ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
(State of Incorporation)
|
|
(IRS Employer Identification Number)
|
TITLE OF EACH CLASS
|
TRADING SYMBOL(S)
|
NAME OF EACH EXCHANGE
ON WHICH REGISTERED
|
|
Accelerated Filer ☐
|
Non-Accelerated Filer ☐
|
|
Smaller Reporting Company
|
Emerging Growth Company
|
|
|
4
|
|||
4
|
|||
4
|
|||
4
|
|||
5
|
|||
5
|
|||
5
|
|||
5
|
|||
6
|
|||
6
|
|||
6
|
|||
6
|
|||
7
|
|||
7
|
|||
7
|
|||
8
|
|||
8
|
|||
9
|
|||
9
|
|||
17
|
|||
17
|
|||
18
|
|||
18
|
|||
18
|
|||
19
|
|||
19
|
|||
19
|
|||
20
|
|||
26
|
|||
28
|
|||
55
|
|||
55
|
|||
56
|
|||
56
|
|||
57
|
|||
57
|
|||
57
|
|||
57
|
|||
57
|
|||
57
|
|||
58
|
|||
58
|
|||
58
|
|||
64
|
|||
64
|
|||
64
|
|||
58
|
|||
65
|
Item 1. |
Business.
|
• |
flavors, flavor enhancers, ingredients, extracts, and bionutrients;
|
• |
essential oils;
|
• |
dehydrated vegetables and other food ingredients;
|
• |
natural and synthetic food and beverage colors;
|
• |
personal care colors and ingredients;
|
• |
pharmaceutical and nutraceutical excipients and ingredients; and
|
• |
technical colors, specialty colors, and specialty dyes and pigments.
|
• |
Sensient Food Colors (food and beverage colors);
|
• |
Sensient Pharmaceutical Coating Systems (pharmaceutical and nutraceutical colors and coatings);
|
• |
Sensient Cosmetic Technologies (personal care colors, ingredients, and systems); and
|
• |
Sensient Specialty Markets (paper colors; and industrial colors for plastics, leather, wood stains, antifreeze, landscaping, and other uses).
|
•
|
Flavors & Extracts. Competition in the flavors, extracts, and ingredients industries continues to have an ever-increasing global nature. Most of the Company’s
customers do not buy all of their flavor and ingredients products from a single supplier, and the Company does not compete with a single supplier in all product categories. Competition for the supply of flavors, extracts, and
essential oils is based on the development of customized ingredients for new and reformulated customer products as well as on quality, customer service, and price. Competition to supply
dehydrated vegetable products is present through several large and small domestic competitors as well as competitors from other countries. Competition for the supply of dehydrated vegetables is based principally on product quality,
customer service, and price.
|
• |
Color. Competition in the color market is diverse, with the majority of the Company’s competitors specializing in either synthetic dyes and pigments or natural
colors or coloring foodstuffs (in Europe). The Company believes that it gains a competitive advantage as the only major basic manufacturer of a full range of color products, including synthetic dyes and pigments as well as natural
colors. Competition in the supply of personal care colors and ingredients and pharmaceutical and nutraceutical ingredients and excipients is based on the development of customized products and solutions as well as quality, customer
service, and price. The Company believes that its reputation and capacity as a color producer as well as its product development and applications expertise give it a competitive advantage in these markets.
|
• |
Asia Pacific. The Company offers a broad array of products to customers through the Asia Pacific Group. Competition is based upon reliability in product quality,
service, and price as well as technical support available to customers.
|
Item 1A. |
Risk Factors.
|
• |
Intense competition with our competitors may result in reduced sales and profitability.
|
• |
Our business is impacted by adverse developments in economic conditions, which could negatively affect our financial performance and our ability to grow or sustain the growth of our
business.
|
• |
A disruption in our manufacturing operations could adversely affect our profitability.
|
• |
The coronavirus/COVID-19 has significantly impacted worldwide economic conditions and could adversely affect our results and financial condition.
|
• |
Intense competition among our customers and their competitors may result in reduced sales and profitability for our customers and us.
|
• |
The ongoing military conflict between Russia and Ukraine, and the global response to it, may adversely affect our operations.
|
• |
In some product lines, most of our sales are made to a relatively small number of customers; if we lose any of those customers, sales and operating results could decline.
|
• |
Consolidation has resulted in customers with increased buying power, which can affect our profitability.
|
• |
Our sales and profitability are affected by changing consumer preferences, changing regulations and technologies, and our ability and our customers’ ability to make and sell to
consumers in highly competitive markets.
|
• |
If we do not maintain an efficient cost structure, our profitability could decrease.
|
• |
A disruption in our supply chain could adversely affect our profitability.
|
• |
We may not be able to manage inventory as effectively as anticipated, which may adversely impact our performance.
|
• |
Raw material, energy, labor, and transportation cost volatility, including inflation in prices due to ongoing supply chain challenges and other macroeconomic forces, may reduce our
profitability.
|
• |
The financial condition of our customers may adversely affect their ability to buy products from us at current levels, to accept price increases, or to pay for products that they have
already purchased.
|
• |
The impact of currency exchange rate fluctuation may negatively affect our results.
|
• |
Operating in foreign countries and emerging markets exposes us to increased risks, including economic, political, security, and international operation risks.
|
• |
The impact of tariffs and other trade barriers may negatively affect our results.
|
• |
Various stakeholders’ increasing and changing expectations and new laws and regulations with respect to Environmental, Social, and Governance (ESG) matters may impose additional costs
on us or expose us to additional risks.
|
• |
World events and natural disasters are beyond our control and could affect our results.
|
• |
Many of our products are used in items for human consumption and contact. We may be subject to product liability claims and product recalls, which could negatively impact our
profitability and corporate image.
|
• |
There are an enormous number of laws and regulations applicable to us, our suppliers, and our customers across all of our business lines. Compliance with these legal requirements is
costly to us and can affect our operations as well as those of our suppliers and customers. Failure to comply could also be costly and disruptive.
|
• |
Environmental compliance may be costly to us.
|
• |
We could be adversely affected by violations of anti-bribery and anti-corruption laws and regulations.
|
• |
Changes in tax rates or tax laws could expose us to additional tax liabilities that may negatively affect our results.
|
• |
We depend on certain key personnel, and the loss of these persons may harm our business, including the loss of trade secrets.
|
• |
We face risks associated with strategic transactions that we have completed and may pursue in the future, which could adversely affect our operating results.
|
• |
Our ability to protect our intellectual property rights is key to our performance.
|
• |
Our ability to successfully maintain and upgrade our information technology systems, and to respond effectively to failures, disruptions, compromises, or breaches of our information
technology systems, may adversely affect our competitiveness and profitability.
|
Item 1B. |
Unresolved Staff Comments.
|
Item 2. |
Properties.
|
Item 3. |
Legal Proceedings.
|
Item 4. |
Mine Safety Disclosure.
|
Name
|
Age
|
Position
|
Paul Manning
|
48
|
Chairman, President, and Chief Executive Officer
|
Amy M. Agallar
|
45
|
Vice President and Treasurer
|
Michael C. Geraghty
|
61
|
President, Color Group
|
Thierry Hoang
|
42
|
Vice President, Asia Pacific Group
|
Amy Schmidt Jones
|
53
|
Vice President, Human Resources and Senior Counsel
|
John J. Manning
|
54
|
Senior Vice President, General Counsel, and Secretary
|
E. Craig Mitchell
|
58
|
President, Flavors & Extracts Group
|
Stephen J. Rolfs
|
58
|
Senior Vice President and Chief Financial Officer
|
Tobin Tornehl
|
49
|
Vice President, Controller and Chief Accounting Officer
|
• |
Ms. Agallar has held her present office since January 9, 2019. Prior to joining the Company, Ms. Agallar was Director – Business Development CIS of Modine Manufacturing (June 2018 – January 2019), and
Director – Global Treasury Operations of Modine Manufacturing (2011– June 2018).
