10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2016

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 1-4858

INTERNATIONAL FLAVORS &

FRAGRANCES INC.

(Exact name of registrant as specified in its charter)

New York	13-1432060
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

521 West 57th Street, New York, N.Y. 10019-2960

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code (212) 765-5500

 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  þ    No   ¬

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  þ    No   ¬

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	þ	Accelerated filer	¬
Non-accelerated filer	¬	Smaller reporting company	¬

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     Yes   ¬ No  þ

Number of shares outstanding as of July 26, 2016: 79,591,844

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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

INTERNATIONAL FLAVORS & FRAGRANCES INC.

CONSOLIDATED BALANCE SHEET

(DOLLARS IN THOUSANDS)

(Unaudited)

	June 30, 2016			December 31, 2015
ASSETS
Current Assets:
Cash and cash equivalents	$	539,992		$	181,988
Trade receivables (net of allowances of $9,425 and $8,229, respectively)	621,164			537,896
Inventories: Raw materials	273,424			265,209
Work in process	19,320			17,450
Finished goods	291,745			289,388
Total Inventories	584,489			572,047
Prepaid expenses and other current assets	183,789			145,178
Total Current Assets	1,929,434			1,437,109
Property, plant and equipment, at cost	1,850,356			1,812,283
Accumulated depreciation	(1,113,003		)	(1,079,489		)
	737,353			732,794
Goodwill	940,544			941,389
Other intangible assets, net	288,837			306,004
Deferred income taxes	139,023			166,323
Other assets	119,437			118,391
Total Assets	$	4,154,628		$	3,702,010
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Bank borrowings and overdrafts and current portion of long-term debt	$	133,473		$	132,349
Accounts payable	255,143			285,501
Accrued payroll and bonus	49,053			48,843
Dividends payable	44,588			44,824
Other current liabilities	205,994			213,639
Total Current Liabilities	688,251			725,156
Long-term debt	1,357,684			935,373
Deferred gains	41,630			43,260
Retirement liabilities	244,223			242,383
Other liabilities	144,908			160,849
Total Other Liabilities	1,788,445			1,381,865
Commitments and Contingencies (Note 13)
Shareholders’ Equity:
Common stock 12 1/2¢ par value; authorized 500,000,000 shares; issued 115,858,190 shares as of June 30, 2016 and December 31, 2015 and outstanding 79,640,930 and 80,022,291 shares as of June 30, 2016 and December 31, 2015	14,470			14,470
Capital in excess of par value	140,355			140,802
Retained earnings	3,750,364			3,604,254
Accumulated other comprehensive loss	(608,310		)	(613,440		)
Treasury stock, at cost - 36,217,260 shares as of June 30, 2016 and 35,835,899 shares as of December 31, 2015	(1,623,007		)	(1,555,769		)
Total Shareholders’ Equity	1,673,872			1,590,317
Noncontrolling interest	4,060			4,672
Total Shareholders’ Equity including noncontrolling interest	1,677,932			1,594,989
Total Liabilities and Shareholders’ Equity	$	4,154,628		$	3,702,010

See Notes to Consolidated Financial Statements

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INTERNATIONAL FLAVORS & FRAGRANCES INC.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(AMOUNT IN THOUSANDS EXCEPT PER SHARE AMOUNTS)

(Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2016			2015			2016			2015
Net sales	$	793,478		$	767,541		$	1,576,789		$	1,542,448
Cost of goods sold	427,837			422,501			850,940			851,131
Gross profit	365,641			345,040			725,849			691,317
Research and development expenses	63,252			62,514			126,637			125,976
Selling and administrative expenses	132,784			131,023			256,327			250,018
Amortization of acquisition-related intangibles	5,130			3,040			11,191			4,880
Restructuring and other charges, net	—			(358		)	—			(170		)
Operating profit	164,475			148,821			331,694			310,613
Interest expense	15,060			11,407			27,539			22,502
Other (income) expense, net	(2,635		)	436			(2,792		)	(5,275		)
Income before taxes	152,050			136,978			306,947			293,386
Taxes on income	35,317			31,604			71,610			59,754
Net income	116,733			105,374			235,337			233,632
Other comprehensive income (loss), after tax:
Foreign currency translation adjustments	(4,689		)	17,557			9,389			(32,958		)
(Losses) gains on derivatives qualifying as hedges	800			(5,966		)	(9,392		)	6,117
Pension and postretirement net liability	2,578			5,476			5,133			11,023
Other comprehensive income (loss)	(1,311		)	17,067			5,130			(15,818		)
Total comprehensive income	$	115,422		$	122,441		$	240,467		$	217,814
Net income per share - basic	$	1.46		$	1.30		$	2.94		$	2.88
Net income per share - diluted	$	1.46		$	1.29		$	2.93		$	2.86
Average number of shares outstanding - basic	79,764			80,790			79,809			80,729
Average number of shares outstanding - diluted	80,040			81,192			80,141			81,201
Dividends declared per share	$	0.56		$	0.47		$	1.12		$	0.94

See Notes to Consolidated Financial Statements

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INTERNATIONAL FLAVORS & FRAGRANCES INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

(DOLLARS IN THOUSANDS)

(Unaudited)

	Six Months Ended June 30,
	2016			2015
Cash flows from operating activities:
Net income	$	235,337		$	233,632
Adjustments to reconcile to net cash provided by operating activities:
Depreciation and amortization	49,743			41,041
Deferred income taxes	16,543			17,891
(Gain) loss on disposal of assets	(2,910		)	14
Stock-based compensation	13,774			12,860
Pension contributions	(39,510		)	(57,493		)
Changes in assets and liabilities, net of acquisitions:
Trade receivables	(70,361		)	(92,329		)
Inventories	(7,271		)	(9,834		)
Accounts payable	(29,167		)	27,334
Accruals for incentive compensation	(2,001		)	(21,191		)
Other current payables and accrued expenses	18,800			21,305
Other assets	(1,346		)	(12,417		)
Other liabilities	(27,081		)	5,505
Net cash provided by operating activities	154,550			166,318
Cash flows from investing activities:
Cash paid for acquisitions, net of cash received	—			(188,835		)
Additions to property, plant and equipment	(43,236		)	(37,937		)
Proceeds from life insurance contracts	—			548
Maturity of net investment hedges	(641		)	9,735
Proceeds from disposal of assets	3,630			1,515
Net cash used in investing activities	(40,247		)	(214,974		)
Cash flows from financing activities:
Cash dividends paid to shareholders	(89,463		)	(75,927		)
Net change in revolving credit facility borrowings and overdrafts	(138,142		)	(30,283		)
Deferred financing costs	(4,796		)	—
Proceeds from issuance of long-term debt	555,559			86,162
Loss on pre-issuance hedges	(3,244		)	—
Proceeds from issuance of stock under stock plans	494			286
Excess tax benefits on stock-based payments	4,431			11,608
Purchase of treasury stock	(71,714		)	(38,813		)
Net cash provided by (used in) financing activities	253,125			(46,967		)
Effect of exchange rate changes on cash and cash equivalents	(9,424		)	(5,696		)
Net change in cash and cash equivalents	358,004			(101,319		)
Cash and cash equivalents at beginning of year	181,988			478,573
Cash and cash equivalents at end of period	$	539,992		$	377,254
Interest paid, net of amounts capitalized	$	24,971		$	23,827
Income taxes paid	$	52,719		$	46,071

See Notes to Consolidated Financial Statements

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Notes to Consolidated Financial Statements

Note 1. Consolidated Financial Statements:

Basis of Presentation

These interim statements and related management’s discussion and analysis should be read in conjunction with the Consolidated Financial Statements and the related notes and management’s discussion and analysis of results of operations, liquidity and capital resources included in our 2015 Annual Report on Form 10-K (“2015 Form 10-K”). These interim statements are unaudited. The year-end balance sheet data included in this Form 10-Q filing was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles in the United States of America. We have historically operated and continue to operate on a 52/53 week fiscal year ending on the Friday closest to the last day of the quarter. For ease of presentation, June 30 and December 31 are used consistently throughout this Form 10-Q and these interim financial statements and related notes to represent the period-end dates. For the 2016 and 2015 quarters, the actual closing dates were July 1, and July 3, respectively. The unaudited interim financial statements include all adjustments (consisting only of normal recurring adjustments) and accruals necessary in the judgment of management for a fair statement of the results for the periods presented. When used herein, the terms “IFF,” the “Company,” “we,” “us” and “our” mean International Flavors & Fragrances Inc. and its consolidated subsidiaries.

Reclassifications and Revisions

Certain prior year amounts have been reclassified and revised to conform with current year presentation.

The Consolidated Balance Sheet as of December 31, 2015, has been revised to properly reflect in-bound goods in transit. Accordingly, Inventory and Accounts payable decreased by $17.0 million. In addition, an adjustment has been made to two line items within net cash provided by operating activities for the 2015 Consolidated Statement of Cash Flows to reflect the previously recorded correction of a balance sheet classification associated with accounts payable and accruals. These adjustments were not material to the Consolidated Statement of Cash Flows.

Recent Accounting Pronouncements

In March 2016, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance which requires changes to several aspects of the accounting for share-based payment transactions, including the treatment of income tax consequences, classification of awards as either equity or liabilities, and classification of certain items on the statement of cash flows. This guidance will be effective for annual and interim periods beginning after December 15, 2016. Early adoption will be permitted for all entities. Among other changes, the standard requires that employee taxes paid when an employer withholds shares be presented in the Consolidated Statement of Cash Flows as a financing activity instead of an operating activity. The Company expects to adopt this change retroactively and that the impact on the Consolidated Statement of Cash Flows will be approximately $20-$25 million on an annual basis. The Company is currently evaluating the other changes required by the standard.

In February 2016, the FASB issued authoritative guidance which requires changes to the accounting for leases. The new guidance establishes a new lease accounting model, that, for all companies, requires entities to record assets and liabilities related to leases on the balance sheet for certain types of leases. The guidance will be effective for annual and interim periods beginning after December 31, 2018. Early adoption will be permitted for all entities. The Company expects the adoption of this guidance will result in significant increases to assets and liabilities on its Consolidated Balance Sheet and is still evaluating the impact on its Consolidated Statement of Comprehensive Income.

In September 2015, the FASB issued authoritative guidance relating to the adjustments made during the measurement period for items in a business combination. Specifically, the new guidance requires adjustments related to the finalization of estimates to be recorded in the period when they are determined and to provide certain additional disclosures. This guidance is effective for fiscal years beginning after December 15, 2015. The Company adopted this guidance during 2016 and the adoption did not have a significant impact on its consolidated financial statements.

In April 2015, the FASB issued authoritative guidance which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability. This guidance is effective for annual and interim periods beginning after December 15, 2015. The Company adopted this guidance retroactively in 2016 and accordingly has reclassified all debt issuance costs on long-term debt as a direct deduction from the carrying amount of the debt liability in the Consolidated Balance Sheet as of December 31, 2015. The adoption of this guidance did not have a significant impact on its consolidated financial statements.

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In May 2014, the FASB issued authoritative guidance to clarify the principles to be used to recognize revenue and made subsequent clarifications under the new requirements during May 2016. The guidance is applicable to all entities and is effective for annual and interim periods beginning after December 15, 2017. Adoption as of the original effective date is permitted. The Company is currently evaluating the impact that this new standard will have on its consolidated financial statements.

Accounts Receivable

The Company sells certain accounts receivable on a non-recourse basis to unrelated financial institutions under “factoring” agreements that are sponsored, solely and individually, by certain customers. The Company accounts for these transactions as sales of receivables, removes the receivables sold from its financial statements, and records cash proceeds when received by the Company. The beneficial impact on cash from operations from participating in these programs increased approximately $17.7 million for the six months ended June 30, 2016 compared to an increase of approximately $1.3 million for the six months ended June 30, 2015. The cost of participating in these programs was immaterial to our results in all periods.

Note 2. Net Income Per Share:

Net income per share is based on the weighted average number of shares outstanding. A reconciliation of the shares used in the computation of basic and diluted net income per share is as follows:

	Three Months Ended June 30,		Six Months Ended June 30,
(SHARES IN THOUSANDS)	2016	2015	2016	2015
Basic	79,764	80,790	79,809	80,729
Assumed dilution under stock plans	276	402	332	472
Diluted	80,040	81,192	80,141	81,201

An immaterial amount of stock-settled appreciation rights (“SSARs”) were excluded from the computation of diluted net income per share for the three and six months ended June 30, 2016. There were no stock options or SSARs excluded from the 2015 periods.

The Company has issued shares of purchased restricted common stock (“PRS”) which contain rights to nonforfeitable dividends while these shares are outstanding and thus are considered participating securities. Such securities are required to be included in the computation of basic and diluted earnings per share pursuant to the two-class method. The Company did not present the two-class method since the difference between basic and diluted net income per share for both unrestricted common shareholders and PRS shareholders was less than $0.01 per share for each period presented, and the number of PRS outstanding as of June 30, 2016 and 2015 was immaterial. Net income allocated to such PRS was $0.3 million and $0.5 million for the three months ended June 30, 2016 and 2015, respectively and $0.5 million and $1.1 million during the six months ended June 30, 2016 and 2015, respectively.

Note 3. Acquisitions:

2015 Activity

Lucas Meyer

During the third quarter of 2015, the Company completed the acquisition of 100% of the outstanding shares of Lucas Meyer Cosmetics, a business of Unipex Group ("Lucas Meyer"). The total shares acquired include shares effectively acquired pursuant to put and call option agreements. The acquisition was accounted for under the purchase method. Total consideration was approximately Euro 284.0 million ($312.1 million), including approximately $4.8 million of cash acquired. The Company paid Euro 282.1 million (approximately $309.9 million) for the acquisition, which was funded from existing resources, and recorded a liability of approximately Euro 2.0 million (approximately $2.2 million) for shares to be purchased under the put and call option agreements. The purchase price exceeded the fair value of existing net assets by approximately $290.1 million. The excess was allocated principally to identifiable intangible assets (approximately $156.4 million), goodwill (approximately $179.5 million) and approximately $38.1 million to deferred taxes. Goodwill represents the excess of the purchase price over the fair value of net assets acquired. Separately identifiable intangible assets are principally related to customer relationships, proprietary technology and patents. The intangible assets are being amortized over the following estimated useful lives: trade names and proprietary technology, 28 years; customer relationships, 23 years; patents, 11 years; and non-solicitation agreements, 3 years.

No pro forma financial information for 2016 is presented as the impact of the acquisition was immaterial to the Consolidated Statement of Comprehensive Income. During the second quarter of 2016, the purchase price allocation was

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updated, however, none of the changes were material to the consolidated financial statements. The purchase price allocation was completed during the second quarter of 2016.

Ottens Flavors

During the second quarter of 2015, the Company completed the acquisition of 100% of the outstanding shares of Henry H. Ottens Manufacturing Co., Inc. ("Ottens Flavors"). The acquisition was accounted for under the purchase method. The Company paid $198.9 million (including $10.4 million of cash acquired) for this acquisition, which was funded from existing resources. The purchase price allocation was completed during the fourth quarter of 2015. No pro forma financial information for 2016 is presented as the impact of the acquisition was not material to the consolidated financial statements.

Note 4. Restructuring and Other Charges, Net:

During the fourth quarter of 2015, the Company established a series of initiatives intended to streamline its management structure, simplify decision-making and accountability, better leverage and align its capabilities across the organization and improve efficiency of its global manufacturing and operations network. As a result, in the fourth quarter of 2015, the Company recorded a pre-tax charge of $7.6 million, included in restructuring and other charges, net, related to severance and related costs pertaining to approximately 150 positions that will be affected. During the second quarter of 2016, the Company made payments of $1.4 million and recorded accelerated depreciation expense of $0.3 million. The total cost of the plan is expected to be approximately $10.5 million with the remaining charges relating principally to accelerated depreciation. The Company expects the plan to be fully implemented in the second half of 2017.

Changes in employee-related restructuring liabilities during the six months ended June 30, 2016, were as follows:

(DOLLARS IN THOUSANDS)	Employee-Related Costs			Accelerated Depreciation			Total
Balance at December 31, 2015	$	7,882		$	—		$	7,882
Additional charges (reversals), net	—			283			283
Non-cash charges	—			(283		)	(283		)
Payments and other costs	(1,446		)	—			(1,446		)
Balance at June 30, 2016	$	6,436		$	—		$	6,436

Note 5. Goodwill and Other Intangible Assets, Net:

Goodwill

Movements in goodwill during 2016 were as follows:

(DOLLARS IN THOUSANDS)	Goodwill
Balance at December 31, 2015	$	941,389
Foreign exchange	3,229
Other	(4,074		)
Balance at June 30, 2016	$	940,544

The decrease reflected in Other above is the impact of finalizing the purchase price allocation of Lucas Meyer as disclosed in Note 3.

Other Intangible Assets

Other intangible assets, net consist of the following amounts:

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	June 30,			December 31,
(DOLLARS IN THOUSANDS)	2016			2015
Cost
Customer relationships	$	289,743		$	293,799
Trade names & patents	31,554			34,182
Technological know-how	111,808			112,393
Other	24,072			22,711
Total carrying value	457,177			463,085
Accumulated Amortization
Customer relationships	(74,061		)	(66,324		)
Trade names & patents	(11,272		)	(10,282		)
Technological know-how	(66,618		)	(65,258		)
Other	(16,389		)	(15,217		)
Total accumulated amortization	(168,340		)	(157,081		)
Other intangible assets, net	$	288,837		$	306,004

Amortization

Amortization expense was $5.1 million and $3.0 million for the three months ended June 30, 2016 and 2015, respectively and $11.2 million and $4.9 million for the six months ended June 30, 2016 and 2015, respectively. Annual amortization is expected to be $21.8 million for the full year 2016, $21.4 million for the year 2017, $21.2 million for the year 2018, $20.0 million for the year 2019, $19.3 million for the year 2020 and $15.1 million for the year 2021.

Note 6. Borrowings:

Debt consists of the following:

(DOLLARS IN THOUSANDS)	Rate		Maturities	June 30, 2016			December 31, 2015
Senior notes - 2006 (1)	6.14	%	2016	$	124,991		$	124,964
Senior notes - 2007 (1)	6.40	%	2017-27	499,618			499,618
Senior notes - 2013 (1)	3.20	%	2023	297,846			297,683
Euro Senior notes - 2016 (1)	1.75	%	2024	550,598			—
Credit facility	2.67	%	2019	—			131,196
Bank overdrafts and other				15,791			10,982
Deferred realized gains on interest rate swaps				2,313			3,279
				1,491,157			1,067,722
Less: Current portion of long-term debt				(133,473		)	(132,349		)
				$	1,357,684		$	935,373

⁽¹⁾ Amount is net of unamortized discount and debt issuance costs.

On March 14, 2016, the Company issued Euro 500.0 million face amount of 1.75% Senior Notes ("Euro Senior Notes - 2016") due 2024 at a discount of Euro 0.9 million. The Company received proceeds related to the issuance of these Euro Senior Notes - 2016 of Euro 496.0 million which was net of the Euro 0.9 million discount and Euro 3.1 million underwriting discount (recorded as deferred financing costs). In addition, the Company incurred $1.3 million of other deferred financing costs in connection with the debt issuance. In connection with the debt issuance, the Company entered into pre-issuance hedging transactions that were settled upon issuance of the debt and resulted in a loss of approximately $3.2 million as of June 30, 2016. The discount, deferred financing costs and pre-issuance hedge loss are being amortized as interest expense over the 8 year term of the debt. The Euro Senior Notes - 2016 bear interest at a rate of 1.75% per annum, with interest payable on March 14 of each year, commencing on March 14, 2017. The Euro Senior Notes - 2016 will mature on March 14, 2024.

Upon 30 days’ notice to holders of the Euro Senior Notes - 2016 , the Company may redeem the Euro Senior Notes - 2016 for cash in whole, at any time, or in part, from time to time, prior to maturity, at redemption prices that include accrued and unpaid interest and a make-whole premium, as specified in the indenture governing the Euro Senior Notes - 2016. However, no make-whole premium will be paid for redemptions of the Euro Senior Notes - 2016 on or after December 14, 2023. The indenture provides for customary events of default and contains certain negative covenants that limit the ability of

8

the Company and its subsidiaries to grant liens on assets, or to enter into sale-leaseback transactions. In addition, subject to certain limitations, in the event of the occurrence of both (1) a change of control of the Company and (2) a downgrade of the Euro Senior Notes - 2016 below investment grade rating by both Moody’s Investors Services, Inc. and Standard & Poor’s Ratings Services within a specified time period, the Company will be required to make an offer to repurchase the Notes at a price equal to 101% of the principal amount of the Euro Senior Notes - 2016, plus accrued and unpaid interest to the date of repurchase.

As discussed in Note 11, the Euro Senior Notes - 2016 have been designated as a hedge of the Company's net investment in certain subsidiaries.

On July 12, 2016, the Company made a payment of $125.0 million related to our Senior Notes - 2006.

Note 7. Income Taxes:

Uncertain Tax Positions

At June 30, 2016, the Company had $25.1 million of unrecognized tax benefits recorded in Other liabilities. If these unrecognized tax benefits were recognized, the effective tax rate would be affected.

At June 30, 2016, the Company had accrued interest and penalties of $0.9 million classified in Other liabilities.

As of June 30, 2016, the Company’s aggregate provisions for uncertain tax positions, including interest and penalties, was$26.0 million associated with various tax positions asserted in foreign jurisdictions, none of which is individually material.

The Company regularly repatriates a portion of current year earnings from select non–U.S. subsidiaries. No provision is made for additional taxes on undistributed earnings of subsidiary companies that are intended and planned to be indefinitely invested in such subsidiaries. We intend to, and have plans to, reinvest these earnings indefinitely in our foreign subsidiaries to fund local operations and/or capital projects.

The Company has ongoing income tax audits and legal proceedings which are at various stages of administrative or judicial review. In addition, the Company has open tax years with various taxing jurisdictions that range primarily from 2006 to 2015. Based on currently available information, we do not believe the ultimate outcome of any of these tax audits and other tax positions related to open tax years, when finalized, will have a material impact on our financial position.

