International Flavors & Fragrances Inc. (NYSE: IFF) reported
financial results for the fourth quarter and full year ended
December 31, 2022.
Fourth Quarter 2022 Consolidated Summary:
Reported (GAAP)
Adjusted
(Non-GAAP)1
Sales
Loss Before Taxes
EPS
Operating EBITDA
Operating EBITDA
Margin
EPS ex Amortization
$2.8 B
$(5) M
$0.01
$441 M
15.5%
$0.97
Full Year 2022 Consolidated Summary:
Reported (GAAP)
Adjusted
(Non-GAAP)1
Sales
Loss Before Taxes
EPS
Operating EBITDA
Operating EBITDA
Margin
EPS ex Amortization
$12.4 B
$(1.6) B
$(7.21)
$2.5 B
19.7%
$5.55
Management Commentary
“IFF delivered solid financial results in 2022 in what continues
to be a challenging operating environment,” said IFF CEO Frank
Clyburn. “Throughout the year our team successfully executed on
what we could control – pricing, productivity and portfolio
optimization – to generate strong sales growth, enhance
profitability and reduce our debt. At the same time, we introduced
a refreshed growth-focused strategy, that deepens our commitment to
customers, prioritizes our highest-return businesses, and expands
productivity to drive long-term profitable growth. We are confident
that these are the right strategies to navigate near-term
challenges – as we balance growth, profitability and cash flow
generation – and deliver long-term value creation for our
shareholders.”
Fourth Quarter 2022 Consolidated Financial
Results
- Reported net sales for the fourth quarter were $2.84 billion, a
decrease of 6% compared to the prior year period. On a comparable
basis2, currency neutral sales increased 4% versus the prior year
period, led by a double-digit increase in Pharma and mid-single
digit growth in Scent & Nourish.
- Loss before taxes on a reported basis for the fourth quarter
was $5 million. Adjusted operating EBITDA for the fourth quarter
was $441 million. On a combined basis2, currency neutral adjusted
operating EBITDA decreased 5% as strong pricing actions and
productivity gains were more than offset by lower volumes.
- Reported earnings per share (EPS) for the fourth quarter was
$0.01. Adjusted EPS excluding amortization was $0.97 per diluted
share.
______________________________ 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 full year 2022 is
defined as 12 months (January thru December) of legacy IFF and
N&B results in both the 2021 and 2022 periods, and excludes the
impact of divestitures and acquisitions. Comparable results for the
fourth quarter excludes the impact of divestitures and
acquisitions.
Fourth Quarter 2022 Segment Summary: Growth vs. Prior
Year
Reported (GAAP)
Adjusted (Non-GAAP)
Comparable Currency Neutral
(Non-GAAP)2
Comparable Currency Neutral
Adjusted (Non-GAAP)2
Sales
Operating EBITDA
Sales
Operating EBITDA
Nourish
(3)%
(22)%
4%
(11)%
Health & Biosciences
(22)%
(22)%
(3)%
(11)%
Scent
(2)%
8%
6%
25%
Pharma Solutions
8%
(12)%
15%
(10)%
Nourish Segment
- On a reported basis, sales were $1.58 billion. On a comparable
basis2, currency neutral sales improved 4%, with strong growth in
Food Design and Ingredients.
- Nourish adjusted operating EBITDA was $195 million and adjusted
operating EBITDA margin was 12.4% in the fourth quarter. On a
comparable basis2, currency neutral adjusted operating EBITDA
declined 11% as strong price increases and productivity gains were
offset by lower volumes.
Health & Biosciences Segment
- On a reported basis, sales were $501 million. On a comparable
basis2, currency neutral sales declined 3% compared against strong
double-digit growth in the prior year period. Performance was
driven by strong growth in Animal Nutrition, Cultures and Food
Enzymes that was more than offset by market-driven weakness in
Health and Grain Processing.
- Health & Biosciences adjusted operating EBITDA was $121
million and adjusted operating EBITDA margin was 24.2% in the
fourth quarter. On a comparable basis2, currency neutral adjusted
operating EBITDA declined 11% as price increases and productivity
gains were more than offset by lower volumes.
Scent Segment
- On a reported basis, sales were $545 million. On a comparable
basis2, currency neutral sales improved 6% led by strong
double-digit growth in Fine Fragrances and a mid single-digit
improvement in Consumer Fragrance.
- Scent adjusted operating EBITDA was $95 million and adjusted
operating EBITDA margin was 17.4% in the fourth quarter. On a
comparable basis2, currency neutral adjusted operating EBITDA grew
25% led by favorable mix, pricing and productivity gains.
Pharma Solutions Segment
- On a reported basis, sales were $221 million. On a comparable
basis2, currency neutral sales improved 15% led by strong
double-digit growth in Core Pharma.
- Pharma Solutions adjusted operating EBITDA was $30 million and
adjusted operating EBITDA margin was 13.6% in the fourth quarter.
On a comparable basis2, currency neutral adjusted operating EBITDA
declined 10% as price increases and productivity gains were more
than offset by lower volumes.
Full Year 2022 Consolidated Financial Results
- Reported net sales for the full year were $12.44 billion, an
increase of 7% compared to the prior year period. On a comparable
basis2, currency neutral sales increased 9%, with growth achieved
across all divisions, led by double-digit increases in Nourish and
Pharma.
- Loss before taxes on a reported basis for the full year was
$1.63 billion. Adjusted operating EBITDA for the full year was
$2.46 billion. On a comparable basis2, currency neutral adjusted
operating EBITDA increased 4%, as strong pricing and continued cost
discipline more than offset inflationary pressures and lower
volumes.
- Reported (loss) earnings per share (EPS) for the full year was
$(7.21). Adjusted EPS excluding amortization was $5.55 per diluted
share.
- Cash flow from operations for the full year was $345 million,
and free cash flow defined as cash flow from operations less
capital expenditures totaled $(159) million. Net debt to credit
adjusted EBITDA at the end of the fourth quarter was 4.1x.
Full Year 2022 Segment Summary: Growth vs. Prior Year
Reported (GAAP)
Adjusted (Non-GAAP)
Comparable Currency Neutral
(Non-GAAP)2
Comparable Currency Neutral
Adjusted (Non-GAAP)2
Sales
Operating EBITDA
Sales
Operating EBITDA
Nourish
9%
0%
11%
5%
Health & Biosciences
0%
1%
4%
(1)%
Scent
2%
(9)%
8%
1%
Pharma Solutions
20%
35%
15%
25%
Nourish Segment
- On a reported basis, sales were $6.83 billion. On a comparable
basis2, currency neutral sales improved 11% led by double-digit
growth in Food Design and Ingredients and a mid single-digit
increase in Flavors.
