Sensient Technologies Corporation Reports Results for the Quarter Ended June 30, 2020
Sensient Technologies Corporation (NYSE: SXT) reported diluted earnings per share of 72 cents in the second quarter of 2020 compared to diluted earnings per share of 81 cents in the second quarter of 2019. Revenue was $323.1 million in this year’s second quarter compared to $339.2 million in the comparable period last year. Operating income was $42.1 million in the second quarter of 2020 compared to operating income of $47.4 million in last year’s second quarter. Foreign currency translation decreased revenue, operating income, and earnings per share by approximately 3% in the quarter.
The 2020 second quarter reported results include a gain related to the reclassification of accumulated foreign currency translation as a result of the sale of the Inks business and other divestiture related costs, which primarily consist of non-cash impairment charges. The combination of these items are included within the divestiture & other related costs, which increased second quarter net earnings by $1.0 million ($0.02 per diluted share). The 2020 and 2019 second quarter results also include the operations of the product lines divested and to be divested, which were not significant to net earnings or diluted earnings per share. These adjustments are described in more detail under “Reconciliation of Non-GAAP Amounts” at the end of this release.
BUSINESS REVIEW |
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|
|
|
||
Reported |
||||
| Revenue | Quarter |
|
Year-to-date |
|
| Flavors & Fragrances | 1.9% |
|
1.8% |
|
| Color | -12.7% |
|
-6.4% |
|
| Asia Pacific | -3.9% |
|
1.4% |
|
| Total Revenue | -4.7% |
|
-1.9% |
|
|
|
|
||
Adjusted |
||||
Local Currency (1) |
||||
| Revenue | Quarter |
|
Year-to-date |
|
| Flavors & Fragrances | 5.7% |
|
4.6% |
|
| Color | -5.1% |
|
-1.1% |
|
| Asia Pacific | -1.4% |
|
3.5% |
|
| Total Revenue | 0.0% |
|
1.6% |
|
|
|
|
||
| (1) Adjusted local currency percentage changes are described in more detail in the "Reconciliation of Non-GAAP Amounts" at the end of this release. |
||||
The reported results include the impact of foreign currency, which is described in more detail under “Reconciliation of Non-GAAP Amounts” at the end of this release. In contrast, the non-GAAP amounts eliminate the impact of currency movements, depreciation and amortization, non-cash share-based compensation, divestiture & other related costs, and the results of the operations divested and to be divested 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.
The Flavors & Fragrances Group reported second quarter revenue of $183.6 million compared to $180.1 million reported in the comparable period last year. Adjusted local currency revenue increased 5.7% in the quarter. The higher revenue was primarily the result of continued growth in finished flavors and extracts and natural ingredients during the quarter. Segment operating income was $22.8 million in the second quarter compared to $20.0 million reported in the second quarter of 2019. The Group’s higher profit was primarily a result of higher volumes and the favorable impact of the Group’s cost reduction initiatives, offset by higher raw material costs, mainly in natural ingredients. Foreign currency translation decreased segment revenue by approximately 2% and operating income by approximately 1% in the quarter.
The Color Group reported revenue of $121.3 million in the quarter compared to $138.9 million in last year’s second quarter. Adjusted local currency revenue decreased 5.1% in the quarter. Segment operating income was $22.3 million in the quarter compared to $27.9 million in last year’s comparable period. Continued growth in natural food and beverage colors and higher revenue in the pharmaceutical business was offset by lower volumes in the Personal Care and Inks businesses. Color Group operating income was lower in the quarter as higher profit in the Food & Beverage Colors business was offset by significantly lower profit in the Personal Care and Inks businesses, primarily as a result of the lower demand during COVID-19. Foreign currency translation decreased segment revenue and operating income each by approximately 4% in the quarter.
