Sensient Technologies Corporation Reports Results for the Quarter Ended September 30, 2021

Sensient Technologies Corporation Reports Results for the Quarter Ended September 30, 2021




Sensient Technologies Corporation Reports Results for the Quarter Ended September 30, 2021

Reported Consolidated Revenue Growth of 6.4%

Adjusted Consolidated Local Currency Revenue Growth of 13.0%

Flavors & Extracts Continues its Strong Performance

Color Reports Double Digit Revenue and Profit Growth

MILWAUKEE–(BUSINESS WIRE)–Sensient Technologies Corporation (NYSE: SXT) reported consolidated revenue of $344.3 million in this year’s third quarter compared to $323.6 million in last year’s third quarter. Reported operating income in the third quarter of 2021 was $47.0 million compared to $41.2 million in the third quarter of 2020. Reported diluted earnings per share was 80 cents in the third quarter of 2021 compared to 78 cents in the third quarter of 2020. Foreign currency translation increased revenue by approximately 1% and was not material to earnings per share in the quarter.

The 2021 third quarter reported results include divestiture & other related costs and operational improvement plan costs, which in total decreased third quarter net earnings by $1.8 million ($0.04 per diluted share). The 2020 third quarter reported results include divestiture & other related costs and operational improvement plan costs, which decreased net earnings by $1.4 million ($0.03 per diluted share). The 2021 and 2020 third quarter results also include the operations of the divested product lines, which included $1.6 million of revenue and were not material to diluted earnings per share in the third quarter of 2021, and included $23.6 million of revenue and increased diluted earnings per share by $0.04 in the third quarter of 2020. These adjustments are described in more detail under “Reconciliation of Non-GAAP Amounts” at the end of this release.

BUSINESS REVIEW
 

Reported

Revenue

Quarter

Year-to-Date

Flavors & Extracts

-0.7%

1.6%

Color

19.6%

7.1%

Asia Pacific

8.8%

11.8%

Total Revenue

6.4%

4.3%

 

Adjusted

Local Currency (1)

Revenue

Quarter

Year-to-Date

Flavors & Extracts

11.6%

9.9%

Color

18.1%

7.3%

Asia Pacific

9.5%

8.4%

Total Revenue

13.0%

8.6%

 
(1) Adjusted local currency percentage changes are described in more detail in the “Reconciliation of Non-GAAP Amounts” at the end of this release.

The Flavors & Extracts Group reported third quarter revenue of $181.7 million compared to $182.9 million reported in the comparable period last year, a decrease of 0.7%, primarily due to the divestiture of the Fragrances product line in April 2021. Adjusted local currency revenue increased 11.6% in the quarter. The higher adjusted local currency revenue was primarily the result of favorable volume growth. Segment operating income was $25.2 million in the current quarter compared to $23.8 million reported in the comparable period last year, an increase of 5.5%. Adjusted local currency operating income increased 16.0% in the quarter. The Group’s higher profit was primarily a result of the favorable volume growth. The acquisition of Flavor Solutions, Inc. during the third quarter contributed $2.4 million of revenue and an immaterial amount of operating income to the Flavors & Extracts Group. Foreign currency translation increased both segment revenue and operating income by approximately 1% in the quarter.

The Color Group reported revenue of $139.2 million in the quarter compared to $116.4 million in last year’s comparable period, an increase of 19.6%. Adjusted local currency revenue increased 18.1% in the quarter. The Group experienced strong volume growth in Food & Pharmaceutical Colors and in Personal Care. Segment operating income was $27.3 million in the quarter compared to $23.6 million in last year’s comparable period, an increase of 15.7%. Adjusted local currency operating income increased 14.8% compared to the prior year’s third quarter. The higher operating income is primarily a result of the higher volumes. Foreign currency translation increased both segment revenue and operating income by approximately 2% in the quarter.

The Asia Pacific Group reported revenue of $33.4 million in the quarter compared to $30.7 million in last year’s comparable period, an increase of 8.8%. Adjusted local currency revenue increased 9.5% in the quarter. Segment operating income was $6.6 million in the quarter compared to $6.1 million in last year’s comparable quarter, an increase of 7.8%. Adjusted local currency operating income increased 10.5% in the quarter. The higher profit was primarily a result of the favorable volume growth. Foreign currency translation decreased segment revenue and operating income by approximately 1% and 2%, respectively, in the quarter.

