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International Flavors (IFF) Tops Q1 Earnings & Sales Estimates
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International Flavors & Fragrances Inc. (IFF - Free Report) reported adjusted earnings of $1.57 per share in first-quarter 2019, beating the Zacks Consensus Estimate of $1.50. The bottom line declined 11.7% from the year-ago quarter’s $1.78. Strong legacy business performance and Frutarom aided double-digit growth in sales and adjusted operating profit in the reported quarter.
Including one-time items, earnings per share in the quarter came in at 96 cents compared with $1.63 recorded in the year-ago quarter.
In the reported quarter, International Flavors’ net sales were $1.3 billion, reflecting year-over-year jump of 39%. Further, the top-line figure surpassed the Zacks Consensus Estimate of $1.2 billion.
Operational Highlights
In the first quarter, International Flavors’ cost of goods sold rose 46% year over year to $766 million. Adjusted gross profit increased 31.2% year over year to $539.7 million. Adjusted gross margin came in at 41.5% compared with 44.2% witnessed in the year-ago quarter.
Research and development expenses flared up 15% year over year to $90.6 million. Adjusted selling and administrative expenses in the first quarter rose 37.6% year over year to $196.9 million. Adjusted operating profit increased 13% year over year to $204.7 million. Adjusted operating margin came in at 15.7% compared with the year-ago quarter’s 19.4%.
Internationa Flavors & Fragrances, Inc. Price, Consensus and EPS Surprise
Revenues in the Taste segment edged down 0.9%, year over year, to $444.6 million during the March-end quarter. On a constant-currency basis, revenues grew 3% year over year. Operating profit declined 2.7% year over year to $108.4 million.
Revenues generated from the Scent segment came in at $488.3 million, up 1.3% year over year. On a constant-currency basis, revenues improved 3% year over year. Operating profit dropped 8% year over year to $85.8 million.
In October 2018, International Flavors completed the acquisition of Frutarom Industries Ltd. The Frutarom segment’s revenues came in at $364.4 million and operating profit was $29 million during the January-March quarter.
Balance Sheet and Cash Flow
Exiting the first quarter, International Flavors had cash and cash equivalents of $497.1 million, down from the $648.5 million recorded at the end of 2018. Long-term debt fell to $4,421 million as of Mar 31, 2019, from $4,504 million as of Dec 31, 2018.
International Flavors generated $47.2 million of cash from operating activities during the three-month period ended Mar 31, 2019, compared with cash usage of $11.4 million reported in the comparable period last year.
Capital invested in purchasing property, plant and equipment totaled $57.6 million during the three-month period ended Mar 31, 2019, surging 74.5% from the comparable period last year. Dividend paid totaled $77.8 million in the reported quarter.
Outlook
International Flavors has reaffirmed its guidance for 2019. Sales are projected in the range of $5.2-$5.3 billion. Adjusted earnings per share are expected in the band of $4.90-$5.10 and adjusted earnings excluding amortization are anticipated in the range of $6.30-$6.50. The company expects to achieve cost savings of $30-$35 million this year.
Share Price Performance
Over the past year, International Flavors’ shares have rallied around 8.9%, outperforming the industry’s gain of 7.1%.
Zacks Rank & Stocks to Consider
International Flavors currently carries a Zacks Rank #3 (Hold).
Sandstorm Gold has an expected earnings growth rate of 189% for 2019. The company’s shares have gained 8.3% in the past year.
Arconic has an estimated earnings growth rate of 3.5% for the current year. The company’s shares have appreciated 25.8% in a year’s time.
Arch Coal has a projected earnings growth rate of 5.49% for 2019. Its shares have rallied 22.3% over the past year.
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International Flavors (IFF) Tops Q1 Earnings & Sales Estimates
International Flavors & Fragrances Inc. (IFF - Free Report) reported adjusted earnings of $1.57 per share in first-quarter 2019, beating the Zacks Consensus Estimate of $1.50. The bottom line declined 11.7% from the year-ago quarter’s $1.78. Strong legacy business performance and Frutarom aided double-digit growth in sales and adjusted operating profit in the reported quarter.