The Asia Pacific Group reported revenue of $27.9 million in the quarter compared to $29.0 million in the second quarter of 2019. Adjusted local currency revenue decreased 1.4% in the quarter. The lower segment revenue was primarily due to the impact of COVID-19 regulatory restrictions in certain countries. Segment operating income was $4.8 million in the quarter compared to $4.2 million in last year’s second quarter. Adjusted local currency operating income increased 16.4% in the quarter. The higher profit was primarily a result of the favorable impact of the Group’s cost reduction initiatives and favorable product mix. Foreign currency translation decreased segment revenue by approximately 3% and operating income by approximately 1% in the quarter.
Corporate & Other reported operating costs of $7.7 million in the current quarter compared to $4.8 million in the second quarter of 2019. The higher costs are primarily due to an increase in non-cash performance-based compensation, partially offset by the divestiture & other related impacts in the current period.
During the second quarter, the Company completed the sale of its Inks product line within the Color Group. The Company also signed a definitive agreement for the sale of its yogurt fruit preparations product line within the Flavors & Fragrances Group, which is expected to close in the third quarter.
2020 OUTLOOK
Based upon current trends, the Company’s current diluted earnings per share guidance for 2020 is $2.10 to $2.35. This guidance now includes 35 to 40 cents per share of divestiture & other related costs and the results of the operations divested and to be divested. The Company’s previously issued diluted earnings per share guidance for 2020 was $1.85 to $2.15, which included 55 to 65 cents per share of divestiture & other related costs and the results of the operations divested and to be divested. The Company’s guidance continues to include approximately 10 cents of foreign currency headwinds based on current exchanges rates.
Based upon current trends, the Company reconfirms its previously issued guidance of $2.60 to $2.80 for adjusted diluted earnings per share(2), which excludes divestiture & other related costs, the results of the operations divested and to be divested, and foreign currency impacts.
The following table summarizes the Company’s 2020 Outlook:
| Previous Guidance |
Current Guidance |
|||||||||||
| Diluted Earnings Per Share (GAAP) | $ |
1.85 |
$ |
2.15 |
$ |
2.10 |
$ |
2.35 |
||||
| Divestiture & Other Costs and Results of Operations Divested and to be Divested |
|
0.65 |
|
0.55 |
|
0.40 |
|
0.35 |
||||
| Foreign Currency Headwinds |
|
0.10 |
|
0.10 |
|
0.10 |
|
0.10 |
||||
| Adjusted Diluted Earnings Per Share in Local Currency | $ |
2.60 |
$ |
2.80 |
$ |
2.60 |
$ |
2.80 |
||||
The Company is also confirming, based upon current trends, its previously issued guidance, which calls for low to mid-single digit revenue growth in 2020 on a local currency basis, excluding the revenues of the product lines divested and to be divested. The Company also continues to expect 2020 Adjusted EBITDA(2) to grow at a low to mid-single digit rate and Adjusted Operating Income(2) to be flat to down at a low-single digit rate, in each case on a local currency basis. Adjusted Operating Income will be impacted by higher non-cash performance-based compensation.
The full impact of COVID-19 remains unknown and continues to create uncertainty. The Company will continue to monitor the impact of COVID-19 and will update the outlook at each of the quarterly calls this year, as appropriate.
(2) See “Reconciliation of Non-GAAP Amounts” at the end of this release for more information.
CONFERENCE CALL
The Company will host a conference call to discuss its 2020 second quarter financial results at 8:30 a.m. CDT on Friday, July 17, 2020. 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 July 24, 2020, by calling (877) 344-7529 and referring to conference identification number 10144621. 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 July 21, 2020.
