NYSE$IFF

International Flavors & Fragra · Q4 2019 earnings

Q4 2019 earnings · · Investor relations

Briefing

IFF reported a 5% increase in sales and an EPS of $0.70 for the fourth quarter of 2019.

IFF reported a 5% increase in net sales to $1.28 billion for the fourth quarter of 2019. Reported EPS was $0.70, while adjusted EPS ex amortization was $1.46. The company continued to achieve significant cost synergies from Frutarom and captured solid year one revenue synergies.

  • Delivered high-single digit currency neutral top-line growth.
  • Achieved a robust double-digit increase in adjusted EPS ex amortization.
  • Continued to achieve significant cost synergies from Frutarom well ahead of year-one targets.
  • Captured solid year one revenue synergies, demonstrating broad operational strength.

Headline financials

Total Revenue

$1.28B

Previous: $1.22B+5.3%
EPS (adj)

$1.46

Previous: $1.22+19.7%
Operating EBITDA Margin

9.0%

No prior period
Capital Expenditures

$75.5M

Previous: $67.7M+11.6%
Free Cash Flow

$240M

Previous: $168M+43.1%
Net Income

$80.4M

Previous: $13M+517.3%
Operating Income

$117M

Previous: $95.3M+22.6%
Gross Profit

$502M

Previous: $478M+5.2%
Cash & Equivalents

$624M

Previous: $635M-1.7%
Total Assets

$13.3B

Previous: $12.9B+3.5%
Stock-Based Comp

$8.06M

Previous: $7.36M+9.5%

Revenue & EPS history

IFF · Revenue · Quarterly

$1.28B

Q4 2019+5.3%vs Q4 2018
Beat estimate in 14 of 16 quarters(88%)
ActualEstimate

Revenue by segment

IFF · $908M total across 2 segments · Q4 2019

  • Scent
    $478M
  • Taste
    $430M

Forward guidance

The Company's 2020 guidance is as follows: Sales $5.15B - $5.35B, Adjusted EPS $4.89 - $5.14 and Adjusted EPS Ex Amortization $6.20 - $6.45.

Tailwinds

  • Sales growth for 2020 is expected to be approximately 1% to 5% on a currency neutral basis.
  • Excluding the impacts of the 53rd week in the prior year period and an anticipated 0.5 percentage point impact, principally related to the carryover effect from the Russia/Ukraine compliance issue and CitraSource, currency neutral core sales growth is expected to be approximately 2.5% to 6.5%.
  • Adjusted EPS ex amortization growth for 2020 is expected to be approximately 3.5% to 7.5% on a currency neutral basis.
  • Offsetting the negative impacts is a 6 percentage point contribution from integration synergies.
  • The Company expects to achieve a Net Debt to EBITDA ratio of less than 3.0x by the end of 2020.

Headwinds

  • Currency is expected to negatively impact sales by an estimated 1 percentage point, and adjusted EPS ex amortization by 3 percentage points.
  • Sales growth for 2020 includes an estimated 1 percentage point impact related to the 53rd week in the prior year period and an anticipated 0.5 percentage point impact, principally related to the carryover effect from the Russia/Ukraine compliance issue and CitraSource.
  • Adjusted EPS ex amortization growth for 2020 includes an estimated 5 percentage point impact related to an incentive compensation reset, an estimated 1 percentage point impact related to the 53rd week in the prior year period and an anticipated 0.5 percentage point impact, principally related to the carryover effect from the Russia/Ukraine compliance issue and CitraSource.
  • The Company expects a modest impact from the recent coronavirus outbreak in Asia, based on its knowledge at this time.
  • There are still too many variables and uncertainties regarding this outbreak to quantify currently.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2019

Historical avgQ4 2019

-0.6%

Avg return

Earnings day

-1.0%

Avg return

5 days after

-1.3%

Avg return

30 days after

56%

38 / 68 earnings

Positive

+11.0%

Q1 2026

Best reaction

-19.5%

Q2 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+11.0%+10.4%+3.4%
Q4 2025+5.9%+7.5%-9.6%
Q3 2025+4.0%+2.1%+9.3%
Q1 2025-7.0%-3.6%-2.9%
Q4 2024-5.2%-7.9%-10.0%
Q3 2024-11.5%-6.8%-10.1%
Q2 2024-0.4%+1.7%+8.5%
Q1 2024+8.9%+12.2%+13.2%
Q4 2023-5.4%-0.9%+2.6%
Q3 2023-1.5%-1.3%+4.1%
Q2 2023-19.5%-20.2%-11.8%
Q1 2023-6.4%-13.8%-15.8%
Q4 2022-19.1%-0.0%-4.7%
Q3 2022-3.6%+6.0%+14.0%
Q2 2022-5.2%-1.9%-10.7%
Q1 2022+2.7%+8.2%+8.8%
Q4 2021+5.8%+2.1%-8.4%
Q3 2021+6.6%+6.3%+3.2%
Q2 2021+2.2%+5.8%+2.1%
Q1 2021-5.3%-3.6%+0.4%
Q4 2020+6.9%+4.8%+5.4%
Q3 2020+3.6%+3.3%+6.1%
Q2 2020-1.2%-2.9%-3.8%
Q1 2020-0.8%-4.6%-0.7%
Q4 2019-0.9%-1.5%-21.0%
Q3 2019+10.4%+9.1%+15.0%
Q2 2019-17.3%-14.8%-22.2%
Q1 2019-3.5%-2.7%+0.9%
Q4 2018-9.1%-9.5%-14.6%
Q3 2018+1.9%-0.1%-5.3%
Q2 2018+0.1%-1.3%-3.1%
Q1 2018-11.0%-10.2%-11.6%
Q4 2017+0.7%-0.9%-3.0%
Q3 2017+1.1%-1.0%+3.7%
Q2 2017+3.6%+0.4%+4.3%
Q1 2017-7.4%-6.1%-1.0%
Q4 2016+5.2%+3.8%+12.0%
Q3 2016-2.0%-8.0%-3.1%
Q2 2016+1.8%+1.2%+4.0%
Q1 2016+6.5%
Q4 2015-14.0%
Q3 2015+0.4%
Q2 2015-1.9%
Q1 2015-5.5%
Q4 2014+9.3%
Q3 2014-0.7%
Q2 2014-3.8%
Q1 2014+2.2%
Q4 2013+4.1%
Q3 2013+3.8%
Q2 2013+0.5%
Q1 2013+2.0%
Q4 2012+3.4%
Q3 2012-3.0%
Q2 2012+8.0%
Q1 2012-1.8%
Q4 2011-1.0%
Q3 2011-12.2%
Q2 2011+0.9%
Q1 2010+1.8%
Q1 2011+0.9%
Q4 2010+1.8%
Q3 2010+4.9%
Q3 2009+4.9%
Q2 2009+2.1%
Q4 2009+2.1%
Q4 2008+2.1%
Q2 2010+2.1%

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