Key performance indicators

Tate & Lyle’s Board and executive management monitor a range of financial and non-financial performance indicators, reported on a periodic basis, to measure the Group’s performance over time. Annual targets are set for base key performance indicators (KPIs) in line with the Company’s strategic objectives.

Interest cover1

Targetmin 5.0 times
2009 6.1 times
2008 7.8 times
2007 8.4 times

1 Measured by financial year on total operations

Description. This is the Group’s total operating profit before exceptional items and amortisation divided by net finance expense, as defined in our bank covenants. Or, the number of times the profit of the Group exceeds interest payments made to service its debt.

Comment. Our interest cover remains above our target.

Net debt to EBITDA multiple1

Targetmax 2.5 times
2009 2.4 times
2008 2.5 times
2007 1.9 times

1 Measured by financial year on continuing operations and translating net debt at the same average exchange rates as EBITDA

Description. This is the number of times the Group’s net borrowing exceeds its trading cash flow. EBITDA is earnings before exceptional items, interest, tax, depreciation and total amortisation.

Comment. We are within our target and comfortably within that of our bank covenants.

Return on net operating assets1

Target (longer-term)20.0%
2009 12.7%
2008 15.5%
2007 18.9%

1 Measured by financial year on total operations

Description. This is the Group’s total profit before interest, tax and exceptional items divided by the average net operating assets.

Comment. We are below both our initial target of a Group return on net operating assets (RONOA) of 15%, and our longer-term target of a RONOA of 20%.

Energy use1

Target3.0% reduction
2008 zero
2007 1.3% reduction
2006 1.2% reduction

1 Measured by calendar year

Description. Energy use is our most significant environmental impact. Our businesses have a target to reduce energy consumption on a per unit basis by 3% each year.

Comment. Our 3% target is becoming increasingly challenging as value added products typically use more energy than our traditional products. Further information on the Group’s energy use can be found in the Environment section.

Safety index1

Targetzero
2008 1.16
2007 2.08
2006 2.41

1 Measured by calendar year

Description. Our safety index compares safety performance across the Group and is a weighted average of injuries sustained in the workplace, with severe accidents having greater impact. The lower the index, the better the performance.

Comment. Employee safety showed good progress in 2008 with a 44.2% improvement on 2007. Further information can be found in the Corporate Social Responsibility section.

Information on the RONOA, energy use and safety performance of each business division can be found in the How we performed section.

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