UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
______________
FORM 8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date of report (Date of earliest
event reported)
|
May
12, 2015
|
INTERNATIONAL
FLAVORS & FRAGRANCES INC.
|
(Exact
Name of Registrant as Specified in Charter)
|
New York
|
1-4858
|
13-1432060
|
(State or Other Jurisdiction
of Incorporation)
|
(Commission
File Number)
|
(I.R.S. Employer
Identification No.)
|
521 West 57th Street, New York, New York
|
10019
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
Registrant’s telephone number, including area code
|
(212) 765-5500
|
Check the
appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any
of the following provisions:
⃞
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
⃞
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
⃞
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
⃞
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item 2.02. Results of Operations and Financial Condition
Attached and being furnished hereby as Exhibit 99.1 is a copy of a press
release of International Flavors & Fragrances Inc. ("IFF" or the
"Company") dated May 12, 2015 reporting IFF's financial results for the
quarter ended March 31, 2015.
An audio webcast to discuss the Company's first quarter 2015 financial
results and full year 2015 outlook will be held today, May 12, 2015, at
10:00 a.m. EST. Interested parties can access the webcast and
accompanying slide presentation on the Company's website at www.iff.com
under the Investor Relations section. For those unable to listen to the
live broadcast, a replay will be available on the Company's website
approximately one hour after the event and will remain available on the
IFF website for one year.
Non-GAAP financial measures: In the attached press release and the
referenced audio webcast, the Company uses the following non-GAAP
financial operating measures: (i) adjusted earnings per share, (ii)
adjusted operating profit, (iii) currency neutral adjusted operating
profit, (iv) adjusted operating profit margin, (v) currency neutral
sales, (vi) adjusted research, selling and administrative (RSA)
expenses, (vii) adjusted effective tax rate and (viii) adjusted gross
profit margin. Such information is supplemental to information presented
in accordance with GAAP and is not intended to represent a presentation
in accordance with GAAP. In discussing the Company’s historical and
expected future results and financial condition, the Company believes it
is meaningful for investors to be made aware of and to be assisted in a
better understanding of, on a period-to-period comparable basis,
financial amounts both including and excluding these identified items,
as well as the impact of exchange rate fluctuations. The Company
believes such additional non-GAAP information provides investors with an
overall perspective of the period-to-period performance of our business.
In addition, management internally reviews each of these non-GAAP
measures to evaluate performance on a comparative period-to-period basis
in terms of absolute performance, trends and expected future performance
with respect to our business. A material limitation of these non-GAAP
measures is that such measures do not reflect actual GAAP amounts. The
Company compensates for such limitations by presenting the
reconciliations contained in the attached press release to the most
directly comparable GAAP measure. These non-GAAP measures may not be
comparable to similarly titled measures used by other
companies.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
99.1 Press Release of International Flavors & Fragrances Inc., dated May
12, 2015
SIGNATURE
Pursuant to
the requirements of the Securities Exchange Act of 1934, the Registrant
has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
|
|
INTERNATIONAL FLAVORS & FRAGRANCES INC.
|
|
|
|
Dated:
|
May 12, 2015
|
/s/ Richard A. O’Leary
|
|
|
Name: Richard A. O’Leary
|
|
|
|
|
|
Title: Interim Chief Financial Officer, Vice President and
Controller
|
Exhibit Index
Number
|
Description
|
99.1
|
Press Release of International Flavors & Fragrances Inc. dated May
12, 2015
|
Exhibit 99.1
IFF
Reports Strong First Quarter 2015 Results
Currency
Neutral Sales Grew 6%; Currency Neutral Adjusted EPS Increased 13%
NEW YORK--(BUSINESS WIRE)--May 12, 2015--International Flavors &
Fragrances Inc. (NYSE:IFF), a leading global creator of flavors and
fragrances for consumer products, today reported financial results for
the first quarter ended March 31, 2015.
First Quarter 2015 Results
-
Currency neutral sales increased 6% reflecting broad-based growth in
both businesses and across all regions. Sales to the emerging markets,
which now represent 51% of total company sales, grew 9% on a currency
neutral basis.
-
Currency neutral adjusted operating profit increased 10% versus the
prior year quarter driven by strong sales growth, and manufacturing
and RSA cost leverage. The net impact on adjusted earnings per share
(EPS) was positive, increasing 13% on a currency neutral basis to
$1.45 per share in the quarter.