- Nourish adjusted operating EBITDA was $1.18 billion and
adjusted operating EBITDA margin was 17.2% for the full year. On a
comparable basis2, currency neutral adjusted operating EBITDA grew
5% led by strong price increases and productivity gains.
Health & Biosciences Segment
- On a reported basis, sales were $2.34 billion. On a comparable
basis2, currency neutral sales improved 4% with growth in nearly
all segments led by high single-digit increases in Cultures &
Food Enzymes and Animal Nutrition.
- Health & Biosciences adjusted operating EBITDA was $634
million and adjusted operating EBITDA margin was 27.1% for the full
year. On a comparable basis2, currency neutral adjusted operating
EBITDA declined 1% as price increases and productivity gains were
more than offset by lower volumes.
Scent Segment
- On a reported basis, sales were $2.30 billion. On a comparable
basis2, currency neutral sales improved 8% driven by strong
double-digit growth in Fine Fragrances, a high single-digit
increase in Fragrance Ingredients and a mid single-digit
performance in Consumer Fragrances.
- Scent adjusted operating EBITDA was $423 million and adjusted
operating EBITDA margin was 18.4% for the full year. On a
comparable basis2, currency neutral adjusted operating EBITDA grew
1% as strong volume growth, favorable mix and productivity were
offset due to the time lag between full price realization relative
to inflationary pressures.
Pharma Solutions Segment
- On a reported basis, sales were $971 million. On a comparable
basis2, currency neutral sales improved 15% led by double-digit
growth in Core Pharma.
- Pharma Solutions adjusted operating EBITDA was $222 million and
adjusted operating EBITDA margin was 22.9% for the full year. On a
comparable basis2, currency neutral adjusted operating EBITDA grew
25% led by volume growth, price increases and productivity
gains.
2023 Financial Guidance
The Company expects full year 2023 sales to be approximately
$12.5 billion, with an expected full year 2023 adjusted operating
EBITDA of approximately $2.34 billion. The Company's full year
guidance excludes approximately $350 million in sales and
approximately $50 million in adjusted operating EBITDA for the
anticipated Savory Solutions divestiture, which is expected to
close in the second quarter of 2023.
Comparable currency neutral sales growth for 2023 is expected to
be approximately 6%. On a comparable basis, full year 2022 sales
were approximately $11.875 billion, excluding approximately $565
million of sales related to the impact of divestitures and
acquisitions in current and prior year periods.
Comparable currency neutral adjusted operating EBITDA growth for
2023 is expected to be approximately flat versus prior year. On a
comparable basis, full year 2022 adjusted operating EBITDA was
approximately $2.37 billion, excluding approximately $85 million of
adjusted operating EBITDA related to the impact of divestitures and
acquisitions in current and prior year periods.
Based on current market foreign exchange rates, the Company
expects that foreign exchange will have zero impact to sales growth
and approximately a 1% 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 gains (losses) on
sale of fixed assets, shareholder activism related costs, business
divestiture costs including the anticipated Savory Solutions,
employee separation costs, N&B inventory step-up costs, N&B
transaction related costs, integration related costs and the impact
of the merger with N&B.
A copy of the Company’s Annual Report on Form 10-K will be
available on its website at www.iff.com or at www.sec.gov by March
1, 2023.
Audio Webcast
A live webcast to discuss the Company’s fourth quarter and full
year 2022 financial results will be held on February 9, 2023, at
9:00 a.m. ET. The webcast and accompanying slide presentation may
be accessed on the Company's IR website at ir.iff.com. For those
unable to listen to the live webcast, a recorded version will be
made available on the Company's website approximately one hour
after the event and will remain available on IFF’s website for one
year.
Cautionary Statement Under The Private
Securities Litigation Reform Act of 1995
Statements in this press release, which are not historical facts
or information, are “forward-looking statements” within the meaning
of The Private Securities Litigation Reform Act of 1995. Such
forward-looking statements are based on management’s current
assumptions, estimates and expectations including those concerning
the impacts of COVID-19 and our plans to respond to its
implications; the expected impact of global supply chain
challenges; expectations regarding sales and profit for the fiscal
year 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; the expected divestiture of
Savory Solutions and the progress of our portfolio optimization
strategy, through non-core business divestitures and acquisitions,
such as the Health Wright Products acquisition; our combination
with N&B, including the expected benefits and synergies of the
N&B Transaction and future opportunities for the combined
company; the success of our integration efforts and ability to
deliver on our synergy commitments as well as future opportunities
for the combined company; 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; 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 to 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 Russia-Ukraine conflict, or climate-change related
events (including severe weather events) that may affect our
suppliers or procurement of raw materials; (3) disruption in the
development, manufacture, distribution or sale of our products from
COVID-19 and other public health crises; (4) risks related to the
integration of the N&B business, including whether we will
realize and benefits anticipated from the merger in the expected
time frame; (5) our ability to successfully establish and manage
acquisitions, collaborations, joint ventures or partnerships, or
the failure to close strategic transactions or divestments; (6) our
ability to successfully market to our expanded and diverse customer
base; (7) our substantial amount of indebtedness and its impact on
our liquidity and ability to return capital to its shareholders;
(8) our ability to effectively compete in our market and develop
and introduce new products that meet customers’ needs; (9) our
ability to retain key employees; (10) changes in demand from large
multi-national customers due to increased competition and our
ability to maintain “core list” status with customers; (11) our
ability to successfully develop innovative and cost-effective
products that allow customers to achieve their own profitability
expectations; (12) disruption in the development, manufacture,
distribution or sale of our products from natural disasters, public
health crises, international conflicts, terrorist acts, labor
strikes, political crisis, accidents and similar events; (13) the
impact of a significant data breach or other disruption in our
information technology systems, and our ability to comply with data
protection laws in the U.S. and abroad; (14) volatility and
increases in the price of raw materials, energy and transportation;
(15) our ability to comply with, and the costs associated with
compliance with, regulatory requirements and industry standards,
including regarding product safety, quality, efficacy and
environmental impact; (16) our ability to meet increasing customer,
consumer, shareholder and regulatory focus on sustainability; (17)
defect, quality issues (including product recalls), inadequate
disclosure or misuse with respect to the products and capabilities;
(18) our ability to react in a timely and cost-effective manner to
changes in consumer preferences and demands, including increased
awareness of health and wellness; (19) our ability to benefit from
our investments and expansion in emerging markets; (20) the impact
of currency fluctuations or devaluations in the principal foreign
markets in which we operate; (21) economic, regulatory and
political risks associated with our international operations; (22)
the impact of global economic uncertainty on demand for consumer
products; (23) our ability to comply with, and the costs associated
with compliance with, U.S. and foreign environmental protection
laws; (24) our ability to successfully manage our working capital
and inventory balances; (25) the impact of the failure to comply
with U.S. or foreign anti-corruption and anti-bribery laws and
regulations, including the U.S. Foreign Corrupt Practices Act; (26)
any impairment on our tangible and intangible long lived assets,
including goodwill associated with the N&B merger and the
acquisition of Frutarom; (27) our ability to protect our
intellectual property rights; (28) the impact of the outcome of
legal claims, regulatory investigations and litigation; (29)
changes in market conditions or governmental regulations relating
to our pension and postretirement obligations; (30) the impact of
changes in federal, state, local and international tax legislation
or policies, including the Tax Cuts and Jobs Act, with respect to
transfer pricing and state aid, and adverse results of tax audits,
assessments, or disputes; (31) the impact of the United Kingdom’s
departure from the European Union; (32) the impact of the phase out
of the London Interbank Offered Rate (LIBOR) on interest expense;
and (33) risks associated with our CEO transition, including the
impact on employee hiring and retention.
