WISCONSIN
|
1-7626
|
39-0561070
|
(State or other jurisdiction of incorporation)
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(Commission File Number)
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(IRS Employer Identification No.)
|
☐ |
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)
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☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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ITEM 2.02 |
RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
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ITEM 9.01 |
FINANCIAL STATEMENTS AND EXHIBITS.
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Exhibit 99.1: |
Sensient Technologies Corporation Earnings Press Release for the Quarter and Nine Months Ended September 30, 2018.
|
SENSIENT TECHNOLOGIES CORPORATION
(Registrant)
|
|||
By:
|
/s/ John J. Manning
|
||
Name:
|
John J. Manning
|
||
Title:
|
Vice President, General Counsel and Secretary
|
||
Date:
|
October 19, 2018
|
Sensient Technologies Corporation Earnings Press Release for the Quarter and Nine Months Ended September 30, 2018.
|
Contact:
|
Kim Chase
|
(414) 347-3706
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Sensient Technologies Corporation |
Page 2 |
Earnings Release – Quarter Ended September 30, 2018 |
|
October 19, 2018 |
|
Sensient Technologies Corporation |
Page 3 |
Earnings Release – Quarter Ended September 30, 2018 |
|
October 19, 2018 |
|
Reported
|
||||||||
Revenue
|
Quarter
|
Year-to-Date
|
||||||
Flavors & Fragrances
|
(5.9
|
%)
|
0.5
|
%
|
||||
Color
|
1.3
|
%
|
6.6
|
%
|
||||
Asia Pacific
|
(4.4
|
%)
|
0.8
|
%
|
||||
Total Revenue
|
(3.1
|
%)
|
2.8
|
%
|
||||
Local Currency (1)
|
||||||||
Revenue
|
Quarter
|
Year-to-Date
|
||||||
Flavors & Fragrances
|
(5.3
|
%)
|
(1.2
|
%)
|
||||
Color
|
4.1
|
%
|
5.1
|
%
|
||||
Asia Pacific
|
(1.5
|
%)
|
0.0
|
%
|
||||
Total Revenue
|
(1.4
|
%)
|
1.2
|
%
|
||||
|
(1)
|
Local currency percentage changes are described in more detail in the Reconciliation of Non-GAAP amounts below.
|
Sensient Technologies Corporation |
Page 4 |
Earnings Release – Quarter Ended September 30, 2018 |
|
October 19, 2018 |
|
Sensient Technologies Corporation |
Page 5 |
Earnings Release – Quarter Ended September 30, 2018 |
|
October 19, 2018 |
|
Sensient Technologies Corporation |
Page 6 |
Earnings Release – Quarter Ended September 30, 2018 |
|
October 19, 2018 |
|
Sensient Technologies Corporation |
Page 7 |
Earnings Release – Quarter Ended September 30, 2018 |
|
October 19, 2018 |
|
Sensient Technologies Corporation
|
Page 8
|
(In thousands, except percentages and per share amounts)
|
|
(Unaudited)
|
Consolidated Statements of Earnings
|
Three Months Ended September 30
|
Nine Months Ended September 30
|
||||||||||||||||||||||
2018
|
2017
|
% Change
|
2018
|
2017
|
% Change
|
|||||||||||||||||||
Revenue
|
$
|
342,734
|
$
|
353,519
|
-3.1
|
%
|
$
|
1,062,252
|
$
|
1,033,391
|
2.8
|
%
|
||||||||||||
Cost of products sold
|
227,161
|
230,784
|
-1.6
|
%
|
702,138
|
670,486
|
4.7
|
%
|
||||||||||||||||
Selling and administrative expenses
|
65,309
|
70,725
|
-7.7
|
%
|
201,988
|
242,478
|
-16.7
|
%
|
||||||||||||||||
Operating income
|
50,264
|
52,010
|
-3.4
|
%
|
158,126
|
120,427
|
31.3
|
%
|
||||||||||||||||
Interest expense
|
5,407
|
4,946
|
16,517
|
14,474
|
||||||||||||||||||||
Earnings before income taxes
|
44,857
|
47,064
|
141,609
|
105,953
|
||||||||||||||||||||
Income taxes
|
(2,336
|
)
|
14,851
|
17,099
|
29,774
|
|||||||||||||||||||
Net earnings
|
