IFF Reports Second Quarter 2023 Results
Strong Top- and Bottom-Line Growth in Scent and Pharma Solutions; Demand Softness Primarily Driven by Customer Destocking in Functional Ingredients
Strengthening Capital Structure Through Working Capital Improvements and Portfolio Optimization; Launching Sale Process for Lucas Meyer Cosmetics and Exploring Additional Strategic Pathways to Unlock Value for Shareholders
IFF Declares Dividend for Third Quarter 2023
Second Quarter 2023 Consolidated Summary:
Reported (GAAP) |
|
Adjusted (Non-GAAP)1 |
||||||||
Sales |
|
Income Before Taxes |
|
EPS |
|
Operating EBITDA |
|
Operating EBITDA Margin |
|
EPS ex Amortization |
|
|
|
|
|
|
|
|
17.4% |
|
|
First Six Months 2023 Consolidated Summary:
Reported (GAAP) |
|
Adjusted (Non-GAAP)1 |
||||||||
Sales |
|
Income Before Taxes |
|
EPS |
|
Operating EBITDA |
|
Operating EBITDA Margin |
|
EPS ex Amortization |
|
|
|
|
17.0% |
|
Management Commentary
“Amid the current operating environment, IFF has performed near expectations across the majority of our portfolio, led by strong top- and bottom-line results in Scent and Pharma Solutions," said IFF CEO
Clyburn continued, “We have broadened our portfolio optimization efforts – launching the sale process for our Lucas Meyer Cosmetics business – and hired an external advisor to explore additional strategic pathways to maximize shareholder returns. We are also taking decisive action to improve Functional Ingredients through an operational improvement plan to accelerate sales and expand margin for this business. I am encouraged by the progress our team is making and remain confident in the long-term value potential of IFF.”
Second Quarter 2023 Consolidated Financial Results
-
Reported net sales for the second quarter were
$2.93 billion , flat versus the prior-year period. On a comparable basis2, currency neutral sales decreased 4% versus the prior-year period, as continued growth in Scent and Pharma Solutions were more than offset by softness in Nourish & Health & Biosciences. Pricing continues to be strong, increasing high- single digits year-over-year, and volume was pressured primarily related to destocking, declining low double-digits versus the year-ago period. Approximately 60% of the total volume decline was due to a more than 20% volume decline in the Functional Ingredients business. IFF volume performance was down mid-single digits in the second quarter 2023, excluding the impact of Functional Ingredients. -
Income before taxes on a reported basis for the second quarter was
$50 million . Adjusted operating EBITDA for the second quarter was$510 million . On a comparable basis2, currency neutral adjusted operating EBITDA declined 18% versus the prior-year period, as strong pricing and productivity gains were more than offset by lower volumes, unfavorable manufacturing absorption related to the Company's inventory improvement program and a$44 million one-time write-down of inventory related to unprecedented cost fluctuations for Locust Bean Kernel (LBK). Excluding the one-time inventory write-down, adjusted operating EBITDA for the quarter was within the previously forecasted guidance range of$540 million to$590 million . -
Reported earnings per share (EPS) for the second quarter was
$0.11 . Adjusted EPS excluding amortization was$0.86 per diluted share. -
Cash flows from operations at the end of the second quarter was
$375 million , and free cash flow defined as cash flows from operations less capital expenditures totaled$85 million . This cash flow performance was driven by more than$150 million reduction in inventory versus the first quarter 2023. Net debt to credit adjusted EBITDA at the end of the second quarter was 4.5x.
Second Quarter 2023 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 |
(14)% |
|
(50)% |
|
(9)% |
|
(42)% |
Health & Biosciences |
(22)% |
|
(21)% |
|
(3)% |
|
(9)% |
Scent |
2% |
|
26% |
|
5% |
|
41% |
Pharma Solutions |
3% |
|
16% |
|
3% |
|
16% |
Nourish Segment
-
On a reported basis, second quarter sales were
$1.56 billion . On a comparable basis2, currency neutral sales decreased 9% primarily driven by a more than 20% decline in Functional Ingredients volume. Flavors and Food Design were resilient in the challenging operating environment, down modestly versus the prior-year period. -
Nourish adjusted operating EBITDA was
$181 million and adjusted operating EBITDA margin was 11.6% in the second quarter. On a comparable basis2, currency neutral adjusted operating EBITDA declined 42% as price increases and productivity gains were more than offset by lower volumes, unfavorable manufacturing absorption related to the Company's inventory reduction program and a write-down of inventory related to LBK.
Health & Biosciences Segment
-
On a reported basis, second quarter sales were
$522 million . On a comparable basis2, currency neutral sales decreased 3% as growth in Cultures & Food Enzymes, Grain Processing and Home & Personal Care was more than offset primarily by weakness in Health as a result of soft market conditions inNorth America andChina . -
Health & Biosciences adjusted operating EBITDA was
$145 million and adjusted operating EBITDA margin was 27.8% in the second quarter. On a comparable basis2, currency neutral adjusted operating EBITDA declined 9% as price increases and productivity gains were more than offset by lower volumes and unfavorable manufacturing absorption related to the Company's inventory reduction program.
Scent Segment
-
On a reported basis, second quarter sales were
$592 million . On a comparable basis2, currency neutral sales increased 5% led by double-digit growth in Consumer Fragrance and a high-single digit increase in Fine Fragrance, with balanced contributions from volume and price. -
Scent adjusted operating EBITDA was
$117 million and adjusted operating EBITDA margin was 19.8% in the second quarter. On a comparable basis2, currency neutral adjusted operating EBITDA increased a very strong 41% led by net favorable price to inflation and productivity gains.
