Press Release

IFF Reports Second Quarter 2022 Results

NEW YORK--(BUSINESS WIRE)--Aug. 8, 2022-- International Flavors & Fragrances Inc. (NYSE: IFF) reported financial results for the second quarter ended June 30, 2022.

Second Quarter 2022 Consolidated Summary:

Reported

(GAAP)

 

Adjusted

(Non-GAAP)1

Sales

 

Income Before
Taxes

 

EPS

 

Operating
EBITDA

 

Operating
EBITDA Margin

 

EPS ex
Amortization

$3.3 B

 

$130 M

 

$0.43

 

$700 M

 

21.2%

 

$1.54

First Six Months 2022 Consolidated Summary:

Reported

(GAAP)

 

Adjusted

(Non-GAAP)1

Sales

 

Income Before
Taxes

 

EPS

 

Operating
EBITDA

 

Operating
EBITDA Margin

 

EPS ex
Amortization

$6.5 B

 

$415 M

 

$1.38

 

$1.4 B

 

21.5%

 

$3.23

Management Commentary

"We continued to execute on our near-term operational priorities to achieve strong top and bottom-line results in the second quarter," said IFF CEO Frank Clyburn. "Our teams have acted with urgency to implement necessary pricing actions in collaboration with our customers and delivered productivity benefits that offset on-going inflationary pressures. Going forward, we are preparing for more uncertain market conditions, yet remain confident in delivering our full year financial objectives. At the same time, we are advancing our strategic efforts, deploying innovation, refining our portfolio and strengthening our culture to deliver strong value creation for all our stakeholders. Reflecting our confidence, we are pleased to announce that we are raising our quarterly dividend. This marks thirteen years of consecutive dividend increases and underscores our belief in our business, and strong future cash-flow generation.”

Second Quarter 2022 Consolidated Financial Results

  • Reported net sales for the second quarter were $3.31 billion, an increase of 7% compared to the prior-year period. On a comparable basis2, currency neutral sales increased 11%, led by double-digit growth in Nourish and Pharma Solutions.
  • Income before taxes on a reported basis for the second quarter was $130 million. Adjusted operating EBITDA for the second quarter was $700 million, an increase of 3% from $679 million in the prior-year period. On a comparable basis2, currency neutral adjusted operating EBITDA increased 7%, driven by pricing actions and productivity gains.
  • Reported earnings per share (EPS) for the second quarter was $0.43. Adjusted EPS excluding amortization was $1.54 per diluted share.
  • Cash flow from operations at the end of the second quarter was $(100) million, and free cash flow defined as cash flow from operations less capital expenditures totaled $(336) million, principally due to higher inventory value as a result of inflationary pressures. Net debt to credit adjusted EBITDA at the end of the second quarter was 4.4x.

____________________________
1 Schedules at the end of this release contain reconciliations of reported GAAP to Non-GAAP metrics. See Use of Non-GAAP Financial Measures for explanations of our Non-GAAP metrics.
2 Comparable results for the second quarter exclude the impact of divestitures in the prior year period and acquisitions in the current-year period.

Second Quarter 2022 Segment Summary: Growth vs. Prior Year

 

Reported

(GAAP)

 

Adjusted
(Non-GAAP)

 

Comparable
Currency
Neutral

(Non-GAAP)2

 

Comparable
Currency Neutral
Adjusted

(Non-GAAP)2

 

Sales

 

Operating
EBITDA

 

Sales

 

Operating
EBITDA

Nourish

9%

 

13%

 

15%

 

18%

Health & Biosciences

4%

 

(3)%

 

4%

 

(2)%

Scent

5%

 

(21)%

 

9%

 

(17)%

Pharma Solutions

5%

 

21%

 

10%

 

25%

Nourish Segment

  • On a reported basis, second quarter sales were $1.82 billion. On a comparable basis2 , currency neutral sales grew 15% led by double-digit growth in Food Designs and high single-digit growth in Flavors.
  • Nourish adjusted operating EBITDA was $365 million and adjusted operating EBITDA margin was 20.1% in the second quarter. On a comparable basis2, currency neutral adjusted operating EBITDA grew 18% driven by strong pricing actions and productivity gains.

Health & Biosciences Segment

  • On a reported basis, second quarter sales were $665 million. On a comparable basis2 , currency neutral sales increased 4% led by double-digit growth in Microbial Control, high single-digit increases in Health and Cultures & Food Enzymes and a mid single-digit increase in Animal Nutrition.
  • Health & Biosciences adjusted operating EBITDA was $184 million and adjusted operating EBITDA margin was 27.7% in the second quarter. On a comparable basis2, currency neutral adjusted operating EBITDA declined 2% as price increases and productivity gains were offset by lower volumes and unfavorable mix.

Scent Segment

  • On a reported basis, second quarter sales were $580 million. On a comparable basis2, currency neutral sales increased 9% with double-digit growth in Fine Fragrance, high single-digit growth in Fragrance Ingredients and low single-digit growth from Consumer Fragrance.
  • Scent adjusted operating EBITDA was $93 million and adjusted operating EBITDA margin was 16.0% in the second quarter. On a comparable basis2, currency neutral adjusted operating EBITDA declined 17% due to the time lag between full price realization relative to inflationary pressures.

Pharma Solutions Segment

  • On a reported basis, second quarter sales were $244 million. On a comparable basis2, currency neutral sales increased 10% with double-digit growth in Industrial and a high single-digit increase in Pharma.
  • Pharma Solutions adjusted operating EBITDA was $58 million and adjusted operating EBITDA margin was 23.8% in the second quarter. On a comparable basis2, currency neutral adjusted operating EBITDA grew 25% led by price increases and productivity gains.

Impairment of Long-Lived Assets

During the second quarter of 2022, the Company recognized an impairment charge of $120 million within certain entities in Russia due to supply chain issues, reduced product demand and exchange rate volatility as a result of the Russia-Ukraine conflict. It was determined that such declines in operating performance were not expected to reverse in the near future and future expected growth is expected to be limited given the operating conditions in Russia. This non-cash impairment charge was allocated pro rata to intangible assets and property, plant and equipment within the asset group in the amounts of approximately $92 million and $28 million, respectively. The Company maintains operations in both Russia and Ukraine and, additionally, exports products to customers in Russia and Ukraine from operations outside the region. In response to the events in Ukraine, the Company has limited the production and supply of ingredients in and to Russia to only those that meet the essential needs of people, including food, hygiene and medicine.

Quarterly Dividend

On August 3, 2022, the Board of Directors authorized a 3%, or $0.02 increase, in the quarterly dividend to $0.81 per share of the Company’s common stock. The quarterly dividend is payable on October 5, 2022 to shareholders of record as of September 23, 2022. Including this authorization, IFF has increased its quarterly dividend payment for the thirteenth consecutive year.