$
|
47,193
|
$
|
32,213
|
46.5
|
%
|
$
|
124,510
|
$
|
76,179
|
63.4
|
%
|
||||||||||||
Earnings per share of common stock:
|
||||||||||||||||||||||||
Basic
|
$
|
1.12
|
$
|
0.74
|
$
|
2.93
|
$
|
1.73
|
||||||||||||||||
Diluted
|
$
|
1.12
|
$
|
0.73
|
$
|
2.92
|
$
|
1.72
|
||||||||||||||||
Average common shares outstanding:
|
||||||||||||||||||||||||
Basic
|
42,240
|
43,624
|
42,464
|
43,947
|
||||||||||||||||||||
Diluted
|
42,313
|
43,864
|
42,571
|
44,209
|
Three Months Ended September 30
|
Nine Months Ended September 30
|
|||||||||||||||||||||||
|
2018
|
2017
|
% Change
|
2018
|
2017
|
% Change
|
||||||||||||||||||
Operating income (GAAP)
|
$
|
50,264
|
$
|
52,010
|
-3.4
|
%
|
$
|
158,126
|
$
|
120,427
|
31.3
|
%
|
||||||||||||
Restructuring - Cost of products sold
|
-
|
3,073
|
-
|
3,415
|
||||||||||||||||||||
Restructuring - Selling and administrative
|
-
|
2,927
|
-
|
30,212
|
||||||||||||||||||||
Other - Selling and administrative
|
-
|
14
|
-
|
11,555
|
||||||||||||||||||||
Adjusted operating income
|
$
|
50,264
|
$
|
58,024
|
-13.4
|
%
|
$
|
158,126
|
$
|
165,609
|
-4.5
|
%
|
||||||||||||
Net earnings (GAAP)
|
$
|
47,193
|
$
|
32,213
|
46.5
|
%
|
$
|
124,510
|
$
|
76,179
|
63.4
|
%
|
||||||||||||
Restructuring and other, before tax
|
-
|
6,014
|
-
|
45,182
|
||||||||||||||||||||
Tax impact of restructuring and other
|
-
|
681
|
-
|
(7,424
|
)
|
|||||||||||||||||||
Impact of the 2017 Tax Legislation
|
(7,061
|
)
|
-
|
(7,061
|
)
|
-
|
||||||||||||||||||
Adjusted net earnings
|
$
|
40,132
|
$
|
38,908
|
3.1
|
%
|
$
|
117,449
|
$
|
113,937
|
3.1
|
%
|
||||||||||||
Diluted EPS (GAAP)
|
$
|
1.12
|
$
|
0.73
|
53.4
|
%
|
$
|
2.92
|
$
|
1.72
|
69.8
|
%
|
||||||||||||
Restructuring and other, net of tax
|
-
|
0.15
|
-
|
0.85
|
||||||||||||||||||||
2017 Tax Legislation
|
(0.17
|
)
|
-
|
(0.17
|
)
|
-
|
||||||||||||||||||
Adjusted diluted EPS
|
$
|
0.95
|
$
|
0.89
|
6.7
|
%
|
$
|
2.76
|
$
|
2.58
|
7.0
|
%
|
Sensient Technologies Corporation
|
Page 9
|
(In thousands, except per share amounts)
|
|
(Unaudited)
|
Three Months Ended September 30, 2018
|
Nine Months Ended September 30, 2018
|
|||||||||||||||||||||||
Revenue
|
Total
|
Foreign
Exchange
Rates
|
Local
Currency
|
Total
|
Foreign
Exchange
Rates
|
Local
Currency
|
||||||||||||||||||
Flavors & Fragrances
|
(5.9
|
%)
|
(0.6
|
%)
|
(5.3
|
%)
|
0.5
|
%
|
1.8
|
%
|
(1.2
|
%)
|
||||||||||||
Color
|
1.3
|
%
|
(2.8
|
%)
|
4.1
|
%
|
6.6
|
%
|
1.5
|
%
|
5.1
|
%
|
||||||||||||
Asia Pacific
|
(4.4
|
%)
|
(2.9
|
%)
|
(1.5
|
%)
|
0.8
|
%
|
0.8
|
%
|
0.0
|
%
|
||||||||||||
Total Revenue
|
(3.1
|
%)
|
(1.7
|
%)
|
(1.4
|
%)
|
2.8
|
%
|
1.6
|
%
|
1.2
|
%
|
Results by Segment
|
Three Months Ended September 30
|
Nine Months Ended September 30
|
||||||||||||||||||||||
Revenue
|
2018
|
2017
|
% Change
|
2018
|
2017
|
% Change
|
||||||||||||||||||
Flavors & Fragrances
|
$
|
184,397
|
$
|
195,992
|
-5.9
|
%
|
$
|
571,401
|
$
|
568,423
|
0.5
|
%
|
||||||||||||
Color
|
134,961
|
133,223
|
1.3
|
%
|
426,412
|
400,183
|
6.6
|
%
|
||||||||||||||||
Asia Pacific
|
31,275
|
32,708
|
-4.4
|
%
|
92,063
|
91,289
|
0.8
|
%
|
||||||||||||||||
Corporate & Other
|
169
|
-
|
169
|
- | ||||||||||||||||||||
Intersegment elimination
|
(8,068
|
)
|
(8,404
|
)
|
(27,793
|
)
|
(26,504
|
)
|
||||||||||||||||
Consolidated
|
$
|
342,734
|
$
|
353,519
|
-3.1
|
%
|
$
|
1,062,252
|
$
|
1,033,391
|
2.8
|
%
|
||||||||||||
Operating Income
|
||||||||||||||||||||||||
Flavors & Fragrances
|
$
|
24,814
|
$
|
33,006
|
-24.8
|
%
|
$
|
74,142
|
$
|
90,278
|
-17.9
|
%
|
||||||||||||
Color
