IFF Reports Third Quarter 2022 Results
IFF reported Q3 2022 results, revealing consolidated sales of $3.06 billion, flat year-over-year. A significant goodwill impairment charge of $2.25 billion was recorded due to increased interest rates and lower business projections. Adjusted EBITDA reached $612 million, with an operating margin of 20%. EPS was reported at $(8.60), while adjusted EPS was $1.36. The company revised its full-year sales guidance to $12.4-$12.5 billion, down from $12.6-$13.0 billion, citing adverse foreign exchange impacts. Nonetheless, the firm anticipates a 9-10% growth in comparable currency neutral sales.
- Adjusted operating EBITDA of $612 million, showing resilience amid challenging conditions.
- Comparable currency neutral sales growth of 9-10% projected for the full year 2022.
- Goodwill impairment charge of $2.25 billion due to adverse macroeconomic impacts.
- Reported EPS of $(8.60), indicating significant losses.
Third Quarter 2022 Consolidated Summary:
Reported (GAAP) |
|
Adjusted (Non-GAAP)1 |
||||||||
Sales |
|
Loss Before Taxes |
|
EPS |
|
Operating EBITDA |
|
Operating EBITDA Margin |
|
EPS ex Amortization |
|
|
|
|
|
|
|
|
|
|
|
First Nine Months 2022 Consolidated Summary:
Reported (GAAP) |
|
Adjusted (Non-GAAP)1 |
||||||||
Sales |
|
Loss Before Taxes |
|
EPS |
|
Operating EBITDA |
|
Operating EBITDA Margin |
|
EPS ex Amortization |
|
|
|
|
|
|
|
|
|
|
|
Impairment of
The Company has determined that for the third quarter of 2022 the carrying value of the Health & Biosciences reporting unit exceeded its fair value and recorded a goodwill impairment charge of
Management Commentary
“We delivered solid results in the third quarter in the context of a challenging operating environment," said IFF CEO
Third Quarter 2022 Consolidated Financial Results
-
Reported net sales for the third quarter were
$3.06 billion 10% versus the prior-year period, led by double-digit growth in Nourish and Pharma Solutions. -
Loss before taxes on a reported basis for the third quarter was
$(2.04) billion $612 million 3% versus the prior-year period, as strong pricing actions and productivity gains more than offset lower volumes. -
Reported earnings per share (EPS) for the third quarter was
$(8.60) $1.36 -
Cash flows from operations at the end of the third quarter was
$189 million $(155) million
______________________________
1 Schedules at the end of this release contain reconciliations of reported GAAP to Non-GAAP metrics. See Use of Non-GAAP Financial Measures for explanations of our Non-GAAP metrics.
2 Comparable results for the third quarter exclude the impact of divestitures in the prior and current year periods and acquisitions in the current year period.
Third 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 |
|
|
(12)% |
|
|
|
(4)% |
Health & Biosciences |
(17)% |
|
(9)% |
|
|
|
(1)% |
Scent |
|
|
(8)% |
|
|
|
|
Pharma Solutions |
|
|
|
|
|
|
|
Nourish Segment
-
On a reported basis, third quarter sales were
$1.70 billion 10% led by double-digit growth in Food Designs and Ingredients. -
Nourish adjusted operating EBITDA was
$287 million 16.9% in the third quarter. On a comparable basis2, currency neutral adjusted operating EBITDA declined4% as strong price increases and productivity gains were offset by lower volumes.
Health & Biosciences Segment
-
On a reported basis, third quarter sales were
$512 million 3% with growth in Cultures & Food Enzymes, Health, Home & Personal Care and Animal Nutrition. -
Health & Biosciences adjusted operating EBITDA was
$137 million 26.8% in the third quarter. On a comparable basis2, currency neutral adjusted operating EBITDA declined1% as price increases and productivity gains were principally offset by lower volumes.
Scent Segment
-
On a reported basis, third quarter sales were
$591 million 9% with mid-teen growth in Fine Fragrance and Fragrance Ingredients and a high single-digit increase in Consumer Fragrance. -
Scent adjusted operating EBITDA was
$119 million 20.1% in the third quarter. On a comparable basis2, currency neutral adjusted operating EBITDA grew3% led by volume growth, price increases and productivity gains.
Pharma Solutions Segment
-
On a reported basis, third quarter sales were
$257 million 28% with strong double-digit growth in Pharma and Industrial. -
Pharma Solutions adjusted operating EBITDA was
$69 million 26.8% in the third quarter. On a comparable basis2, currency neutral adjusted operating EBITDA grew76% led by volume growth, price increases and productivity gains.
Financial Guidance
The Company expects full year 2022 sales to be approximately
The Company expects to deliver comparable currency neutral sales growth of
Based on current market foreign exchange rates, the Company expects that foreign exchange will negatively impact sales growth in 2022 by approximately 5 percentage points and adjusted operating EBITDA growth by approximately 6 percentage points.
Audio Webcast
A live webcast to discuss the Company’s third quarter 2022 financial results will be held on
Cautionary Statement Under The Private Securities Litigation Reform Act of 1995
Statements in this press release, which are not historical facts or information, are “forward-looking statements” within the meaning of The Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on management’s current assumptions, estimates and expectations including those concerning the impacts of COVID-19 and our plans to respond to its implications; the expected impact of global supply chain challenges; expectations regarding sales and profit for the fiscal year 2022, 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; the divestiture of our Microbial Control business and the progress of our portfolio optimization strategy, through non-core business divestitures and acquisitions, such as the Health Wright acquisition; our combination with N&B, including the expected benefits and synergies of the N&B Transaction and future opportunities for the combined company, the success of our integration efforts and ability to deliver on our synergy commitments as well as future opportunities for the combined company; the impact of global economic uncertainty on demand for consumer products; the growth potential of the markets in which we operate, including the emerging markets, expected capital expenditures in 2022, the expected costs and benefits of our ongoing optimization of our manufacturing operations, including the expected number of closings, expected cash flow and availability of capital resources to fund our operations and meet our debt service requirements; our ability to innovate and execute on specific consumer trends and demands; our ability enhance our innovation efforts and drive cost efficiencies; our ability to continue to generate value for, and return cash to, our shareholders.