|
• |
Mr. Hoang has held his present office since June 1, 2018, and previously served as a General Manager, Business Unit Manager, and Sales Account Manager for Sensient Cosmetics in France and Asia Pacific
(2009 – May 2018).
|
• |
Ms. Jones has held her present office since April 2, 2018. Prior to joining the Company, Ms. Jones was a partner of Michael Best & Friedrich LLP (1998 – March 2018).
|
• |
Mr. Mitchell has held his present office since September 17, 2018. Prior to joining the Company, Mr. Mitchell served as President and Chief Operating Officer of Sekisui Specialty Chemical America, LLC
(April 2016 – September 2018), and Vice President of Sales, Americas of Celanese Corporation (2013 – April 2016).
|
• |
Mr. Tornehl has held his present office since November 10, 2018, and previously served as Director, Finance (2008 – November 2018).
|
Item 5. |
Market for the Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities.
|
December
31, 2017
|
December
31, 2018
|
December
31, 2019
|
December
31, 2020
|
December
31, 2021
|
December
31, 2022
|
|||||||||||||||||||
Sensient Technologies Corporation
|
$
|
100
|
$
|
78
|
$
|
94
|
$
|
108
|
$
|
150
|
$
|
111
|
||||||||||||
S&P Midcap Specialty Chemicals Index
|
100
|
95
|
113
|
121
|
144
|
128
|
||||||||||||||||||
S&P Midcap Food Products Index
|
100
|
93
|
109
|
120
|
140
|
137
|
||||||||||||||||||
S&P 500 Index
|
100
|
96
|
126
|
149
|
191
|
157
|
Item 6. |
[Reserved]
|
Item 7. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
2022
|
2021
|
|||||||
Rate before divestiture and discrete items
|
25.8
|
%
|
24.3
|
%
|
||||
Divestiture & other related costs and income impact
|
-
|
4.2
|
%
|
|||||
Discrete items
|
(3.1
|
%)
|
(3.9
|
%)
|
||||
Reported effective tax rate
|
22.7
|
%
|
24.6
|
%
|
Twelve Months Ended December 31,
|
||||||||||||
(In thousands except per share amounts)
|
2022
|
2021
|
% Change
|
|||||||||
Revenue (GAAP)
|
$
|
1,437,039
|
$
|
1,380,264
|
4.1
|
%
|
||||||
Revenue of the divested product lines
|
-
|
(30,062
|
)
|
|||||||||
Adjusted revenue
|
$
|
1,437,039
|
1,350,202
|
6.4
|
%
|
|||||||
Operating Income (GAAP)
|
$
|
196,751
|
$
|
170,028
|
15.7
|
%
|
||||||
Divestiture & other related costs – Cost of products sold
|
-
|
86
|
||||||||||
Divestiture & other related (income) costs – Selling and administrative expenses
|
(2,532
|
)
|
14,052
|
|||||||||
Operating income of the divested product lines
|
-
|
(1,880
|
)
|
|||||||||
Operational improvement plan income – Selling and administrative expenses
|
-
|
(1,895
|
)
|
|||||||||
Adjusted operating income
|
$
|
194,219
|
$
|
180,391
|
7.7
|
%
|
||||||
Net Earnings (GAAP)
|
$
|
140,887
|
$
|
118,745
|
18.6
|
%
|
||||||
Divestiture & other related (income) costs, before tax
|
(2,532
|
)
|
14,138
|
|||||||||
Tax impact of divestiture & other related costs and income(1)
|
636
|
2,092
|
||||||||||
Net earnings of the divested product lines, before tax
|
-
|
(1,880
|
)
|
|||||||||
Tax impact of the divested product lines(1)
|
-
|
460
|
||||||||||
Operational improvement plan income, before tax
|
-
|
(1,895
|
)
|
|||||||||
Tax impact of operational improvement plan(1)
|
-
|
471
|
||||||||||
Adjusted net earnings
|
$
|
138,991
|
$
|
132,131
|
5.2
|
%
|
||||||
Diluted Earnings Per Share (GAAP)
|
$
|
3.34
|
$
|
2.81
|
18.9
|
%
|
||||||
Divestiture & other related (income) costs, net of tax
|
(0.04
|
)
|
0.38
|
|||||||||
Results of operations of the divested product lines, net of tax
|
-
|
(0.03
|
)
|
|||||||||
Operational improvement plan, net of tax
|
-
|
(0.03
|
)
|
|||||||||
Adjusted diluted earnings per share
|
$
|
3.29
|
$
|
3.13
|
5.1
|
%
|
|
Twelve Months Ended December 31, 2022
|
|||||||||||||||
Total
|
Foreign Exchange
Rates
|
Adjustments(1)
|
Adjusted Local
Currency
|
|||||||||||||
Revenue
|
||||||||||||||||
Flavors & Extracts
|
(0.2
|
%)
|
(2.2
|
%)
|
(3.8
|
%)
|
5.8
|
%
|
||||||||
Color
|
10.8
|
%
|
(3.8
|
%)
|
(0.4
|
%)
|
15.0
|
%
|
||||||||
Asia Pacific
|
6.1
|
%
|
(8.0
|
%)
|
(0.3
|
%)
|
14.4
|
%
|
||||||||
Total Revenue
|
4.1
|
%
|
(3.4
|
%)
|
(2.2
|
%)
|
9.7
|
%
|
||||||||
Operating Income
|
||||||||||||||||
Flavors & Extracts
|
6.9
|
%
|
(0.9
|
%)
|
(2.5
|
%)
|
10.3
|
%
|
||||||||
Color
|
10.7
|
%
|
(5.1
|
%)
|
0.7
|
%
|
15.1
|
%
|
||||||||
Asia Pacific
|
12.0
|
%
|
(10.1
|
%)
|
(0.4
|
%)
|
22.5
|
%
|
||||||||
Corporate & Other
|
(9.8
|
%)
|
0.0
|
%
|
(29.4
|
%)
|
19.6
|
%
|
||||||||
Total Operating Income
|
15.7
|
%
|
(5.2
|
%)
|
8.4
|
%
|
12.5
|
%
|
||||||||
Diluted Earnings per Share
|
18.9
|
%
|
(5.3
|
%)
|
14.3
|
%
|
9.9
|
%
|
(1) |
For Revenue, adjustments consist of revenues of the divested product lines. For Operating Income and Diluted Earnings per Share, adjustments consist of the results of the divested
product lines, divestitures & other related costs and income, and operational improvement plan costs and income.
|
Note: |
Refer to table above for a reconciliation of these non-GAAP measures.
|
Item 7A. |
Quantitative and Qualitative Disclosures about Market Risk.