Corporate & Other reported operating costs of $12.1 million in the current quarter compared to $12.4 million in last year’s comparable period, a decrease of 2.5%. The lower costs are primarily due to lower operational improvement plan costs reported in the third quarter of 2021 compared to the amount recorded in the third quarter of 2020. Adjusted local currency operating expenses for Corporate & Other increased 19% in the quarter primarily due to higher performance based compensation.

2021 OUTLOOK

Sensient is reconfirming its previously issued 2021 guidance for GAAP diluted earnings per share to grow at a mid-to-high single-digit growth rate compared to the Company’s 2020 reported GAAP diluted earnings per share of $2.59. Our full year 2021 guidance includes approximately 25 cents per share of estimated divestiture & other related costs, the results of the divested operations, and the operational improvement plan costs.

The Company now expects its 2021 adjusted local currency revenue(2) to grow at a high single-digit rate. The Company’s previous 2021 guidance for adjusted local currency revenue(2) was a mid-single-digit growth rate. The Company also now expects its 2021 adjusted local currency EBITDA(2) and adjusted diluted earnings per share(2), on a local currency basis, to grow at a mid-to-high single-digit growth rate. The Company’s previous 2021 adjusted local currency EBITDA(2) and adjusted diluted earnings per share(2) called for a mid-single-digit growth rate.

The Company expects earnings per share reported on a U.S. dollar basis to benefit by approximately seven cents based on current exchange rates.

The Company’s guidance is based upon current trends, current tax law, and the effects of COVID-19 to date. The full impacts of the ongoing COVID-19 pandemic remain uncertain and management will continue to monitor its impacts on our business.

       

(2)

See “Reconciliation of Non-GAAP Amounts” at the end of this release for more information.

USE OF NON-GAAP FINANCIAL MEASURES

The Company’s non-GAAP financial measures eliminate the impact of certain items, which, depending on the measure, include, currency movements, depreciation and amortization, non-cash share-based compensation, divestiture & other related costs, operational improvement plan costs, and the results of the divested operations. These measures are provided to enhance the overall understanding of the Company’s performance when viewed together with the GAAP results. Refer to “Reconciliation of Non-GAAP Amounts” at the end of this release.

CONFERENCE CALL

The Company will host a conference call to discuss its 2021 third quarter financial results at 8:30 a.m. CDT on Friday, October 15, 2021. To participate in the conference call, contact Chorus Call Inc. at (844) 492-3726 or (412) 317-1078, and ask to join the Sensient Technologies Corporation conference call. Alternatively, the call can be accessed by using the webcast link that is available on the Investor Information section of the Company’s web site at www.sensient.com.

A replay of the call will be available one hour after the end of the conference call through October 22, 2021, by calling (877) 344-7529 and referring to conference identification number 10159962. An audio replay and written transcript of the call will also be posted on the Investor Information section of the Company’s web site at www.sensient.com on or after October 19, 2021.

This release contains statements that may constitute “forward-looking statements” within the meaning of Federal securities laws including under “2021 Outlook” above. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors concerning the Company’s operations and business environment. Important factors that could cause actual results to differ materially from those suggested by these forward-looking statements and that could adversely affect the Company’s future financial performance include the following: the impact and uncertainty created by the ongoing COVID-19 pandemic, including, but not limited to, its effects on our employees, facilities, customers, and suppliers, the availability and cost of raw materials and other supplies, the availability of logistics and transportation, governmental regulations and restrictions and general economic conditions; the pace and nature of new product introductions by the Company and the Company’s customers; the Company’s ability to anticipate and respond to changing consumer preferences and changing technologies; the Company’s ability to successfully implement its growth strategies; the outcome of the Company’s various productivity-improvement and cost-reduction efforts, acquisition and divestiture activities, and operational improvement plan; the effectiveness of the Company’s past restructuring activities; changes in costs of raw materials, including energy; industry, regulatory, legal, and economic factors related to the Company’s domestic and international business; the effects of tariffs, trade barriers, and disputes; growth in markets for products in which the Company competes; industry and customer acceptance of price increases; actions by competitors; currency exchange rate fluctuations; and other factors included in “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, and in other documents that the Company files with the SEC. The risks and uncertainties identified above are not the only risks the Company faces. Additional risks and uncertainties not presently known to the Company or that it currently believes to be immaterial also may adversely affect the Company. Should any known or unknown risks and uncertainties develop into actual events, these developments could have material adverse effects on our business, financial condition, and results of operations. This release contains time-sensitive information that reflects management’s best analysis only as of the date of this release. Except to the extent required by applicable laws, the Company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied herein will not be realized.