-
Reported sales increased $4.7 million, or 1%, to $774.9 million from
$770.2 million in the prior year quarter. On a reported basis,
operating profit rose $5.7 million, or 4%, to $161.8 million from
$156.1 million in the prior year quarter and reported diluted EPS rose
21% to $1.57 from $1.30.
Schedules at the end of this release contain reconciliations of reported
GAAP to non-GAAP financial metrics.
Beginning this quarter, we refer to “currency neutral,” instead of
“local currency.” The change is solely a change in terminology and the
underlying calculation of the measure remains the same.
Management Commentary
“We are pleased with our performance in the first quarter.” said IFF
Chairman and CEO Andreas Fibig. “Financially, we delivered
mid-single-digit sales growth, and double-digit increases in both
adjusted operating profit and adjusted EPS, all on a currency neutral
basis. At the same time, we continued to invest in the business to
support our goal of Winning Where We Compete by bolstering our Flavors
business with the acquisition of Ottens, the opening of a new sales and
creative facility near Chicago, and the expansion of our creative center
in South Africa.”
First Quarter 2015 Segment Results
Fragrances Business Unit
-
Currency neutral sales growth was 5% as nearly all regions delivered
mid to high single-digit growth.
-
Fine Fragrances currency neutral sales declined by 2%, against very
strong 10% growth reported in the year-ago period. A double-digit
increase in Greater Asia was more than offset by softness in North
America and EAME, both of which compared to double-digit growth in the
prior-year period.
-
Consumer Fragrances delivered strong currency neutral sales growth of
9% led by double-digit growth in Fabric Care and Home Care, as well as
mid-single digit growth in Hair Care.
-
Fragrance Ingredients currency neutral sales declined 2% compared to
high double-digit gains in the prior year quarter.
-
Reported sales decreased 1% to $397.8 million in the first quarter of
2015 compared with $403.7 million in the prior year quarter.
-
Fragrances segment profit decreased 6%, or $5.6 million, to $81.6
million in the first quarter of 2015. Segment profit margin decreased
to 20.5%, down 110 basis points from 21.6% in the prior year quarter
as unfavorable net impact of price to input costs and a negative
impact from currency more than offset continued cost control
discipline and productivity programs.
Flavors Business Unit
-
Currency neutral sales grew 9% in the first quarter, against a 5%
year-ago comparison, with growth across all regions led by
double-digit growth in Latin America and North America and high
single-digit growth in EAME.
-
On a category basis, Beverages grew high double-digits with growth
across all regions driven by new win performance and strong innovative
solutions for better-for-you products. Growth was also achieved in all
other categories including Dairy, Sweet and Savory.
-
Reported sales increased 3%, or $10.6 million, to $377.1 million from
$366.5 million in the prior year quarter.
-
Flavors segment profit increased 5%, or $4.7 million, to $92.7 million
in the first quarter of 2015. Segment profit margin improved 60 basis
points to 24.6% from 24.0% in the prior year quarter, reflecting
topline growth, mix benefits, productivity initiatives and disciplined
cost control that more than offset the negative impact of currency.
Management Commentary
Mr. Fibig continued, “Looking to the balance of year, we continue to
believe we can deliver attractive returns to our shareholders. On a
currency neutral basis, we expect all of our key financial metrics to be
in line with our long-term targets in 2015. Yet, if global currencies
remain where they are today throughout the rest of the year, we expect
adjusted operating profit and adjusted EPS to grow low to
mid-single-digits.”
Audio Webcast
A live webcast to discuss the Company's first quarter 2015 financial
results will be held today, May 12, 2015, at 10:00 a.m. EST. Investors
may access the webcast and accompanying slide presentation on the
Company's website at www.iff.com under the Investor Relations
section. For those unable to listen to the live broadcast, a recorded
version of the webcast will be made available on the Company's website
approximately one hour after the event and will remain available on
IFF’s website for one year.