|
|
Years Ended December 31,
|
|||||||||||
(In thousands except per share amounts)
|
2022
|
2021
|
2020
|
|||||||||
Revenue
|
$
|
|
$
|
|
$
|
|
||||||
Cost of products sold
|
|
|
|
|||||||||
Selling and administrative expenses
|
|
|
|
|||||||||
Operating income
|
|
|
|
|||||||||
Interest expense
|
|
|
|
|||||||||
Earnings before income taxes
|
|
|
|
|||||||||
Income taxes
|
|
|
|
|||||||||
Net earnings
|
$
|
|
$
|
|
$
|
|
||||||
|
||||||||||||
Earnings per common share:
|
||||||||||||
Basic
|
$
|
|
$
|
|
$
|
|
||||||
Diluted
|
$
|
|
$
|
|
$
|
|
||||||
|
||||||||||||
Weighted average number of common shares outstanding:
|
||||||||||||
Basic
|
|
|
|
|||||||||
Diluted
|
|
|
|
|
Years Ended December 31,
|
|||||||||||
(In thousands)
|
2022
|
2021
|
2020
|
|||||||||
Net earnings
|
$
|
|
$
|
|
$
|
|
||||||
Cash flow hedges adjustment, net of tax (benefit) expense of $(
|
(
|
)
|
(
|
)
|
|
|||||||
Pension adjustment, net of tax (benefit) expense of $(
|
(
|
)
|
|
(
|
)
|
|||||||
Foreign currency translation on net investment hedges
|
|
|
(
|
)
|
||||||||
Tax effect of current year activity on net investment hedges
|
(
|
)
|
(
|
)
|
|
|||||||
Foreign currency translation on long-term intercompany loans
|
(
|
)
|
|
(
|
)
|
|||||||
Tax effect of current year activity on intercompany long-term loans
|
(
|
)
|
(
|
)
|
|
|||||||
Reclassification of cumulative translation to net earnings
|
|
|
(
|
)
|
||||||||
Other foreign currency translation
|
(
|
)
|
(
|
)
|
|
|||||||
Total comprehensive income
|
$
|
|
$
|
|
$
|
|
|
December 31,
|
|||||||
(In thousands except share and per share amounts)
|
2022
|
2021
|
||||||
Assets
|
||||||||
Current Assets:
|
||||||||
Cash and cash equivalents
|
$
|
|
$
|
|
||||
Trade accounts receivable
|
|
|
||||||
Inventories
|
|
|
||||||
Prepaid expenses and other current assets
|
|
|
||||||
Total current assets
|
|
|
||||||
Other assets
|
|
|
||||||
Deferred tax assets
|
|
|
||||||
Intangible assets, net
|
|
|
||||||
Goodwill
|
|
|
||||||
Property, Plant, and Equipment:
|
||||||||
Land
|
|
|
||||||
Buildings
|
|
|
||||||
Machinery and equipment
|
|
|
||||||
Construction in progress
|
|
|
||||||
|
|
|
||||||
Less accumulated depreciation
|
(
|
)
|
(
|
)
|
||||
|
|
|
||||||
Total assets
|
$
|
|
$
|
|
||||
|
||||||||
Liabilities and Shareholders’ Equity
|
||||||||
Current Liabilities:
|
||||||||
Trade accounts payable
|
$
|
|
$
|
|
||||
Accrued salaries, wages, and withholdings from employees
|
|
|
||||||
Other accrued expenses
|
|
|
||||||
Income taxes
|
|
|
||||||
Short-term borrowings
|
|
|
||||||
Total current liabilities
|
|
|
||||||
Deferred tax liabilities
|
|
|
||||||
Other liabilities
|
|
|
||||||
Accrued employee and retiree benefits
|
|
|
||||||
Long-term debt
|
|
|
||||||
Shareholders’ Equity:
|
||||||||
Common stock, par value $
|
|
|
||||||
Additional paid-in capital
|
|
|
||||||
Earnings reinvested in the business
|
|
|
||||||
Treasury stock,
|
(
|
)
|
(
|
)
|
||||
Accumulated other comprehensive loss
|
(
|
)
|
(
|
)
|
||||
|
|
|
||||||
Total liabilities and shareholders’ equity
|
$
|
|
$
|
|
|
Years ended December 31,
|
|||||||||||
(In thousands)
|
2022
|
2021
|
2020
|
|||||||||
Cash Flows from Operating Activities
|
||||||||||||
Net earnings
|
$
|
|
$
|
|
$
|
|
||||||
Adjustments to arrive at net cash provided by operating activities:
|
||||||||||||
Depreciation and amortization
|
|
|
|
|||||||||
Share-based compensation expense
|
|
|
|
|||||||||
Net loss (gain) on assets
|
|
|
(
|
)
|
||||||||
Net (gain) loss on divestitures and other charges
|
(
|
)
|
|
|
||||||||
Deferred income taxes
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Changes in operating assets and liabilities:
|
||||||||||||
Trade accounts receivable
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Inventories
|
(
|
)
|
(
|
)
|
|
|||||||
Prepaid expenses and other assets
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Trade accounts payable and other accrued expenses
|
|
|
|
|||||||||
Accrued salaries, wages, and withholdings from employees
|
|
|
|
|||||||||
Income taxes
|
|
|
|
|||||||||
Other liabilities
|
|
|
|
|||||||||
Net cash provided by operating activities
|
|
|
|
|||||||||
|
||||||||||||
Cash Flows from Investing Activities
|
||||||||||||
Acquisition of property, plant, and equipment
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Proceeds from sale of assets
|
|
|
|
|||||||||
Proceeds from divestiture of businesses
|
|
|
|
|||||||||
Acquisition of new businesses
|
(
|
)
|
(
|
)
|
|
|||||||
Other investing activities
|
|
|
|
|||||||||
Net cash used in investing activities
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
|
||||||||||||
Cash Flows from Financing Activities
|
||||||||||||
Proceeds from additional borrowings
|
|
|
|
|||||||||
Debt payments
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Purchase of treasury stock
|
|
(
|
)
|
|
||||||||
Dividends paid
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Other financing activities
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Net cash provided by (used in) financing activities
|
|
(
|
)
|
(
|
)
|
|||||||
|
||||||||||||
Effect of exchange rate changes on cash and cash equivalents
|
(
|
)
|
(
|
)
|
|
|||||||
|
||||||||||||
Net (decrease) increase in cash and cash equivalents
|
(
|
)
|
|
|
||||||||
Cash and cash equivalents at beginning of year
|
|
|
|
|||||||||
|
||||||||||||
Cash and cash equivalents at end of year
|
$
|
|
$
|
|
$
|
|
||||||
|
||||||||||||
Cash paid during the year for:
|
||||||||||||
Interest
|
$
|
|
$
|
|
$
|
|
||||||
Income taxes
|
|
|
|
|||||||||
Capitalized interest
|
|
|
|
(In thousands except
share and per share
|
Common
|
Additional
Paid-in
|
Earnings
Reinvested
in the
|
Treasury Stock
|
Accumulated
Other
Comprehensive
|
|||||||||||||||||||
amounts)
|
Stock
|
Capital
|
Business
|
Shares
|
Amount
|
(Loss) Income
|
||||||||||||||||||
Balances at December 31, 2019
|
$
|
|
$
|
|
$
|
|
|
$
|
(
|
)
|
$
|
(
|
)
|
|||||||||||
Net earnings
|
|
|||||||||||||||||||||||
Other comprehensive income
|
|
|||||||||||||||||||||||
Cash dividends paid – $
|
(
|
)
|
||||||||||||||||||||||
Share-based compensation
|
|
|||||||||||||||||||||||
Non-vested stock issued upon vesting
|
(
|
)
|
(
|
)
|
|
|||||||||||||||||||
Benefit plans
|
|
(
|
)
|
|
||||||||||||||||||||
Other
|
(
|
)
|
( |
) |
|
(
|
)
|
|||||||||||||||||
Balances at December 31, 2020
|
|
|
|
|
(
|
)
|
(
|
)
|
||||||||||||||||
Net earnings
|
|
|||||||||||||||||||||||
Other comprehensive loss
|
(
|
)
|
||||||||||||||||||||||
Cash dividends paid – $
|
(
|
)
|
||||||||||||||||||||||
Share-based compensation
|
|
|||||||||||||||||||||||
Non-vested stock issued upon vesting
|
(
|
)
|
(
|
)
|
|
|||||||||||||||||||
Benefit plans
|
|
(
|
)
|
|
||||||||||||||||||||
Purchase of treasury stock |
( |
) | ||||||||||||||||||||||
Other
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||
Balances at December 31, 2021
|
|
|
|
|
(
|
)
|
(
|
)
|
||||||||||||||||
Net earnings
|
|
|||||||||||||||||||||||
Other comprehensive loss
|
(
|
)
|
||||||||||||||||||||||
Cash dividends paid – $
|
(
|
)
|
||||||||||||||||||||||
Share-based compensation
|
|
|||||||||||||||||||||||
Non-vested stock issued upon vesting
|
(
|
)
|
(
|
)
|
|
|||||||||||||||||||
Benefit plans
|
|
(
|
)
|
|
||||||||||||||||||||
Other
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||
Balances at December 31, 2022