The foregoing list of important factors does not include all
such factors, nor necessarily present them in order of importance.
In addition, you should consult other disclosures made by the
Company (such as in our other filings with the SEC or in company
press releases) for other factors that may cause actual results to
differ materially from those projected by the Company. Please refer
to Part I. Item 1A., Risk Factors, of the Company’s Annual Report
on Form 10-K filed with the SEC on February 28, 2022 for additional
information regarding factors that could affect our results of
operations, financial condition and liquidity.
We intend our forward-looking statements to speak only as of the
time of such statements and do not undertake or plan to update or
revise them as more information becomes available or to reflect
changes in expectations, assumptions or results. We can give no
assurance that such expectations or forward-looking statements will
prove to be correct. An occurrence of, or any material adverse
change in, one or more of the risk factors or risks and
uncertainties referred to in this press release or included in our
other periodic reports filed with the SEC could materially and
adversely impact our operations and our future financial results.
Any public statements or disclosures made by us following this
press release that modify or impact any of the forward-looking
statements contained in or accompanying this press release will be
deemed to modify or supersede such outlook or other forward-looking
statements in or accompanying this press release.
Use of Non-GAAP Financial
Measures
We provide in this press release non GAAP financial measures,
including: (i) comparable currency neutral sales; (ii) adjusted
operating EBITDA and comparable currency neutral adjusted operating
EBITDA; (iii) adjusted operating EBITDA margin; (iv) adjusted EPS
ex amortization; (v) free cash flow; and (vi) net debt to credit
adjusted EBITDA.
Our non-GAAP financial measures are defined below.
Currency Neutral metrics eliminate the effects that result from
translating non-U.S. currencies to U.S. dollars. We calculate
currency neutral numbers by translating current year invoiced sale
amounts at the exchange rates used for the corresponding prior year
period. We use currency neutral results in our analysis of
subsidiary or segment performance. We also use currency neutral
numbers when analyzing our performance against our competitors.
Adjusted operating EBITDA and adjusted operating EBITDA margin
exclude depreciation and amortization expense, interest expense,
other (expense) income, net, and certain non-recurring or unusual
items such as acquisition related costs, restructuring and other
charges, gains on sale of fixed assets, impairment of goodwill,
impairment of long-lived assets, shareholder activism related
costs, business divestiture costs, employee separation costs,
strategic initiative costs, Global Shared Services implementation
costs, Frutarom acquisition related costs, N&B inventory
step-up costs, N&B transaction related costs and integration
related costs.
Adjusted EPS ex Amortization excludes the impact of
non-operational items including, acquisition related costs,
restructuring and other charges, losses (gains) on sale of fixed
assets, impairment of goodwill, impairment of long-lived assets,
shareholder activism related costs, business divestiture costs,
gains on business disposal, employee separation costs, strategic
initiative costs, Global Shared Services implementation costs,
Frutarom acquisition related costs, integration related costs,
redemption value adjustment to EPS and non-cash items including the
amortization of acquisition related intangible assets.
Free Cash Flow is operating cash flow (i.e. cash flow from
operations) less capital expenditures.
Net debt to credit adjusted EBITDA is the leverage ratio used in
our credit agreements and defined as net debt (which is debt for
borrowed money less cash and cash equivalents) divided by the
trailing 12-month credit adjusted EBITDA. Credit adjusted EBITDA is
defined as income (loss) before income taxes, depreciation and
amortization expense, interest expense, specified items and
non-cash items.
Comparable results for full year 2022 is defined as 12 months
(January thru December) of legacy IFF and N&B results in both
the 2021 and 2022 periods, and excludes the impact of divestitures
and acquisitions. Comparable results for the fourth quarter
excludes 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 gains (losses) on sale of fixed assets, shareholder
activism related costs, business divestiture costs (including the
anticipated Savory Solutions divestiture), employee separation
costs, N&B inventory step-up costs, N&B transaction related
costs, integration related costs and the impact of the merger with
N&B.
Welcome to IFF
At IFF (NYSE: IFF), an industry leader in food, beverage, scent,
health and biosciences, science and creativity meet to create
essential solutions for a better world – from global icons to
unexpected innovations and experiences. With the beauty of art and
the precision of science, we are an international collective of
thinkers who partners with customers to bring scents, tastes,
experiences, ingredients and solutions for products the world
craves. Together, we will do more good for people and planet. Learn
more at iff.com, Twitter, Facebook, Instagram, and LinkedIn.
International Flavors &
Fragrances Inc.
