07/26/2024 | Press release | Distributed by Public on 07/26/2024 05:06
• |
Reported revenue increased 7.8% to $403.5 million in the second quarter of 2024 versus last year's second quarter results of $374.3 million. On a local currency basis(1), revenue increased 8.5%.
|
• |
Reported operating income decreased 3.7% to $49.7 million compared to $51.6 million recorded in the second quarter of 2023. In the second quarter of 2024, the Company recorded $1.8 million of costs related to its Portfolio Optimization Plan. Local currency adjusted operating income(1) and local currency adjusted EBITDA(1) increased 1.1% and 2.3%, respectively, in the second quarter.
|
• |
Reported diluted earnings per share decreased 9.9% to 73 cents in the second quarter of 2024 compared to 81 cents in the second quarter of 2023. Local currency adjusted EPS(1) decreased 2.5% in the second quarter primarily as a result of higher interest expense and a higher tax rate.
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Sensient Technologies Corporation
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Page 2
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Earnings Release - Quarter Ended June 30, 2024
|
|
July 26, 2024
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Reported
|
Local Currency(1)
|
|||||||
Revenue
|
Quarter
|
Year-to-Date
|
Quarter
|
Year-to-Date
|
||||
Flavors & Extracts
|
11.1%
|
9.6%
|
11.1%
|
9.1%
|
||||
Color
|
4.5%
|
1.9%
|
5.2%
|
1.7%
|
||||
Asia Pacific
|
7.1%
|
3.6%
|
11.1%
|
7.4%
|
||||
Total Revenue
|
7.8%
|
6.0%
|
8.5%
|
6.1%
|
||||
Reported
|
Adjusted Local Currency(1)
|
|||||||
Operating Income
|
Quarter
|
Year-to-Date
|
Quarter
|
Year-to-Date
|
||||
Flavors & Extracts
|
7.2%
|
7.0%
|
7.4%
|
6.9%
|
||||
Color
|
7.8%
|
3.4%
|
8.8%
|
3.3%
|
||||
Asia Pacific
|
4.0%
|
-1.0%
|
9.2%
|
3.8%
|
||||
Total Operating Income
|
-3.7%
|
-3.3%
|
1.1%
|
1.8%
|
||||
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Sensient Technologies Corporation
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Page 3
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Earnings Release - Quarter Ended June 30, 2024
|
|
July 26, 2024
|
Metric
|
Updated Guidance
|
Prior Guidance
|
||
Local Currency Revenue(1)
|
Mid-to High Single-Digit Growth
|
Mid-Single-Digit Growth
|
||
Local Currency Adjusted EBITDA(1)
|
Mid-to High Single-Digit Growth
|
Mid-Single-Digit Growth
|
||
Diluted EPS (GAAP)
|
Between $2.77 and $2.87*
|
Between $2.80 and $2.90*
|
||
Local Currency Adjusted Diluted EPS(1)
|
Mid-Single-Digit Growth
|
Low to Mid-Single-Digit Growth
|
||
*The Updated Guidance includes approximately 18 cents of Portfolio Optimization Plan costs. The Prior Guidance included 15 cents of Portfolio Optimization Plan costs.
|
(1) |
Please refer to "Reconciliation of Non-GAAP Amounts" at the end of this release for more information regarding our non-GAAP financial measures.