Pharma Solutions Segment
-
On a reported basis, second quarter sales were
$251 million . On a comparable basis2, currency neutral sales increased 3% led by strong growth in Core Pharma. -
Pharma Solutions adjusted operating EBITDA was
$67 million and adjusted operating EBITDA margin was 26.7% in the second quarter. On a comparable basis2, currency neutral adjusted operating EBITDA increased 16% driven by pricing and productivity gains.
Portfolio Optimization Initiatives
At its 2022 Investor Day, IFF outlined its approach to portfolio management and the characterization of the portfolio within three categories: Invest, Maximize and Optimize. IFF has been focused on maximizing the value of the portfolio along those parameters and has taken a range of proactive steps to position IFF for long-term success. Consistent with this framework, as well as a best-owner mindset, the Company has successfully completed the divestitures of its Microbial Control, Savory Solutions and Flavor Specialty Ingredients businesses, and taken the decision to launch a sale process for its Cosmetic Ingredients business or Lucas Meyer Cosmetics.
In connection with its strategy to prioritize its most synergistic and highest-value businesses and achieve its deleveraging targets, IFF has hired J.P. Morgan to explore additional divestiture actions within the portfolio as a pathway to unlock further value creation for its shareholders.
Functional Ingredients Operational Improvement Plan
IFF continues to execute a series of strategic transformation initiatives and is taking additional actions to rapidly improve the performance of its Functional Ingredients business. Based on the characteristics of this business, and with new management in place, the Company will (1) enhance its go-to-market approach by increasing commercial resources and focusing on key global accounts to accelerate sales growth; (2) strengthen its operating model by delivering 2 to 4% of annual productivity through operational efficiencies; and (3) reshape the product portfolio by focusing on the Company's strongest product lines and discontinuing those that are underperforming. The Company expects that these actions will translate into low single digit comparable currency neutral sales growth – in line with market – and a mid-teen adjusted operating EBITDA margin over the next three years, with a strong improvement in 2024.
The Company will also begin reporting separate business results for the Functional Ingredients business unit in the first quarter of 2024, at the same time that IFF begins reporting according to its previously announced Food & Beverage, Home & Personal Care and Health divisional structure.
With estimated 2023 annual revenue of approximately
Quarterly Dividend
On
Financial Guidance
The Company expects full year 2023 sales to be in the range of
The Company expects full year 2023 adjusted operating EBITDA to be in the range of
IFF remains focused on achieving its targeted full-year working capital improvement. As such, the revised full year adjusted operating EBITDA guidance now includes approximately
Based on current market foreign exchange rates, the Company expects that foreign exchange will have approximately 2% adverse impact to sales growth and approximately a 6% adverse impact to adjusted operating EBITDA growth in 2023.
The Company cannot reconcile its expected adjusted operating EBITDA 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 acquisition, divestiture and integration related costs, gains (losses) on business disposals, and regulatory costs.
Audio Webcast
A live webcast to discuss the Company’s second quarter 2023 financial results will be held on
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 2023, including the impact of foreign exchange, pricing actions, raw materials, energy 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; expectations regarding the implementation of our refreshed growth-focused strategy; expectations around our business divestitures and the progress of our portfolio optimization strategy (including the exploration of strategic alternatives for our Cosmetic Ingredients business), through non-core business divestitures and acquisitions; 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; the success of our optimization of our portfolio; the impact of global economic uncertainty or recessionary pressures on demand for consumer products; the growth potential of the markets in which we operate, including the emerging markets; expected capital expenditures in 2023; 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 drive reductions in expenses; our strategic investments in capacity and increasing inventory to drive improved profitability; our ability to innovate and execute on specific consumer trends and demands; our ability enhance our innovation efforts and drive cost efficiencies; 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, including in the price of our input costs, such as raw materials, transportation and energy; (2) supply chain disruptions, geopolitical developments, including the
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
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
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-
Adjusted operating EBITDA and adjusted operating EBITDA margin exclude depreciation and amortization expense, interest expense, other (expense) income, net, and certain non-recurring or unusual items that are not part of recurring operations such as, restructuring and other charges, acquisition, divestiture, and integration related costs, gains (losses) on business disposals, strategic initiatives costs, regulatory costs, and other items.
Adjusted EPS ex Amortization excludes the impact of non-operational items including, restructuring and other charges, acquisition, divestiture, and integration related costs, gains (losses) on business disposals, strategic initiatives costs, regulatory costs, and other items that are not a part of recurring operations.
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 exclude the impact of divestitures and acquisitions.
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 acquisition, divestiture and integration related costs, gains (losses) on business disposals, and regulatory costs.
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.