This release contains statements that may constitute “forward-looking statements” within the meaning of Federal securities laws including under “2020 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 impact and uncertainty created by the ongoing COVID-19 pandemic, including, but not limited to, its effects on our employees, facilities, customers and suppliers, the availability and cost of raw materials and other supplies, logistics and transportation, governmental regulations and restrictions and general economic conditions; 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 and changing technologies; the Company’s ability to successfully implement its growth strategies; the outcome of the Company’s various productivity-improvement and cost-reduction efforts and acquisition and divestiture activities; the success of the Company’s efforts to explore strategic alternatives for certain non-core product lines; the effectiveness of the Company’s past restructuring activities; changes in costs of raw materials, including energy; industry, regulatory, legal, and economic factors related to the Company’s domestic and international business; the effects of tariffs, trade barriers, and disputes; growth in markets for products in which the Company competes; industry and customer acceptance of price increases; actions by competitors; 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, 2019, the Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, 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, cosmetic, 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.
| Sensient Technologies Corporation | ||||||||||||||||||||||
| (In thousands, except percentages and per share amounts) | ||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||
| Consolidated Statements of Earnings | Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||
2020 |
2019 |
% Change |
2020 |
2019 |
% Change |
|||||||||||||||||
| Revenue | $ |
323,090 |
|
$ |
339,186 |
|
(4.7 |
%) |
$ |
673,767 |
|
$ |
686,699 |
|
(1.9 |
%) |
||||||
| Cost of products sold |
|
220,876 |
|
|
227,418 |
|
(2.9 |
%) |
|
459,660 |
|
|
459,706 |
|
(0.0 |
%) |
||||||
| Selling and administrative expenses |
|
60,089 |
|
|
64,400 |
|
(6.7 |
%) |
|
137,421 |
|
|
130,205 |
|
5.5 |
% |
||||||
| Operating income |
|
42,125 |
|
|
47,368 |
|
(11.1 |
%) |
|
76,686 |
|
|
96,788 |
|
(20.8 |
%) |
||||||
| Interest expense |
|
3,608 |
|
|
5,200 |
|
|
7,915 |
|
|
10,602 |
|
||||||||||
| Earnings before income taxes |
|
38,517 |
|
|
42,168 |
|
|
68,771 |
|
|
86,186 |
|
||||||||||
| Income taxes |
|
7,897 |
|
|
7,837 |
|
|
17,378 |
|
|
19,048 |
|
||||||||||
| Net earnings | $ |
30,620 |
|
$ |
34,331 |
|
(10.8 |
%) |
$ |
51,393 |
|
$ |
67,138 |
|
(23.5 |
%) |
||||||
| Earnings per share of common stock: | ||||||||||||||||||||||
| Basic | $ |
0.72 |
|
$ |
0.81 |
|
$ |
1.22 |
|
$ |
1.59 |
|
||||||||||
| Diluted | $ |
0.72 |
|
$ |