The Company also has other ongoing tax audits and legal proceedings that relate to indirect taxes, such as value-added taxes, sales and use taxes and property taxes, which are discussed in Note 13.

Effective Tax Rate

The effective tax rate for the three months ended June 30, 2016 was 23.2% compared with 23.1% for the three months ended June 30, 2015. The quarter-over-quarter increase was largely due to higher loss provisions partially offset by lower cost of repatriation. The effective tax rate for the six months ended June 30, 2016 was 23.3% compared with 20.4% for the six months ended June 30, 2015. The year-over-year increase was primarily due to a benefit of $10.5 million recorded in the first quarter of 2015, as a result of favorable tax rulings in Spain and another jurisdiction for which reserves were previously recorded and higher loss provisions in 2016, partially offset by lower cost of repatriation in the 2016 period.

Note 8. Stock Compensation Plans:

The Company has various plans under which its officers, senior management, other key employees and directors may be granted equity-based awards. Equity awards outstanding under the plans include PRS, purchased restricted stock units, restricted stock units ("RSUs"), stock options, SSARs and Long-Term Incentive Plan awards; liability-based awards outstanding under the plans are cash-settled RSUs.

Stock-based compensation expense and related tax benefits were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Equity-based awards	$	7,844		$	7,473		$	13,774		$	12,860
Liability-based awards	1,739			666			2,332			2,573
Total stock-based compensation expense	9,583			8,139			16,106			15,433
Less: tax benefit	(2,816		)	(2,225		)	(4,789		)	(4,412		)
Total stock-based compensation expense, after tax	$	6,767		$	5,914		$	11,317		$	11,021

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Note 9. Segment Information:

The Company is organized into two operating segments: Flavors and Fragrances. These segments align with the internal structure of the Company used to manage these businesses. Performance of these operating segments is evaluated based on segment profit which is defined as operating profit before Restructuring and other charges, net, Global expenses (as discussed below) and certain non-recurring items, Interest expense, Other income (expense), net and Taxes on income.

The Global expenses caption below represents corporate and headquarters-related expenses which include legal, finance, human resources, certain incentive compensation expenses and other R&D and administrative expenses that are not allocated to individual operating segments.

Reportable segment information is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Net sales:
Flavors	$	379,504		$	372,478		$	752,012		$	749,586
Fragrances	413,974			395,063			824,777			792,862
Consolidated	$	793,478		$	767,541		$	1,576,789		$	1,542,448
Segment profit:
Flavors	$	90,337		$	84,015		$	182,151		$	176,743
Fragrances	87,596			79,924			176,833			161,522
Global expenses	(12,232		)	(8,629		)	(26,141		)	(20,194		)
Restructuring and other charges, net (1)	(182		)	358			(283		)	170
Acquisition and related costs (2)	(213		)	(6,566		)	(1,249		)	(7,066		)
Operational improvement initiative costs (3)	(831		)	(281		)	(1,099		)	(562		)
Spanish capital tax settlement (4)	—			—			1,482			—
Operating profit	164,475			148,821			331,694			310,613
Interest expense	(15,060		)	(11,407		)	(27,539		)	(22,502		)
Other income (expense)	2,635			(436		)	2,792			5,275
Income before taxes	$	152,050		$	136,978		$	306,947		$	293,386

(1) Restructuring and other charges, net relate to accelerated depreciation costs in Europe recorded in Cost of goods sold.

(2) Acquisition and related costs are associated with the 2015 acquisition of Lucas Meyer as discussed in Note 3, including inventory step-up charges related to the inventory acquired.

(3) Operational improvement initiative costs relate to accelerated depreciation and severance costs in Asia in the 2016 period and accelerated depreciation in the 2015 period.

(4) The Spanish capital tax settlement represents interest received from the Spanish government related to the reversal of the unfavorable ruling the Spanish capital tax case from 2002, which was reversed during the year ended December 31, 2015.

Net sales are attributed to individual regions based upon the destination of product delivery. Net sales related to the U.S. for the three months ended June 30, 2016 and 2015 were $185 million and $174 million, respectively and for the six months ended June 30, 2016 and 2015 were $365 million and $338 million, respectively. Net sales attributed to all foreign countries in total for the three months ended June 30, 2016 and 2015 were $608 million and $594 million, respectively and for the six months ended June 30, 2016 and 2015 were $1,212 million and $1,204 million, respectively. No country other than the U.S. had net sales in any period presented greater than 10% of total consolidated net sales.

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Note 10. Employee Benefits:

Pension and other defined contribution retirement plan expenses included the following components:

U.S. Plans	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Service cost for benefits earned	$	772		$	984		$	1,543		$	1,968
Interest cost on projected benefit obligation	6,006			5,954			12,013			11,907
Expected return on plan assets	(8,070		)	(8,083		)	(16,139		)	(16,165		)
Net amortization and deferrals	1,385			5,203			2,772			10,406
Net periodic benefit cost	93			4,058			189			8,116
Defined contribution and other retirement plans	2,211			2,093			4,612			4,228
Total expense	$	2,304		$	6,151		$	4,801		$	12,344
Non-U.S. Plans	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Service cost for benefits earned	$	3,863		$	4,102		$	7,638		$	8,485
Interest cost on projected benefit obligation	6,372			6,151			12,737			12,543
Expected return on plan assets	(11,985		)	(12,440		)	(23,934		)	(25,390		)
Net amortization and deferrals	3,286			3,314			6,550			6,801
Net periodic benefit cost	1,536			1,127			2,991			2,439
Defined contribution and other retirement plans	1,763			1,693			3,470			3,288
Total expense	$	3,299		$	2,820		$	6,461		$	5,727

The Company expects to contribute a total of approximately $30 million to its non-U.S. pension plans during 2016. During the six months ended June 30, 2016, $20.0 million of contributions were made to the qualified U.S. pension plans, $17.3 million of contributions were made to the non U.S. plans and $2.2 million of benefit payments were made with respect to the Company's non-qualified U.S. pension plan.

Expense recognized for postretirement benefits other than pensions included the following components:

	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Service cost for benefits earned	$	214		$	301		$	429		$	601
Interest cost on projected benefit obligation	787			1,082			1,574			2,164
Net amortization and deferrals	(1,355		)	(712		)	(2,710		)	(1,423		)
Total postretirement benefit (income) expense	$	(354	)	$	671		$	(707	)	$	1,342

The Company expects to contribute approximately $5 million to its postretirement benefits other than pension plans during 2016. In the six months ended June 30, 2016, $2.6 million of contributions were made.

Note 11. Financial Instruments:

Fair Value

Accounting guidance on fair value measurements specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions. These two types of inputs create the following fair value hierarchy:

• Level 1–Quoted prices for identical instruments in active markets.

• Level 2–Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets.

• Level 3–Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

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This hierarchy requires us to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. We determine the fair value of structured liabilities (where performance is linked to structured interest rates, inflation or currency risks) using the LIBOR swap curve and forward interest and exchange rates at period end. Such instruments are classified as Level 2 based on the observability of significant inputs to the model. We do not have any instruments classified as Level 1 or Level 3, other than those included in pension asset trusts as discussed in Note 13 of our 2015 Form 10-K.

These valuations take into consideration our credit risk and our counterparties’ credit risk. The estimated change in the fair value of these instruments due to such changes in our own credit risk (or instrument-specific credit risk) was immaterial as of June 30, 2016.

The amounts recorded in the balance sheet (carrying amount) and the estimated fair values of financial instruments at June 30, 2016 and December 31, 2015 consisted of the following:

	June 30, 2016				December 31, 2015
(DOLLARS IN THOUSANDS)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Cash and cash equivalents (1)	$	539,992	$	539,992	$	181,988	$	181,988
Credit facilities and bank overdrafts (2)	15,791		15,791		142,178		142,178
Long-term debt: (3)
Senior notes - 2006	124,991		125,225		124,964		127,717
Senior notes - 2007	499,618		578,590		499,618		563,855
Senior notes - 2013	297,846		312,847		297,683		290,830
Euro Senior notes - 2016	550,598		584,953		—		—

(1) The carrying amount of cash and cash equivalents approximates fair value due to the short maturity of those instruments.

(2) The carrying amount of our credit facilities and bank overdrafts approximates fair value as the interest rate is reset frequently based on current market rates as well as the short maturity of those instruments.

(3) The fair value of our long-term debt was calculated using discounted cash flows applying current interest rates and current credit spreads based on our own credit risk.

Derivatives

The Company periodically enters into foreign currency forward contracts with the objective of reducing exposure to cash flow volatility associated with our intercompany loans, foreign currency receivables and payables, and anticipated purchases of certain raw materials used in operations. These contracts generally involve the exchange of one currency for a second currency at a future date, have maturities not exceeding twelve months and are with counterparties which are major international financial institutions.

During the six months ended June 30, 2016 and the year ended December 31, 2015, the Company entered into several forward currency contracts which qualified as net investment hedges, in order to mitigate a portion of our net European investments from foreign currency risk. The effective portions of net investment hedges are recorded in Other comprehensive income (“OCI”) as a component of Foreign currency translation adjustments in the accompanying Consolidated Statement of Comprehensive Income. Realized gains (losses) are deferred in accumulated other comprehensive income ("AOCI") where they will remain until the net investments in our European subsidiaries are divested. The outstanding forward currency contracts have remaining maturities of approximately one year. Eight of these forward currency contracts matured during the six months ended June 30, 2016.

Subsequent to the issuance of the Euro Senior Notes - 2016 during the first quarter of 2016, the Company designated the debt as a hedge of a portion of its net European investments. Accordingly, the change in the value of the debt that is attributable to foreign exchange movements is recorded in OCI as a component of Foreign currency translation adjustments in the accompanying Consolidated Statement of Comprehensive Income.

During the six months ended June 30, 2016 and the year ended December 31, 2015, the Company entered into several forward currency contracts which qualified as cash flow hedges. The objective of these hedges is to protect against the currency risk associated with forecasted U.S. dollar (USD) denominated raw material purchases made by Euro (EUR) functional currency entities which result from changes in the EUR/USD exchange rate. The effective portions of cash flow hedges are

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recorded in OCI as a component of Gains/(losses) on derivatives qualifying as hedges in the accompanying Consolidated Statement of Comprehensive Income. Realized gains/(losses) in AOCI related to cash flow hedges of raw material purchases are recognized as a component of Cost of goods sold in the accompanying Consolidated Statement of Comprehensive Income in the same period as the related costs are recognized.

During 2015 and 2014, the Company entered into interest rate swap agreements that effectively converted the fixed rate on a portion of our long-term borrowings to a variable short-term rate based on the LIBOR plus an interest markup. These swaps are designated as fair value hedges. Amounts recognized in Interest expense were immaterial for the three and six months ended June 30, 2016.

During the first quarter of 2016, the Company entered into and terminated two Euro interest rate swap agreements to hedge the anticipated issuance of fixed-rate debt. These swaps were designated as cash flow hedges. The effective portions of cash flow hedges are recorded in OCI as a component of Losses on derivatives qualifying as hedges in the accompanying Consolidated Statement of Comprehensive Income. The Company incurred a loss of Euro 2.9 million ($3.2 million) due to the termination of these swaps. The loss will be amortized as interest expense over the life of the Euro Senior Notes - 2016 as discussed in Note 6.

The following table shows the notional amount of the Company’s derivative instruments outstanding as of June 30, 2016 and December 31, 2015:

(DOLLARS IN THOUSANDS)	June 30, 2016		December 31, 2015
Foreign currency contracts	$	805,900	$	573,200
Interest rate swaps	$	475,000	$	475,000

The following tables show the Company’s derivative instruments measured at fair value (Level 2 of the fair value hierarchy), as reflected in the Consolidated Balance Sheets as of June 30, 2016 and December 31, 2015:

	June 30, 2016
(DOLLARS IN THOUSANDS)	Fair Value of Derivatives Designated as Hedging Instruments		Fair Value of Derivatives Not Designated as Hedging Instruments		Total Fair Value
Derivative assets (a)
Foreign currency contracts	$	4,038	$	12,159	$	16,197
Interest rate swaps	4,341		—		4,341
	$	8,379	$	12,159	$	20,538
Derivative liabilities (b)
Foreign currency contracts	$	1,353	$	9,274	$	10,627
	$	1,353	$	9,274	$	10,627

	December 31, 2015
(DOLLARS IN THOUSANDS)	Fair Value of Derivatives Designated as Hedging Instruments		Fair Value of Derivatives Not Designated as Hedging Instruments		Total Fair Value
Derivative assets (a)
Foreign currency contracts	$	6,560	$	3,700	$	10,260
Interest rate swaps	1,210		—		1,210
	$	7,770	$	3,700	$	11,470
Derivative liabilities (b)
Foreign currency contracts	$	2,106	$	3,022	$	5,128

(a) Derivative assets are recorded to Prepaid expenses and other current assets in the Consolidated Balance Sheet.

(b) Derivative liabilities are recorded as Other current liabilities in the Consolidated Balance Sheet.

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The following table shows the effect of the Company’s derivative instruments which were not designated as hedging instruments in the Consolidated Statement of Comprehensive Income for the three and six months ended June 30, 2016 and 2015 (in thousands):

Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income on Derivative					Location of Gain (Loss) Recognized in Income on Derivative
	Three Months Ended June 30,
	2016			2015
Foreign currency contracts	$	1,395		$	371	Other (income) expense, net
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income on Derivative					Location of Gain (Loss) Recognized in Income on Derivative
	Six Months Ended June 30,
	2016			2015
Foreign currency contracts	$	(3,548	)	$	10,075	Other (income) expense, net

Most of these net gains (losses) offset any recognized gains (losses) arising from the revaluation of the related intercompany loans during the same respective periods.

The following table shows the effect of the Company’s derivative instruments designated as cash flow and net investment hedging instruments in the Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2016 and 2015 (in thousands):

	Amount of (Loss) Gain Recognized in OCI on Derivative (Effective Portion)						Location of (Loss) Gain Reclassified from AOCI into Income (Effective Portion)	Amount of (Loss) Gain Reclassified from Accumulated OCI into Income (Effective Portion)
	Three Months Ended June 30,							Three Months Ended June 30,
	2016			2015				2016			2015
Derivatives in Cash Flow Hedging Relationships:
Foreign currency contracts	$	612		$	(6,035	)	Cost of goods sold	$	2,736		$	3,561
Interest rate swaps (1)	171			69			Interest expense	(171		)	(69		)
Derivatives in Net Investment Hedging Relationships:
Foreign currency contracts	1,934			(1,030		)	N/A	—			—
Euro Senior notes - 2016	9,649			—			N/A	—			—
Total	$	12,366		$	(6,996	)		$	2,565		$	3,492
	Amount of (Loss) Gain Recognized in OCI on Derivative (Effective Portion)						Location of (Loss) Gain Reclassified from AOCI into Income (Effective Portion)	Amount of (Loss) Gain Reclassified from Accumulated OCI into Income (Effective Portion)
	Six Months Ended June 30,							Six Months Ended June 30,
	2016			2015				2016			2015
Derivatives in Cash Flow Hedging Relationships:
Foreign currency contracts	$	(6,391	)	$	5,979		Cost of goods sold	$	5,352		$	4,584
Interest rate swaps (1)	(3,001		)	138			Interest expense	(257		)	(138		)
Derivatives in Net Investment Hedging Relationships:
Foreign currency contracts	(470		)	3,531			N/A	—			—
Euro Senior notes - 2016	9,649			—			N/A	—			—
Total	$	(213	)	$	9,648			$	5,095		$	4,446

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(1) Interest rate swaps were entered into as pre-issuance hedges.

No ineffectiveness was experienced in the above noted cash flow or net investment hedges during the three and six months ended June 30, 2016 and 2015.

The Company expects that approximately $1.7 million (net of tax) of derivative losses included in AOCI at June 30, 2016, based on current market rates, will be reclassified into earnings within the next 12 months. The majority of this amount will vary due to fluctuations in foreign currency exchange rates.

Note 12. Accumulated Other Comprehensive Income (Loss):

The following tables present changes in the accumulated balances for each component of other comprehensive income, including current period other comprehensive income and reclassifications out of accumulated other comprehensive income:

	Foreign Currency Translation Adjustments			(Losses) Gains on Derivatives Qualifying as Hedges			Pension and Postretirement Liability Adjustment			Total
(DOLLARS IN THOUSANDS)
Accumulated other comprehensive (loss) income, net of tax, as of December 31, 2015	$	(297,499	)	$	9,401		$	(325,342	)	$	(613,440	)
OCI before reclassifications	9,389			(4,297		)	—			5,092
Amounts reclassified from AOCI	—			(5,095		)	5,133			38
Net current period other comprehensive income (loss)	9,389			(9,392		)	5,133			5,130
Accumulated other comprehensive (loss) income, net of tax, as of June 30, 2016	$	(288,110	)	$	9		$	(320,209	)	$	(608,310	)

	Foreign Currency Translation Adjustments			(Losses) Gains on Derivatives Qualifying as Hedges			Pension and Postretirement Liability Adjustment			Total
(DOLLARS IN THOUSANDS)
Accumulated other comprehensive (loss) income, net of tax, as of December 31, 2014	$	(173,342	)	$	12,371		$	(379,459	)	$	(540,430	)
OCI before reclassifications	(32,958		)	10,563			—			(22,395		)
Amounts reclassified from AOCI	—			(4,446		)	11,023			6,577
Net current period other comprehensive income (loss)	(32,958		)	6,117			11,023			(15,818		)
Accumulated other comprehensive (loss) income, net of tax, as of June 30, 2015	$	(206,300	)	$	18,488		$	(368,436	)	$	(556,248	)

The following table provides details about reclassifications out of accumulated other comprehensive income to the Consolidated Statement of Comprehensive Income:

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	Six Months Ended June 30, 2016			Six Months Ended June 30, 2015			Affected Line Item in the Consolidated Statement of Comprehensive  Income
(DOLLARS IN THOUSANDS)
(Losses) gains on derivatives qualifying as hedges
Foreign currency contracts	$	6,117		$	5,239		Cost of goods sold
Interest rate swaps	(257		)	(138		)	Interest expense
	(765		)	(655		)	Provision for income taxes
	$	5,095		$	4,446		Total, net of income taxes
(Losses) gains on pension and postretirement liability adjustments
Prior service cost	$	3,735		$	2,318		(a)
Actuarial losses	(10,347		)	(18,102		)	(a)
	1,479			4,761			Provision for income taxes
	$	(5,133	)	$	(11,023	)	Total, net of income taxes

(a) The amortization of prior service cost and actuarial loss is included in the computation of net periodic benefit cost. Refer to Note 14 of our 2015 Form 10-K for additional information regarding net periodic benefit cost.

Note 13. Commitments and Contingencies:

Guarantees and Letters of Credit

The Company has various bank guarantees and letters of credit which are available for use to support its ongoing business operations and to satisfy governmental requirements associated with pending litigation in various jurisdictions.

At June 30, 2016, we had total bank guarantees and standby letters of credit of approximately $38.4 million with various financial institutions. Included in the above aggregate amount is a total of $16.2 million in bank guarantees which the Company has posted for certain assessments in Brazil for other diverse income tax and indirect tax disputes related to fiscal years 1998-2011. There were no material amounts utilized under the standby letters of credit as of June 30, 2016.

In order to challenge the assessments in these cases in Brazil, the Company has been required to, and has separately pledged assets, principally property, plant and equipment, to cover assessments in the amount of approximately $13.4 million as of June 30, 2016.

Lines of Credit

The Company has various lines of credit which are available to support its ongoing business operations. At June 30, 2016, we had available lines of credit (in addition to the $950 million of capacity under the Credit Facility discussed in Note 8 of our 2015 Form 10-K) of approximately $76.6 million with various financial institutions. There were no significant amounts drawn down pursuant to these lines of credit as of June 30, 2016.

Litigation

The Company assesses contingencies related to litigation and/or other matters to determine the degree of probability and range of possible loss. A loss contingency is accrued in the Company’s consolidated financial statements if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Because litigation is inherently unpredictable and unfavorable resolutions could occur, assessing contingencies is highly sensitive and requires judgments about future events. On at least a quarterly basis, the Company reviews contingencies related to litigation to determine the adequacy of accruals. The amount of ultimate loss may differ from these estimates and further events may require the Company to increase or decrease the amounts it has accrued on any matter.

Periodically, we assess our insurance coverage for all known claims, where applicable, taking into account aggregate coverage by occurrence, limits of coverage, self-insured retentions and deductibles, historical claims experience and claims experience with our insurance carriers. The liabilities are recorded at management’s best estimate of the probable outcome of the lawsuits and claims, taking into consideration the facts and circumstances of the individual matters as well as past experience on similar matters. At each balance sheet date, the key issues that management assesses are whether it is probable that a loss as to asserted or unasserted claims has been incurred and if so, whether the amount of loss can be reasonably estimated. We record the expected liability with respect to claims in Other liabilities and expected recoveries from our

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insurance carriers in Other assets. We recognize a receivable when we believe that realization of the insurance receivable is probable under the terms of the insurance policies and our payment experience to date.

Environmental

Over the past 20 years, various federal and state authorities and private parties have claimed that we are a Potentially Responsible Party (“PRP”) as a generator of waste materials for alleged pollution at a number of waste sites operated by third parties located principally in New Jersey and have sought to recover costs incurred and to be incurred to clean up the sites.

We have been identified as a PRP at eight facilities operated by third parties at which investigation and/or remediation activities may be ongoing. We analyze our potential liability on at least a quarterly basis. We accrue for environmental liabilities when they are probable and estimable. We estimate our share of the total future cost for these sites to be less than $5 million.

