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* Taking longer than expected to make up winter shortfall
* New CFO leading review of planning, supply chain
* Sucralose prices seen down 25 pct this year, not 15 pct
* Sees adj profit of 230-245 mln pounds, below analystestimates
* Shares plunge 16 percent (Adds company, analyst comments, byline)
By Martinne Geller and Paul Sandle
LONDON, Sept 23 (Reuters) - Tate & Lyle sharestumbled to a three-year low after it cut its full-year profitforecast, blaming fierce competition for its Splenda sweetenerand supply chain problems caused by a severe U.S. winter.
The British company, which sells ingredients to packagedfood and drinks makers, has had to renegotiate supply contractsat lower prices to protect market share in the face of intenseChinese competition.
It said on Tuesday it expected prices of its Splendasucralose to fall by 25 percent this year, rather than the 15percent decline it forecast in February.
It also said the prolonged and harsh winter in the UnitedStates disrupted operations at its corn plants, causing globalsupply problems which ate into profits. The delays meant thefirm had to deliver to some customers by air, rather than byshipping, and it said it was still working to catch up.
"If we had to air freight stuff, we air freighted. That costus money," said Chief Executive Javed Ahmed.
Shares in Tate & Lyle were down 16.5 percent to 611 pence at1342 GMT, more than wiping out the gains they had made since theFebruary price warning.
"We are sufficiently concerned about the timeline to turnaround sucralose pricing and the supply chain management issuesto warrant a more negative stance on the shares," said CanaccordGenuity, which downgraded the stock to "sell" from "hold".
"The fact that Tate has issued such a significant profitwarning within two months of the last guidance update points toa serious lack of visibility, not only within one of its endmarkets (sucralose) but also internally."
Canaccord said questions over management credibility shouldplague the stock moving forward, but that speculation that itcould now be a takeover target might limit the downside.
Tate & Lyle said it now expects adjusted pre-tax profit forthe year to end-March 2015 in the range of 230 to 245 millionpounds ($377-$402 million).
That is well below analysts' expectations for 293 millionpounds, according to a Reuters poll of 13 brokers - based on thecompany's forecast in July for profit slightly below that offiscal 2014's 322 million pounds.
"Clearly our performance in the first half has beenextremely disappointing," Ahmed said on a conference call. Thecompany is due to report results for the first half on Nov. 6.
VOLATILE
Tate & Lyle generates most of its sales from bulkingredients like corn syrup and industrial starches, whereprices are volatile due to fluctuating commodity costs andintense competition.
The company has been moving more into higher-marginspecialty ingredients like oat proteins and artificialsweeteners that are in higher demand by food companies lookingto make their products healthier.
Explaining the roughly 50 million pound fall in the profitoutlook, Ahmed said about 20 to 25 million was related to theworsening outlook for sucralose pricing. About 30 million wasfrom what he called a "one-off" issue related to thesupply-chain problems which incurred extra costs in the secondquarter as it scrambled to service customers.
"The manufacturing and supply chain challenges we faced havehighlighted the need for us to look in detail at our planningand supply chain processes and I've asked (new chief financialofficer) Nick Hampton to take the lead on that," Ahmed said.Hampton joined three weeks ago from PepsiCo.
"Whilst these are non-recurring costs, the fact thatdisruption from last winter is still being resolved issurprising and disappointing," said Citi analysts in a note.
(1 US dollar = 0.6093 British pound) (Editing by Pravin Char)