0.81 |
|
$ |
1.21 |
|
$ |
1.59 |
|
||||||||||
| Average common shares outstanding: | ||||||||||||||||||||||
| Basic |
|
42,305 |
|
|
42,270 |
|
|
42,294 |
|
|
42,255 |
|
||||||||||
| Diluted |
|
42,322 |
|
|
42,300 |
|
|
42,315 |
|
|
42,287 |
|
||||||||||
| Results by Segment | Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||
Revenue |
2020 |
2019 |
% Change |
2020 |
2019 |
% Change |
||||||||||||||||
| Flavors & Fragrances | $ |
183,611 |
|
$ |
180,134 |
|
1.9 |
% |
$ |
370,109 |
|
$ |
363,687 |
|
1.8 |
% |
||||||
| Color |
|
121,296 |
|
|
138,912 |
|
(12.7 |
%) |
|
264,791 |
|
|
282,791 |
|
(6.4 |
%) |
||||||
| Asia Pacific |
|
27,873 |
|
|
29,002 |
|
(3.9 |
%) |
|
58,322 |
|
|
57,521 |
|
1.4 |
% |
||||||
| Intersegment elimination |
|
(9,690 |
) |
|
(8,862 |
) |
|
(19,455 |
) |
|
(17,300 |
) |
||||||||||
| Consolidated | $ |
323,090 |
|
$ |
339,186 |
|
(4.7 |
%) |
$ |
673,767 |
|
$ |
686,699 |
|
(1.9 |
%) |
||||||
| Operating Income | ||||||||||||||||||||||
| Flavors & Fragrances | $ |
22,752 |
|
$ |
20,050 |
|
13.5 |
% |
$ |
43,623 |
|
$ |
43,175 |
|
1.0 |
% |
||||||
| Color |
|
22,263 |
|
|
27,877 |
|
(20.1 |
%) |
|
51,927 |
|
|
58,076 |
|
(10.6 |
%) |
||||||
| Asia Pacific |
|
4,849 |
|
|
4,201 |
|
15.4 |
% |
|
9,908 |
|
|
8,419 |
|
17.7 |
% |
||||||
| Corporate & Other |
|
(7,739 |
) |
|
(4,760 |
) |
|
(28,772 |
) |
|
(12,882 |
) |
||||||||||
| Consolidated | $ |
42,125 |
|
$ |
47,368 |
|
(11.1 |
%) |
$ |
76,686 |
|
$ |
96,788 |
|
(20.8 |
%) |
||||||
| Sensient Technologies Corporation | ||||||
| (In thousands) | ||||||
| (Unaudited) | ||||||
| Consolidated Condensed Balance Sheets | June 30, | December 31, | ||||
2020 |
2019 |
|||||
| Cash and cash equivalents | $ |
20,876 |
$ |
21,153 |
||
| Trade accounts receivable (net) |
|
229,635 |
|
213,201 |
||
| Inventories |
|
388,647 |
|
422,517 |
||
| Prepaid expenses and other current assets |
|
40,525 |
|
40,049 |
||
| Assets held for sale |
|
58,633 |
|
91,293 |
||
| Total Current Assets |
|
738,316 |
|
788,213 |
||
| Goodwill & intangible assets (net) |
|
415,111 |
|
418,844 |
||
| Property, plant, and equipment (net) |
|
423,294 |
|
437,179 |
||
| Other assets |
|
96,544 |
|
95,915 |
||
| Total Assets | $ |
1,673,265 |
$ |
1,740,151 |
||
| Trade accounts payable | $ |
97,296 |
$ |
94,653 |
||
| Short-term borrowings |
|
18,304 |
|
20,612 |
||
| Other current liabilities |
|
78,094 |
|
66,925 |
||
| Liabilities held for sale |
|
19,543 |
|
19,185 |
||
| Total Current Liabilities |
|
213,237 |
|
201,375 |
||
| Long-term debt |
|
537,680 |
|
598,499 |
||
| Accrued employee and retiree benefits |
|
26,023 |
|
25,822 |
||
| Other liabilities |
|
35,609 |
|
32,866 |
||
| Shareholders' Equity |
|
860,716 |
|
881,589 |
||
| Total Liabilities and Shareholders' Equity | $ |
1,673,265 |
$ |
1,740,151 |
||
| Sensient Technologies Corporation | ||||||||
| (In thousands, except per share amounts) | ||||||||