|
$
|
|
$
|
|
$
|
|
|
$
|
(
|
)
|
$
|
(
|
)
|
• |
Identification of the contract, or contracts, with a customer
|
• |
Identification of the performance obligations in the contract
|
• |
Determination of the transaction price
|
• |
Allocation of the transaction price to the performance obligations in the contract
|
• |
Recognition of revenue when, or as, the Company satisfies the performance obligations
|
|
Years Ended December 31,
|
|||||||||||
(In thousands except per share amounts)
|
2022
|
2021
|
2020
|
|||||||||
Numerator:
|
||||||||||||
Net earnings
|
$
|
|
$
|
|
$
|
|
||||||
Denominator:
|
||||||||||||
Denominator for basic EPS - weighted average common shares
|
|
|
|
|||||||||
Effect of dilutive securities
|
|
|
|
|||||||||
Denominator for diluted EPS - diluted weighted average shares outstanding
|
|
|
|
|||||||||
|
||||||||||||
Earnings per Common Share:
|
||||||||||||
Basic
|
$
|
|
$
|
|
$
|
|
||||||
Diluted
|
$
|
|
$
|
|
$
|
|
(In thousands)
|
Allowance for
Doubtful Accounts
|
|||
Balance at December 31, 2020
|
$
|
|
||
Provision for expected credit losses
|
|
|||
Accounts written off
|
(
|
)
|
||
Translation and other activity
|
(
|
)
|
||
Balance at December 31, 2021
|
$
|
|
||
Provision for expected credit losses |
||||
Accounts written off |
( |
) | ||
Translation and other activity |
( |
) | ||
Balance at December 31, 2022 | $ |
|
2022
|
2021
|
||||||||||||||||||
(In thousands except weighted average amortization years)
|
Weighted
Average
Amortization
Years
|
Cost
|
Accumulated
Amortization
|
Cost
|
Accumulated
Amortization
|
|||||||||||||||
|
||||||||||||||||||||
Technological know-how
|
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
|||||||||
Customer relationships
|
|
|
(
|
)
|
|
(
|
)
|
|||||||||||||
Patents, trademarks, non-compete agreements, and other
|
|
|
(
|
)
|
|
(
|
)
|
|||||||||||||
Total finite-lived intangibles
|
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
(In thousands)
|
Flavors &
Extracts
|
Color
|
Asia Pacific
|
Consolidated
|
||||||||||||
Balance as of December 31,
2020
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Currency translation impact
|
(
|
)
|
|
(
|
)
|
(
|
)
|
|||||||||
Goodwill related to divestitures(1)
|
(
|
)
|
|
|
(
|
)
|
||||||||||
Acquisitions(2)
|
||||||||||||||||
Balance as of December 31,
2021
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Currency translation impact
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Acquisitions(2)
|
||||||||||||||||
Balance as of December 31,
2022
|
$
|
|
$
|
|
$
|
|
$
|
|
(1) |
|
(2) |
|
(In thousands)
|
||||
Year ending December 31,
|
||||
2023
|
$
|
|
||
2024
|
|
|||
2025
|
|
|||
2026
|
|
|||
2027
|
|
|||
Thereafter
|
|
|||
Total lease payments
|
|
|||
Less imputed interest
|
(
|
)
|
||
Present value of lease liabilities
|
$
|
|
(In thousands)
|
2022
|
2021
|
||||||
|
$
|
|
$
|
|
||||
|
|
|
||||||
|
|
|
||||||
|
|
|
||||||
|
|
|
||||||
|
|
|
||||||
|
|
|
||||||
|
|
|
||||||
|
|
|
||||||
Euro-denominated term loan
|
|
|
||||||
Revolving Credit Facilities
|
|
|
||||||
Various other notes
|
|
|
||||||
Total debt
|
|
|
||||||
Less debt fees
|
(
|
)
|
(
|
)
|
||||
Less current portion
|
(
|
)
|
(
|
)
|
||||
Total long-term debt
|
$
|
|
$
|
|
(In thousands)
|
||||
Year ending December 31,
|
||||
2023
|
$
|
|
||
2024
|
|
|||
2025
|
|
|||
2026
|
|
|||
2027
|
|
|||
Total long-term debt maturities
|
$
|
|
(In thousands)
|
2022
|
2021
|
||||||
U.S. credit facilities
|
$
|
|
$
|
|
||||
Current maturities of long-term debt
|
|
|
||||||
Loans of foreign subsidiaries
|
|
|
||||||
Total
|
$
|
|
$
|
|
(In thousands except fair value)
|
Shares
|
Grant Date
Weighted Average
Fair Value
|
Aggregate Intrinsic
Value
|
|||||||||
Outstanding at December 31,
2019
|
|
$
|
|
|
|
|||||||
Granted
|
|
|
||||||||||
Vested
|
(
|
)
|
|
|||||||||
Cancelled
|
(
|
)
|
|
|||||||||
Outstanding at December 31,
2020
|
|
$ |
|
|
||||||||
Granted
|
|
|
||||||||||
Vested
|
(
|
)
|
|
|||||||||
Cancelled
|
(
|
)
|
|
|||||||||
Outstanding at December 31,
2021
|
|
$ |
|
$ |
|
|||||||
Granted
|
|
|
||||||||||
Vested
|
(
|
)
|
|
|||||||||
Cancelled
|
(
|
)
|
|
|||||||||
Outstanding at December 31,
2022
|
|
$
|
|
$
|
|
(In thousands)
|
2022
|
2021
|
||||||
Benefit obligation at beginning of year
|
$
|
|
$
|
|
||||
Service cost
|
|
|
||||||
Interest cost
|
|
|
||||||
Foreign currency exchange rate changes
|
(
|
)
|
(
|
)
|
||||
Benefits and settlements paid
|
(
|
)
|
(
|
)
|
||||
Actuarial gain
|
(
|
)
|
(
|
)
|
||||
Benefit obligation at end of year
|
|
|
||||||
Plan assets at beginning of year
|
|
|
||||||
Company contributions
|
|
|
||||||
Foreign currency exchange rate changes
|
(
|
)
|
(
|
)
|
||||
Benefits paid
|
(
|
)
|
(
|
)
|
||||
Settlement payments |
( |
) | ||||||
Actual loss on plan assets
|
(
|
)
|
(
|
)
|
||||
Plan assets at end of year
|
|
|
||||||
Funded status
|
$
|
(
|
)
|
$
|
(
|
)
|
||
Accumulated benefit obligation
|
$
|
|
$
|
|
(In thousands)
|
2022
|
2021
|
||||||
Accrued employee and retiree benefits
|
$
|
(
|
)
|
$
|
(
|
)
|
||
Other accrued expenses
|
(
|
)
|
(
|
)
|
||||
Other assets
|
|
|
||||||
Net liability
|
$
|
(
|
)
|
$
|
(
|
)
|
(In thousands)
|
2022
|
2021
|
2020
|
|||||||||
Service cost
|
$
|
|
$
|
|
$
|
|
||||||
Interest cost
|
|
|
|
|||||||||
Expected return on plan assets
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Recognized actuarial loss
|
|
|
|
|||||||||
Settlement income
|
|
(
|
)
|
|
||||||||
Defined benefit expense
|
$
|
|
$
|
|
$
|
|
|
2022
|
2021
|
||||||
Discount rate
|
|
%
|
|
%
|
||||
Expected return on plan assets
|
|
%
|
|
%
|
||||
Rate of compensation increase
|
|
%
|
|
%
|
|
2022
|
2021
|
2020
|
|||||||||
Discount rate
|
|
%
|
|
%
|
|
%
|
||||||
Expected return on plan assets
|
|
%
|
|
%
|
|
%
|
||||||
Rate of compensation increase
|
|
%
|
|
%
|
|
%
|
(In thousands)
|
2022
|
2021
|
||||||
Unrecognized net actuarial loss
|
$
|
|
$
|
|
||||
Prior service cost
|
|
|
||||||
Total before tax effects
|
$
|
|
$
|
|
(In thousands)
|
2022
|
2021
|
2020
|
|||||||||
Net actuarial (loss) gain arising during the period
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
||||
Prior service cost
|
|
|
(
|
)
|
||||||||
Amortization of actuarial loss, included in defined benefit expense
|
|
|
|
|||||||||
Pension adjustment, net of tax
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
|
Fair Value
as of
December 31,
|
Fair Value Measurements at
December 31, 2022
Using Fair Value Hierarchy
|
Fair Value
as of
December 31,
|
Fair Value Measurements at
December 31, 2021
Using Fair Value Hierarchy
|
||||||||||||||||||||||||||||
(In thousands)
|
2022
|
Level 1
|
Level 2
|
Level 3
|
2021
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||||||||||||||
Equity Funds
|
||||||||||||||||||||||||||||||||
Domestic
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||
International
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
International Fixed Income Funds
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Other investments
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Total assets at fair value
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
Level 1: |
Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
|
Level 2: |
Inputs other than quoted prices included in Level 1 that are observable for the asset or liability through corroboration with observable market data.