About IFF
International Flavors & Fragrances Inc. (NYSE: IFF) is a leading global
creator of flavors and fragrances used in a wide variety of consumer
products. Consumers experience these unique scents and tastes in fine
fragrances and beauty care, detergents and household goods, as well as
beverages, sweet goods and food products. The Company leverages its
competitive advantages of consumer insight, research and development,
creative expertise, and customer intimacy to provide customers with
innovative and differentiated product offerings. A member of the S&P 500
Index, IFF has more than 6,200 employees working in 32 countries
worldwide. For more information, please visit our website at www.iff.com.
Cautionary Statement Under The Private Securities Litigation
Reform Act of 1995
This press release includes “forward-looking statements” under the
Federal Private Securities Litigation Reform Act of 1995, including
statements regarding our outlook for the second quarter and full year
2015, and our ability to generate shareholder returns and sustain our
long-term growth performance. These forward-looking statements are
qualified in their entirety by cautionary statements and risk factor
disclosures contained in the Company’s Securities and Exchange
Commission filings, including the Company’s Annual Report on Form 10-K
filed with the Commission on March 2, 2015. The Company wishes to
caution readers that certain important factors may have affected and
could in the future affect the Company’s actual results and could cause
the Company’s actual results for subsequent periods to differ materially
from those expressed in any forward-looking statements made by or on
behalf of the Company. With respect to the Company’s expectations
regarding these statements, such factors include, but are not limited
to: (1) volatility and increases in the price of raw materials, energy
and transportation; (2) the economic and political risks associated with
the Company’s international operations; (3) the Company’s ability to
benefit from its investments and expansion in emerging markets; (4)
fluctuations in the quality and availability of raw materials; (5)
changes in consumer preferences and demand for the Company’s products or
a decline in consumer confidence and spending; (6) the Company’s ability
to implement its business strategy, including the achievement of
anticipated cost savings, profitability, realization of price increases
and growth targets; (7) the Company’s ability to successfully develop
new and competitive products that appeal to its customers and consumers;
(8) the impact of a disruption in the Company’s supply chain or its
relationship with its suppliers; (9) the impact of currency fluctuations
or devaluations in the Company’s principal foreign markets; (10) any
adverse impact on the availability, effectiveness and cost of the
Company’s hedging and risk management strategies; (11) the effects of
any unanticipated costs and construction or start-up delays in the
expansion of the Company’s facilities; (12) the Company’s ability to
successfully execute acquisitions, collaborations and joint ventures;
(13) the effect of legal and regulatory proceedings, as well as
restrictions imposed on the Company, its operations or its
representatives by U.S. and foreign governments; (14) adverse changes in
federal, state, local and foreign tax legislation or adverse results of
tax audits, assessments, or disputes; and (15) changes in market
conditions or governmental regulations relating to our pension and
postretirement obligations. New risks emerge from time to time and it is
not possible for management to predict all such risk factors or to
assess the impact of such risks on the Company’s business. Accordingly,
the Company undertakes no obligation to publicly revise any
forward-looking statements, whether as a result of new information,
future events, or otherwise.
|
|
|
International Flavors & Fragrances Inc.
|
|
Consolidated Income Statement
|
|
(Amounts in thousands except per diluted share data)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
2014
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
|
$
|
774,907
|
|
|
$
|
770,224
|
|
1
|
%
|
|
Cost of goods sold
|
|
|
|
428,630
|
|
|
|
428,812
|
|
(0
|
)%
|
|
Gross profit
|
|
|
|
346,277
|
|
|
|
341,412
|
|
1
|
%
|
|
Research and development
|
|
|
|
63,462
|
|
|
|
61,504
|
|
3
|
%
|
|
Selling and administrative
|
|
|
|
120,835
|
|
|
|
123,733
|
|
(2
|
)%
|
|
Restructuring and other charges
|
|
|
|
187
|
|
|
|
122
|
|
|
|
Operating Profit
|
|
|
|
161,793
|
|
|
|
156,053
|
|
|
|
Interest expense
|
|
|
|
11,095
|
|
|
|
11,677
|
|
|
|
Other (income) expense, net
|
|
|
|
(5,710
|
)
|
|
|
1,443
|
|
|
|
Pretax income
|
|
|
|
156,408
|
|
|
|
142,933
|
|
9
|
%
|
|
Income taxes
|
|
|
|
28,150
|
|
|
|
36,226
|
|
(22
|
)%
|
|
Net income
|
|
|
$
|
128,258
|
|
|
$
|
106,707
|
|
20
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share - basic
|
|
|
$
|
1.58
|
|
|
$
|
1.31
|
|
|
|
Earnings per share - diluted
|
|
|
$
|
1.57
|
|
|
$
|
1.30
|
|
|
|
|
|
|
|
|
|
|
|
|
Average shares outstanding
|
|
|
|
|
|
Basic
|
|
|
|
80,654
|
|
|
|
81,053
|
|
|
|
Diluted
|
|
|
|
81,195
|
|
|
|
81,732
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International Flavors & Fragrances Inc.