While joint and several liability is authorized under federal and state environmental laws, we believe the amounts we have paid and anticipate paying in the future for clean-up costs and damages at all sites are not material and will not have a material adverse effect on our financial condition, results of operations or liquidity. This assessment is based upon, among other things, the involvement of other PRPs at most of the sites, the status of the proceedings, including various settlement agreements and consent decrees, and the extended time period over which payments will likely be made. There can be no assurance, however, that future events will not require us to materially increase the amounts we anticipate paying for clean-up costs and damages at these sites, and that such increased amounts will not have a material adverse effect on our financial condition, results of operations or cash flows.

China Facilities

Guangzhou Flavors plant

During 2015, the Company was notified by Chinese authorities of compliance issues pertaining to the emission of odors from several of its plants in China. As a result, the Company's Flavors facility in China was temporarily idled. Accordingly, the Company invested approximately $6.5 in odor-abatement equipment at these facilities to address these issues and is in the process of building a second Flavors site in China, which is expected to be completed during 2018.

If the Company is required to close a plant, or operate one at significantly reduced production levels on a permanent basis, the Company may be required to record charges that could have a material impact on its consolidated financial results of operations, financial position and cash flows in future periods.

Zhejiang Ingredients plant

The Company has received a request from the Chinese government to relocate its Fragrance Ingredients plant in Zhejiang, China. The Company is in discussions with the government regarding the timing of the requested relocation and the amount and nature of government compensation to be provided to the Company. The net book value of the current site approximates $25 million. Depending upon the ultimate outcome of these discussions with the Chinese government, between $0-25 million of the remaining net book value may be subject to accelerated depreciation.

Other Contingencies

The Company has contingencies involving third parties (such as labor, contract, technology or product-related claims or litigation) as well as government-related items in various jurisdictions in which we operate pertaining to such items as value-added taxes, other indirect taxes, customs and duties and sales and use taxes. It is possible that cash flows or results of operations, in any period, could be materially affected by the unfavorable resolution of one or more of these contingencies.

The most significant government-related contingencies exist in Brazil. With regard to the Brazilian matters, we believe we have valid defenses for the underlying positions under dispute; however, in order to pursue these defenses, we are required to, and have provided, bank guarantees and pledged assets in the aggregate amount of $29.6 million. The Brazilian matters take an extended period of time to proceed through the judicial process and there are a limited number of rulings to date.

In March 2012, ZoomEssence, Inc. filed a complaint against the Company in the U.S. District Court of New Jersey alleging trade secret misappropriation, breach of contract and unjust enrichment in connection with certain spray dry technology disclosed to the Company. In connection with the claims, ZoomEssence is seeking an injunction and monetary damages. ZoomEssence initially sought a temporary restraining order and preliminary injunction, but the Court denied these applications in an order entered on September 27, 2013, finding that ZoomEssence had not demonstrated a likelihood of success on the merits of its claims. The Court subsequently referred the matter to mediation, however the private mediation session did not result in a resolution of the dispute. On November 3, 2014, ZoomEssence amended its complaint against the Company to include allegations of breach of the duty of good faith and fair dealing, fraud in the inducement, and misappropriation of confidential and proprietary information. On November 13, 2014, the Company filed a counterclaim

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against ZoomEssence alleging trade secret misappropriation, breach of contract, breach of the implied covenant of good faith and fair dealing, unjust enrichment, misappropriation of confidential and proprietary information, common law unfair competition, tortious interference with contractual relations, and conversion. The case is currently proceeding through discovery with a trial on the merits anticipated in late 2016/early 2017. The Company denies the allegations and will vigorously defend and pursue its position in Court. At this stage of the litigation, based on the information currently available to the Company, management does not believe that this matter represents a material loss contingency.

Based on the information available as of June 30, 2016, we estimate a range of reasonably possible loss related to the matters above, collectively, is $0-$46 million.

Separately, the Spanish tax authorities alleged claims for a capital tax, the Appellate Court rejected one of the two bases upon which we based our capital tax position. On January 22, 2014, we filed an appeal and in order to avoid future interest costs in the event our appeal was unsuccessful, we paid Euro 9.8 million ($11.2 million, representing the principal amount) during the first quarter of 2014. On February 24, 2016, we received a favorable ruling on our appeal from the Spanish Supreme Court which overruled a lower court ruling. As a result of this decision, we have reversed the previously recorded provision of Euro 9.8 million ($10.5 million) for the year ended December 31, 2015. During the second quarter of 2016, we recorded additional income of $1.4 million related to the finalization of amounts expected to be received from the authorities. This amount has been reflected as a reduction of administrative expense.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

Company background

We create, manufacture and supply flavors and fragrances (including cosmetic active ingredients) that are used in the food, beverage, personal care and household products industries either in the form of compounds or individual ingredients, including cosmetic active ingredients. Our flavors and fragrance compounds combine a number of ingredients that are blended, mixed or reacted together to produce proprietary formulas created by our flavorists and perfumers.

Flavors are the key building blocks that impart taste experiences in food and beverage products and, as such, play a significant role in determining consumer preference of the end products in which they are used. As a leading creator of flavors, we help our customers deliver on the promise of delicious and healthy foods and drinks that appeal to consumers. While we are a global leader, our flavors business is more regional in nature, with different formulas that reflect local taste preferences. Our flavors compounds are ultimately used by our customers in four end-use categories: (1) Savory, (2) Beverages, (3) Sweet and (4) Dairy.

We are a global leader in the creation of fragrance compounds that are integral elements in the world’s finest perfumes and best-known consumer products, within fabric care, home care, personal wash, hair care and toiletries products. Our Fragrances business consists of Fragrance Compounds and Fragrance Ingredients. Our Fragrance Compounds are defined into two broad categories, (1) Fine Fragrances and (2) Consumer Fragrances. Consumer Fragrances consists of five end-use categories of products: (1) Fabric Care, (2) Home Care, (3) Personal Wash, (4) Hair Care and (5) Toiletries. In addition, Fragrance Ingredients, that are used internally and sold to third parties, including customers and competitors, for use in preparation of compounds, and cosmetic active ingredients, which consist of active and functional ingredients, are included in the Fragrances business unit.

The flavors and fragrances market is part of a larger market which supplies a wide variety of ingredients and compounds that are used in consumer products. The broader market includes large multinational companies or smaller regional and local participants which supply products such as seasonings, texturizers, spices, enzymes, certain food-related commodities, fortified products and cosmetic active ingredients. The global market for flavors and fragrances has expanded consistently, primarily as a result of an increase in demand for, as well as an increase in the variety of, consumer products containing flavors and fragrances. In 2014, the flavors and fragrances market, in which we compete, was estimated by management to be at least $18 billion and is forecasted to grow to approximately $21.6 billion by 2019, primarily driven by expected growth in emerging markets; however the exact size of the global market is not available due to fragmentation of data. We estimate the market size for cosmetic active ingredients to be approximately $1.5 billion as of 2015. We, together with the other top three companies, are estimated to represent approximately two-thirds of the total estimated sales in the global flavors and fragrances sub-segment of the broader market.

During the second quarter of 2015, we completed the acquisition of Ottens Flavors, and in the third quarter of 2015, we completed the acquisition of Lucas Meyer. The acquisitions did not have a material impact on our consolidated statement of comprehensive income either individually or in aggregate.

2016 Overview

Net sales during the second quarter of 2016 increased 3% on a reported basis and 4% on a currency neutral basis (which excludes the effects of changes in currency), with the effects of acquisitions contributing approximately 2% to both reported and currency neutral basis growth rates. The currency neutral growth of 4% reflects new win performance (net of losses) in Flavors and Fragrance Compounds in addition to strong growth in Fragrance Ingredients, driven by the impact of acquisitions and lower volume erosion on existing business in Fragrance Compounds.

Exchange rate fluctuations had a 100 basis point (bps) unfavorable impact on net sales for the second quarter, due to the strengthening of the U.S. dollar. The effect of exchange rates can vary by business and region, depending upon the mix of sales by destination country as well as the relative percentage of local sales priced in U.S. dollars versus local currencies.

Gross margins increased year-over-year to 46.1% in the second quarter of 2016 from 45.0% in the 2015 period driven primarily by volume growth, the benefits of productivity initiatives and the contribution of acquisitions. Included in the second quarter of 2016 was $1.0 million of restructuring costs and operational improvement initiative costs, compared to $1.1 million of costs associated with accelerated depreciation included in the second quarter of 2015. Excluding these items, gross margin increased 110 bps compared to the prior year period. The overall raw material cost base continues to be essentially benign. We believe that we will continue to see higher prices on certain categories (such as naturals including vanilla) that will be largely

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offset by benefits associated with oil-based derivatives that are expected to continue in 2016. We continue to seek improvements in our margins through operational performance, cost reduction efforts and mix enhancement.

FINANCIAL PERFORMANCE OVERVIEW

Sales

Reported sales in the second quarter of 2016 increased approximately 3%. In currency neutral terms, sales increased 4%, reflecting new win performance in both Flavors and Fragrance Compounds, lower volume erosion on existing business in Fragrance Compounds and the effect of acquisitions (which added approximately 2% to both reported and currency neutral basis amounts). We continue to benefit from our diverse portfolio of end-use product categories and geographies and had currency neutral growth in three of our four regions and all four of our end-use product categories. Flavors realized currency neutral growth of 3% for the second quarter of 2016, which was partially driven by the inclusion of acquisitions. Our Fragrance business achieved currency neutral growth of 5%, driven primarily by the inclusion of acquisitions. Fragrances growth principally reflects strong growth within Fragrance Ingredients, which was driven entirely by the inclusion of acquisitions. Overall, our second quarter 2016 results include 5% growth from developed markets and 3% growth from emerging markets which each represented 50% of currency neutral sales. From a geographic perspective, for the second quarter, North America (NOAM), Europe, Africa and the Middle East (EAME) and Greater Asia (GA) all delivered currency neutral growth in 2016, led by GA with 8%. Latin America (LA) sales declined 3% on a currency neutral basis.

Operating profit

Operating profit increased $15.6 million to $164.5 million (20.7% of sales) in the 2016second quarter compared to $148.8 million (19.4% of sales) in the comparable 2015 period. The second quarter of 2016 included $1.2 million of restructuring, acquisition-related, and operational improvement costs compared to $6.5 million of acquisition-related, restructuring and operational improvement initiative costs in the prior year period. Excluding these charges, adjusted operating profit increased to $165.7 million (20.9% of sales) for the second quarter of 2016 compared to $155.3 million (20.2% of sales) for the second quarter of 2015. Foreign currency changes did not have an impact on operating profit in the 2016 period, but had an unfavorable impact on operating profit of approximately 8% in the 2015 period versus the 2014 period.

Other (income) expense, net

Other (income) expense, net increased $3.0 million to $2.6 million of income in the second quarter of 2016 compared to $0.4 million of expense in the second quarter of 2015. The year-over-year increase is primarily driven by favorable year-over-year foreign exchange gains/(losses) in 2016.

Net income

Net income increased by $11.4 million quarter-over-quarter to $116.7 million for the second quarter of 2016, driven by the factors discussed above.

Cash flows

Cash flows from operations for the six months ended June 30, 2016 were $154.6 million or 9.8% of sales, compared to cash inflow from operations of $166.3 million or 10.8% of sales for the six months ended June 30, 2015. The decrease in cash flows from operations in 2016 was principally driven by increased core working capital levels (trade receivables, inventories and accounts payable) partially offset by lower pension contributions for the 2016 period as compared to the 2015 period.

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Results of Operations

	Three Months Ended June 30,								Six Months Ended June 30,
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)	2016			2015			Change		2016			2015			Change
Net sales	$	793,478		$	767,541		3	%	$	1,576,789		$	1,542,448		2	%
Cost of goods sold	427,837			422,501			1	%	850,940			851,131			—	%
Gross profit	365,641			345,040					725,849			691,317
Research and development (R&D) expenses	63,252			62,514			1	%	126,637			125,976			1	%
Selling and administrative (S&A) expenses	132,784			131,023			1	%	256,327			250,018			3	%
Amortization of acquisition-related intangibles	5,130			3,040			69	%	11,191			4,880			129	%
Restructuring and other charges, net	—			(358		)	(100	)%	—			(170		)	(100	)%
Operating profit	164,475			148,821					331,694			310,613
Interest expense	15,060			11,407			32	%	27,539			22,502			22	%
Other (income) expense	(2,635		)	436			(704	)%	(2,792		)	(5,275		)	(47	)%
Income before taxes	152,050			136,978					306,947			293,386
Taxes on income	35,317			31,604			12	%	71,610			59,754			20	%
Net income	$	116,733		$	105,374		11	%	$	235,337		$	233,632		1	%
Diluted EPS	$	1.46		$	1.29		13	%	$	2.93		$	2.86		2	%
Gross margin	46.1		%	45.0		%	110		46.0		%	44.8		%	120
R&D as a percentage of sales	8.0		%	8.1		%	(10	)	8.0		%	8.2		%	(20	)
S&A as a percentage of sales	16.7		%	17.1		%	(40	)	16.3		%	16.2		%	10
Operating margin	20.7		%	19.4		%	130		21.0		%	20.1		%	90
Adjusted operating margin (1)	20.9		%	20.2		%	70		21.1		%	20.6		%	50
Effective tax rate	23.2		%	23.1		%	10		23.3		%	20.4		%	290
Segment net sales
Flavors	$	379,504		$	372,478		2	%	$	752,012		$	749,586		—	%
Fragrances	413,974			395,063			5	%	824,777			792,862			4	%
Consolidated	$	793,478		$	767,541				$	1,576,789		$	1,542,448

(1) Adjusted operating margin excludes $1.2 million consisting of restructuring, acquisition-related and operational improvement costs for the three months ended June 30, 2016 and excludes $6.5 million acquisition-related, restructuring and operational improvement initiative costs for the three months ended June 30, 2015. For the six months ended June 30, 2016, adjusted operating margin excludes $1.1 million of restructuring, acquisition-related and operational improvement initiative costs which were partially offset by the benefit of the Spanish capital tax settlement compared to the exclusion of $7.5 million of Restructuring and other charges, net and operational improvement initiative costs during the comparable 2015 period.

Cost of goods sold includes the cost of materials and manufacturing expenses. R&D expenses relate to the development of new and improved products, technical product support and compliance with governmental regulations. S&A expenses include expenses necessary to support our commercial activities and administrative expenses supporting our overall operating activities.

SECOND QUARTER 2016 IN COMPARISON TO SECOND QUARTER 2015

Sales

Sales for the second quarter of 2016 totaled $793.5 million, an increase of 3% from the prior year quarter. On a currency neutral basis sales increased 4%, as a result of new win performance in both Flavors and Fragrance Compounds, in addition to strong growth in Fragrance Ingredients (driven by the impact of acquisitions) and lower volume erosion on existing business in Fragrance Compounds. On both a reported and currency neutral basis, the effect of acquisitions was approximately 2% to net sales amounts.

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Flavors Business Unit

Flavors reported sales increased 2% from the prior year period while currency neutral sales increased 3% during the second quarter of 2016 compared to the 2015 period, which reflects new win performance and was partially driven by the inclusion of acquisitions in both reported and currency neutral basis amounts. The currency neutral increase was due to low single-digit growth in all four end-use categories. The Flavors business delivered currency neutral growth in NOAM, EAME and GA, led by GA. Sales in GA were led by double-digit gains in Sweet and mid single-digit gains in Savory. EAME sales were driven by double-digit gains in Dairy and high single-digit gains in Beverage. Sales in NOAM were driven by high single-digit gains in Beverage. LA sales declines were driven by double-digit declines in Sweet and high single-digit declines in Beverage.

Fragrances Business Unit

The Fragrances business experienced an increase of 5% in both reported and currency neutral sales for the second quarter of 2016 compared to the second quarter of 2015. Acquisitions accounted for substantially all of the growth on a reported basis and accounted for approximately half of the growth on a currency neutral basis. The overall currency neutral increase was primarily driven by double-digit growth in Fragrance Ingredients, which is driven entirely by the inclusion of acquisitions, in addition to double-digit growth in Personal Wash and mid single-digit growth in Home Care and Hair Care categories. Excluding the effects of acquisitions, Fragrance Ingredients sales declined mid single-digits on a currency neutral basis.

Sales Performance by Region and Category

		% Change in Sales - Second Quarter 2016 vs. Second Quarter 2015
		Fine Fragrances		Consumer Fragrances		Ingredients		Total Frag.		Flavors		Total
NOAM	Reported	-5	%	8	%	17	%	7	%	4	%	5	%
EAME	Reported	-3	%	3	%	23	%	5	%	3	%	5	%
	Currency Neutral (1)	-5	%	1	%	21	%	3	%	4	%	4	%
LA	Reported	9	%	-5	%	-14	%	-3	%	-10	%	-5	%
	Currency Neutral (1)	15	%	-4	%	-14	%	-1	%	-7	%	-3	%
GA	Reported	0	%	10	%	9	%	9	%	4	%	6	%
	Currency Neutral (1)	1	%	11	%	8	%	11	%	6	%	8	%
Total	Reported	-1	%	4	%	15	%	5	%	2	%	3	%
	Currency Neutral (1)	-1	%	4	%	14	%	5	%	3	%	4	%

(1) Currency neutral sales growth is calculated by translating prior year sales at the exchange rates for the corresponding 2016 period.

• NOAM Flavors sales increased 4%, which included the impact of acquisitions contributing to high single-digit growth in Beverage and low single-digit growth in Sweet. NOAM Fragrance sales increased 7% in the second quarter of 2016, principally due to double-digit gains Fragrance Ingredients, which included the impact of acquisitions, Home Care, Fabric Care and Hair Care, which was partially offset by mid single-digit declines in Fine Fragrance.

• EAME Flavors currency neutral sales increased 4% primarily due to double-digit growth in Dairy, high single-digit growth in Beverage and mid to low single-digit growth in Sweet and Savory. EAME Fragrance currency neutral sales increased 3% overall, driven mainly by double-digit growth in Fragrance Ingredients, which included the impact of acquisitions, Hair Care and Home Care, which more than offset low single-digit declines in Fine Fragrance.

• LA Flavors currency neutral sales declined 7% driven by double-digit declines in Sweet and high single-digit declines in Beverage, which were only partially offset by mid single-digit growth in Savory and Dairy categories. LA Fragrances currency neutral sales decreased 1% overall, principally driven by double-digit declines in Fragrance Ingredients and Home Care as well as high single-digit declines in Fabric Care, which were only partially offset by double-digit growth in Fine Fragrance and Personal Wash.

• GA Flavors currency neutral sales increased 6% from the prior year period driven by double-digit growth in Sweet, mid single-digit growth in Savory and low single-digit gains in Beverage and Dairy. GA Fragrances currency neutral sales growth of 11% was principally driven by double-digit gains in Fabric Care and Personal Wash as well as high single-digit growth in Fragrance Ingredients, which included the impact of acquisitions.

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Cost of Goods Sold

Cost of goods sold, as a percentage of sales, decreased 110 bps to 53.9% in the second quarter of 2016 compared to 55.0% in the second quarter of 2015, principally driven by cost savings and productivity initiatives. Included in cost of goods sold was $1.0 million of restructuring, acquisition related and operational improvement costs in 2016 compared to $1.1 million of restructuring and operational improvement initiative costs in 2015.

Research and Development (R&D) Expenses

Overall R&D expenses, as a percentage of sales, decreased slightly compared to the prior year period at 8.0% in the second quarter of 2016 versus 8.1% in the second quarter of 2015.

Selling and Administrative (S&A) Expenses

S&A expenses increased $1.8 million to $132.8 million or 16.7%, as a percentage of sales, in the second quarter of 2016 compared to 17.1% in the second quarter of 2015. The $1.8 million increase was principally due to costs associated with S&A expenses of acquired entities which were partially offset by the impact of currency.

Amortization of Acquisition-Related Intangibles

Amortization expenses increased $2.1 million to $5.1 million in the second quarter of 2016 compared to $3.0 million in the second quarter of 2015. The $2.1 million increase was driven by the acquisitions of Ottens Flavors and Lucas Meyer in the second and third quarters of 2015, respectively.

Operating Results by Business Unit

We evaluate the performance of business units based on segment profit which is defined as operating profit before Restructuring and other charges, net, Global expenses (as discussed in Note 9 to the Consolidated Financial Statements) and certain non-recurring items, net, Interest expense, Other (expense) income, net and Taxes on income. See Note 9 to the Consolidated Financial Statements for the reconciliation to Income before taxes.

	Three Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015
Segment profit:
Flavors	$	90,337		$	84,015
Fragrances	87,596			79,924
Global expenses	(12,232		)	(8,629		)
Restructuring and other charges, net	(182		)	358
Acquisition and related costs	(213		)	(6,566		)
Operational improvement initiative costs	(831		)	(281		)
Operating profit	$	164,475		$	148,821
Profit margin:
Flavors	23.8		%	22.6		%
Fragrances	21.2		%	20.2		%
Consolidated	20.7		%	19.4		%

Flavors Segment Profit

Flavors segment profit increased to $90.3 million in the second quarter of 2016, or 23.8% as a percentage of sales, with $84.0 million, or 22.6% as a percentage of sales, in the comparable 2015 period, principally reflecting productivity initiatives which were partially offset by incremental costs related to new sites.

Fragrances Segment Profit

Fragrances segment profit increased approximately 9.6% to $87.6 million in the second quarter of 2016, or 21.2% as a percentage of sales, compared to $79.9 million, or 20.2% as a percentage of sales, in the comparable 2015 period. The increase in segment profit and profit margin was primarily due to volume growth, productivity initiatives and the impact of Lucas Meyer, which were partially offset by the net impact of price versus input costs and increased incentive compensation.

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Global Expenses

Global expenses represent corporate and headquarters-related expenses which include legal, finance, human resources and R&D and other administrative expenses that are not allocated to an individual business unit. In the second quarter of 2016, Global expenses were $12.2 million compared to $8.6 million during the second quarter of 2015. The increase was principally driven by higher compensation costs and lower favorable impact from our cash flow hedging program.