Including one-time items, earnings per share in the quarter came in at 96 cents compared with $1.63 recorded in the year-ago quarter.
In the reported quarter, International Flavors’ net sales were $1.3 billion, reflecting year-over-year jump of 39%. Further, the top-line figure surpassed the Zacks Consensus Estimate of $1.2 billion.
Operational Highlights
In the first quarter, International Flavors’ cost of goods sold rose 46% year over year to $766 million. Adjusted gross profit increased 31.2% year over year to $539.7 million. Adjusted gross margin came in at 41.5% compared with 44.2% witnessed in the year-ago quarter.
Research and development expenses flared up 15% year over year to $90.6 million. Adjusted selling and administrative expenses in the first quarter rose 37.6% year over year to $196.9 million. Adjusted operating profit increased 13% year over year to $204.7 million. Adjusted operating margin came in at 15.7% compared with the year-ago quarter’s 19.4%.
Internationa Flavors & Fragrances, Inc. Price, Consensus and EPS Surprise
Internationa Flavors & Fragrances, Inc. Price, Consensus and EPS Surprise | Internationa Flavors & Fragrances, Inc. Quote
Segmental Performances
Revenues in the Taste segment edged down 0.9%, year over year, to $444.6 million during the March-end quarter. On a constant-currency basis, revenues grew 3% year over year. Operating profit declined 2.7% year over year to $108.4 million.
Revenues generated from the Scent segment came in at $488.3 million, up 1.3% year over year. On a constant-currency basis, revenues improved 3% year over year. Operating profit dropped 8% year over year to $85.8 million.
In October 2018, International Flavors completed the acquisition of Frutarom Industries Ltd. The Frutarom segment’s revenues came in at $364.4 million and operating profit was $29 million during the January-March quarter.
Balance Sheet and Cash Flow
Exiting the first quarter, International Flavors had cash and cash equivalents of $497.1 million, down from the $648.5 million recorded at the end of 2018. Long-term debt fell to $4,421 million as of Mar 31, 2019, from $4,504 million as of Dec 31, 2018.
International Flavors generated $47.2 million of cash from operating activities during the three-month period ended Mar 31, 2019, compared with cash usage of $11.4 million reported in the comparable period last year.
Capital invested in purchasing property, plant and equipment totaled $57.6 million during the three-month period ended Mar 31, 2019, surging 74.5% from the comparable period last year. Dividend paid totaled $77.8 million in the reported quarter.
Outlook
International Flavors has reaffirmed its guidance for 2019. Sales are projected in the range of $5.2-$5.3 billion. Adjusted earnings per share are expected in the band of $4.90-$5.10 and adjusted earnings excluding amortization are anticipated in the range of $6.30-$6.50. The company expects to achieve cost savings of $30-$35 million this year.
Share Price Performance
Over the past year, International Flavors’ shares have rallied around 8.9%, outperforming the industry’s gain of 7.1%.
Zacks Rank & Stocks to Consider
International Flavors currently carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the Basic Materials space are Sandstorm Gold Ltd (SAND - Free Report) , Arconic Inc. and Arch Coal Inc. (ARCH - Free Report) . While Sandstorm Gold sports a Zacks Rank #1 (Strong Buy), Arconic and Arch Coal carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Sandstorm Gold has an expected earnings growth rate of 189% for 2019. The company’s shares have gained 8.3% in the past year.
Arconic has an estimated earnings growth rate of 3.5% for the current year. The company’s shares have appreciated 25.8% in a year’s time.
Arch Coal has a projected earnings growth rate of 5.49% for 2019. Its shares have rallied 22.3% over the past year.
Radical New Technology Creates $12.3 Trillion Opportunity
Imagine buying Microsoft stock in the early days of personal computers… or Motorola after it released the world’s first cell phone. These technologies changed our lives and created massive profits for investors.
Today, we’re on the brink of the next quantum leap in technology. 7 innovative companies are leading this “4th Industrial Revolution” - and early investors stand to earn the biggest profits.
See the 7 breakthrough stocks now>>