EX-99.1 2 c25784exv99w1.htm PRESS RELEASE exv99w1
 

Exhibit 99.1
FOR IMMEDIATE RELEASE
     
Contact:
  Dick Hobbs
 
  (414) 347-3836
Sensient Technologies Corporation
Reports Earnings for the Quarter Ended March 31, 2008
Pre-tax Earnings Up 24.4%
Earnings per Share Increase 16.2%
     MILWAUKEE—April 21, 2008—Sensient Technologies Corporation (NYSE: SXT) reported that diluted earnings per share for the first quarter of 2008 rose 16.2% to 43 cents, compared to 37 cents in the prior year’s comparable period. Revenue reached a record level of $307.4 million, up 7.8% from the first quarter of 2007. Foreign currency translation had a favorable impact on revenue of 6% in the quarter. First quarter 2008 operating income increased 15.8% on higher sales and improved margins.
     Cash provided by operating activities in the first quarter rose to $9.7 million, compared to $5.1 million in the prior year’s comparable period.
     “For the first quarter, we reported record revenue and our ninth consecutive quarter of strong earnings growth,” said Kenneth P. Manning, Chairman and CEO of Sensient Technologies Corporation. “We see favorable pricing and growth in several key product lines, and we expect our strong performance to continue throughout the year.”
BUSINESS REVIEW
     The Flavors & Fragrances Group reported record first quarter revenue and operating income. Revenue for the quarter increased 8.1% to $195.2 million, compared to $180.5 million in last year’s comparable period. Quarterly operating income was up 13.2% to $28.8 million, compared to $25.4 million in the first quarter of 2007. Group revenue in the quarter benefited from favorable foreign currency translation and improved pricing. Quarterly
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Sensient Technologies Corporation
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Earnings Release — First Quarter Ended March 31, 2008
    
April 21, 2008
    
operating income rose on the higher sales and on continued improvements in the profitability of the group’s European operations. Group operating margins improved 70 basis points to 14.8%.
     The Color Group’s first quarter revenue reached an all-time record level of $102.8 million, an increase of 6.8%, compared to $96.2 million in last year’s comparable period. Operating income for the quarter was up 8.1% to $18.5 million, compared to $17.1 million reported in the first quarter of 2007. Color Group revenue in the quarter reflects favorable foreign currency translation and improved pricing. Quarterly operating income rose as a result of the higher sales and improved product mix. Group operating margins improved 20 basis points to 18.0%.
2008 OUTLOOK
     Sensient has increased its 2008 diluted earnings per share guidance to be within a range of $1.77 to $1.80. The previous range for guidance had been between $1.74 and $1.78.
CONFERENCE CALL
     The company will host a conference call to discuss its 2008 first quarter financial results at 10:00 a.m. CDT on Monday, April 21, 2008. To make a reservation for the conference call, please contact InterCall Teleconferencing at (706) 645-6973 and refer to the Sensient Technologies Corporation conference call.
     A replay will be available beginning at 1:00 p.m. CDT on April 21, 2008, through midnight on April 28, 2008, by calling (706) 645-9291 and referring to conference identification number 42992654. A transcript of the call will also be posted on the company’s web site at www.sensient-tech.com after the call concludes.
     This release contains forward-looking statements (as that term is defined in the Private Securities Litigation Reform Act of 1995) that reflect management’s current assumptions and estimates of future economic circumstances, industry conditions, company performance and financial results. A variety of factors could cause the company’s actual results and experience to differ materially from the anticipated results, including, but not limited to the
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Sensient Technologies Corporation
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Earnings Release — First Quarter Ended March 31, 2008
    
April 21, 2008
    
factors noted in this press release and in the Risk Factors and Management’s Discussion and Analysis sections in our most recently filed annual report on Form 10-K for the year ended December 31, 2007. The forward-looking statements in this press release speak only as to the date of this release. Sensient Technologies Corporation expressly disclaims any obligation or undertaking to release publicly any updates or revisions to such statements to reflect any change in its expectations upon which such statements are based.
ABOUT SENSIENT TECHNOLOGIES
     Sensient Technologies Corporation is a leading global manufacturer and marketer of colors, flavors and fragrances. Sensient employs advanced technologies at facilities around the world to develop specialty food and beverage systems, cosmetic and pharmaceutical systems, inkjet and specialty inks and colors, and other specialty chemicals. The company’s customers include major international manufacturers representing some of the world’s best-known brands. Sensient is headquartered in Milwaukee, Wisconsin.
     www.sensient-tech.com
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Sensient Technologies Corporation
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(In thousands, except percentages and per share amounts)
    