These forward-looking statements should be evaluated with consideration given to the many risks and uncertainties inherent in our business that could cause actual results and events to differ materially from those in the forward-looking statements. Certain of such forward-looking information may be identified by such terms as “expect,” “anticipate,” “believe,” “intend,” “outlook,” “may,” “estimate,” “should,” “predict” and similar terms or variations thereof. Such forward-looking statements are based on a series of expectations, assumptions, estimates and projections about the Company, are not guarantees of future results or performance, and involve significant risks, uncertainties and other factors, including assumptions and projections, for all forward periods. Our actual results may differ materially from any future results expressed or implied by such forward-looking statements.
Such risks, uncertainties and other factors include, among others, the following: (1) inflationary trends in the price of our input costs, such as raw materials, transportation and energy; (2) supply chain disruptions, geopolitical developments, including the
The foregoing list of important factors does not include all such factors, nor necessarily present them in order of importance. In addition, you should consult other disclosures made by the Company (such as in our other filings with the
We intend our forward-looking statements to speak only as of the time of such statements and do not undertake or plan to update or revise them as more information becomes available or to reflect changes in expectations, assumptions or results. We can give no assurance that such expectations or forward-looking statements will prove to be correct. An occurrence of, or any material adverse change in, one or more of the risk factors or risks and uncertainties referred to in this press release or included in our other periodic reports filed with the
Use of Non-GAAP Financial Measures
We provide in this press release non-GAAP financial measures, including: (i) comparable currency neutral sales; (ii) adjusted operating EBITDA and comparable currency neutral adjusted operating EBITDA; (iii) adjusted operating EBITDA margin; (iv) adjusted EPS ex amortization; (v) free cash flow; and (vi) net debt to credit adjusted EBITDA.
Our non-GAAP financial measures are defined below.
Currency Neutral metrics eliminate the effects that result from translating non-
Adjusted operating EBITDA and adjusted operating EBITDA margin exclude depreciation and amortization expense, interest expense, other income, net, restructuring and other charges and certain non-recurring items such as acquisition related costs, gains on sale of assets, impairment of goodwill, impairment of long-lived assets, shareholder activism related costs, business divestiture costs, employee separation costs, Global Shared Services implementation costs,
Adjusted EPS ex Amortization excludes the impact of non-operational items including, acquisition related costs, restructuring and other charges, gains on sale of assets, impairment of goodwill, impairment of long-lived assets, shareholder activism related costs, business divestiture costs, gains on business disposal, employee separation costs, Global Shared Services implementation costs, pension income adjustment,
Free Cash Flow is operating cash flow (i.e. cash flow from operations) less capital expenditures.
Net debt to credit adjusted EBITDA is the leverage ratio used in our credit agreements and defined as net debt (which is debt for borrowed money less cash and cash equivalents) divided by the trailing 12-month credit adjusted EBITDA. Credit adjusted EBITDA is defined as income (loss) before income taxes, depreciation and amortization expense, interest expense, specified items and non-cash items.
Comparable results for the third quarter excludes the impact of divestitures in the prior year period and acquisitions in the current year period.
These non-GAAP measures are intended to provide additional information regarding our underlying operating results and comparable year-over-year performance. Such information is supplemental to information presented in accordance with GAAP and is not intended to represent a presentation in accordance with GAAP. In discussing our historical and expected future results and financial condition, we believe it is meaningful for investors to be made aware of and to be assisted in a better understanding of, on a period-to-period comparable basis, financial amounts both including and excluding these identified items, as well as the impact of exchange rate fluctuations. These non-GAAP measures should not be considered in isolation or as substitutes for analysis of the Company’s results under GAAP and may not be comparable to other companies’ calculation of such metrics.