Interest Expense

Interest expense increased $3.7 million to $15.1 million in the second quarter of 2016 compared to $11.4 million in the 2015 period reflecting the impact of borrowings under the Euro Senior Notes - 2016. Average cost of debt was 4.0% for the 2016 period compared to 4.7% for the 2015 period.

Other (Income) Expense, Net

Other (income) expense, net increased by approximately $3.0 million to $2.6 million of income in the second quarter of 2016 versus $0.4 million of expense in the comparable 2015 period. The year-over-year increase is primarily driven by higher foreign exchange gains in 2016.

Income Taxes

The effective tax rate for the three months ended June 30, 2016 was 23.2% compared with 23.1% for the three months ended June 30, 2015. The quarter-over-quarter increase is largely due to higher loss provisions in 2016 partially offset by lower cost of repatriation in the second quarter of 2016. Excluding the $0.2 million tax benefit associated with the pretax restructuring and operational improvement initiatives and the $0.1 million tax charge associated with acquisition costs included in the current quarter, the second quarter 2016 adjusted effective tax rate was 23.1%, or 50 bps higher than the second quarter 2015 adjusted effective tax rate of 22.6%. The 2015 adjusted effective tax rate excluded $0.9 million of tax benefit associated with the pretax acquisition and operational improvement initiative costs and $0.1 million tax charge associated with pretax restructuring costs.

FIRST SIX MONTHS OF 2016 IN COMPARISON TO FIRST SIX MONTHS 2015

Sales

Sales for the first six months of 2016 totaled $1.6 billion, an increase of 2% from the prior year period. On a currency neutral basis sales increased 5%, as a result of new win performance in both Flavors and Fragrance Compounds, in addition to strong growth in Fragrance Ingredients, driven by the impact of acquisitions and lower volume erosion on existing business in Fragrance Compounds. On both a reported and currency neutral basis, the effect of acquisitions was approximately 3% to net sales amounts. Overall currency neutral growth included 6% growth from developed markets and 4% growth from emerging markets.

Flavors Business Unit

Flavors reported sales remained flat against the prior year period while currency neutral sales increased 4% during the first six months of 2016 compared to the 2015 period, which was partially driven by the inclusion of acquisitions in both reported and currency neutral basis amounts. In addition, the overall performance reflects new win performance. The currency neutral increase was due to low to mid single-digit growth in all four end-use categories. The Flavors business delivered currency neutral growth all four regions, led by NOAM. Sales in NOAM were led by high single-digit gains in Beverage and Sweet. Sales in GA were driven by high single-digit gains in Sweet. LA sales were driven by double-digit gains in Savory. EAME sales were driven by high single-digit gains in Dairy.

Fragrances Business Unit

The Fragrances business experienced an increase of 4% in reported sales and an 6% increase in currency neutral sales for the first six months of 2016 compared to the 2015 period. Acquisitions accounted for primarily all of the growth on a reported basis and accounted for approximately half of the growth on a currency neutral basis. The overall currency neutral increase was primarily driven by double-digit growth in Fragrance Ingredients, which is driven entirely by the inclusion of acquisitions, and Personal Wash as well as mid single-digit growth in Fabric Care, Fine Fragrance and Home Care. Excluding the effects of acquisitions, Fragrance Ingredients sales declined mid single-digits on a currency neutral basis.

Sales Performance by Region and Category

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		% Change in Sales - First Six Months 2016 vs. First Six Months 2015
		Fine Fragrances		Consumer Fragrances		Ingredients		Total Frag.		Flavors		Total
NOAM	Reported	5	%	7	%	23	%	10	%	6	%	8	%
EAME	Reported	-2	%	-1	%	13	%	2	%	-3	%	0	%
	Currency Neutral (1)	0	%	1	%	15	%	4	%	1	%	3	%
LA	Reported	-1	%	0	%	-10	%	-1	%	-6	%	-2	%
	Currency Neutral (1)	9	%	3	%	-9	%	3	%	1	%	2	%
GA	Reported	-3	%	6	%	12	%	7	%	1	%	3	%
	Currency Neutral (1)	-1	%	8	%	12	%	8	%	4	%	6	%
Total	Reported	0	%	3	%	13	%	4	%	0	%	2	%
	Currency Neutral (1)	3	%	5	%	15	%	6	%	4	%	5	%

(1) Currency neutral sales growth is calculated by translating prior year sales at the exchange rates for the corresponding 2016 period.

• NOAM Flavors sales increased 6%, which included the impact of acquisitions contributing to high single-digit growth in Beverage and Sweet which more than offset high single-digit declines in Dairy. NOAM Fragrance sales increased 10% in the second quarter of 2016, principally due to double-digit gains Fragrance Ingredients, which included the impact of acquisitions, Fabric Care and Home Care as well as mid single-digit gains in Fine Fragrance.

• EAME Flavors currency neutral sales increased 1% primarily due to high single-digit growth in Dairy and low single-digit growth in Beverage and Sweet. EAME Fragrance currency neutral sales increased 4% overall, driven mainly by double-digit growth in Fragrance Ingredients, which included the impact of acquisitions, and Hair Care as well as low single-digit growth in Fabric Care and Fine Fragrance.

• LA Flavors currency neutral sales were up 1% driven by double-digit gains in the Savory and Dairy. LA Fragrances currency neutral sales increased 3% overall, principally led by double-digit gains in Personal Wash, Fine Fragrance and Hair Care, which more than offset high single-digit declines in Fragrance Ingredients and mid single-digit declines in Fabric Care.

• GA Flavors currency neutral sales increased 4% from the prior year period driven by high single-digit gains in Sweet and low to mid single-digit gains in Savory, Beverage and Dairy. GA Fragrances currency neutral sales growth of 8% was principally driven by double-digit gains in Fragrance Ingredients, which included the impact of acquisitions, Fabric Care and Personal Wash which more than offset mid single-digit declines in Hair Care.

Cost of Goods Sold

Cost of goods sold, as a percentage of sales, decreased 120 bps to 54.0% in the first six months of 2016 compared to 55.2% in the first six months of 2015, principally driven by cost savings and productivity initiatives. Included in cost of goods sold was $2.3 million of acquisition-related, restructuring and operational improvement costs in 2016 compared to $1.4 million of acquisition-related and operational improvement initiative costs in 2015.

Research and Development (R&D) Expenses

Overall R&D expenses, as a percentage of sales, decreased slightly compared to the prior year period at 8.0% in the first six months of 2016 versus 8.2% for the first six months of 2015.

Selling and Administrative (S&A) Expenses

S&A expenses increased $6.3 million to $256.3 million or 16.3%, as a percentage of sales, in the first six months of 2016 compared to 16.2% in the first six months of 2015. The $6.3 million increase was principally due to costs associated with expenses of acquired entities which were partially offset by the impact of currency and a $1.5 million benefit related to the Spanish capital tax settlement. Excluding the benefit of $1.5 million, adjusted S&A expenses increased by $4.8 million and was 16.2% of sales.

Amortization of Acquisition-Related Intangibles

Amortization expenses increased $6.3 million to $11.2 million in the first six months of 2016 compared to $4.9 million in the first six months of 2015. The $6.3 million increase was driven by the acquisitions of Ottens Flavors and Lucas Meyer in the second and third quarters of 2015, respectively.

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Operating Results by Business Unit

We evaluate the performance of business units based on segment profit which is defined as operating profit before Restructuring and other charges, net, Global expenses (as discussed in Note 9 to the Consolidated Financial Statements) and certain non-recurring items, net, Interest expense, Other (expense) income, net and Taxes on income. See Note 9 to the Consolidated Financial Statements for the reconciliation to Income before taxes.

	Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015
Segment profit:
Flavors	$	182,151		$	176,743
Fragrances	176,833			161,522
Global expenses	(26,141		)	(20,194		)
Restructuring and other charges, net	(283		)	170
Acquisition and related costs	(1,249		)	(7,066		)
Operational improvement initiative costs	(1,099		)	(562		)
Spanish capital tax settlement	1,482			—
Operating profit	$	331,694		$	310,613
Profit margin:
Flavors	24.2		%	23.6		%
Fragrances	21.4		%	20.4		%
Consolidated	21.0		%	20.1		%

Flavors Segment Profit

Flavors segment profit increased to $182.2 million in the first six months of 2016, or 24.2% as a percentage of sales, with $176.7 million, or 23.6% as a percentage of sales in the comparable 2015 period, principally reflecting productivity initiatives, growth from Ottens Flavors and lower compensation costs, partially offset by higher S&A costs, unfavorable input costs and incremental costs related to new sites.

Fragrances Segment Profit

Fragrances segment profit increased approximately 9% to $176.8 million in the first six months of 2016, or 21.4% as a percentage of sales, compared to $161.5 million, or 20.4% as a percentage of sales, in the comparable 2015 period. The increase in segment profit and profit margin was primarily due to volume growth, productivity initiatives and the impact of Lucas Meyer, which was partially offset by higher S&A costs.

Global Expenses

Global expenses represent corporate and headquarters-related expenses which include legal, finance, human resources and R&D and other administrative expenses that are not allocated to an individual business unit. In the first six months of 2016, Global expenses were $26.1 million compared to $20.2 million during the 2015 period. The increase was principally driven by higher compensation costs which were partially offset by higher favorable impact from our cash flow hedging program.

Interest Expense

Interest expense increased $5.0 million to $27.5 million in the first six months of 2016 compared to $22.5 million in the 2015 period reflecting the impact of borrowings under the Euro Senior Notes - 2016. Average cost of debt was 3.9% for the 2016 period compared to 4.7% for the 2015 period.

Other (Income) Expense, net

Other (income) expense, net increased by approximately $2.5 million to $2.8 million of income in the first six months of 2016 versus $5.3 million of income in the comparable 2015 period. The year-over-year increase is primarily driven by a gain on the sale of land and higher foreign exchange gains in 2016.

Income Taxes

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The effective tax rate for the six months ended June 30, 2016 was 23.3% compared with 20.4% for the six months ended June 30, 2015. The increase was largely due to a benefit of $10.5 million recorded in the first six months of 2015, as a result of favorable tax rulings in Spain and another jurisdiction for which reserves were previously recorded as well as higher loss provisions, which were partially offset by lower cost of repatriation in 2016. Excluding the $0.6 million tax benefit associated with pretax restructuring, operational improvement initiatives and acquisition related costs and the $0.4 million charge related to the Spanish capital tax settlement in the current period, the 2016 period adjusted effective tax rate was 23.3%, or 40 bps lower than the 2015 period adjusted effective tax rate of 23.7%. The 2015 adjusted effective tax rate excluded $1.1 million of tax benefit associated with pretax restructuring, operational improvement initiative and acquisition related costs and the $10.5 million settlement related to the favorable tax ruling discussed above.

Liquidity and Capital Resources

CASH AND CASH EQUIVALENTS

We had cash and cash equivalents of $540.0 million at June 30, 2016 compared to $182.0 million at December 31, 2015, of which $357.8 million of the balance at June 30, 2016 was held outside the United States. Cash balances held in foreign jurisdictions are, in most circumstances, available to be repatriated to the United States; however, they would be subject to United States federal income taxes, less applicable foreign tax credits. We have not provided U.S. income tax expense on substantially all of the accumulated undistributed earnings of our foreign subsidiaries because we have the ability and plan to reinvest these indefinitely.

Effective utilization of the cash generated by our international operations is a critical component of our tax strategy. Strategic dividend repatriation from foreign subsidiaries creates U.S. taxable income, which enables us to realize deferred tax assets. The Company regularly repatriates, in the form of dividends from its non-U.S. subsidiaries, a portion of its current year earnings to fund financial obligations in the U.S.

CASH FLOWS FROM OPERATING ACTIVITIES

Net cash provided by operating activities in the first six months of 2016 was $154.6 million compared to $166.3 million in the first six months of 2015. The decrease in operating cash flows for the first six months of 2016 compared to 2015 was principally driven by increased core working capital requirements partially offset by lower pension contributions for the 2016 period as compared to 2015 period.

Working capital (current assets less current liabilities) totaled $1,241.2 million at June 30, 2016, compared to $712.0 million at December 31, 2015. The Company sold certain accounts receivable on a non-recourse basis to unrelated financial institutions under “factoring” agreements that are sponsored, solely and individually, by certain customers. We believe that participating in the factoring programs strengthens our relationships with these customers and provides operational efficiencies. The beneficial impact on cash from operations from participating in these programs increased approximately $17.7 million for the six months ended June 30, 2016 compared to an increase of approximately $1.3 million for the six months ended June 30, 2015. The cost of participating in these programs was immaterial to our results in all periods.

CASH FLOWS USED IN INVESTING ACTIVITIES

Net investing activities during the first six months of 2016 used $40.2 million compared to $215.0 million in the prior year period. The decrease in cash used in investing activities principally reflects the acquisition of Ottens Flavors during the 2015 period. Additions to property, plant and equipment were $43.2 million during the first six months of 2016 compared to $37.9 million in the first six months of 2015. We expect additions to property, plant and equipment will be approximately 5% of our sales (net of potential grants and other reimbursements from government authorities) in 2016.

CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES

Net financing activities in the first six months of 2016 provided $253.1 million of cash inflows compared to a use of $47.0 million in the first six months of 2015. The increase in cash provided by financing activities principally reflects the issuance of our Euro Senior Notes - 2016 (as discussed in Note 6 to the Consolidated Financial Statements), which was only partially offset by the repayment of our credit facility, higher treasury stock purchases and higher dividend payments during 2016 as compared to 2015.

At June 30, 2016, we had $1,491.2 million of debt outstanding compared to $1,067.7 million outstanding at December 31, 2015.

We paid dividends totaling $89.5 million in the 2016 period. We declared a cash dividend per share of $0.56 in the second quarter of 2016 that was paid on July 7, 2016 to all shareholders of record as of June 27, 2016.

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In December 2012, the Board of Directors authorized a $250 million share repurchase program, which commenced in the first quarter of 2013. In August 2015, the Board of Directors approved an additional $250 million share repurchase authorization and extension through December 31, 2017. Based on the total remaining amount of $165.0 million available under the amended repurchase program, approximately 1.3 million shares, or 1.6% of shares outstanding (based on the market price and shares outstanding as of June 30, 2016) could be repurchased under the program as of June 30, 2016. The purchases will be made from time to time on the open market or through private transactions as market and business conditions warrant. Repurchased shares will be placed into treasury stock. During the three months ended June 30, 2016, we repurchased 258,890 shares on the open market at an aggregate cost of $31.7 million or an average of $122.47 per share. During the six months ended June 30, 2016, we repurchased 622,224 shares on the open market at an aggregate cost of $71.7 million or an average of $115.25 per share. The ultimate level of purchases will be a function of the daily purchase limits established in the pre-approved program according to the share price at that time.

CAPITAL RESOURCES

Operating cash flow provides the primary source of funds for capital investment needs, dividends paid to shareholders and debt repayments. We anticipate that cash flows from operations and availability under our existing credit facilities are sufficient to meet our investing and financing needs for at least the next eighteen months. We regularly assess our capital structure, including both current and long-term debt instruments, as compared to our cash generation and investment needs in order to provide ample flexibility and to optimize our leverage ratios. We believe our existing cash balances are sufficient to meet our debt service requirements.

We supplement short-term liquidity with access to capital markets, mainly through bank credit facilities and issuance of commercial paper. We did not issue commercial paper during the first six months of 2016 or 2015.

We expect to contribute a total of approximately $30 million to our non-U.S. pension plans and $20 million to our U.S. pension plans during 2016. During the six months ended June 30, 2016, $20.0 million contributions were made to our qualified U.S. pension plans and $17.3 million contributions were made to our non-U.S. pension plans.

On March 14, 2016, we issued Euro 500.0 million face amount of 1.75% Senior Notes ("Euro Senior Notes - 2016") due 2024 at a discount of Euro 0.9 million. The Company received proceeds related to the issuance of these Euro Senior Notes - 2016 of Euro 496.0 million which was net of the Euro 0.9 million discount and Euro 3.1 million underwriting discount (recorded as deferred financing costs). In addition, the Company incurred $1.3 million of other deferred financing costs in connection with the debt issuance. The discount and deferred financing costs are being amortized as interest expense over the term of the Euro Senior Notes - 2016. The Euro Senior Notes - 2016 bear interest at a rate of 1.75% per annum, with interest payable on March 14 of each year, commencing on March 14, 2017. The Euro Senior Notes - 2016 will mature on March 14, 2024. See Note 6 to the Consolidated Financial Statements for further information.

On July 12, 2016, the Company made a payment of $125.0 million related to our Senior Notes - 2006.

As of June 30, 2016, we had no borrowings under our revolving credit facility. The amount which we are able to draw down on under the facility is limited by financial covenants as described in more detail below. Our draw down capacity on the facility was $950.0 million at June 30, 2016.

Under our revolving credit facility, we are required to maintain, at the end of each fiscal quarter, a ratio of net debt for borrowed money to adjusted EBITDA in respect of the previous 12-month period of not more than 3.25 to 1. Based on this ratio, at June 30, 2016 our covenant compliance provided overall borrowing capacity of $1,448 million.

At June 30, 2016, we were in compliance with all financial and other covenants, including the net debt to adjusted EBITDA ratio. At June 30, 2016 our Net Debt/adjusted EBITDA ⁽¹⁾ ratio, as defined by the debt agreements, was 1.29 to 1, well below the financial covenants of existing outstanding debt. Failure to comply with the financial and other covenants under our debt agreements would constitute default and would allow the lenders to accelerate the maturity of all indebtedness under the related agreement. If such acceleration were to occur, we would not have sufficient liquidity available to repay the indebtedness. We would likely have to seek amendments under the agreements for relief from the financial covenants or repay the debt with proceeds from the issuance of new debt or equity, and/or asset sales, if necessary. We may be unable to amend the agreements or raise sufficient capital to repay such obligations in the event the maturities are accelerated.

(1) Adjusted EBITDA and Net Debt, which are non-GAAP measures used for these covenants, are calculated in accordance with the definition in the debt agreements. In this context, these measures are used solely to provide information on the extent to which we are in compliance with debt covenants and may not be comparable to adjusted EBITDA and Net Debt used by other companies. Reconciliations of adjusted EBITDA to net income and net debt to total debt are as follows:

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	Twelve Months Ended June 30,
(DOLLARS IN MILLIONS)	2016		2015
Net income	$	420.8	$	431.2
Interest expense	51.2		45.5
Income taxes	131.8		121.9
Depreciation and amortization	98.2		81.4
Specified items (1)	15.0		0.8
Non-cash items (2)	20.4		19.3
Adjusted EBITDA	$	737.4	$	700.1

(1) Specified items for the 12 months ended June 30, 2016 of $15.0 million consist of costs associated with restructuring and the acceleration of the contingent consideration related to the Aromor acquisition as discussed in our 2015 Form 10-K.

(2) Non-cash items represent all other adjustments to reconcile net income to net cash provided by operations as presented on the Statement of Cash Flows, including gain on disposal of assets, stock-based compensation and pension settlement/curtailment.

	June 30,
(DOLLARS IN MILLIONS)	2016			2015
Total debt	$	1,491.2		$	998.0
Adjustments:
Deferred gain on interest rate swaps	(2.3		)	(4.2		)
Cash and cash equivalents	(540.0		)	(377.3		)
Net debt	$	948.9		$	616.5

As discussed in Note 13 to the Consolidated Financial Statements, at June 30, 2016, we had entered into various guarantees and had undrawn outstanding letters of credit from financial institutions. These arrangements reflect ongoing business operations, including commercial commitments, and governmental requirements associated with audits or litigation that are in process with various jurisdictions. Based on the current facts and circumstances they are not reasonably likely to have a material impact on our consolidated financial condition, results of operations, or cash flows.

Cautionary Statement Under the Private Securities Litigation Reform Act of 1995

This Quarterly Report includes “forward-looking statements” under the Federal Private Securities Litigation Reform Act of 1995, including statements regarding our expectations concerning (i) expected cost pressures in 2016, (ii) capital spending in 2016, (iii) cash flows to fund future operations and to meet debt service requirements, and (iv) our plans and intentions to indefinitely reinvest undistributed foreign earnings in our foreign subsidiaries to fund local operations and/or capital projects. These forward-looking statements should be evaluated with consideration given to the many risks and uncertainties inherent in our business that could cause actual results and events to differ materially from those in the forward-looking statements. Certain of such forward-looking information may be identified by such terms as “will,” “expect,” “anticipate,” “believe,” “outlook,” “may,” “estimate,” “should,” “intend,” “plan” and “predict” similar terms or variations thereof. Such forward-looking statements are based on a series of expectations, assumptions, estimates and projections about the Company, are not guarantees of future results or performance, and involve significant risks, uncertainties and other factors, including assumptions and projections, for all forward periods. Our actual results may differ materially from any future results expressed or implied by such forward-looking statements. Such factors include, among others, the following:

• our ability to implement our Vision 2020 strategy;

• our ability to successfully identify and complete acquisitions in line with our Vision 2020 strategy, and to realize the anticipated benefits of those acquisitions;

• our ability to effectively compete in our market, and to successfully develop new and competitive products that appeal to our customers and consumers;

• changes in consumer preferences and demand for our products or a decline in consumer confidence and spending;

• our ability to benefit from our investments and expansion in emerging markets;

• the impact of currency fluctuations or devaluations in the principal foreign markets in which we operate, including the devaluation of the Euro;

• the economic and political risks associated with our international operations, including challenging economic conditions in China and Latin America;

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• the effect of legal and regulatory developments, as well as restrictions or costs that may be imposed on us or our operations by U.S. and foreign governments;

• the impact of any failure of our key information technology systems or a breach of information security;

• our ability to attract and retain talented employees;

• our ability to comply with, and the costs associated with compliance, with U.S. and foreign environmental protection laws;

• our ability to realize expected cost savings and efficiencies from our profitability improvement initiatives and other optimization activities;

• volatility and increases in the price of raw materials, energy and transportation;

• fluctuations in the quality and availability of raw materials;

• the impact of a disruption in our supply chain or our relationship with our suppliers;

• any adverse impact on the availability, effectiveness and cost of our hedging and risk management strategies;

• our ability to successfully manage our working capital and inventory balances;

• uncertainties regarding the outcome of, or funding requirements, related to litigation or settlement of pending litigation, uncertain tax positions or other contingencies;

• adverse changes in federal, state, local and international tax legislation or policies, including with respect to transfer pricing and state aid, and adverse results of tax audits, assessments, or disputes; and

• changes in market conditions or governmental regulations relating to our pension and postretirement obligations.

