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Jun 30, 2023
IFF Q2 2023 Earnings Report
IFF's Q2 2023 financial results were reported, showing strong top- and bottom-line growth in Scent and Pharma Solutions, offset by demand softness in Functional Ingredients due to customer destocking.
Key Takeaways
IFF reported flat sales of $2.93 billion compared to the prior-year period, with a 4% decrease on a comparable currency-neutral basis. Growth in Scent and Pharma Solutions was offset by softness in Nourish and Health & Biosciences. Adjusted operating EBITDA was $510 million, impacted by lower volumes and a one-time inventory write-down. The company is focusing on portfolio optimization and operational improvements.
IFF reported net sales of $2.93 billion, flat versus the prior-year period.
Adjusted operating EBITDA for the second quarter was $510 million.
Reported earnings per share (EPS) for the second quarter was $0.11; adjusted EPS excluding amortization was $0.86 per diluted share.
IFF is launching a sale process for its Lucas Meyer Cosmetics business and exploring additional strategic pathways to maximize shareholder returns.
Revenue by Segment
Forward Guidance
The Company expects full year 2023 sales to be in the range of $11.3 billion to $11.6 billion and adjusted operating EBITDA to be in the range of $1.85 billion to $2.0 billion.
Positive Outlook
- The Company continues to expect a mid-single digit price increase for the full year 2023.
- IFF remains focused on achieving its targeted full-year working capital improvement.
- IFF continues to execute a series of strategic transformation initiatives and is taking additional actions to rapidly improve the performance of its Functional Ingredients business.
- IFF has been focused on maximizing the value of the portfolio along those parameters and has taken a range of proactive steps to position IFF for long-term success.
- The Functional Ingredients business is expected to have a strong improvement in 2024.
Challenges Ahead
- Full year 2023 sales are expected to be in the range of $11.3 billion to $11.6 billion versus approximately $12.3 billion previously, reflecting the Company's expectation that volumes in the second half of 2023 will not recover as previously expected, driven particularly by continued customer destocking.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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