_______________________ | |
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 and acquisitions. |
|
|||||||||||||||||||
Consolidated Statements of Income |
|||||||||||||||||||
(Amounts in millions except per share data) |
|||||||||||||||||||
(Unaudited) |
|||||||||||||||||||
|
Three Months Ended |
|
Six Months Ended |
||||||||||||||||
|
|
2023 |
|
|
|
2022 |
|
|
% Change |
|
|
2023 |
|
|
|
2022 |
|
|
% Change |
Net sales |
$ |
2,929 |
|
|
$ |
3,307 |
|
|
(11)% |
|
$ |
5,956 |
|
|
$ |
6,533 |
|
|
(9)% |
Cost of goods sold |
|
1,996 |
|
|
|
2,171 |
|
|
(8)% |
|
|
4,059 |
|
|
|
4,252 |
|
|
(5)% |
Gross profit |
|
933 |
|
|
|
1,136 |
|
|
(18)% |
|
|
1,897 |
|
|
|
2,281 |
|
|
(17)% |
Research and development expenses |
|
161 |
|
|
|
158 |
|
|
2% |
|
|
322 |
|
|
|
315 |
|
|
2% |
Selling and administrative expenses |
|
445 |
|
|
|
456 |
|
|
(2)% |
|
|
899 |
|
|
|
915 |
|
|
(2)% |
Amortization of acquisition-related intangibles |
|
172 |
|
|
|
184 |
|
|
(7)% |
|
|
343 |
|
|
|
370 |
|
|
(7)% |
Impairment of long-lived assets |
|
— |
|
|
|
120 |
|
|
(100)% |
|
|
— |
|
|
|
120 |
|
|
(100)% |
Restructuring and other charges |
|
7 |
|
|
|
7 |
|
|
—% |
|
|
59 |
|
|
|
9 |
|
|
NMF |
Losses (gains) on sale of assets |
|
3 |
|
|
|
(2 |
) |
|
(250)% |
|
|
(2 |
) |
|
|
(2 |
) |
|
—% |
Operating profit |
|
145 |
|
|
|
213 |
|
|
(32)% |
|
|
276 |
|
|
|
554 |
|
|
(50)% |
Interest expense |
|
116 |
|
|
|
77 |
|
|
51% |
|
|
227 |
|
|
|
149 |
|
|
52% |
Other (income) expense, net |
|
(21 |
) |
|
|
6 |
|
|
NMF |
|
|
(15 |
) |
|
|
(10 |
) |
|
50% |
Income before taxes |
|
50 |
|
|
|
130 |
|
|
(62)% |
|
|
64 |
|
|
|
415 |
|
|
(85)% |
Provision for income taxes |
|
23 |
|
|
|
21 |
|
|
10% |
|
|
45 |
|
|
|
60 |
|
|
(25)% |
Net income |
|
27 |
|
|
|
109 |
|
|
(75)% |
|
|
19 |
|
|
|
355 |
|
|
(95)% |
Net income attributable to non-controlling interests |
|
— |
|
|
|
2 |
|
|
(100)% |
|
|
1 |
|
|
|
4 |
|
|
(75)% |
Net income attributable to IFF shareholders |
$ |
27 |
|
|
$ |
107 |
|
|
(75)% |
|
$ |
18 |
|
|
$ |
351 |
|
|
(95)% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income per share - basic(1) |
$ |
0.11 |
|
|
$ |
0.43 |
|
|
|
|
$ |
0.07 |
|
|
$ |
1.38 |
|
|
|
Net income per share - diluted(1) |
$ |
0.11 |
|
|
$ |
0.43 |
|
|
|
|
$ |
0.07 |
|
|
$ |
1.38 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Average number of shares outstanding - basic |
|
255 |
|
|
|
255 |
|
|
|
|
|
255 |
|
|
|
255 |
|
|
|
Average number of shares outstanding - diluted |
|
255 |
|
|
|
255 |
|
|
|
|
|
255 |
|
|
|
255 |
|
|
|
(1) |
For 2023 and 2022, net income per share reflects adjustments related to the redemption value of certain redeemable non-controlling interests. |
|
NMF Not meaningful | ||
|
|||||
Condensed Consolidated Balance Sheets |
|||||
(Amounts in millions) |
|||||
(Unaudited) |
|||||
|
|
|
|
||
|
2023 |
|
2022 |
||
Cash, cash equivalents, and restricted cash |
$ |
649 |
|
$ |
493 |
Receivables, net |
|
1,887 |
|
|
1,818 |
Inventories |
|
2,790 |
|
|
3,151 |
Other current assets |
|
1,110 |
|
|
1,970 |
Total current assets |
|
6,436 |
|
|
7,432 |
|
|
|
|
||
Property, plant and equipment, net |
|
4,218 |
|
|
4,203 |
|
|
22,311 |
|
|
22,437 |
Other assets |
|
1,494 |
|
|
1,432 |
Total assets |
$ |
34,459 |
|
$ |
35,504 |
|
|
|
|
||
Short-term borrowings |
$ |
1,362 |
|
$ |
597 |
Other current liabilities |
|
2,570 |
|
|
3,131 |
Total current liabilities |
|
3,932 |
|
|
3,728 |
|
|
|
|
||
Long-term debt |
|
9,208 |
|
|
10,373 |
Non-current liabilities |
|
3,603 |
|
|
3,659 |
|
|
|
|
||
Redeemable non-controlling interests |
|
61 |
|
|
59 |
|
|
|
|
||
Shareholders' equity |
|
17,655 |
|
|
17,685 |
Total liabilities and shareholders' equity |
$ |
34,459 |
|
$ |
35,504 |
|
|||||||
Consolidated Statements of Cash Flows |
|||||||
(Amounts in millions) |
|||||||
(Unaudited) |
|||||||
|
Six Months Ended |
||||||
|
|
2023 |
|
|
|
2022 |
|
Cash flows from operating activities: |
|
|
|
||||
Net income |
$ |
19 |
|
|
$ |
355 |
|
Adjustments to reconcile to net cash provided by (used in) operating activities |
|
|
|
||||
Depreciation and amortization |
|
563 |
|
|
|
604 |
|
Deferred income taxes |
|
(27 |
) |
|
|
(178 |
) |
Gains on sale of assets |
|
(2 |
) |
|
|
(2 |
) |
Losses on business divestitures |
|
19 |
|
|
|
— |
|
Stock-based compensation |
|
32 |
|
|
|
25 |
|
Pension contributions |
|
(18 |
) |
|
|
(17 |
) |
Impairment of long-lived assets |
|
— |
|
|
|
120 |
|
