Sensient Technologies Corporation (NYSE: SXT), a leading
provider of flavors and colors for the food, pharmaceutical, and
personal care markets, today reported financial results for the
fourth quarter ended December 31, 2024.
Fourth Quarter Consolidated Results
- Reported revenue increased 7.8% to $376.4 million in the fourth
quarter of 2024 versus last year’s fourth quarter results of $349.3
million. On a local currency basis(1), revenue increased 8.9%.
- Reported operating income increased to $42.0 million compared
to $8.1 million recorded in the fourth quarter of 2023. In the
fourth quarter of 2024, the Company recorded $0.9 million of costs
related to its Portfolio Optimization Plan versus last year’s $27.8
million in the fourth quarter. Local currency adjusted operating
income(1) and local currency adjusted EBITDA(1) increased 20.8% and
18.8%, respectively, in the fourth quarter, with each increasing
primarily as a result of higher sales volumes.
- Reported earnings per share was 71 cents in the fourth quarter
of 2024 compared to a loss of 14 cents in the fourth quarter of
2023. Local currency adjusted EPS(1) increased 29.4% in the fourth
quarter.
“As expected, Sensient delivered strong performance in 2024,
driven by solid volume growth and sales wins, particularly in
natural colors. Our results demonstrate our ability to succeed in
the markets we participate in and the strength of our product
portfolio,” said Paul Manning, Sensient’s Chairman, President, and
Chief Executive Officer.
Fourth Quarter Group Results
Reported Local Currency(1) Revenue
Quarter
Year-to-Date
Quarter
Year-to-Date
Flavors & Extracts
2.8%
7.1%
3.4%
7.1%
Color
11.8%
6.6%
14.0%
7.3%
Asia Pacific
26.1%
11.2%
25.2%
13.0%
Total Revenue
7.8%
6.9%
8.9%
7.4%
Reported
Adjusted Local
Currency(1)
Operating Income
Quarter
Year-to-Date
Quarter
Year-to-Date
Flavors & Extracts
18.2%
10.6%
18.4%
10.8%
Color
24.4%
13.4%
27.4%
14.2%
Asia Pacific
44.3%
11.9%
41.7%
14.1%
Total Operating Income
420.8%
23.6%
20.8%
9.3%
The Flavors & Extracts Group reported fourth quarter 2024
revenue of $188.1 million, an increase of $5.2 million versus the
prior year’s fourth quarter. The Group’s revenue benefited from
favorable pricing and higher volumes. Segment operating income was
$21.3 million in the fourth quarter of 2024, an increase of $3.3
million compared to the prior year’s fourth quarter. The higher
operating income was also driven by the favorable pricing and
higher volumes.
The Color Group reported revenue of $158.1 million in the fourth
quarter of 2024, an increase of $16.7 million compared to the prior
year’s fourth quarter. The Group’s revenue increase was driven
primarily by higher volumes in both the food and pharmaceutical and
personal care product lines. Segment operating income was $26.5
million in the fourth quarter of 2024, an increase of $5.2 million
compared to the prior year’s fourth quarter results. The higher
operating income was primarily a result of the higher volumes,
along with favorable pricing.
The Asia Pacific Group reported revenue of $41.9 million in the
fourth quarter of 2024, an increase of $8.7 million compared to the
prior year’s fourth quarter. The Group’s revenue benefited
primarily by higher volumes across nearly all geographies. Segment
operating income was $8.5 million in the quarter, an increase of
$2.6 million compared to the prior year’s fourth quarter. The
higher operating income was primarily a result of the higher
volumes.
Corporate & Other reported operating expenses of $14.4
million in the fourth quarter of 2024, compared to $37.2 million of
operating expenses reported in the prior year’s fourth quarter. The
decrease was primarily due to the Portfolio Optimization Plan costs
of $27.8 million recorded in the fourth quarter of 2023, which were
primarily non-cash costs. Local currency adjusted operating
expenses(1) for Corporate & Other increased $4.1 million
compared to the prior year’s fourth quarter, primarily due to
higher performance-based compensation costs recorded in 2024.
2025 OUTLOOK
Metric Current Guidance Local
Currency Revenue(1) Mid-Single-Digit Growth
Local Currency Adjusted EBITDA(1) Mid-Single-Digit to
High Single-Digit Growth Diluted EPS (GAAP)
Between $3.05 and $3.15* Local Currency Adjusted
Diluted EPS(1) High Single-Digit to Double-Digit Growth
*Includes approximately 13 cents of Portfolio Optimization
Plan costs and 10 to 15 cents of foreign currency headwinds based
on current exchange rates
The Company’s guidance is based on current conditions and
economic and market trends in the markets in which the Company
operates and is subject to various risks and uncertainties as
described below.