New risks emerge from time to time and it is not possible for management to predict all such risk factors or to assess the impact of such risks on our business. Accordingly, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

Any public statements or disclosures by the Company following this report that modify or impact any of the forward-looking statements contained in or accompanying this report will be deemed to modify or supersede such outlook or other forward-looking statements in or accompanying this report.

The foregoing list of important factors does not include all such factors, nor necessarily present them in order of importance. In addition, you should consult other disclosures made by the Company (such as in our other filings with the SEC or in company press releases) for other factors that may cause actual results to differ materially from those projected by the Company. Please refer to Part I. Item 1A., Risk Factors, of the 2015 Form 10-K for additional information regarding factors that could affect our results of operations, financial condition and cash flow.

Non-GAAP Financial Measures

The Company uses non-GAAP financial operating measures in this Quarterly Report, including: (i) currency neutral sales (which eliminates the effects that result from translating its international sales in U.S. dollars), (ii) adjusted operating profit and adjusted operating margin (which excludes the acquisition related costs, operational improvement initiative costs, restructuring charges and tax settlements), (iii) adjusted selling and administrative expenses (which excludes the benefit related to the Spanish capital tax settlement and (iv) adjusted effective tax rate (which excludes acquisition related costs, operational improvement initiative costs, restructuring charges and tax settlements). The Company also provides the non-GAAP measures adjusted EBITDA (which excludes certain specified items and non-cash items as set forth in the Company’s debt agreements) and net debt (which is adjusted for deferred gain on interest rate swaps and cash and cash equivalents) solely for the purpose of providing information on the extent to which the Company is in compliance with debt covenants contained in its debt agreements.

We have included each of these non-GAAP measures in order to provide additional information regarding our underlying operating results and comparable year-over-year performance. Such information is supplemental to information presented in accordance with GAAP and is not intended to represent a presentation in accordance with GAAP. In discussing our historical and expected future results and financial condition, we believe it is meaningful for investors to be made aware of and to be assisted in a better understanding of, on a period-to-period comparable basis, financial amounts both including and excluding these identified items, as well as the impact of exchange rate fluctuations. We believe such additional non-GAAP information provides investors with an overall perspective of the period-to-period performance of our business. In addition, management internally reviews each of these non-GAAP measures to evaluate performance on a comparative period-to-period basis in terms of absolute performance, trends and expected future performance with respect to our business. A material limitation of these non-GAAP measures is that such measures do not reflect actual GAAP amounts. We compensate for such limitations by using these measures as one of several metrics, including GAAP measures. These non-GAAP measures may not be comparable to similarly titled measures used by other companies.

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A. 2016 Quarter-to-Date Reconciliations

	Second Quarter 2016
	Items Impacting Comparability
	Adjusted Gross Profit
	Reported (GAAP)	Restructuring and Other Charges (a)	Operational Improvement Initiative Costs (b)	Adjusted (Non-GAAP)
Gross profit	365,641	182	831	366,654

	Second Quarter 2016
	Items Impacting Comparability
	Adjusted Selling and administrative expenses
	Reported (GAAP)	Acquisition and Related Costs (c)		Adjusted (Non-GAAP)
Selling and administrative expenses	132,784	(213	)	132,571

	Second Quarter 2016
	Items Impacting Comparability
	Adjusted Operating Profit
	Reported (GAAP)	Restructuring and Other Charges (a)	Operational Improvement Initiative Costs (b)	Acquisition Related Costs (c)	Adjusted (Non-GAAP)
Operating profit	164,475	182	831	213	165,701

	Second Quarter 2016
	Items Impacting Comparability
	Adjusted Net Income
	Reported (GAAP)	Restructuring and Other Charges (a)	Operational Improvement Initiative Costs (b)	Acquisition Related Costs (c)		Adjusted (Non-GAAP)
Income before taxes	152,050	182	831	213		153,276
Taxes on income (d)	35,317	35	208	(102	)	35,458
Net income	116,733	147	623	315		117,818

2016 Quarter-to-Date Footnote Explanations:

(a) Accelerated depreciation costs related to restructuring initiatives.

(b) Accelerated depreciation and severance costs in Asia.

(c) Additional transaction costs related to acquisition of Lucas Meyer.

(d) The tax effects are calculated based upon the specific rate of the applicable jurisdiction of the items.

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B. 2015 Quarter-to-Date Reconciliations

	Second Quarter 2015
	Items Impacting Comparability
	Adjusted Gross Profit
	Reported (GAAP)	Operational Improvement Initiative Costs (b)	Acquisition and Related Costs (c)	Adjusted (Non-GAAP)
Gross profit	345,040	281	844	346,165

	Second Quarter 2015
	Items Impacting Comparability
	Adjusted Selling and Administrative Expenses
	Reported (GAAP)	Acquisition and Related Costs (c)		Adjusted (Non-GAAP)
Selling and administrative expenses	131,023	(5,722	)	125,301

	Second Quarter 2015
	Items Impacting Comparability
	Adjusted Operating Profit
	Reported (GAAP)	Restructuring and Other Charges (a)		Operational Improvement Initiative Costs (b)	Acquisition related costs (c)	Adjusted (Non-GAAP)
Operating profit	148,821	(358	)	281	6,566	155,310

	Second Quarter 2015
	Items Impacting Comparability
	Adjusted Net Income
	Reported (GAAP)	Restructuring and Other Charges (a)		Operational Improvement Initiative Costs (b)	Acquisition Related Costs (c)	Adjusted (Non-GAAP)
Income before taxes	136,978	(358	)	281	6,566	143,467
Taxes on income (d)	31,604	(125	)	70	875	32,424
Net income	105,374	(233	)	211	5,691	111,043

2015 Quarter-to-Date Footnote Explanations:

(a) Costs related to the Fragrance Ingredients Rationalization.

(b) Accelerated depreciation related to a partial plant closing in Asia.

(c) Transaction costs related to acquisitions (Ottens Flavors and Lucas Meyer Cosmetics) as well as expense related to the fair value step up of inventory on the Ottens Flavors acquisition.

(d) The tax effects are calculated based upon the specific rate of the applicable jurisdiction of the items.

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C. 2016 Year-to-Date Reconciliations

	Second Quarter Year-to-Date 2016
	Items Impacting Comparability
	Adjusted Gross Profit
	Reported (GAAP)	Restructuring and Other Charges (a)	Operational Improvement Initiative Costs (b)	Acquisition Related Costs (c)	Adjusted (Non-GAAP)
Gross profit	725,849	283	1,099	889	728,120

	Second Quarter Year-to-Date 2016
	Items Impacting Comparability
	Adjusted Selling and Administrative Expense
	Reported (GAAP)	Acquisition Related Costs (c)		Tax Settlements (d)	Adjusted (Non-GAAP)
Selling and administrative expense	256,327	(360	)	1,482	257,449

	Second Quarter Year-to-Date 2016
	Items Impacting Comparability
	Adjusted Operating Income
	Reported (GAAP)	Restructuring and Other Charges (a)	Operational Improvement Initiative Costs (b)	Acquisition Related Costs (c)	Tax Settlements (d)		Adjusted (Non-GAAP)
Operating profit	331,694	283	1,099	1,249	(1,482	)	332,843

	Second Quarter Year-to-Date 2016
	Items Impacting Comparability
	Adjusted Net Income
	Reported (GAAP)	Restructuring and Other Charges (a)	Operational Improvement Initiative Costs (b)	Acquisition Related Costs (c)	Tax Settlements (d)		Adjusted (Non-GAAP)
Income before taxes	306,947	283	1,099	1,249	(1,482	)	308,096
Taxes on income (e)	71,610	54	275	266	(411	)	71,794
Net income	235,337	229	824	983	(1,071	)	236,302

2016 Year-to-Date Footnote Explanations:

(a) Accelerated depreciation costs related to restructuring initiatives.

(b) Accelerated depreciation and severance costs in Asia.

(c) Expense related to the fair value step up of inventory and additional transaction costs related to acquisition of Lucas Meyer.

(d) Settlements due to favorable tax rulings in jurisdictions for which reserves were previously recorded for ongoing tax disputes.

(e) The tax effects are calculated based upon the specific rate of the applicable jurisdiction of the items.

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D. 2015 Year-to-Date Reconciliations

	Second Quarter Year-to-Date 2015
	Items Impacting Comparability
	Adjusted Gross Profit
	Reported (GAAP)	Operational Improvement Initiative Costs (b)	Acquisition Related Costs (c)	Adjusted (Non-GAAP)
Gross profit	691,317	562	843	692,722

	Second Quarter Year-to-Date 2015
	Items Impacting Comparability
	Adjusted Selling and Administrative Expense
	Reported (GAAP)	Acquisition Related Costs (c)		Adjusted (Non-GAAP)
Selling and administrative expense	250,018	(6,222	)	243,796

	Second Quarter Year-to-Date 2015
	Items Impacting Comparability
	Adjusted Operating Income
	Reported (GAAP)	Restructuring and Other Charges (a)		Operational Improvement Initiative Costs (b)	Acquisition Related Costs (c)	Adjusted (Non-GAAP)
Operating profit	310,613	(170	)	562	7,065	318,070

	Second Quarter Year-to-Date 2015
	Items Impacting Comparability
	Adjusted Net Income
	Reported (GAAP)	Restructuring and Other Charges (a)		Operational Improvement Initiative Costs (b)	Acquisition Related Costs (c)	Tax Settlements (d)		Adjusted (Non-GAAP)
Income before taxes	293,386	(170	)	562	7,065	—		300,843
Taxes on income (e)	59,754	(60	)	140	1,050	10,478		71,362
Net income	233,632	(110	)	422	6,015	(10,478	)	229,481

2015 Year-to-Date Footnote Explanations:

(a) Costs related to the Fragrance Ingredients Rationalization.

(b) Accelerated depreciation related to plant closings in Europe and partial closing in Asia.

(c) Transaction costs related to acquisitions (Ottens Flavors and Lucas Meyer Cosmetics) as well as expense related to the fair value step up of inventory on the Ottens Flavors acquisitions.

(d) Settlements due to favorable tax rulings in jurisdictions for which reserves were previously recorded for ongoing tax disputes.

(e) The tax effects are calculated based upon the specific rate of the applicable jurisdiction of the items.

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E. Foreign Currency Reconciliation

	Three Months Ended June 30,		Six Months Ended June 30,
	2016	2015	2016	2015
Operating Profit:
% Change - Reported (GAAP)	11%	(3)%	7%	—%
Items impacting comparability (1)	(4)%	2%	(2)%	1%
% Change - Adjusted (Non-GAAP)	7%	(1)%	5%	1%
Currency Impact	—%	8%	2%	8%
% Change Year-over-Year - Currency Neutral Adjusted (Non-GAAP)**	7%	7%	7%	9%

_______________________ 

(1) Includes $1.2 million and $6.5 million of restructuring, operational improvement initiatives and acquisition related costs for the three months ended June 30, 2016 and June 30, 2015, respectively. Includes $1.1 million of restructuring, operational improvement initiatives and acquisition related costs as well as the benefit of the Spanish capital tax settlement and $7.5 million of restructuring, operational improvement initiatives and acquisition related costs for the six months ended June 30, 2016 and June 30, 2015, respectively.

** Currency neutral amount is calculated by translating prior year amounts at the exchange rates used for the corresponding 2016 period. Currency neutral operating profit also eliminates the year-over-year impact of cash flow hedging.

F. Acquisition Related Intangible Asset Amortization

The Company tracks the amount of amortization recorded on recent acquisitions in order to monitor its progress with respect to its Vision 2020 goals. The following amounts were recorded with respect to recent acquisitions:                

	Three Months Ended June 30,		Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016	2015	2016	2015
Amortization Expense:
Ottens Flavors	$1,586	$1,200	$3,202	$1,200
Lucas Meyer	1,686	—	4,272	—

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

There are no material changes in market risk from the information provided in our 2015 Form 10-K.

Item 4. Controls and Procedures

The Chief Executive Officer and Chief Financial Officer with the assistance of other members of our management, have evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures are effective as of the end of the period covered by this Quarterly Report on Form 10-Q.

We have established controls and procedures designed to ensure that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and is accumulated and communicated to management, including the principal executive officer and the principal financial officer, to allow timely decisions regarding required disclosure.

The Chief Executive Officer and Chief Financial Officer have also concluded that there have not been any changes in our internal control over financial reporting during the quarter ended June 30, 2016 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

We are subject to various claims and legal actions in the ordinary course of our business.

Tax Claims

The Spanish tax authorities alleged claims for a capital tax, the Appellate Court rejected one of the two bases upon which we based our capital tax position. On January 22, 2014, we filed an appeal and in order to avoid future interest costs in the event our appeal was unsuccessful, we paid Euro 9.8 million ($11.2 million, representing the principal amount) during the first quarter of 2014. On February 24, 2016, we received a favorable ruling on our appeal from the Spanish Supreme Court which overruled a lower court ruling. As a result of this decision, we have reversed the previously recorded provision of Euro 9.8 million ($10.5 million) for the year ended December 31, 2015. During the second quarter of 2016, we recorded additional income of $1.4 million related to the finalization of amounts expected to be received from the authorities. This amount has been reflected as a reduction of administrative expense.

Environmental

Over the past 20 years, various federal and state authorities and private parties have claimed that we are a Potentially Responsible Party (“PRP”) as a generator of waste materials for alleged pollution at a number of waste sites operated by third parties located principally in New Jersey and have sought to recover costs incurred and to be incurred to clean up the sites.

We have been identified as a PRP at eight facilities operated by third parties at which investigation and/or remediation activities may be ongoing. We analyze our potential liability on at least a quarterly basis. We accrue for environmental liabilities when they are probable and estimable. We estimate our share of the total future cost for these sites to be less than $5 million.

While joint and several liability is authorized under federal and state environmental laws, we believe the amounts we have paid and anticipate paying in the future for clean-up costs and damages at all sites are not material and will not have a material adverse effect on our financial condition, results of operations or liquidity. This assessment is based upon, among other things, the involvement of other PRPs at most of the sites, the status of the proceedings, including various settlement agreements and consent decrees, and the extended time period over which payments will likely be made. There can be no assurance, however, that future events will not require us to materially increase the amounts we anticipate paying for clean-up costs and damages at these sites, and that such increased amounts will not have a material adverse effect on our financial condition, results of operations or cash flows.

Other

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In March 2012, ZoomEssence, Inc. filed a complaint against the Company in the U.S. District Court of New Jersey alleging trade secret misappropriation, breach of contract and unjust enrichment in connection with certain spray dry technology disclosed to the Company. In connection with the claims, ZoomEssence is seeking an injunction and monetary damages. ZoomEssence initially sought a temporary restraining order and preliminary injunction, but the Court denied these applications in an order entered on September 27, 2013, finding that ZoomEssence had not demonstrated a likelihood of success on the merits of its claims. The Court subsequently referred the matter to mediation, however the private mediation session did not result in a resolution of the dispute. On November 3, 2014, ZoomEssence amended its complaint against the Company to include allegations of breach of the duty of good faith and fair dealing, fraud in the inducement, and misappropriation of confidential and proprietary information. On November 13, 2014, the Company filed a counterclaim against ZoomEssence alleging trade secret misappropriation, breach of contract, breach of the implied covenant of good faith and fair dealing, unjust enrichment, misappropriation of confidential and proprietary information,  common law unfair competition, tortious interference with contractual relations, and conversion. The case is currently proceeding through discovery with a trial on the merits anticipated in late 2016/early 2017. The Company denies the allegations and will vigorously defend and pursue its position in Court. At this stage of the litigation, based on the information currently available to the Company, management does not believe that this matter represents a material loss contingency.

We are also a party to other litigations arising in the ordinary course of our business. We do not expect the outcome of these cases, singly or in the aggregate, to have a material effect on our consolidated financial condition.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(c) Issuer Purchases of Equity Securities

The table below reflects shares of common stock we repurchased during the second quarter of 2016.

Period	Total Number of Shares Repurchased (1)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Program	Approximate Dollar Value of Shares That May Yet be Purchased Under the Program
April 1 - 30, 2016	85,645	$	118.75	85,645	$	186,563,378
May 1 - 31, 2016	85,743	121.97		85,743	176,105,137
June 1 - 30, 2016	87,502	126.61		87,502	165,026,549
Total	258,890	$	122.47	258,890	$	165,026,549

(1) Shares were repurchased pursuant to the repurchase program originally announced in December 2012 and amended in August 2015 (i) to increase from $250 million to $500 million the total purchase price of shares that may be repurchased under the program and (ii) to extend the program through December 31, 2017. Authorization of the repurchase program may be modified, suspended, or discontinued at any time.

Item 6. Exhibits

31.1	Certification of Andreas Fibig pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Alison A. Cornell pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32	Certification of Andreas Fibig and Alison A. Cornell pursuant to 18 U.S.C. Section 1350 as adopted pursuant to the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extensions Schema
101.CAL	XBRL Taxonomy Extension Calculation Linkbase
101.DEF	XBRL Taxonomy Extension Definition Linkbase
101.LAB	XBRL Taxonomy Extension Label Linkbase
101.PRE	XBRL Taxonomy Extension Presentation Linkbase

38

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

INTERNATIONAL FLAVORS & FRAGRANCES INC.

Dated:	August 8, 2016	By:	/s/ Andreas Fibig
			Andreas Fibig
			Chairman of the Board and Chief Executive Officer
Dated:	August 8, 2016	By:	/s/ Alison A. Cornell
			Alison A. Cornell
			Executive Vice President and Chief Financial Officer

39

EXHIBIT INDEX

Number	Description
31.1	Certification of Andreas Fibig pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Alison A. Cornell pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32	Certification of Andreas Fibig and Alison A. Cornell pursuant to 18 U.S.C. Section 1350 as adopted pursuant to the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extensions Schema
101.CAL	XBRL Taxonomy Extension Calculation Linkbase
101.DEF	XBRL Taxonomy Extension Definition Linkbase
101.LAB	XBRL Taxonomy Extension Label Linkbase
101.PRE	XBRL Taxonomy Extension Presentation Linkbase

40

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Andreas Fibig, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of International Flavors & Fragrances Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Dated: August 8, 2016
	By:	/s/ Andreas Fibig
	Name:	Andreas Fibig
	Title:	Chairman of the Board and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Alison A. Cornell, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of International Flavors & Fragrances Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Dated: August 8, 2016
	By:	/s/ Alison A. Cornell
	Name:	Alison A. Cornell
	Title:	Executive Vice President and Chief Financial Officer

EX-32

Exhibit 32

CERTIFICATION OF CEO AND CFO PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of International Flavors & Fragrances Inc. (the "Company") for the quarterly period ended June 30, 2016 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Andreas Fibig, as Chief Executive Officer, and Alison A. Cornell, as Chief Financial Officer, each hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his or her knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934;

and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By:	/s/ Andreas Fibig
Name:	Andreas Fibig
Title:	Chairman of the Board and Chief Executive Officer
Dated:	August 8, 2016

By:	/s/ Alison A. Cornell
Name:	Alison A. Cornell
Title:	Executive Vice President and Chief Financial Officer
Dated:	August 8, 2016

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2016	Jul. 26, 2016
Document And Entity Information [Abstract]
Entity Registrant Name	INTERNATIONAL FLAVORS & FRAGRANCES INC
Entity Central Index Key	0000051253
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Jun. 30, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q2
Amendment Flag	false
Entity Common Stock, Shares Outstanding		79,591,844

XML

Consolidated Balance Sheet - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Current Assets:
Cash and cash equivalents	$ 539,992	$ 181,988
Trade receivables (net of allowances of $9,425 and $8,229, respectively)	621,164	537,896
Inventories:
Raw materials	273,424	265,209
Work in process	19,320	17,450
Finished goods	291,745	289,388
Total Inventories	584,489	572,047
Prepaid expenses and other current assets	183,789	145,178
Total Current Assets	1,929,434	1,437,109
Property, plant and equipment, at cost	1,850,356	1,812,283
Accumulated depreciation	(1,113,003)	(1,079,489)
Total Property Plant and Equipment	737,353	732,794
Goodwill	940,544	941,389
Other intangible assets, net	288,837	306,004
Deferred income taxes	139,023	166,323
Other assets	119,437	118,391
Total Assets	4,154,628	3,702,010
Current Liabilities:
Bank borrowings and overdrafts and current portion of long-term debt	133,473	132,349
Accounts payable	255,143	285,501
Accrued payroll and bonus	49,053	48,843
Dividends payable	44,588	44,824
Other current liabilities	205,994	213,639
Total Current Liabilities	688,251	725,156
Long-term debt	1,357,684	935,373
DEFERRED GAIN	41,630	43,260
Retirement liabilities	244,223	242,383
Other liabilities	144,908	160,849
Total Other Liabilities	1,788,445	1,381,865
Commitments and Contingencies
Shareholders' Equity:
Common stock 12 1/2¢ par value; authorized 500,000,000 shares; issued 115,858,190 shares as of June 30, 2016 and December 31, 2015 and outstanding 79,640,930 and 80,022,291 shares as of June 30, 2016 and December 31, 2015	14,470	14,470
Capital in excess of par value	140,355	140,802
Retained earnings	3,750,364	3,604,254
Accumulated other comprehensive loss	(608,310)	(613,440)
Treasury stock, at cost - 36,217,260 shares as of June 30, 2016 and 35,835,899 shares as of December 31, 2015	(1,623,007)	(1,555,769)
Total Shareholders' Equity	1,673,872	1,590,317
Noncontrolling interest	4,060	4,672
Total Shareholders' Equity including noncontrolling interest	1,677,932	1,594,989
Total Liabilities and Shareholders' Equity	$ 4,154,628	$ 3,702,010