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Sensient Technologies Corporation
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Page 4
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Earnings Release - Quarter Ended June 30, 2024
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July 26, 2024
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- MORE - |
Sensient Technologies Corporation
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Page 5
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Earnings Release - Quarter Ended June 30, 2024
|
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July 26, 2024
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- MORE - |
Sensient Technologies Corporation
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Page 6 |
(In thousands, except percentages and per share amounts)
|
|
(Unaudited)
|
|
Consolidated Statements of Earnings
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||||||||||||
2024
|
2023
|
% Change
|
2024
|
2023
|
% Change
|
|||||||||||||||||||
Revenue
|
$
|
403,525
|
$
|
374,313
|
7.8
|
%
|
$
|
788,195
|
$
|
743,319
|
6.0
|
%
|
||||||||||||
Cost of products sold
|
272,803
|
252,136
|
8.2
|
%
|
530,924
|
496,479
|
6.9
|
%
|
||||||||||||||||
Selling and administrative expenses
|
81,065
|
70,586
|
14.8
|
%
|
158,208
|
144,411
|
9.6
|
%
|
||||||||||||||||
Operating income
|
49,657
|
51,591
|
(3.7
|
%)
|
99,063
|
102,429
|
(3.3
|
%)
|
||||||||||||||||
Interest expense
|
7,653
|
6,352
|
14,698
|
12,354
|
||||||||||||||||||||
Earnings before income taxes
|
42,004
|
45,239
|
84,365
|
90,075
|
||||||||||||||||||||
Income taxes
|
11,072
|
11,206
|
22,493
|
22,391
|
||||||||||||||||||||
Net earnings
|
$
|
30,932
|
$
|
34,033
|
(9.1
|
%)
|
$
|
61,872
|
$
|
67,684
|
(8.6
|
%)
|
||||||||||||
Earnings per share of common stock:
|
||||||||||||||||||||||||
Basic
|
$
|
0.73
|
$
|
0.81
|
$
|
1.47
|
$
|
1.61
|
||||||||||||||||
Diluted
|
$
|
0.73
|
$
|
0.81
|
$
|
1.46
|
$
|
1.60
|
||||||||||||||||
Average common shares outstanding:
|
||||||||||||||||||||||||
Basic
|
42,154
|
42,043
|
42,129
|
42,006
|
||||||||||||||||||||
Diluted
|
42,398
|
42,235
|
42,351
|
42,245
|
Results by Segment
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||||||||||||
Revenue
|
2024
|
2023
|
% Change
|
2024
|
2023
|
% Change
|
||||||||||||||||||
Flavors & Extracts
|
$
|
209,213
|
$
|
188,284
|
11.1
|
%
|
$
|
402,305
|
$
|
367,136
|
9.6
|
%
|
||||||||||||
Color
|
167,700
|
160,463
|
4.5
|
%
|
327,725
|
321,624
|
1.9
|
%
|
||||||||||||||||
Asia Pacific
|
38,580
|
36,029
|
7.1
|
%
|
78,886
|
76,114
|
3.6
|
%
|
||||||||||||||||
Intersegment elimination
|
(11,968
|
)
|
(10,463
|
)
|
(20,721
|
)
|
(21,555
|
)
|
||||||||||||||||
Consolidated
|
$
|
403,525
|
$
|
374,313
|
7.8
|
%
|
$
|
788,195
|
$
|
743,319
|
6.0
|
%
|
Operating Income
|
||||||||||||||||||||||||
Flavors & Extracts
|
$
|
26,209
|
$
|
24,456
|
7.2
|
%
|
$
|
49,887
|
$
|
46,636
|
7.0
|
%
|
||||||||||||
Color
|
31,502
|
29,217
|
7.8
|
%
|
63,181
|
61,102
|
3.4
|
%
|
||||||||||||||||
Asia Pacific
|
7,880
|
7,575
|
4.0
|
%
|
16,656
|
16,816
|
(1.0
|
%)
|
||||||||||||||||
Corporate & Other
|
(15,934
|
)
|
(9,657
|
)
|
(30,661
|
)
|
(22,125
|
)
|
||||||||||||||||
Consolidated
|
$
|
49,657
|
$
|
51,591
|
(3.7
|
%)
|
$
|
99,063
|
$
|