Consolidated Statements of
Income (Loss)
(Amounts in millions except
per share data)
(Unaudited)
Three Months Ended December
31,
Year Ended December
31,
2022
2021
% Change
2022
2021
% Change
Net sales
$
2,844
$
3,031
(6
)%
$
12,440
$
11,656
7
%
Cost of goods sold
1,975
2,050
(4
)%
8,289
7,921
5
%
Gross profit
869
981
(11
)%
4,151
3,735
11
%
Research and development expenses
143
166
(14
)%
603
629
(4
)%
Selling and administrative expenses
440
450
(2
)%
1,768
1,749
1
%
Restructuring and other charges
7
7
—
%
12
41
(71
)%
Amortization of acquisition-related
intangibles
175
185
(5
)%
727
732
(1
)%
Impairment of goodwill
—
—
NMF
2,250
—
NMF
Impairment of long-lived assets
—
—
NMF
120
—
NMF
Gains on sale of fixed assets
(1
)
—
NMF
(3
)
(1
)
200
%
Operating profit (loss)
105
173
(39
)%
(1,326
)
585
NMF
Interest expense
104
73
42
%
336
289
16
%
Other expense (income), net
6
(14
)
(143
)%
(37
)
(58
)
(36
)%
(Loss) income before taxes
(5
)
114
(104
)%
(1,625
)
354
NMF
(Benefit from) provision for income
taxes
(9
)
22
(141
)%
211
75
181
%
Net income (loss)
4
92
(96
)%
(1,836
)
279
NMF
Net income attributable to non-controlling
interest
1
2
(50
)%
7
9
(22
)%
Net income (loss) attributable to IFF
shareholders
$
3
$
90
(97
)%
$
(1,843
)
$
270
NMF
Net income (loss) per share - basic
(1)
$
0.01
$
0.35
$
(7.21
)
$
1.11
Net income (loss) per share - diluted
(1)
$
0.01
$
0.35
$
(7.21
)
$
1.10
Average number of shares outstanding -
basic
255
255
255
243
Average number of shares outstanding -
diluted
255
255
255
243
(1)
Net income (loss) per share
reflects adjustments related to the redemption value of certain
redeemable non-controlling interests.
NMF
Not meaningful
International Flavors &
Fragrances Inc.
Condensed Consolidated Balance
Sheets
(Amounts in millions)
(Unaudited)
December 31,
2022
2021
Cash, cash equivalents and restricted
cash
$
493
$
715
Receivables, net
1,818
1,906
Inventories
3,151
2,516
Other current assets
1,970
1,850
Total current assets
7,432
6,987
Property, plant and equipment, net
4,203
4,368
Goodwill and other intangibles, net
22,437
26,920
Other assets
1,318
1,383
Total assets
$
35,390
$
39,658
Short-term borrowings
$
597
$
632
Other current liabilities
3,141
3,001
Total current liabilities
3,738
3,633
Long-term debt
10,373
10,768
Non-current liabilities
3,486
4,035
Redeemable non-controlling interests
59
105
Shareholders' equity
17,734
21,117
Total liabilities and shareholders'
equity
$
35,390
$
39,658
International Flavors &
Fragrances Inc.
Consolidated Statements of
Cash Flows
(Amounts in millions)
(Unaudited)
Year Ended December
31,
2022
2021
Cash flows from operating
activities:
Net (loss) income
$
(1,836
)
$
279
Adjustments to reconcile to net cash
provided by operations:
Depreciation and amortization
1,179
1,156
Deferred income taxes
(294
)
(236
)
(Gains) losses on sale of fixed assets
(3
)
(1
)
Gains on business divestiture
(11
)
—
Stock-based compensation
49
54
Pension contributions
(36
)
(37
)
Amortization of inventory step-up
—
368
Impairment of goodwill
2,250
—
Impairment of long-lived assets
120
—
Changes in assets and liabilities, net of
acquisitions:
Trade receivables
(117
)
(169
)
Inventories
(893
)
(363
)
Accounts payable
(57
)
419
Accruals for incentive compensation
(34
)
96
Other current payables and accrued
expenses
101
4
Other assets/liabilities, net
(73
)
(127
)
Net cash provided by operating
activities
345
1,443
Cash flows from investing
activities:
Cash paid for acquisitions, net of cash
received
(110
)
—
Additions to property, plant and
equipment
(504
)
(393
)
Additions to intangible assets
(2
)
(4
)
Proceeds from disposal of assets
8
18
Proceeds from unwinding of derivative
instruments
173
—
Cash provided by the Merger with
N&B
11
246
Net proceeds received from business
divestiture
1,169
115
Net cash provided by (used in) investing
activities
745
(18
)
Cash flows from financing
activities:
Cash dividends paid to shareholders
(810
)
(667
)
Dividends paid to redeemable
non-controlling interest
—
(2
)
Increase (decrease) in revolving credit
facility and short term borrowings
104
(105
)
Proceeds from issuance of commercial paper
(maturities after three months)
225
—
Repayments of commercial paper (maturities
after three months)
(421
)
—
Net borrowings of commercial paper
(maturities less than three months)
48
324
Deferred financing costs
—
(3
)
Repayments of long-term debt
(300
)
(828
)
Purchases of redeemable non-controlling
interest
(47
)
—
Proceeds from issuance of long-term
debt
—
3
Contingent consideration paid
—
(14
)
Employee withholding taxes paid
(21
)
(21
)
Other, net
(7
)
3
Net cash used in financing activities
(1,229
)
(1,310
)
Effect of exchange rate changes on cash,
cash equivalents and restricted cash
(77
)
(59
)
Net change in cash, cash equivalents
and restricted cash
(216
)
56
Cash, cash equivalents and restricted cash
at beginning of year
716
660
Cash, cash equivalents and restricted
cash at end of year
$
500
$
716
The following table reconciles cash, cash equivalents and
restricted cash between the Company's statement of cash flows for
the periods ended December 31, 2022 and December 31, 2021 to the
amounts reported in the Company's balance sheet:
AMOUNTS IN
MILLIONS
December 31, 2022
December 31, 2021
December 31, 2020
Current assets
Cash and cash equivalents
$
483
$
711
$
650
Restricted cash
10
4
7
Noncurrent assets
Restricted cash included in Other
assets
7
1
3
Cash, cash equivalents and restricted
cash
$
500
$
716
$
660
International Flavors &
Fragrances Inc.
