Core Viewpoint - International Flavors & Fragrances Inc. (IFF) is expected to report a decline in sales and earnings for the first quarter of 2025, with a consensus estimate of $2.83 billion in sales, reflecting a 2.2% decrease year-over-year, and earnings per share estimated at $1.12, indicating a 0.9% dip from the previous year [1][2]. Financial Estimates - The consensus estimate for IFF's sales is $2.83 billion, down 2.2% from the prior year [1]. - The earnings estimate is $1.12 per share, which has increased by 2.7% over the past 60 days but shows a year-over-year decline of 0.9% [2]. - The earnings estimates for upcoming quarters are as follows: Q2 at $1.17, F1 at $4.20, and F2 at $4.54 [2]. Earnings Surprise History - IFF has beaten the Zacks Consensus Estimates in three of the last four quarters, with an average surprise of 17.9% [3][4]. Earnings ESP and Zacks Rank - IFF has an Earnings ESP of +1.05%, indicating a potential earnings beat [5]. - The company currently holds a Zacks Rank of 3, suggesting a hold position [6]. Performance Factors - IFF is experiencing volume growth across its business segments, which is expected to positively impact sales performance [7]. - The company is facing high raw material costs and additional expenses related to labor, shipping, and cleaning, which may negatively affect margins despite cost reduction efforts [8]. Segment Projections - The Nourish segment is projected to see a 3.6% decline in sales to $1.44 billion, with operating EBITDA expected to fall 2.1% to $211 million [9]. - The Scent segment's sales are estimated to decrease by 6% to $606 million, with operating EBITDA projected to decline 15.9% to $132 million [10]. - The Health & Biosciences segment is expected to report sales of $532 million, reflecting a slight increase of 0.2%, with operating EBITDA anticipated to rise 1.7% to $162 million [11]. Recent Developments - IFF completed the divestiture of its Pharma Solutions business to Roquette on May 1, 2025, which is expected to help the company achieve its target net debt to credit-adjusted EBITDA ratio of below 3.0X [12]. Stock Performance - Over the past year, IFF shares have decreased by 8%, contrasting with a 0.4% growth in the industry [13].

Core Insights - Analysts expect International Flavors (IFF) to report quarterly earnings of $1.12 per share, reflecting a year-over-year decline of 0.9% and revenues of $2.83 billion, down 2.2% from the previous year [1] Earnings Projections - Revisions to earnings projections are crucial for predicting investor behavior, with empirical studies showing a strong correlation between earnings estimate revisions and short-term stock performance [2] Key Metrics Estimates - Analysts project 'Net Sales- Nourish' to reach $1.45 billion, indicating a decline of 2.8% from the prior-year quarter [4] - The consensus estimate for 'Net Sales- Scent' is $609.74 million, reflecting a decrease of 5.5% year-over-year [4] - 'Net Sales- Pharma Solutions' is expected to be $233.97 million, showing a year-over-year increase of 3.1% [4] - 'Net Sales- Health & Biosciences' is forecasted at $532.05 million, indicating a slight increase of 0.2% from the previous year [5] Adjusted Operating EBITDA Estimates - 'Adjusted Operating EBITDA- Nourish' is projected to be $216.88 million, compared to $216 million in the same quarter last year [5] - 'Adjusted Operating EBITDA- Pharma Solutions' is expected to be $45.50 million, slightly down from $46 million year-over-year [6] - 'Adjusted Operating EBITDA- Scent' is estimated at $140.59 million, down from $157 million in the previous year [6] - 'Adjusted Operating EBITDA- Health & Biosciences' is projected to reach $159.94 million, compared to $159 million in the same quarter last year [7] Stock Performance - Over the past month, IFF shares have recorded a return of -0.2%, compared to a -0.7% change in the Zacks S&P 500 composite, indicating that IFF is likely to perform in line with the overall market [8]

Financial Data and Key Metrics Changes - The meeting confirmed the election of directors and the ratification of PricewaterhouseCoopers LLP as the independent registered public accounting firm for the fiscal year 2025 [17][18] - The compensation of named executive officers for 2024 was approved on an advisory basis, indicating a focus on aligning executive pay with performance [13][18] Business Line Data and Key Metrics Changes - No specific data on business line performance was provided during the meeting [0] Market Data and Key Metrics Changes - No specific market data or metrics were discussed during the meeting [0] Company Strategy and Development Direction and Industry Competition - The company continues to emphasize good corporate governance practices by submitting the selection of its independent accountant for shareholder ratification [12] - The board's recommendation for the election of directors and approval of executive compensation reflects a commitment to maintaining strong leadership and accountability [11][13] Management's Comments on Operating Environment and Future Outlook - Management did not provide specific comments on the operating environment or future outlook during the meeting [0] Other Important Information - The meeting was conducted virtually to enhance accessibility and communication with shareholders [2][3] - The chair expressed gratitude to shareholders for their participation and support, highlighting the importance of shareholder engagement [19] Q&A Session Summary Question: Does the compensation committee use the compensation actually paid total compensation figure in setting the CEO target total compensation award amount for the upcoming year? - The compensation committee considers the compensation actually paid as a key figure and benchmarks against a peer set of 16 companies, targeting the median to the seventy-fifth percentile for annual compensation [22][24] Question: Why does the total compensation amount differ from the compensation actually paid? - The difference arises because the CEO's compensation is largely variable, depending on performance levers in the compensation program, which can lead to variations in actual payouts each year [24]

