Segment Information

9 Months Ended

Sep. 30, 2020

Segment Information [Abstract]

Segment Information

7. Segment Information

During the third quarter of 2020, the Company changed the name of its Flavors & Fragrances segment to the Flavors & Extracts segment in order to more accurately reflect the group’s product portfolio. In addition, the Company changed the name of its Food & Beverage Colors product line to Food & Pharmaceutical Colors.

Operating results by segment for the periods presented are as follows:

(In thousands)	Flavors & Extracts		Color		Asia Pacific		Corporate & Other			Consolidated
Three months ended September 30, 2020:
Revenue from external customers	$	179,687	$	113,139	$	30,740	$	-		$	323,566
Intersegment revenue		3,179		3,275		-		-			6,454
Total revenue	$	182,866	$	116,414	$	30,740	$	-		$	330,020
Operating income (loss)	$	23,844	$	23,559	$	6,123	$	(12,371	)	$	41,155
Interest expense		-		-		-		3,497			3,497
Earnings (loss) before income taxes	$	23,844	$	23,559	$	6,123	$	(15,868	)	$	37,658
Three months ended September 30, 2019:
Revenue from external customers	$	163,870	$	123,710	$	30,070	$	-		$	317,650
Intersegment revenue		3,707		3,295		55		-			7,057
Total revenue	$	167,577	$	127,005	$	30,125	$	-		$	324,707
Operating income (loss)	$	17,600	$	23,436	$	5,406	$	(7,654	)	$	38,788
Interest expense		-		-		-		4,936			4,936
Earnings (loss) before income taxes	$	17,600	$	23,436	$	5,406	$	(12,590	)	$	33,852

(In thousands)	Flavors & Extracts		Color		Asia Pacific		Corporate & Other			Consolidated
Nine months ended September 30, 2020:
Revenue from external customers	$	539,304	$	369,211	$	88,818	$	-		$	997,333
Intersegment revenue		13,671		11,994		244		-			25,909
Total revenue	$	552,975	$	381,205	$	89,062	$	-		$	1,023,242
Operating income (loss)	$	67,467	$	75,486	$	16,031	$	(41,143	)	$	117,841
Interest expense		-		-		-		11,412			11,412
Earnings (loss) before income taxes	$	67,467	$	75,486	$	16,031	$	(52,555	)	$	106,429
Nine months ended September 30, 2019:
Revenue from external customers	$	517,148	$	399,610	$	87,591	$	-		$	1,004,349
Intersegment revenue		14,116		10,186		55		-			24,357
Total revenue	$	531,264	$	409,796	$	87,646	$	-		$	1,028,706
Operating income (loss)	$	60,775	$	81,512	$	13,825	$	(20,536	)	$	135,576
Interest expense		-		-		-		15,538			15,538
Earnings (loss) before income taxes	$	60,775	$	81,512	$	13,825	$	(36,074	)	$	120,038

The Company evaluates performance based on operating income before divestiture and other related costs, restructuring and other charges including operational improvement plan costs, interest expense, and income taxes (segment operating income). Total revenue and segment operating income by business segment and geographic region include both sales to customers, as reported in the Company’s Consolidated Condensed Statements of Earnings, and intersegment sales, which are accounted for at prices that approximate market prices and are eliminated in consolidation.

The 2020 divestiture and other related costs, which pertain to the divestitures of the Company’s inks and yogurt fruit preparations product lines, and the anticipated divestiture of the Company’s fragrances product line (excluding its essential oils product line), and the operational improvement plan, are reported in Corporate & Other. There were no divestiture and other related costs, restructuring and other costs, or operational improvement plan costs, in the first nine months of 2019.

In addition to evaluating the Company’s performance based on the segments above, revenue is also disaggregated and analyzed by product line and geographic market. The following tables display the Company’s revenue by these major sources.

During the first quarter of 2020, the Company updated its product line disclosures as a result of its intent to divest its inks, fragrances (excluding its essential oils product line), and yogurt fruit preparations product lines. Flavors, Extracts & Flavor Ingredients now includes essential oils, which was previously reported in Fragrances. Fragrances now only includes the aroma chemicals and fragrance compounds product lines. Yogurt Fruit Preparations is now disclosed separately; previously it was reported in the Flavors product line. Food & Pharmaceutical Colors (formerly Food & Beverage Colors) now includes pharmaceutical colors and natural extraction, which were previously reported in Other Colors. Personal Care includes cosmetic and non-food colors. Inks is now disclosed separately; previously it was reported in Other Colors. The results for 2019 have been restated to reflect these changes.