|
Level 3: |
Unobservable inputs that reflect the reporting entity’s own assumptions.
|
(In thousands)
|
Cash Flow
Hedges (1)
|
Pension
Items (1)
|
Foreign Currency
Items
|
Total
|
||||||||||||
Balance as of December 31,
2019
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
||||
Other comprehensive income (loss) before reclassifications
|
(
|
)
|
(
|
)
|
|
|
||||||||||
Amounts reclassified from OCI
|
|
|
(
|
)
|
(
|
)
|
||||||||||
Balance as of December 31,
2020
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
|||||
Other comprehensive income (loss) before reclassifications
|
|
|
(
|
)
|
(
|
)
|
||||||||||
Amounts reclassified from OCI
|
(
|
)
|
|
|
|
|||||||||||
Balance as of December 31,
2021
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
|||||
Other comprehensive income (loss) before reclassifications
|
|
(
|
)
|
(
|
)
|
(
|
)
|
|||||||||
Amounts reclassified from OCI
|
(
|
)
|
|
|
(
|
)
|
||||||||||
Balance as of December 31,
2022
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
(1) |
|
(In thousands)
|
2022
|
2021
|
2020
|
|||||||||
United States
|
$
|
|
$
|
|
$
|
|
||||||
Foreign
|
|
|
|
|||||||||
Total
|
$
|
|
$
|
|
$
|
|
(In thousands)
|
2022
|
2021
|
2020
|
|||||||||
Current income tax expense:
|
||||||||||||
Federal
|
$
|
|
$
|
|
$
|
|
||||||
State
|
|
|
|
|||||||||
Foreign
|
|
|
|
|||||||||
|
|
|
|
|||||||||
Deferred benefit:
|
||||||||||||
Federal
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
State
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Foreign
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Income taxes
|
$
|
|
$
|
|
$
|
|
|
2022
|
2021
|
2020
|
|||||||||
Taxes at statutory rate
|
|
%
|
|
%
|
|
%
|
||||||
State income taxes, net of federal income tax benefit
|
|
|
|
|||||||||
Tax credits
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Taxes on foreign earnings
|
|
|
|
|||||||||
Global Intangible Low-Taxed Income
|
|
|
|
|||||||||
Foreign Derived Intangible Income
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Loss on balance sheet hedge
|
|
|
|
|||||||||
Resolution of prior years’ tax matters
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Valuation allowance adjustments
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Nondeductible compensation |
||||||||||||
Other, net
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Effective tax rate
|
|
%
|
|
%
|
|
%
|
(In thousands)
|
2022
|
2021
|
||||||
Deferred tax assets:
|
||||||||
Benefit plans
|
$
|
|
$
|
|
||||
Liabilities and reserves
|
|
|
||||||
Operating loss and credit carryovers
|
|
|
||||||
Capitalized research and development costs
|
||||||||
Other
|
|
|
||||||
Gross deferred tax assets
|
|
|
||||||
Valuation allowance
|
(
|
)
|
(
|
)
|
||||
Deferred tax assets
|
|
|
||||||
Deferred tax liabilities:
|
||||||||
Property, plant, and equipment
|
(
|
)
|
(
|
)
|
||||
Goodwill
|
(
|
)
|
(
|
)
|
||||
Deferred tax liabilities
|
(
|
)
|
(
|
)
|
||||
Net deferred tax assets
|
$
|
|
$
|
|
(In thousands)
|
2022
|
2021
|
||||||
Balance at beginning of year
|
$
|
|
$
|
|
||||
Increases for tax positions taken in the current year
|
|
|
||||||
Decreases related to settlements with tax authorities
|
(
|
)
|
(
|
)
|
||||
Decreases as a result of lapse of the applicable statutes of limitations
|
(
|
)
|
(
|
)
|
||||
Foreign currency exchange rate changes
|
(
|
)
|
(
|
)
|
||||
Balance at the end of year
|
$
|
|
$
|
|
(In thousands)
|
Flavors &
Extracts
|
Color
|
Asia Pacific
|
Corporate
& Other
|
Consolidated
|
|||||||||||||||
2022:
|
||||||||||||||||||||
Revenue from external customers
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Intersegment revenue
|
|
|
|
|
|
|||||||||||||||
Total revenue
|
|
|
|
|
|
|||||||||||||||
|
||||||||||||||||||||
Operating income (loss)
|
|
|
|
(
|
)
|
|
||||||||||||||
Interest expense
|
|
|
|
|
|
|||||||||||||||
Earnings (loss) before income taxes
|
|
|
|
(
|
)
|
|
||||||||||||||
|
||||||||||||||||||||
Assets
|
|
|
|
|
|
|||||||||||||||
Capital expenditures
|
|
|
|
|
|
|||||||||||||||
Depreciation and amortization
|
|
|
|
|
|
|||||||||||||||
|
||||||||||||||||||||
2021:
|
||||||||||||||||||||
Revenue from external customers
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Intersegment revenue
|
|
|
|
|
|
|||||||||||||||
Total revenue
|
|
|
|
|
|
|||||||||||||||
|
||||||||||||||||||||
Operating income (loss)
|
|
|
|
(
|
)
|
|
||||||||||||||
Interest expense
|
|
|
|
|
|
|||||||||||||||
Earnings (loss) before income taxes
|
|
|
|
(
|
)
|
|
||||||||||||||
|
||||||||||||||||||||
Assets
|
|
|
|
|
|
|||||||||||||||
Capital expenditures
|
|
|
|
|
|
|||||||||||||||
Depreciation and amortization
|
|
|
|
|
|
|||||||||||||||
|
||||||||||||||||||||
2020:
|
||||||||||||||||||||
Revenue from external customers
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Intersegment revenue
|
|
|
|
|
|
|||||||||||||||
Total revenue
|
|
|
|
|
|
|||||||||||||||
|
||||||||||||||||||||
Operating income (loss)
|
|
|
|
(
|
)
|
|
||||||||||||||
Interest expense
|
|
|
|
|
|
|||||||||||||||
Earnings (loss) before income taxes
|
|
|
|
(
|
)
|
|
||||||||||||||
|
||||||||||||||||||||
Assets
|
|
|
|
|
|
|||||||||||||||
Capital expenditures
|
|
|
|
|
|
|||||||||||||||
Depreciation and amortization
|
|
|
|
|
|
(In thousands)
|
Flavors &
Extracts
|
Color
|
Asia Pacific
|
Corporate
& Other
|
Consolidated
|
|||||||||||||||
2022:
|
||||||||||||||||||||
Revenue from external customers:
|
||||||||||||||||||||
North America
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Europe
|
|
|
|
|
|
|||||||||||||||
Asia Pacific
|
|
|
|
|
|
|||||||||||||||
Other
|
|
|
|
|
|
|||||||||||||||
Total revenue from external customers
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Long-lived assets:
|
||||||||||||||||||||
North America
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Europe
|
|
|
|
|
|
|||||||||||||||
Asia Pacific
|
|
|
|
|
|
|||||||||||||||
Other
|
|
|
|
|
|
|||||||||||||||
Total long-lived assets
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
|
||||||||||||||||||||
2021:
|
||||||||||||||||||||
Revenue from external customers:
|
||||||||||||||||||||
North America
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Europe
|
|
|
|
|
|
|||||||||||||||
Asia Pacific
|
|
|
|
|
|
|||||||||||||||
Other
|
|
|
|
|
|
|||||||||||||||
Total revenue from external customers
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Long-lived assets:
|
||||||||||||||||||||
North America
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Europe
|
|
|
|
|
|
|||||||||||||||
Asia Pacific
|
|
|
|
|
|
|||||||||||||||
Other
|
|
|
|
|
|
|||||||||||||||
Total long-lived assets
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
|
||||||||||||||||||||
2020:
|
||||||||||||||||||||
Revenue from external customers:
|
||||||||||||||||||||
North America
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Europe
|
|
|
|
|
|
|||||||||||||||