(1)
Please refer to “Reconciliation of
Non-GAAP Amounts” at the end of this release for more information
regarding our non-GAAP financial measures.
USE OF NON-GAAP FINANCIAL MEASURES
The Company’s non-GAAP financial measures eliminate the impact
of certain items, which, depending on the measure, include:
currency movements, depreciation and amortization, Portfolio
Optimization Plan costs, and non-cash share-based compensation.
These measures are provided to enhance the overall understanding of
the Company’s performance when viewed together with the GAAP
results. Refer to “Reconciliation of Non-GAAP Amounts” at the end
of this release.
CONFERENCE CALL
The Company will host a conference call to discuss its 2024
fourth quarter financial results at 8:30 a.m. CST on Friday,
February 14, 2025. To participate in the conference call, contact
Chorus Call Inc. at (844) 492-3726 or (412) 317-1078, and ask to
join the Sensient Technologies Corporation conference call.
Alternatively, the call can be accessed by using the webcast link
that is available on the Investor Information section of the
Company’s web site at www.sensient.com.
A replay of the call will be available one hour after the end of
the conference call through February 21, 2025, by calling (877)
344-7529 and using access code 3864433. An audio replay and written
transcript of the call will also be posted on the Investor
Information section of the Company’s web site at www.sensient.com
on or after February 18, 2025.
This release contains statements that may constitute
“forward-looking statements” within the meaning of Federal
securities laws including under “2025 Outlook” above. Such
forward-looking statements are not guarantees of future performance
and involve known and unknown risks, uncertainties, and other
factors concerning the Company’s operations and business
environment. Important factors that could cause actual results to
differ materially from those suggested by these forward-looking
statements and that could adversely affect the Company’s future
financial performance include the following: the Company’s ability
to manage general business, economic, and capital market
conditions, including actions taken by customers in response to
such market conditions, and the impact of recessions and economic
downturns; the impact of macroeconomic and geopolitical volatility,
including inflation and shortages impacting the availability and
cost of raw materials, energy, and other supplies, disruptions and
delays in the Company’s supply chain, and the conflicts between
Russia and Ukraine and in the Middle East; industry, regulatory,
legal, and economic factors related to the Company’s domestic and
international business; the effects of tariffs, trade barriers, and
disputes; the availability and cost of labor, logistics, and
transportation; the pace and nature of new product introductions by
the Company and the Company’s customers; the Company’s ability to
anticipate and respond to changing consumer preferences, changing
technologies, and changing regulations; the Company’s ability to
successfully implement its growth strategies; the outcome of the
Company’s various productivity-improvement and cost-reduction
efforts, acquisition and divestiture activities, and Portfolio
Optimization Plan; growth in markets for products in which the
Company competes; industry and customer acceptance of price
increases; actions by competitors; the Company’s ability to enhance
its innovation efforts and drive cost efficiencies; currency
exchange rate fluctuations; and other factors included in “Risk
Factors” in the Company's Annual Report on Form 10-K for the year
ended December 31, 2024, and in other documents that the Company
files with the SEC. The risks and uncertainties identified above
are not the only risks the Company faces. Additional risks and
uncertainties not presently known to the Company or that it
currently believes to be immaterial also may adversely affect the
Company. Should any known or unknown risks and uncertainties
develop into actual events, these developments could have material
adverse effects on our business, financial condition, and results
of operations. This release contains time-sensitive information
that reflects management’s best analysis only as of the date of
this release. Except to the extent required by applicable laws, the
Company does not undertake to publicly update or revise its
forward-looking statements even if experience or future changes
make it clear that any projected results expressed or implied
herein will not be realized.
ABOUT SENSIENT TECHNOLOGIES
Sensient Technologies Corporation is a leading global
manufacturer and marketer of colors, flavors, and other specialty
ingredients. Sensient uses advanced technologies and robust global
supply chain capabilities to develop specialized solutions for food
and beverages, as well as products that serve the pharmaceutical,
nutraceutical, and personal care industries. Sensient’s customers
range in size from small entrepreneurial businesses to major
international manufacturers representing some of the world’s
best-known brands. Sensient is headquartered in Milwaukee,
Wisconsin.