|
|
Condensed Consolidated Balance Sheet
|
|
(Amounts in thousands)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
|
|
|
2015
|
|
2014
|
|
Cash & cash equivalents
|
|
|
$
|
443,689
|
|
$
|
478,573
|
|
Receivables
|
|
|
|
525,260
|
|
|
493,768
|
|
Inventories
|
|
|
|
536,465
|
|
|
568,729
|
|
Other current assets
|
|
|
|
249,696
|
|
|
168,957
|
|
Total current assets
|
|
|
|
1,755,110
|
|
|
1,710,027
|
|
|
|
|
|
|
|
|
Property, plant and equipment, net
|
|
|
692,008
|
|
|
720,268
|
|
Goodwill and other intangibles, net
|
|
|
750,201
|
|
|
752,041
|
|
Other assets
|
|
|
|
309,853
|
|
|
312,285
|
|
Total assets
|
|
|
$
|
3,507,172
|
|
$
|
3,494,621
|
|
|
|
|
|
|
|
|
Bank borrowings and overdrafts, and
|
|
|
|
current portion of long-term debt
|
|
$
|
8,379
|
|
$
|
8,090
|
|
Other current liabilities
|
|
|
|
478,941
|
|
|
510,718
|
|
Total current liabilities
|
|
|
|
487,320
|
|
|
518,808
|
|
|
|
|
|
|
|
|
Long-term debt
|
|
|
|
935,170
|
|
|
934,232
|
|
Non-current liabilities
|
|
|
|
512,585
|
|
|
518,892
|
|
|
|
|
|
|
|
|
Shareholders' equity
|
|
|
|
1,572,097
|
|
|
1,522,689
|
|
Total liabilities and shareholders' equity
|
|
$
|
3,507,172
|
|
$
|
3,494,621
|
|
|
|
|
|
|
|
|
|
International Flavors & Fragrances Inc.
|
|
Consolidated Statement of Cash Flows
|
|
(Amounts in thousands)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
2015
|
|
|
2014
|
|
|
Cash flows from operating activities:
|
|
|
|
|
|
Net income
|
|
|
|
$
|
128,258
|
|
|
$
|
106,707
|
|
|
Adjustments to reconcile to net cash provided by operations:
|
|
|
|
Depreciation and amortization
|
|
|
|
19,985
|
|
|
|
22,830
|
|
|
Deferred income taxes
|
|
|
|
13,932
|
|
|
|
8,246
|
|
|
(Gain) loss on disposal of assets
|
|
|
|
34
|
|
|
|
(811
|
)
|
|
Stock-based compensation
|
|
|
|
5,387
|
|
|
|
4,695
|
|
|
Pension contributions
|
|
|
|
(54,048
|
)
|
|
|
(5,316
|
)
|
|
Changes in assets and liabilities, net of Aromor acquisition:
|
|
|
|
Current receivables
|
|
|
|
(62,891
|
)
|
|
|
(41,569
|
)
|
|
Inventories
|
|
|
|
|
13,172
|
|
|
|
(591
|
)
|
|
Accounts payable
|
|
|
|
(3,061
|
)
|
|
|
(11,989
|
)
|
|
Accruals for incentive compensation
|
|
|
(27,675
|
)
|
|
|
(62,282
|
)
|
|
Other current payables and accrued expenses
|
|
|
20,264
|
|
|
|
1,096
|
|
|
Changes in other assets/liabilities
|
|
|
|
(21,881
|
)
|
|
|
13,977
|
|
|
Net cash provided by operating activities
|
|
|
31,476
|
|
|
|
34,993
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
Cash paid for acquisition, net of cash received (including $15
million of contingent consideration)
|
|
—
|
|
|
|
(102,400
|
)
|
|
Additions to property, plant and equipment
|
|
|
(19,381
|
)
|
|
|
(33,836
|
)
|
|