Amendment to Existing Debt Agreements

On August 4, 2022, IFF amended its existing Term Loan Credit Agreement and Revolving Credit Agreement. These proactive amendments, in cooperation with supporting banks, delay certain step downs from maximum permitted leverage ratio of 4.50 to 1.0, stepping down to 3.50 to 1.0 over time, with the first step-down now occurring at the end of the third quarter 2023 versus the end of the fourth quarter 2022 previously.

Financial Guidance

The Company reaffirms full year 2022 financial guidance. The Company continues to expect full year 2022 sales to be approximately $12.6 billion to $13.0 billion, with an expected full year 2022 adjusted operating EBITDA of approximately $2.5 billion to $2.6 billion.

The Company continues to expect to deliver comparable currency neutral sales growth of approximately 9% to 12% for the full year 2022, with comparable currency neutral adjusted operating EBITDA growth to be approximately 4% to 8%.

Based on current market foreign exchange rates, the Company now expects that foreign exchange will negatively impact sales growth in 2022 by approximately 5 percentage points (versus 4 previously) and adjusted operating EBITDA growth by approximately 6 percentage points (versus 5 previously).

Audio Webcast

A live webcast to discuss the Company’s second quarter 2022 financial results will be held on August 9, 2022, at 9:00 a.m. ET. The webcast and accompanying slide presentation may be accessed on the Company's IR website at ir.iff.com. For those unable to listen to the live webcast, a recorded version will be made available on the Company's website approximately one hour after the event and will remain available on IFF’s website for one year.

Cautionary Statement Under The Private Securities Litigation Reform Act of 1995

Statements in this press release, which are not historical facts or information, are “forward-looking statements” within the meaning of The Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on management’s current assumptions, estimates and expectations including those concerning the impacts of COVID-19 and our plans to respond to its implications; the expected impact of global supply chain challenges; expectations regarding sales and profit for the fiscal year 2022, including the impact of foreign exchange, pricing actions, raw materials, and sourcing, logistics and manufacturing costs; expectations of the impact of inflationary pressures and the pricing actions to offset exposure to such impacts; the impact of high input costs, including commodities, raw materials, transportation and energy; our ability to drive cost discipline measures and the ability to recover margin to pre-inflation levels; the divestiture of our Microbial Control business and the progress of our portfolio optimization strategy, through non-core business divestitures and acquisitions, such as the Health Wright acquisition; our combination with N&B, including the expected benefits and synergies of the N&B Transaction and future opportunities for the combined company, the success of our integration efforts and ability to deliver on our synergy commitments as well as future opportunities for the combined company; our ability to achieve the anticipated benefits of the Frutarom acquisition, including $145 million of expected synergies; the growth potential of the markets in which we operate, including the emerging markets, expected capital expenditures in 2022, the expected costs and benefits of our ongoing optimization of our manufacturing operations, including the expected number of closings, expected cash flow and availability of capital resources to fund our operations and meet our debt service requirements; our ability to innovate and execute on specific consumer trends and demands; our ability to strengthen our company culture; and our ability to continue to generate value for, and return cash to, our shareholders.

These forward-looking statements should be evaluated with consideration given to the many risks and uncertainties inherent in our business that could cause actual results and events to differ materially from those in the forward-looking statements. Certain of such forward-looking information may be identified by such terms as “expect”, “anticipate”, “believe”, “intend”, “outlook”, “may”, “estimate”, “should”, “predict” and similar terms or variations thereof. Such forward-looking statements are based on a series of expectations, assumptions, estimates and projections about the Company, are not guarantees of future results or performance, and involve significant risks, uncertainties and other factors, including assumptions and projections, for all forward periods. Our actual results may differ materially from any future results expressed or implied by such forward-looking statements.

Such risks, uncertainties and other factors include, among others, the following: (1) inflationary trends in the price of our input costs, such as raw materials, transportation and energy; (2) supply chain disruptions, geopolitical developments, including the Russia-Ukraine conflict, or climate-change related events (including severe weather events) that may affect our suppliers or procurement of raw materials; (3) disruption in the development, manufacture, distribution or sale of our products from COVID-19 and other public health crises; (4) risks related to the integration of N&B and the Frutarom business, including whether we will realize the benefits anticipated from the acquisitions in the expected time frame; (5) our ability to successfully establish and manage acquisitions, collaborations, joint ventures or partnerships, or the failure to close strategic transactions or divestments; (6) our ability to successfully market to our expanded and diverse customer base; (7) our substantial amount of indebtedness and its impact on our liquidity and ability to return capital to its shareholders; (8) our ability to effectively compete in our market and develop and introduce new products that meet customers’ needs; (9) our ability to retain key employees; (10) changes in demand from large multi-national customers due to increased competition and our ability to maintain “core list” status with customers; (11) our ability to successfully develop innovative and cost-effective products that allow customers to achieve their own profitability expectations; (12) disruption in the development, manufacture, distribution or sale of our products from natural disasters, public health crises, international conflicts, terrorist acts, labor strikes, political crisis, accidents and similar events; (13) the impact of a significant data breach or other disruption in our information technology systems, and our ability to comply with data protection laws in the U.S. and abroad; (14) volatility and increases in the price of raw materials, energy and transportation; (15) our ability to comply with, and the costs associated with compliance with, regulatory requirements and industry standards, including regarding product safety, quality, efficacy and environmental impact; (16) our ability to meet increasing customer, consumer, shareholder and regulatory focus on sustainability; (17) defect, quality issues (including product recalls), inadequate disclosure or misuse with respect to the products and capabilities; (18) our ability to react in a timely and cost-effective manner to changes in consumer preferences and demands, including increased awareness of health and wellness; (19) our ability to benefit from our investments and expansion in emerging markets; (20) the impact of currency fluctuations or devaluations in the principal foreign markets in which we operate; (21) economic, regulatory and political risks associated with our international operations; (22) the impact of global economic uncertainty on demand for consumer products; (23) our ability to comply with, and the costs associated with compliance with, U.S. and foreign environmental protection laws; (24) our ability to successfully manage our working capital and inventory balances; (25) the impact of the failure to comply with U.S. or foreign anti-corruption and anti-bribery laws and regulations, including the U.S. Foreign Corrupt Practices Act; (26) any impairment of our tangible or intangible long lived assets, including goodwill associated with the N&B merger and the acquisition of Frutarom; (27) our ability to protect our intellectual property rights; (28) the impact of the outcome of legal claims, regulatory investigations and litigation; (29) changes in market conditions or governmental regulations relating to our pension and postretirement obligations; (30) the impact of changes in federal, state, local and international tax legislation or policies, including the Tax Cuts and Jobs Act, with respect to transfer pricing and state aid, and adverse results of tax audits, assessments, or disputes; (31) the impact of the United Kingdom’s departure from the European Union; (32) the impact of the phase out of the London Interbank Offered Rate (LIBOR) on interest expense; and (33) risks associated with our CEO transition, including the impact on employee hiring and retention.