XML

Consolidated Balance Sheet (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Statement of Financial Position [Abstract]
Trade receivables allowances	$ 9,425	$ 8,229
Common stock, par value, in dollars per share	$ 0.125	$ 0.125
Common stock, shares authorized	500,000,000	500,000,000
Common stock, shares issued	115,858,190	115,858,190
Common stock, shares outstanding	79,640,930	80,022,291
Treasury stock, shares at cost	36,217,260	35,835,899

XML

Consolidated Statement Of Comprehensive Income - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Income Statement [Abstract]
Net sales	$ 793,478	$ 767,541	$ 1,576,789	$ 1,542,448
Cost of goods sold	427,837	422,501	850,940	851,131
Gross profit	365,641	345,040	725,849	691,317
Research and development expenses	63,252	62,514	126,637	125,976
Selling and administrative expenses	132,784	131,023	256,327	250,018
Amortization of acquisition-related intangibles	5,130	3,040	11,191	4,880
Restructuring and other charges, net	0	(358)	0	(170)
Operating profit	164,475	148,821	331,694	310,613
Interest expense	15,060	11,407	27,539	22,502
Other (income) expense, net	(2,635)	436	(2,792)	(5,275)
Income before taxes	152,050	136,978	306,947	293,386
Taxes on income	35,317	31,604	71,610	59,754
Net income	116,733	105,374	235,337	233,632
Other comprehensive income, after tax:
Foreign currency translation adjustments	(4,689)	17,557	9,389	(32,958)
(Losses) gains on derivatives qualifying as hedges	800	(5,966)	(9,392)	6,117
Pension and postretirement net liability	2,578	5,476	5,133	11,023
Net current period other comprehensive income (loss)	(1,311)	17,067	5,130	(15,818)
Total comprehensive income	$ 115,422	$ 122,441	$ 240,467	$ 217,814
Net income per share - basic, in dollars per share	$ 1.46	$ 1.30	$ 2.94	$ 2.88
Net income per share - diluted, in dollars per share	$ 1.46	$ 1.29	$ 2.93	$ 2.86
Average number of shares outstanding - basic	79,764	80,790	79,809	80,729
Average number of shares outstanding - diluted	80,040	81,192	80,141	81,201
Dividends declared per share, in dollars per share	$ 0.56	$ 0.47	$ 1.12	$ 0.94

XML

Consolidated Statement Of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Cash flows from operating activities:
Net income	$ 235,337	$ 233,632
Adjustments to reconcile to net cash provided by operating activities:
Depreciation and amortization	49,743	41,041
Deferred income taxes	16,543	17,891
(Gain) loss on disposal of assets	(2,910)	14
Stock-based compensation	13,774	12,860
Pension contributions	(39,510)	(57,493)
Changes in assets and liabilities, net of acquisitions:
Trade receivables	(70,361)	(92,329)
Inventories	(7,271)	(9,834)
Accounts payable	(29,167)	27,334
Accruals for incentive compensation	(2,001)	(21,191)
Other current payables and accrued expenses	18,800	21,305
Other assets	(1,346)	(12,417)
Other liabilities	(27,081)	5,505
Net cash provided by operating activities	154,550	166,318
Cash flows from investing activities:
Payments to Acquire Businesses, Net of Cash Acquired	0	188,835
Additions to property, plant and equipment	(43,236)	(37,937)
Proceeds From Termination Of Life Insurance Contracts	0	548
Payments for (Proceeds from) Hedge, Investing Activities	641	(9,735)
Proceeds from disposal of assets	3,630	1,515
Net cash used in investing activities	(40,247)	(214,974)
Cash flows from financing activities:
Cash dividends paid to shareholders	(89,463)	(75,927)
Net change in revolving credit facility borrowings and overdrafts	(138,142)	(30,283)
Deferred financing costs	(4,796)	0
Proceeds from issuance of long-term debt	555,559	86,162
Loss on pre-issuance hedges	(3,244)	0
Proceeds from issuance of stock under stock plans	494	286
Excess tax benefits on stock-based payments	4,431	11,608
Purchase of treasury stock	(71,714)	(38,813)
Net cash provided by (used in) financing activities	253,125	(46,967)
Effect of exchange rate changes on cash and cash equivalents	(9,424)	(5,696)
Net change in cash and cash equivalents	358,004	(101,319)
Cash and cash equivalents at beginning of year	181,988	478,573
Cash and cash equivalents at end of period	539,992	377,254
Interest paid, net of amounts capitalized	24,971	23,827
Income taxes paid	$ 52,719	$ 46,071

XML

Consolidated Financial Statements

6 Months Ended

Jun. 30, 2016

Accounting Policies [Abstract]

Consolidated Financial Statements

Consolidated Financial Statements:

Basis of Presentation

These interim statements and related management’s discussion and analysis should be read in conjunction with the Consolidated Financial Statements and the related notes and management’s discussion and analysis of results of operations, liquidity and capital resources included in our 2015 Annual Report on Form 10-K (“2015 Form 10-K”). These interim statements are unaudited. The year-end balance sheet data included in this Form 10-Q filing was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles in the United States of America. We have historically operated and continue to operate on a 52/53 week fiscal year ending on the Friday closest to the last day of the quarter. For ease of presentation, June 30 and December 31 are used consistently throughout this Form 10-Q and these interim financial statements and related notes to represent the period-end dates. For the 2016 and 2015 quarters, the actual closing dates were July 1, and July 3, respectively. The unaudited interim financial statements include all adjustments (consisting only of normal recurring adjustments) and accruals necessary in the judgment of management for a fair statement of the results for the periods presented. When used herein, the terms “IFF,” the “Company,” “we,” “us” and “our” mean International Flavors & Fragrances Inc. and its consolidated subsidiaries.

Reclassifications and Revisions

Certain prior year amounts have been reclassified and revised to conform with current year presentation.

The Consolidated Balance Sheet as of December 31, 2015, has been revised to properly reflect in-bound goods in transit. Accordingly, Inventory and Accounts payable decreased by $17.0 million. In addition, an adjustment has been made to two line items within net cash provided by operating activities for the 2015 Consolidated Statement of Cash Flows to reflect the previously recorded correction of a balance sheet classification associated with accounts payable and accruals. These adjustments were not material to the Consolidated Statement of Cash Flows.

Recent Accounting Pronouncements

In March 2016, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance which requires changes to several aspects of the accounting for share-based payment transactions, including the treatment of income tax consequences, classification of awards as either equity or liabilities, and classification of certain items on the statement of cash flows. This guidance will be effective for annual and interim periods beginning after December 15, 2016. Early adoption will be permitted for all entities. Among other changes, the standard requires that employee taxes paid when an employer withholds shares be presented in the Consolidated Statement of Cash Flows as a financing activity instead of an operating activity. The Company expects to adopt this change retroactively and that the impact on the Consolidated Statement of Cash Flows will be approximately $20-$25 million on an annual basis. The Company is currently evaluating the other changes required by the standard.

In February 2016, the FASB issued authoritative guidance which requires changes to the accounting for leases. The new guidance establishes a new lease accounting model, that, for all companies, requires entities to record assets and liabilities related to leases on the balance sheet for certain types of leases. The guidance will be effective for annual and interim periods beginning after December 31, 2018. Early adoption will be permitted for all entities. The Company expects the adoption of this guidance will result in significant increases to assets and liabilities on its Consolidated Balance Sheet and is still evaluating the impact on its Consolidated Statement of Comprehensive Income.

In September 2015, the FASB issued authoritative guidance relating to the adjustments made during the measurement period for items in a business combination. Specifically, the new guidance requires adjustments related to the finalization of estimates to be recorded in the period when they are determined and to provide certain additional disclosures. This guidance is effective for fiscal years beginning after December 15, 2015. The Company adopted this guidance during 2016 and the adoption did not have a significant impact on its consolidated financial statements.

In April 2015, the FASB issued authoritative guidance which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability. This guidance is effective for annual and interim periods beginning after December 15, 2015. The Company adopted this guidance retroactively in 2016 and accordingly has reclassified all debt issuance costs on long-term debt as a direct deduction from the carrying amount of the debt liability in the Consolidated Balance Sheet as of December 31, 2015. The adoption of this guidance did not have a significant impact on its consolidated financial statements.

In May 2014, the FASB issued authoritative guidance to clarify the principles to be used to recognize revenue and made subsequent clarifications under the new requirements during May 2016. The guidance is applicable to all entities and is effective for annual and interim periods beginning after December 15, 2017. Adoption as of the original effective date is permitted. The Company is currently evaluating the impact that this new standard will have on its consolidated financial statements.

Accounts Receivable

The Company sells certain accounts receivable on a non-recourse basis to unrelated financial institutions under “factoring” agreements that are sponsored, solely and individually, by certain customers. The Company accounts for these transactions as sales of receivables, removes the receivables sold from its financial statements, and records cash proceeds when received by the Company. The beneficial impact on cash from operations from participating in these programs increased approximately $17.7 million for the six months ended June 30, 2016 compared to an increase of approximately $1.3 million for the six months ended June 30, 2015. The cost of participating in these programs was immaterial to our results in all periods.

XML

Net Income Per Share

6 Months Ended

Jun. 30, 2016

Earnings Per Share [Abstract]

Net Income Per Share

Net Income Per Share:

Net income per share is based on the weighted average number of shares outstanding. A reconciliation of the shares used in the computation of basic and diluted net income per share is as follows:

	Three Months Ended June 30,		Six Months Ended June 30,
(SHARES IN THOUSANDS)	2016	2015	2016	2015
Basic	79,764	80,790	79,809	80,729
Assumed dilution under stock plans	276	402	332	472
Diluted	80,040	81,192	80,141	81,201

An immaterial amount of stock-settled appreciation rights (“SSARs”) were excluded from the computation of diluted net income per share for the three and six months ended June 30, 2016. There were no stock options or SSARs excluded from the 2015 periods.

The Company has issued shares of purchased restricted common stock (“PRS”) which contain rights to nonforfeitable dividends while these shares are outstanding and thus are considered participating securities. Such securities are required to be included in the computation of basic and diluted earnings per share pursuant to the two-class method. The Company did not present the two-class method since the difference between basic and diluted net income per share for both unrestricted common shareholders and PRS shareholders was less than $0.01 per share for each period presented, and the number of PRS outstanding as of June 30, 2016 and 2015 was immaterial. Net income allocated to such PRS was $0.3 million and $0.5 million for the three months ended June 30, 2016 and 2015, respectively and $0.5 million and $1.1 million during the six months ended June 30, 2016 and 2015, respectively.

XML

Acquisitions

6 Months Ended

Jun. 30, 2016

Business Combinations [Abstract]

Acquisitions

Acquisitions:

2015 Activity

Lucas Meyer

During the third quarter of 2015, the Company completed the acquisition of 100% of the outstanding shares of Lucas Meyer Cosmetics, a business of Unipex Group ("Lucas Meyer"). The total shares acquired include shares effectively acquired pursuant to put and call option agreements. The acquisition was accounted for under the purchase method. Total consideration was approximately Euro 284.0 million ($312.1 million), including approximately $4.8 million of cash acquired. The Company paid Euro 282.1 million (approximately $309.9 million) for the acquisition, which was funded from existing resources, and recorded a liability of approximately Euro 2.0 million (approximately $2.2 million) for shares to be purchased under the put and call option agreements. The purchase price exceeded the fair value of existing net assets by approximately $290.1 million. The excess was allocated principally to identifiable intangible assets (approximately $156.4 million), goodwill (approximately $179.5 million) and approximately $38.1 million to deferred taxes. Goodwill represents the excess of the purchase price over the fair value of net assets acquired. Separately identifiable intangible assets are principally related to customer relationships, proprietary technology and patents. The intangible assets are being amortized over the following estimated useful lives: trade names and proprietary technology, 28 years; customer relationships, 23 years; patents, 11 years; and non-solicitation agreements, 3 years.

No pro forma financial information for 2016 is presented as the impact of the acquisition was immaterial to the Consolidated Statement of Comprehensive Income. During the second quarter of 2016, the purchase price allocation was updated, however, none of the changes were material to the consolidated financial statements. The purchase price allocation was completed during the second quarter of 2016.

Ottens Flavors

During the second quarter of 2015, the Company completed the acquisition of 100% of the outstanding shares of Henry H. Ottens Manufacturing Co., Inc. ("Ottens Flavors"). The acquisition was accounted for under the purchase method. The Company paid $198.9 million (including $10.4 million of cash acquired) for this acquisition, which was funded from existing resources. The purchase price allocation was completed during the fourth quarter of 2015. No pro forma financial information for 2016 is presented as the impact of the acquisition was not material to the consolidated financial statements.

XML

Goodwill and Other Intangible Assets, Net Goodwill and Other Intangible Assets, Net (Notes)

6 Months Ended

Jun. 30, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets, Net

Other Intangible Assets, Net:

Goodwill

Movements in goodwill during 2016 were as follows:

(DOLLARS IN THOUSANDS)	Goodwill
Balance at December 31, 2015	$	941,389
Foreign exchange	3,229
Other	(4,074		)
Balance at June 30, 2016	$	940,544

The decrease reflected in Other above is the impact of finalizing the purchase price allocation of Lucas Meyer as disclosed in Note 3.

Other Intangible Assets

Other intangible assets, net consist of the following amounts:

	June 30,			December 31,
(DOLLARS IN THOUSANDS)	2016			2015
Cost
Customer relationships	$	289,743		$	293,799
Trade names & patents	31,554			34,182
Technological know-how	111,808			112,393
Other	24,072			22,711
Total carrying value	457,177			463,085
Accumulated Amortization
Customer relationships	(74,061		)	(66,324		)
Trade names & patents	(11,272		)	(10,282		)
Technological know-how	(66,618		)	(65,258		)
Other	(16,389		)	(15,217		)
Total accumulated amortization	(168,340		)	(157,081		)
Other intangible assets, net	$	288,837		$	306,004

Amortization

Amortization expense was $5.1 million and $3.0 million for the three months ended June 30, 2016 and 2015, respectively and $11.2 million and $4.9 million for the six months ended June 30, 2016 and 2015, respectively. Annual amortization is expected to be $21.8 million for the full year 2016, $21.4 million for the year 2017, $21.2 million for the year 2018, $20.0 million for the year 2019, $19.3 million for the year 2020 and $15.1 million for the year 2021.

XML

Restructuring and Other Charges, Net

6 Months Ended

Jun. 30, 2016

Restructuring and Related Activities [Abstract]

Restructuring and Other Charges, Net

Restructuring and Other Charges, Net:

During the fourth quarter of 2015, the Company established a series of initiatives intended to streamline its management structure, simplify decision-making and accountability, better leverage and align its capabilities across the organization and improve efficiency of its global manufacturing and operations network. As a result, in the fourth quarter of 2015, the Company recorded a pre-tax charge of $7.6 million, included in restructuring and other charges, net, related to severance and related costs pertaining to approximately 150 positions that will be affected. During the second quarter of 2016, the Company made payments of $1.4 million and recorded accelerated depreciation expense of $0.3 million. The total cost of the plan is expected to be approximately $10.5 million with the remaining charges relating principally to accelerated depreciation. The Company expects the plan to be fully implemented in the second half of 2017.

Changes in employee-related restructuring liabilities during the six months ended June 30, 2016, were as follows:

(DOLLARS IN THOUSANDS)	Employee-Related Costs			Accelerated Depreciation			Total
Balance at December 31, 2015	$	7,882		$	—		$	7,882
Additional charges (reversals), net	—			283			283
Non-cash charges	—			(283		)	(283		)
Payments and other costs	(1,446		)	—			(1,446		)
Balance at June 30, 2016	$	6,436		$	—		$	6,436

XML

Borrowings

6 Months Ended

Jun. 30, 2016

Debt Disclosure [Abstract]

Borrowings

Borrowings:

Debt consists of the following:

(DOLLARS IN THOUSANDS)	Rate		Maturities	June 30, 2016			December 31, 2015
Senior notes - 2006 (1)	6.14	%	2016	$	124,991		$	124,964
Senior notes - 2007 (1)	6.40	%	2017-27	499,618			499,618
Senior notes - 2013 (1)	3.20	%	2023	297,846			297,683
Euro Senior notes - 2016 (1)	1.75	%	2024	550,598			—
Credit facility	2.67	%	2019	—			131,196
Bank overdrafts and other				15,791			10,982
Deferred realized gains on interest rate swaps				2,313			3,279
				1,491,157			1,067,722
Less: Current portion of long-term debt				(133,473		)	(132,349		)
				$	1,357,684		$	935,373

⁽¹⁾ Amount is net of unamortized discount and debt issuance costs.

On March 14, 2016, the Company issued Euro 500.0 million face amount of 1.75% Senior Notes ("Euro Senior Notes - 2016") due 2024 at a discount of Euro 0.9 million. The Company received proceeds related to the issuance of these Euro Senior Notes - 2016 of Euro 496.0 million which was net of the Euro 0.9 million discount and Euro 3.1 million underwriting discount (recorded as deferred financing costs). In addition, the Company incurred $1.3 million of other deferred financing costs in connection with the debt issuance. In connection with the debt issuance, the Company entered into pre-issuance hedging transactions that were settled upon issuance of the debt and resulted in a loss of approximately $3.2 million as of June 30, 2016. The discount, deferred financing costs and pre-issuance hedge loss are being amortized as interest expense over the 8 year term of the debt. The Euro Senior Notes - 2016 bear interest at a rate of 1.75% per annum, with interest payable on March 14 of each year, commencing on March 14, 2017. The Euro Senior Notes - 2016 will mature on March 14, 2024.

Upon 30 days’ notice to holders of the Euro Senior Notes - 2016 , the Company may redeem the Euro Senior Notes - 2016 for cash in whole, at any time, or in part, from time to time, prior to maturity, at redemption prices that include accrued and unpaid interest and a make-whole premium, as specified in the indenture governing the Euro Senior Notes - 2016. However, no make-whole premium will be paid for redemptions of the Euro Senior Notes - 2016 on or after December 14, 2023. The indenture provides for customary events of default and contains certain negative covenants that limit the ability of the Company and its subsidiaries to grant liens on assets, or to enter into sale-leaseback transactions. In addition, subject to certain limitations, in the event of the occurrence of both (1) a change of control of the Company and (2) a downgrade of the Euro Senior Notes - 2016 below investment grade rating by both Moody’s Investors Services, Inc. and Standard & Poor’s Ratings Services within a specified time period, the Company will be required to make an offer to repurchase the Notes at a price equal to 101% of the principal amount of the Euro Senior Notes - 2016, plus accrued and unpaid interest to the date of repurchase.

As discussed in Note 11, the Euro Senior Notes - 2016 have been designated as a hedge of the Company's net investment in certain subsidiaries.

On July 12, 2016, the Company made a payment of $125.0 million related to our Senior Notes - 2006.

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Income Taxes

6 Months Ended

Jun. 30, 2016

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes:

Uncertain Tax Positions

At June 30, 2016, the Company had $25.1 million of unrecognized tax benefits recorded in Other liabilities. If these unrecognized tax benefits were recognized, the effective tax rate would be affected.

At June 30, 2016, the Company had accrued interest and penalties of $0.9 million classified in Other liabilities.

As of June 30, 2016, the Company’s aggregate provisions for uncertain tax positions, including interest and penalties, was$26.0 million associated with various tax positions asserted in foreign jurisdictions, none of which is individually material.

The Company regularly repatriates a portion of current year earnings from select non–U.S. subsidiaries. No provision is made for additional taxes on undistributed earnings of subsidiary companies that are intended and planned to be indefinitely invested in such subsidiaries. We intend to, and have plans to, reinvest these earnings indefinitely in our foreign subsidiaries to fund local operations and/or capital projects.

The Company has ongoing income tax audits and legal proceedings which are at various stages of administrative or judicial review. In addition, the Company has open tax years with various taxing jurisdictions that range primarily from 2006 to 2015. Based on currently available information, we do not believe the ultimate outcome of any of these tax audits and other tax positions related to open tax years, when finalized, will have a material impact on our financial position.

The Company also has other ongoing tax audits and legal proceedings that relate to indirect taxes, such as value-added taxes, sales and use taxes and property taxes, which are discussed in Note 13.

Effective Tax Rate

The effective tax rate for the three months ended June 30, 2016 was 23.2% compared with 23.1% for the three months ended June 30, 2015. The quarter-over-quarter increase was largely due to higher loss provisions partially offset by lower cost of repatriation. The effective tax rate for the six months ended June 30, 2016 was 23.3% compared with 20.4% for the six months ended June 30, 2015. The year-over-year increase was primarily due to a benefit of $10.5 million recorded in the first quarter of 2015, as a result of favorable tax rulings in Spain and another jurisdiction for which reserves were previously recorded and higher loss provisions in 2016, partially offset by lower cost of repatriation in the 2016 period.

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Stock Compensation Plans

6 Months Ended

Jun. 30, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock Compensation Plans

Stock Compensation Plans:

The Company has various plans under which its officers, senior management, other key employees and directors may be granted equity-based awards. Equity awards outstanding under the plans include PRS, purchased restricted stock units, restricted stock units ("RSUs"), stock options, SSARs and Long-Term Incentive Plan awards; liability-based awards outstanding under the plans are cash-settled RSUs.

Stock-based compensation expense and related tax benefits were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Equity-based awards	$	7,844		$	7,473		$	13,774		$	12,860
Liability-based awards	1,739			666			2,332			2,573
Total stock-based compensation expense	9,583			8,139			16,106			15,433
Less: tax benefit	(2,816		)	(2,225		)	(4,789		)	(4,412		)
Total stock-based compensation expense, after tax	$	6,767		$	5,914		$	11,317		$	11,021

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Segment Information

6 Months Ended

Jun. 30, 2016

Segment Reporting [Abstract]

Segment Information

Segment Information:

The Company is organized into two operating segments: Flavors and Fragrances. These segments align with the internal structure of the Company used to manage these businesses. Performance of these operating segments is evaluated based on segment profit which is defined as operating profit before Restructuring and other charges, net, Global expenses (as discussed below) and certain non-recurring items, Interest expense, Other income (expense), net and Taxes on income.