Reportable Segment
Performance
(Amounts in millions)
(Unaudited)
Three Months Ended December
31,
Year Ended December
31,
2022
2021
2022
2021
Net Sales
Nourish
$
1,577
$
1,626
$
6,829
$
6,264
Health & Biosciences
501
646
2,339
2,329
Scent
545
555
2,301
2,254
Pharma Solutions
221
204
971
809
Consolidated
$
2,844
$
3,031
$
12,440
$
11,656
Segment Adjusted Operating
EBITDA
Nourish
$
195
$
251
$
1,176
$
1,172
Health & Biosciences
121
156
634
625
Scent
95
88
423
463
Pharma Solutions
30
34
222
165
Total
441
529
2,455
2,425
Depreciation & Amortization
(282
)
(295
)
(1,179
)
(1,156
)
Interest Expense
(104
)
(73
)
(336
)
(289
)
Other (expense) income, net
(6
)
14
37
58
Acquisition Related Costs
6
—
4
—
Restructuring and Other Charges
(7
)
(7
)
(12
)
(41
)
Gains on Sale of Fixed Assets
1
—
3
1
Impairment of Goodwill
—
—
(2,250
)
—
Impairment of Long-Lived Assets
—
—
(120
)
—
Shareholder Activism Related Costs
—
—
(3
)
(7
)
Business Divestiture Costs
(19
)
(21
)
(110
)
(42
)
Employee Separation Costs
(7
)
(1
)
(11
)
(29
)
Strategic Initiative Costs
(3
)
—
(3
)
—
Global Shared Services Implementation
Costs
(4
)
—
(5
)
—
Frutarom Acquisition Related Costs
—
(2
)
(1
)
(2
)
N&B Inventory Step-Up Costs
—
(5
)
—
(368
)
N&B Transaction Related Costs
—
—
—
(91
)
Integration Related Costs
(21
)
(25
)
(94
)
(105
)
(Loss) Income Before Taxes
$
(5
)
$
114
$
(1,625
)
$
354
Segment Adjusted Operating EBITDA
Margin
Nourish
12.4
%
15.4
%
17.2
%
18.7
%
Health & Biosciences
24.2
%
24.1
%
27.1
%
26.8
%
Scent
17.4
%
15.9
%
18.4
%
20.5
%
Pharma Solutions
13.6
%
16.7
%
22.9
%
20.4
%
Consolidated
15.5
%
17.5
%
19.7
%
20.8
%
International Flavors & Fragrances
Inc. GAAP to Non-GAAP Reconciliation
(Unaudited)
The following information and schedules provide
reconciliation information between reported GAAP amounts and
non-GAAP certain adjusted amounts. This information and schedules
are not intended as, and should not be viewed as, a substitute for
reported GAAP amounts or financial statements of the Company
prepared and presented in accordance with GAAP.
Reconciliation of Gross
Profit
Fourth Quarter
(DOLLARS IN MILLIONS)
2022
2021
Reported (GAAP)
$
869
$
981
N&B Inventory Step-Up Costs
—
5
Integration Related Costs (h)
—
1
Adjusted (Non-GAAP)
$
869
$
987
Reconciliation of Selling and
Administrative Expenses
Fourth Quarter
(DOLLARS IN MILLIONS)
2022
2021
Reported (GAAP)
$
440
$
450
Acquisition Related Costs (a)
6
—
Business Divestiture Costs (b)
(19
)
(21
)
Employee Separation Costs (c)
(7
)
(1
)
Strategic Initiative Costs (d)
(3
)
—
Global Shared Services Implementation
Costs (e)
(4
)
—
Frutarom Acquisition Related Costs (g)
—
(2
)
Integration Related Costs (h)
(21
)
(23
)
Adjusted (Non-GAAP)
$
392
$
403
International Flavors & Fragrances
Inc. GAAP to Non-GAAP Reconciliation (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 Net (Loss)
Income and EPS
Fourth Quarter
2022
2021
(DOLLARS IN MILLIONS)
(Loss) income before
taxes
Benefit from income taxes
(i)
Net income attributable to IFF
(j)
Diluted EPS (k)
Income before taxes
Provision for income taxes
(i)
Net income attributable to IFF
(j)
Diluted EPS
Reported (GAAP)
$
(5
)
$
(9
)
$
3
$
0.01
$
114
$
22
$
90
$
0.35
Acquisition Related Costs (a)
(6
)
(1
)
(5
)
(0.02
)
—
—
—
—
Restructuring and Other Charges
7
1
6
0.02
7
2
5
0.02
Losses (Gains) on Sale of Fixed Assets
(1
)
—
(1
)
—
—
—
—
—
Business Divestiture Costs (b)
19
(73
)
92
0.36
21
5
16
0.06
Gains on Business Disposal
3
14
(11
)
(0.04
)
(13
)
(14
)
1
0.01
Employee Separation Costs (c)
7
—
7
0.03
1
—
1
—
Strategic Initiative Costs (d)
3
1
2
0.01
—
—
—
—
Global Shared Services Implementation
Costs (e)
4
1
3
0.01
—
—
—
—
Pension Settlement (f)
—
—
—
—
2
—
2
0.01
Frutarom Acquisition Related Costs (g)
—
—
—
—
2
—
2
0.01
N&B Inventory Step-Up Costs
—
—
—
—
5
—
5
0.02
Integration Related Costs (h)
21
5
16
0.07
25
6
19
0.07
Adjusted (Non-GAAP)
$
52
$
(61
)
$
112
$
0.44
$
164
$
21
$
141
$
0.55
Reconciliation of Adjusted
(Non-GAAP) EPS ex. Amortization
Fourth Quarter
(DOLLARS AND SHARE AMOUNTS IN
MILLIONS)
2022
2021
Numerator
Adjusted (Non-GAAP) Net Income
$
112
$
141
Amortization of Acquisition related
Intangible Assets
175
185
Tax impact on Amortization of Acquisition
related Intangible Assets (i)
40
45
Amortization of Acquisition related
Intangible Assets, net of tax (l)
135
140
Adjusted (Non-GAAP) Net Income ex.
Amortization
$
247
$
281
Denominator
Weighted average shares assuming dilution
(diluted)
255
255
Adjusted (Non-GAAP) EPS ex.
Amortization
$
0.97
$
1.10
(a)
Represents costs related to the
acquisition of Health Wright Products, primarily consulting and
legal fees, offset in part by earn out adjustments.
(b)
Represents costs related to the Company's
sales and planned sales of businesses, primarily legal and
professional fees.
(c)
Represents costs related to severance,
including accelerated stock compensation expense, for certain
employees and executives who have been separated or will separate
from the Company.
(d)
Represents costs related to the Company's
strategic assessment and business portfolio optimization efforts,
primarily consulting fees.
(e)
Represents costs related to the Company's
efforts of restructuring the Global Shared Services Centers,
primarily consulting fees.
(f)
Represents pension settlement charges
incurred in one of the Company's UK pension plans.
(g)
Represents transaction-related costs and
expenses related to the acquisition of Frutarom, primarily includes
earn-out payments, net of adjustments.