The Company cannot reconcile its expected Adjusted Operating EBITDA under "Financial Guidance" without unreasonable effort because certain items that impact net income and other reconciling metrics are out of the Company's control and/or cannot be reasonably predicted at this time. These items include but are not limited to gains (losses) on sale of assets, shareholder activism related costs, business divestiture costs, employee separation costs, N&B inventory step-up costs, N&B transaction related costs, integration related costs and the impact of the merger with N&B.
Welcome to IFF
At IFF (NYSE: IFF), an industry leader in food, beverage, scent, health and biosciences, science and creativity meet to create essential solutions for a better world – from global icons to unexpected innovations and experiences. With the beauty of art and the precision of science, we are an international collective of thinkers who partners with customers to bring scents, tastes, experiences, ingredients and solutions for products the world craves. Together, we will do more good for people and planet. Learn more at iff.com, Twitter, Facebook, Instagram, and LinkedIn.
Consolidated Statements of (Loss) Income
(Amounts in millions except per share data)
(Unaudited)
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||||
|
|
2022 |
|
|
|
2021 |
|
|
% Change |
|
|
2022 |
|
|
|
2021 |
|
|
% Change |
||
Net sales |
$ |
3,063 |
|
|
$ |
3,071 |
|
|
— |
% |
|
$ |
9,596 |
|
|
$ |
8,625 |
|
|
11 |
% |
Cost of goods sold |
|
2,062 |
|
|
|
1,981 |
|
|
4 |
% |
|
|
6,314 |
|
|
|
5,871 |
|
|
8 |
% |
Gross profit |
|
1,001 |
|
|
|
1,090 |
|
|
(8 |
) % |
|
|
3,282 |
|
|
|
2,754 |
|
|
19 |
% |
Research and development expenses |
|
145 |
|
|
|
156 |
|
|
(7 |
) % |
|
|
460 |
|
|
|
463 |
|
|
(1 |
) % |
Selling and administrative expenses |
|
413 |
|
|
|
436 |
|
|
(5 |
) % |
|
|
1,328 |
|
|
|
1,299 |
|
|
2 |
% |
Amortization of acquisition-related intangibles |
|
182 |
|
|
|
195 |
|
|
(7 |
) % |
|
|
552 |
|
|
|
547 |
|
|
1 |
% |
Impairment of goodwill |
|
2,250 |
|
|
|
— |
|
|
NMF |
|
|
2,250 |
|
|
|
— |
|
|
NMF |
||
Impairment of long-lived assets |
|
— |
|
|
|
— |
|
|
NMF |
|
|
120 |
|
|
|
— |
|
|
NMF |
||
Restructuring and other charges |
|
(4 |
) |
|
|
6 |
|
|
(167 |
) % |
|
|
5 |
|
|
|
34 |
|
|
(85 |
) % |
Gains on sales of fixed assets |
|
— |
|
|
|
(1 |
) |
|
(100 |
) % |
|
|
(2 |
) |
|
|
(1 |
) |
|
100 |
% |
Operating (loss) profit |
|
(1,985 |
) |
|
|
298 |
|
|
NMF |
|
|
(1,431 |
) |
|
|
412 |
|
|
NMF |
||
Interest expense |
|
83 |
|
|
|
74 |
|
|
12 |
% |
|
|
232 |
|
|
|
216 |
|
|
7 |
% |
Other income, net |
|
(33 |
) |
|
|
(26 |
) |
|
27 |
% |
|
|
(43 |
) |
|
|
(44 |
) |
|
(2 |
) % |
(Loss) Income before taxes |
|
(2,035 |
) |
|
|
250 |
|
|
NMF |
|
|
(1,620 |
) |
|
|
240 |
|
|
NMF |
||
Provision for income taxes |
|
160 |
|
|
|
53 |
|
|
202 |
% |
|
|
220 |
|
|
|
53 |
|
|
NMF |
|
Net (loss) income |
|
(2,195 |
) |
|
|
197 |
|
|
NMF |
|
|
(1,840 |
) |
|
|
187 |
|
|
NMF |
||
Net income attributable to noncontrolling interests |
|
2 |
|
|
|
3 |
|
|
(33 |
) % |
|
|
6 |
|
|
|
7 |
|
|
(14 |
) % |
Net (loss) income attributable to IFF shareholders |
$ |
(2,197 |
) |
|
$ |
194 |
|
|
NMF |
|
$ |
(1,846 |
) |
|
$ |
180 |
|
|
NMF |
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net (loss) income per share - basic (1) |
$ |
(8.60 |
) |
|
$ |
0.76 |
|
|
|
|
$ |
(7.22 |
) |
|
$ |
0.75 |
|
|
|
||
Net (loss) income per share - diluted (1) |
$ |
(8.60 |
) |
|
$ |
0.76 |
|
|
|
|
$ |
(7.22 |
) |
|
$ |
0.75 |
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Average number of shares outstanding - basic |
|
255 |
|
|
|
254 |
|
|
|
|
|
255 |
|
|
|
239 |
|
|
|
||
Average number of shares outstanding - diluted |
|
255 |
|
|
|
255 |
|
|
|
|
|
255 |
|
|
|
239 |
|
|
|
||
(1) |
For 2022 and 2021, net (loss) income per share reflects adjustments related to the redemption value of certain redeemable noncontrolling interests. |
NMF |
Not meaningful |
Condensed Consolidated Balance Sheets
(Amounts in millions)
(Unaudited)
|
|
|
|
||||
|
|
2022 |
|
|
2021 |
||
Cash, cash equivalents, and restricted cash |
$ |
548 |
|
|
$ |
715 |
|
Receivables, net |
|
2,031 |
|
|
|
1,906 |
|
Inventories |
|
3,122 |
|
|
|
2,516 |
|
Other current assets |
|
793 |
|
|
|
1,850 |
|
Total current assets |
|
6,494 |
|
|
|
6,987 |
|
|
|
|
|
||||
Property, plant and equipment, net |
|
4,055 |
|
|
|
4,368 |
|
|
|
22,691 |
|
|
|
26,920 |
|
Other assets |
|
1,297 |
|
|
|
1,383 |
|
Total assets |
$ |
34,537 |
|
|
$ |
39,658 |
|
|
|
|
|
||||
Short-term borrowings |
$ |
512 |
|
|
$ |
632 |
|
Other current liabilities |
|
3,114 |
|
|
|
3,001 |
|
Total current liabilities |
|
3,626 |
|
|
|
3,633 |
|
|
|
|
|
||||
Long-term debt |
|
10,260 |
|
|
|
10,768 |
|
Non-current liabilities |
|
3,662 |
|
|
|
4,035 |
|
|
|
|
|
||||
Redeemable noncontrolling interests |
|
68 |
|
|
|
105 |
|
|
|
|
|
||||
Shareholders' equity |
|
16,921 |
|
|
|
21,117 |
|
Total liabilities and shareholders' equity |
$ |
34,537 |
|
|
$ |
39,658 |
|
Consolidated Statements of Cash Flows
(Amounts in millions)
(Unaudited)
|
Nine Months Ended |
||||||
|
|
2022 |
|
|
|
2021 |
|
Cash flows from operating activities: |
|
|
|
||||
Net (loss) income |
$ |
(1,840 |
) |
|
$ |
187 |
|
Adjustments to reconcile to net cash provided by operating activities |
