Sensient Technologies Corporation Reports Results for the Quarter Ended March 31, 2025
MILWAUKEE--(BUSINESS WIRE)--April 25, 2025--
Sensient Technologies Corporation $(SXT)$, a leading provider of flavors and colors for the food, pharmaceutical, and personal care markets, today reported financial results for the first quarter ended March 31, 2025.
First Quarter Consolidated Results
-- Reported revenue increased 2.0% to $392.3 million in the first quarter of
2025 versus last year's first quarter results of $384.7 million. On a
local currency basis(1), revenue increased 4.1%.
-- Reported operating income increased 8.3% to $53.5 million compared to
$49.4 million recorded in the first quarter of 2024. In the first quarter
of 2025, the Company recorded $2.9 million of costs related to its
Portfolio Optimization Plan versus last year's $2.8 million in the first
quarter. Local currency adjusted operating income(1) and local currency
adjusted EBITDA(1) increased 10.3% and 10.1%, respectively, in the first
quarter.
-- Reported earnings per share increased 11.0% to 81 cents in the first
quarter of 2025 compared to 73 cents in the first quarter of 2024. Local
currency adjusted diluted EPS(1) increased 11.4% in the first quarter.
"As expected, Sensient got off to a strong start in the first quarter of 2025, building on the momentum from the previous year. Our results are driven by solid volume growth and sales wins, particularly in natural colors. The quarter's achievements underscore our ability to adapt in dynamic market conditions, and I am pleased to reaffirm our 2025 guidance," said Paul Manning, Sensient's Chairman, President, and Chief Executive Officer.
First Quarter Group Results
Reported Local Currency(1)
Revenue Quarter Quarter
----------------------- -------- --------------------------
Flavors & Extracts 0.3% 1.7%
Color 4.8% 8.2%
Asia Pacific 4.0% 4.8%
Total Revenue 2.0% 4.1%
Reported Local Currency Adjusted(1)
Operating Income Quarter Quarter
----------------------- -------- --------------------------
Flavors & Extracts 5.5% 6.2%
Color 10.0% 13.5%
Asia Pacific 7.6% 7.0%
Total Operating Income 8.3% 10.3%
The Flavors & Extracts Group reported first quarter 2025 revenue of $193.7 million, an increase of $0.6 million versus the prior year's first quarter. The Group's revenue benefited from higher volumes in our flavors, extracts, and flavor ingredients product lines, offset by lower volumes in natural ingredients. Segment operating income was $25.0 million in the first quarter of 2025, an increase of $1.3 million compared to the prior year's first quarter.
The Color Group reported revenue of $167.8 million in the first quarter of 2025, an increase of $7.7 million compared to the prior year's first quarter. The Group's revenue increase was broad-based across all product lines. Segment operating income was $34.9 million in the first quarter of 2025, an increase of $3.2 million compared to the prior year's first quarter results.
The Asia Pacific Group reported revenue of $41.9 million in the first quarter of 2025, an increase of $1.6 million compared to the prior year's first quarter. The Group's revenue increased across nearly all geographies. Segment operating income was $9.4 million in the quarter, an increase of $0.7 million compared to the prior year's first quarter.
Corporate & Other reported operating expenses of $15.8 million in the first quarter of 2025, compared to $14.7 million of operating expenses reported in the prior year's first quarter. Local currency adjusted operating expenses(1) for Corporate & Other increased $1.0 million compared to the prior year's first quarter, primarily due to higher performance-based compensation costs recorded in 2025.
2025 OUTLOOK
Metric Current Guidance
------------------------------------- -------------------------------------
Local Currency Revenue(1) Mid-Single-Digit Growth
Local Currency Adjusted EBITDA(1) Mid-Single-Digit to High Single-Digit
Growth
Diluted EPS (GAAP) Between $3.13 and $3.23*
Local Currency Adjusted Diluted High Single-Digit to Double-Digit
EPS(1) Growth
*Includes approximately 15 cents of Portfolio Optimization Plan costs. Based
on current exchange rates, foreign currency impact is expected to be
approximately a 2 cent headwind for the year. Previous range was between $3.05
and $3.15.