Asia Pacific
|
|
|
|
|
|
|||||||||||||||
Other
|
|
|
|
|
|
|||||||||||||||
Total revenue from external customers
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Long-lived assets:
|
||||||||||||||||||||
North America
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Europe
|
|
|
|
|
|
|||||||||||||||
Asia Pacific
|
|
|
|
|
|
|||||||||||||||
Other
|
|
|
|
|
|
|||||||||||||||
Total long-lived assets
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
(In thousands)
|
Flavors &
Extracts
|
Color
|
Asia Pacific
|
Consolidated
|
||||||||||||
2022:
|
||||||||||||||||
Flavors, Extracts & Flavor Ingredients
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Natural Ingredients
|
|
|
|
|
||||||||||||
Food & Pharmaceutical Colors
|
|
|
|
|
||||||||||||
Personal Care
|
|
|
|
|
||||||||||||
Inks
|
|
|
|
|
||||||||||||
Asia Pacific
|
|
|
|
|
||||||||||||
Intersegment Revenue
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Total revenue from external customers
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
2021:
|
||||||||||||||||
Flavors, Extracts & Flavor Ingredients
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Natural Ingredients
|
|
|
|
|
||||||||||||
Fragrances
|
|
|
|
|
||||||||||||
Yogurt Fruit Preparations
|
|
|
|
|
||||||||||||
Food & Pharmaceutical Colors
|
|
|
|
|
||||||||||||
Personal Care
|
|
|
|
|
||||||||||||
Inks
|
|
|
|
|
||||||||||||
Asia Pacific
|
|
|
|
|
||||||||||||
Intersegment Revenue
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Total revenue from external customers
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
2020:
|
||||||||||||||||
Flavors, Extracts & Flavor Ingredients
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Natural Ingredients
|
|
|
|
|
||||||||||||
Fragrances
|
|
|
|
|
||||||||||||
Yogurt Fruit Preparations
|
|
|
|
|
||||||||||||
Food & Pharmaceutical Colors
|
|
|
|
|
||||||||||||
Personal Care
|
|
|
|
|
||||||||||||
Inks
|
|
|
|
|
||||||||||||
Asia Pacific
|
|
|
|
|
||||||||||||
Intersegment Revenue
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Total revenue from external customers
|
$
|
|
$
|
|
$
|
|
$
|
|
(In thousands)
|
Yogurt Fruit
Preparations
|
Fragrances
|
Inks
|
Corporate/
Other
|
Consolidated
|
|||||||||||||||
Non-cash impairment charges – Selling and administrative expenses
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
$
|
|
|||||||||
Non-cash charges – Cost of products sold
|
|
|
(
|
)
|
|
|
||||||||||||||
Reclassification of foreign currency translation and related items – Selling and administrative expenses
|
|
|
|
|
|
|||||||||||||||
Other costs - Selling and administrative expenses(1)
|
|
|
(
|
)
|
|
|
||||||||||||||
Total
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
|
|
(1) |
|
(In thousands)
|
Yogurt Fruit
Preparations
|
Fragrances
|
Inks
|
Corporate/
Other
|
Consolidated
|
|||||||||||||||
Non-cash impairment charges – Selling and administrative expenses
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||||
Non-cash charges – Cost of products sold
|
|
|
(
|
)
|
|
|
||||||||||||||
Reclassification of foreign currency translation and related items – Selling and administrative expenses
|
|
|
(
|
)
|
|
(
|
)
|
|||||||||||||
Other costs - Selling and administrative expenses(1)
|
|
|
|
|
|
|||||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
|
(1) |
|
(In thousands)
|
Flavors &
Extracts
|
Color
|
Asia
Pacific
|
Consolidated
|
||||||||||||
Employee separation
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
||||
Other income(1)
|
|
(
|
)
|
|
(
|
)
|
||||||||||
Other costs(2)
|
|
|
|
|
||||||||||||
Total
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
(1) |
|
(2) |
|
(In thousands)
|
Flavors &
Extracts
|
Color
|
Asia
Pacific
|
Consolidated
|
||||||||||||
Employee separation
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Other costs(1)
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
(1) |
|
(In thousands)
|
Selling and
Administrative
Expenses
|
Cost of
Products
Sold
|
Consolidated
|
|||||||||
Employee separation
|
$
|
|
$
|
|
$
|
|
||||||
Other costs(1)
|
|
|
|
|||||||||
Total
|
$
|
|
$
|
|
$
|
|
(1) |
|
|
Income Taxes--Valuation Allowances for Deferred Tax Assets
|
Description of the Matter |
As described in Note 11 to the consolidated financial statements, at December 31, 2022, the Company had gross deferred tax assets of $99.6 million, $60.1 million of which relate to net operating losses (NOLs), foreign tax
credits and other tax credits reduced by a $28.1 million valuation allowance. Deferred tax assets are reduced by a valuation allowance if, based upon the weight of all available evidence, it is more likely than not that some
portion, or all, of the deferred tax assets will not be realized.
Management’s analysis of the realizability of its deferred tax assets related to NOLs, foreign tax credits and other tax credits was significant to our audit because the amounts are material to
the financial statements and the assessment process related to the realizability of these deferred tax assets is complex, and involves significant judgments that include projections of income, sources of income and tax planning
strategies.
|
How We
Addressed the
Matter in Our
Audit
|
We tested controls relating to the realizability of deferred tax assets, including controls over management’s projections of future taxable income, the future reversal of existing taxable temporary differences and management’s
identification and use of available tax planning strategies.
To test management’s assessment of the realizability of its deferred tax assets related to NOLs, foreign and other tax credits, our audit procedures included, among others, evaluation of the assumptions used by the Company to
develop tax planning strategies and projections of future taxable income by jurisdiction and testing the completeness and accuracy of the underlying data used in its projections. We involved our tax professionals to evaluate the
application of tax law in the Company’s available tax planning strategies and projections of future taxable income. We assessed the historical accuracy of management’s projections and reconciled the projections of future taxable
income with other forecasted financial information prepared by the Company. We also tested the Company’s scheduling of the reversal of existing temporary taxable differences.
|
Item 9. |
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
|
Item 9A. |
Controls and Procedures.
|
Item 9B. |
Other Information.
|
Item 9C. |
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.
|
Item 10. |
Directors, Executive Officers of the Registrant, and Corporate Governance.
|
Item 11. |
Executive Compensation.
|
Item 12. |
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
|
Item 13. |
Certain Relationships and Related Transactions and Director Independence.
|
Item 14. |
Principal Accountant Fees and Services.