www.sensient.com
Sensient Technologies Corporation (In thousands, except
percentages and per share amounts) (Unaudited)
Consolidated Statements of Earnings
Three Months Ended December
31,
Year Ended December
31,
2024
2023
% Change
2024
2023
% Change
Revenue
$
376,420
$
349,302
7.8
%
$
1,557,228
$
1,456,450
6.9
%
Cost of products sold
257,002
249,472
3.0
%
1,050,135
996,153
5.4
%
Selling and administrative expenses
77,422
91,767
(15.6
%)
315,514
305,274
3.4
%
Operating income
41,996
8,063
420.8
%
191,579
155,023
23.6
%
Interest expense
6,387
6,524
28,781
25,172
Earnings before income taxes
35,609
1,539
162,798
129,851
Income taxes
5,505
7,372
38,132
36,457
Net earnings
$
30,104
$
(5,833
)
616.1
%
$
124,666
$
93,394
33.5
%
Earnings per share of common stock: Basic
$
0.71
$
(0.14
)
$
2.96
$
2.22
Diluted
$
0.71
$
(0.14
)
$
2.94
$
2.21
Average common shares outstanding: Basic
42,163
42,051
42,145
42,027
Diluted
42,454
42,051
42,396
42,242
Results by Segment
Three Months Ended December
31,
Year Ended December
31,
Revenue
2024
2023
% Change
2024
2023
% Change
Flavors & Extracts
$
188,114
$
182,939
2.8
%
$
793,698
$
741,072
7.1
%
Color
158,134
141,396
11.8
%
647,939
607,959
6.6
%
Asia Pacific
41,861
33,202
26.1
%
162,525
146,090
11.2
%
Intersegment elimination
(11,689
)
(8,235
)
(46,934
)
(38,671
)
Consolidated
$
376,420
$
349,302
7.8
%
$
1,557,228
$
1,456,450
6.9
%
Operating Income
Flavors & Extracts
$
21,345
$
18,059
18.2
%
$
97,094
$
87,773
10.6
%
Color
26,542
21,343
24.4
%
119,529
105,370
13.4
%
Asia Pacific
8,495
5,889
44.3
%
34,458
30,800
11.9
%
Corporate & Other
(14,386
)
(37,228
)
(59,502
)
(68,920
)
Consolidated
$
41,996
$
8,063
420.8
%
$
191,579
$
155,023
23.6
%
Sensient Technologies Corporation (In thousands)
(Unaudited) Consolidated Condensed Balance
Sheets
December 31,
December 31,
2024
2023
Cash and cash equivalents
$
26,626
$
28,934
Trade accounts receivable
290,087
272,164
Inventories
600,302
598,399
Prepaid expenses and other current assets
44,871
37,119
Total Current Assets
961,886
936,616
Goodwill & intangible assets (net)
423,658
436,177
Property, plant, and equipment (net)
491,587
505,277
Other assets
146,663
136,437
Total Assets
$
2,023,794
$
2,014,507
Trade accounts payable
$
139,052
$
131,114
Short-term borrowings
19,848
13,460
Other current liabilities
111,739
91,732
Total Current Liabilities
270,639
236,306
Long-term debt
613,523
645,085
Accrued employee and retiree benefits
24,499
27,715
Other liabilities
54,147
52,077
Shareholders' Equity
1,060,986
1,053,324
Total Liabilities and Shareholders' Equity
$
2,023,794
$
2,014,507
Sensient Technologies Corporation (In thousands, except
per share amounts) (Unaudited) Consolidated
Statements of Cash Flows Year Ended December 31,
2024
2023
Cash flows from operating activities: Net earnings
$
124,666
$
93,394
Adjustments to arrive at net cash provided by operating activities:
Depreciation and amortization
60,329
57,820
Share-based compensation expense
10,084
8,933
Net (gain) loss on assets
(140
)
541
Portfolio Optimization Plan costs
1,415
24,089
Deferred income taxes
(18,598
)
(5,100
)
Changes in operating assets and liabilities: Trade accounts
receivable
(29,638
)
35,801
Inventories
(18,295
)
(28,193
)
Prepaid expenses and other assets
(5,407
)
5,767
Trade accounts payable and other accrued expenses
8,995
(5,978
)
Accrued salaries, wages, and withholdings
22,518
(17,830
)
Income taxes
(810
)
(1,175
)
Other liabilities
2,032
1,628
Net cash provided by operating activities
157,151
169,697
Cash flows from investing activities: Acquisition of
property, plant, and equipment
(59,212
)
(87,868
)
Proceeds from sale of assets
339
156
Acquisition of new businesses
-
(1,650
)
Other investing activities
(336
)
1,741
Net cash used in investing activities
(59,209
)
(87,621
)
Cash flows from financing activities: Proceeds from
additional borrowings
159,321
351,662
Debt payments
(167,073
)
(355,161
)
Dividends paid
(69,399
)
(69,222
)
Other financing activities
(4,395
)
(9,278
)
Net cash used in financing activities
(81,546
)
(81,999
)
Effect of exchange rate changes on cash and cash equivalents
(18,704
)
7,936
Net (decrease) increase in cash and cash equivalents
(2,308
)
8,013
Cash and cash equivalents at beginning of period
28,934
20,921
Cash and cash equivalents at end of period
$
26,626
$
28,934
Supplemental Information Year Ended December
31,
2024
2023
Dividends paid per share
$
1.64
$
1.64
Sensient Technologies Corporation (In thousands, except
percentages and per share amounts) (Unaudited)
Reconciliation of Non-GAAP Amounts The Company's
results for the three and twelve months ended December 31, 2024 and
2023 include adjusted operating income, adjusted net earnings, and
adjusted diluted earnings per share, which, in each case, exclude
Portfolio Optimization Plan costs.