| (Unaudited) | ||||||||
| Consolidated Statements of Cash Flows | ||||||||
| Six Months Ended June 30, | ||||||||
2020 |
2019 |
|||||||
| Cash flows from operating activities: | ||||||||
| Net earnings | $ |
51,393 |
|
$ |
67,138 |
|
||
| Adjustments to arrive at net cash provided by operating activities: | ||||||||
| Depreciation and amortization |
|
24,522 |
|
|
27,741 |
|
||
| Share-based compensation expense (income) |
|
2,662 |
|
|
(1,155 |
) |
||
| Net loss (gain) on assets |
|
50 |
|
|
(75 |
) |
||
| Loss on divestitures |
|
6,634 |
|
|
- |
|
||
| Deferred income taxes |
|
1,075 |
|
|
(909 |
) |
||
| Changes in operating assets and liabilities: | ||||||||
| Trade accounts receivable |
|
(20,494 |
) |
|
(17,131 |
) |
||
| Inventories |
|
24,816 |
|
|
29,201 |
|
||
| Prepaid expenses and other assets |
|
(3,975 |
) |
|
(3,395 |
) |
||
| Accounts payable and other accrued expenses |
|
9,961 |
|
|
(21,401 |
) |
||
| Accrued salaries, wages and withholdings from employees |
|
6,483 |
|
|
(2,598 |
) |
||
| Income taxes |
|
3,899 |
|
|
(2,631 |
) |
||
| Other liabilities |
|
588 |
|
|
1,428 |
|
||
| Net cash provided by operating activities |
|
107,614 |
|
|
76,213 |
|
||
| Cash flows from investing activities: | ||||||||
| Acquisition of property, plant, and equipment |
|
(21,417 |
) |
|
(16,606 |
) |
||
| Proceeds from sale of assets |
|
6 |
|
|
91 |
|
||
| Proceeds from divesture of businesses |
|
11,255 |
|
|
- |
|
||
| Other investing activity |
|
4,395 |
|
|
(454 |
) |
||
| Net cash used in investing activities |
|
(5,761 |
) |
|
(16,969 |
) |
||
| Cash flows from financing activities: | ||||||||
| Proceeds from additional borrowings |
|
38,670 |
|
|
25,003 |
|
||
| Debt payments |
|
(98,849 |
) |
|
(55,182 |
) |
||
| Dividends paid |
|
(33,018 |
) |
|
(30,453 |
) |
||
| Other financing activity |
|
(414 |
) |
|
(1,028 |
) |
||
| Net cash used in financing activities |
|
(93,611 |
) |
|
(61,660 |
) |
||
| Effect of exchange rate changes on cash and cash equivalents |
|
(8,519 |
) |
|
397 |
|
||
| Net decrease in cash and cash equivalents |
|
(277 |
) |
|
(2,019 |
) |
||
| Cash and cash equivalents at beginning of period |
|
21,153 |
|
|
31,901 |
|
||
| Cash and cash equivalents at end of period | $ |
20,876 |
|
$ |
29,882 |
|
||
| Supplemental Information | ||||||||
| Six Months Ended June 30, | 2020 |
2019 |
||||||
| Dividends paid per share | $ |
0.78 |
|
$ |
0.72 |
|
||
Sensient Technologies Corporation |
||||||||||||||||||||||||
(In thousands, except percentages and per share amounts) |
||||||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||||||
Reconciliation of Non-GAAP Amounts |
||||||||||||||||||||||||
The Company's results for the three months ended June 30, 2020 and 2019 include adjusted revenue, adjusted operating income, adjusted net earnings, and adjusted diluted EPS, which exclude divestiture & other related costs and the results of operations divested or to be divested. |