(h)
Represents costs related to integration
activities since 2018, primarily for Frutarom and N&B. For
2022, represents costs primarily related to external consulting
fees and internal integration costs, including salaries of
individuals who are fully dedicated to integration efforts. For
2021, represents costs primarily related to performance stock
awards and consulting fees for advisory services.
(i)
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.
(j)
For 2022 and 2021, net income is reduced
by income attributable to non-controlling interest of $1 million
and $2 million, respectively.
(k)
The sum of these items does not foot due
to rounding.
(l)
Represents all amortization of intangible
assets acquired in connection with acquisitions, net of tax.
International Flavors & Fragrances
Inc. GAAP to Non-GAAP Reconciliation
(Unaudited)
The following information and schedules provide
reconciliation information between reported GAAP amounts and
non-GAAP certain adjusted amounts. This information and schedules
are not intended as, and should not be viewed as, a substitute for
reported GAAP amounts or financial statements of the Company
prepared and presented in accordance with GAAP.
Reconciliation of Gross
Profit
Year Ended December
31,
(DOLLARS IN MILLIONS)
2022
2021
Reported (GAAP)
$
4,151
$
3,735
Employee Separation Costs (f)
—
1
N&B Inventory Step-Up Costs
—
368
Integration Related Costs (m)
2
4
Adjusted (Non-GAAP)
$
4,153
$
4,108
Reconciliation of Selling and
Administrative Expenses
Year Ended December
31,
(DOLLARS IN MILLIONS)
2022
2021
Reported (GAAP)
$
1,768
$
1,749
Acquisition Related Costs (a)
4
—
Restructuring and Other Charges
—
(1
)
Shareholder Activism Related Costs (d)
(3
)
(7
)
Business Divestiture Costs (e)
(110
)
(42
)
Employee Separation Costs (f)
(11
)
(27
)
Strategic Initiative Costs (g)
(3
)
—
Global Shared Services Implementation
Costs (h)
(5
)
—
Frutarom Acquisition Related Costs (k)
(1
)
(2
)
N&B Transaction Related Costs (l)
—
(91
)
Integration Related Costs (m)
(92
)
(99
)
Adjusted (Non-GAAP)
$
1,547
$
1,480
International Flavors & Fragrances
Inc. GAAP to Non-GAAP Reconciliation (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 Net (Loss)
Income and EPS
Year Ended December
31,
2022
2021
(DOLLARS IN MILLIONS)
(Loss) income before
taxes
Provision for income taxes
(o)
Net (loss) income attributable
to IFF (p)
Diluted EPS
Income before taxes
Provision for income taxes
(o)
Net income attributable to IFF
(p)
Diluted EPS
Reported (GAAP)
$
(1,625
)
$
211
$
(1,843
)
$
(7.21
)
$
354
$
75
$
270
$
1.10
Acquisition Related Costs (a)
(4
)
—
(4
)
(0.02
)
—
—
—
—
Restructuring and Other Charges
12
2
10
0.04
41
9
32
0.13
Losses (Gains) on Sale of Fixed Assets
(3
)
(1
)
(2
)
(0.01
)
(1
)
—
(1
)
—
Impairment of Goodwill (b)
2,250
—
2,250
8.81
—
—
—
—
Impairment of Long-Lived Assets (c)
120
24
96
0.38
—
—
—
—
Shareholder Activism Related Costs (d)
3
1
2
0.01
7
2
5
0.02
Business Divestiture Costs (e)
110
(70
)
180
0.70
42
10
32
0.12
Gains on Business Disposal
(11
)
(96
)
85
0.34
(13
)
(14
)
1
0.01
Employee Separation Costs (f)
11
1
10
0.04
29
2
27
0.11
Strategic Initiative Costs (g)
3
1
2
0.01
—
—
—
—
Global Shared Services Implementation
Costs (h)
5
1
4
0.01
—
—
—
—
Pension Income Adjustment (i)
—
—
—
—
(17
)
(4
)
(13
)
(0.05
)
Pension Settlement (j)
—
—
—
—
2
—
2
0.01
Frutarom Acquisition Related Costs (k)
1
—
1
—
2
—
2
0.01
N&B Inventory Step-Up Costs
—
—
—
—
368
79
289
1.19
N&B Transaction Related Costs (l)
—
—
—
—
91
19
72
0.29
Integration Related Costs (m)
94
23
71
0.28
105
24
81
0.33
Redemption value adjustment to EPS (n)
—
—
—
(0.01
)
—
—
—
0.01
Adjusted (Non-GAAP)
$
966
$
97
$
862
$
3.37
$
1,010
$
202
$
799
$
3.28
Reconciliation of Adjusted
(Non-GAAP) EPS ex. Amortization
Year Ended December
31,
(DOLLARS AND SHARE AMOUNTS IN
MILLIONS)
2022
2021
Numerator
Adjusted (Non-GAAP) Net Income
$
862
$
799
Amortization of Acquisition related
Intangible Assets
727
732
Tax impact on Amortization of Acquisition
related Intangible Assets (o)
170
158
Amortization of Acquisition related
Intangible Assets, net of tax (q)
557
574
Adjusted (Non-GAAP) Net Income ex.
Amortization
$
1,419
$
1,373
Denominator
Weighted average shares assuming dilution
(diluted)
255
244
Adjusted (Non-GAAP) EPS ex.
Amortization
$
5.55
$
5.63
(a)
Represents costs related to the
acquisition of Health Wright Products, primarily consulting and
legal fees, offset in part by earn out adjustments.
(b)
Represents costs related to the
impairment of goodwill in the Health & Biosciences reporting
unit.
(c)
Represents costs related to the
impairment of intangible and fixed assets of an asset group that
operates primarily in Russia.
(d)
Represents shareholder activist
related costs, primarily professional fees.
(e)
Represents costs related to the
Company's sales and planned sales of businesses, primarily legal
and professional fees.
(f)
Represents costs related to
severance, including accelerated stock compensation expense, for
certain employees and executives who have been separated or will
separate from the Company.
(g)
Represents costs related to the
Company's strategic assessment and business portfolio optimization
efforts, primarily consulting fees.
(h)
Represents costs related to the
Company's efforts of restructuring the Global Shared Services
Centers, primarily consulting fees.
(i)
Represents catch-up of net
pension income from prior periods that had been excluded from their
respective periods.
(j)
Represents pension settlement
charges incurred in one of the Company's UK pension plans.
(k)
Represents transaction-related
costs and expenses related to the acquisition of Frutarom,
primarily includes earn-out payments, net of adjustments.