Inventory write-down |
|
44 |
|
|
|
— |
|
Changes in assets and liabilities, net of acquisitions: |
|
|
|
||||
Trade receivables |
|
(70 |
) |
|
|
(363 |
) |
Inventories |
|
333 |
|
|
|
(573 |
) |
Accounts payable |
|
(92 |
) |
|
|
143 |
|
Accruals for incentive compensation |
|
(77 |
) |
|
|
(62 |
) |
Other current payables and accrued expenses |
|
(248 |
) |
|
|
(67 |
) |
Other assets/liabilities, net |
|
(101 |
) |
|
|
(36 |
) |
Net cash provided by (used in) operating activities |
|
375 |
|
|
|
(51 |
) |
Cash flows from investing activities: |
|
|
|
||||
Cash paid for acquisitions, net of cash received |
|
— |
|
|
|
(123 |
) |
Additions to property, plant and equipment |
|
(290 |
) |
|
|
(236 |
) |
Additions to intangible assets |
|
— |
|
|
|
(2 |
) |
Proceeds from disposal of assets |
|
21 |
|
|
|
4 |
|
Cash provided by the Merger with N&B |
|
— |
|
|
|
11 |
|
Net proceeds received from business divestitures |
|
821 |
|
|
|
— |
|
Net cash provided by (used in) investing activities |
|
552 |
|
|
|
(346 |
) |
Cash flows from financing activities: |
|
|
|
||||
Cash dividends paid to shareholders |
|
(413 |
) |
|
|
(402 |
) |
(Decrease) increase in revolving credit facility and short-term borrowings |
|
(100 |
) |
|
|
351 |
|
Deferred financing costs |
|
(2 |
) |
|
|
— |
|
Proceeds from issuance of commercial paper (maturities after three months) |
|
— |
|
|
|
160 |
|
Repayments of commercial paper (maturities after three months) |
|
— |
|
|
|
(230 |
) |
Net (repayments) borrowings of commercial paper (maturities less than three months) |
|
(28 |
) |
|
|
532 |
|
Repayments of long-term debt |
|
(300 |
) |
|
|
— |
|
Deferred consideration paid |
|
(6 |
) |
|
|
— |
|
Employee withholding taxes paid |
|
(11 |
) |
|
|
(20 |
) |
Other, net |
|
(6 |
) |
|
|
(14 |
) |
Net cash (used in) provided by financing activities |
|
(866 |
) |
|
|
377 |
|
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
39 |
|
|
|
(74 |
) |
Net change in cash, cash equivalents and restricted cash |
|
100 |
|
|
|
(94 |
) |
Cash, cash equivalents and restricted cash at beginning of year |
|
552 |
|
|
|
716 |
|
Cash, cash equivalents and restricted cash at end of period |
$ |
652 |
|
|
$ |
622 |
|
The following table reconciles cash, cash equivalents and restricted cash between the Company's statement of cash flows for the periods ended
AMOUNTS IN MILLIONS |
|
|
|
|
|
|
|
||||
Current assets |
|
|
|
|
|
|
|
||||
Cash and cash equivalents |
$ |
638 |
|
$ |
483 |
|
$ |
569 |
|
$ |
711 |
Cash and cash equivalents included in Assets held for sale |
|
3 |
|
|
52 |
|
|
49 |
|
|
— |
Restricted cash |
|
11 |
|
|
10 |
|
|
4 |
|
|
4 |
Non-current assets |
|
|
|
|
|
|
|
||||
Restricted cash included in Other assets |
|
— |
|
|
7 |
|
|
— |
|
|
1 |
Cash, cash equivalents and restricted cash |
$ |
652 |
|
$ |
552 |
|
$ |
622 |
|
$ |
716 |
|
|||||||||||||||
Reportable Segment Performance |
|||||||||||||||
(Amounts in millions) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
||||||||
Nourish |
$ |
1,564 |
|
|
$ |
1,818 |
|
|
$ |
3,217 |
|
|
$ |
3,549 |
|
Health & Biosciences |
|
522 |
|
|
|
665 |
|
|
|
1,035 |
|
|
|
1,326 |
|
Scent |
|
592 |
|
|
|
580 |
|
|
|
1,200 |
|
|
|
1,165 |
|
Pharma Solutions |
|
251 |
|
|
|
244 |
|
|
|
504 |
|
|
|
493 |
|
Consolidated |
$ |
2,929 |
|
|
$ |
3,307 |
|
|
$ |
5,956 |
|
|
$ |
6,533 |
|
Segment Adjusted Operating EBITDA |
|
|
|
|
|
|
|
||||||||
Nourish |
$ |
181 |
|
|
$ |
365 |
|
|
$ |
389 |
|
|
$ |
694 |
|
Health & Biosciences |
|
145 |
|
|
|
184 |
|
|
|
276 |
|
|
|
376 |
|
Scent |
|
117 |
|
|
|
93 |
|
|
|
222 |
|
|
|
209 |
|
Pharma Solutions |
|
67 |
|
|
|
58 |
|
|
|
126 |
|
|
|
123 |
|
Total |
|
510 |
|
|
|
700 |
|
|
|
1,013 |
|
|
|
1,402 |
|
Depreciation & Amortization |
|
(287 |
) |
|
|
(301 |
) |
|
|
(563 |
) |
|
|
(604 |
) |
Interest Expense |
|
(116 |
) |
|
|
(77 |
) |
|
|
(227 |
) |
|
|
(149 |
) |
Other Income (Expense), net |
|
21 |
|
|
|
(6 |
) |
|
|
15 |
|
|
|
10 |
|
Restructuring and Other Charges |
|
(7 |
) |
|
|
(7 |
) |
|
|
(59 |
) |
|
|
(9 |
) |
Impairment of Long-Lived Assets |
|
— |
|
|
|
(120 |
) |
|
|
— |
|
|
|
(120 |
) |
Acquisition, Divestiture and Integration Related Costs |
|
(45 |
) |
|
|
(61 |
) |
|
|
(76 |
) |
|
|
(110 |
) |
Strategic Initiatives Costs |
|
(9 |
) |
|
|
— |
|
|
|
(22 |
) |
|
|
— |
|
Regulatory Costs |
|
(14 |
) |
|
|
— |
|
|
|
(19 |
) |
|
|
— |
|
Other |
|
(3 |
) |
|
|
2 |
|
|
|
2 |
|
|
|
(5 |
) |
Income Before Taxes |
