6th Aug 2025 13:42
(Alliance News) - THG PLC on Wednesday announced it has agreed to sell its flavourings brand Claremont Ingredients, as the business expects to post a double-digit decline in earnings for the first half of its current financial year.
The Manchester-based retail firm, behind brands such as Lookfantastic and Myprotein, said it has agreed to divest Claremont Ingredients, a flavour manufacturing and development laboratory for sports nutrition, from its THG Nutrition business for around GBP103 million in cash.
The sale was made to Nactarome Spa, the Milan-headquartered producer of natural flavourings, colours and ingredients for the food and beverage sector. Nactarome is majority-owned by Boston, Massachusetts-based private equity firm TA Associates Management LP.
THG says the disposal marked a "significant" return on its initial investment, after purchasing Claremont Ingredients in late 2020 for GBP52 million with the aim of "accelerating" the launch of a global licensing range within the Myprotein brand, as well as new product development.
Claremont reported around GBP14 million in revenue in 2024.
Proceeds from the sale will contribute towards reducing net leverage and borrowing costs, THG said, in line with the company's capital allocation strategy targeting a neutral net cash and net debt position.
As a result of the disposal, THG's full-year earnings before interest, tax, depreciation and amortisation for 2025 and 2026 are expected to reduce by around GBP5 million and around GBP10 million respectively.
For the first half to June 30, THG expects to post adjusted Ebitda of roughly GBP24 million, down 35% from GBP37.1 million the year before, due to "substantially higher" whey pricing in its Nutrition segment.
However, this has helped raise consumer prices, leading to a double-digit jump in revenues in June and July for the group's Nutrition arm, it noted. The company now expects revenue growth between 10% and 12% for its Nutrition unit during the second half.
THG said it would limit further price hikes over the second half of 2025 in a bid to retain customers and grow its share of the market. It also announced an investment of around GPB15 million during 2025, which will result in a group adjusted Ebitda of roughly GBP50 million in the second half of the year.
THG noted that its Beauty arm has started the second half "well", with an "improved" revenue growth rate.
The company's interim results will be published in September.
"The decisions we are taking as a business to support our customers and grow Myprotein's market share aligns clearly with our wider strategy to streamline the group and focus on our core strengths, whilst maintaining a strong balance sheet," said THG Chief Executive Officer Matthew Moulding.
Shares in THG were up 0.7% at 30.78 pence in London on Wednesday afternoon. The stock remains down 51% over the past year.
By Emily Parsons, Alliance News reporter
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