Proceeds from life insurance contracts
|
|
|
—
|
|
|
|
12,308
|
|
|
Maturity of net investment hedges
|
|
|
|
—
|
|
|
|
(472
|
)
|
|
Proceeds from disposal of assets
|
|
|
|
1,450
|
|
|
|
2,042
|
|
|
Net cash used in investing activities
|
|
|
(17,931
|
)
|
|
|
(122,358
|
)
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
Cash dividends paid to shareholders
|
|
|
(37,971
|
)
|
|
|
(31,743
|
)
|
|
Net change in revolving credit facility borrowings and overdrafts
|
|
265
|
|
|
|
1,309
|
|
|
Proceeds from issuance of stock under stock plans
|
|
|
227
|
|
|
|
913
|
|
|
Excess tax benefits on stock-based payments
|
|
|
8,597
|
|
|
|
315
|
|
|
Purchase of treasury stock
|
|
|
|
(10,660
|
)
|
|
|
(20,122
|
)
|
|
Net cash used in financing activities
|
|
|
(39,542
|
)
|
|
|
(49,328
|
)
|
|
Effect of exchange rates changes on cash and cash equivalents
|
|
(8,887
|
)
|
|
|
(228
|
)
|
|
Net change in cash and cash equivalents
|
|
|
(34,884
|
)
|
|
|
(136,921
|
)
|
|
Cash and cash equivalents at beginning of year
|
|
|
478,573
|
|
|
|
405,505
|
|
|
Cash and cash equivalents at end of period
|
|
$
|
443,689
|
|
|
$
|
268,584
|
|
|
|
|
|
|
|
|
|
|
International Flavors & Fragrances Inc.
|
|
Business Unit Performance
|
|
(Amounts in thousands)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
2015
|
|
|
|
2014
|
|
|
Net Sales
|
|
|
|
|
|
|
Flavors
|
|
|
$
|
377,108
|
|
|
$
|
366,505
|
|
|
Fragrances
|
|
|
|
397,799
|
|
|
|
403,719
|
|
|
Consolidated
|
|
|
|
774,907
|
|
|
|
770,224
|
|
|
|
|
|
|
|
|
|
Segment Profit
|
|
|
|
|
|
|
Flavors
|
|
|
|
92,727
|
|
|
|
88,063
|
|
|
Fragrances
|
|
|
|
81,598
|
|
|
|
87,166
|
|
|
Global Expenses
|
|
|
|
(11,564
|
)
|
|
|
(16,435
|
)
|
|
Restructuring and other charges, net
|
|
|
|
(187
|
)
|
|
|
(122
|
)
|
|
Acquisition and related costs
|
|
|
|
(500
|
)
|
|
|
—
|
|
|
Operational improvement initiative costs
|
|
|
|
(281
|
)
|
|
|
(2,619
|
)
|
|
Operating profit
|
|
|
|
161,793
|
|
|
|
156,053
|
|
|
|
|
|
|
|
|
|
Interest Expense
|
|
|
|
(11,095
|
)
|
|
|
(11,677
|
)
|
|
Other income, net
|
|
|
|
5,710
|
|
|
|
(1,443
|
)
|
|
Income before taxes
|
|
|
$
|
156,408
|
|
|
$
|
142,933
|
|
|
|
|
|
|
|
|
|
Operating Margin
|
|
|
|
|
|
|
Flavors
|
|
|
|
24.6
|
%
|
|
|
24.0
|
%
|
|
Fragrances
|
|
|
|
20.5
|
%
|
|
|
21.6
|
%
|
|
Consolidated
|
|
|
|
20.9
|
%
|
|
|
20.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International Flavors & Fragrances Inc.
|
|
Sales Performance by Region and Category
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter 2015 vs. 2014
|
|
|
|
|
|
|
|
Percentage Change in Sales by Region of Destination
|
|
|
|
|
|
|
|
Fine Fragrances
|
|
Consumer Fragrances
|
|
Ingredients
|
|
Total Frag.