------------------------------------------------------------------------------
The Company's guidance is based on current conditions and economic and market trends in the markets in which the Company operates and is subject to various risks and uncertainties as described below.
(1) Please refer to "Reconciliation of Non-GAAP Amounts" at the end of this
release for more information regarding our non-GAAP financial
measures.
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, Portfolio Optimization Plan costs, and non-cash share-based compensation. 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 2025 first quarter financial results at 8:30 a.m. CDT on Friday, April 25, 2025. 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 May 2, 2025, by calling (877) 344-7529 and using access code 4206177. 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 April 29, 2025.
This release contains statements that may constitute "forward-looking statements" within the meaning of Federal securities laws including under "2025 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 Company's ability to manage general business, economic, and capital market conditions, including actions taken by customers in response to such market conditions, and the impact of recessions and economic downturns; the impact of macroeconomic and geopolitical volatility, including inflation and shortages impacting the availability and cost of raw materials, energy, and other supplies, disruptions and delays in the Company's supply chain, and the conflicts between Russia and Ukraine and in the Middle East; industry, regulatory, legal, and economic factors related to the Company's domestic and international business; the effects of tariffs, trade barriers, and disputes; the availability and cost of labor, logistics, and transportation; 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, changing technologies, and changing regulations; 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 Portfolio Optimization Plan; growth in markets for products in which the Company competes; industry and customer acceptance of price increases; actions by competitors; the Company's ability to enhance its innovation efforts and drive cost efficiencies; 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, 2024, 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, 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 March 31,
--------------------------------------
2025 2024 % Change
-------------- ---------- ----------
Revenue $ 392,325 $ 384,670 2.0%
Cost of products sold 260,548 258,121 0.9%
Selling and administrative
expenses 78,247 77,143 1.4%
--------- --------
Operating income 53,530 49,406 8.3%
Interest expense 7,341 7,045
--------- --------
Earnings before income
taxes 46,189 42,361
Income taxes 11,727 11,421
--------- --------
Net earnings $ 34,462 $ 30,940 11.4%
========= ========
Earnings per share of
common stock:
Basic $ 0.82 $ 0.73
========= ========
Diluted $ 0.81 $ 0.73
========= ========
Average common shares
outstanding:
Basic 42,197 42,104
========= ========
Diluted 42,469 42,305
========= ========
Results by Segment Three Months Ended March 31,
--------------------------------------
Revenue 2025 2024 % Change
------------------------- -------------- ---------- ----------
Flavors & Extracts $ 193,681 $ 193,092 0.3%
Color 167,750 160,025 4.8%
Asia Pacific 41,901 40,306 4.0%
Intersegment elimination (11,007) (8,753)
--------- --------
Consolidated $ 392,325 $ 384,670 2.0%
========= ========
Operating Income
--------------------------
Flavors & Extracts $ 24,989 $ 23,678 5.5%
Color 34,852 31,679 10.0%
Asia Pacific 9,442 8,776 7.6%
Corporate & Other (15,753) (14,727)
--------- --------
Consolidated $ 53,530 $ 49,406 8.3%
========= ========
Sensient Technologies Corporation
(In thousands)
(Unaudited)
Consolidated Condensed Balance Sheets March 31, December 31,
2025 2024
---------- --------------
Cash and cash equivalents $ 32,574 $ 26,626
Trade accounts receivable 315,024 290,087
Inventories 598,204 600,302
Prepaid expenses and other current assets 54,407 44,871
--------- ----------
Total Current Assets 1,000,209 961,886
