International Flavors & Fragrances Inc. (IFF) reported adjusted earnings of $1.13 per share in first-quarter 2024, beating the Zacks Consensus Estimate of 84 cents. The bottom line improved 30% from the year-ago quarter.Including one-time items, the company reported earnings of 23 cents against the prior-year quarter’s loss of 4 cents.International Flavors’ net sales were $2.9 billion in the March-end quarter, decreasing 4.2% year over year. The top line surpassed the Zacks Consensus Estimate of $2.81 billi ...

Financial Data and Key Metrics Changes - The company achieved a 5% year-over-year increase in sales on a comparable currency neutral basis, totaling approximately $2.9 billion in the first quarter of 2024 [137] - Adjusted operating EBITDA reached $578 million, representing a 20% increase year-over-year, with margins improving by approximately 310 basis points to nearly 20% [28][138] - The net debt to credit adjusted EBITDA ratio improved to 4.4 times, with gross debt reduced by almost $1 billion compared to the previous year [11] Business Line Data and Key Metrics Changes - The Scent segment reported a 16% growth in comparable currency neutral sales, driven by double-digit growth in consumer fragrance and fragrance ingredients [29] - The Health and Biosciences segment experienced a 6% increase in comparable currency neutral sales, with double-digit growth in cultures and food enzymes [138] - The Nourish segment showed mid-single digit growth, with overall volume growth in the business lines being mid-single digits for the first quarter [5][50] Market Data and Key Metrics Changes - Volume growth was observed in emerging markets, particularly in Asia and LATAM, while North America and EMEA showed softer performance [73] - The company expects a 3% to 4% adverse impact from foreign exchange rates on sales growth, which was previously expected to be neutral [12] Company Strategy and Development Direction - The company is focusing on a new operating model based on four pillars: customer focus, innovation, operational excellence, and engaged people [7] - A divestiture of the Pharma Solutions business is planned, with proceeds expected to strengthen the capital structure and support deleveraging goals [134][140] - The leadership team is committed to enhancing collaboration and driving profitable growth through innovation and customer engagement [136][142] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for the remainder of 2024, expecting results to trend towards the high end of previously announced guidance ranges [26][31] - The company anticipates continued improvements in volumes and strong productivity, despite a challenging consumer environment [64][66] - Management noted that innovation is becoming increasingly important for customers, which aligns with the company's strategy to enhance its innovation capabilities [118] Other Important Information - The company is implementing a refocused operating model that empowers business units while ensuring corporate functions support overall performance [131] - The leadership team is focused on developing internal talent and promoting from within to ensure smooth transitions in executive roles [99][76] Q&A Session All Questions and Answers Question: What are your expectations for volume cadence? - Management noted that while the first quarter showed strong performance, they expect some softening in volumes for the remainder of the year, particularly in the Scent and Nourish segments [74][87] Question: Can you discuss the dynamics behind the strong performance in the Scent segment? - Management indicated that the strong performance was driven by effective innovation and customer engagement, with expectations for continued strong performance under new leadership [79] Question: What is the outlook for free cash flow and adjusted EBITDA? - Management revised the free cash flow target to approximately $600 million for the year, reflecting improved earnings momentum and working capital performance [38] Question: How does the company plan to optimize its balance sheet post-divestiture? - The company plans to use proceeds from the Pharma Solutions divestiture to address debt maturities and optimize its capital structure [83][105] Question: What are the expectations for pricing dynamics throughout the year? - Management expects a small net positive pricing impact for the full year, with pricing actions primarily focused on the functional ingredients space [43]

iff CAUTIONARY STATEMENT First Quarter 2024 Earnings Conference Call 2 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 forwardlooking information may be identified by such terms as "expect", "anticipate", "believe", "intend", "outlook", "may", "estimate", "should", "predict" and similar terms o ...

International Flavors (IFF) reported $2.9 billion in revenue for the quarter ended March 2024, representing a year-over-year decline of 4.2%. EPS of $1.13 for the same period compares to $0.87 a year ago.The reported revenue compares to the Zacks Consensus Estimate of $2.81 billion, representing a surprise of +3.35%. The company delivered an EPS surprise of +34.52%, with the consensus EPS estimate being $0.84.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wa ...

International Flavors (IFF) came out with quarterly earnings of $1.13 per share, beating the Zacks Consensus Estimate of $0.84 per share. This compares to earnings of $0.87 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 34.52%. A quarter ago, it was expected that this ingredients producer for food, cosmetics and consumer products industries would post earnings of $0.75 per share when it actually produced earnings of $0.72, de ...

