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International Flavors & Fragrances 8-K Report, Financial Results (Nov 5, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed November 5, 2024
Period End
November 5, 2024
Security
IFF
In the record · 2016–202610-K1110-Q338-K151

IFF filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 151 current reports (8-K) between 2016 and 2026.

  1. Deal closed8-K · Oct ’18Oct ’18
  2. Deal closed8-K · Feb ’21Feb ’21
  3. Leadership change8-K · Feb ’23Feb ’23
  4. Leadership change8-K · Nov ’26Nov ’26

01—Abstract

Summary

Summary of the 8-K filed November 5, 2024. Cited figures are marked; the original filing is the authoritative source.

International Flavors & Fragrances Inc. (IFF) furnished its press release reporting results for the quarter ended September 30, 2024.

Third-quarter net sales were $2.93 billiona, up 4% versus the prior-year period, with currency neutral sales up 9% on a comparable basis. Reported income before income taxes was $95 million and reported EPS was $0.23, while adjusted EPS excluding amortization was $1.04 per diluted share, increasing 17% versus the prior year. Adjusted operating EBITDA for the quarter was $568 million, with a 19.4% margin, and improved 16% on a comparable basis.

Management described the quarter as showing growth across all business segments, with volume growth in every division. For the first nine months of 2024, net sales were $8.71 billionb and income before taxes was $393 million, with reported EPS of $1.13 and adjusted EPS ex amortization of $3.34. Operating cash flow for the nine months was $702 million and free cash flow was $399 million.

Net debt to credit adjusted EBITDA was 3.9x at the end of the quarter. The filing also reports a goodwill impairment of $64 millionc and a $314 million loss on assets classified as held for sale related to the Pharma Solutions disposal group, alongside a $348 million net gain on business disposals for the nine months.

The company raised its full-year 2024 guidance: sales are now expected at $11.3 billion to $11.4 billiond (previously $11.1 billion to $11.3 billion), adjusted operating EBITDA is expected at the high end of the $2.1 billion to $2.17 billion range, and volume is now expected to rise 5% to 6% (previously 3% to 5%). Foreign exchange is now expected to have an approximately 3% adverse impact on sales growth.

02—Key points

Key Highlights

  1. Third-quarter 2024 net sales of $2.93 billion, up 4% reported and up 9% on a currency neutral comparable basis, with volume up high-single digits.
  2. Adjusted EPS ex amortization of $1.04 per diluted share, up 17% year over year; reported GAAP EPS of $0.23.
  3. Adjusted operating EBITDA of $568 million for the quarter, a 19.4% margin, improving 16% on a comparable basis.
  4. Nine-month reported income before taxes of $393 million, including a $348 million gain on business disposals and a $314 million loss on assets held for sale.
  5. Full-year 2024 guidance raised: sales of $11.3 billion to $11.4 billion and volume growth of 5% to 6%; adjusted operating EBITDA expected at the high end of $2.1 billion to $2.17 billion.
  6. Net debt to credit adjusted EBITDA of 3.9x at September 30, 2024, with third-quarter free cash flow of $399 million defined as operating cash flow less capital expenditures.
  7. Goodwill impairment of $64 million related to the Pharma Solutions disposal group, with the Pharma Solutions sale process ongoing.

03—Questions

Frequently Asked Questions

  1. How did IFF perform in the third quarter of 2024?

    Net sales were $2.93 billion, up 4% versus the prior-year period, and currency neutral sales on a comparable basis rose 9%. Adjusted EPS ex amortization was $1.04, up 17%, while reported EPS was $0.23.

  2. Why did IFF raise its full-year 2024 guidance?

    Management cited strong third-quarter performance and a cautiously optimistic outlook for the fourth quarter. The company now expects sales of $11.3 billion to $11.4 billion and volume growth of 5% to 6%, up from prior ranges.

  3. What is the difference between reported and adjusted results?

    Reported third-quarter income before taxes was $95 million, while adjusted operating EBITDA was $568 million. Adjusted measures exclude items such as depreciation and amortization, interest, acquisition and divestiture costs, restructuring, regulatory costs and losses on business disposals or held-for-sale assets.

  4. What drove the large nine-month reported charges and gains?

    The nine-month results include a $348 million net gain on business disposals, offset by a $314 million loss on assets classified as held for sale, a $64 million goodwill impairment tied to the Pharma Solutions disposal group, and $172 million of acquisition, divestiture and integration costs.

  5. What is the company's leverage and cash position?

    At September 30, 2024, net debt to credit adjusted EBITDA was 3.9x, and cash, cash equivalents and restricted cash totaled $567 million on the balance sheet. Year-to-date operating cash flow was $702 million.

04—Continue

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