The foregoing list of important factors does not include all such factors, nor necessarily present them in order of importance. In addition, you should consult other disclosures made by the Company (such as in our other filings with the SEC or in company press releases) for other factors that may cause actual results to differ materially from those projected by the Company. Please refer to Part I. Item 1A., Risk Factors, of the Company’s Annual Report on Form 10-K filed with the SEC on February 28, 2022 for additional information regarding factors that could affect our results of operations, financial condition and liquidity.

We intend our forward-looking statements to speak only as of the time of such statements and do not undertake or plan to update or revise them as more information becomes available or to reflect changes in expectations, assumptions or results. We can give no assurance that such expectations or forward-looking statements will prove to be correct. An occurrence of, or any material adverse change in, one or more of the risk factors or risks and uncertainties referred to in this press release or included in our other periodic reports filed with the SEC could materially and adversely impact our operations and our future financial results. Any public statements or disclosures made by us following this press release that modify or impact any of the forward-looking statements contained in or accompanying this press release will be deemed to modify or supersede such outlook or other forward-looking statements in or accompanying this press release.

Use of Non-GAAP Financial Measures

We provide in this press release non-GAAP financial measures, including: (i) comparable currency neutral sales; (ii) adjusted operating EBITDA and comparable currency neutral adjusted operating EBITDA; (iii) adjusted operating EBITDA margin; (iv) adjusted EPS ex amortization; (v) free cash flow; and (vi) net debt to credit adjusted EBITDA.

Our non-GAAP financial measures are defined below.

Currency Neutral metrics eliminate the effects that result from translating non-U.S. currencies to U.S. dollars. We calculate currency neutral numbers by translating current year invoiced sale amounts at the exchange rates used for the corresponding prior year period. We use currency neutral results in our analysis of subsidiary or segment performance. We also use currency neutral numbers when analyzing our performance against our competitors.

Adjusted operating EBITDA and adjusted operating EBITDA margin exclude depreciation and amortization expense, interest expense, other (expense) income, net, restructuring and other charges and certain non-recurring items such as acquisition related costs, gains on sale of assets, impairment of long-lived assets, shareholder activism related costs, business divestiture costs, employee separation costs, Frutarom acquisition related costs, N&B inventory step-up costs, N&B transaction related costs, integration related costs and the impact of the merger with N&B.

Adjusted EPS ex Amortization excludes the impact of non-operational items including restructuring and other charges, acquisition related costs, gains on sale of assets, impairment of long-lived assets, shareholder activism related costs, business divestiture costs, employee separation costs, Frutarom acquisition related costs, N&B inventory step-up costs, N&B transaction related costs, integration related costs, redemption value adjustment to EPS, the impact of the merger with N&B and non-cash items including the amortization of acquisition related intangible assets.

Free Cash Flow is operating cash flow (i.e. cash flow from operations) less capital expenditures.

Net debt to credit adjusted EBITDA is the leverage ratio used in our credit agreements and defined as net debt (which is debt for borrowed money less cash and cash equivalents) divided by the trailing 12-month credit adjusted EBITDA. Credit adjusted EBITDA is defined as income (loss) before income taxes, depreciation and amortization expense, interest expense, specified items and non-cash items.

Comparable results for the second quarter excludes the impact of divestitures in the prior year period and acquisitions in the current year period.

These non-GAAP measures are intended to provide additional information regarding our underlying operating results and comparable year-over-year performance. Such information is supplemental to information presented in accordance with GAAP and is not intended to represent a presentation in accordance with GAAP. In discussing our historical and expected future results and financial condition, we believe it is meaningful for investors to be made aware of and to be assisted in a better understanding of, on a period-to-period comparable basis, financial amounts both including and excluding these identified items, as well as the impact of exchange rate fluctuations. These non-GAAP measures should not be considered in isolation or as substitutes for analysis of the Company’s results under GAAP and may not be comparable to other companies’ calculation of such metrics.

The Company cannot reconcile its expected Adjusted Operating EBITDA under "Financial Guidance" without unreasonable effort because certain items that impact net income and other reconciling metrics are out of the Company's control and/or cannot be reasonably predicted at this time. These items include but are not limited to gains (losses) on sale of assets, shareholder activism related costs, business divestiture costs, employee separation costs, N&B inventory step-up costs, N&B transaction related costs, integration related costs and the impact of the merger with N&B.

Welcome to IFF

At IFF (NYSE: IFF), an industry leader in food, beverage, scent, health and biosciences, science and creativity meet to create essential solutions for a better world – from global icons to unexpected innovations and experiences. With the beauty of art and the precision of science, we are an international collective of thinkers who partners with customers to bring scents, tastes, experiences, ingredients and solutions for products the world craves. Together, we will do more good for people and planet. Learn more at iff.com, Twitter, Facebook, Instagram, and LinkedIn.

International Flavors & Fragrances Inc.

Consolidated Income (Loss) Statements

(Amounts in millions except per share data)

(Unaudited)

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

2022

 

 

2021

 

% Change

 

 

2022

 

 

2021

 

% Change

Net sales

$

3,307

 

$

3,089

 

7 %

 

$

6,533

 

$

5,554

 

18 %

Cost of goods sold

 

2,171

 

 

2,179

 

— %

 

 

4,252

 

 

3,890

 

9 %

Gross profit

 

1,136

 

 

910

 

25 %

 

 

2,281

 

 

1,664

 

37 %

Research and development expenses

 

158

 

 

164

 

(4) %

 

 

315

 

 

307

 

3 %

Selling and administrative expenses

 

456

 

 

412

 

11 %

 

 

915

 

 

863

 

6 %

Amortization of acquisition-related intangibles

 

184

 

 

200

 

(8) %

 

 

370

 

 

352

 

5 %

Impairment of long-lived assets

 

120

 

 

 

NMF

 

 

120

 

 

 

NMF

Restructuring and other charges

 

7

 

 

24

 

(71) %

 

 

9

 

 

28

 

(68) %

Gains on sales of fixed assets

 

(2)

 

 

 

NMF

 

 

(2)

 

 

 

NMF

Operating profit

 

213

 

 

110

 

94 %

 

 

554

 

 

114

 

NMF

Interest expense

 

77

 

 

77

 

— %

 

 

149

 

 

142

 

5 %

Other expense (income), net

 

6

 

 

(11)

 

(155) %

 

 

(10)

 

 

(18)

 

(44) %

Income (loss) before taxes

 

130

 

 

44

 

195 %

 

 

415

 

 