|
|
|
||||
Depreciation and amortization |
|
897 |
|
|
|
861 |
|
Deferred income taxes |
|
(222 |
) |
|
|
(148 |
) |
Gains on sales of fixed assets |
|
(2 |
) |
|
|
(1 |
) |
Gain on business divestiture |
|
(14 |
) |
|
|
— |
|
Stock-based compensation |
|
37 |
|
|
|
44 |
|
Pension contributions |
|
(25 |
) |
|
|
(21 |
) |
Amortization of inventory step-up |
|
— |
|
|
|
363 |
|
Impairment of goodwill |
|
2,250 |
|
|
|
— |
|
Impairment of long-lived assets |
|
120 |
|
|
|
— |
|
Changes in assets and liabilities, net of acquisitions: |
|
|
|
||||
Trade receivables |
|
(309 |
) |
|
|
(214 |
) |
Inventories |
|
(808 |
) |
|
|
(230 |
) |
Accounts payable |
|
111 |
|
|
|
256 |
|
Accruals for incentive compensation |
|
(56 |
) |
|
|
43 |
|
Other current payables and accrued expenses |
|
202 |
|
|
|
99 |
|
Other assets/liabilities, net |
|
(152 |
) |
|
|
(113 |
) |
Net cash provided by operating activities |
|
189 |
|
|
|
1,126 |
|
Cash flows from investing activities: |
|
|
|
||||
Cash paid for acquisitions, net of cash received |
|
(110 |
) |
|
|
— |
|
Additions to property, plant and equipment |
|
(344 |
) |
|
|
(242 |
) |
Additions to intangible assets |
|
(2 |
) |
|
|
(4 |
) |
Proceeds from disposal of assets |
|
1 |
|
|
|
13 |
|
Cash provided by the Merger with N&B |
|
11 |
|
|
|
193 |
|
Proceeds from unwinding of derivative instruments |
|
173 |
|
|
|
— |
|
Net proceeds received from business divestiture |
|
1,158 |
|
|
|
115 |
|
Net cash provided by investing activities |
|
887 |
|
|
|
75 |
|
Cash flows from financing activities: |
|
|
|
||||
Cash dividends paid to shareholders |
|
(604 |
) |
|
|
(466 |
) |
Increase (decrease) in revolving credit facility and short-term borrowings |
|
2 |
|
|
|
(105 |
) |
Proceeds from issuance of commercial paper (maturities after three months) |
|
160 |
|
|
|
— |
|
Repayments of commercial paper (maturities after three months) |
|
(235 |
) |
|
|
— |
|
Net (repayments) borrowings of commercial paper (maturities less than three months) |
|
(52 |
) |
|
|
200 |
|
Repayments of long-term debt |
|
(300 |
) |
|
|
(628 |
) |
Contingent consideration paid |
|
— |
|
|
|
(14 |
) |
Purchases of redeemable noncontrolling interest |
|
(39 |
) |
|
|
— |
|
Purchases of noncontrolling interest |
|
(6 |
) |
|
|
— |
|
Proceeds from issuance of long-term debt |
|
— |
|
|
|
3 |
|
Proceeds from issuance of stock in connection with stock options |
|
7 |
|
|
|
8 |
|
Employee withholding taxes paid |
|
(20 |
) |
|
|
(20 |
) |
Net cash used in financing activities |
|
(1,087 |
) |
|
|
(1,022 |
) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
(150 |
) |
|
|
(44 |
) |
Net change in cash, cash equivalents and restricted cash |
|
(161 |
) |
|
|
135 |
|
Cash, cash equivalents and restricted cash at beginning of year |
|
716 |
|
|
|
660 |
|
Cash, cash equivalents and restricted cash at end of period |
$ |
555 |
|
|
$ |
795 |
|
The following table reconciles cash, cash equivalents and restricted cash between the Company's statement of cash flows for the periods ended
AMOUNTS IN MILLIONS |
|
|
|
|
|
|
|
||||||||
Current assets |
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents |
$ |
538 |
|
$ |
711 |
|
$ |
672 |
|
$ |
650 |
||||
Restricted cash |
|
10 |
|
|
|
4 |
|
|
|
122 |
|
|
|
7 |
|
Noncurrent assets |
|
|
|
|
|
|
|
||||||||
Restricted cash included in Other assets |
|
7 |
|
|
|
1 |
|
|
|
1 |
|
|
|
3 |
|
Cash, cash equivalents and restricted cash |
$ |
555 |
|
|
$ |
716 |
|
|
$ |
795 |
|
|
$ |
660 |
|
Reportable Segment Performance
(Amounts in millions)
(Unaudited)
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
|
|
|
|
|
|
||||||||
Nourish |
$ |
1,703 |
|
|
$ |
1,662 |
|
|
$ |
5,252 |
|
|
$ |
4,638 |
|
Health & Biosciences |
|
512 |
|
|
|
618 |
|
|
|
1,838 |
|
|
|
1,683 |
|
Scent |
|
591 |
|
|
|
580 |
|
|
|
1,756 |
|
|
|
1,699 |
|
Pharma Solutions |
|
257 |
|
|
|
211 |
|
|
|
750 |
|
|
|
605 |
|
Consolidated |
$ |
3,063 |
|
|
$ |
3,071 |
|
|
$ |
9,596 |
|
|
$ |
8,625 |
|
Segment Adjusted Operating EBITDA |
|
|
|
|
|
|
|
||||||||
Nourish |
$ |
287 |
|
|
$ |
327 |
|
|
$ |
981 |
|
|
$ |
921 |
|
Health & Biosciences |
|
137 |
|
|
|
151 |
|
|
|
513 |
|
|
|
469 |
|
Scent |
|
119 |
|
|
|
130 |
|
|
|
328 |
|
|
|
375 |
|
Pharma Solutions |
|
69 |
|
|
|
40 |
|
|
|
192 |
|
|
|
131 |
|
Total |
|
612 |
|
|
|
648 |
|
|
|
2,014 |
|
|
|
1,896 |
|
Depreciation & Amortization |
|
(293 |
) |
|
|
(297 |
) |
|
|
(897 |
) |
|
|
(861 |
) |
Interest Expense |
|
(83 |
) |
|
|
(74 |
) |
|
|
(232 |
) |
|
|
(216 |
) |
Other Income, net |
|
33 |
|
|
|
26 |
|
|
|
43 |
|
|
|
44 |
|
Acquisition Related Costs |
|
(1 |
) |
|
|
— |
|
|
|
(2 |
) |
|
|
— |
|
Restructuring and Other Charges |
|
4 |
|
|
|
(6 |
) |
|
|
(5 |
) |
|
|
(34 |
) |
Gains on sales of fixed assets |
|
— |
|
|
|
1 |
|
|
|
2 |
|
|
|
1 |
|
Impairment of |
|
(2,250 |
) |
|
|
— |
|
|
|
(2,250 |
) |
|
|
— |
|
Impairment of Long-Lived Assets |
|
— |
|
|
|
— |
|
|
|
(120 |
) |
|
|
— |
|
Shareholder Activism Related Costs |
|
— |
|
|
|
— |
|
|
|
(3 |
) |
|
|
(7 |
) |
Business Divestiture Costs |
|
(31 |
) |