$ |
50 |
|
|
$ |
130 |
|
|
$ |
64 |
|
|
$ |
415 |
|
Segment Adjusted Operating EBITDA Margin |
|
|
|
|
|
|
|
||||||||
Nourish |
|
11.6 |
% |
|
|
20.1 |
% |
|
|
12.1 |
% |
|
|
19.6 |
% |
Health & Biosciences |
|
27.8 |
% |
|
|
27.7 |
% |
|
|
26.7 |
% |
|
|
28.4 |
% |
Scent |
|
19.8 |
% |
|
|
16.0 |
% |
|
|
18.5 |
% |
|
|
17.9 |
% |
Pharma Solutions |
|
26.7 |
% |
|
|
23.8 |
% |
|
|
25.0 |
% |
|
|
24.9 |
% |
Consolidated |
|
17.4 |
% |
|
|
21.2 |
% |
|
|
17.0 |
% |
|
|
21.5 |
% |
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) |
2023 |
|
2022 |
||
Reported (GAAP) |
$ |
933 |
|
$ |
1,136 |
Acquisition, Divestiture and Integration Related Costs (c) |
|
— |
|
|
1 |
Adjusted (Non-GAAP) |
$ |
933 |
|
$ |
1,137 |
Reconciliation of Selling and Administrative Expenses |
|||||||
|
Second Quarter |
||||||
(DOLLARS IN MILLIONS) |
|
2023 |
|
|
|
2022 |
|
Reported (GAAP) |
$ |
445 |
|
|
$ |
456 |
|
Acquisition, Divestiture and Integration Related Costs (c) |
|
(45 |
) |
|
|
(60 |
) |
Strategic Initiatives Costs (f) |
|
(9 |
) |
|
|
— |
|
Regulatory Costs (g) |
|
(14 |
) |
|
|
— |
|
Adjusted (Non-GAAP) |
$ |
377 |
|
|
$ |
396 |
|
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 |
||||||||||||||||||||||||||||||
|
2023 |
|
2022 |
||||||||||||||||||||||||||||
(DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS) |
Income before taxes |
|
Provision for income taxes (j) |
|
Net income attributable to IFF (k) |
|
Diluted EPS (l) |
|
Income before taxes |
|
Provision for income taxes (j) |
|
Net income attributable to IFF (k) |
|
Diluted EPS |
||||||||||||||||
Reported (GAAP) |
$ |
50 |
|
|
$ |
23 |
|
|
$ |
27 |
|
|
$ |
0.11 |
|
|
$ |
130 |
|
|
$ |
21 |
|
|
$ |
107 |
|
|
$ |
0.43 |
|
Restructuring and Other Charges (a) |
|
7 |
|
|
|
4 |
|
|
|
3 |
|
|
|
0.02 |
|
|
|
7 |
|
|
|
2 |
|
|
|
5 |
|
|
|
0.02 |
|
Impairment of Long-Lived Assets (b) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
120 |
|
|
|
24 |
|
|
|
96 |
|
|
|
0.38 |
|
Acquisition, Divestiture and Integration Related Costs (c) |
|
45 |
|
|
|
7 |
|
|
|
38 |
|
|
|
0.15 |
|
|
|
61 |
|
|
|
15 |
|
|
|
46 |
|
|
|
0.18 |
|
Losses on Business Disposals (d) |
|
5 |
|
|
|
(8 |
) |
|
|
13 |
|
|
|
0.05 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Gain on China Facility Relocation (e) |
|
(22 |
) |
|
|
(6 |
) |
|
|
(16 |
) |
|
|
(0.06 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Strategic Initiatives Costs (f) |
|
9 |
|
|
|
2 |
|
|
|
7 |
|
|
|
0.03 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Regulatory Costs (g) |
|
14 |
|
|
|
3 |
|
|
|
11 |
|
|
|
0.04 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Other (h) |
|
3 |
|
|
|
— |
|
|
|
3 |
|
|
|
0.01 |
|
|
|
(2 |
) |
|
|
(1 |
) |
|
|
(1 |
) |
|
|
(0.01 |
) |
Redemption value adjustment to EPS (i) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.01 |
) |
Adjusted (Non-GAAP) |
$ |
111 |
|
|
$ |
25 |
|
|
$ |
86 |
|
|
$ |
0.34 |
|
|
$ |
316 |
|
|
$ |
61 |
|
|
$ |
253 |
|
|
$ |
0.99 |
|
Reconciliation of Adjusted (Non-GAAP) EPS ex. Amortization |
|||||
|
Second Quarter |
||||
(DOLLARS AND SHARE AMOUNTS IN MILLIONS) |
2023 |
|
2022 |
||
Numerator |
|
|
|
||
Adjusted (Non-GAAP) Net Income |
$ |
86 |
|
$ |
253 |
Amortization of Acquisition related Intangible Assets |
|
172 |
|
|
184 |
Tax impact on Amortization of Acquisition related Intangible Assets (j) |
|
39 |
|
|
43 |
Amortization of Acquisition related Intangible Assets, net of tax (m) |
|
133 |
|
|
141 |
Adjusted (Non-GAAP) Net Income ex. Amortization |
$ |
219 |
|
$ |
394 |
|
|
|
|
||
Denominator |
|
|
|
||
Weighted average shares assuming dilution (diluted) |
|
255 |
|
|
255 |
Adjusted (Non-GAAP) EPS ex. Amortization |
$ |
0.86 |
|
$ |
1.54 |
(a) |
For 2023 and 2022, represents costs primarily related to severance as part of the Company's restructuring efforts. |
(b) |
Represents costs related to the impairment of intangible and fixed assets of an asset group that operated primarily in |
(c) |
For 2023 and 2022, primarily represents costs related to the Company's actual and planned acquisitions and divestitures and integration related activities primarily for |
(d) |
Represents losses recognized primarily related to the divestiture of the portion of the Savory Solutions business. |
(e) |
Represents gain recognized from the completion of the relocation of a facility in |
(f) |