(10)

 

NMF

Provision for income taxes

 

21

 

 

14

 

50 %

 

 

60

 

 

 

NMF

Net income (loss)

 

109

 

 

30

 

263 %

 

 

355

 

 

(10)

 

NMF

Net income attributable to noncontrolling interests

 

2

 

 

2

 

— %

 

 

4

 

 

4

 

— %

Net income (loss) attributable to IFF shareholders

$

107

 

$

28

 

282 %

 

$

351

 

$

(14)

 

NMF

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share - basic (1)

$

0.43

 

$

0.11

 

 

 

$

1.38

 

$

(0.06)

 

 

Net income (loss) per share - diluted (1)

$

0.43

 

$

0.11

 

 

 

$

1.38

 

$

(0.06)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average number of shares outstanding - basic

 

255

 

 

254

 

 

 

 

255

 

 

230

 

 

Average number of shares outstanding - diluted

 

255

 

 

255

 

 

 

 

255

 

 

230

 

 

(1)

For 2022 and 2021, net income (loss) per share reflects adjustments related to the redemption value of certain redeemable noncontrolling interests.
NMF Not meaningful

International Flavors & Fragrances Inc.

Condensed Consolidated Balance Sheets

(Amounts in millions)

(Unaudited)

 

 

June 30,

 

December 31,

 

2022

 

2021

Cash, cash equivalents, and restricted cash

$

573

 

$

715

Receivables, net

 

2,180

 

 

1,906

Inventories

 

2,993

 

 

2,516

Other current assets

 

1,984

 

 

1,850

Total current assets

 

7,730

 

 

6,987

 

 

 

 

Property, plant and equipment, net

 

4,177

 

 

4,368

Goodwill and other intangibles, net

 

25,938

 

 

26,920

Other assets

 

1,459

 

 

1,383

Total assets

$

39,304

 

$

39,658

 

 

 

 

Short-term borrowings

$

1,749

 

$

632

Other current liabilities

 

2,971

 

 

3,001

Total current liabilities

 

4,720

 

 

3,633

 

 

 

 

Long-term debt

 

10,363

 

 

10,768

Non-current liabilities

 

3,842

 

 

4,035

 

 

 

 

Redeemable noncontrolling interests

 

86

 

 

105

 

 

 

 

Shareholders' equity

 

20,293

 

 

21,117

Total liabilities and shareholders' equity

$

39,304

 

$

39,658

International Flavors & Fragrances Inc.

Consolidated Statements of Cash Flows

(Amounts in millions)

(Unaudited)

 

 

Six Months Ended June 30,

 

2022

 

2021

Cash flows from operating activities:

 

 

 

Net income (loss)

$

355

 

$

(10)

Adjustments to reconcile to net cash (used in) provided by operating activities

 

 

 

Depreciation and amortization

 

604

 

 

564

Deferred income taxes

 

(178)

 

 

(137)

(Gains) Losses on sale of assets

 

(2)

 

 

Stock-based compensation

 

25

 

 

27

Pension contributions

 

(17)

 

 

(12)

Amortization of inventory step-up

 

 

 

377

Impairment of long-lived assets

 

120

 

 

Changes in assets and liabilities, net of acquisitions:

 

 

 

Trade receivables

 

(363)

 

 

(205)

Inventories

 

(573)

 

 

(130)

Accounts payable

 

143

 

 

250

Accruals for incentive compensation

 

(62)

 

 

7

Other current payables and accrued expenses

 

(67)

 

 

32

Other assets/liabilities, net

 

(85)

 

 

(65)

Net cash (used in) provided by operating activities

 

(100)

 

 

698

Cash flows from investing activities:

 

 

 

Cash paid for acquisitions, net of cash received

 

(123)

 

 

Additions to property, plant and equipment

 

(236)

 

 

(165)

Additions to intangible assets

 

(2)

 

 

Proceeds from disposal of assets

 

4

 

 

2

Cash provided by the Merger with N&B

 

11

 

 

193

Net cash (used in) provided by investing activities

 

(346)

 

 

30

Cash flows from financing activities:

 

 

 

Cash dividends paid to shareholders

 

(402)

 

 

(274)

Increase (decrease) in revolving credit facility and short-term borrowings

 

351

 

 

(104)

Proceeds from issuance of commercial paper (maturities after three months)

 

160

 

 

Repayments of commercial paper (maturities after three months)

 

(230)

 

 

Net borrowings of commercial paper (maturities less than three months)

 

532

 

 

Repayments of long-term debt

 

 

 

(24)

Contingent consideration paid

 

 

 

(14)

Purchases of redeemable noncontrolling interest

 

(15)

 

 

Purchases of noncontrolling interest

 

(6)

 

 

Proceeds from issuance of long-term debt

 

 

 

3

Proceeds from issuance of stock in connection with stock options

 

7

 

 

5

Employee withholding taxes paid

 

(20)

 

 

(19)

Net cash provided by (used in) financing activities

 

377

 

 

(427)

Effect of exchange rates changes on cash, cash equivalents and restricted cash

 

(74)

 

 

(18)

Net change in cash, cash equivalents and restricted cash

 

(143)

 

 

283

Cash, cash equivalents and restricted cash at beginning of year

 

716

 

 

660

Cash, cash equivalents and restricted cash at end of period

$

573

 

$

943

The following table reconciles cash, cash equivalents and restricted cash between the Company's statement of cash flows for the periods ended June 30, 2022 and June 30, 2021 to the amounts reported in the Company's balance sheet:

AMOUNTS IN MILLIONS

June 30, 2022

 

December 31, 2021

 

June 30, 2021

 

December 31, 2020

Current assets

 

 

 

 

 

 

 

Cash and cash equivalents

$

569

 

$

711

 

$

935

 

$

650

Restricted cash

 

4

 

 

4

 

 

7

 

 

7

Noncurrent assets

 

 

 

 

 

 

 

Restricted cash included in Other assets

 

 

 

1

 

 

1

 

 

3

Cash, cash equivalents and restricted cash

$

573

 

$

716

 

$

943

 

$

660

International Flavors & Fragrances Inc.