|
|
(16 |
) |
|
|
(91 |
) |
|
|
(21 |
) |
Employee Separation Costs |
|
— |
|
|
|
(22 |
) |
|
|
(4 |
) |
|
|
(28 |
) |
Global Shared Services Implementation Costs |
|
(1 |
) |
|
|
— |
|
|
|
(1 |
) |
|
|
— |
|
Frutarom Acquisition Related Costs |
|
— |
|
|
|
— |
|
|
|
(1 |
) |
|
|
— |
|
N&B Inventory Step-Up Costs |
|
— |
|
|
|
14 |
|
|
|
— |
|
|
|
(363 |
) |
N&B Transaction Related Costs |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(91 |
) |
Integration Related Costs |
|
(25 |
) |
|
|
(24 |
) |
|
|
(73 |
) |
|
|
(80 |
) |
(Loss) Income Before Taxes |
$ |
(2,035 |
) |
|
$ |
250 |
|
|
$ |
(1,620 |
) |
|
$ |
240 |
|
Segment Adjusted Operating EBITDA Margin |
|
|
|
|
|
|
|
||||||||
Nourish |
|
16.9 |
% |
|
|
19.7 |
% |
|
|
18.7 |
% |
|
|
19.9 |
% |
Health & Biosciences |
|
26.8 |
% |
|
|
24.4 |
% |
|
|
27.9 |
% |
|
|
27.9 |
% |
Scent |
|
20.1 |
% |
|
|
22.4 |
% |
|
|
18.7 |
% |
|
|
22.1 |
% |
Pharma Solutions |
|
26.8 |
% |
|
|
19.0 |
% |
|
|
25.6 |
% |
|
|
21.7 |
% |
Consolidated |
|
20.0 |
% |
|
|
21.1 |
% |
|
|
21.0 |
% |
|
|
22.0 |
% |
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 |
|||||||
|
Third Quarter |
||||||
(DOLLARS IN MILLIONS) |
|
2022 |
|
|
2021 |
|
|
Reported (GAAP) |
$ |
1,001 |
|
|
$ |
1,090 |
|
Employee Separation Costs (d) |
|
— |
|
|
|
1 |
|
N&B Inventory Step-Up Costs |
|
— |
|
|
|
(14 |
) |
Integration Related Costs (g) |
|
— |
|
|
|
3 |
|
Adjusted (Non-GAAP) |
$ |
1,001 |
|
|
$ |
1,080 |
|
Reconciliation of Selling and Administrative Expenses |
|||||||
|
Third Quarter |
||||||
(DOLLARS IN MILLIONS) |
|
2022 |
|
|
|
2021 |
|
Reported (GAAP) |
$ |
413 |
|
|
$ |
436 |
|
Acquisition Related Costs (a) |
|
(1 |
) |
|
|
— |
|
Business Divestiture Costs (c) |
|
(31 |
) |
|
|
(16 |
) |
Employee Separation Costs (d) |
|
— |
|
|
|
(20 |
) |
Global Shared Services Implementation Costs (e) |
|
(1 |
) |
|
|
— |
|
Integration Related Costs (g) |
|
(25 |
) |
|
|
(21 |
) |
Adjusted (Non-GAAP) |
$ |
355 |
|
|
$ |
379 |
|
GAAP to Non-GAAP Reconciliation
(Unaudited)
The following information and schedules provide reconciliation information between reported GAAP amounts and non-GAAP certain adjusted amounts. This information and schedules are not intended as, and should not be viewed as, a substitute for reported GAAP amounts or financial statements of the Company prepared and presented in accordance with GAAP.
Reconciliation of Net (Loss) Income and EPS |
|||||||||||||||||||||||||||||||
|
Third Quarter |
||||||||||||||||||||||||||||||
|
2022 |
|
2021 |
||||||||||||||||||||||||||||
(DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS) |
(Loss) Income before taxes |
|
Provision for income taxes (i) |
|
Net (Loss) Income Attributable to IFF (j) |
|
Diluted EPS (k) |
|
Income before taxes |
|
Provision for income taxes (i) |
|
Net Income Attributable to IFF (j) |
|
Diluted EPS (k) |
||||||||||||||||
Reported (GAAP) |
$ |
(2,035 |
) |
|
$ |
160 |
|
|
$ |
(2,197 |
) |
|
$ |
(8.60 |
) |
|
$ |
250 |
|
|
$ |
53 |
|
|
$ |
194 |
|
|
$ |
0.76 |
|
Acquisition Related Costs (a) |
|
1 |
|
|
|
1 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Restructuring and Other Charges |
|
(4 |
) |
|
|
(1 |
) |
|
|
(3 |
) |
|
|
(0.01 |
) |
|
|
6 |
|
|
|
1 |
|
|
|
5 |
|
|
|
0.02 |
|
Gains on Sale of Assets |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1 |
) |
|
|
— |
|
|
|
(1 |
) |
|
|
— |
|
Impairment of |
|
2,250 |
|
|
|
— |
|
|
|
2,250 |
|
|
|
8.81 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Business Divestiture Costs (c) |
|
31 |
|
|
|
(12 |
) |
|
|
43 |
|
|
|
0.16 |
|
|
|
16 |
|
|
|
4 |
|
|
|
12 |
|
|
|
0.05 |
|
Gains on Business Disposal |
|
(14 |
) |
|
|
(110 |
) |
|
|
96 |
|
|
|
0.38 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Employee Separation Costs (d) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
22 |
|
|
|
1 |
|
|
|
21 |
|
|
|
0.08 |
|
Global Shared Services Implementation Costs (e) |
|
1 |
|
|
|
— |
|
|
|
1 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Pension Income Adjustment (f) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(17 |
) |
|
|
(4 |
) |
|
|
(13 |
) |
|
|
(0.05 |
) |
N&B Inventory Step-Up Costs |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(14 |
) |
|
|
(3 |
) |
|
|
(11 |
) |
|
|
(0.04 |
) |
Integration Related Costs (g) |
|
25 |
|
|
|
6 |
|
|
|
19 |
|
|
|
0.07 |
|
|
|
24 |
|
|
|
5 |
|
|
|
19 |
|
|
|
0.07 |
|
Redemption value adjustment to EPS (h) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.01 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Adjusted (Non-GAAP) |
$ |
255 |
|
|
$ |
44 |
|
|
$ |
209 |
|
|
$ |
0.82 |
|
|
$ |
286 |
|
|
$ |
57 |
|
|
$ |
226 |
|
|
$ |
0.88 |
|
Reconciliation of Adjusted (Non-GAAP) EPS ex. Amortization |
|||||||
|
Third Quarter |
||||||
(DOLLARS AND SHARE AMOUNTS IN MILLIONS) |
|
2022 |
|
|
2021 |
||
Numerator |
|
|
|
||||
Adjusted (Non-GAAP) Net Income |
$ |
209 |
|
|
$ |
226 |
|
Amortization of Acquisition related Intangible Assets |
|
182 |
|
|
|
195 |
|
Tax impact on Amortization of Acquisition related Intangible Assets (i) |
|
44 |
|
|
|
44 |
|