Goodwill & intangible assets (net) 435,681 423,658
Property, plant, and equipment (net) 499,184 491,587
Other assets 157,594 146,663
--------- ----------
Total Assets $2,092,668 $ 2,023,794
========= ==========
Trade accounts payable $ 110,611 $ 139,052
Short-term borrowings 18,575 19,848
Other current liabilities 101,509 111,739
--------- ----------
Total Current Liabilities 230,695 270,639
Long-term debt 683,266 613,523
Accrued employee and retiree benefits 25,175 24,499
Other liabilities 58,498 54,147
Shareholders' Equity 1,095,034 1,060,986
--------- ----------
Total Liabilities and
Shareholders' Equity $2,092,668 $ 2,023,794
========= ==========
Sensient Technologies Corporation
(In thousands, except per share amounts)
(Unaudited)
Consolidated Statements of Cash Flows
Three Months Ended March 31,
2025 2024
--------- -----------
Cash flows from operating activities:
Net earnings $ 34,462 $ 30,940
Adjustments to arrive at net cash
provided by operating activities:
Depreciation and amortization 15,074 14,709
Share-based compensation expense 2,900 1,995
Net loss (gain) on assets 46 (193)
Portfolio Optimization Plan
costs 831 1,189
Deferred income taxes 1,282 (4)
Changes in operating assets and
liabilities:
Trade accounts receivable (20,780) (28,331)
Inventories 7,202 26,624
Prepaid expenses and other
assets (8,064) (13,655)
Trade accounts payable and
other accrued expenses (25,859) (21,993)
Accrued salaries, wages, and
withholdings (21,665) 29
Income taxes 4,989 3,150
Other liabilities 604 674
------- -------
Net cash (used in) provided by operating
activities (8,978) 15,134
------- -------
Cash flows from investing activities:
Acquisition of property, plant, and
equipment (16,854) (11,030)
Proceeds from sale of assets 7 93
Acquisition of new business (4,349) -
Other investing activities (88) (1)
------- -------
Net cash used in investing activities (21,284) (10,938)
------- -------
Cash flows from financing activities:
Proceeds from additional borrowings 66,449 38,053
Debt payments (10,771) (27,031)
Dividends paid (17,376) (17,312)
Other financing activities (2,341) (2,828)
------- -------
Net cash provided by (used in) financing
activities 35,961 (9,118)
------- -------
Effect of exchange rate changes on cash
and cash equivalents 249 1,405
------- -------
Net increase (decrease) in cash and cash
equivalents 5,948 (3,517)
Cash and cash equivalents at beginning of
period 26,626 28,934
------- -------
Cash and cash equivalents at end of
period $ 32,574 $ 25,417
======= =======
Supplemental Information
Three Months Ended March 31, 2025 2024
--------- -----------
Dividends paid per share $ 0.41 $ 0.41
Sensient Technologies Corporation
(In thousands, except percentages and per share amounts)
(Unaudited)
Reconciliation of Non-GAAP Amounts
The Company's results for the three months ended March 31, 2025 and 2024 include adjusted operating income, adjusted
net earnings, and adjusted diluted earnings per share, which, in each case, exclude Portfolio Optimization Plan
costs.
Three Months Ended March 31,
----------------------------------------------------
2025 2024 % Change
------------ ------------------ ------------------
Operating income
(GAAP) $ 53,530 $ 49,406 8.3%
Portfolio
Optimization
Plan costs --
Cost of
products sold 1,814 107
Portfolio
Optimization
Plan costs --
Selling and
administrative
expenses 1,050 2,705
------- ------- -----
Adjusted operating
income $ 56,394 $ 52,218 8.0%
======= ======= =====
Net earnings (GAAP) $ 34,462 $ 30,940 11.4%
Portfolio
Optimization
Plan costs,
before tax 2,864 2,812
Tax impact of
Portfolio
Optimization
Plan costs(1) (702) (355)
------- ------- ----
Adjusted net
earnings $ 36,624 $ 33,397 9.7%
======= ======= =====
Diluted earnings
per share (GAAP) $ 0.81 $ 0.73 11.0%
Portfolio
Optimization
Plan costs, net
of tax 0.05 0.06
------- ------- -----
Adjusted diluted
earnings per
share $ 0.86 $ 0.79 8.9%
======= ======= =====
Note: Earnings per share calculations may not foot due to rounding differences.
(1) Tax impact adjustments were determined based on the nature of the underlying non-GAAP adjustments and their
relevant jurisdictional tax rates.