ABOUT SENSIENT TECHNOLOGIES

Sensient Technologies Corporation is a leading global manufacturer and marketer of colors, flavors, and other specialty ingredients. Sensient uses advanced technologies and robust global supply chain capabilities to develop specialized solutions for food and beverages, as well as products that serve the pharmaceutical, nutraceutical, cosmetic, and personal care industries. Sensient’s customers range in size from small entrepreneurial businesses to major international manufacturers representing some of the world’s best-known brands. Sensient is headquartered in Milwaukee, Wisconsin.

www.sensient.com

Sensient Technologies Corporation
(In thousands, except percentages and per share amounts)
(Unaudited)
 
Consolidated Statements of Earnings

Three Months Ended September 30,

Nine Months Ended September 30,

 

2021

2020

% Change

2021

2020

% Change

 
Revenue

$

344,287

 

$

323,566

 

6.4

%

$

1,039,816

 

$

997,333

 

4.3

%

 
Cost of products sold

 

229,216

 

 

217,920

 

5.2

%

 

697,538

 

 

677,580

 

2.9

%

Selling and administrative expenses

 

68,113

 

 

64,491

 

5.6

%

 

212,670

 

 

201,912

 

5.3

%

 
Operating income

 

46,958

 

 

41,155

 

14.1

%

 

129,608

 

 

117,841

 

10.0

%

Interest expense

 

3,037

 

 

3,497

 

 

9,792

 

 

11,412

 

 
Earnings before income taxes

 

43,921

 

 

37,658

 

 

119,816

 

 

106,429

 

Income taxes

 

10,009

 

 

4,748

 

 

28,300

 

 

22,126

 

 
Net earnings

$

33,912

 

$

32,910

 

3.0

%

$

91,516

 

$

84,303

 

8.6

%

 
Earnings per share of common stock:
Basic

$

0.81

 

$

0.78

 

$

2.17

 

$

1.99

 

 
Diluted

$

0.80

 

$

0.78

 

$

2.16

 

$

1.99

 

 
Average common shares outstanding:
Basic

 

42,024

 

 

42,307

 

 

42,140

 

 

42,299

 

 
Diluted

 

42,206

 

 

42,349

 

 

42,287

 

 

42,326

 

 
 
 
Results by Segment

Three Months Ended September 30,

Nine Months Ended September 30,

 

Revenue

2021

2020

% Change

2021

2020

% Change

 
Flavors & Extracts

$

181,667

 

$

182,866

 

(0.7

%)

$

561,979

 

$

552,975

 

1.6

%

Color

 

139,239

 

 

116,414

 

19.6

%

 

408,166

 

 

381,205

 

7.1

%

Asia Pacific

 

33,442

 

 

30,740

 

8.8

%

 

99,599

 

 

89,062

 

11.8

%

Intersegment elimination

 

(10,061

)

 

(6,454

)

 

(29,928

)

 

(25,909

)

 
Consolidated

$

344,287

 

$

323,566

 

6.4

%

$

1,039,816

 

$

997,333

 

4.3

%

 
 
Operating Income
 
Flavors & Extracts

$

25,164

 

$

23,844

 

5.5

%

$

76,718

 

$

67,467

 

13.7

%

Color

 

27,253

 

 

23,559

 

15.7

%

 

79,462

 

 

75,486

 

5.3

%

Asia Pacific

 

6,601

 

 

6,123

 

7.8

%

 

19,146

 

 

16,031

 

19.4

%

Corporate & Other

 

(12,060

)

 