The Global expenses caption below represents corporate and headquarters-related expenses which include legal, finance, human resources, certain incentive compensation expenses and other R&D and administrative expenses that are not allocated to individual operating segments.

Reportable segment information is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Net sales:
Flavors	$	379,504		$	372,478		$	752,012		$	749,586
Fragrances	413,974			395,063			824,777			792,862
Consolidated	$	793,478		$	767,541		$	1,576,789		$	1,542,448
Segment profit:
Flavors	$	90,337		$	84,015		$	182,151		$	176,743
Fragrances	87,596			79,924			176,833			161,522
Global expenses	(12,232		)	(8,629		)	(26,141		)	(20,194		)
Restructuring and other charges, net (1)	(182		)	358			(283		)	170
Acquisition and related costs (2)	(213		)	(6,566		)	(1,249		)	(7,066		)
Operational improvement initiative costs (3)	(831		)	(281		)	(1,099		)	(562		)
Spanish capital tax settlement (4)	—			—			1,482			—
Operating profit	164,475			148,821			331,694			310,613
Interest expense	(15,060		)	(11,407		)	(27,539		)	(22,502		)
Other income (expense)	2,635			(436		)	2,792			5,275
Income before taxes	$	152,050		$	136,978		$	306,947		$	293,386

(1) Restructuring and other charges, net relate to accelerated depreciation costs in Europe recorded in Cost of goods sold.

(2) Acquisition and related costs are associated with the 2015 acquisition of Lucas Meyer as discussed in Note 3, including inventory step-up charges related to the inventory acquired.

(3) Operational improvement initiative costs relate to accelerated depreciation and severance costs in Asia in the 2016 period and accelerated depreciation in the 2015 period.

(4) The Spanish capital tax settlement represents interest received from the Spanish government related to the reversal of the unfavorable ruling the Spanish capital tax case from 2002, which was reversed during the year ended December 31, 2015.

Net sales are attributed to individual regions based upon the destination of product delivery. Net sales related to the U.S. for the three months ended June 30, 2016 and 2015 were $185 million and $174 million, respectively and for the six months ended June 30, 2016 and 2015 were $365 million and $338 million, respectively. Net sales attributed to all foreign countries in total for the three months ended June 30, 2016 and 2015 were $608 million and $594 million, respectively and for the six months ended June 30, 2016 and 2015 were $1,212 million and $1,204 million, respectively. No country other than the U.S. had net sales in any period presented greater than 10% of total consolidated net sales.

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Employee Benefits

6 Months Ended

Jun. 30, 2016

Compensation and Retirement Disclosure [Abstract]

Employee Benefits

Employee Benefits:

Pension and other defined contribution retirement plan expenses included the following components:

U.S. Plans	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Service cost for benefits earned	$	772		$	984		$	1,543		$	1,968
Interest cost on projected benefit obligation	6,006			5,954			12,013			11,907
Expected return on plan assets	(8,070		)	(8,083		)	(16,139		)	(16,165		)
Net amortization and deferrals	1,385			5,203			2,772			10,406
Net periodic benefit cost	93			4,058			189			8,116
Defined contribution and other retirement plans	2,211			2,093			4,612			4,228
Total expense	$	2,304		$	6,151		$	4,801		$	12,344
Non-U.S. Plans	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Service cost for benefits earned	$	3,863		$	4,102		$	7,638		$	8,485
Interest cost on projected benefit obligation	6,372			6,151			12,737			12,543
Expected return on plan assets	(11,985		)	(12,440		)	(23,934		)	(25,390		)
Net amortization and deferrals	3,286			3,314			6,550			6,801
Net periodic benefit cost	1,536			1,127			2,991			2,439
Defined contribution and other retirement plans	1,763			1,693			3,470			3,288
Total expense	$	3,299		$	2,820		$	6,461		$	5,727

The Company expects to contribute a total of approximately $30 million to its non-U.S. pension plans during 2016. During the six months ended June 30, 2016, $20.0 million of contributions were made to the qualified U.S. pension plans, $17.3 million of contributions were made to the non U.S. plans and $2.2 million of benefit payments were made with respect to the Company's non-qualified U.S. pension plan.

Expense recognized for postretirement benefits other than pensions included the following components:

	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Service cost for benefits earned	$	214		$	301		$	429		$	601
Interest cost on projected benefit obligation	787			1,082			1,574			2,164
Net amortization and deferrals	(1,355		)	(712		)	(2,710		)	(1,423		)
Total postretirement benefit (income) expense	$	(354	)	$	671		$	(707	)	$	1,342

The Company expects to contribute approximately $5 million to its postretirement benefits other than pension plans during 2016. In the six months ended June 30, 2016, $2.6 million of contributions were made.

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Financial Instruments

6 Months Ended

Jun. 30, 2016

Investments, All Other Investments [Abstract]

Financial Instruments

Financial Instruments:

Fair Value

Accounting guidance on fair value measurements specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions. These two types of inputs create the following fair value hierarchy:

• Level 1–Quoted prices for identical instruments in active markets.

• Level 2–Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets.

• Level 3–Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

This hierarchy requires us to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. We determine the fair value of structured liabilities (where performance is linked to structured interest rates, inflation or currency risks) using the LIBOR swap curve and forward interest and exchange rates at period end. Such instruments are classified as Level 2 based on the observability of significant inputs to the model. We do not have any instruments classified as Level 1 or Level 3, other than those included in pension asset trusts as discussed in Note 13 of our 2015 Form 10-K.

These valuations take into consideration our credit risk and our counterparties’ credit risk. The estimated change in the fair value of these instruments due to such changes in our own credit risk (or instrument-specific credit risk) was immaterial as of June 30, 2016.

The amounts recorded in the balance sheet (carrying amount) and the estimated fair values of financial instruments at June 30, 2016 and December 31, 2015 consisted of the following:

	June 30, 2016				December 31, 2015
(DOLLARS IN THOUSANDS)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Cash and cash equivalents (1)	$	539,992	$	539,992	$	181,988	$	181,988
Credit facilities and bank overdrafts (2)	15,791		15,791		142,178		142,178
Long-term debt: (3)
Senior notes - 2006	124,991		125,225		124,964		127,717
Senior notes - 2007	499,618		578,590		499,618		563,855
Senior notes - 2013	297,846		312,847		297,683		290,830
Euro Senior notes - 2016	550,598		584,953		—		—

(1) The carrying amount of cash and cash equivalents approximates fair value due to the short maturity of those instruments.

(2) The carrying amount of our credit facilities and bank overdrafts approximates fair value as the interest rate is reset frequently based on current market rates as well as the short maturity of those instruments.

(3) The fair value of our long-term debt was calculated using discounted cash flows applying current interest rates and current credit spreads based on our own credit risk.

Derivatives

The Company periodically enters into foreign currency forward contracts with the objective of reducing exposure to cash flow volatility associated with our intercompany loans, foreign currency receivables and payables, and anticipated purchases of certain raw materials used in operations. These contracts generally involve the exchange of one currency for a second currency at a future date, have maturities not exceeding twelve months and are with counterparties which are major international financial institutions.

During the six months ended June 30, 2016 and the year ended December 31, 2015, the Company entered into several forward currency contracts which qualified as net investment hedges, in order to mitigate a portion of our net European investments from foreign currency risk. The effective portions of net investment hedges are recorded in Other comprehensive income (“OCI”) as a component of Foreign currency translation adjustments in the accompanying Consolidated Statement of Comprehensive Income. Realized gains (losses) are deferred in accumulated other comprehensive income ("AOCI") where they will remain until the net investments in our European subsidiaries are divested. The outstanding forward currency contracts have remaining maturities of approximately one year. Eight of these forward currency contracts matured during the six months ended June 30, 2016.

Subsequent to the issuance of the Euro Senior Notes - 2016 during the first quarter of 2016, the Company designated the debt as a hedge of a portion of its net European investments. Accordingly, the change in the value of the debt that is attributable to foreign exchange movements is recorded in OCI as a component of Foreign currency translation adjustments in the accompanying Consolidated Statement of Comprehensive Income.

During the six months ended June 30, 2016 and the year ended December 31, 2015, the Company entered into several forward currency contracts which qualified as cash flow hedges. The objective of these hedges is to protect against the currency risk associated with forecasted U.S. dollar (USD) denominated raw material purchases made by Euro (EUR) functional currency entities which result from changes in the EUR/USD exchange rate. The effective portions of cash flow hedges are recorded in OCI as a component of Gains/(losses) on derivatives qualifying as hedges in the accompanying Consolidated Statement of Comprehensive Income. Realized gains/(losses) in AOCI related to cash flow hedges of raw material purchases are recognized as a component of Cost of goods sold in the accompanying Consolidated Statement of Comprehensive Income in the same period as the related costs are recognized.

During 2015 and 2014, the Company entered into interest rate swap agreements that effectively converted the fixed rate on a portion of our long-term borrowings to a variable short-term rate based on the LIBOR plus an interest markup. These swaps are designated as fair value hedges. Amounts recognized in Interest expense were immaterial for the three and six months ended June 30, 2016.

During the first quarter of 2016, the Company entered into and terminated two Euro interest rate swap agreements to hedge the anticipated issuance of fixed-rate debt. These swaps were designated as cash flow hedges. The effective portions of cash flow hedges are recorded in OCI as a component of Losses on derivatives qualifying as hedges in the accompanying Consolidated Statement of Comprehensive Income. The Company incurred a loss of Euro 2.9 million ($3.2 million) due to the termination of these swaps. The loss will be amortized as interest expense over the life of the Euro Senior Notes - 2016 as discussed in Note 6.

The following table shows the notional amount of the Company’s derivative instruments outstanding as of June 30, 2016 and December 31, 2015:

(DOLLARS IN THOUSANDS)	June 30, 2016		December 31, 2015
Foreign currency contracts	$	805,900	$	573,200
Interest rate swaps	$	475,000	$	475,000

The following tables show the Company’s derivative instruments measured at fair value (Level 2 of the fair value hierarchy), as reflected in the Consolidated Balance Sheets as of June 30, 2016 and December 31, 2015:

	June 30, 2016
(DOLLARS IN THOUSANDS)	Fair Value of Derivatives Designated as Hedging Instruments		Fair Value of Derivatives Not Designated as Hedging Instruments		Total Fair Value
Derivative assets (a)
Foreign currency contracts	$	4,038	$	12,159	$	16,197
Interest rate swaps	4,341		—		4,341
	$	8,379	$	12,159	$	20,538
Derivative liabilities (b)
Foreign currency contracts	$	1,353	$	9,274	$	10,627
	$	1,353	$	9,274	$	10,627

	December 31, 2015
(DOLLARS IN THOUSANDS)	Fair Value of Derivatives Designated as Hedging Instruments		Fair Value of Derivatives Not Designated as Hedging Instruments		Total Fair Value
Derivative assets (a)
Foreign currency contracts	$	6,560	$	3,700	$	10,260
Interest rate swaps	1,210		—		1,210
	$	7,770	$	3,700	$	11,470
Derivative liabilities (b)
Foreign currency contracts	$	2,106	$	3,022	$	5,128

(a) Derivative assets are recorded to Prepaid expenses and other current assets in the Consolidated Balance Sheet.

(b) Derivative liabilities are recorded as Other current liabilities in the Consolidated Balance Sheet.

The following table shows the effect of the Company’s derivative instruments which were not designated as hedging instruments in the Consolidated Statement of Comprehensive Income for the three and six months ended June 30, 2016 and 2015 (in thousands):

Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income on Derivative					Location of Gain (Loss) Recognized in Income on Derivative
	Three Months Ended June 30,
	2016			2015
Foreign currency contracts	$	1,395		$	371	Other (income) expense, net
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income on Derivative					Location of Gain (Loss) Recognized in Income on Derivative
	Six Months Ended June 30,
	2016			2015
Foreign currency contracts	$	(3,548	)	$	10,075	Other (income) expense, net

Most of these net gains (losses) offset any recognized gains (losses) arising from the revaluation of the related intercompany loans during the same respective periods.

The following table shows the effect of the Company’s derivative instruments designated as cash flow and net investment hedging instruments in the Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2016 and 2015 (in thousands):

	Amount of (Loss) Gain Recognized in OCI on Derivative (Effective Portion)						Location of (Loss) Gain Reclassified from AOCI into Income (Effective Portion)	Amount of (Loss) Gain Reclassified from Accumulated OCI into Income (Effective Portion)
	Three Months Ended June 30,							Three Months Ended June 30,
	2016			2015				2016			2015
Derivatives in Cash Flow Hedging Relationships:
Foreign currency contracts	$	612		$	(6,035	)	Cost of goods sold	$	2,736		$	3,561
Interest rate swaps (1)	171			69			Interest expense	(171		)	(69		)
Derivatives in Net Investment Hedging Relationships:
Foreign currency contracts	1,934			(1,030		)	N/A	—			—
Euro Senior notes - 2016	9,649			—			N/A	—			—
Total	$	12,366		$	(6,996	)		$	2,565		$	3,492
	Amount of (Loss) Gain Recognized in OCI on Derivative (Effective Portion)						Location of (Loss) Gain Reclassified from AOCI into Income (Effective Portion)	Amount of (Loss) Gain Reclassified from Accumulated OCI into Income (Effective Portion)
	Six Months Ended June 30,							Six Months Ended June 30,
	2016			2015				2016			2015
Derivatives in Cash Flow Hedging Relationships:
Foreign currency contracts	$	(6,391	)	$	5,979		Cost of goods sold	$	5,352		$	4,584
Interest rate swaps (1)	(3,001		)	138			Interest expense	(257		)	(138		)
Derivatives in Net Investment Hedging Relationships:
Foreign currency contracts	(470		)	3,531			N/A	—			—
Euro Senior notes - 2016	9,649			—			N/A	—			—
Total	$	(213	)	$	9,648			$	5,095		$	4,446

(1) Interest rate swaps were entered into as pre-issuance hedges.

No ineffectiveness was experienced in the above noted cash flow or net investment hedges during the three and six months ended June 30, 2016 and 2015.

The Company expects that approximately $1.7 million (net of tax) of derivative losses included in AOCI at June 30, 2016, based on current market rates, will be reclassified into earnings within the next 12 months. The majority of this amount will vary due to fluctuations in foreign currency exchange rates.

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Accumulated Other Comprehensive Income (Loss)

6 Months Ended

Jun. 30, 2016

Equity [Abstract]

Accumulated Other Comprehensive Income (Loss)

Accumulated Other Comprehensive Income (Loss):

The following tables present changes in the accumulated balances for each component of other comprehensive income, including current period other comprehensive income and reclassifications out of accumulated other comprehensive income:

	Foreign Currency Translation Adjustments			(Losses) Gains on Derivatives Qualifying as Hedges			Pension and Postretirement Liability Adjustment			Total
(DOLLARS IN THOUSANDS)
Accumulated other comprehensive (loss) income, net of tax, as of December 31, 2015	$	(297,499	)	$	9,401		$	(325,342	)	$	(613,440	)
OCI before reclassifications	9,389			(4,297		)	—			5,092
Amounts reclassified from AOCI	—			(5,095		)	5,133			38
Net current period other comprehensive income (loss)	9,389			(9,392		)	5,133			5,130
Accumulated other comprehensive (loss) income, net of tax, as of June 30, 2016	$	(288,110	)	$	9		$	(320,209	)	$	(608,310	)

	Foreign Currency Translation Adjustments			(Losses) Gains on Derivatives Qualifying as Hedges			Pension and Postretirement Liability Adjustment			Total
(DOLLARS IN THOUSANDS)
Accumulated other comprehensive (loss) income, net of tax, as of December 31, 2014	$	(173,342	)	$	12,371		$	(379,459	)	$	(540,430	)
OCI before reclassifications	(32,958		)	10,563			—			(22,395		)
Amounts reclassified from AOCI	—			(4,446		)	11,023			6,577
Net current period other comprehensive income (loss)	(32,958		)	6,117			11,023			(15,818		)
Accumulated other comprehensive (loss) income, net of tax, as of June 30, 2015	$	(206,300	)	$	18,488		$	(368,436	)	$	(556,248	)

The following table provides details about reclassifications out of accumulated other comprehensive income to the Consolidated Statement of Comprehensive Income:

	Six Months Ended June 30, 2016			Six Months Ended June 30, 2015			Affected Line Item in the Consolidated Statement of Comprehensive  Income
(DOLLARS IN THOUSANDS)
(Losses) gains on derivatives qualifying as hedges
Foreign currency contracts	$	6,117		$	5,239		Cost of goods sold
Interest rate swaps	(257		)	(138		)	Interest expense
	(765		)	(655		)	Provision for income taxes
	$	5,095		$	4,446		Total, net of income taxes
(Losses) gains on pension and postretirement liability adjustments
Prior service cost	$	3,735		$	2,318		(a)
Actuarial losses	(10,347		)	(18,102		)	(a)
	1,479			4,761			Provision for income taxes
	$	(5,133	)	$	(11,023	)	Total, net of income taxes

(a) The amortization of prior service cost and actuarial loss is included in the computation of net periodic benefit cost. Refer to Note 14 of our 2015 Form 10-K for additional information regarding net periodic benefit cost.

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2016

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies:

Guarantees and Letters of Credit

The Company has various bank guarantees and letters of credit which are available for use to support its ongoing business operations and to satisfy governmental requirements associated with pending litigation in various jurisdictions.

At June 30, 2016, we had total bank guarantees and standby letters of credit of approximately $38.4 million with various financial institutions. Included in the above aggregate amount is a total of $16.2 million in bank guarantees which the Company has posted for certain assessments in Brazil for other diverse income tax and indirect tax disputes related to fiscal years 1998-2011. There were no material amounts utilized under the standby letters of credit as of June 30, 2016.

In order to challenge the assessments in these cases in Brazil, the Company has been required to, and has separately pledged assets, principally property, plant and equipment, to cover assessments in the amount of approximately $13.4 million as of June 30, 2016.

Lines of Credit

The Company has various lines of credit which are available to support its ongoing business operations. At June 30, 2016, we had available lines of credit (in addition to the $950 million of capacity under the Credit Facility discussed in Note 8 of our 2015 Form 10-K) of approximately $76.6 million with various financial institutions. There were no significant amounts drawn down pursuant to these lines of credit as of June 30, 2016.

Litigation

The Company assesses contingencies related to litigation and/or other matters to determine the degree of probability and range of possible loss. A loss contingency is accrued in the Company’s consolidated financial statements if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Because litigation is inherently unpredictable and unfavorable resolutions could occur, assessing contingencies is highly sensitive and requires judgments about future events. On at least a quarterly basis, the Company reviews contingencies related to litigation to determine the adequacy of accruals. The amount of ultimate loss may differ from these estimates and further events may require the Company to increase or decrease the amounts it has accrued on any matter.

Periodically, we assess our insurance coverage for all known claims, where applicable, taking into account aggregate coverage by occurrence, limits of coverage, self-insured retentions and deductibles, historical claims experience and claims experience with our insurance carriers. The liabilities are recorded at management’s best estimate of the probable outcome of the lawsuits and claims, taking into consideration the facts and circumstances of the individual matters as well as past experience on similar matters. At each balance sheet date, the key issues that management assesses are whether it is probable that a loss as to asserted or unasserted claims has been incurred and if so, whether the amount of loss can be reasonably estimated. We record the expected liability with respect to claims in Other liabilities and expected recoveries from our insurance carriers in Other assets. We recognize a receivable when we believe that realization of the insurance receivable is probable under the terms of the insurance policies and our payment experience to date.

Environmental

Over the past 20 years, various federal and state authorities and private parties have claimed that we are a Potentially Responsible Party (“PRP”) as a generator of waste materials for alleged pollution at a number of waste sites operated by third parties located principally in New Jersey and have sought to recover costs incurred and to be incurred to clean up the sites.

We have been identified as a PRP at eight facilities operated by third parties at which investigation and/or remediation activities may be ongoing. We analyze our potential liability on at least a quarterly basis. We accrue for environmental liabilities when they are probable and estimable. We estimate our share of the total future cost for these sites to be less than $5 million.

While joint and several liability is authorized under federal and state environmental laws, we believe the amounts we have paid and anticipate paying in the future for clean-up costs and damages at all sites are not material and will not have a material adverse effect on our financial condition, results of operations or liquidity. This assessment is based upon, among other things, the involvement of other PRPs at most of the sites, the status of the proceedings, including various settlement agreements and consent decrees, and the extended time period over which payments will likely be made. There can be no assurance, however, that future events will not require us to materially increase the amounts we anticipate paying for clean-up costs and damages at these sites, and that such increased amounts will not have a material adverse effect on our financial condition, results of operations or cash flows.

China Facilities

Guangzhou Flavors plant

During 2015, the Company was notified by Chinese authorities of compliance issues pertaining to the emission of odors from several of its plants in China. As a result, the Company's Flavors facility in China was temporarily idled. Accordingly, the Company invested approximately $6.5 in odor-abatement equipment at these facilities to address these issues and is in the process of building a second Flavors site in China, which is expected to be completed during 2018.

If the Company is required to close a plant, or operate one at significantly reduced production levels on a permanent basis, the Company may be required to record charges that could have a material impact on its consolidated financial results of operations, financial position and cash flows in future periods.

Zhejiang Ingredients plant

The Company has received a request from the Chinese government to relocate its Fragrance Ingredients plant in Zhejiang, China. The Company is in discussions with the government regarding the timing of the requested relocation and the amount and nature of government compensation to be provided to the Company. The net book value of the current site approximates $25 million. Depending upon the ultimate outcome of these discussions with the Chinese government, between $0-25 million of the remaining net book value may be subject to accelerated depreciation.