||||||||||||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||
2020 |
2019 |
% Change | 2020 |
2019 |
% Change | |||||||||||||||||||
| Revenue (GAAP) | $ |
323,090 |
|
$ |
339,186 |
|
|
(4.7 |
%) |
$ |
673,767 |
|
$ |
686,699 |
|
|
(1.9 |
%) |
||||||
| Revenue of the product lines divested or to be divested |
|
(28,217 |
) |
|
(36,356 |
) |
|
(64,802 |
) |
|
(75,377 |
) |
||||||||||||
| Adjusted revenue | $ |
294,873 |
|
$ |
302,830 |
|
|
(2.6 |
%) |
$ |
608,965 |
|
$ |
611,322 |
|
|
(0.4 |
%) |
||||||
| Operating income (GAAP) | $ |
42,125 |
|
$ |
47,368 |
|
|
(11.1 |
%) |
$ |
76,686 |
|
$ |
96,788 |
|
|
(20.8 |
%) |
||||||
| Divestiture & other related costs – Cost of products sold |
|
1,749 |
|
|
- |
|
|
1,939 |
|
|
- |
|
||||||||||||
| Divestiture & other related costs (income) – Selling and administrative expenses |
|
(3,276 |
) |
|
- |
|
|
8,377 |
|
|
- |
|
||||||||||||
| Operating income of the product lines divested or to be divested |
|
(331 |
) |
|
(345 |
) |
|
(1,716 |
) |
|
(377 |
) |
||||||||||||
| Adjusted operating income | $ |
40,267 |
|
$ |
47,023 |
|
|
(14.4 |
%) |
$ |
85,286 |
|
$ |
96,411 |
|
|
(11.5 |
%) |
||||||
| Net earnings (GAAP) | $ |
30,620 |
|
$ |
34,331 |
|
|
(10.8 |
%) |
$ |
51,393 |
|
$ |
67,138 |
|
|
(23.5 |
%) |
||||||
| Divestiture & other related costs (income), before tax |
|
(1,527 |
) |
|
- |
|
|
10,316 |
|
|
- |
|
||||||||||||
| Tax impact of divestiture & other related costs |
|
509 |
|
|
- |
|
|
(425 |
) |
|
- |
|
||||||||||||
| Net earnings of the product lines divested or to be divested, before tax |
|
(331 |
) |
|
(345 |
) |
|
(1,716 |
) |
|
(377 |
) |
||||||||||||
| Tax impact of the product lines divested or to be divested |
|
203 |
|
|
105 |
|
|
500 |
|
|
116 |
|
||||||||||||
| Adjusted net earnings | $ |
29,474 |
|
$ |
34,091 |
|
|
(13.5 |
%) |
$ |
60,068 |
|
$ |
66,877 |
|
|
(10.2 |
%) |
||||||
| Diluted earnings per share (GAAP) | $ |
0.72 |
|
$ |
0.81 |
|
|
(11.1 |
%) |
$ |
1.21 |
|
$ |
1.59 |
|
|
(23.9 |
%) |
||||||
| Divestiture & other related costs (income), net of tax |
|
(0.02 |
) |
|
- |
|
|
0.23 |
|
|
- |
|
||||||||||||
| Result of operations of the product lines divested or to be divested, net of tax |
|
- |
|
|
(0.01 |
) |
|
(0.03 |
) |
|
(0.01 |
) |
||||||||||||
| Adjusted diluted earnings per share | $ |
0.70 |
|
$ |
0.81 |
|
|
(13.6 |
%) |
$ |
1.42 |
|
$ |
1.58 |
|
|
(10.1 |
%) |
||||||
| Note: Earnings per share calculations may not foot due to rounding differences. | ||||||||||||||||||||||||
| Results by Segment | Three Months Ended June 30, | |||||||||||||||||||||||
| Product Lines | Product Lines | |||||||||||||||||||||||
| divested or | Adjusted | divested or | Adjusted | |||||||||||||||||||||
Revenue |
2020 |
to be divested | 2020 |
2019 |
to be divested | 2019 |
||||||||||||||||||
| Flavors & Fragrances | $ |
183,611 |
|
$ |
(24,742 |
) |
$ |