(12,371

)

 

(45,718

)

 

(41,143

)

 
Consolidated

$

46,958

 

$

41,155

 

14.1

%

$

129,608

 

$

117,841

 

10.0

%

Sensient Technologies Corporation
(In thousands)
(Unaudited)
 
Consolidated Condensed Balance Sheets

September 30,

December 31,

2021

2020

 
Cash and cash equivalents

$

32,939

$

24,770

Trade accounts receivable

 

263,710

 

234,132

Inventories

 

392,231

 

381,346

Prepaid expenses and other current assets

 

50,081

 

48,578

Assets held for sale

 

 

52,760

Total Current Assets

 

738,961

 

741,586

 
Goodwill & intangible assets (net)

 

437,729

 

434,220

Property, plant, and equipment (net)

 

437,789

 

445,493

Other assets

 

113,937

 

119,561

 
Total Assets

$

1,728,416

$

1,740,860

 
Trade accounts payable

$

123,894

$

107,324

Short-term borrowings

 

10,483

 

9,247

Other current liabilities

 

89,988

 

82,045

Liabilities held for sale

 

 

17,339

Total Current Liabilities

 

224,365

 

215,955

 
Long-term debt

 

490,901

 

518,004

Accrued employee and retiree benefits

 

30,258

 

28,941

Other liabilities

 

43,500

 

43,624

Shareholders’ Equity

 

939,392

 

934,336

 
Total Liabilities and Shareholders’ Equity

$

1,728,416

$

1,740,860

Sensient Technologies Corporation
(In thousands, except per share amounts)
(Unaudited)
 
Consolidated Statements of Cash Flows
Nine Months Ended September 30,

2021

2020

Cash flows from operating activities:
Net earnings

$

91,516

 

$

84,303

 

Adjustments to arrive at net cash provided by operating activities:
 
Depreciation and amortization

 

38,828

 

 

36,831

 

Share-based compensation expense

 

6,431

 

 

4,017

 

Net loss (gain) on assets

 

203

 

 

(254

)

Loss on divestitures and other charges

 

13,774

 

 

5,821

 

Deferred income taxes

 

3,793

 

 

(9,001

)

Changes in operating assets and liabilities:
Trade accounts receivable

 

(35,290

)

 

(7,962

)

Inventories

 

(15,898

)

 

17,433

 

Prepaid expenses and other assets

 

(15,016

)

 

(4,726

)

Trade accounts payable and other accrued expenses

 

24,007

 

 

9,018

 

Accrued salaries, wages, and withholdings

 

1,763

 

 

7,410

 

Income taxes

 

(1,155

)

 

(3,899

)

Other liabilities

 

3,192

 

 

3,936

 

 
Net cash provided by operating activities

 

116,148

 

 

142,927

 

 
Cash flows from investing activities:
Acquisition of property, plant, and equipment

 

(37,608

)

 

(34,009

)

Proceeds from sale of assets

 

201

 

 

1,022

 

Proceeds from divestiture of businesses

 

36,790

 

 

12,228

 

Acquisition of new business

 

(13,875

)

 

 

Other investing activities

 

1,348

 

 

4,955

 

 
Net cash used in investing activities

 

(13,144

)

 

(15,804

)

 
Cash flows from financing activities:
Proceeds from additional borrowings

 

55,589

 

 

33,164

 

Debt payments

 

(67,534

)

 

(101,061

)

Purchase of treasury stock

 

(31,467

)

 

 

Dividends paid

 

(49,468

)

 

(49,537

)

Other financing activities

 

(582

)

 

(415

)

 
Net cash used in financing activities

 

(93,462

)

 

(117,849

)

 
Effect of exchange rate changes on cash and cash equivalents

 

(1,373

)

 

(3,527

)

 
Net increase in cash and cash equivalents

 

8,169

 

 

5,747

 

Cash and cash equivalents at beginning of period

 

24,770

 

 

21,153

 

Cash and cash equivalents at end of period

$

32,939

 

$

26,900

 

 
 
Supplemental Information
Nine Months Ended September 30,

2021

2020

 
Dividends paid per share

$

1.17

 

$

1.17

 

Sensient Technologies Corporation
(In thousands, except percentages and per share amounts)
(Unaudited)
 
Reconciliation of Non-GAAP Amounts
 
The Company’s results for the three and nine months ended September 30, 2021 and 2020 include adjusted revenue, adjusted operating income, adjusted net earnings, and adjusted diluted earnings per share, which exclude divestiture & other related costs, operational improvement plan costs and income, and the results of the divested operations.

