Segment Information

9 Months Ended

Sep. 30, 2022

Segment Information [Abstract]

Segment Information

9. Segment Information

The Company evaluates performance based on operating income before divestiture & other related costs, share-based compensation, restructuring and other charges including the 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 Statements of Earnings, and intersegment sales, which are accounted for at prices that approximate market prices and are eliminated in consolidation.

The Company determines its operating segments based on information utilized by its chief operating decision maker to allocate resources and assess performance. The Company’s three reportable segments are the Flavors & Extracts and Color segments, which are both managed on a product line basis, and the Asia Pacific segment, which is managed on a geographic basis. The Company’s Flavors & Extracts segment produces flavor, extracts, and essential oils products that impart a desired taste, texture, aroma, and other characteristics to a broad range of consumer and other products. The Color segment produces natural and synthetic color systems for use in foods, beverages, pharmaceuticals, and nutraceuticals; colors and other ingredients for cosmetics, such as active ingredients, solubilizers, and surface treated pigments; pharmaceutical and nutraceutical excipients, such as colors, flavors, coatings, and nutraceutical ingredients; and technical colors for industrial applications. The Asia Pacific segment is managed on a geographic basis and produces and distributes color and flavor products for the Asia Pacific countries. The Company’s corporate expenses, divestiture & other related costs, share-based compensation, operational improvement plan expenses, and other costs are included in the “Corporate & Other” category.

Divestiture & other related costs and restructuring and other costs, including the Operational Improvement Plan costs, for the three and nine months ended September 30, 2021, are further described in Note 2, Divestitures, and Note 3, Operational Improvement Plan, and are included in the operating income (loss) results in Corporate & Other below. There were no divestiture & other related costs or Operational Improvement Plan costs for the three and nine months ended September 30, 2022. In addition, the Company’s corporate expenses and share-based compensation are included in Corporate & Other.

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, 2022:
Revenue from external customers	$	181,397	$	144,570	$	35,109	$	-		$	361,076
Intersegment revenue		5,649		6,899		112		-			12,660
Total revenue	$	187,046	$	151,469	$	35,221	$	-		$	373,736
Operating income (loss)	$	26,337	$	28,200	$	6,952	$	(13,996	)	$	47,493
Interest expense		-		-		-		3,672			3,672
Earnings (loss) before income taxes	$	26,337	$	28,200	$	6,952	$	(17,668	)	$	43,821
Three months ended September 30, 2021:
Revenue from external customers	$	175,690	$	135,395	$	33,202	$	-		$	344,287
Intersegment revenue		5,977		3,844		240		-			10,061
Total revenue	$	181,667	$	139,239	$	33,442	$	-		$	354,348
Operating income (loss)	$	25,164	$	27,253	$	6,601	$	(12,060	)	$	46,958
Interest expense		-		-		-		3,037			3,037
Earnings (loss) before income taxes	$	25,164	$	27,253	$	6,601	$	(15,097	)	$	43,921

(In thousands)	Flavors & Extracts		Color		Asia Pacific		Corporate & Other			Consolidated
Nine months ended September 30, 2022:
Revenue from external customers	$	539,014	$	440,568	$	108,721	$	-		$	1,088,303
Intersegment revenue		20,096		15,607		293		-			35,996
Total revenue	$	559,110	$	456,175	$	109,014	$	-		$	1,124,299
Operating income (loss)	$	83,929	$	90,035	$	22,877	$	(41,315	)	$	155,526
Interest expense		-		-		-		9,748			9,748
Earnings (loss) before income taxes	$	83,929	$	90,035	$	22,877	$	(51,063	)	$	145,778
Nine months ended September 30, 2021:
Revenue from external customers	$	545,050	$	395,426	$	99,340	$	-		$	1,039,816
Intersegment revenue		16,929		12,740		259		-			29,928
Total revenue	$	561,979	$	408,166	$	99,599	$	-		$	1,069,744
Operating income (loss)	$	76,718	$	79,462	$	19,146	$	(45,718	)	$	129,608
Interest expense		-		-		-		9,792			9,792
Earnings (loss) before income taxes	$	76,718	$	79,462	$	19,146	$	(55,510	)	$	119,816