158,869 |
|
$ |
180,134 |
|
$ |
(27,295 |
) |
$ |
152,839 |
|
||||||
| Color |
|
121,296 |
|
|
(3,501 |
) |
|
117,795 |
|
|
138,912 |
|
|
(9,134 |
) |
|
129,778 |
|
||||||
| Asia Pacific |
|
27,873 |
|
|
(213 |
) |
|
27,660 |
|
|
29,002 |
|
|
(218 |
) |
|
28,784 |
|
||||||
| Intersegment elimination |
|
(9,690 |
) |
|
239 |
|
|
(9,451 |
) |
|
(8,862 |
) |
|
291 |
|
|
(8,571 |
) |
||||||
| Consolidated | $ |
323,090 |
|
$ |
(28,217 |
) |
$ |
294,873 |
|
$ |
339,186 |
|
$ |
(36,356 |
) |
$ |
302,830 |
|
||||||
| Operating Income | ||||||||||||||||||||||||
| Flavors & Fragrances | $ |
22,752 |
|
$ |
(1,619 |
) |
$ |
21,133 |
|
$ |
20,050 |
|
$ |
(195 |
) |
$ |
19,855 |
|
||||||
| Color |
|
22,263 |
|
|
1,347 |
|
|
23,610 |
|
|
27,877 |
|
|
(95 |
) |
|
27,782 |
|
||||||
| Asia Pacific |
|
4,849 |
|
|
(59 |
) |
|
4,790 |
|
|
4,201 |
|
|
(55 |
) |
|
4,146 |
|
||||||
| Corporate & Other |
|
(7,739 |
) |
|
(1,527 |
) |
|
(9,266 |
) |
|
(4,760 |
) |
|
- |
|
|
(4,760 |
) |
||||||
| Consolidated | $ |
42,125 |
|
$ |
(1,858 |
) |
$ |
40,267 |
|
$ |
47,368 |
|
$ |
(345 |
) |
$ |
47,023 |
|
||||||
| Results by Segment | Six Months Ended June 30, | |||||||||||||||||||||||
| Product Lines | Product Lines | |||||||||||||||||||||||
| divested or | Adjusted | divested or | Adjusted | |||||||||||||||||||||
Revenue |
2020 |
to be divested | 2020 |
2019 |
to be divested | 2019 |
||||||||||||||||||
| Flavors & Fragrances | $ |
370,109 |
|
$ |
(52,187 |
) |
$ |
317,922 |
|
$ |
363,687 |
|
$ |
(56,101 |
) |
$ |
307,586 |
|
||||||
| Color |
|
264,791 |
|
|
(12,573 |
) |
|
252,218 |
|
|
282,791 |
|
|
(19,414 |
) |
|
263,377 |
|
||||||
| Asia Pacific |
|
58,322 |
|
|
(334 |
) |
|
57,988 |
|
|
57,521 |
|
|
(326 |
) |
|
57,195 |
|
||||||
| Intersegment elimination |
|
(19,455 |
) |
|
292 |
|
|
(19,163 |
) |
|
(17,300 |
) |
|
464 |
|
|
(16,836 |
) |
||||||
| Consolidated | $ |
673,767 |
|
$ |
(64,802 |
) |
$ |
608,965 |
|
$ |
686,699 |
|
$ |
(75,377 |
) |
$ |
611,322 |
|
||||||
| Operating Income | ||||||||||||||||||||||||
| Flavors & Fragrances | $ |
43,623 |
|
$ |
(2,837 |
) |
$ |
40,786 |
|
$ |
43,175 |
|
$ |
(88 |
) |
$ |
43,087 |
|
||||||
| Color |
|
51,927 |
|
|
1,214 |
|
|
53,141 |
|
|
58,076 |
|
|
(205 |
) |
|
57,871 |
|
||||||
| Asia Pacific |
|
9,908 |
|
|
(93 |
) |
|
9,815 |
|
|
8,419 |
|
|
(84 |
) |
|
8,335 |
|
||||||
| Corporate & Other |
|
(28,772 |
) |
|
10,316 |
|
|
(18,456 |
) |
|
(12,882 |
) |
|
- |
|
|
(12,882 |
) |
||||||
| Consolidated | $ |
76,686 |
|
$ |
8,600 |
|
$ |
85,286 |
|
$ |
96,788 |
|
$ |
(377 |
) |
$ |
96,411 |
|
||||||
Sensient Technologies Corporation |
||||||||||||||||||||||||
(In thousands, except percentages) |
||||||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||||||
Reconciliation of Non-GAAP Amounts - Continued |
||||||||||||||||||||||||
The following table summarizes the percentage change in the 2020 results compared to the 2019 results for the corresponding periods. |