Amortization of Acquisition related Intangible Assets, net of tax (l) |
|
138 |
|
|
|
151 |
|
Adjusted (Non-GAAP) Net Income ex. Amortization |
$ |
347 |
|
|
$ |
377 |
|
|
|
|
|
||||
Denominator |
|
|
|
||||
Weighted average shares assuming dilution (diluted) |
|
255 |
|
|
|
255 |
|
Adjusted (Non-GAAP) EPS ex. Amortization |
$ |
1.36 |
|
|
$ |
1.47 |
|
(a) |
Represents costs related to the acquisition of Health Wright Products, primarily consulting and legal fees. |
(b) |
Represents costs related to the impairment of goodwill in the Health & Biosciences reporting unit. |
(c) |
Represents costs related to the Company's planned sales of businesses, primarily legal and professional fees. |
(d) |
Represents costs related to severance, including accelerated stock compensation expense, for certain employees and executives who have been separated or will separate from the Company. |
(e) |
Represents costs related to the Company's efforts of restructuring the Global Shared Services Centers, primarily consulting fees. |
(f) |
Represents catch-up of net pension income from prior periods that had been excluded from their respective periods. |
(g) |
Represents costs related to integration activities since 2018, primarily for |
(h) |
Represents the adjustment to EPS related to the excess of the redemption value of certain redeemable noncontrolling interests over their existing carrying value. |
(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 |
(j) |
For 2022, net loss is increased by income attributable to noncontrolling interest of |
(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. |
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 |
|||||||
|
Third Quarter Year-to-Date |
||||||
(DOLLARS IN MILLIONS) |
|
2022 |
|
|
2021 |
||
Reported (GAAP) |
$ |
3,282 |
|
|
$ |
2,754 |
|
Employee Separation Costs (f) |
|
— |
|
|
|
1 |
|
N&B Inventory Step-Up Costs |
|
— |
|
|
|
363 |
|
Integration Related Costs (k) |
|
2 |
|
|
|
3 |
|
Adjusted (Non-GAAP) |
$ |
3,284 |
|
|
$ |
3,121 |
|
Reconciliation of Selling and Administrative Expenses |
|||||||
|
Third Quarter Year-to-Date |
||||||
(DOLLARS IN MILLIONS) |
|
2022 |
|
|
|
2021 |
|
Reported (GAAP) |
$ |
1,328 |
|
|
$ |
1,299 |
|
Acquisition Related Costs (a) |
|
(2 |
) |
|
|
— |
|
Restructuring and Other Charges |
|
— |
|
|
|
(1 |
) |
Shareholder Activism Related Costs (d) |
|
(3 |
) |
|
|
(7 |
) |
Business Divestiture Costs (e) |
|
(91 |
) |
|
|
(21 |
) |
Employee Separation Costs (f) |
|
(4 |
) |
|
|
(26 |
) |
Global Shared Services Implementation Costs (g) |
|
(1 |
) |
|
|
— |
|
Frutarom Acquisition Related Costs (i) |
|
(1 |
) |
|
|
— |
|
N&B Transaction Related Costs (j) |
|
— |
|
|
|
(91 |
) |
Integration Related Costs (k) |
|
(71 |
) |
|
|
(76 |
) |
Adjusted (Non-GAAP) |
$ |
1,155 |
|
|
$ |
1,077 |
|
GAAP to Non-GAAP Reconciliation
(Unaudited)
The following information and schedules provide reconciliation information between reported GAAP amounts and non-GAAP certain adjusted amounts. This information and schedules are not intended as, and should not be viewed as, a substitute for reported GAAP amounts or financial statements of the Company prepared and presented in accordance with GAAP.
Reconciliation of Net (Loss) Income and EPS |
|||||||||||||||||||||||||||||||
|
Third Quarter Year-to-Date |
||||||||||||||||||||||||||||||
|
2022 |
|
2021 |
||||||||||||||||||||||||||||
(DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS) |
(Loss) Income before taxes |
|
Provision for income taxes (m) |
|
Net (Loss) Income Attributable to IFF (n) |
|
Diluted EPS (o) |
|
Income before taxes |
|
Provision for income taxes (m) |
|
Net Income Attributable to IFF (n) |
|
Diluted EPS (o) |
||||||||||||||||
Reported (GAAP) |
$ |
(1,620 |
) |
|
$ |
220 |
|
|
$ |
(1,846 |
) |
|
$ |
(7.22 |
) |
|
$ |
240 |
|
|
$ |
53 |
|
|
$ |
180 |
|
|
$ |
0.75 |
|
Acquisition Related Costs (a) |
|
2 |
|
|
|
1 |
|
|
|
1 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Restructuring and Other Charges |
|
5 |
|
|
|
1 |
|
|
|
4 |
|
|
|
0.02 |
|
|
|
34 |
|
|
|
7 |
|
|
|
27 |
|
|
|
0.11 |
|
Gains on Sale of Assets |
|
(2 |
) |
|
|
(1 |
) |
|
|
(1 |
) |
|
|
(0.01 |
) |
|
|
(1 |
) |
|
|
— |
|
|
|
(1 |
) |
|
|
— |
|
Impairment of |
|
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) |
|
91 |
|
|
|
3 |
|
|
|
88 |
|
|
|
0.34 |
|
|
|
21 |
|
|
|
5 |
|
|
|
16 |
|
|
|
0.07 |
|
Gains on Business Disposal |
|
(14 |
) |
|
|
(110 |
) |
|
|
96 |
|
|
|
0.38 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Employee Separation Costs (f) |
|
4 |
|
|
|
1 |
|
|
|
3 |
|
|
|
0.01 |
|
|
|
28 |
|
|
|
2 |
|
|
|
26 |
|
|
|
0.11 |
|
Global Shared Services Implementation Costs (g) |
|
1 |
|
|
|
— |
|
|
|
1 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Pension Income Adjustment (h) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(17 |
) |
|
|
(4 |
) |
|
|
(13 |
) |
|
|
(0.05 |
) |
Frutarom Acquisition Related Costs (i) |
|
1 |
|
|
|
— |
|
|
|
1 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
N&B Inventory Step-Up Costs |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
363 |
|
|
|