(l)
Represents transaction costs and
expenses related to the transaction with N&B, primarily legal
and professional fees.
(m)
Represents costs related to
integration activities since 2018, primarily for Frutarom and
N&B. For 2022, represents costs primarily related to external
consulting fees and internal integration costs, including salaries
of individuals who are fully dedicated to integration efforts. For
2021, represents costs primarily related to performance stock
awards and consulting fees for advisory services.
(n)
Represents the adjustment to EPS
related to the excess of the redemption value of certain redeemable
non-controlling interests over their existing carrying value.
(o)
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.
(p)
For 2022, net loss is increased
by income attributable to non-controlling interest of $7 million.
For 2021, net income is reduced by income attributable to
non-controlling interest of $9 million.
(q)
Represents all amortization of intangible
assets acquired in connection with acquisitions, net of tax.
International Flavors & Fragrances
Inc. Debt Covenants (Amounts in millions)
(Unaudited)
The following information and schedules provide
reconciliation information between reported GAAP amounts and
non-GAAP certain adjusted amounts. This information and schedules
are not intended as, and should not be viewed as, a substitute for
reported GAAP amounts or financial statements of the Company
prepared and presented in accordance with GAAP.
Reconciliation of Credit
Adjusted EBITDA to Net Loss
(DOLLARS IN
MILLIONS)
Year Ended December 31,
2022
Net loss
$
(1,843
)
Interest expense
336
Income taxes
211
Depreciation and amortization
1,179
Specified items(1)
2,605
Non-cash items(2)
35
Credit Adjusted EBITDA
$
2,523
_______________________
(1)
Specified items for the 12 months
ended December 31, 2022 of $2.605 billion, consisted of acquisition
related costs, restructuring and other charges, impairment of
goodwill, impairment of long-lived assets, shareholder activism
related costs, business divestiture costs, employee separation
costs, strategic initiative costs, Global Shared Services
implementation costs, Frutarom acquisition related costs and
integration related costs.
(2)
Non-cash items represent all
other adjustments to reconcile net (loss) income to net cash
provided by operations as presented on the Statements of Cash
Flows, including gains on sale of fixed assets, gains on business
disposal and stock-based compensation.
Net Debt to Total Debt
(DOLLARS IN
MILLIONS)
December 31, 2022
Total debt(1)
$
10,987
Adjustments:
Cash and cash equivalents(2)
535
Net debt
$
10,452
_______________________
(1)
Total debt used for the calculation of net
debt consists of short-term debt, long-term debt, short-term
finance lease obligations and long-term finance lease
obligations.
(2)
Cash and cash equivalents includes
approximately $52 million currently in Assets Held for Sale on the
Consolidated Balance Sheets.
International Flavors & Fragrances
Inc. Comparable Reportable Segment Performance
(Amounts in millions) (Unaudited)
The following information and schedule provides
reconciliation information between reported GAAP amounts and
non-GAAP certain adjusted amounts. This information and schedule is
not intended as, and should not be viewed as, a substitute for
reported GAAP amounts or financial statements of the Company
prepared and presented in accordance with GAAP.
Three Months Ended December
31,
Year Ended December
31,
2022
2021
2022
2021
Net Sales
Nourish(1)
$
1,577
$
1,626
$
6,829
$
6,458
Health & Biosciences(2)
486
538
2,281
2,302
Scent
545
555
2,301
2,254
Pharma Solutions
221
204
971
880
Consolidated
$
2,829
$
2,923
$
12,382
$
11,894
Segment Adjusted Operating
EBITDA
Nourish(1)
$
195
$
252
$
1,176
$
1,202
Health & Biosciences(2)
120
147
633
667
Scent
95
88
423
463
Pharma Solutions
30
34
222
182
Total
440
521
2,454
2,514
Depreciation & Amortization
(282
)
(295
)
(1,179
)
(1,156
)
Interest Expense
(104
)
(73
)
(336
)
(289
)
Other (expense) income, net
(6
)
14
37
58
Acquisition Related Costs
6
—
4
—
Restructuring and Other Charges
(7
)
(7
)
(12
)
(41
)
Gains on Sale of Fixed Assets
1
—
3
1
Impairment of Goodwill
—
—
(2,250
)
—
Impairment of Long-Lived Assets
—
—
(120
)
—
Shareholder Activism Related Costs
—
—
(3
)
(7
)
Business Divestiture Costs
(19
)
(21
)
(110
)
(42
)
Employee Separation Costs
(7
)
(1
)
(11
)
(29
)
Strategic Initiative Costs
(3
)
—
(3
)
—
Global Shared Services Implementation
Costs
(4
)
—
(5
)
—
Frutarom Acquisition Related Costs
—
(2
)
(1
)
(2
)
Compliance Review & Legal Defense
Costs
—
—
—
—
N&B Inventory Step-Up Costs
—
(5
)
—
(368
)
N&B Transaction Related Costs
—
—
—
(91
)
Integration Related Costs
(21
)
(25
)
(94
)
(105
)
Impact of Business Divestitures(3)
—
8
—
18
Impact of Business Acquisitions(4)
1
—
1
—
Impact of Merger with N&B(5)
—
—
—
(107
)
(Loss) Income Before Taxes
$
(5
)
$
114
$
(1,625
)
$
354
Segment Adjusted Operating EBITDA
Margin
Nourish
12.4
%
15.5
%
17.2
%
18.6
%
Health & Biosciences
24.7
%
27.3
%
27.8
%
29.0
%
Scent
17.4
%
15.9
%
18.4
%
20.5
%
Pharma Solutions
13.6
%
16.7
%
22.9
%
20.7
%
Consolidated
15.6
%
17.8
%
19.8
%
21.1
%
(1)
Nourish sales and segment adjusted
operating EBITDA information for the fourth quarter and year ended
December 31, 2021 exclude the results of the Fruit Preparation
business to present fully comparable scenarios of the Company due
to divestiture of the business in the fourth quarter of 2021. As a
result, there is no impact of the Fruit Preparation business for
the 2022 period.
(2)
Health & Biosciences sales and segment
adjusted operating EBITDA information for the fourth quarter and
year ended December 31, 2022 exclude the results of Health Wright
Products and for the fourth quarter and year ended December 31,
2021 exclude the results of the Microbial Control business unit to
present fully comparable scenarios of the Company as the
acquisition of Health Wright Products was completed on April 1,
2022 and the divestiture of the Microbial Control business unit was
completed on July 1, 2022. As a result, there was no impact from
Health Wright Products and the Microbial Control business unit for
the 2021 and 2022 periods, respectively.