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

% Change

2021

2020

% Change

 
Revenue (GAAP)

$

344,287

 

$

323,566

 

6.4

%

$

1,039,816

 

$

997,333

 

4.3

%

Revenue of the divested product lines

 

(1,622

)

 

(23,588

)

 

(29,399

)

 

(88,390

)

Adjusted revenue

$

342,665

 

$

299,978

 

14.2

%

$

1,010,417

 

$

908,943

 

11.2

%

 
Operating income (GAAP)

$

46,958

 

$

41,155

 

14.1

%

$

129,608

 

$

117,841

 

10.0

%

Divestiture & other related costs (income) – Cost of products sold

 

 

 

(148

)

 

28

 

 

1,791

 

Divestiture & other related costs – Selling and administrative expenses

 

241

 

 

312

 

 

13,473

 

 

8,689

 

Operating loss (income) of the divested product lines

 

70

 

 

(2,449

)

 

(2,398

)

 

(4,165

)

Operational improvement plan – Cost of products sold

 

 

 

35

 

 

 

 

35

 

Operational improvement plan – Selling and administrative expenses (income)

 

483

 

 

2,606

 

 

(2,010

)

 

2,606

 

Adjusted operating income

$

47,752

 

$

41,511

 

15.0

%

$

138,701

 

$

126,797

 

9.4

%

 
Net earnings (GAAP)

$

33,912

 

$

32,910

 

3.0

%

$

91,516

 

$

84,303

 

8.6

%

Divestiture & other related costs, before tax

 

241

 

 

164

 

 

13,501

 

 

10,480

 

Tax impact of divestiture & other related costs

 

1,179

 

 

(787

)

 

283

 

 

(1,212

)

Net loss (earnings) of the divested product lines, before tax

 

70

 

 

(2,449

)

 

(2,398

)

 

(4,165

)

Tax impact of the divested product lines

 

(18

)

 

655

 

 

590

 

 

1,155

 

Operational improvement plan costs (income), before tax

 

483

 

 

2,641

 

 

(2,010

)

 

2,641

 

Tax impact of operational improvement plan

 

(115

)

 

(656

)

 

44

 

 

(656

)

Adjusted net earnings

$

35,752

 

$

32,478

 

10.1

%

$

101,526

 

$

92,546

 

9.7

%

 
Diluted earnings per share (GAAP)

$

0.80

 

$

0.78

 

2.6

%

$

2.16

 

$

1.99

 

8.5

%

Divestiture & other related costs (income), net of tax

 

0.03

 

 

(0.01

)

 

0.33

 

 

0.22

 

Results of operations of the divested product lines, net of tax

 

0.00

 

 

(0.04

)

 

(0.04

)

 

(0.07

)

Operational improvement plan costs (income), net of tax

 

0.01

 

 

0.05

 

 

(0.05

)

 

0.05

 

Adjusted diluted earnings per share

$

0.85

 

$

0.77

 

10.4

%

$

2.40

 

$

2.19

 

9.6

%

 
Note: Earnings per share calculations may not foot due to rounding differences.
Sensient Technologies Corporation
(In thousands)
(Unaudited)
 
Reconciliation of Non-GAAP Amounts – Continued
 
Results by Segment

Three Months Ended September 30,

Adjusted

Adjusted

Revenue

2021

Adjustments (1)

2021

2020

Adjustments (1)

2020

 
Flavors & Extracts

$

181,667

 

$

(1,312

)

$

180,355

 

$

182,866

 

$

(22,978

)

$

159,888

 

Color

 

139,239

 

 

(310

)

 

138,929

 

 

116,414

 

 

(669

)

 

115,745

 

Asia Pacific

 

33,442

 

 

 

 

33,442

 

 

30,740

 

 

(68

)

 

30,672

 

Intersegment elimination

 