102,429
|
(3.3
|
%)
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- MORE - |
Sensient Technologies Corporation
|
Page 7 |
(In thousands)
|
|
(Unaudited)
|
|
Consolidated Condensed Balance Sheets
|
June 30,
|
December 31,
|
||||||
2024
|
2023
|
|||||||
Cash and cash equivalents
|
$
|
30,339
|
$
|
28,934
|
||||
Trade accounts receivable
|
315,604
|
272,164
|
||||||
Inventories
|
553,415
|
598,399
|
||||||
Prepaid expenses and other current assets
|
44,897
|
37,119
|
||||||
Total Current Assets
|
944,255
|
936,616
|
||||||
Goodwill & intangible assets (net)
|
429,800
|
436,177
|
||||||
Property, plant, and equipment (net)
|
491,140
|
505,277
|
||||||
Other assets
|
129,672
|
136,437
|
||||||
Total Assets
|
$
|
1,994,867
|
$
|
2,014,507
|
||||
Trade accounts payable
|
$
|
107,218
|
$
|
131,114
|
||||
Short-term borrowings
|
26,995
|
13,460
|
||||||
Other current liabilities
|
92,822
|
91,732
|
||||||
Total Current Liabilities
|
227,035
|
236,306
|
||||||
Long-term debt
|
634,663
|
645,085
|
||||||
Accrued employee and retiree benefits
|
24,872
|
27,715
|
||||||
Other liabilities
|
50,522
|
52,077
|
||||||
Shareholders' Equity
|
1,057,775
|
1,053,324
|
||||||
Total Liabilities and Shareholders' Equity
|
$
|
1,994,867
|
$
|
2,014,507
|
- MORE - |
Sensient Technologies Corporation
|
Page 8 |
(In thousands, except per share amounts) |
|
(Unaudited)
|
|
Consolidated Statements of Cash Flows
|
||||||||
Six Months Ended June 30,
|
||||||||
2024
|
2023
|
|||||||
Cash flows from operating activities:
|
||||||||
Net earnings
|
$
|
61,872
|
$
|
67,684
|
||||
Adjustments to arrive at net cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
29,725
|
28,590
|
||||||
Share-based compensation expense
|
4,911
|
4,766
|
||||||
Net (gain) loss on assets
|
(195
|
)
|
81
|
|||||
Portfolio Optimization Plan costs
|
1,495
|
-
|
||||||
Deferred income taxes
|
529
|
(2,643
|
)
|
|||||
Changes in operating assets and liabilities:
|
||||||||
Trade accounts receivable
|
(49,449
|
)
|
6,062
|
|||||
Inventories
|
36,730
|
(16,927
|
)
|
|||||
Prepaid expenses and other assets
|
(6,612
|
)
|
3,534
|
|||||
Trade accounts payable and other accrued expenses
|
(22,722
|
)
|
(18,329
|
)
|
||||
Accrued salaries, wages, and withholdings
|
7,824
|
(19,713
|
)
|
|||||
Income taxes
|
(6,591
|
)
|
(1,998
|
)
|
||||
Other liabilities
|
1,429
|
595
|
||||||
Net cash provided by operating activities
|
58,946
|
51,702
|
||||||
Cash flows from investing activities:
|
||||||||
Acquisition of property, plant, and equipment
|
(22,850
|
)
|
(45,137
|
)
|
||||
Proceeds from sale of assets
|
296
|
53
|
||||||
Other investing activities
|
(336
|
)
|
2,054
|
|||||
Net cash used in investing activities
|
(22,890
|
)
|
(43,030
|
)
|
||||
Cash flows from financing activities:
|
||||||||
Proceeds from additional borrowings
|
132,189
|
187,037
|
||||||
Debt payments
|
(120,571
|
)
|
(143,923
|
)
|
||||
Dividends paid
|
(34,685
|
)
|
(34,577
|
)
|
||||
Other financing activities
|
(3,016
|
)
|
(8,003
|
)
|
||||
Net cash (used in) provided by financing activities
|
(26,083
|
)
|
534
|
|||||
Effect of exchange rate changes on cash and cash equivalents
|
(8,568
|
)
|
6,419
|
|||||
Net increase in cash and cash equivalents
|
1,405
|
15,625
|
||||||
Cash and cash equivalents at beginning of period
|
