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International Flavors (IFF) Q4 Earnings & Sales Top Estimates
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International Flavors & Fragrances Inc. (IFF - Free Report) reported adjusted earnings of $1.32 per share in fourth-quarter 2020, beating the Zacks Consensus Estimate of $1.19. The bottom-line figure however, declined 9.6% from the year-ago quarter.
Including one-time items, earnings per share in the fourth quarter came in at 57 cents per share compared with the 70 cents per share recorded in the year-ago quarter.
In the reported quarter, International Flavors’ net sales were $1,270 million, down 1% year over year. The top-line figure, nonetheless, topped the Zacks Consensus Estimate of $1,260 million. During the December-end quarter, currency neutral sales dropped 2%, including an approximately 4 percentage point negative impact associated with an additional sales week in fourth-quarter 2019.
Operational Highlights
During the October-December quarter, International Flavors’ cost of goods sold was down 3% year over year to $756 million. Adjusted gross profit climbed 2.2% year over year to $514 million. Adjusted gross margin came in at 40% compared with the 39% witnessed in the year-ago quarter.
Research and development expenses flared up 17% year over year to around $100 million. Adjusted selling and administrative expenses shot up 7.7% year on year to $210 million during the fourth quarter. Adjusted operating profit declined 10.3% year over year to $156 million. Adjusted operating margin came in at 12.3% compared with the year-earlier quarter’s 13.5%.
International Flavors & Fragrances Inc. Price, Consensus and EPS Surprise
Revenues in the Taste segment dipped 4% year over year to $766 million during the December-end quarter. On a constant-currency basis, revenues declined 5% year over year. Food Service continued to witness pressure, declining double-digits on a reported and currency-neutral basis. Operating profit fell 9% year on year to $90 million.
Revenues generated in the Scent segment came in at $504.2 million, up 5% year over year. On a constant-currency basis, revenues were up 3% year over year. Consumer Fragrance remained solid, aided by strong growth in Home Care & Personal Wash. Fine Fragrance returned to growth on new customer wins in North America and Europe. Fragrance Ingredients was solid on double-digit growth in Cosmetic Actives. Operating profit increased 3.9% year over year to $80 million.
Financial Position
International Flavors had cash and cash equivalents of $660 million as of Dec 31, 2020, up from $624 million as of Dec 31, 2019. Long-term debt declined to $3,779 million as of Dec 31, 2020, from $3,997 million as of Dec 31, 2019.
International Flavors generated $714 million of cash from operating activities in 2020 compared with the $699 million recorded in 2019. Capital invested in purchasing property, plant and equipment totaled $192 million in 2020 compared with the prior year’s $236 million. Dividend paid summed $323 million at the end of 2020.
2020 Performance
International Flavors reported adjusted earnings per share of $5.70 for 2020 compared with the $6.17 reported in 2019. Earnings also beat the Zacks Consensus Estimate of $5.60. Including one-time items, the bottom line came in at $3.21, down 19.7% from 2019.
Sales were down 1% year over year to $5.08 billion from the prior-year figure of $5.14 billion. The top line matched the Zacks Consensus Estimate.
2021 Guidance
International Flavors expects sales of $11.5 billion in 2021, including approximately $507-million sales related to the completion of the merger deal with DuPont’s (DD - Free Report) Nutrition & Biosciences ("N&B") business. Moreover, adjusted EBITDA margin is projected at around 23.2%.
Price Performance
Over the past six months, International Flavors’ shares have gained 6.8%, outperforming the industry’s growth of 3.4%.
Zacks Rank & Key Picks
International Flavors currently carries a Zacks Rank #3 (Hold).
Coca-Cola Femsa has a long-term earnings growth rate of 9.6%. The stock has gained 4.5% in the past six months.
Diageo has a long-term earnings growth rate of 8.3%. Its shares have rallied 18.3% in six months’ time.
+1,500% Growth: One of 2021’s Most Exciting Investment Opportunities
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Zacks has released a special report to help you capitalize on the Internet of Things’s exponential growth. It reveals 4 under-the-radar stocks that could be some of the most profitable holdings in your portfolio in 2021 and beyond.
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International Flavors (IFF) Q4 Earnings & Sales Top Estimates
International Flavors & Fragrances Inc. (IFF - Free Report) reported adjusted earnings of $1.32 per share in fourth-quarter 2020, beating the Zacks Consensus Estimate of $1.19. The bottom-line figure however, declined 9.6% from the year-ago quarter.