(10,061

)

 

 

 

(10,061

)

 

(6,454

)

 

127

 

 

(6,327

)

 
Consolidated

$

344,287

 

$

(1,622

)

$

342,665

 

$

323,566

 

$

(23,588

)

$

299,978

 

 
Operating Income
 
Flavors & Extracts

$

25,164

 

$

66

 

$

25,230

 

$

23,844

 

$

(2,241

)

$

21,603

 

Color

 

27,253

 

 

4

 

 

27,257

 

 

23,559

 

 

(185

)

 

23,374

 

Asia Pacific

 

6,601

 

 

 

 

6,601

 

 

6,123

 

 

(23

)

 

6,100

 

Corporate & Other

 

(12,060

)

 

724

 

 

(11,336

)

 

(12,371

)

 

2,805

 

 

(9,566

)

 
Consolidated

$

46,958

 

$

794

 

$

47,752

 

$

41,155

 

$

356

 

$

41,511

 

 
Results by Segment

Nine Months Ended September 30,

Adjusted

Adjusted

Revenue

2021

Adjustments (1)

2021

2020

Adjustments (1)

2020

 
Flavors & Extracts

$

561,979

 

$

(27,616

)

$

534,363

 

$

552,975

 

$

(75,165

)

$

477,810

 

Color

 

408,166

 

 

(1,638

)

 

406,528

 

 

381,205

 

 

(13,242

)

 

367,963

 

Asia Pacific

 

99,599

 

 

(295

)

 

99,304

 

 

89,062

 

 

(402

)

 

88,660

 

Intersegment elimination

 

(29,928

)

 

150

 

 

(29,778

)

 

(25,909

)

 

419

 

 

(25,490

)

 
Consolidated

$

1,039,816

 

$

(29,399

)

$

1,010,417

 

$

997,333

 

$

(88,390

)

$

908,943

 

 
Operating Income
 
Flavors & Extracts

$

76,718

 

$

(2,859

)

$

73,859

 

$

67,467

 

$

(5,078

)

$

62,389

 

Color

 

79,462

 

 

548

 

 

80,010

 

 

75,486

 

 

1,029

 

 

76,515

 

Asia Pacific

 

19,146

 

 

(87

)

 

19,059

 

 

16,031

 

 

(116

)

 

15,915

 

Corporate & Other

 

(45,718

)

 

11,491

 

 

(34,227

)

 

(41,143

)

 

13,121

 

 

(28,022

)

 
Consolidated

$

129,608

 

$

9,093

 

$

138,701

 

$

117,841

 

$

8,956

 

$

126,797

 

 
(1) For Revenue, adjustments consist of revenues of the divested product lines. For Operating Income, adjustments consist of the results of the divested product lines, divestiture & other related costs, and operational improvement plan costs and income.
Sensient Technologies Corporation
(In thousands, except percentages)
(Unaudited)
 
Reconciliation of Non-GAAP Amounts – Continued
 
The following tables summarize the percentage change in the 2021 results compared to the 2020 results for the corresponding periods.
 

Three Months Ended September 30,

Revenue

Total

Foreign

Exchange

Rates

Adjustments (2)

Adjusted

Local

Currency

Flavors & Extracts

 

(0.7

%)

 

1.1

%

(13.4

%)

 

11.6

%

Color

 

19.6

%

 

1.9

%

(0.4

%)

 

18.1

%

Asia Pacific

 

8.8

%

 

(0.5

%)

(0.2

%)

 

9.5

%

Total Revenue

 

6.4

%

 

1.2

%

(7.8

%)

 

13.0

%

 
Operating Income
Flavors & Extracts

 

5.5

%

 

0.6

%

(11.1

%)

 

16.0

%

Color

 

15.7

%

 

1.8

%

(0.9

%)

 

14.8

%

Asia Pacific

 

7.8

%

 

(2.3

%)

(0.4

%)

 

10.5

%

Corporate & Other

 

(2.5

%)

 

0.0

%

(21.0

%)

 

18.5

%

Total Operating Income

 

14.1

%

 

1.1

%

(0.9

%)

 

13.9

%

Diluted Earnings Per Share

 

2.6

%

 