Three Months Ended December
31,
Year Ended December
31,
2024
2023
% Change
2024
2023
% Change
Operating income (GAAP)
$
41,996
$
8,063
420.8
%
$
191,579
$
155,023
23.6
%
Portfolio Optimization Plan costs – Cost of products sold
839
3,135
1,362
3,135
Portfolio Optimization Plan costs – Selling and administrative
expenses
17
24,706
5,269
24,706
Adjusted operating income
$
42,852
$
35,904
19.4
%
$
198,210
$
182,864
8.4
%
Net earnings (GAAP)
$
30,104
$
(5,833
)
616.1
%
$
124,666
$
93,394
33.5
%
Portfolio Optimization Plan costs, before tax
856
27,841
6,631
27,841
Tax impact of Portfolio Optimization Plan costs(1)
(3,570
)
(415
)
(4,156
)
(415
)
Adjusted net earnings
$
27,390
$
21,593
26.8
%
$
127,141
$
120,820
5.2
%
Diluted earnings per share (GAAP)
$
0.71
$
(0.14
)
607.1
%
$
2.94
$
2.21
33.0
%
Portfolio Optimization Plan costs, net of tax
(0.06
)
0.65
0.06
0.65
Adjusted diluted earnings per share
$
0.65
$
0.51
27.5
%
$
3.00
$
2.86
4.9
%
Note: Earnings per share calculations may not foot due to
rounding differences. (1) Tax impact adjustments were
determined based on the nature of the underlying non-GAAP
adjustments and their relevant jurisdictional tax rates.
Results by Segment
Three Months Ended December
31,
Adjusted
Adjusted
Operating Income
2024
Adjustments(2)
2024
2023
Adjustments(2)
2023
Flavors & Extracts
$
21,345
$
-
$
21,345
$
18,059
$
-
$
18,059
Color
26,542
-
26,542
21,343
-
21,343
Asia Pacific
8,495
-
8,495
5,889
-
5,889
Corporate & Other
(14,386
)
856
(13,530
)
(37,228
)
27,841
(9,387
)
Consolidated
$
41,996
$
856
$
42,852
$
8,063
$
27,841
$
35,904
Results by Segment
Year Ended December
31,
Adjusted
Adjusted
Operating Income
2024
Adjustments(2)
2024
2023
Adjustments(2)
2023
Flavors & Extracts
$
97,094
$
-
$
97,094
$
87,773
$
-
$
87,773
Color
119,529
-
119,529
105,370
-
105,370
Asia Pacific
34,458
-
34,458
30,800
-
30,800
Corporate & Other
(59,502
)
6,631
(52,871
)
(68,920
)
27,841
(41,079
)
Consolidated
$
191,579
$
6,631
$
198,210
$
155,023
$
27,841
$
182,864
(2) Adjustments consist of Portfolio Optimization Plan
costs.
Sensient Technologies Corporation (In thousands,
except percentages) (Unaudited) Reconciliation
of Non-GAAP Amounts - Continued The following table
summarizes the percentage change in the 2024 results compared to
the 2023 results for the corresponding periods.