||||||||||||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||
| Revenue | Total | Foreign Exchange Rates |
Product Lines Divested or to be Divested |
Adjusted Local Currency |
Total | Foreign Exchange Rates |
Product Lines Divested or to be Divested |
Adjusted Local Currency |
||||||||||||||||
Flavors & Fragrances |
1.9 |
% |
(2.0 |
%) |
(1.8 |
%) |
5.7 |
% |
1.8 |
% |
(1.5 |
%) |
(1.3 |
%) |
4.6 |
% |
||||||||
Color |
(12.7 |
%) |
(4.4 |
%) |
(3.2 |
%) |
(5.1 |
%) |
(6.4 |
%) |
(3.3 |
%) |
(2.0 |
%) |
(1.1 |
%) |
||||||||
Asia Pacific |
(3.9 |
%) |
(2.5 |
%) |
0.0 |
% |
(1.4 |
%) |
1.4 |
% |
(2.1 |
%) |
0.0 |
% |
3.5 |
% |
||||||||
| Total Revenue | (4.7 |
%) |
(2.9 |
%) |
(1.8 |
%) |
0.0 |
% |
(1.9 |
%) |
(2.3 |
%) |
(1.2 |
%) |
1.6 |
% |
||||||||
| Operating Income | ||||||||||||||||||||||||
Flavors & Fragrances |
13.5 |
% |
(1.3 |
%) |
6.8 |
% |
8.0 |
% |
1.0 |
% |
(1.1 |
%) |
6.2 |
% |
(4.1 |
%) |
||||||||
Color |
(20.1 |
%) |
(3.7 |
%) |
(4.5 |
%) |
(11.9 |
%) |
(10.6 |
%) |
(3.0 |
%) |
(2.1 |
%) |
(5.5 |
%) |
||||||||
Asia Pacific |
15.4 |
% |
(0.9 |
%) |
(0.1 |
%) |
16.4 |
% |
17.7 |
% |
0.0 |
% |
(0.1 |
%) |
17.8 |
% |
||||||||
Corporate & Other |
62.6 |
% |
0.0 |
% |
(32.1 |
%) |
94.7 |
% |
123.4 |
% |
0.0 |
% |
80.1 |
% |
43.3 |
% |
||||||||
| Total Operating Income | (11.1 |
%) |
(2.9 |
%) |
3.6 |
% |
(11.8 |
%) |
(20.8 |
%) |
(2.3 |
%) |
(9.1 |
%) |
(9.4 |
%) |
||||||||
| Diluted Earnings Per Share | (11.1 |
%) |
(2.5 |
%) |
1.3 |
% |
(9.9 |
%) |
(23.9 |
%) |
(2.5 |
%) |
(13.8 |
%) |
(7.6 |
%) |
||||||||
| Adjusted EBITDA | (6.7 |
%) |
(2.4 |
%) |
N/A |
|
(4.3 |
%) |
(6.3 |
%) |
(1.9 |
%) |
N/A |
|
(4.4 |
%) |
||||||||
| The following table summarizes the reconciliation between Operating Income (GAAP) and Adjusted EBITDA for the three and six months ended June 30, 2020 and 2019. | ||||||||||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
2020 |
2019 |
% Change | 2020 |
2019 |
% Change | |||||||||||||||||
| Operating income (GAAP) | $ |
42,125 |
|
$ |
47,368 |
|
(11.1 |
%) |
$ |
76,686 |
|
$ |
96,788 |
|
(20.8 |
%) |
||||||
| Depreciation and amortization |
|
12,118 |
|
|
14,069 |
|
|
24,522 |
|
|
27,741 |
|
||||||||||
| Depreciation and amortization, product lines divested or to be divested |
|
(16 |
) |
|
(1,526 |
) |
|
(96 |
) |
|
(3,022 |
) |
||||||||||
| Share-based compensation expense (income) |
|
1,485 |
|
|
(1,842 |
) |
|
2,662 |
|
|
(1,155 |
) |
||||||||||
| Divestiture & other related costs (income), before tax |
|
(1,527 |
) |
|
- |
|
|
10,316 |
|
|
- |
|
||||||||||
| Results of operations of the product lines divested or to be divested, before tax |
|
(331 |
) |
|
(345 |
) |
|
(1,716 |
) |
|
(377 |
) |
||||||||||
| Adjusted EBITDA | $ |
53,854 |
|
$ |
57,724 |
|
(6.7 |
%) |
$ |
112,374 |
|
$ |
119,975 |
|
(6.3 |
%) |
||||||
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/20200717005062/en/