Company Overview - International Flavors (IFF) is expected to report a year-over-year decline in earnings and revenues for the quarter ended March 2025, with earnings projected at $1.11 per share, down 1.8%, and revenues at $2.83 billion, down 2.3% [3][1]. Earnings Expectations - The stock price may increase if actual earnings exceed expectations in the upcoming report, scheduled for May 6 [2]. - The consensus EPS estimate has been revised 2.38% higher in the last 30 days, indicating a more optimistic outlook from analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP for International Flavors is +0.59%, suggesting a likelihood of beating the consensus EPS estimate [11][10]. - The company has a Zacks Rank of 3, which indicates a hold position, but the positive Earnings ESP suggests potential for an earnings beat [11]. Historical Performance - In the last reported quarter, International Flavors had an earnings surprise of +24.36%, reporting $0.97 per share against an expectation of $0.78 [12]. - Over the past four quarters, the company has beaten consensus EPS estimates three times [13]. Industry Context - Linde, a peer in the Zacks Chemical - Specialty industry, is expected to report earnings of $3.93 per share, reflecting a year-over-year increase of 4.8%, with revenues projected at $8.26 billion, up 2% [17]. - Linde's consensus EPS estimate has been revised 0.1% higher, and it has a positive Earnings ESP of 0.30%, indicating a likely earnings beat [18].

Core Insights - International Flavors & Fragrances Inc. (IFF) plans to consolidate its business operations in Mexico at a new site within the Tecnoparque business complex, enhancing customer demand fulfillment, product market entry, and sustainability efforts [1][3] Group 1: Strategic Move - The new facility in Tecnoparque will include labs for product creation, design, testing, R&D, and business services, along with collaborative spaces for immersive experiences and co-creation with customers [2] - This strategic consolidation will leverage Mexico's rich culture and support business development across Latin America and the Caribbean, aligning with IFF's global growth strategy [3] Group 2: Facility Details - The consolidation will start with the Global Business Services Center, expected to be completed by 2026, and will encompass 50,000 square meters of green space [4] - The new facilities will feature a sophisticated water-management system and responsible waste management, generating enough solar power to meet energy demands [4] Group 3: Employment Impact - The consolidation is projected to create 650 job opportunities across various business segments, making it one of IFF's largest office locations [5] Group 4: Stock Performance - IFF's stock has declined by 9.8% over the past year, compared to a 4.8% decline in the industry [6]

International Flavors (IFF) shares ended the last trading session 9.2% higher at $72.97. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 16.3% loss over the past four weeks.International Flavors’ shares got a boost yesterday after U.S President Trump announced a 90-day pause on certain tariffs for most countries (except China). IFF’s shares also gained since the company announced that it partnered with Florida Poly ...

International Flavors & Fragrances Inc. (IFF) shares have lost 24.4% in the past six months compared with the industry’s 8.3% decline. This mainly reflects the impacts of lower volumes in the Food Ingredients business and higher manufacturing expenses. Supply-chain challenges and the effects of the Pharma segment divestiture have also impacted IFF’s results.  Image Source: Zacks Investment Research Low Volume, High Costs Act as WoesInternational Flavors continues to incur high raw material costs and additio ...

A month has gone by since the last earnings report for International Flavors (IFF) . Shares have lost about 1.8% in that time frame, outperforming the S&P 500.Will the recent negative trend continue leading up to its next earnings release, or is International Flavors due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.How Have Estimates Been Moving Sin ...