28,934
|
20,921
|
||||||
Cash and cash equivalents at end of period
|
$
|
30,339
|
$
|
36,546
|
Supplemental Information
|
||||||||
Six Months Ended June 30,
|
2024
|
2023
|
||||||
Dividends paid per share
|
$
|
0.82
|
$
|
0.82
|
- MORE - |
Sensient Technologies Corporation
|
Page 9 |
(In thousands, except percentages and per share amounts) |
|
(Unaudited)
|
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||||||||||
2024
|
2023
|
% Change
|
2024
|
2023
|
% Change
|
|||||||||||||||||||
Operating income (GAAP)
|
$
|
49,657
|
$
|
51,591
|
(3.7
|
%)
|
$
|
99,063
|
$
|
102,429
|
(3.3
|
%)
|
||||||||||||
Portfolio Optimization Plan costs - Cost of products sold
|
207
|
-
|
314
|
-
|
||||||||||||||||||||
Portfolio Optimization Plan costs - Selling and administrative expenses
|
1,545
|
-
|
4,250
|
-
|
||||||||||||||||||||
Adjusted operating income
|
$
|
51,409
|
$
|
51,591
|
(0.4
|
%)
|
$
|
103,627
|
$
|
102,429
|
1.2
|
%
|
||||||||||||
Net earnings (GAAP)
|
$
|
30,932
|
$
|
34,033
|
(9.1
|
%)
|
$
|
61,872
|
$
|
67,684
|
(8.6
|
%)
|
||||||||||||
Portfolio Optimization Plan costs, before tax
|
1,752
|
-
|
4,564
|
-
|
||||||||||||||||||||
Tax impact of Portfolio Optimization Plan costs(1)
|
(214
|
)
|
-
|
(569
|
)
|
-
|
||||||||||||||||||
Adjusted net earnings
|
$
|
32,470
|
$
|
34,033
|
(4.6
|
%)
|
$
|
65,867
|
$
|
67,684
|
(2.7
|
%)
|
||||||||||||
Diluted earnings per share (GAAP)
|
$
|
0.73
|
$
|
0.81
|
(9.9
|
%)
|
$
|
1.46
|
$
|
1.60
|
(8.8
|
%)
|
||||||||||||
Portfolio Optimization Plan costs, net of tax
|
0.04
|
-
|
0.09
|
-
|
||||||||||||||||||||
Adjusted diluted earnings per share
|
$
|
0.77
|
$
|
0.81
|
(4.9
|
%)
|
$
|
1.56
|
$
|
1.60
|
(2.5
|
%)
|
Results by Segment
|
Three Months Ended June 30,
|
|||||||||||||||||||||||
Adjusted
|
Adjusted
|
|||||||||||||||||||||||
Operating Income
|
2024
|
Adjustments(2)
|
2024
|
2023
|
Adjustments(2)
|
2023
|
||||||||||||||||||
Flavors & Extracts
|
$
|
26,209
|
$
|
-
|
$
|
26,209
|
$
|
24,456
|
$
|
-
|
$
|
24,456
|
||||||||||||
Color
|
31,502
|
-
|
31,502
|
29,217
|
-
|
29,217
|
||||||||||||||||||
Asia Pacific
|
7,880
|
-
|
7,880
|
7,575
|
-
|
7,575
|
||||||||||||||||||
Corporate & Other
|
(15,934
|
)
|
1,752
|
(14,182
|
)
|
(9,657
|
)
|
-
|
(9,657
|
)
|
||||||||||||||
Consolidated
|
$
|
49,657
|
$
|
1,752
|
$
|
51,409
|
$
|
51,591
|
$
|
-
|
$
|
51,591
|
Results by Segment
|
Six Months Ended June 30,
|
|||||||||||||||||||||||
Adjusted
|
Adjusted
|
|||||||||||||||||||||||
Operating Income
|
2024
|
Adjustments(2)
|
2024
|
2023
|
Adjustments(2)
|
2023
|
||||||||||||||||||
Flavors & Extracts
|
$
|
49,887
|
$
|
-
|
$
|
49,887
|
$
|
46,636
|
$
|
-
|
$
|
46,636
|
||||||||||||
Color
|
63,181
|
-
|
63,181
|
61,102
|
-
|
61,102
|
||||||||||||||||||
Asia Pacific
|
16,656
|
-
|
16,656
|
16,816
|
-
|
16,816
|
||||||||||||||||||
Corporate & Other
|
(30,661
|
)
|
4,564
|
(26,097
|
)
|
(22,125
|
)
|
-
|
(22,125
|
)
|
||||||||||||||
Consolidated
|
$
|
99,063
|
$
|
4,564
|
$
|
103,627
|
$
|
102,429
|
$
|
-
|
$
|
102,429
|
- MORE - |
Sensient Technologies Corporation
|
Page 10 |
(In thousands, except percentages) |
|
(Unaudited)
|
|
Three Months Ended June 30, 2024
|
||||||||||||||||
Revenue
|
Total
|
Foreign
Exchange
Rates
|
Adjustments(3)
|
Adjusted
Local
Currency
|
||||||||||||
Flavors & Extracts
|
11.1
|
%
|