|
30
|
||
28
|
||
29
|
||
32
|
||
31
|
||
33-53
|
||
54-55
|
Exhibit
Number
|
Description
|
Incorporated by
Reference from
|
Filed
Herewith
|
|||
Sensient Technologies Corporation Amended and Restated Articles of Incorporation
|
Exhibit 3.1 to Current Report on Form 8-K dated July 24, 2017 (Commission File No. 1-7626)
|
|||||
Sensient Technologies Corporation Amended and Restated By-Laws
|
Exhibit 3.1 to Current Report on Form 8-K filed February 14, 2023 (Commission File No. 1-7626)
|
|||||
Note Purchase Agreement dated as of April 5, 2013
|
Exhibit 10.1 to Current Report on Form 8-K dated April 5, 2013 (Commission File No. 1-7626)
|
|||||
First Amendment dated as of November 6, 2015 to Note Purchase Agreement dated as of April 5, 2013
|
Exhibit 10.3 to Current Report on Form 8-K dated November 6, 2015 (Commission File No. 1-7626)
|
|||||
Second Amendment dated as of May 3, 2017 to Note Purchase Agreement dated as of April 5, 2013
|
Exhibit 10.4 to Current Report on Form 8-K dated May 5, 2017 (Commission File No. 1-7626)
|
|||||
Third Amendment dated as of June 22, 2018 to Note Purchase Agreement dated as of April 5, 2013
|
Exhibit 4.2(d) to Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 (Commission File No. 1-7626)
|
Fourth Amendment dated as of May 6, 2021 to Note Purchase Agreement dated as of April 5, 2013 | Exhibit 4.1 to Current Report on Form 8-K filed May 11, 2021 (Commission File No. 1-7626) | |||||
Note Purchase Agreement dated as of May 3, 2017
|
Exhibit 10.2 to Current Report on Form 8-K dated May 5, 2017 (Commission File No. 1-7626)
|
|||||
First Amendment dated as of June 22, 2018 to Note Purchase Agreement dated as of May 3, 2017
|
Exhibit 4.4(b) to Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 (Commission File No. 1-7626)
|
|||||
Second Amendment dated as of May 6, 2021 to Note Purchase Agreement dated as of May 3, 2017
|
Exhibit 4.3 to Current Report on Form 8-K filed May 11, 2021 (Commission File No. 1-7626)
|
|||||
Note Purchase Agreement dated as of November 1, 2018
|
Exhibit 10.1 to Current Report on Form 8-K dated November 1, 2018 (Commission File No. 1-7626)
|
|||||
First Amendment dated as of May 6, 2021 to Note Purchase Agreement dated as of November 1, 2018
|
Exhibit 4.4 to Current Report on Form 8-K filed May 11, 2021 (Commission File No. 1-7626)
|
|||||
Description of Sensient Technologies Corporation’s securities registered pursuant to Section 12 of the Securities Exchange Act
|
Exhibit 4.5 to Annual Report on Form 10-K for the fiscal year ended December 31, 2019 (Commission File No. 1-7626)
|
|||||
10
|
Material Contracts
|
|||||
10.1
|
Management Contracts or Compensatory Plans
|
|||||
Executive Employment Contract dated as of February 13, 2020, between Sensient Technologies Corporation and Paul Manning
|
Exhibit 10.1 to Current Report on Form 8-K dated February 13, 2020 (Commission File No. 1-7626)
|
|||||
Form of Change of Control Employment and Severance Agreement
|
Exhibit 10.1(b)(3) to Annual Report on Form 10-K for the fiscal year ended December 31, 2011 (Commission File No. 1-7626)
|
|||||
Sensient Technologies Corporation 2012 Non-Employee Directors Stock Plan
|
Exhibit 10.1(c)(2) to Annual Report on Form 10-K for the fiscal year ended December 31, 2014 (Commission File No. 1-7626)
|
|||||
Sensient Technologies Corporation Directors’ Deferred Compensation Plan
|
Exhibit 10.1 to Current Report on Form 8-K dated May 28, 2014 (Commission File No. 1-7626)
|
|||||
Sensient Technologies Corporation Non-Employee Directors’ Retirement Plan
|
Exhibit 10.2 to Current Report on Form 8-K dated July 25, 2013 (Commission File No. 1-7626)
|
|||||
Sensient Technologies Corporation Frozen Management Income Deferral Plan
|
Exhibit 10.5(a) to Quarterly Report on Form 10-Q for the quarter ended September 30, 2008 (Commission File No. 1-7626)
|
|||||
Sensient Technologies Corporation Management Income Deferral Plan
|
Exhibit 10.5(b) to Quarterly Report on Form 10-Q for the quarter ended September 30, 2008 (Commission File No. 1-7626)
|
|||||
Sensient Technologies Corporation Frozen Executive Income Deferral Plan
|
Exhibit 10.4(a) to Quarterly Report on Form 10-Q for the quarter ended September 30, 2008 (Commission File No. 1-7626)
|
Sensient Technologies Corporation Executive Income Deferral Plan
|
Exhibit 10.4(b) to Quarterly Report on Form 10-Q for the quarter ended September 30, 2008 (Commission File No. 1-7626)
|
|||||
Amended and Restated Sensient Technologies Corporation Rabbi Trust “A” Agreement dated November 30, 2009, between Sensient Technologies Corporation and Wells Fargo Bank, N.A.
|
Exhibit 10.1(l) to Annual Report on Form 10-K for the fiscal year ended December 31, 2009 (Commission File No. 1-7626)
|
|||||
Amended and Restated Sensient Technologies Corporation Rabbi Trust “B” Agreement dated November 30, 2009, between Sensient Technologies Corporation and Wells Fargo Bank, N.A.
|
Exhibit 10.1(m) to Annual Report on Form 10-K for the fiscal year ended December 31, 2009 (Commission File No. 1-7626)
|
|||||
Amendment No. 1 to the Amended and Restated Sensient Technologies Corporation Rabbi Trust “B” Agreement
|
Exhibit 10.1(m)(2) to Quarterly Report on Form 10-Q for the quarter ended June 30, 2017 (Commission File No. 1-7626)
|
|||||
Amended and Restated Sensient Technologies Corporation Rabbi Trust “C” Agreement dated November 30, 2009, between Sensient Technologies Corporation and Wells Fargo Bank, N.A.