PART I - Financial Information [Financial Statements](index=3&type=section&id=ITEM%201.%20Financial%20Statements) This section presents the unaudited Consolidated Financial Statements for Q1 2024 and 2023, covering key financial statements and notes Consolidated Statements of Income (Loss) (Unaudited) | (AMOUNTS IN MILLIONS EXCEPT PER SHARE AMOUNTS) | 2024 | 2023 | | :--- | :--- | :--- | | **Net sales** | $ 2,899 | $ 3,027 | | **Gross profit** | $ 1,024 | $ 964 | | **Operating profit** | $ 199 | $ 131 | | **Income before taxes** | $ 115 | $ 14 | | **Net income (loss)** | $ 61 | $ (8) | | **Net income (loss) attributable to IFF shareholders** | $ 60 | $ (9) | | **Net income (loss) per share - diluted** | $ 0.23 | $ (0.04) | Consolidated Balance Sheets Highlights (Unaudited) | (DOLLARS IN MILLIONS) | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Total Current Assets** | $ 6,407 | $ 6,293 | | **Total Assets** | $ 30,642 | $ 30,978 | | **Total Current Liabilities** | $ 3,820 | $ 3,758 | | **Long-term debt** | $ 9,150 | $ 9,186 | | **Total Shareholders' Equity** | $ 14,326 | $ 14,642 | | **Total Liabilities and Shareholders' Equity** | $ 30,642 | $ 30,978 | Consolidated Statements of Cash Flows (Unaudited) | (DOLLARS IN MILLIONS) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $ 99 | $ 127 | | **Net cash used in investing activities** | $ (78) | $ (167) | | **Net cash provided by financing activities** | $ 40 | $ 78 | | **Net change in cash, cash equivalents and restricted cash** | $ 36 | $ 65 | [Note 1. Nature of Operations and Summary of Significant Accounting Policies](index=7&type=section&id=Note%201.%20Nature%20of%20Operations%20and%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines IFF's business, confirms U.S. GAAP, details a Q1 2023 interest expense correction, and covers cash and receivables - IFF is a leading creator and manufacturer of food, beverage, health & biosciences, scent and pharma solutions[16](index=16&type=chunk) - In Q1 2024, the company revised its Q1 2023 financials, adjusting Interest expense to **$100 million** (from **$111 million**) and Other expense, net to **$17 million** (from **$6 million**) due to adjustments related to cash pooling arrangements[19](index=19&type=chunk) - The company sold approximately **$406 million** of receivables under factoring agreements in the three months ended March 31, 2024, with associated costs of **$6 million**[23](index=23&type=chunk) [Note 3. Business Divestitures](index=10&type=section&id=Note%203.%20Business%20Divestitures) Details significant portfolio changes, including the agreement to sell Pharma Solutions and the completed Cosmetic Ingredients divestiture - On March 19, 2024, the company entered into an agreement to sell its Pharma Solutions business for a value of up to **$2.85 billion**, with the transaction expected to close in Q2 2025[36](index=36&type=chunk) - The divestiture of the Cosmetic Ingredients business was completed on April 2, 2024, yielding gross cash proceeds of approximately **$841 million**[37](index=37&type=chunk) [Note 4. Restructuring and Other Charges](index=10&type=section&id=Note%204.%20Restructuring%20and%20Other%20Charges) Reports total restructuring charges of $3 million for Q1 2024, a significant decrease from $52 million in Q1 2023 Restructuring and Other Charges by Quarter | (DOLLARS IN MILLIONS) | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | **Total Restructuring and other charges** | $ 3 | $ 52 | [Note 6. Segment Information](index=11&type=section&id=Note%206.%20Segment%20Information) Provides a breakdown of net sales and Segment Adjusted Operating EBITDA for the four segments, with Nourish leading sales Net Sales by Segment (Q1) | (DOLLARS IN MILLIONS) | 2024 | 2023 | | :--- | :--- | :--- | | Nourish | $ 1,496 | $ 1,653 | | Health & Biosciences | $ 531 | $ 513 | | Scent | $ 645 | $ 608 | | Pharma Solutions | $ 227 | $ 253 | | **Consolidated** | **$ 2,899** | **$ 3,027** | Segment Adjusted Operating EBITDA (Q1) | (DOLLARS IN MILLIONS) | 2024 | 2023 | | :--- | :--- | :--- | | Nourish | $ 216 | $ 208 | | Health & Biosciences | $ 159 | $ 131 | | Scent | $ 157 | $ 105 | | Pharma Solutions | $ 46 | $ 59 | | **Total** | **$ 578** | **$ 503** | [Note 13. Debt](index=17&type=section&id=Note%2013.%20Debt) Details the company's debt composition, totaling $10.3 billion, and recent repayments including a $270 million Term Loan and €500 million Euro Notes - Total debt was **$10.3 billion** as of March 31, 2024, compared to **$10.1 billion** at year-end 2023[69](index=69&type=chunk) - In Q1 2024, the company repaid a **$270 million** Term Loan and **€500 million** in Euro Notes at maturity[74](index=74&type=chunk) - In April 2024, the company used proceeds from the Cosmetic Ingredients business divestiture to make net repayments of **$586 million** on its commercial paper program and **$250 million** on its Revolving Credit Facility[76](index=76&type=chunk) [Note 18. Commitments and Contingencies](index=23&type=section&id=Note%2018.%20Commitments%20and%20Contingencies) Discloses various commitments and legal contingencies, including class action lawsuits and ongoing antitrust investigations - The company faces putative class action lawsuits in Canada and the U.S. alleging violations of competition laws (Sherman Act)[110](index=110&type=chunk) - The European Commission (EC), UK Competition and Markets Authority (CMA), and U.S. Department of Justice (DOJ) are investigating potential anticompetitive conduct in IFF's fragrance businesses. IFF is cooperating with these investigations[112](index=112&type=chunk) - During Q1 2024, IFF recognized a non-material provision related to a procedural aspect of the ongoing investigations[112](index=112&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=ITEM%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management analyzes Q1 2024 financial results, segment performance, liquidity, and