Reportable Segment Performance

(Amounts in millions)

(Unaudited)

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2022

 

2021

 

2022

 

2021

Net Sales

 

 

 

 

 

 

 

Nourish

$

1,818

 

$

1,668

 

$

3,549

 

$

2,976

Health & Biosciences

 

665

 

 

639

 

 

1,326

 

 

1,065

Scent

 

580

 

 

550

 

 

1,165

 

 

1,119

Pharma Solutions

 

244

 

 

232

 

 

493

 

 

394

Consolidated

$

3,307

 

$

3,089

 

$

6,533

 

$

5,554

Segment Adjusted Operating EBITDA

 

 

 

 

 

 

 

Nourish

$

365

 

$

324

 

$

694

 

$

594

Health & Biosciences

 

184

 

 

190

 

 

376

 

 

318

Scent

 

93

 

 

117

 

 

209

 

 

245

Pharma Solutions

 

58

 

 

48

 

 

123

 

 

91

Total

 

700

 

 

679

 

 

1,402

 

 

1,248

Depreciation & Amortization

 

(301)

 

 

(322)

 

 

(604)

 

 

(564)

Interest Expense

 

(77)

 

 

(77)

 

 

(149)

 

 

(142)

Other (Expense) Income, net

 

(6)

 

 

11

 

 

10

 

 

18

Acquisition Related Costs

 

(1)

 

 

 

 

(1)

 

 

Restructuring and Other Charges

 

(7)

 

 

(24)

 

 

(9)

 

 

(28)

Gains on sales of fixed assets

 

2

 

 

 

 

2

 

 

Impairment of Long-Lived Assets

 

(120)

 

 

 

 

(120)

 

 

Shareholder Activism Related Costs

 

 

 

 

 

(3)

 

 

(7)

Business Divestiture Costs

 

(30)

 

 

(5)

 

 

(60)

 

 

(5)

Employee Separation Costs

 

 

 

(3)

 

 

(4)

 

 

(6)

Frutarom Acquisition Related Costs

 

 

 

 

 

(1)

 

 

N&B Inventory Step-Up Costs

 

 

 

(195)

 

 

 

 

(377)

N&B Transaction Related Costs

 

 

 

(2)

 

 

 

 

(91)

Integration Related Costs

 

(30)

 

 

(18)

 

 

(48)

 

 

(56)

Income (Loss) Before Taxes

$

130

 

$

44

 

$

415

 

$

(10)

Segment Adjusted Operating EBITDA Margin

 

 

 

 

 

 

 

Nourish

 

20.1 %

 

 

19.4 %

 

 

19.6 %

 

 

20.0 %

Health & Biosciences

 

27.7 %

 

 

29.7 %

 

 

28.4 %

 

 

29.9 %

Scent

 

16.0 %

 

 

21.3 %

 

 

17.9 %

 

 

21.9 %

Pharma Solutions

 

23.8 %

 

 

20.7 %

 

 

24.9 %

 

 

23.1 %

Consolidated

 

21.2 %

 

 

22.0 %

 

 

21.5 %

 

 

22.5 %

International Flavors & Fragrances Inc.

GAAP to Non-GAAP Reconciliation

(Unaudited)

The following information and schedules provide reconciliation information between reported GAAP amounts and non-GAAP certain adjusted amounts. This information and schedules are not intended as, and should not be viewed as, a substitute for reported GAAP amounts or financial statements of the Company prepared and presented in accordance with GAAP.

Reconciliation of Gross Profit

 

Second Quarter

(DOLLARS IN MILLIONS)

 

2022

 

 

2021

Reported (GAAP)

$

1,136

 

$

910

N&B Inventory Step-Up Costs

 

 

 

195

Integration Related Costs (f)

 

1

 

 

Adjusted (Non-GAAP)

$

1,137

 

$

1,105

 

Reconciliation of Selling and Administrative Expenses

 

Second Quarter

(DOLLARS IN MILLIONS)

 

2022

 

 

2021

Reported (GAAP)

$

456

 

$

412

Acquisition Related Costs (a)

 

(1)

 

 

Restructuring and Other Charges

 

 

 

(1)

Business Divestiture Costs (c)

 

(30)

 

 

(5)

Employee Separation Costs (d)

 

 

 

(3)

N&B Transaction Related Costs (e)

 

 

 

(2)

Integration Related Costs (f)

 

(29)

 

 

(17)

Adjusted (Non-GAAP)

$

396

 

$

384

International Flavors & Fragrances Inc.

GAAP to Non-GAAP Reconciliation

(Unaudited)

The following information and schedules provide reconciliation information between reported GAAP amounts and non-GAAP certain adjusted amounts. This information and schedules are not intended as, and should not be viewed as, a substitute for reported GAAP amounts or financial statements of the Company prepared and presented in accordance with GAAP.

Reconciliation of Net Income and EPS

 

Second Quarter

 

2022

 

2021

(DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS)

Income before
taxes

 

Provision
for income taxes (h)

 

Net Income
Attributable
to IFF (i)

 

Diluted
EPS

 

Income
before
taxes

 

Provision
for income
taxes (h)

 

Net Income
Attributable
to IFF (i)

 

Diluted
EPS (j)

Reported (GAAP)

$

130

 

$

21

 

$

107

 

$

0.43

 

$

44

 

$

14

 

$

28

 

$

0.11

Acquisition Related Costs (a)

 

1

 

 

 

 

1

 

 

 

 

 

 

 

 

 

 

Restructuring and Other Charges

 

7

 

 

2

 

 

5

 

 

0.02

 

 

24

 

 

5

 

 

19

 

 

0.07

Gains on Sale of Assets

 

(2)

 

 

(1)

 

 

(1)

 

 

(0.01)

 

 

 

 

 

 

 

 

Impairment of Long-Lived Assets (b)

 

120

 

 

24

 

 

96

 

 

0.38

 

 

 

 

 

 

 

 

Business Divestiture Costs (c)

 

30

 

 

8

 

 

22

 

 

0.09

 

 

5

 

 

1

 

 

4

 

 

0.01

Employee Separation Costs (d)

 

 

 

 

 

 

 

 

 

3

 

 

1

 

 

2

 

 

0.02

N&B Inventory Step-Up Costs

 

 

 

 

 

 

 

 

 

195

 

 

45

 

 

150

 

 

0.59

N&B Transaction Related Costs (e)

 

 

 

 

 

 

 

 

 

2

 

 

1

 

 

1

 

 

Integration Related Costs (f)

 

30

 

 

7

 

 

23

 

 

0.09

 

 

18

 

 

4

 

 

14

 

 

0.05

Redemption value adjustment to EPS (g)

 

 

 

 

 

 

 

(0.01)

 

 

 

 

 

 

 

 

Adjusted (Non-GAAP)

$

316

 

$

61

 

$

253

 

$

0.99

 

$

291

 

$

71

 

$

218

 

$

0.86

Reconciliation of Adjusted (Non-GAAP) EPS ex. Amortization

 

Second Quarter

(DOLLARS AND SHARE AMOUNTS IN MILLIONS)

2022

 

2021

Numerator

 

 

 

Adjusted (Non-GAAP) Net Income

$

253

 

$

218

Amortization of Acquisition related Intangible Assets

 

184

 

 

200

Tax impact on Amortization of Acquisition related Intangible Assets (h)

 

43

 

 

35

Amortization of Acquisition related Intangible Assets, net of tax (k)

 

141

 

 

165

Adjusted (Non-GAAP) Net Income ex. Amortization

$

394

 

$

383

 

 

 

 

Denominator

 

 

 

Weighted average shares assuming dilution (diluted)

 

255

 

 

255

Adjusted (Non-GAAP) EPS ex. Amortization

$

1.54

 

$

1.50

(a)

Represents costs related to the acquisition of Health Wright Products, primarily consulting and legal fees.