Three
Months Ended December 31, 2024 Revenue Total
ForeignExchangeRates Adjustments(3)
AdjustedLocalCurrency Flavors & Extracts
2.8
%
(0.6
%)
N/A
3.4
%
Color
11.8
%
(2.2
%)
N/A
14.0
%
Asia Pacific
26.1
%
0.9
%
N/A
25.2
%
Total Revenue
7.8
%
(1.1
%)
N/A
8.9
%
Operating Income Flavors & Extracts
18.2
%
(0.2
%)
0.0
%
18.4
%
Color
24.4
%
(3.0
%)
0.0
%
27.4
%
Asia Pacific
44.3
%
2.6
%
0.0
%
41.7
%
Corporate & Other
(61.4
%)
0.0
%
(105.5
%)
44.1
%
Total Operating Income
420.8
%
(6.7
%)
406.7
%
20.8
%
Diluted Earnings Per Share
607.1
%
(7.2
%)
584.9
%
29.4
%
Adjusted EBITDA
17.5
%
(1.3
%)
N/A
18.8
%
Year Ended December 31, 2024 Revenue
Total ForeignExchangeRates Adjustments(3)
AdjustedLocalCurrency Flavors & Extracts
7.1
%
0.0
%
N/A
7.1
%
Color
6.6
%
(0.7
%)
N/A
7.3
%
Asia Pacific
11.2
%
(1.8
%)
N/A
13.0
%
Total Revenue
6.9
%
(0.5
%)
N/A
7.4
%
Operating Income Flavors & Extracts
10.6
%
(0.2
%)
0.0
%
10.8
%
Color
13.4
%
(0.8
%)
0.0
%
14.2
%
Asia Pacific
11.9
%
(2.2
%)
0.0
%
14.1
%
Corporate & Other
(13.7
%)
0.0
%
(42.4
%)
28.7
%
Total Operating Income
23.6
%
(1.0
%)
15.3
%
9.3
%
Diluted Earnings Per Share
33.0
%
(1.4
%)
28.5
%
5.9
%
Adjusted EBITDA
7.6
%
(0.7
%)
N/A
8.3
%
(3) Adjustments consist of Portfolio Optimization Plan
costs.
Sensient Technologies Corporation (In thousands,
except percentages) (Unaudited) Reconciliation
of Non-GAAP Amounts - Continued The following table
summarizes the reconciliation between Consolidated Operating Income
(GAAP) and Adjusted EBITDA for the three and twelve months ended
December 31, 2024 and 2023.
Three Months Ended December
31,
Year Ended December
31,
2024
2023
% Change
2024
2023
% Change
Operating income (GAAP)
$
41,996
$
8,063
420.8%
$
191,579
$
155,023
23.6%
Depreciation and amortization
15,144
14,460
60,329
57,820
Share-based compensation expense
3,104
1,648
10,084
8,933
Portfolio Optimization Plan costs, before tax
856
27,841
6,631
27,841
Adjusted EBITDA
$
61,100
$
52,012
17.5%
$
268,623
$
249,617
7.6%
The following table summarizes the reconciliation between
Debt (GAAP) and Net Debt, and Operating Income (GAAP) and Credit
Adjusted EBITDA for the year ended December 31, 2024 and 2023.
Year Ended December
31,
Debt
2024
2023
Short-term borrowings
$
19,848
$
13,460
Long-term debt
613,523
645,085
Credit Agreement adjustments(4)
(13,129
)
(16,743
)
Net Debt
$
620,242
$
641,802
Operating income (GAAP)
$
191,579
$
155,023
Depreciation and amortization
60,329
57,820
Share-based compensation expense
10,084
8,933
Portfolio Optimization Plan costs, before tax
6,631
27,841
Other non-operating gains(5)
(905
)
(762
)
Credit Adjusted EBITDA
$
267,718
$
248,855
Net Debt to Credit Adjusted EBITDA 2.3x 2.6x
(4) Adjustments include cash and cash equivalents, as described in
the Company's Third Amended and Restated Credit Agreement (Credit
Agreement), and certain letters of credit and hedge contracts. (5)
Adjustments consist of certain financing transaction costs, certain
non-financing interest items, and gains and losses related to
certain non-cash, non-operating, and/or non-recurring items as
described in the Credit Agreement. We have included each of
these non-GAAP measures in order to provide additional information
regarding our underlying operating results and comparable
period-over-period performance. Such information is supplemental to
information presented in accordance with GAAP and is not intended
to represent a presentation in accordance with GAAP. These non-GAAP
measures should not be considered in isolation. Rather, they should
be considered together with GAAP measures and the rest of the
information included in this release and our SEC filings.
Management internally reviews each of these non-GAAP measures to
evaluate performance on a comparative period-to-period basis and to
gain additional insight into underlying operating and performance
trends, and we believe the information can be beneficial to
investors for the same purposes. These non-GAAP measures may not be
comparable to similarly titled measures used by other companies.
Category: Earnings
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250213674414/en/
Amy Agallar (414) 347-3706 investor.relations@sensient.com
Sensient Technologies (NYSE:SXT)
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