capital resources, noting sales decrease and profit improvement - Q1 2024 sales decreased **4%** on a reported basis (**1%** currency neutral) to **$2.9 billion**, primarily driven by the impact of divestitures totaling approximately **$153 million**[128](index=128&type=chunk) - Gross profit increased **6%** to **$1.024 billion**, with gross margin improving to **35.3%** from **31.8%** in the prior year, driven by volume increases, productivity gains, and favorable pricing[129](index=129&type=chunk) - The company is in compliance with all debt covenants, with a net debt to credit adjusted EBITDA ratio of **4.42 to 1.0** as of March 31, 2024, below the required covenant level of **5.25x**[168](index=168&type=chunk) [Results of Operations](index=28&type=section&id=Results%20of%20Operations) This section compares Q1 2024 to 2023, showing a 4% net sales decrease, a 6% gross profit rise, and a swing to $61 million net income Q1 2024 vs Q1 2023 Performance | (DOLLARS IN MILLIONS) | 2024 | 2023 | Change | | :--- | :--- | :--- | :--- | | **Net sales** | $ 2,899 | $ 3,027 | (4) % | | **Gross profit** | $ 1,024 | $ 964 | 6 % | | **Operating profit** | $ 199 | $ 131 | 52 % | | **Net income (loss)** | $ 61 | $ (8) | NMF | - Selling and Administrative (S&A) expenses increased **8%** to **$490 million**, primarily due to higher legal fees and provisions for ongoing investigations of the fragrance businesses[139](index=139&type=chunk) - Interest expense decreased **17%** to **$83 million** due to lower outstanding debt[142](index=142&type=chunk) [Segment Performance](index=29&type=section&id=Segment%20Performance) Analyzes the four business segments, noting sales growth in Health & Biosciences and Scent, declines in Nourish and Pharma Solutions, and varied EBITDA margins Currency Neutral Sales % Change (Q1 2024 vs. Q1 2023) | Segment | % Change | | :--- | :--- | | Nourish | -6 % | | Health & Biosciences | 6 % | | Scent | 12 % | | Pharma Solutions | -11 % | | **Total** | **-1 %** | - Scent Segment Adjusted Operating EBITDA increased **50%** to **$157 million**, driven by favorable pricing, volume increases, and productivity gains[150](index=150&type=chunk) - Pharma Solutions Segment Adjusted Operating EBITDA decreased **22%** to **$46 million**, driven by volume decreases and unfavorable net pricing[152](index=152&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) Details the company's financial position and cash management, noting decreased operating cash flow, dividend payments, and capital spending plans - Cash flows from operating activities decreased to **$99 million** in Q1 2024 from **$127 million** in Q1 2023, primarily due to an increase in working capital[155](index=155&type=chunk) - Capital spending for 2024 is expected to be approximately **4.9%** of sales, up from **4.1%** in 2023[157](index=157&type=chunk) - The company's credit agreements provide financial covenant relief through December 31, 2025, with tiered leverage ratio limits and restrictions on share repurchases and dividends[165](index=165&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=37&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) Reports no material changes in market risk from the 2023 Form 10-K, except for cross-currency swap agreements with a $132 million liability - There are no material changes in market risk from the information provided in the 2023 Form 10-K, except for cross currency swap agreements[187](index=187&type=chunk) - As of March 31, 2024, cross currency swaps had an aggregate fair value liability of **$132 million**. A hypothetical **10%** change in the USD/EUR exchange rate would result in a fair value change of approximately **$146 million**[188](index=188&type=chunk) [Controls and Procedures](index=37&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2024, with no material changes to internal controls - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures are effective as of March 31, 2024[189](index=189&type=chunk) - There were no changes in internal control over financial reporting during the quarter ended March 31, 2024, that have materially affected, or are reasonably likely to materially affect, internal controls[191](index=191&type=chunk) PART II - Other Information [Legal Proceedings](index=38&type=section&id=ITEM%201.%20Legal%20Proceedings) This section refers to Note 18 of the Consolidated Financial Statements for updates on legal proceedings, including antitrust investigations and class action lawsuits - For updates on legal proceedings, the report refers to Note 18 of the Consolidated Financial Statements[194](index=194&type=chunk) [Risk Factors](index=38&type=section&id=ITEM%201A.%20Risk%20Factors) The company states no material changes to risk factors previously disclosed in its 2023 Annual Report on Form 10-K - There have been no material changes with respect to the risk factors disclosed in the company's 2023 Form 10-K[195](index=195&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=38&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported that there were no unregistered sales of equity securities during the reporting period - None[196](index=196&type=chunk) [Other Information](index=38&type=section&id=ITEM%205.%20Other%20Information) This section confirms no directors or executive officers adopted or terminated Rule 10b5-1 trading plans in Q1 2024 - During the quarter ended March 31, 2024, none of the company's directors or executive officers adopted or terminated any Rule 10b5-1 trading arrangement[197](index=197&type=chunk) [Exhibits](index=38&type=section&id=ITEM%206.%20Exhibits) Lists the exhibits filed with the Form 10-Q, including executive agreements and Sarbanes-Oxley certifications - The report lists several exhibits, including a Separation Agreement with Franklin K. Clyburn, Jr., a Letter Agreement with CEO J. Erik Fyrwald, and required Sarbanes-Oxley certifications[199](index=199&type=chunk)