(b)

Represents costs related to the impairment of intangible and fixed assets of an asset group that operates primarily in Russia.

(c)

Represents costs related to the Company's planned sales of businesses, primarily legal and professional fees.

(d)

Represents costs related to severance, including accelerated stock compensation expense, for certain employees and executives who have been separated or will separate from the Company.

(e)

Represents transaction costs and expenses related to the transaction with N&B, primarily includes legal and professional fees.

(f)

Represents costs related to integration activities since 2018, primarily for Frutarom and N&B. For 2022, represents costs primarily related to external consulting fees and internal integration costs, including salaries of individuals who are fully dedicated to integration efforts. For 2021, represents costs primarily related to performance stock awards and consulting fees for advisory services.

(g)

Represents the adjustment to EPS related to the excess of the redemption value of certain redeemable noncontrolling interests over their existing carrying value.

(h)

The income tax effects of non-GAAP adjustments are calculated based on the applicable statutory tax rate for the relevant jurisdiction, except for those items which are non-taxable or subject to valuation allowances for which the tax expense (benefit) was calculated at 0%. The tax benefit for amortization is calculated in a similar manner as the tax effects of the non-GAAP adjustments.

(i)

For 2022 and 2021, net income is reduced by income attributable to noncontrolling interest of $2 million.

(j)

The sum of these items does not foot due to rounding.

(k)

Represents all amortization of intangible assets acquired in connection with acquisitions, net of tax.

International Flavors & Fragrances Inc.

GAAP to Non-GAAP Reconciliation

(Unaudited)

The following information and schedules provide reconciliation information between reported GAAP amounts and non-GAAP certain adjusted amounts. This information and schedules are not intended as, and should not be viewed as, a substitute for reported GAAP amounts or financial statements of the Company prepared and presented in accordance with GAAP.

Reconciliation of Gross Profit

 

Second Quarter Year-to-Date

(DOLLARS IN MILLIONS)

2022

2021

Reported (GAAP)

$

2,281

$

1,664

N&B Inventory Step-Up Costs

 

 

377

Integration Related Costs (h)

 

2

 

Adjusted (Non-GAAP)

$

2,283

$

2,041

 

Reconciliation of Selling and Administrative Expenses

Second Quarter Year-to-Date

(DOLLARS IN MILLIONS)

2022

 

2021

Reported (GAAP)

$

915

 

$

863

Acquisition Related Costs (a)

 

(1)

 

 

Restructuring and Other Charges

 

 

 

(1)

Shareholder Activism Related Costs (c)

 

(3)

 

 

(7)

Business Divestiture Costs (d)

 

(60)

 

 

(5)

Employee Separation Costs (e)

 

(4)

 

 

(6)

Frutarom Acquisition Related Costs (f)

 

(1)

 

 

N&B Transaction Related Costs (g)

 

 

 

(91)

Integration Related Costs (h)

 

(46)

 

 

(55)

Adjusted (Non-GAAP)

$

800

 

$

698

International Flavors & Fragrances Inc.

GAAP to Non-GAAP Reconciliation

(Unaudited)

The following information and schedules provide reconciliation information between reported GAAP amounts and non-GAAP certain adjusted amounts. This information and schedules are not intended as, and should not be viewed as, a substitute for reported GAAP amounts or financial statements of the Company prepared and presented in accordance with GAAP.

Reconciliation of Net Income (Loss) and EPS

 

Second Quarter Year-to-Date

 

2022

 

2021

(DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS)

Income
before
taxes

 

Provision
for
income
taxes (j)

 

Net Income
Attributable
to IFF (k)

 

Diluted
EPS (l)

 

(Loss)
Income
before
taxes

 

Provision
for income
taxes (j)

 

Net (Loss)
Income
Attributable
to IFF (k)

 

Diluted
EPS

Reported (GAAP)

$

415

 

$

60

 

$

351

 

$

1.38

 

$

(10)

 

$

 

$

(14)

 

$

(0.06)

Acquisition Related Costs (a)

 

1

 

 

 

 

1

 

 

 

 

 

 

 

 

 

 

Restructuring and Other Charges

 

9

 

 

2

 

 

7

 

 

0.03

 

 

28

 

 

6

 

 

22

 

 

0.10

Gains on Sale of Assets

 

(2)

 

 

(1)

 

 

(1)

 

 

(0.01)

 

 

 

 

 

 

 

 

Impairment of Long-Lived Assets (b)

 

120

 

 

24

 

 

96

 

 

0.38

 

 

 

 

 

 

 

 

Shareholder Activism Related Costs (c)

 

3

 

 

1

 

 

2

 

 

0.01

 

 

7

 

 

2

 

 

5

 

 

0.02

Business Divestiture Costs (d)

 

60

 

 

15

 

 

45

 

 

0.18

 

 

5

 

 

1

 

 

4

 

 

0.02

Employee Separation Costs (e)

 

4

 

 

1

 

 

3

 

 

0.01

 

 

6

 

 

1

 

 

5

 

 

0.02

Frutarom Acquisition Related Costs (f)

 

1

 

 

 

 

1

 

 

 

 

 

 

 

 

 

 

N&B Inventory Step-Up Costs

 

 

 

 

 

 

 

 

 

377

 

 

82

 

 

295

 

 

1.28

N&B Transaction Related Costs (g)

 

 

 

 

 

 

 

 

 

91

 

 

19

 

 

72

 

 

0.30

Integration Related Costs (h)

 

48

 

 

12

 

 

36

 

 

0.14

 

 

56

 

 

13

 

 

43

 

 

0.19

Redemption value adjustment to EPS (i)

 

 

 

 

 

 

 

(0.01)

 

 

 

 

 

 

 

 

Adjusted (Non-GAAP)

$

659

 

$

114

 

$

541

 

$

2.12

 

$

560

 

$

124

 

$

432

 

$

1.87

Reconciliation of Adjusted (Non-GAAP) EPS ex. Amortization

 

Second Quarter Year-to-Date

(DOLLARS AND SHARE AMOUNTS IN MILLIONS)

2022

 

2021

Numerator

 

 

 

Adjusted (Non-GAAP) Net Income

$

541

 

$

432

Amortization of Acquisition related Intangible Assets

 

370

 

 

352

Tax impact on Amortization of Acquisition related Intangible Assets (j)

 

86

 

 

69

Amortization of Acquisition related Intangible Assets, net of tax (m)

 

284

 

 

283

Adjusted (Non-GAAP) Net Income ex. Amortization

$

825

 

$

715

 

 

 

 

Denominator

 

 

 

Weighted average shares assuming dilution (diluted)

 

255

 

 

231

Adjusted (Non-GAAP) EPS ex. Amortization

$

3.23

 

$

3.09

(a)

Represents costs related to the acquisition of Health Wright Products, primarily consulting and legal fees.