|
Exhibit 10.1(n) to Annual Report on Form 10-K for the fiscal year ended December 31, 2009 (Commission File No. 1-7626)
|
|||||
Sensient Technologies Corporation Form of Supplemental Executive Retirement Plan A Agreement
|
Exhibit 10.1(s) to Annual Report on Form 10-K for the fiscal year ended December 31, 2008 (Commission File No. 1-7626)
|
|||||
10.1(k)(2) | Form of Amendment No. 1 to the Sensient Technologies Corporation Amended and Restated Supplemental Executive Retirement Plan A | Exhibit 10.1(s)(2) to Annual Report on Form 10-K for the fiscal year ended December 31, 2010 (Commission file No. 1-7626) | ||||
10.1(k)(3) | Form of Amendment No. 2 to the Sensient Technologies Corporation Amended and Restated Supplemental Executive Retirement Plan A | Exhibit 10.1 to Current Report on Form 8-K dated April 22, 2010 (Commission File No. 1-7626) | ||||
10.1(l)(1) | Sensient Technologies Corporation Form of Supplemental Executive Retirement Plan B Agreement | Exhibit 10.1(t) to Annual Report on Form 10-K for the fiscal year ended December 31, 2008 (Commission File No. 1-7626) | ||||
10.1(l)(2) | Form of Amendment No. 1 to the Sensient Technologies Corporation Amended and Restated Supplemental Executive Retirement Plan B | Exhibit 10.1(t)(2) to Annual Report on Form 10-K for the fiscal year ended December 31, 2010 (Commission File No. 1-7626) | ||||
10.1(l)(3) | Form of Amendment No. 2 to the Sensient Technologies Corporation Amended and Restated Supplemental Executive Retirement Plan B | Exhibit 10.2 to Current Report on Form 8-K dated April 22, 2010 (Commission File No. 1-7626) |
Sensient Technologies Frozen Supplemental Benefit Plan
|
Exhibit 10.6(a) to Quarterly Report on Form 10-Q for the quarter ended September 30, 2008 (Commission File No. 1-7626)
|
|||||
Sensient Technologies Supplemental Benefit Plan
|
Exhibit 10.6(b) to Quarterly Report on Form 10-Q for the quarter ended September 30, 2008 (Commission File No. 1-7626)
|
|||||
Sensient Technologies Corporation Policy on Recovery of Incentive Compensation from Executives
|
Exhibit 10.1 to Current Report on Form 8-K dated December 8, 2011 (Commission File No. 1-7626)
|
|||||
Form of Performance Stock Unit Agreement
|
Exhibit 10.3 to Current Report on Form 8-K dated May 28, 2014 (Commission File No. 1-7626)
|
|||||
Form of Restricted Stock Agreement
|
Exhibit 10.1 to Current Report on Form 8-K dated December 10, 2020 (Commission File No. 1-7626)
|
|||||
Form of Restricted Stock Unit Agreement
|
Exhibit 10.2 to Current Report on Form 8-K dated December 10, 2020 (Commission File No. 1-7626)
|
|||||
Sensient Technologies Corporation 2017 Stock Plan, as amended and restated
|
Appendix B to Definitive Proxy Statement filed on Schedule 14A on March 16, 2022 (Commission File No. 1-7626)
|
|||||
Sensient Technologies Management Incentive Compensation Plan, as amended on February 10, 2022
|
Exhibit 10.1(q) to Annual Report on Form 10-K for the fiscal year ended December 31, 2021 (Commission File No. 1-7626)
|
|||||
Third Amended and Restated Credit Agreement dated as of May 5, 2021
|
Exhibit 10.1 to Current Report on Form 8-K filed May 11, 2021 (Commission File No. 1-7626)
|
|||||
First Amendment to the Third Amended and Restated Credit Agreement, dated as of December 14, 2022
|
Exhibit 10.1 to Current Report on Form 8-K filed December 20, 2022 (Commission File No. 1-7626)
|
|||||
Receivables Sale Agreement dated as of October 3, 2016
|
Exhibit 10.1 to Current Report on Form 8-K dated October 3, 2016 (Commission File No. 1-7626)
|
|||||
Amendment No. 1 to the Receivables Sale Agreement, dated as of October 2, 2017
|
Exhibit 10.1 to Current Report on Form 8-K dated October 2, 2017 (Commission File No. 1-7626)
|
|||||
Receivables Purchase Agreement dated as of October 3, 2016
|
Exhibit 10.2 to Current Report on Form 8-K dated October 3, 2016 (Commission File No. 1-7626)
|
|||||
Amendment No. 1 to the Receivables Purchase Agreement and Performance Undertaking, dated as of October 2, 2017
|
Exhibit 10.2 to Current Report on Form 8-K dated October 2, 2017 (Commission File No. 1-7626)
|
Amendment No. 2 to Receivables Purchase Agreement, dated as of June 26, 2018
|
Exhibit 10.5(c) to Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 (Commission File No. 1-7626)
|
|||||
Amendment No. 3 to Receivables Purchase Agreement, dated as of October 1, 2018
|
Exhibit 10.1 to Current Report on Form 8-K dated October 1, 2018 (Commission File No. 1-7626)
|
|||||
Amendment No. 4 to Receivables Purchase Agreement, dated as of October 1, 2019
|
Exhibit 10.1 to Current Report on Form 8-K dated October 7, 2019 (Commission File No. 1-7626)
|
|||||
Amendment No. 5 to Receivables Purchase Agreement, dated as of October 1, 2020
|
Exhibit 10.1 to Current Report on Form 8-K dated October 1, 2020 (Commission File No. 1-7626)
|
|||||
Amendment No. 6 to Receivables Purchase Agreement, dated as of November 12, 2020
|
Exhibit 10.4(g) to Annual Report on Form 10-K for the fiscal year ended December 31, 2020 (Commission File No. 1-7626)
|
|||||
Amendment No. 7 to Receivables Purchase Agreement, dated as of October 1, 2021
|
Exhibit 10.1 to Current Report on Form 8-K filed October 5, 2021 (Commission File No. 1-7626)
|
|||||
Amendment No. 8 to Receivables Purchase Agreement, dated as of February 28, 2022
|
Exhibit 10.1 to Current Report on Form 8-K filed March 4, 2022 (Commission File No. 1-7626)
|
|||||
Amendment No. 9 to Receivables Purchase Agreement, dated as of August 31, 2022
|
Exhibit 10.1 to Current Report on Form 8-K filed September 6, 2022 (Commission File No. 1-7626)
|
|||||
Performance Undertaking made as of October 3, 2016
|
Exhibit 10.3 to Current Report on Form 8-K dated October 3, 2016 (Commission File No. 1-7626)
|
|||||
Loan Agreement dated as of November 7, 2022
|
Exhibit 10.1 to Current Report on Form 8-K filed November 8, 2022 (Commission File No. 1-7626)
|
|||||
Subsidiaries of the Registrant
|
X
|
|||||
Consent of Ernst & Young LLP
|
X
|
|||||
Certifications of Sensient’s President and Chief Executive Officer and Senior Vice President and Chief Financial Officer, pursuant to Rule 13a-14(a) of the Exchange Act
|
X
|
|||||
Certifications of Sensient’s President and Chief Executive Officer and Senior Vice President and Chief Financial Officer, pursuant to 18 United States Code § 1350
|
X
|
|||||
101.INS*
|
Inline Instance Document
|
X
|
101.SCH*
|
Inline XBRL Taxonomy Extension Schema Document
|
X
|
||||
101.CAL*
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document
|
X
|
||||
101.DEF*
|
Inline XBRL Taxonomy Extension Definition Linkbase Document
|
X
|
||||
101.LAB*
|
Inline XBRL Taxonomy Extension Label Linkbase Document
|
X
|
||||
101.PRE*
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document
|
X
|
||||
104
|
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)
|
Valuation Accounts Deducted in the Balance Sheet From the Assets to Which They Apply
|
Balance
at Beginning
of Period
|
Additions
Charged to
Costs and
Expenses
|
Additions
Recorded
During
Acquisitions
|
Deductions
(A)
|
Balance at
End of
Period
|
|||||||||||||||
2020
Allowance for losses:
Trade accounts receivable
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
|
||||||||||||||||||||
2021
Allowance for losses:
Trade accounts receivable
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
|
||||||||||||||||||||
2022
Allowance for losses:
Trade accounts receivable
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
(A)
|
Item 16. |
Form 10-K Summary.
|
SENSIENT TECHNOLOGIES CORPORATION
|
|
/s/ John J. Manning
|
|
John J. Manning
|
|
Senior Vice President, General Counsel and Secretary
|
|
Dated: February 17, 2023
|
/s/ Paul Manning
|
/s/ Sharad P. Jain
|
Paul Manning
|
Sharad P. Jain
|
Chairman of the Board, President and
|
Director
|
Chief Executive Officer
|
|
/s/ Stephen J. Rolfs
|
/s/ Donald W. Landry
|
Stephen J. Rolfs
|
Donald W. Landry
|
Senior Vice President and
|
Director
|
Chief Financial Officer
|
|
/s/ Tobin Tornehl
|
/s/ Deborah McKeithan-Gebhardt
|
Tobin Tornehl
|
Deborah McKeithan-Gebhardt
|
Vice President, Controller and
|
Director
|
Chief Accounting Officer
|
|
/s/ Joseph Carleone
|
/s/ Scott Morrison
|
Joseph Carleone
|
Scott Morrison
|
Director
|
Director
|
/s/ Mario Ferruzzi
|
/s/ Elaine R. Wedral
|
Mario Ferruzzi
|
Elaine R. Wedral
|
Director
|
Director
|
/s/ Carol R. Jackson
|
/s/ Essie Whitelaw
|
Carol R. Jackson
|
Essie Whitelaw
|
Director
|
Director
|