79 |
|
|
|
284 |
|
|
|
1.19 |
|
N&B Transaction Related Costs (j) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
91 |
|
|
|
19 |
|
|
|
72 |
|
|
|
0.30 |
|
Integration Related Costs (k) |
|
73 |
|
|
|
18 |
|
|
|
55 |
|
|
|
0.21 |
|
|
|
80 |
|
|
|
18 |
|
|
|
62 |
|
|
|
0.26 |
|
Redemption value adjustment to EPS (l) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.01 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.01 |
|
Adjusted (Non-GAAP) |
$ |
914 |
|
|
$ |
158 |
|
|
$ |
750 |
|
|
$ |
2.94 |
|
|
$ |
846 |
|
|
$ |
181 |
|
|
$ |
658 |
|
|
$ |
2.75 |
|
Reconciliation of Adjusted (Non-GAAP) EPS ex. Amortization |
|||||||
|
Third Quarter Year-to-Date |
||||||
(DOLLARS AND SHARE AMOUNTS IN MILLIONS) |
|
2022 |
|
|
2021 |
||
Numerator |
|
|
|
||||
Adjusted (Non-GAAP) Net Income |
$ |
750 |
|
|
$ |
658 |
|
Amortization of Acquisition related Intangible Assets |
|
552 |
|
|
|
547 |
|
Tax impact on Amortization of Acquisition related Intangible Assets (m) |
|
130 |
|
|
|
113 |
|
Amortization of Acquisition related Intangible Assets, net of tax (p) |
|
422 |
|
|
|
434 |
|
Adjusted (Non-GAAP) Net Income ex. Amortization |
$ |
1,172 |
|
|
$ |
1,092 |
|
|
|
|
|
||||
Denominator |
|
|
|
||||
Weighted average shares assuming dilution (diluted) |
|
255 |
|
|
|
239 |
|
Adjusted (Non-GAAP) EPS ex. Amortization |
$ |
4.59 |
|
|
$ |
4.56 |
|
(a) |
Represents costs related to the acquisition of Health Wright Products, primarily consulting and legal fees. |
(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 |
(d) |
Represents shareholder activist related costs, primarily professional fees. |
(e) |
Represents costs related to the Company's 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 efforts of restructuring the Global Shared Services Centers, primarily consulting fees. |
(h) |
Represents catch-up of net pension income from prior periods that had been excluded from their respective periods. |
(i) |
Represents transaction-related costs and expenses related to the acquisition of |
(j) |
Represents transaction costs and expenses related to the transaction with N&B, primarily legal and professional fees. |
(k) |
Represents costs related to integration activities since 2018, primarily for |
(l) |
Represents the adjustment to EPS related to the excess of the redemption value of certain redeemable noncontrolling interests over their existing carrying value. |
(m) |
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 |
(n) |
For 2022, net loss is increased by income attributable to noncontrolling interest of |
(o) |
The sum of these items does not foot due to rounding. |
(p) |
Represents all amortization of intangible assets acquired in connection with acquisitions, net of tax. |
Debt Covenants
(Amounts in millions)
(Unaudited)
The following information and schedules provide reconciliation information between reported GAAP amounts and non-GAAP certain adjusted amounts. This information and schedules are not intended as, and should not be viewed as, a substitute for reported GAAP amounts or financial statements of the Company prepared and presented in accordance with GAAP.
Reconciliation of Credit Adjusted EBITDA to Net Loss |
|||
(DOLLARS IN MILLIONS) |
Twelve Months Ended
|
||
Net loss |
$ |
(1,756 |
) |
Interest expense |
|
305 |
|
Income taxes |
|
242 |
|
Depreciation and amortization |
|
1,192 |
|
Specified items(1) |
|
2,613 |
|
Non-cash items(2) |
|
18 |
|
Credit Adjusted EBITDA |
$ |
2,614 |
|
| _______________________ | |
(1) |
Specified items for the 12 months ended |
(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 disposal of assets, gains on business disposal and stock-based compensation. |
Net Debt to Total Debt |
|||
(DOLLARS IN MILLIONS) |
|
||
Total debt(1) |
$ |
10,812 |
|
Adjustments: |
|
||
Cash and cash equivalents |
|
538 |
|
Net debt |
$ |
10,274 |
|
| _______________________ | |
(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. |
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 |
|
Nine Months Ended |
||||||||||||
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
|
|
|
|
|
|
||||||||
Nourish(1) |
$ |
1,703 |
|
|
$ |
1,645 |
|
|
$ |
5,252 |
|
|
$ |
4,832 |
|
Health & Biosciences(2) |
|
495 |
|
|
|
510 |
|
|
|
1,795 |
|
|
|
1,764 |
|
Scent |
|
591 |
|
|
|
580 |
|
|
|
1,756 |
|
|
|
1,699 |
|
Pharma Solutions |
|
257 |
|
|
|
211 |
|
|
|
750 |
|
|
|
676 |
|
Consolidated |
$ |
3,046 |
|
|
$ |
2,946 |
|
|
$ |
9,553 |
|
|
$ |
8,971 |
|
Segment Adjusted Operating EBITDA |
|
|
|
|
|
|
|
||||||||
Nourish(1) |
$ |
287 |
|
|
$ |
325 |
|
|
$ |
981 |
|
|
$ |
950 |
|
Health & Biosciences(2) |
|
139 |
|
|
|
149 |
|
|
|
513 |
|
|
|
520 |
|
Scent |
|
119 |
|
|
|
130 |
|
|
|
328 |
|
|
|
375 |
|
Pharma Solutions |
|
69 |
|
|
|
40 |
|
|
|
192 |
|
|
|
148 |
|
Total |
|
614 |
|
|
|
644 |
|
|
|
2,014 |
|
|
|
1,993 |
|
Depreciation & Amortization |
|
(293 |
) |
|
|
(297 |
) |
|
|
(897 |
) |
|
|
(861 |
) |
Interest Expense |
|
(83 |
) |
|
|
(74 |
) |
|
|
(232 |
) |
|
|
(216 |
) |
Other Income, net |
|
33 |
|
|
|
26 |
|
|
|
43 |
|
|
|
44 |
|
Acquisition Related Costs |