Financial Performance - In 2024, total sales were $11.484 billion, remaining flat compared to $11.479 billion in 2023, but increased by 3% on a currency neutral basis [240]. - Gross profit in 2024 increased by $443 million, or 12%, to $4.124 billion, representing 35.9% of sales, compared to 32.1% in 2023 [242]. - Total net sales for 2024 were $11.484 billion, a slight increase from $11.479 billion in 2023, with a comparable portfolio excluding divestitures showing a growth of approximately $244 million [246]. - Segment Adjusted Operating EBITDA increased to $2.205 billion in 2024, up from $1.980 billion in 2023, with a total margin of 19.2% compared to 17.2% in the previous year [267]. Sales by Segment - The Nourish segment experienced a 3% decline in sales, while the Health & Biosciences segment saw a 6% increase in reported sales [245]. - Nourish segment sales decreased by $189 million, or 3%, to $5.871 billion in 2024, while currency neutral sales increased by 4% driven by volume increases across all business units [247]. - Health & Biosciences segment sales increased by $131 million, or 6%, to $2.212 billion in 2024, with an 8% increase on a currency neutral basis due to volume and price increases [248]. - Scent segment sales rose by $47 million, or 2%, to $2.440 billion in 2024, with a 7% increase on a currency neutral basis driven by price and volume increases [249]. - Pharma Solutions segment sales increased by $16 million, or 2%, to $961 million in 2024, maintaining a 2% increase on a currency neutral basis [251]. Expenses - Research and development (R&D) expenses increased by 6% to $671 million in 2024, representing 5.8% of sales [244]. - Selling and Administrative (S&A) expenses rose by $208 million to $1.995 billion, representing 17.4% of sales in 2024, up from 15.6% in 2023 [254]. - Cost of sales decreased by $438 million to $7.360 billion, representing 64.1% of sales in 2024, down from 67.9% in 2023 [252]. Impairment Charges - The company recorded an impairment charge of $64 million for the Pharma Solutions segment in 2024, significantly lower than the $2.623 billion impairment in the Nourish segment in 2023 [230][231]. - The Company recorded a non-cash goodwill impairment charge of $64 million for the Pharma Solutions disposal group during the quarter ended June 30, 2024 [316]. - A goodwill impairment charge of $2.623 billion was recorded for the Nourish reporting unit for the year ended December 31, 2023 [319]. - The Company anticipates a material impairment charge in the range of $1.0 billion to $1.5 billion in the first quarter of fiscal 2025 due to the restructuring of the Nourish segment into two operating segments: Taste and Food Ingredients [321]. Taxation - The effective tax rate for 2024 was 11.2%, compared to a negative rate of 1.8% in 2023 [244]. - The effective tax rate increased to 11.2% in 2024 from (1.8)% in 2023, primarily due to an increase in pre-tax income and changes in the mix of earnings [262]. Cash Flows - Cash flows from operating activities in 2024 were $1.070 billion, or 9.3% of sales, down from $1.439 billion, or 12.5% of sales in 2023 [276]. - Cash flows from investing activities decreased to $326 million in 2024 from $574 million in 2023, primarily due to lower net proceeds from business divestitures [277]. - Cash flows used in financing activities were $1.606 billion in 2024, a decrease from $1.851 billion in 2023, mainly due to lower dividends paid [279]. - Dividends paid totaled $514 million in 2024, down from $826 million in 2023, with cash dividend declared per share at $1.60 compared to $3.24 in 2023 [280]. Debt and Capital Management - As of December 31, 2024, the net debt to credit adjusted EBITDA ratio was 3.84 to 1.0, below the covenant limit [287]. - Total debt as of December 31, 2024, was approximately $9.005 billion, with net debt at $8.534 billion [290]. - The company had $8.478 billion in senior unsecured notes outstanding, with effective interest rates ranging from 1.22% to 5.12% [291]. - The company had no outstanding borrowings under its $2 billion Revolving Credit Facility as of December 31, 2024, with available capacity of $922 million [286]. - The company anticipates capital spending in 2025 to be approximately 6% of sales [278]. - The company plans to prioritize capital investment in its businesses to support strategic long-term plans while maintaining its investment grade rating [281]. Foreign Currency and Risk Management - The company actively monitors foreign currency exposures and employs various techniques, including hedging activities, to mitigate the impact of exchange rate fluctuations [335]. - As of December 31, 2024, the estimated fair value of foreign currency forward contracts would change by approximately $475 million with a hypothetical 10% change in applicable exchange rates [337]. - The aggregate fair value of cross currency swaps was $90 million as of December 31, 2024, with an estimated change of approximately $143 million based on a hypothetical 10% change in the value of the U.S. dollar against the Euro [338]. - The fair value of EUR fixed rate debt was $813 million as of December 31, 2024, with an estimated change of approximately $90 million based on a hypothetical 10% change in foreign exchange rates [339]. - The fair value of USD fixed rate debt was $6.338 billion as of December 31, 2024, with an estimated change of approximately $634 million based on a hypothetical 10% change in interest rates [339]. - The total amount of outstanding debt subject to interest rate fluctuations was $413 million as of December 31, 2024, with an estimated annual interest expense change of approximately $4 million based on a hypothetical 1% change in interest rates [340]. - The company has established a centralized reporting system to evaluate the effects of changes in interest rates and currency exchange rates [336]. - The company enters into foreign currency forward contracts to manage exchange rate risk related to foreign currency denominated monetary assets and liabilities [337]. - The company does not generally use commodity financial instruments to hedge commodity prices, except for soy and natural gas [341]. - The company utilizes statistical analyses of cash flows and sensitivity analysis as part of its risk management procedures [336].

International Flavors & Fragrances Inc. (NYSE:IFF) Q4 2024 Earnings Call Transcript February 19, 2025 9:00 AM ET Company Participants Michael Bender - Director, Investor Relations Erik Fyrwald - Chief Executive Officer Michael DeVeau - EVP, Chief Financial Officer Conference Call Participants Kristen Owen - Oppenheimer Josh Spector - UBS Nicola Tang - BNP Paribas Emily Fusco - Deutsche Bank Eric Zhang - Citi Lisa Neve - Morgan Stanley Steve Byrne - Bank of America John Roberts - Mizuho Mike Sison - Wells Fa ...