Represents costs related to the Company's strategic assessment and business portfolio optimization efforts and reorganizing the Global Shared Services Centers, primarily consulting fees. |
(g) |
Represents costs primarily related to legal fees incurred for the ongoing investigations of the fragrance businesses. |
(h) |
For 2023, represents losses from sale of assets. For 2022, represents gains from sale of assets. |
(i) |
Represents the adjustment to EPS related to the excess of the redemption value of certain redeemable non-controlling 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 2023, net income is reduced by income attributable to non-controlling interest of less than |
(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. |
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) |
2023 |
|
2022 |
||
Reported (GAAP) |
$ |
1,897 |
|
$ |
2,281 |
Acquisition, Divestiture and Integration Related Costs (c) |
|
— |
|
|
2 |
Adjusted (Non-GAAP) |
$ |
1,897 |
|
$ |
2,283 |
Reconciliation of Selling and Administrative Expenses |
|||||||
|
Second Quarter Year-to-Date |
||||||
(DOLLARS IN MILLIONS) |
|
2023 |
|
|
|
2022 |
|
Reported (GAAP) |
$ |
899 |
|
|
$ |
915 |
|
Acquisition, Divestiture and Integration Related Costs (c) |
|
(76 |
) |
|
|
(108 |
) |
Strategic Initiatives Costs (f) |
|
(22 |
) |
|
|
— |
|
Regulatory Costs (g) |
|
(19 |
) |
|
|
— |
|
Other (h) |
|
— |
|
|
|
(7 |
) |
Adjusted (Non-GAAP) |
$ |
782 |
|
|
$ |
800 |
|
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 Year-to-Date |
|||||||||||||||||||||||||||
|
2023 |
|
2022 |
|||||||||||||||||||||||||
(DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS) |
Income before taxes |
|
Provision for income taxes (j) |
|
Net income attributable to IFF (k) |
|
Diluted EPS (l) |
|
Income before taxes |
|
Provision for income taxes (j) |
|
Net income attributable to IFF (k) |
|
Diluted EPS (l) |
|||||||||||||
Reported (GAAP) |
$ |
64 |
|
|
$ |
45 |
|
|
$ |
18 |
|
|
$ |
0.07 |
|
|
$ |
415 |
|
$ |
60 |
|
$ |
351 |
|
$ |
1.38 |
|
Restructuring and Other Charges (a) |
|
59 |
|
|
|
16 |
|
|
|
43 |
|
|
|
0.17 |
|
|
|
9 |
|
|
2 |
|
|
7 |
|
|
0.03 |
|
Impairment of Long-Lived Assets (b) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
120 |
|
|
24 |
|
|
96 |
|
|
0.38 |
|
Acquisition, Divestiture and Integration Related Costs (c) |
|
76 |
|
|
|
— |
|
|
|
76 |
|
|
|
0.30 |
|
|
|
110 |
|
|
27 |
|
|
83 |
|
|
0.32 |
|
Losses on Business Disposals (d) |
|
19 |
|
|
|
(5 |
) |
|
|
24 |
|
|
|
0.09 |
|
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Gain on China Facility Relocation (e) |
|
(22 |
) |
|
|
(6 |
) |
|
|
(16 |
) |
|
|
(0.06 |
) |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Strategic Initiatives Costs (f) |
|
22 |
|
|
|
5 |
|
|
|
17 |
|
|
|
0.07 |
|
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Regulatory Costs (g) |
|
19 |
|
|
|
4 |
|
|
|
15 |
|
|
|
0.06 |
|
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Other (h) |
|
(2 |
) |
|
|
(1 |
) |
|
|
(1 |
) |
|
|
— |
|
|
|
5 |
|
|
1 |
|
|
4 |
|
|
0.01 |
|
Redemption value adjustment to EPS (i) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
|
|
— |
|
|
(0.01 |
) |
Adjusted (Non-GAAP) |
$ |
235 |
|
|
$ |
58 |
|
|
$ |
176 |
|
|
$ |
0.69 |
|
|
$ |
659 |
|
$ |
114 |
|
$ |
541 |
|
$ |
2.12 |
|
Reconciliation of Adjusted (Non-GAAP) EPS ex. Amortization |
|||||
|
Second Quarter Year-to-Date |
||||
(DOLLARS AND SHARE AMOUNTS IN MILLIONS) |
2023 |
|
2022 |
||
Numerator |
|
|
|
||
Adjusted (Non-GAAP) Net Income |
$ |
176 |
|
$ |
541 |
Amortization of Acquisition related Intangible Assets |
|
343 |
|
|
370 |
Tax impact on Amortization of Acquisition related Intangible Assets (j) |
|
78 |
|
|
86 |
Amortization of Acquisition related Intangible Assets, net of tax (m) |
|
265 |
|
|
284 |
Adjusted (Non-GAAP) Net Income ex. Amortization |
$ |
441 |
|
$ |
825 |
|
|
|
|
||
Denominator |
|
|
|
||
Weighted average shares assuming dilution (diluted) |
|
255 |
|
|
255 |
Adjusted (Non-GAAP) EPS ex. Amortization |
$ |
1.72 |
|
$ |
3.23 |
(a) |
For 2023 and 2022, represents costs primarily related to severance as part of the Company's restructuring efforts. |
(b) |
Represents costs related to the impairment of intangible and fixed assets of an asset group that operated primarily in |
(c) |
For 2023 and 2022, primarily represents costs related to the Company's actual and planned acquisitions and divestitures and integration related activities primarily for |
(d) |