Product Lines

(In thousands)	Flavors & Extracts			Color			Asia Pacific			Consolidated
Three months ended September 30, 2022:
Flavors, Extracts & Flavor Ingredients	$	123,945		$	-		$	-		$	123,945
Natural Ingredients		63,101			-			-			63,101
Food & Pharmaceutical Colors		-			111,194			-			111,194
Personal Care		-			39,689			-			39,689
Inks		-			586			-			586
Asia Pacific		-			-			35,221			35,221
Intersegment Revenue		(5,649	)		(6,899	)		(112	)		(12,660	)
Total revenue from external customers	$	181,397		$	144,570		$	35,109		$	361,076
Three months ended September 30, 2021:
Flavors, Extracts & Flavor Ingredients	$	116,140		$	-		$	-		$	116,140
Natural Ingredients		64,215			-			-			64,215
Yogurt Fruit Preparations		1,312			-			-			1,312
Food & Pharmaceutical Colors		-			99,688			-			99,688
Personal Care		-			39,241			-			39,241
Inks		-			310			-			310
Asia Pacific		-			-			33,442			33,442
Intersegment Revenue		(5,977	)		(3,844	)		(240	)		(10,061	)
Total revenue from external customers	$	175,690		$	135,395		$	33,202		$	344,287

(In thousands)	Flavors & Extracts			Color			Asia Pacific			Consolidated
Nine months ended September 30, 2022:
Flavors, Extracts & Flavor Ingredients	$	381,041		$	-		$	-		$	381,041
Natural Ingredients		178,069			-			-			178,069
Food & Pharmaceutical Colors		-			328,087			-			328,087
Personal Care		-			126,651			-			126,651
Inks		-			1,437			-			1,437
Asia Pacific		-			-			109,014			109,014
Intersegment Revenue		(20,096	)		(15,607	)		(293	)		(35,996	)
Total revenue from external customers	$	539,014		$	440,568		$	108,721		$	1,088,303
Nine months ended September 30, 2021:
Flavors, Extracts & Flavor Ingredients	$	347,642		$	-		$	-		$	347,642
Natural Ingredients		186,721			-			-			186,721
Fragrances		22,739			-			-			22,739
Yogurt Fruit Preparations		4,877			-			-			4,877
Food & Pharmaceutical Colors		-			287,565			-			287,565
Personal Care		-			119,079			-			119,079
Inks		-			1,522			-			1,522
Asia Pacific		-			-			99,599			99,599
Intersegment Revenue		(16,929	)		(12,740	)		(259	)		(29,928	)
Total revenue from external customers	$	545,050		$	395,426		$	99,340		$	1,039,816

Geographic Markets

(In thousands)	Flavors & Extracts		Color		Asia Pacific		Consolidated
Three months ended September 30, 2022:
North America	$	142,097	$	74,220	$	27	$	216,344
Europe		26,795		34,591		44		61,430
Asia Pacific		7,091		16,770		34,433		58,294
Other		5,414		18,989		605		25,008
Total revenue from external customers	$	181,397	$	144,570	$	35,109	$	361,076
Three months ended September 30, 2021:
North America	$	131,855	$	67,830	$	5	$	199,690
Europe		30,241		37,004		30		67,275
Asia Pacific		6,410		14,451		32,511		53,372
Other		7,184		16,110		656		23,950
Total revenue from external customers	$	175,690	$	135,395	$	33,202	$	344,287

(In thousands)	Flavors & Extracts		Color		Asia Pacific		Consolidated
Nine months ended September 30, 2022:
North America	$	407,684	$	223,508	$	87	$	631,279
Europe		90,565		116,184		175		206,924
Asia Pacific		23,628		49,199		105,222		178,049
Other		17,137		51,677		3,237		72,051
Total revenue from external customers	$	539,014	$	440,568	$	108,721	$	1,088,303
Nine months ended September 30, 2021:
North America	$	390,163	$	188,764	$	67	$	578,994
Europe		107,463		112,188		106		219,757
Asia Pacific		24,288		47,832		96,863		168,983
Other		23,136		46,642		2,304		72,082
Total revenue from external customers	$	545,050	$	395,426	$	99,340	$	1,039,816