Product Lines

(In thousands)	Flavors & Extracts			Color			Asia Pacific			Consolidated
Three months ended September 30, 2020:
Flavors, Extracts & Flavor Ingredients	$	98,952		$	-		$	-		$	98,952
Natural Ingredients		60,937			-			-			60,937
Fragrances		19,890			-			-			19,890
Yogurt Fruit Preparations		3,087			-			-			3,087
Food & Pharmaceutical Colors		-			83,406			-			83,406
Personal Care		-			32,495			-			32,495
Inks		-			513			-			513
Asia Pacific		-			-			30,740			30,740
Intersegment Revenue		(3,179	)		(3,275	)		-			(6,454	)
Total revenue from external customers	$	179,687		$	113,139		$	30,740		$	323,566
Three months ended September 30, 2019:
Flavors, Extracts & Flavor Ingredients	$	88,404		$	-		$	-		$	88,404
Natural Ingredients		53,220			-			-			53,220
Fragrances		21,395			-			-			21,395
Yogurt Fruit Preparations		4,558			-			-			4,558
Food & Pharmaceutical Colors		-			81,805			-			81,805
Personal Care		-			37,276			-			37,276
Inks		-			7,924			-			7,924
Asia Pacific		-			-			30,125			30,125
Intersegment Revenue		(3,707	)		(3,295	)		(55	)		(7,057	)
Total revenue from external customers	$	163,870		$	123,710		$	30,070		$	317,650

(In thousands)	Flavors & Extracts			Color			Asia Pacific			Consolidated
Nine months ended September 30, 2020:
Flavors, Extracts & Flavor Ingredients	$	302,047		$	-		$	-		$	302,047
Natural Ingredients		175,764			-			-			175,764
Fragrances		63,251			-			-			63,251
Yogurt Fruit Preparations		11,913			-			-			11,913
Food & Pharmaceutical Colors		-			261,024			-			261,024
Personal Care		-			107,333			-			107,333
Inks		-			12,848			-			12,848
Asia Pacific		-			-			89,062			89,062
Intersegment Revenue		(13,671	)		(11,994	)		(244	)		(25,909	)
Total revenue from external customers	$	539,304		$	369,211		$	88,818		$	997,333
Nine months ended September 30, 2019:
Flavors, Extracts & Flavor Ingredients	$	292,347		$	-		$	-		$	292,347
Natural Ingredients		156,864			-			-			156,864
Fragrances		65,828			-			-			65,828
Yogurt Fruit Preparations		16,225			-			-			16,225
Food & Pharmaceutical Colors		-			259,249			-			259,249
Personal Care		-			123,595			-			123,595
Inks		-			26,952			-			26,952
Asia Pacific		-			-			87,646			87,646
Intersegment Revenue		(14,116	)		(10,186	)		(55	)		(24,357	)
Total revenue from external customers	$	517,148		$	399,610		$	87,591		$	1,004,349

Geographic Markets

(In thousands)	Flavors & Extracts		Color		Asia Pacific		Consolidated
Three months ended September 30, 2020:
North America	$	124,125	$	61,937	$	48	$	186,110
Europe		37,257		24,953		11		62,221
Asia Pacific		7,905		10,926		29,489		48,320
Other		10,400		15,323		1,192		26,915
Total revenue from external customers	$	179,687	$	113,139	$	30,740	$	323,566
Three months ended September 30, 2019:
North America	$	109,659	$	60,801	$	25	$	170,485
Europe		35,964		33,027		132		69,123
Asia Pacific		7,002		12,903		29,731		49,636
Other		11,245		16,979		182		28,406
Total revenue from external customers	$	163,870	$	123,710	$	30,070	$	317,650

(In thousands)	Flavors & Extracts		Color		Asia Pacific		Consolidated
Nine months ended September 30, 2020:
North America	$	361,653	$	189,572	$	48	$	551,273
Europe		120,406		88,941		78		209,425
Asia Pacific		25,363		43,096		85,746		154,205
Other		31,882		47,602		2,946		82,430
Total revenue from external customers	$	539,304	$	369,211	$	88,818	$	997,333
Nine months ended September 30, 2019:
North America	$	335,521	$	192,109	$	87	$	527,717
Europe		125,288		113,844		280		239,412
Asia Pacific		24,041		44,440		86,719		155,200
Other		32,298		49,217		505		82,020
Total revenue from external customers	$	517,148	$	399,610	$	87,591	$	1,004,349