0.0

%

(6.5

%)

 

9.1

%

Adjusted EBITDA

 

14.2

%

 

1.3

%

N/A

 

 

12.9

%

 

Nine Months Ended September 30,

Revenue

Total

Foreign

Exchange

Rates

Adjustments (2)

Adjusted

Local

Currency

Flavors & Extracts

 

1.6

%

 

2.4

%

(10.7

%)

 

9.9

%

Color

 

7.1

%

 

3.2

%

(3.4

%)

 

7.3

%

Asia Pacific

 

11.8

%

 

3.6

%

(0.2

%)

 

8.4

%

Total Revenue

 

4.3

%

 

2.8

%

(7.1

%)

 

8.6

%

 
Operating Income
Flavors & Extracts

 

13.7

%

 

1.9

%

(4.9

%)

 

16.7

%

Color

 

5.3

%

 

3.5

%

0.8

%

 

1.0

%

Asia Pacific

 

19.4

%

 

(0.7

%)

(0.3

%)

 

20.4

%

Corporate & Other

 

11.1

%

 

0.0

%

(11.0

%)

 

22.1

%

Total Operating Income

 

10.0

%

 

3.2

%

0.3

%

 

6.5

%

Diluted Earnings Per Share

 

8.5

%

 

3.0

%

(1.3

%)

 

6.8

%

Adjusted EBITDA

 

9.7

%

 

2.8

%

N/A

 

 

6.9

%

 
(2) For Revenue, adjustments consist of revenues of the divested product lines. For Operating Income, Diluted Earnings per Share, and Adjusted EBITDA, adjustments consist of the results of the divested product lines, divestiture & other related costs, and operational improvement plan costs and income.
 
The following table summarizes the reconciliation between Operating Income (GAAP) and Adjusted EBITDA for the three and nine months ended September 30, 2021 and 2020.
 

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

% Change

2021

2020

% Change

Operating income (GAAP)

$

46,958

 

$

41,155

 

14.1

%

$

129,608

 

$

117,841

 

10.0

%

Depreciation and amortization

 

13,011

 

 

12,309

 

 

38,828

 

 

36,831

 

Depreciation and amortization, divested product lines

 

(49

)

 

(49

)

 

(146

)

 

(145

)

Share-based compensation expense

 

2,243

 

 

1,355

 

 

6,431

 

 

4,017

 

Divestiture & other related costs, before tax

 

241

 

 

164

 

 

13,501

 

 

10,480

 

Results of operations of the divested product lines, before tax

 

70

 

 

(2,449

)

 

(2,398

)

 

(4,165

)

Operational improvement plan costs (income), before tax

 

483

 

 

2,641

 

 

(2,010

)

 

2,641

 

Adjusted EBITDA

$

62,957

 

$

55,126

 

14.2

%

$

183,814

 

$

167,500

 

9.7

%

 
The following table summarizes the reconciliation between Net cash provided by operating activities (GAAP) and Free Cash Flow for the three and nine months ended September 30, 2021 and 2020.
 

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

% Change

2021

2020

% Change

Net cash provided by operating activities (GAAP)

$

26,887

 

$

35,313

 

(23.9

%)

$

116,148

 

$

142,927

 

(18.7

%)

Capital expenditures

 

(12,058

)

 

(12,592

)

 

(37,608

)

 

(34,009

)

Free Cash Flow

$

14,829

 

$

22,721

 

(34.7

%)

$

78,540

 

$

108,918

 

(27.9

%)

 
We have included each of these non-GAAP measures in order to provide additional information regarding our underlying operating results and comparable period-over-period performance. Such information is supplemental to information presented in accordance with GAAP and is not intended to represent a presentation in accordance with GAAP. These non-GAAP measures should not be considered in isolation. Rather, they should be considered together with GAAP measures and the rest of the information included in this release and our SEC filings. Management internally reviews each of these non-GAAP measures to evaluate performance on a comparative period-to-period basis and to gain additional insight into underlying operating and performance trends, and we believe the information can be beneficial to investors for the same purposes. These non-GAAP measures may not be comparable to similarly titled measures used by other companies.

Contacts

Amy Agallar

(414) 347-3706

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