0.0
|
%
|
N/A
|
11.1
|
%
|
|||||||||
Color
|
4.5
|
%
|
(0.7
|
%)
|
N/A
|
5.2
|
%
|
|||||||||
Asia Pacific
|
7.1
|
%
|
(4.0
|
%)
|
N/A
|
11.1
|
%
|
|||||||||
Total Revenue
|
7.8
|
%
|
(0.7
|
%)
|
N/A
|
8.5
|
%
|
|||||||||
Operating Income
|
||||||||||||||||
Flavors & Extracts
|
7.2
|
%
|
(0.2
|
%)
|
0.0
|
%
|
7.4
|
%
|
||||||||
Color
|
7.8
|
%
|
(1.0
|
%)
|
0.0
|
%
|
8.8
|
%
|
||||||||
Asia Pacific
|
4.0
|
%
|
(5.2
|
%)
|
0.0
|
%
|
9.2
|
%
|
||||||||
Corporate & Other
|
65.0
|
%
|
0.0
|
%
|
18.1
|
%
|
46.9
|
%
|
||||||||
Total Operating Income
|
(3.7
|
%)
|
(1.4
|
%)
|
(3.4
|
%)
|
1.1
|
%
|
||||||||
Diluted Earnings Per Share
|
(9.9
|
%)
|
(2.5
|
%)
|
(4.9
|
%)
|
(2.5
|
%)
|
||||||||
Adjusted EBITDA
|
1.2
|
%
|
(1.1
|
%)
|
N/A
|
2.3
|
%
|
Six Months Ended June 30, 2024
|
||||||||||||||||
Revenue
|
Total
|
Foreign
Exchange
Rates
|
Adjustments(3)
|
Adjusted
Local
Currency
|
||||||||||||
Flavors & Extracts
|
9.6
|
%
|
0.5
|
%
|
N/A
|
9.1
|
%
|
|||||||||
Color
|
1.9
|
%
|
0.2
|
%
|
N/A
|
1.7
|
%
|
|||||||||
Asia Pacific
|
3.6
|
%
|
(3.8
|
%)
|
N/A
|
7.4
|
%
|
|||||||||
Total Revenue
|
6.0
|
%
|
(0.1
|
%)
|
N/A
|
6.1
|
%
|
|||||||||
Operating Income
|
||||||||||||||||
Flavors & Extracts
|
7.0
|
%
|
0.1
|
%
|
0.0
|
%
|
6.9
|
%
|
||||||||
Color
|
3.4
|
%
|
0.1
|
%
|
0.0
|
%
|
3.3
|
%
|
||||||||
Asia Pacific
|
(1.0
|
%)
|
(4.8
|
%)
|
0.0
|
%
|
3.8
|
%
|
||||||||
Corporate & Other
|
38.6
|
%
|
0.0
|
%
|
20.6
|
%
|
18.0
|
%
|
||||||||
Total Operating Income
|
(3.3
|
%)
|
(0.7
|
%)
|
(4.4
|
%)
|
1.8
|
%
|
||||||||
Diluted Earnings Per Share
|
(8.8
|
%)
|
(0.7
|
%)
|
(6.2
|
%)
|
(1.9
|
%)
|
||||||||
Adjusted EBITDA
|
1.8
|
%
|
(0.4
|
%)
|
N/A
|
2.2
|
%
|
- MORE - |
Sensient Technologies Corporation
|
Page 11 |
(In thousands, except percentages and per share amounts) |
|
(Unaudited)
|
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||||||||||
2024
|
2023
|
% Change
|
2024
|
2023
|
% Change
|
|||||||||||||||||||
Operating income (GAAP)
|
$
|
49,657
|
$
|
51,591
|
(3.7
|
%)
|
$
|
99,063
|
$
|
102,429
|
(3.3
|
%)
|
||||||||||||
Depreciation and amortization
|
15,016
|
14,440
|
29,725
|
28,590
|
||||||||||||||||||||
Share-based compensation expense
|
2,916
|
2,499
|
4,911
|
4,766
|
||||||||||||||||||||
Portfolio Optimization Plan costs, before tax
|
1,752
|
-
|
4,564
|
-
|
||||||||||||||||||||
Adjusted EBITDA
|
$
|
69,341
|
$
|
68,530
|
1.2
|
%
|
$
|
138,263
|
$
|
135,785
|
1.8
|
%
|
June 30,
|
||||||||
Debt
|
2024
|
2023
|
||||||
Short-term borrowings
|
$
|
26,995
|
$
|
15,436
|
||||
Long-term debt
|
634,663
|
686,589
|
||||||
Credit Agreement adjustments(1)
|
(18,034
|
)
|
(19,755
|
)
|
||||
Net Debt
|
$
|
643,624
|
$
|
682,270
|
||||
Operating income (GAAP)
|
$
|
151,657
|
$
|
191,147
|
||||
Depreciation and amortization
|
58,955
|
54,877
|
||||||
Share-based compensation expense
|
9,078
|
12,213
|
||||||
Portfolio Optimization Plan costs, before tax
|
32,405
|
-
|
||||||
Other non-operating gains(2)
|
(872
|
)
|
(3,326
|
)
|
||||
Credit Adjusted EBITDA
|
$
|
251,223
|
$
|
254,911
|
||||
Net Debt to Credit Adjusted EBITDA
|
2.6
|
x
|
2.7
|
x
|
Twelve Months Ended December 31,
|
||||
2023
|
||||
Diluted earnings per share (GAAP)
|
$
|
2.21
|
||
Portfolio Optimization Plan costs, net of tax
|
0.65
|
|||
Adjusted diluted earnings per share
|
$
|
2.86
|