Represents losses recognized primarily related to the divestiture of the portion of the Savory Solutions business and liquidation of a business in |
(e) |
Represents gain recognized from the completion of the relocation of a facility in |
(f) |
Represents costs related to the Company's strategic assessment and business portfolio optimization efforts and reorganizing the Global Shared Services Centers, primarily consulting fees. |
(g) |
Represents costs primarily related to legal fees incurred for the ongoing investigations of the fragrance businesses. |
(h) |
For 2023, represents gains from sale of assets. For 2022, represents shareholder activist related costs, primarily professional fees, severance costs, including accelerated stock compensation expense, for certain executives who have been separated from the Company, and gains from sale of assets. |
(i) |
Represents the adjustment to EPS related to the excess of the redemption value of certain redeemable non-controlling 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 2023 and 2022, net income is reduced by income attributable to non-controlling interest of |
(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. |
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 (Loss) |
|||
(DOLLARS IN MILLIONS) |
Twelve Months Ended |
||
Net (loss) |
$ |
(2,204 |
) |
Interest expense |
|
414 |
|
Income taxes |
|
224 |
|
Depreciation and amortization |
|
1,138 |
|
Specified items(1) |
|
2,535 |
|
Non-cash items(2) |
|
83 |
|
Credit Adjusted EBITDA |
$ |
2,190 |
|
______________________ |
|
1. |
Specified items consisted of restructuring and other charges, impairment of goodwill, acquisition, divestiture and integration related costs, strategic initiatives costs, regulatory costs and other costs that are not related to recurring operations. |
2. |
Non-cash items consisted of gains on sale of assets, losses on business disposals, gain on |
Net Debt to Total Debt |
||
(DOLLARS IN MILLIONS) |
|
|
Total debt(1) |
$ |
10,591 |
Adjustments: |
|
|
Cash and cash equivalents(2) |
|
641 |
Net debt |
$ |
9,950 |
______________________ |
|
(1) |
Total debt used for the calculation of net debt consisted of short-term debt, long-term debt, short-term finance lease obligations and long-term finance lease obligations. |
(2) |
Cash and cash equivalents included approximately |
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 |
|
Six Months Ended |
||||||||||||
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
||||||||
Nourish(1) |
$ |
1,564 |
|
|
$ |
1,769 |
|
|
$ |
3,217 |
|
|
$ |
3,500 |
|
Health & Biosciences(2) |
|
522 |
|
|
|
549 |
|
|
|
1,026 |
|
|
|
1,089 |
|
Scent |
|
592 |
|
|
|
580 |
|
|
|
1,200 |
|
|
|
1,165 |
|
Pharma Solutions |
|
251 |
|
|
|
244 |
|
|
|
504 |
|
|
|
493 |
|
Consolidated |
$ |
2,929 |
|
|
$ |
3,142 |
|
|
$ |
5,947 |
|
|
$ |
6,247 |
|
Segment Adjusted Operating EBITDA |
|
|
|
|
|
|
|
||||||||
Nourish(1) |
$ |
181 |
|
|
$ |
358 |
|
|
$ |
389 |
|
|
$ |
687 |
|
Health & Biosciences(2) |
|
145 |
|
|
|
166 |
|
|
|
278 |
|
|
|
340 |
|
Scent |
|
117 |
|
|
|
93 |
|
|
|
222 |
|
|
|
209 |
|
Pharma Solutions |
|
67 |
|
|
|
58 |
|
|
|
126 |
|
|
|
123 |
|
Total |
|
510 |
|
|
|
675 |
|
|
|
1,015 |
|
|
|
1,359 |
|
Depreciation & Amortization |
|
(287 |
) |
|
|
(301 |
) |
|
|
(563 |
) |
|
|
(604 |
) |
Interest Expense |
|
(116 |
) |
|
|
(77 |
) |
|
|
(227 |
) |
|
|
(149 |
) |
Other Income (Expense), net |
|
21 |
|
|
|
(6 |
) |
|
|
15 |
|
|
|
10 |
|
Restructuring and Other Charges |
|
(7 |
) |
|
|
(7 |
) |
|
|
(59 |
) |
|
|
(9 |
) |
Impairment of Long-Lived Assets |
|
— |
|
|
|
(120 |
) |
|
|
— |
|
|
|
(120 |
) |
Acquisition, Divestiture and Integration Related Costs |
|
(45 |
) |
|
|
(61 |
) |
|
|
(76 |
) |
|
|
(110 |
) |
Strategic Initiatives Costs |
|
(9 |
) |
|
|
— |
|
|
|
(22 |
) |
|
|
— |
|
Regulatory Costs |
|
(14 |
) |
|
|
— |
|
|
|
(19 |
) |
|
|
— |
|
Other |
|
(3 |
) |
|
|
2 |
|
|
|
2 |
|
|
|
(5 |
) |
Impact of Business Divestitures(3) |
|
— |
|
|
|
25 |
|
|
|
— |
|
|
|
43 |
|
Impact of Business Acquisitions(4) |
|
— |
|
|
|
— |
|
|
|
(2 |
) |
|
|
— |
|
Income Before Taxes |
$ |
50 |
|
|
$ |
130 |
|
|
$ |
64 |
|
|
$ |
415 |
|
Segment Adjusted Operating EBITDA Margin |
|
|
|
|
|
|
|
||||||||
Nourish |
|
11.6 |
% |
|
|
20.2 |
% |
|
|
12.1 |
% |
|
|
19.6 |
% |
Health & Biosciences |
|
27.8 |
% |
|
|
30.2 |
% |
|
|
27.1 |
% |
|
|
31.2 |
% |
Scent |
|
19.8 |
% |
|
|
16.0 |
% |
|
|
18.5 |
% |
|
|
17.9 |
% |
Pharma Solutions |
|
26.7 |
% |
|
|
23.8 |
% |