(3)
Information related to the amounts exclude
the results of the Fruit Preparation business and Microbial Control
business unit to present fully comparable scenarios of the Company
due to divestiture of the businesses in the fourth quarter of 2021
and third quarter of 2022, respectively.
(4)
Information related to the amounts exclude
the results of Health Wright Products to present fully comparable
scenarios of the Company as the acquisition of Health Wright
Products was completed on April 1, 2022.
(5)
Information related to the amounts
included from merger with N&B was received directly from DuPont
and management believes such information is reliable. DuPont has
not provided the underlying adjustments for the amounts included,
but based on management's review of financial statement and other
scheduled information provided, we believe the amounts reflected
are reasonable. For the year ended December 31, 2021, amounts
include N&B results for January 2021 to reflect the same period
N&B is included in IFF results in 2022.
The pro forma historical segment
information has been presented for informational purposes only and
is not necessarily indicative of what IFF's results of operations
actually would have been, had the N&B transaction occurred on
the date indicated below. In addition, the pro forma historical
segment information does not purport to project the future
operating results of the Company, shown below:
(DOLLARS IN
MILLIONS)
January 2021
Pro Forma Sales
Pro Forma Adjusted Operating
EBITDA
Nourish
$
247
$
37
Health & Biosciences
189
53
Scent
—
—
Pharma Solutions
71
17
International Flavors &
Fragrances Inc.
GAAP to Non-GAAP
Reconciliation
Comparable Foreign Exchange
Impact
(Unaudited)
Q4 Nourish
Sales
Segment Adjusted Operating
EBITDA
Segment Adjusted Operating
EBITDA Margin
% Change - Reported
(3
)%
(22
)%
(3.0
)%
Portfolio Impact
0
%
0
%
(0.1
)%
% Change - Comparable
(3
)%
(23
)%
(3.1
)%
Currency Impact
7
%
12
%
0.9
%
% Change - Currency Neutral
4
%
(11
)%
(2.2
)%
Q4 Health & Biosciences
Sales
Segment Adjusted Operating
EBITDA
Segment Adjusted Operating
EBITDA Margin
% Change - Reported
(22
)%
(22
)%
0.1
%
Portfolio Impact
13
%
4
%
(2.7
)%
% Change - Comparable
(10
)%
(18
)%
(2.6
)%
Currency Impact
7
%
7
%
0.3
%
% Change - Currency Neutral
(3
)%
(11
)%
(2.3
)%
Q4 Scent
Sales
Segment Adjusted Operating
EBITDA
Segment Adjusted Operating
EBITDA Margin
% Change - Reported
(2
)%
8
%
1.5
%
Portfolio Impact
0
%
0
%
0.0
%
% Change - Comparable
(2
)%
8
%
1.5
%
Currency Impact
8
%
17
%
1.4
%
% Change - Currency Neutral
6
%
25
%
2.9
%
Q4 Pharma Solutions
Sales
Segment Adjusted Operating
EBITDA
Segment Adjusted Operating
EBITDA Margin
% Change - Reported
8
%
(12
)%
(3.1
)%
Portfolio Impact
0
%
0
%
0.0
%
% Change - Comparable
8
%
(12
)%
(3.1
)%
Currency Impact
7
%
2
%
(0.4
)%
% Change - Currency Neutral
15
%
(10
)%
(3.5
)%
Q4 Consolidated
Sales
Adjusted Operating
EBITDA
Adjusted Operating EBITDA
Margin
% Change - Reported
(6
)%
(17
)%
(2.0
)%
Portfolio Impact
3
%
1
%
(0.2
)%
% Change - Comparable
(3
)%
(16
)%
(2.2
)%
Currency Impact
7
%
11
%
0.7
%
% Change - Currency Neutral
4
%
(5
)%
(1.5
)%
_______________________
Note: The sum of these items may not foot
due to rounding.
International Flavors &
Fragrances Inc.
GAAP to Non-GAAP
Reconciliation
Comparable Foreign Exchange
Impact
(Unaudited)
YTD
Nourish
Sales
Segment Adjusted Operating
EBITDA
Segment Adjusted Operating
EBITDA Margin
% Change - Reported
9
%
0
%
(1.5
)%
Portfolio Impact
(3
)%
(3
)%
0.1
%
% Change - Comparable
6
%
(2
)%
(1.4
)%
Currency Impact
5
%
7
%
0.3
%
% Change - Currency Neutral
11
%
5
%
(1.1
)%
YTD Health &
Biosciences
Sales
Segment Adjusted Operating
EBITDA
Segment Adjusted Operating
EBITDA Margin
% Change - Reported
0
%
1
%
0.3
%
Portfolio Impact
(1
)%
(7
)%
(1.5
)%
% Change - Comparable
(1
)%
(5
)%
(1.2
)%
Currency Impact
5
%
4
%
(0.2
)%
% Change - Currency Neutral
4
%
(1
)%
(1.4
)%
YTD Scent
Sales
Segment Adjusted Operating
EBITDA
Segment Adjusted Operating
EBITDA Margin
% Change - Reported
2
%
(9
)%
(2.1
)%
Portfolio Impact
0
%
0
%
0.0
%
% Change - Comparable
2
%
(9
)%
(2.1
)%
Currency Impact
6
%
10
%
0.8
%
% Change - Currency Neutral
8
%
1
%
(1.3
)%
YTD Pharma
Solutions
Sales
Segment Adjusted Operating
EBITDA
Segment Adjusted Operating
EBITDA Margin
% Change - Reported
20
%
35
%
2.5
%
Portfolio Impact
(10
)%
(13
)%
(0.3
)%
% Change - Comparable
10
%
22
%
2.2
%
Currency Impact
5
%
3
%
(0.5
)%
% Change - Currency Neutral
15
%
25
%
1.7
%
YTD
Consolidated
Sales
Adjusted Operating
EBITDA
Adjusted Operating EBITDA
Margin
% Change - Reported
7
%
1
%
(1.1
)%
Portfolio Impact
(3
)%
(4
)%
(0.2
)%
% Change - Comparable
4
%
(2
)%
(1.3
)%
Currency Impact
5
%
6
%
0.3
%
% Change - Currency Neutral
9
%
4
%
(1.0
)%
_______________________
Note: The sum of these items may not foot
due to rounding.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230208005674/en/
Media Relations: Paula Heinkel 332.877.5339
Media.request@iff.com
Investor Relations: Michael Bender 212.708.7263
Investor.Relations@iff.com
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