|
|
Flavors
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America
|
|
Reported
|
|
|
-14%
|
|
5%
|
|
-20%
|
|
-6%
|
|
10%
|
|
2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EAME
|
|
Reported
|
|
|
-13%
|
|
-1%
|
|
-8%
|
|
-7%
|
|
-4%
|
|
-6%
|
|
|
|
Currency Neutral
|
|
|
-1%
|
|
13%
|
|
0%
|
|
6%
|
|
9%
|
|
7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Latin America
|
|
Reported
|
|
|
-1%
|
|
13%
|
|
1%
|
|
9%
|
|
15%
|
|
11%
|
|
|
|
Currency Neutral
|
|
|
2%
|
|
16%
|
|
-4%
|
|
11%
|
|
21%
|
|
14%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Greater Asia
|
|
Reported
|
|
|
36%
|
|
2%
|
|
8%
|
|
3%
|
|
0%
|
|
2%
|
|
|
|
Currency Neutral
|
|
|
38%
|
|
3%
|
|
17%
|
|
6%
|
|
4%
|
|
5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
Reported
|
|
|
-10%
|
|
4%
|
|
-8%
|
|
-1%
|
|
3%
|
|
1%
|
|
|
|
Currency Neutral
|
|
|
-2%
|
|
9%
|
|
-2%
|
|
5%
|
|
9%
|
|
6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Beginning this quarter, we refer to “currency neutral,”
instead of “local currency.” The change is solely a
change in terminology and the underlying calculation of the measure
remains the same.
Currency neutral sales growth is calculated by translating prior year
sales at the exchange rates used for the corresponding 2015 period.
|
|
|
International Flavors & Fragrances Inc.
|
|
GAAP to Non-GAAP Reconciliation
|
|
Foreign Exchange Impact
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
|
Operating Profit
|
|
EPS
|
|
% Change - Reported (GAAP)
|
|
|
1%
|
|
4%
|
|
21%
|
|
Items Impacting Comparability
|
|
|
0%
|
|
-2%
|
|
-11%
|
|
% Change - Adjusted (Non-GAAP)
|
|
|
1%
|
|
2%
|
|
10%
|
|
Currency Impact
|
|
|
5%
|
|
7%
|
|
3%
|
|
% Change - Currency Neutral (Adjusted)
|
|
|
6%
|
|
10%*
|
|
13%
|
|
|
|
|
|
|
|
|
|
|
* The sum of these items do not foot due to rounding.
|
|
|
|
|
|
|
|
|
|
|
Note: Beginning this quarter, we refer to “currency neutral,”
instead of “local currency.” The change is solely a change in
terminology and the underlying calculation of the measure remains the
same.
Currency neutral sales growth is calculated by translating prior year
sales at the exchange rates used for the corresponding 2015 period.
|
|
|
International Flavors & Fragrances Inc.
|
|
GAAP to Non-GAAP Reconciliation
|
|
(Amounts in thousands)
|
|
(Unaudited)
|
|
|
The following information and schedules provide reconciliation
information between reported GAAP amounts and non-GAAP certain adjusted
amounts. This information and schedules are not intended as, and should
not be viewed as, a substitute for reported GAAP amounts or financial
statements of the Company prepared and presented in accordance with GAAP.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter 2015
|
|
|
|
|
|
Items Impacting Comparability
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported (GAAP)
|
|
Restructuring and Other Charges
|
|
Operational Improvement Initiative Costs
|
|
Tax Settlements
|
|
Acquisition and Related Costs
|
|
Adjusted (Non-GAAP)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales
|
|
|
|
|
774,907
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Goods Sold
|
|
|
|
|
428,630
|
|
|
|
|
|
|
|
(281
|
)
|
(b)
|
|
|
|
|
|
|
|
|
|
|
Gross Profit
|
|
|
|
|
346,277
|
|
|
|
|
|
|
|
281
|
|
|
|
|
|
|
|
|
|
|
346,558
|
|
|
Research and Development
|
|
|
|
|
63,462
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling and Administrative
|
|
|
|
|
120,835
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(500
|
)
|
(d)
|
|
|
120,335
|
|
|
RSA Expense
|
|
|
|
|
184,297
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and other charges, net
|
|
|
|
187
|
|
|
|
|
(187
|
)
|
(a)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Profit
|
|
|
|
|
161,793
|
|
|
|
|
187
|
|
|
|
|
281
|
|
|
|
|
|
|
|
500
|
|
|
|
|
162,761
|
|
|
Interest Expense
|
|
|
|
|
11,095
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income, net
|
|
|
|
|
(5,710
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before taxes
|
|
|
|
|
156,408
|
|
|
|
|
187
|
|
|
|
|
281
|
|
|
|
|
|
|
|
500
|
|
|
|
|
|
|
Taxes on Income
|
|
|
|
|
28,150
|
|
|
|
|
66
|
|
|
|
|
70
|
|
|
|
|
10,478
|
|
(c)
|
|
|
175
|
|
|
|
|
38,939
|
|
|
Net Income
|
|
|
|
|
128,258
|
|
|
|
|
121
|
|
|
|
|
211
|
|
|
|
|
(10,478
|
)
|
|
|
|
325
|
|
|
|
|
118,437
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share - diluted
|
|
|
|
$
|
1.57
|
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
|
$
|
(0.13
|
)
|
|
|
$
|
—
|
|
|
|
$
|
1.45
|
(e)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
|
|
Costs related to the Fragrance Ingredients Rationalization.