Consolidated Statements of Earnings
                         
    Three Months Ended March 31,  
    2008     2007     % Change  
Revenue
   $ 307,419     $ 285,268       7.8 %
 
                        
Cost of products sold
     211,777       199,120       6.4 %
Selling and administrative expenses
     56,009       51,936       7.8 %
 
                    
 
                        
Operating income
     39,633       34,212       15.8 %
Interest expense
     8,578       9,252          
 
                    
 
                        
Earnings before income taxes
     31,055       24,960       24.4 %
Income taxes
     10,378       7,614          
 
                    
 
                        
Net earnings
   $ 20,677     $ 17,346       19.2 %
 
                    
 
                        
Earnings per common share:
                        
Basic
   $ 0.44     $ 0.37       18.9 %
 
                    
 
                        
Diluted
   $ 0.43     $ 0.37       16.2 %
 
                    
 
                        
Average common shares outstanding:
                        
Basic
     47,299       46,402       1.9 %
 
                    
 
                        
Diluted
     47,806       46,909       1.9 %
 
                    
Results by Segment
                         
    Three Months Ended March 31,  
    2008     2007     % Change  
Revenue
                        
Flavors & Fragrances
   $ 195,203     $ 180,513       8.1 %
Color
     102,771       96,192       6.8 %
Corporate & Other *
     18,591       16,144       15.2 %
Intersegment elimination
     (9,146 )     (7,581 )     20.6 %
 
                    
 
                        
Consolidated
   $ 307,419     $ 285,268       7.8 %
 
                    
 
                        
Operating Income
                        
Flavors & Fragrances
   $ 28,795     $ 25,437       13.2 %
Color
     18,505       17,113       8.1 %
Corporate & Other *
     (7,667 )     (8,338 )     -8.0 %
 
                    
 
                        
Consolidated
   $ 39,633     $ 34,212       15.8 %
 
                    
 
*   Corporate & Other contains the Company’s Asia Pacific and China operations as well as certain unallocated corporate expenses. Prior to the first quarter of 2008, the results of the Company’s business in China were reported as part of the Flavors & Fragrances Group. Results for 2007 have been restated to reflect this change.
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Sensient Technologies Corporation
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(In thousands, except per share amounts)
    
Consolidated Condensed Balance Sheets
March 31,
                 
    2008     2007  
Current assets
   $ 649,502     $ 568,516  
Goodwill and intangibles (net)
     508,466       464,649  
Property, plant and equipment (net)
     430,138       387,419  
Other assets
     45,186       47,924  
 
            
 
                
Total Assets
   $ 1,633,292     $ 1,468,508  
 
            
 
                
Current liabilities
   $ 239,858     $ 251,698  
Long-term debt
     459,255       437,012  
Accrued employee and retiree benefits
     45,573       45,263  
Other liabilities
     28,131       16,921  
Shareholders’ equity
     860,475       717,614  
 
            
 
                
Total Liabilities and Shareholders’ Equity
   $ 1,633,292     $ 1,468,508  
 
            
Consolidated Statements of Cash Flows
Three Months Ended March 31,
                 
    2008     2007  
Net cash provided by operating activities
   $ 9,734     $ 5,095  
 
            
 
                
Cash flows from investing activities:
                
Acquisition of property, plant and equipment
     (12,113 )     (6,827 )
Proceeds from sale of assets
     23       1,418  
Other investing activity
     1,462       252  
 
            
 
                
Net cash used in investing activities
     (10,628 )     (5,157 )
 
            
 
                
Cash flows from financing activities:
                
Proceeds from additional borrowings
     9,052       24,679  
Debt payments
     (3,071 )     (19,744 )
Dividends paid
     (8,587 )     (7,481 )
Proceeds from options exercised and other
     5,478       2,514  
 
            
 
                
Net cash provided by (used in) financing activities
     2,872       (32 )
 
            
 
                
Effect of exchange rate changes on cash and cash equivalents
     308       (14 )
 
            
 
                
Net increase (decrease) in cash and cash equivalents
     2,286       (108 )
Cash and cash equivalents at beginning of period
     10,522       5,035  
 
            
Cash and cash equivalents at end of period
   $ 12,808     $ 4,927  
 
            
Supplemental Information
Three Months Ended March 31,
                 
    2008   2007
Depreciation and amortization
   $ 11,483     $ 11,201  
 
Dividends per share
   $ 0.18     $ 0.16