Treatt Reports H1 Results In Line With Expectations as Döhler Offer Recommended

Treatt H1 2026 results: softer profits, but no real shock in the numbers

Treatt’s half-year results were not pretty on the surface, but they were also not a nasty surprise. Revenue, profit and earnings all moved lower in the six months to 31 March 2026, yet management said trading was in line with expectations and the board still expects full-year performance to land where it hoped.

The bigger twist is that these results arrived alongside a recommended cash offer from Döhler Finance Management B.V of 305p per share, with shareholders also able to retain the previously declared final dividend of 3.0p per share for FY2025. That means the investment story has shifted from “can Treatt recover in H2?” to “does the offer fairly reflect that recovery potential?”

Treatt half-year key numbers at a glance

Metric	H1 2026	H1 2025	Change
Revenue	£59.9m	£64.0m	(6.5)%
Gross profit margin	24.9%	25.1%	(20)bps
Adjusted EBITDA	£5.4m	£6.5m	(18.1)%
Operating profit before exceptional items	£2.8m	£3.9m	(28.0)%
Profit before tax before exceptional items	£2.5m	£3.7m	(33.4)%
Basic EPS	2.48p	3.63p	(31.7)%
Adjusted basic EPS	3.04p	4.56p	(33.3)%
Net debt	£4.4m	Net cash £0.9m	£5.3m movement

A quick note on language. EBITDA means earnings before interest, tax, depreciation and amortisation – basically a rough measure of underlying operating cash profit. “Bps” means basis points, so 20bps is 0.2 percentage points.

Why Treatt revenue and profit fell in H1 2026

The short version is that Treatt is still working through weak citrus demand, lower Premium volumes and softer North American trading. None of that was hidden. The company had already signposted that citrus would take time to recover after volatility in FY2025.

Revenue fell 6.5% to £59.9m, or 4.1% in constant currency, which strips out exchange rate effects. Profit before tax and exceptional items dropped to £2.5m from £3.7m, with lower sales doing most of the damage.

Heritage division: citrus still hurting, but there are signs of life

Heritage revenue declined 8.8%, led by citrus, where revenue fell 11.1% year-on-year. Treatt said prices reduced in line with market prices in orange oil, so this is a mix of price pressure and slower recovery in volumes.

That is the main negative in this update. Citrus matters a lot to Treatt, and while management says headwinds are easing and H2 should show some positive momentum, it also admits a full recovery will take time. That is honest, but it tells you this is not a snap-back story.

The encouraging bit is that Treatt is trying to defend customer relationships rather than simply sit and wait. It launched powdered citrus extracts and developed price-stable citrus solutions, which sounds practical and commercially sensible in a volatile market.

Premium division: weaker sales, but better quality sales

Premium revenue fell 8.3%, which is not great, but gross profit in the division actually increased 3%. That matters because it suggests Treatt is shifting the mix towards more valuable work rather than chasing revenue for the sake of it.

The standout was health & wellness, where revenue jumped 29.0%. Management linked that to sugar reduction and low-and-no beverage applications, which are both attractive long-term trends and, importantly, one of Treatt’s highest-margin categories.

On the flip side, fruit & vegetables and tea were weaker after exiting lower-value business and as customers reformulated products. That hurts near-term sales, but it can be the right move if it improves margins and quality of earnings over time.

New Markets and China: the brightest line in the release

New Markets revenue rose 16.7%, led by China. China sales were up 20.8% and now account for 8.9% of group revenue, up from 6.9% a year ago.

That is probably the most exciting operational detail in the RNS. The Shanghai Commercial & Innovation Centre is now fully operational and appears to be helping Treatt work more closely with customers. If that continues, it gives the group a more balanced growth profile beyond the slower US market.

Treatt margins, costs and cash flow: mixed, but not alarming

Gross profit margin slipped slightly to 24.9% from 25.1%. Adjusted operating profit margin fell more sharply to 4.7% from 6.0%, because lower gross profit flowed through while the cost base stayed broadly flat.

That is the awkward bit of this model. When volumes soften, fixed costs do not disappear, so margins can get squeezed quickly. The good news is pre-exceptional operating costs actually decreased 0.4% to £12.1m, which shows management is keeping a lid on overheads.

Cash flow was weaker than last year, but there are some reassuring details. Net cash generated by operations was £2.8m, down from £8.3m, mainly because of lower profit and a £2.3m adverse working capital movement. Even so, inventories fell by £1.2m, which suggests stock control is moving in the right direction.

Net debt improved during the half

Treatt ended the period with net debt of £4.4m, better than the year-end 2025 position of net debt of £5.9m. So while the company is in net debt rather than net cash, it did generate a £1.5m cash inflow in the half and expects to return to net cash by year end.

The balance sheet still looks solid enough from the information disclosed. Treatt has a $25m facility with Bank of America and a £25m facility with HSBC, both extended to H2 2027, which gives it headroom.

Dividend pause and the 305p Döhler offer: this is now the main event

Because of the recommended offer from Döhler Finance Management B.V, the board has decided not to declare an interim dividend for this period. That will disappoint income investors, but in takeover situations it is fairly standard for capital allocation to change.

The offer itself is 305p per share in cash, and shareholders can also retain the previously declared final dividend of 3.0p per share for the year ended 30 September 2025. That is now the key figure for shareholders to weigh up.

My view is simple: these H1 results do not scream “business in trouble”, but they also do not show a company firing on all cylinders. Treatt has some very appealing growth areas – especially health & wellness and China – yet the near-term drag from citrus and North America is real. That makes a cash bid more understandable, because it removes the execution risk of waiting for H2 and beyond.

What matters for retail investors from Treatt’s H1 results

• Trading was weaker, but expected: the drop in revenue and profit was already baked into management’s outlook.
• Citrus is still the problem child: there are early signs of improvement, but recovery is slow.
• Health & wellness is a genuine bright spot: 29.0% growth in a high-margin category is exactly what investors want to see.
• China is becoming more important: 20.8% revenue growth there gives Treatt another route to growth.
• Cash generation is improving versus year end: net debt reduced from £5.9m to £4.4m in the half.
• The takeover offer now dominates the story: the market focus is likely to be on the 305p cash offer rather than standalone H1 numbers.

Bottom line on Treatt PLC H1 2026 results

This was a steady rather than sparkling update. The negatives are obvious – lower revenue, lower profit, weaker US demand and a citrus recovery that is taking its time. But the positives are real too: costs are controlled, margins in Premium are improving in quality terms, China is growing nicely, and the company still expects a stronger second half.

If there had been no bid, investors would probably have viewed this as an acceptable but unspectacular set of results with recovery pushed into H2. With the Döhler offer on the table, though, these numbers mainly help explain why the board was willing to recommend a deal now. Treatt is not broken, but it is still mid-repair.