(b)

Represents costs related to the impairment of intangible and fixed assets of an asset group that operates primarily in Russia.

(c)

Represents shareholder activist related costs, primarily professional fees.

(d)

Represents costs related to the Company's planned sales of businesses, primarily legal and professional fees.

(e)

Represents costs related to severance, including accelerated stock compensation expense, for certain employees and executives who have been separated or will separate from the Company.

(f)

Represents transaction-related costs and expenses related to the acquisition of Frutarom.

(g)

Represents transaction costs and expenses related to the transaction with N&B, primarily includes legal and professional fees.

(h)

Represents costs related to integration activities since 2018, primarily for Frutarom and N&B. For 2022, represents costs primarily related to external consulting fees and internal integration costs, including salaries of individuals who are fully dedicated to integration efforts. For 2021, represents costs primarily related to performance stock awards and consulting fees for advisory services.

(i)

Represents the adjustment to EPS related to the excess of the redemption value of certain redeemable noncontrolling interests over their existing carrying value.

(j)

The income tax effects of non-GAAP adjustments are calculated based on the applicable statutory tax rate for the relevant jurisdiction, except for those items which are non-taxable or subject to valuation allowances for which the tax expense (benefit) was calculated at 0%. The tax benefit for amortization is calculated in a similar manner as the tax effects of the non-GAAP adjustments.

(k)

For 2022, net income is reduced by income attributable to noncontrolling interest of $4 million. For 2021, net loss is increased by income attributable to noncontrolling interest of $4 million.

(l)

The sum of these items does not foot due to rounding.

(m)

Represents all amortization of intangible assets acquired in connection with acquisitions, net of tax.

International Flavors & Fragrances Inc.

Debt Covenants

(Amounts in millions)

(Unaudited)

The following information and schedules provide reconciliation information between reported GAAP amounts and non-GAAP certain adjusted amounts. This information and schedules are not intended as, and should not be viewed as, a substitute for reported GAAP amounts or financial statements of the Company prepared and presented in accordance with GAAP.

Reconciliation of Credit Adjusted EBITDA to Net Income

(DOLLARS IN MILLIONS)

Twelve Months Ended June
30, 2022

Net income

$

635

Interest expense

 

296

Income taxes

 

135

Depreciation and amortization

 

1,196

Specified items(1)

 

346

Non-cash items(2)

 

36

Credit Adjusted EBITDA

$

2,644

_______________________

(1)

Specified items for the 12 months ended June 30, 2022 of $346 million consisted of acquisition related costs, restructuring and other charges, impairment of long-lived assets, shareholder activism related costs, business divestiture costs, employee separation costs, pension income adjustment, pension settlement, Frutarom acquisition related costs, N&B inventory step-up costs and integration related costs.

(2)

Non-cash items represent all other adjustments to reconcile net income to net cash provided by operations as presented on the Statements of Cash Flows, including gains on disposal of assets, gains on business disposal and stock-based compensation.

Net Debt to Total Debt

(DOLLARS IN MILLIONS)

June 30, 2022

Total debt(1)

$

12,150

Adjustments:

 

Cash and cash equivalents

 

569

Net debt

$

11,581

_______________________

(1)

Total debt used for the calculation of net debt consists of short-term debt, long-term debt, short-term finance lease obligations and long-term finance lease obligations.

International Flavors & Fragrances Inc.

Comparable Reportable Segment Performance

(Amounts in millions)

(Unaudited)

The following information and schedule provides reconciliation information between reported GAAP amounts and non-GAAP certain adjusted amounts. This information and schedule is not intended as, and should not be viewed as, a substitute for reported GAAP amounts or financial statements of the Company prepared and presented in accordance with GAAP.

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2022

 

2021

 

2022

 

2021

Net Sales

 

 

 

 

 

 

 

Nourish(1)

$

1,818

 

$

1,650

 

$

3,549

 

$

3,187

Health & Biosciences(2)

 

639

 

 

639

 

 

1,300

 

 

1,254

Scent

 

580

 

 

550

 

 

1,165

 

 

1,119

Pharma Solutions

 

244

 

 

232

 

 

493

 

 

465

Consolidated

$

3,281

 

$

3,071

 

$

6,507

 

$

6,025

Segment Adjusted Operating EBITDA

 

 

 

 

 

 

 

Nourish(1)

$

365

 

$

321

 

$

694

 

$

625

Health & Biosciences(2)

 

182

 

 

190

 

 

374

 

 

371

Scent

 

93

 

 

117

 

 

209

 

 

245

Pharma Solutions

 

58

 

 

48

 

 

123

 

 

108

Total

 

698

 

 

676

 

 

1,400

 

 

1,349

Depreciation & Amortization

 

(301)

 

 

(322)

 

 

(604)

 

 

(564)

Interest Expense

 

(77)

 

 

(77)

 

 

(149)

 

 

(142)

Other (Expense) Income, net

 

(6)

 

 

11

 

 

10

 

 

18

Acquisition Related Costs

 

(1)

 

 

 

 

(1)

 

 

Restructuring and Other Charges

 

(7)

 

 

(24)

 

 

(9)

 

 

(28)

Gains on sales of fixed assets

 

2

 

 

 

 

2

 

 

Impairment of Long-Lived Assets

 

(120)

 

 

 

 

(120)

 

 

Shareholder Activism Related Costs

 

 

 

 

 

(3)

 

 

(7)

Business Divestiture Costs

 

(30)

 

 

(5)

 

 

(60)

 

 

(5)

Employee Separation Costs

 

 

 

(3)

 

 

(4)

 

 

(6)

Frutarom Acquisition Related Costs

 

 

 

 

 

(1)

 

 

N&B Inventory Step-Up Costs

 

 

 

(195)

 

 

 

 

(377)

N&B Transaction Related Costs

 

 

 

(2)

 

 

 

 

(91)

Integration Related Costs

 

(30)

 

 

(18)

 

 

(48)

 

 

(56)

Divestiture of Businesses(3)

 

 

 

3

 

 

 

 

6

Impact of Business Acquisitions(4)

 

2

 

 

 

 

2

 

 

Impact of Merger with N&B(5)

 

 

 

 

 

 

 

(107)

Income (Loss) Before Taxes

$

130

 

$

44

 

$

415

 

$

(10)

Segment Adjusted Operating EBITDA Margin

 

 

 

 

 

 

 

Nourish

 

20.1 %

 

 

19.5 %

 

 

19.6 %

 

 

19.6 %

Health & Biosciences

 

28.5 %

 

 

29.7 %

 

 

28.8 %

 

 

29.6 %

Scent

 

16.0 %

 

 

21.3 %

 

 

17.9 %

 

 

21.9 %

Pharma Solutions

 

23.8 %

 

 

20.7 %

 

 

24.9 %

 

 

23.2 %

Consolidated

 

21.3 %

 

 

22.0 %

 

 

21.5 %

 

 

22.4 %

______________________

(1)

Nourish sales and segment adjusted operating EBITDA information for the three and six months ended June 30, 2021 exclude the results of the Fruit Preparation business to present fully comparable scenarios of the Company due to divestiture of the business in the fourth quarter of 2021. As a result, there is no impact of the Fruit Preparation business for the 2022 period.