|
|
|
|
|
|
|
|
|
|
|
|
(b)
|
|
|
Related to a partial plant closing in Asia.
|
|
|
|
|
|
|
|
|
|
|
|
|
(c)
|
|
|
Settlements due to favorable tax rulings in jurisdictions for
which reserves were previously recorded for ongoing tax
disputes.
|
|
|
(d)
|
|
|
Related to the acquisition of Henry H. Ottens Manufacturing Co.,
Inc. Ottens Flavors.
|
|
|
|
|
|
|
(e)
|
|
|
The sum of these items do not foot due to rounding.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter 2014
|
|
|
|
|
|
Items Impacting Comparability
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported (GAAP)
|
|
Restructuring and Other Charges
|
|
Operational Improvement Initiative Costs
|
|
Adjusted (Non- GAAP)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales
|
|
|
|
|
770,224
|
|
|
|
|
|
|
|
|
|
|
Cost of Goods Sold
|
|
|
|
|
428,812
|
|
|
|
(2,250
|
)
|
(a)
|
|
|
(369
|
)
|
(b)
|
|
|
|
Gross Profit
|
|
|
|
|
341,412
|
|
|
|
2,250
|
|
|
|
|
369
|
|
|
|
|
344,031
|
|
Research and Development
|
|
|
|
61,504
|
|
|
|
|
|
|
|
|
|
|
Selling and Administrative
|
|
|
|
|
123,733
|
|
|
|
|
|
|
|
|
|
|
RSA Expense
|
|
|
|
|
185,237
|
|
|
|
|
|
|
|
|
|
|
Restructuring and other charges, net
|
|
|
|
122
|
|
|
|
(122
|
)
|
|
|
|
|
|
|
|
Operating Profit
|
|
|
|
|
156,053
|
|
|
|
2,372
|
|
|
|
|
369
|
|
|
|
|
158,794
|
|
Interest Expense
|
|
|
|
|
11,677
|
|
|
|
|
|
|
|
|
|
|
Other Income, net
|
|
|
|
|
1,443
|
|
|
|
|
|
|
|
|
|
|
Income before taxes
|
|
|
|
|
142,933
|
|
|
|
2,372
|
|
|
|
|
369
|
|
|
|
|
|
Taxes on Income
|
|
|
|
|
36,226
|
|
|
|
831
|
|
|
|
|
90
|
|
|
|
|
37,147
|
|
Net Income
|
|
|
|
|
106,707
|
|
|
|
1,541
|
|
|
|
|
279
|
|
|
|
|
108,527
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share - diluted
|
|
|
|
$
|
1.30
|
|
|
$
|
0.02
|
|
|
|
$
|
—
|
|
|
|
$
|
1.32
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
|
|
Costs related to the Fragrance Ingredients Rationalization.
|
|
|
|
|
(b)
|
|
|
Related to plant closing in Europe and partial closing in Asia.
|
|
|
CONTACT:
International Flavors & Fragrances Inc.
VP, Global
Corporate Communications & Investor Relations:
Michael DeVeau,
212-708-7164
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