|
|
25.0 |
% |
|
|
24.9 |
% |
Consolidated |
|
17.4 |
% |
|
|
21.5 |
% |
|
|
17.1 |
% |
|
|
21.8 |
% |
______________________ |
|
1. |
Nourish sales and segment adjusted operating EBITDA information for the three and six months ended |
2. |
Health & Biosciences sales and segment adjusted operating EBITDA information for the six months ended |
3. |
Information related to the amounts exclude the results of the Microbial Control business unit and the portion of the Savory Solutions business that were divested in the third quarter of 2022 ( |
4. |
Information related to the amount excludes the results of Health Wright Products for the first quarter of 2023 to present fully comparable scenarios of the Company, as the acquisition of Health Wright Products was completed on |
|
||||||
GAAP to Non-GAAP Reconciliation |
||||||
Comparable Foreign Exchange Impact |
||||||
(Unaudited) |
||||||
Q2 Nourish |
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Reported |
|
(14)% |
|
(50)% |
|
(8.5)% |
Portfolio Impact |
|
2% |
|
1% |
|
(0.1)% |
% Change - Comparable |
|
(12)% |
|
(49)% |
|
(8.6)% |
Currency Impact |
|
3% |
|
7% |
|
1.2% |
% Change - Currency Neutral |
|
(9)% |
|
(42)% |
|
(7.4)% |
|
|
|
|
|
|
|
|
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Reported |
|
(22)% |
|
(21)% |
|
0.1% |
Portfolio Impact |
|
17% |
|
9% |
|
(2.5)% |
% Change - Comparable |
|
(5)% |
|
(13)% |
|
(2.4)% |
Currency Impact |
|
2% |
|
4% |
|
0.4% |
% Change - Currency Neutral |
|
(3)% |
|
(9)% |
|
(2.0)% |
|
|
|
|
|
|
|
Q2 Scent |
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Reported |
|
2% |
|
26% |
|
3.8% |
Portfolio Impact |
|
0% |
|
0% |
|
0.0% |
% Change - Comparable |
|
2% |
|
26% |
|
3.8% |
Currency Impact |
|
3% |
|
15% |
|
1.7% |
% Change - Currency Neutral |
|
5% |
|
41% |
|
5.5% |
|
|
|
|
|
|
|
Q2 Pharma Solutions |
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Reported |
|
3% |
|
16% |
|
2.9% |
Portfolio Impact |
|
0% |
|
0% |
|
0.0% |
% Change - Comparable |
|
3% |
|
16% |
|
2.9% |
Currency Impact |
|
0% |
|
0% |
|
0.0% |
% Change - Currency Neutral |
|
3% |
|
16% |
|
2.9% |
|
|
|
|
|
|
|
Q2 Consolidated |
|
Sales |
|
Adjusted Operating EBITDA |
|
Adjusted Operating EBITDA Margin |
% Change - Reported |
|
(11)% |
|
(27)% |
|
(3.8)% |
Portfolio Impact |
|
5% |
|
3% |
|
(0.3)% |
% Change - Comparable |
|
(7)% |
|
(24)% |
|
(4.1)% |
Currency Impact |
|
3% |
|
6% |
|
1.1% |
% Change - Currency Neutral |
|
(4)% |
|
(18)% |
|
(3.0)% |
_______________________ |
Note: The sum of these items may not foot due to rounding. |
YTD Nourish |
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Reported |
|
(9)% |
|
(44)% |
|
(7.5)% |
Portfolio Impact |
|
1% |
|
1% |
|
0.0% |
% Change - Comparable |
|
(8)% |
|
(43)% |
|
(7.5)% |
Currency Impact |
|
3% |
|
8% |
|
1.2% |
% Change - Currency Neutral |
|
(5)% |
|
(35)% |
|
(6.3)% |
|
|
|
|
|
|
|
|
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Reported |
|
(22)% |
|
(27)% |
|
(1.7)% |
Portfolio Impact |
|
16% |
|
8% |
|
(2.4)% |
% Change - Comparable |
|
(6)% |
|
(18)% |
|
(4.1)% |
Currency Impact |
|
3% |
|
4% |
|
0.4% |
% Change - Currency Neutral |
|
(3)% |
|
(14)% |
|
(3.7)% |
|
|
|
|
|
|
|
YTD Scent |
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Reported |
|
3% |
|
6% |
|
0.6% |
Portfolio Impact |
|
0% |
|
0% |
|
0.0% |
% Change - Comparable |
|
3% |
|
6% |
|
0.6% |
Currency Impact |
|
4% |
|
13% |
|
1.4% |
% Change - Currency Neutral |
|
7% |
|
19% |
|
2.0% |
|
|
|
|
|
|
|
YTD Pharma Solutions |
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Reported |
|
2% |
|
2% |
|
0.1% |
Portfolio Impact |
|
0% |
|
0% |
|
0.0% |
% Change - Comparable |
|
2% |
|
2% |
|
0.1% |
Currency Impact |
|
2% |
|
2% |
|
0.1% |
% Change - Currency Neutral |
|
4% |
|
4% |
|
0.2% |
|
|
|
|
|
|
|
YTD Consolidated |
|
Sales |
|
Adjusted Operating EBITDA |
|
Adjusted Operating EBITDA Margin |
% Change - Reported |
|
(9)% |
|
(28)% |
|
(4.5)% |
Portfolio Impact |
|
4% |
|
2% |
|
(0.2)% |
% Change - Comparable |
|
(5)% |
|
(25)% |
|
(4.7)% |
Currency Impact |
|
3% |
|
7% |
|
1.0% |
% Change - Currency Neutral |
|
(2)% |
|
(18)% |
|
(3.7)% |
_______________________ |
Note: The sum of these items may not foot due to rounding. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20230807251943/en/
Media Relations:
332.877.5339
Media.request@iff.com
Investor Relations:
212.708.7263
Investor.Relations@iff.com
Source: IFF