(2)

Health & Biosciences sales and segment adjusted operating EBITDA information for the three and six months ended June 30, 2022 exclude the results of Health Wright Products to present fully comparable scenarios of the Company as the acquisition of Health Wright Products was completed on April 1, 2022. As a result, there was no impact from Health Wright Products for the 2021 period.

(3)

Information related to the amounts exclude the results of the Fruit Preparation business to present fully comparable scenarios of the Company due to divestiture of the business in the fourth quarter of 2021.

(4)

Information related to the amounts exclude the results of Health Wright Products to present fully comparable scenarios of the Company as the acquisition of Health Wright Products was completed on April 1, 2022.

(5)

Information related to the amounts included from merger with N&B was received directly from DuPont and management believes such information is reliable. DuPont has not provided the underlying adjustments for the amounts included, but based on management's review of financial statement and other scheduled information provided, we believe the amounts reflected are reasonable. For the six months ended June 30, 2021, amounts include N&B results for January 2021 to reflect the same period N&B is included in IFF results in 2022.

The pro forma historical segment information has been presented for informational purposes only and is not necessarily indicative of what IFF's results of operations actually would have been, had the N&B transaction occurred on the date indicated below. In addition, the pro forma historical segment information does not purport to project the future operating results of the Company, shown below:

(DOLLARS IN MILLIONS)

January 2021

 

Pro Forma Sales

 

Pro Forma Adjusted
Operating EBITDA

Nourish

$

247

 

$

37

Health & Biosciences

 

189

 

 

53

Scent

 

 

 

Pharma Solutions

 

71

 

 

17

International Flavors & Fragrances Inc.
GAAP to Non-GAAP Reconciliation
Comparable Foreign Exchange Impact
(Unaudited)

 

Q2 Nourish

 

Sales

 

Segment Adjusted
Operating EBITDA

 

Segment Adjusted
Operating EBITDA Margin

% Change - Comparable

 

10%

 

14%

 

0.6%

Currency Impact

 

5%

 

4%

 

0.0%

% Change - Currency Neutral

 

15%

 

18%

 

0.6%

 

 

 

 

 

 

 

Q2 Health & Biosciences

 

Sales

 

Segment Adjusted
Operating EBITDA

 

Segment Adjusted
Operating EBITDA Margin

% Change - Comparable

 

0%

 

(4)%

 

(1.3)%

Currency Impact

 

4%

 

2%

 

(0.3)%

% Change - Currency Neutral

 

4%

 

(2)%

 

(1.6)%

 

 

 

 

 

 

 

Q2 Scent

 

Sales

 

Segment Adjusted
Operating EBITDA

 

Segment Adjusted
Operating EBITDA Margin

% Change - Comparable

 

5%

 

(21)%

 

(5.2)%

Currency Impact

 

4%

 

4%

 

0.0%

% Change - Currency Neutral

 

9%

 

(17)%

 

(5.2)%

 

 

 

 

 

 

 

Q2 Pharma Solutions

 

Sales

 

Segment Adjusted
Operating EBITDA

 

Segment Adjusted
Operating EBITDA Margin

% Change - Comparable

 

5%

 

21%

 

3.1%

Currency Impact

 

5%

 

4%

 

(0.3)%

% Change - Currency Neutral

 

10%

 

25%

 

2.8%

 

 

 

 

 

 

 

Q2 Consolidated

 

Sales

 

Adjusted Operating
EBITDA

 

Adjusted Operating
EBITDA Margin

% Change - Comparable

 

7%

 

3%

 

(0.7)%

Currency Impact

 

4%

 

4%

 

(0.1)%

% Change - Currency Neutral

 

11%

 

7%

 

(0.8)%

 

 

 

 

 

 

 

YTD Nourish

 

Sales

 

Segment Adjusted
Operating EBITDA

 

Segment Adjusted
Operating EBITDA Margin

% Change - Comparable

 

11%

 

11%

 

(0.1)%

Currency Impact

 

4%

 

5%

 

0.2%

% Change - Currency Neutral

 

15%

 

16%

 

0.1%

 

 

 

 

 

 

 

YTD Health & Biosciences

 

Sales

 

Segment Adjusted
Operating EBITDA

 

Segment Adjusted
Operating EBITDA Margin

% Change - Comparable

 

4%

 

1%

 

(0.8)%

Currency Impact

 

3%

 

2%

 

(0.2)%

% Change - Currency Neutral

 

7%

 

3%

 

(1.0)%

 

 

 

 

 

 

 

YTD Scent

 

Sales

 

Segment Adjusted
Operating EBITDA

 

Segment Adjusted
Operating EBITDA Margin

% Change - Comparable

 

4%

 

(15)%

 

(4.0)%

Currency Impact

 

4%

 

6%

 

0.5%

% Change - Currency Neutral

 

8%

 

(9)%

 

(3.5)%

 

 

 

 

 

 

 

YTD Pharma Solutions

 

Sales

 

Segment Adjusted
Operating EBITDA

 

Segment Adjusted
Operating EBITDA Margin

% Change - Comparable

 

6%

 

14%

 

1.7%

Currency Impact

 

4%

 

2%

 

(0.3)%

% Change - Currency Neutral

 

10%

 

16%

 

1.4%

 

 

 

 

 

 

 

YTD Consolidated

 

Sales

 

Adjusted Operating
EBITDA

 

Adjusted Operating
EBITDA Margin

% Change - Comparable

 

8%

 

4%

 

(0.9)%

Currency Impact

 

4%

 

4%

 

0.1%

% Change - Currency Neutral

 

12%

 

8%

 

(0.8)%

 

 

 

 

 

 

 

 

Michael DeVeau
Chief Investor Relations & Communications Officer
212.708.7164
Michael.DeVeau@iff.com

Source: International Flavors & Fragrances Inc.