Results by Segment Three Months Ended March 31,
-------------------------------------------------------------------------------------------------
Adjusted Adjusted
Operating Income 2025 Adjustments(2) 2025 2024 Adjustments(2) 2024
------------------ ------------ ------------------ ------------------ ------------ ---------------- -----------
Flavors & Extracts $ 24,989 $ - $ 24,989 $ 23,678 $ - $ 23,678
Color 34,852 - 34,852 31,679 - 31,679
Asia Pacific 9,442 - 9,442 8,776 - 8,776
Corporate & Other (15,753) 2,864 (12,889) (14,727) 2,812 (11,915)
------- ------- ----- -------- --- ------- ------------ -------
Consolidated $ 53,530 $ 2,864 $ 56,394 $ 49,406 $ 2,812 $ 52,218
======= ======= ===== ======== ==== ======= ============ =======
(2) Adjustments consist of Portfolio Optimization Plan costs.
The following table summarizes the percentage change in the 2025 results compared to the 2024 results for the
corresponding periods.
Three Months Ended March 31, 2025
------------------------------------------------------------------
Foreign Local
Exchange Currency
Revenue Total Rates Adjustments(3) Adjusted
------------ ------------------ ------------------ ------------
Flavors &
Extracts 0.3% (1.4%) N/A 1.7%
Color 4.8% (3.4%) N/A 8.2%
Asia Pacific 4.0% (0.8%) N/A 4.8%
Total Revenue 2.0% (2.1%) N/A 4.1%
Operating Income
Flavors &
Extracts 5.5% (0.7%) 0.0% 6.2%
Color 10.0% (3.5%) 0.0% 13.5%
Asia Pacific 7.6% 0.6% 0.0% 7.0%
Corporate &
Other 7.0% 0.0% (1.2%) 8.2%
Total Operating
Income 8.3% (2.5%) 0.5% 10.3%
Diluted Earnings
Per Share 11.0% (2.7%) 2.3% 11.4%
Adjusted EBITDA 7.9% (2.2%) N/A 10.1%
(3) Adjustments consist of Portfolio Optimization Plan costs.
Sensient Technologies Corporation
(In thousands, except percentages)
(Unaudited)
Reconciliation of Non-GAAP Amounts -
Continued
The following table summarizes the reconciliation between
Operating Income (GAAP) and Adjusted EBITDA for the three months
ended March 31, 2025 and 2024.
Three Months Ended March 31,
-----------------------------------------
2025 2024 % Change
------------------ --------- ----------
Operating income
(GAAP) $ 53,530 $ 49,406 8.3%
Depreciation and
amortization 15,074 14,709
Share-based
compensation
expense 2,900 1,995
Portfolio
Optimization Plan
costs, before
tax 2,864 2,812
--- --------- -------
Adjusted EBITDA $ 74,368 $ 68,922 7.9%
=== ========= ======= =====
The following table summarizes the reconciliation between Debt
(GAAP) and Net Debt, and Operating Income (GAAP) and Credit
Adjusted EBITDA for the trailing twelve months ended March 31,
2025 and 2024.
March 31,
-----------------------------
Debt 2025 2024
------------------ ---------
Short-term
borrowings $ 18,575 $ 19,439
Long-term debt 683,266 643,511
Credit Agreement
adjustments(4) (21,165) (13,775)
--- --------- -------
Net Debt $ 680,676 $649,175
=== ========= =======
Operating income
(GAAP) $ 195,703 $153,591
Depreciation and
amortization 60,694 58,379
Share-based
compensation
expense 10,989 8,661
Portfolio
Optimization
Plan costs,
before tax 6,683 30,653
Other
non-operating
gains(5) (871) (1,055)
--- --------- -------
Credit Adjusted
EBITDA $ 273,198 $250,229
=== ========= =======
Net Debt to Credit 2.5x 2.6x
Adjusted EBITDA
(4) Adjustments include cash and cash equivalents, as described in
the Company's Third Amended and Restated Credit Agreement (Credit
Agreement), and certain letters of credit and hedge contracts.
(5) Adjustments consist of certain financing transaction costs,
certain non-financing interest items, and gains and losses related
to certain non-cash, non-operating, and/or non-recurring items as
described in the Credit Agreement.
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.
Category: Earnings
Source: Sensient Technologies Corporation
View source version on businesswire.com: https://www.businesswire.com/news/home/20250424600201/en/
CONTACT: Amy Agallar
(414) 347-3706
investor.relations@sensient.com
(END) Dow Jones Newswires
April 25, 2025 06:55 ET (10:55 GMT)
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