International Flavors & Fragrances(US:IFF)2025-11-04 21:21Financial Performance - Third quarter 2025 reported sales were $2.7 billion, a decrease of 8% year-over-year, while currency neutral sales were flat[2][8]. - Reported earnings per share (EPS) for the third quarter was $0.16, while adjusted EPS excluding amortization was $1.05[2][8]. - Net sales for Q3 2025 were $2,694 million, a decrease of 8% compared to $2,925 million in Q3 2024[33]. - Gross profit for Q3 2025 was $983 million, down 7% from $1,052 million in Q3 2024[33]. - The company reported a net loss of $390 million for the nine months ended September 30, 2025, compared to a net income of $327 million for the same period in 2024[37]. - Total net sales for the nine months ended September 30, 2025, reached $8,301 million, a decrease from $8,925 million in the same period of 2024, representing a decline of approximately 7.0%[42]. - The company reported a loss before taxes of $434 million for the nine months ended September 30, 2025, compared to a profit of $95 million for the same period in 2024[42]. - The net loss for Q3 2025 was $392 million, compared to a net income of $323 million in Q3 2024, indicating a significant shift in performance[70]. - The company reported a significant impairment of goodwill amounting to $1.153 billion for the nine months ended September 30, 2025[85]. Operational Metrics - Adjusted operating EBITDA for the third quarter was $519 million, with a currency neutral adjusted operating EBITDA improvement of 7% compared to the prior year[2][8]. - Adjusted Operating EBITDA for the three months ended September 30, 2025, was $519 million, down from $568 million in the prior year, reflecting a decrease of about 8.6%[39]. - The segment Adjusted Operating EBITDA margin for the consolidated business was 19.3% for Q3 2025, compared to 19.4% in Q3 2024, indicating a slight contraction[39][40]. - Adjusted operating EBITDA margin for the Taste segment was 20.2%, while the Health & Biosciences segment reported a margin of 26.0%[9][15]. - The consolidated adjusted operating EBITDA margin for the nine months ended September 30, 2024, was 19.9%, with the Health & Biosciences segment achieving a margin of 26.7%[43]. - The consolidated segment adjusted operating EBITDA margin improved to 19.3% in Q3 2025 from 18.4% in Q3 2024[85]. Cash Flow and Assets - Cash flows from operations for the first nine months of 2025 totaled $532 million, with free cash flow of $126 million[8]. - Cash and cash equivalents increased to $621 million as of September 30, 2025, from $469 million at the end of 2024[35]. - Total assets decreased to $25,768 million as of September 30, 2025, down from $28,723 million at the end of 2024[35]. - The company reported a net cash provided by operating activities of $532 million for the nine months ended September 30, 2025[37]. Segment Performance - The Scent segment reported a 6% increase in currency neutral sales, while the Food Ingredients segment saw a 2% decrease[6][9]. - The Taste segment reported net sales of $635 million, a 2.6% increase compared to $619 million in Q3 2024[85]. - Health & Biosciences segment achieved net sales of $577 million, a 1.6% increase from $568 million in Q3 2024[85]. - Scent segment sales increased by 6.4% to $652 million from $613 million in Q3 2024[85]. - The Pharma Solutions segment reported net sales of $369 million for the nine months ended September 30, 2025, compared to $337 million in the same period of 2024[85]. Expenses - Research and development expenses increased by 7% to $174 million in Q3 2025, compared to $162 million in Q3 2024[33]. - Selling and administrative expenses decreased by 15% to $421 million in Q3 2025, down from $495 million in Q3 2024[33]. - Selling and administrative expenses for the three months ended September 30, 2025, were $387 million, compared to $396 million in the same period of 2024, reflecting a decrease of about 2.3%[39][40]. - Adjusted (Non-GAAP) selling and administrative expenses for Q3 2025 were $1,171 million, down from $1,215 million in Q3 2024, representing a decrease of 4%[65]. Future Outlook - The company expects full year 2025 sales to be in the range of $10.6 billion to $10.9 billion and adjusted operating EBITDA to be between $2 billion and $2.15 billion[10]. - The company maintains an outlook for 1% to 4% comparable currency neutral sales growth for the full year 2025[11]. - Foreign exchange is expected to have a 1% adverse impact on sales growth and a 3% adverse impact on adjusted operating EBITDA growth in 2025[12]. - Adjusted operating EBITDA is expected to be a key metric for understanding future financial guidance, although specific GAAP metrics are not provided[30].