Including one-time items, earnings per share in the fourth quarter came in at 57 cents per share compared with the 70 cents per share recorded in the year-ago quarter.
In the reported quarter, International Flavors’ net sales were $1,270 million, down 1% year over year. The top-line figure, nonetheless, topped the Zacks Consensus Estimate of $1,260 million. During the December-end quarter, currency neutral sales dropped 2%, including an approximately 4 percentage point negative impact associated with an additional sales week in fourth-quarter 2019.
Operational Highlights
During the October-December quarter, International Flavors’ cost of goods sold was down 3% year over year to $756 million. Adjusted gross profit climbed 2.2% year over year to $514 million. Adjusted gross margin came in at 40% compared with the 39% witnessed in the year-ago quarter.
Research and development expenses flared up 17% year over year to around $100 million. Adjusted selling and administrative expenses shot up 7.7% year on year to $210 million during the fourth quarter. Adjusted operating profit declined 10.3% year over year to $156 million. Adjusted operating margin came in at 12.3% compared with the year-earlier quarter’s 13.5%.
International Flavors & Fragrances Inc. Price, Consensus and EPS Surprise
International Flavors & Fragrances Inc. price-consensus-eps-surprise-chart | International Flavors & Fragrances Inc. Quote
Segmental Performances
Revenues in the Taste segment dipped 4% year over year to $766 million during the December-end quarter. On a constant-currency basis, revenues declined 5% year over year. Food Service continued to witness pressure, declining double-digits on a reported and currency-neutral basis. Operating profit fell 9% year on year to $90 million.
Revenues generated in the Scent segment came in at $504.2 million, up 5% year over year. On a constant-currency basis, revenues were up 3% year over year. Consumer Fragrance remained solid, aided by strong growth in Home Care & Personal Wash. Fine Fragrance returned to growth on new customer wins in North America and Europe. Fragrance Ingredients was solid on double-digit growth in Cosmetic Actives. Operating profit increased 3.9% year over year to $80 million.
Financial Position
International Flavors had cash and cash equivalents of $660 million as of Dec 31, 2020, up from $624 million as of Dec 31, 2019. Long-term debt declined to $3,779 million as of Dec 31, 2020, from $3,997 million as of Dec 31, 2019.
International Flavors generated $714 million of cash from operating activities in 2020 compared with the $699 million recorded in 2019. Capital invested in purchasing property, plant and equipment totaled $192 million in 2020 compared with the prior year’s $236 million. Dividend paid summed $323 million at the end of 2020.
2020 Performance
International Flavors reported adjusted earnings per share of $5.70 for 2020 compared with the $6.17 reported in 2019. Earnings also beat the Zacks Consensus Estimate of $5.60. Including one-time items, the bottom line came in at $3.21, down 19.7% from 2019.
Sales were down 1% year over year to $5.08 billion from the prior-year figure of $5.14 billion. The top line matched the Zacks Consensus Estimate.
2021 Guidance
International Flavors expects sales of $11.5 billion in 2021, including approximately $507-million sales related to the completion of the merger deal with DuPont’s (DD - Free Report) Nutrition & Biosciences ("N&B") business. Moreover, adjusted EBITDA margin is projected at around 23.2%.
Price Performance
Over the past six months, International Flavors’ shares have gained 6.8%, outperforming the industry’s growth of 3.4%.
Zacks Rank & Key Picks
International Flavors currently carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the Consumer Staples sector are Coca-Cola Femsa S.A.B. de and C.V. (KOF - Free Report) and Diageo plc (DEO - Free Report) , each carrying a Zacks Rank #2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Coca-Cola Femsa has a long-term earnings growth rate of 9.6%. The stock has gained 4.5% in the past six months.
Diageo has a long-term earnings growth rate of 8.3%. Its shares have rallied 18.3% in six months’ time.
+1,500% Growth: One of 2021’s Most Exciting Investment Opportunities
In addition to the stocks you read about above, would you like to see Zacks’ top picks to capitalize on the Internet of Things (IoT)? It is one of the fastest-growing technologies in history, with an estimated 77 billion devices to be connected by 2025. That works out to 127 new devices per second.
Zacks has released a special report to help you capitalize on the Internet of Things’s exponential growth. It reveals 4 under-the-radar stocks that could be some of the most profitable holdings in your portfolio in 2021 and beyond.
Click here to download this report FREE >>