FOR IMMEDIATE RELEASE Media Relations: Paulina Heinkel 332.877.5339 Media.request@iff.com Investor Relations: Michael Bender 212.708.7263 Investor.Relations@iff.com IFF Reports First Quarter 2024 Results NEW YORK - May 6, 2024 - IFF (NYSE: IFF) reported financial results for the first quarter ended March 31, 2024. First Quarter 2024 Consolidated Summary: | | Reported | | Adjusted | 1 | | | --- | --- | --- | --- | --- | --- | | | (GAAP) | | (Non-GAAP) | | | | Sales | Income Before Taxes | EPS | Operating EBI ...

International Flavors & Fragrances Inc. (IFF) is scheduled to report first-quarter 2024 results on May 6, after the closing bell.Q4 PerformanceIn the last reported quarter, IFF’s earnings and revenues declined on a year-over-year basis. The company missed the Zacks Consensus Estimate for the top and bottom lines.International Flavors has surpassed earnings estimates in one of the trailing four quarters and missed in the other three, the average negative surprise being 2.7%.Q1 EstimatesThe Zacks Consensus Es ...

Wall Street analysts forecast that International Flavors (IFF) will report quarterly earnings of $0.84 per share in its upcoming release, pointing to a year-over-year decline of 3.5%. It is anticipated that revenues will amount to $2.81 billion, exhibiting a decline of 7.3% compared to the year-ago quarter.The consensus EPS estimate for the quarter has undergone a downward revision of 1.1% in the past 30 days, bringing it to its present level. This represents how the covering analysts, as a whole, have reas ...

Wall Street expects a year-over-year decline in earnings on lower revenues when International Flavors (IFF) reports results for the quarter ended March 2024. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates.The earnings report, which is expected to be released on May 6, 2024, might help the stock move higher if these key numbers are better than e ...