|
27,269
|
28,624
|
-4.7
|
%
|
92,074
|
87,913
|
4.7
|
%
|
||||||||||||||||
Asia Pacific
|
5,750
|
5,780
|
-0.5
|
%
|
15,256
|
14,750
|
3.4
|
%
|
||||||||||||||||
Corporate & Other
|
(7,569
|
)
|
(15,400
|
)
|
(23,346
|
)
|
(72,514
|
)
|
||||||||||||||||
Consolidated
|
$
|
50,264
|
$
|
52,010
|
-3.4
|
%
|
$
|
158,126
|
$
|
120,427
|
31.3
|
%
|
Sensient Technologies Corporation
|
Page 10
|
(In thousands, except per share amounts)
|
|
(Unaudited)
|
Consolidated Condensed Balance Sheets
|
||||||||
September 30
|
2018
|
2017
|
||||||
Cash and cash equivalents
|
$
|
36,760
|
$
|
24,654
|
||||
Trade accounts receivable, net
|
271,268
|
222,552
|
||||||
Inventories
|
484,811
|
456,480
|
||||||
Other current assets
|
40,152
|
43,245
|
||||||
Assets Held for Sale
|
1,903
|
7,396
|
||||||
Total Current Assets
|
834,894
|
754,327
|
||||||
Goodwill & intangible assets (net)
|
435,796
|
414,785
|
||||||
Property, plant, and equipment (net)
|
492,171
|
484,761
|
||||||
Other assets
|
78,046
|
84,992
|
||||||
Total Assets
|
$
|
1,840,907
|
$
|
1,738,865
|
||||
Trade accounts payable
|
$
|
97,027
|
$
|
101,104
|
||||
Short-term debt
|
20,096
|
20,092
|
||||||
Other current liabilities
|
77,051
|
89,015
|
||||||
Total Current Liabilities
|
194,174
|
210,211
|
||||||
Long-term debt
|
746,012
|
607,395
|
||||||
Accrued employee and retiree benefits
|
22,094
|
21,283
|
||||||
Other liabilities
|
32,458
|
20,444
|
||||||
Shareholders’ Equity
|
846,169
|
879,532
|
||||||
Total Liabilities and Shareholders’ Equity
|
$
|
1,840,907
|
$
|
1,738,865
|
Consolidated Statements of Cash Flows
|
||||||||
Nine Months Ended September 30
|
2018
|
2017
|
||||||
Cash flows from operating activities:
|
||||||||
Net earnings
|
$
|
124,510
|
$
|
76,179
|
||||
Adjustments to arrive at net cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
39,057
|
36,626
|
||||||
Stock-based compensation
|
1,541
|
6,296
|
||||||
Net loss on assets
|
311
|
1,371
|
||||||
Loss on divestiture of businesses
|
-
|
33,160
|
||||||
Deferred income taxes
|
3,152
|
(9,087
|
)
|
|||||
Changes in operating assets and liabilities
|
(159,711
|
)
|
(122,386
|
)
|
||||
Net cash provided by operating activities
|
8,860
|
22,159
|
||||||
Cash flows from investing activities:
|
||||||||
Acquisition of property, plant and equipment
|
(34,090
|
)
|
(32,825
|
)
|
||||
Cash receipts on sold receivables
|
91,142
|
86,229
|
||||||
Proceeds from sale of assets
|
283
|
5,444
|
||||||
Proceeds from divestiture of businesses
|
-
|
12,457
|
||||||
Acquisition of new businesses
|
(31,100
|
)
|
-
|
|||||
Other investing activity
|
616
|
2,396
|
||||||
Net cash provided by investing activities
|
26,851
|
73,701
|
||||||
Cash flows from financing activities:
|
||||||||
Proceeds from additional borrowings
|
248,426
|
188,387
|
||||||
Debt payments
|
(158,214
|
)
|
(190,164
|
)
|
||||
Purchase of treasury stock
|
(76,734
|
)
|
(64,486
|
)
|
||||
Dividends paid
|
(42,195
|
)
|
(39,696
|
)
|
||||
Other financing activity
|
(2,777
|
)
|
(988
|
)
|
||||
Net cash used in financing activities
|
(31,494
|
)
|
(106,947
|
)
|
||||
Effect of exchange rate changes on cash and cash equivalents
|
3,199
|
9,876
|
||||||
Net increase (decrease) in cash and cash equivalents
|
7,416
|
(1,211
|
)
|
|||||
Cash and cash equivalents at beginning of period
|
29,344
|
25,865
|
||||||
Cash and cash equivalents at end of period
|
$
|
36,760
|
$
|
24,654
|
Supplemental Information
|
||||||||
Nine Months Ended September 30,
|
2018
|
2017
|
||||||
Dividends paid per share
|
$
|
0.99
|
$
|
0.90
|