|
(1 |
) |
|
|
— |
|
|
|
(2 |
) |
|
|
— |
|
Restructuring and Other Charges |
|
4 |
|
|
|
(6 |
) |
|
|
(5 |
) |
|
|
(34 |
) |
Gains on sales of fixed assets |
|
— |
|
|
|
1 |
|
|
|
2 |
|
|
|
1 |
|
Impairment of |
|
(2,250 |
) |
|
|
— |
|
|
|
(2,250 |
) |
|
|
— |
|
Impairment of Long-Lived Assets |
|
— |
|
|
|
— |
|
|
|
(120 |
) |
|
|
— |
|
Shareholder Activism Related Costs |
|
— |
|
|
|
— |
|
|
|
(3 |
) |
|
|
(7 |
) |
Business Divestiture Costs |
|
(31 |
) |
|
|
(16 |
) |
|
|
(91 |
) |
|
|
(21 |
) |
Employee Separation Costs |
|
— |
|
|
|
(22 |
) |
|
|
(4 |
) |
|
|
(28 |
) |
Global Shared Services Implementation Costs |
|
(1 |
) |
|
|
— |
|
|
|
(1 |
) |
|
|
— |
|
Frutarom Acquisition Related Costs |
|
— |
|
|
|
— |
|
|
|
(1 |
) |
|
|
— |
|
N&B Inventory Step-Up Costs |
|
— |
|
|
|
14 |
|
|
|
— |
|
|
|
(363 |
) |
N&B Transaction Related Costs |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(91 |
) |
Integration Related Costs |
|
(25 |
) |
|
|
(24 |
) |
|
|
(73 |
) |
|
|
(80 |
) |
Impact of Business Divestitures(3) |
|
— |
|
|
|
4 |
|
|
|
— |
|
|
|
10 |
|
Impact of Business Acquisitions(4) |
|
(2 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Impact of Merger with N&B(5) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(107 |
) |
(Loss) Income Before Taxes |
$ |
(2,035 |
) |
|
$ |
250 |
|
|
$ |
(1,620 |
) |
|
$ |
240 |
|
Segment Adjusted Operating EBITDA Margin |
|
|
|
|
|
|
|
||||||||
Nourish |
|
16.9 |
% |
|
|
19.8 |
% |
|
|
18.7 |
% |
|
|
19.7 |
% |
Health & Biosciences |
|
28.1 |
% |
|
|
29.2 |
% |
|
|
28.6 |
% |
|
|
29.5 |
% |
Scent |
|
20.1 |
% |
|
|
22.4 |
% |
|
|
18.7 |
% |
|
|
22.1 |
% |
Pharma Solutions |
|
26.8 |
% |
|
|
19.0 |
% |
|
|
25.6 |
% |
|
|
21.9 |
% |
Consolidated |
|
20.2 |
% |
|
|
21.9 |
% |
|
|
21.1 |
% |
|
|
22.2 |
% |
| ______________________ | ||||||||||
(1) |
Nourish sales and segment adjusted operating EBITDA information for the three and nine months ended |
|||||||||
(2) |
Health & Biosciences sales and segment adjusted operating EBITDA information for the three and nine months ended |
|||||||||
(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 |
|||||||||
(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 nine months ended |
|||||||||
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) |
|
||||||
|
Pro |
|
Pro Forma Adjusted Operating EBITDA |
||||
Nourish |
$ |
247 |
|
$ |
37 |
||
Health & Biosciences |
|
189 |
|
|
|
53 |
|
Scent |
|
— |
|
|
|
— |
|
Pharma Solutions |
|
71 |
|
|
|
17 |
|
GAAP to Non-GAAP Reconciliation
Comparable Foreign Exchange Impact
(Unaudited)
Q3 Nourish |
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Comparable |
|
|
|
(12)% |
|
(2.9)% |
Currency Impact |
|
|
|
|
|
|
% Change - Currency Neutral |
|
|
|
(4)% |
|
(2.5)% |
|
|
|
|
|
|
|
|
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Comparable |
|
(3)% |
|
(7)% |
|
(1.1)% |
Currency Impact |
|
|
|
|
|
|
% Change - Currency Neutral |
|
|
|
(1)% |
|
(1.1)% |
|
|
|
|
|
|
|
Q3 Scent |
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Comparable |
|
|
|
(8)% |
|
(2.3)% |
Currency Impact |
|
|
|
|
|
|
% Change - Currency Neutral |
|
|
|
|
|
(1.1)% |
|
|
|
|
|
|
|
Q3 Pharma Solutions |
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Comparable |
|
|
|
|
|
|
Currency Impact |
|
|
|
|
|
(0.7)% |
% Change - Currency Neutral |
|
|
|
|
|
|
|
|
|
|
|
|
|
Q3 Consolidated |
|
Sales |
|
Adjusted Operating EBITDA |
|
Adjusted Operating EBITDA Margin |
% Change - Comparable |
|
|
|
(5)% |
|
(1.7)% |
Currency Impact |
|
|
|
|
|
|
% Change - Currency Neutral |
|
|
|
|
|
(1.3)% |
YTD Nourish |
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Comparable |
|
|
|
|
|
(1.0)% |
Currency Impact |
|
|
|
|
|
|
% Change - Currency Neutral |
|
|
|
|
|
(0.8)% |
|
|
|
|
|
|
|
|
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Comparable |
|
|
|
(1)% |
|
(0.9)% |
Currency Impact |
|
|
|
|
|
(0.1)% |
% Change - Currency Neutral |
|
|
|
|
|
(1.0)% |
|
|
|
|
|
|
|
YTD Scent |
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Comparable |
|
|
|
(13)% |
|
(3.4)% |
Currency Impact |
|
|
|
|
|
|
% Change - Currency Neutral |
|
|
|
(5)% |
|
(2.7)% |
|
|
|
|
|
|
|
YTD Pharma Solutions |
|
Sales |
|
Segment Adjusted Operating EBITDA |
|
Segment Adjusted Operating EBITDA Margin |
% Change - Comparable |
|
|
|
|
|
|
Currency Impact |
|
|
|
|
|
(0.4)% |
% Change - Currency Neutral |
|
|
|
|
|
|
|
|
|
|
|
|
|
YTD Consolidated |
|
Sales |
|
Adjusted Operating EBITDA |
|
Adjusted Operating EBITDA Margin |
% Change - Comparable |
|
|
|
|
|
(1.1)% |
Currency Impact |
|
|
|
|
|
|
% Change - Currency Neutral |
|
|
|
|
|
(0.9)% |
View source version on businesswire.com: https://www.businesswire.com/news/home/20221107005814/en/
Chief Investor Relations & Communications Officer
212.708.7164
Michael.DeVeau@iff.com
Source: IFF
FAQ
What were IFF's Q3 2022 financial results?
What caused the goodwill impairment at IFF?
How does IFF's sales guidance for 2022 compare to previous estimates?
What are the expected growth rates for IFF in 2022?
What was IFF's adjusted EPS for Q3 2022?