Other Contingencies

The Company has contingencies involving third parties (such as labor, contract, technology or product-related claims or litigation) as well as government-related items in various jurisdictions in which we operate pertaining to such items as value-added taxes, other indirect taxes, customs and duties and sales and use taxes. It is possible that cash flows or results of operations, in any period, could be materially affected by the unfavorable resolution of one or more of these contingencies.

The most significant government-related contingencies exist in Brazil. With regard to the Brazilian matters, we believe we have valid defenses for the underlying positions under dispute; however, in order to pursue these defenses, we are required to, and have provided, bank guarantees and pledged assets in the aggregate amount of $29.6 million. The Brazilian matters take an extended period of time to proceed through the judicial process and there are a limited number of rulings to date.

In March 2012, ZoomEssence, Inc. filed a complaint against the Company in the U.S. District Court of New Jersey alleging trade secret misappropriation, breach of contract and unjust enrichment in connection with certain spray dry technology disclosed to the Company. In connection with the claims, ZoomEssence is seeking an injunction and monetary damages. ZoomEssence initially sought a temporary restraining order and preliminary injunction, but the Court denied these applications in an order entered on September 27, 2013, finding that ZoomEssence had not demonstrated a likelihood of success on the merits of its claims. The Court subsequently referred the matter to mediation, however the private mediation session did not result in a resolution of the dispute. On November 3, 2014, ZoomEssence amended its complaint against the Company to include allegations of breach of the duty of good faith and fair dealing, fraud in the inducement, and misappropriation of confidential and proprietary information. On November 13, 2014, the Company filed a counterclaim against ZoomEssence alleging trade secret misappropriation, breach of contract, breach of the implied covenant of good faith and fair dealing, unjust enrichment, misappropriation of confidential and proprietary information, common law unfair competition, tortious interference with contractual relations, and conversion. The case is currently proceeding through discovery with a trial on the merits anticipated in late 2016/early 2017. The Company denies the allegations and will vigorously defend and pursue its position in Court. At this stage of the litigation, based on the information currently available to the Company, management does not believe that this matter represents a material loss contingency.

Based on the information available as of June 30, 2016, we estimate a range of reasonably possible loss related to the matters above, collectively, is $0-$46 million.

Separately, the Spanish tax authorities alleged claims for a capital tax, the Appellate Court rejected one of the two bases upon which we based our capital tax position. On January 22, 2014, we filed an appeal and in order to avoid future interest costs in the event our appeal was unsuccessful, we paid Euro 9.8 million ($11.2 million, representing the principal amount) during the first quarter of 2014. On February 24, 2016, we received a favorable ruling on our appeal from the Spanish Supreme Court which overruled a lower court ruling. As a result of this decision, we have reversed the previously recorded provision of Euro 9.8 million ($10.5 million) for the year ended December 31, 2015. During the second quarter of 2016, we recorded additional income of $1.4 million related to the finalization of amounts expected to be received from the authorities. This amount has been reflected as a reduction of administrative expense.

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Consolidated Financial Statements (Policies)

6 Months Ended

Jun. 30, 2016

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

These interim statements and related management’s discussion and analysis should be read in conjunction with the Consolidated Financial Statements and the related notes and management’s discussion and analysis of results of operations, liquidity and capital resources included in our 2015 Annual Report on Form 10-K (“2015 Form 10-K”). These interim statements are unaudited. The year-end balance sheet data included in this Form 10-Q filing was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles in the United States of America. We have historically operated and continue to operate on a 52/53 week fiscal year ending on the Friday closest to the last day of the quarter. For ease of presentation, June 30 and December 31 are used consistently throughout this Form 10-Q and these interim financial statements and related notes to represent the period-end dates. For the 2016 and 2015 quarters, the actual closing dates were July 1, and July 3, respectively. The unaudited interim financial statements include all adjustments (consisting only of normal recurring adjustments) and accruals necessary in the judgment of management for a fair statement of the results for the periods presented. When used herein, the terms “IFF,” the “Company,” “we,” “us” and “our” mean International Flavors & Fragrances Inc. and its consolidated subsidiaries.

Reclassifications and Revisions

Reclassifications and Revisions

Certain prior year amounts have been reclassified and revised to conform with current year presentation.

The Consolidated Balance Sheet as of December 31, 2015, has been revised to properly reflect in-bound goods in transit. Accordingly, Inventory and Accounts payable decreased by $17.0 million. In addition, an adjustment has been made to two line items within net cash provided by operating activities for the 2015 Consolidated Statement of Cash Flows to reflect the previously recorded correction of a balance sheet classification associated with accounts payable and accruals. These adjustments were not material to the Consolidated Statement of Cash Flows.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In March 2016, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance which requires changes to several aspects of the accounting for share-based payment transactions, including the treatment of income tax consequences, classification of awards as either equity or liabilities, and classification of certain items on the statement of cash flows. This guidance will be effective for annual and interim periods beginning after December 15, 2016. Early adoption will be permitted for all entities. Among other changes, the standard requires that employee taxes paid when an employer withholds shares be presented in the Consolidated Statement of Cash Flows as a financing activity instead of an operating activity. The Company expects to adopt this change retroactively and that the impact on the Consolidated Statement of Cash Flows will be approximately $20-$25 million on an annual basis. The Company is currently evaluating the other changes required by the standard.

In February 2016, the FASB issued authoritative guidance which requires changes to the accounting for leases. The new guidance establishes a new lease accounting model, that, for all companies, requires entities to record assets and liabilities related to leases on the balance sheet for certain types of leases. The guidance will be effective for annual and interim periods beginning after December 31, 2018. Early adoption will be permitted for all entities. The Company expects the adoption of this guidance will result in significant increases to assets and liabilities on its Consolidated Balance Sheet and is still evaluating the impact on its Consolidated Statement of Comprehensive Income.

In September 2015, the FASB issued authoritative guidance relating to the adjustments made during the measurement period for items in a business combination. Specifically, the new guidance requires adjustments related to the finalization of estimates to be recorded in the period when they are determined and to provide certain additional disclosures. This guidance is effective for fiscal years beginning after December 15, 2015. The Company adopted this guidance during 2016 and the adoption did not have a significant impact on its consolidated financial statements.

In April 2015, the FASB issued authoritative guidance which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability. This guidance is effective for annual and interim periods beginning after December 15, 2015. The Company adopted this guidance retroactively in 2016 and accordingly has reclassified all debt issuance costs on long-term debt as a direct deduction from the carrying amount of the debt liability in the Consolidated Balance Sheet as of December 31, 2015. The adoption of this guidance did not have a significant impact on its consolidated financial statements.

In May 2014, the FASB issued authoritative guidance to clarify the principles to be used to recognize revenue and made subsequent clarifications under the new requirements during May 2016. The guidance is applicable to all entities and is effective for annual and interim periods beginning after December 15, 2017. Adoption as of the original effective date is permitted. The Company is currently evaluating the impact that this new standard will have on its consolidated financial statements.

Accounts Receivable

Accounts Receivable

The Company sells certain accounts receivable on a non-recourse basis to unrelated financial institutions under “factoring” agreements that are sponsored, solely and individually, by certain customers. The Company accounts for these transactions as sales of receivables, removes the receivables sold from its financial statements, and records cash proceeds when received by the Company.

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Net Income Per Share (Tables)

6 Months Ended

Jun. 30, 2016

Earnings Per Share [Abstract]

Reconciliation of Shares Used in Computation of Basic and Diluted Net Income Per Share

A reconciliation of the shares used in the computation of basic and diluted net income per share is as follows:

	Three Months Ended June 30,		Six Months Ended June 30,
(SHARES IN THOUSANDS)	2016	2015	2016	2015
Basic	79,764	80,790	79,809	80,729
Assumed dilution under stock plans	276	402	332	472
Diluted	80,040	81,192	80,141	81,201

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Goodwill and Other Intangible Assets, Net (Tables)

6 Months Ended

Jun. 30, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Movements in Goodwill

Movements in goodwill during 2016 were as follows:

(DOLLARS IN THOUSANDS)	Goodwill
Balance at December 31, 2015	$	941,389
Foreign exchange	3,229
Other	(4,074		)
Balance at June 30, 2016	$	940,544

Schedule of Other Intangible Assets, Net

Other intangible assets, net consist of the following amounts:

	June 30,			December 31,
(DOLLARS IN THOUSANDS)	2016			2015
Cost
Customer relationships	$	289,743		$	293,799
Trade names & patents	31,554			34,182
Technological know-how	111,808			112,393
Other	24,072			22,711
Total carrying value	457,177			463,085
Accumulated Amortization
Customer relationships	(74,061		)	(66,324		)
Trade names & patents	(11,272		)	(10,282		)
Technological know-how	(66,618		)	(65,258		)
Other	(16,389		)	(15,217		)
Total accumulated amortization	(168,340		)	(157,081		)
Other intangible assets, net	$	288,837		$	306,004

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Restructuring and Other Charges, Net (Tables)

6 Months Ended

Jun. 30, 2016

Restructuring and Related Activities [Abstract]

Changes in Employee-Related Restructuring Liabilities

Changes in employee-related restructuring liabilities during the six months ended June 30, 2016, were as follows:

(DOLLARS IN THOUSANDS)	Employee-Related Costs			Accelerated Depreciation			Total
Balance at December 31, 2015	$	7,882		$	—		$	7,882
Additional charges (reversals), net	—			283			283
Non-cash charges	—			(283		)	(283		)
Payments and other costs	(1,446		)	—			(1,446		)
Balance at June 30, 2016	$	6,436		$	—		$	6,436

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Borrowings (Tables)

6 Months Ended

Jun. 30, 2016

Debt Disclosure [Abstract]

Components of Debt

Debt consists of the following:

(DOLLARS IN THOUSANDS)	Rate		Maturities	June 30, 2016			December 31, 2015
Senior notes - 2006 (1)	6.14	%	2016	$	124,991		$	124,964
Senior notes - 2007 (1)	6.40	%	2017-27	499,618			499,618
Senior notes - 2013 (1)	3.20	%	2023	297,846			297,683
Euro Senior notes - 2016 (1)	1.75	%	2024	550,598			—
Credit facility	2.67	%	2019	—			131,196
Bank overdrafts and other				15,791			10,982
Deferred realized gains on interest rate swaps				2,313			3,279
				1,491,157			1,067,722
Less: Current portion of long-term debt				(133,473		)	(132,349		)
				$	1,357,684		$	935,373

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Stock Compensation Plans (Tables)

6 Months Ended

Jun. 30, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation Expense and Related Tax Benefits

Stock-based compensation expense and related tax benefits were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Equity-based awards	$	7,844		$	7,473		$	13,774		$	12,860
Liability-based awards	1,739			666			2,332			2,573
Total stock-based compensation expense	9,583			8,139			16,106			15,433
Less: tax benefit	(2,816		)	(2,225		)	(4,789		)	(4,412		)
Total stock-based compensation expense, after tax	$	6,767		$	5,914		$	11,317		$	11,021

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Segment Information (Tables)

6 Months Ended

Jun. 30, 2016

Segment Reporting [Abstract]

Reportable Segment Information

Reportable segment information is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Net sales:
Flavors	$	379,504		$	372,478		$	752,012		$	749,586
Fragrances	413,974			395,063			824,777			792,862
Consolidated	$	793,478		$	767,541		$	1,576,789		$	1,542,448
Segment profit:
Flavors	$	90,337		$	84,015		$	182,151		$	176,743
Fragrances	87,596			79,924			176,833			161,522
Global expenses	(12,232		)	(8,629		)	(26,141		)	(20,194		)
Restructuring and other charges, net (1)	(182		)	358			(283		)	170
Acquisition and related costs (2)	(213		)	(6,566		)	(1,249		)	(7,066		)
Operational improvement initiative costs (3)	(831		)	(281		)	(1,099		)	(562		)
Spanish capital tax settlement (4)	—			—			1,482			—
Operating profit	164,475			148,821			331,694			310,613
Interest expense	(15,060		)	(11,407		)	(27,539		)	(22,502		)
Other income (expense)	2,635			(436		)	2,792			5,275
Income before taxes	$	152,050		$	136,978		$	306,947		$	293,386

(1) Restructuring and other charges, net relate to accelerated depreciation costs in Europe recorded in Cost of goods sold.

(2) Acquisition and related costs are associated with the 2015 acquisition of Lucas Meyer as discussed in Note 3, including inventory step-up charges related to the inventory acquired.

(3) Operational improvement initiative costs relate to accelerated depreciation and severance costs in Asia in the 2016 period and accelerated depreciation in the 2015 period.

(4) The Spanish capital tax settlement represents interest received from the Spanish government related to the reversal of the unfavorable ruling the Spanish capital tax case from 2002, which was reversed during the year ended December 31, 2015.

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Employee Benefits (Tables)

6 Months Ended

Jun. 30, 2016

Compensation and Retirement Disclosure [Abstract]

Pension and Other Defined Contribution Retirement Plan Expenses

Pension and other defined contribution retirement plan expenses included the following components:

U.S. Plans	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Service cost for benefits earned	$	772		$	984		$	1,543		$	1,968
Interest cost on projected benefit obligation	6,006			5,954			12,013			11,907
Expected return on plan assets	(8,070		)	(8,083		)	(16,139		)	(16,165		)
Net amortization and deferrals	1,385			5,203			2,772			10,406
Net periodic benefit cost	93			4,058			189			8,116
Defined contribution and other retirement plans	2,211			2,093			4,612			4,228
Total expense	$	2,304		$	6,151		$	4,801		$	12,344
Non-U.S. Plans	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Service cost for benefits earned	$	3,863		$	4,102		$	7,638		$	8,485
Interest cost on projected benefit obligation	6,372			6,151			12,737			12,543
Expected return on plan assets	(11,985		)	(12,440		)	(23,934		)	(25,390		)
Net amortization and deferrals	3,286			3,314			6,550			6,801
Net periodic benefit cost	1,536			1,127			2,991			2,439
Defined contribution and other retirement plans	1,763			1,693			3,470			3,288
Total expense	$	3,299		$	2,820		$	6,461		$	5,727

Postretirement Benefits Other Than Pension Expenses

Expense recognized for postretirement benefits other than pensions included the following components:

	Three Months Ended June 30,						Six Months Ended June 30,
(DOLLARS IN THOUSANDS)	2016			2015			2016			2015
Service cost for benefits earned	$	214		$	301		$	429		$	601
Interest cost on projected benefit obligation	787			1,082			1,574			2,164
Net amortization and deferrals	(1,355		)	(712		)	(2,710		)	(1,423		)
Total postretirement benefit (income) expense	$	(354	)	$	671		$	(707	)	$	1,342

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Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2016

Investments, All Other Investments [Abstract]

Carrying Amount and Estimated Fair Values of Financial Instruments

The amounts recorded in the balance sheet (carrying amount) and the estimated fair values of financial instruments at June 30, 2016 and December 31, 2015 consisted of the following:

	June 30, 2016				December 31, 2015
(DOLLARS IN THOUSANDS)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Cash and cash equivalents (1)	$	539,992	$	539,992	$	181,988	$	181,988
Credit facilities and bank overdrafts (2)	15,791		15,791		142,178		142,178
Long-term debt: (3)
Senior notes - 2006	124,991		125,225		124,964		127,717
Senior notes - 2007	499,618		578,590		499,618		563,855
Senior notes - 2013	297,846		312,847		297,683		290,830
Euro Senior notes - 2016	550,598		584,953		—		—

(1) The carrying amount of cash and cash equivalents approximates fair value due to the short maturity of those instruments.

(2) The carrying amount of our credit facilities and bank overdrafts approximates fair value as the interest rate is reset frequently based on current market rates as well as the short maturity of those instruments.

(3) The fair value of our long-term debt was calculated using discounted cash flows applying current interest rates and current credit spreads based on our own credit risk.

Derivative Instruments Notional Amount Outstanding

The following table shows the notional amount of the Company’s derivative instruments outstanding as of June 30, 2016 and December 31, 2015:

(DOLLARS IN THOUSANDS)	June 30, 2016		December 31, 2015
Foreign currency contracts	$	805,900	$	573,200
Interest rate swaps	$	475,000	$	475,000

Derivative Instruments Measured at Fair Value

The following tables show the Company’s derivative instruments measured at fair value (Level 2 of the fair value hierarchy), as reflected in the Consolidated Balance Sheets as of June 30, 2016 and December 31, 2015:

	June 30, 2016
(DOLLARS IN THOUSANDS)	Fair Value of Derivatives Designated as Hedging Instruments		Fair Value of Derivatives Not Designated as Hedging Instruments		Total Fair Value
Derivative assets (a)
Foreign currency contracts	$	4,038	$	12,159	$	16,197
Interest rate swaps	4,341		—		4,341
	$	8,379	$	12,159	$	20,538
Derivative liabilities (b)
Foreign currency contracts	$	1,353	$	9,274	$	10,627
	$	1,353	$	9,274	$	10,627

	December 31, 2015
(DOLLARS IN THOUSANDS)	Fair Value of Derivatives Designated as Hedging Instruments		Fair Value of Derivatives Not Designated as Hedging Instruments		Total Fair Value
Derivative assets (a)
Foreign currency contracts	$	6,560	$	3,700	$	10,260
Interest rate swaps	1,210		—		1,210
	$	7,770	$	3,700	$	11,470
Derivative liabilities (b)
Foreign currency contracts	$	2,106	$	3,022	$	5,128

(a) Derivative assets are recorded to Prepaid expenses and other current assets in the Consolidated Balance Sheet.

(b) Derivative liabilities are recorded as Other current liabilities in the Consolidated Balance Sheet.

Derivative Instruments Which Were Not Designated as Hedging Instruments

The following table shows the effect of the Company’s derivative instruments which were not designated as hedging instruments in the Consolidated Statement of Comprehensive Income for the three and six months ended June 30, 2016 and 2015 (in thousands):

Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income on Derivative					Location of Gain (Loss) Recognized in Income on Derivative
	Three Months Ended June 30,
	2016			2015
Foreign currency contracts	$	1,395		$	371	Other (income) expense, net
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income on Derivative					Location of Gain (Loss) Recognized in Income on Derivative
	Six Months Ended June 30,
	2016			2015
Foreign currency contracts	$	(3,548	)	$	10,075	Other (income) expense, net

Derivative Instruments Designated as Cash Flow and Net Investment Hedging Instruments

The following table shows the effect of the Company’s derivative instruments designated as cash flow and net investment hedging instruments in the Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2016 and 2015 (in thousands):

	Amount of (Loss) Gain Recognized in OCI on Derivative (Effective Portion)						Location of (Loss) Gain Reclassified from AOCI into Income (Effective Portion)	Amount of (Loss) Gain Reclassified from Accumulated OCI into Income (Effective Portion)
	Three Months Ended June 30,							Three Months Ended June 30,
	2016			2015				2016			2015
Derivatives in Cash Flow Hedging Relationships:
Foreign currency contracts	$	612		$	(6,035	)	Cost of goods sold	$	2,736		$	3,561
Interest rate swaps (1)	171			69			Interest expense	(171		)	(69		)
Derivatives in Net Investment Hedging Relationships:
Foreign currency contracts	1,934			(1,030		)	N/A	—			—
Euro Senior notes - 2016	9,649			—			N/A	—			—
Total	$	12,366		$	(6,996	)		$	2,565		$	3,492
	Amount of (Loss) Gain Recognized in OCI on Derivative (Effective Portion)						Location of (Loss) Gain Reclassified from AOCI into Income (Effective Portion)	Amount of (Loss) Gain Reclassified from Accumulated OCI into Income (Effective Portion)
	Six Months Ended June 30,							Six Months Ended June 30,
	2016			2015				2016			2015
Derivatives in Cash Flow Hedging Relationships:
Foreign currency contracts	$	(6,391	)	$	5,979		Cost of goods sold	$	5,352		$	4,584
Interest rate swaps (1)	(3,001		)	138			Interest expense	(257		)	(138		)
Derivatives in Net Investment Hedging Relationships:
Foreign currency contracts	(470		)	3,531			N/A	—			—
Euro Senior notes - 2016	9,649			—			N/A	—			—
Total	$	(213	)	$	9,648			$	5,095		$	4,446

(1) Interest rate swaps were entered into as pre-issuance hedges.

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Accumulated Other Comprehensive Income (Loss) (Tables)

6 Months Ended

Jun. 30, 2016

Equity [Abstract]

Schedule of Changes in Accumulated Other Comprehensive Income (Loss)

The following tables present changes in the accumulated balances for each component of other comprehensive income, including current period other comprehensive income and reclassifications out of accumulated other comprehensive income:

	Foreign Currency Translation Adjustments			(Losses) Gains on Derivatives Qualifying as Hedges			Pension and Postretirement Liability Adjustment			Total
(DOLLARS IN THOUSANDS)
Accumulated other comprehensive (loss) income, net of tax, as of December 31, 2015	$	(297,499	)	$	9,401		$	(325,342	)	$	(613,440	)
OCI before reclassifications	9,389			(4,297		)	—			5,092
Amounts reclassified from AOCI	—			(5,095		)	5,133			38
Net current period other comprehensive income (loss)	9,389			(9,392		)	5,133			5,130
Accumulated other comprehensive (loss) income, net of tax, as of June 30, 2016	$	(288,110	)	$	9		$	(320,209	)	$	(608,310	)

	Foreign Currency Translation Adjustments			(Losses) Gains on Derivatives Qualifying as Hedges			Pension and Postretirement Liability Adjustment			Total
(DOLLARS IN THOUSANDS)
Accumulated other comprehensive (loss) income, net of tax, as of December 31, 2014	$	(173,342	)	$	12,371		$	(379,459	)	$	(540,430	)
OCI before reclassifications	(32,958		)	10,563			—			(22,395		)
Amounts reclassified from AOCI	—			(4,446		)	11,023			6,577
Net current period other comprehensive income (loss)	(32,958		)	6,117			11,023			(15,818		)
Accumulated other comprehensive (loss) income, net of tax, as of June 30, 2015	$	(206,300	)	$	18,488		$	(368,436	)	$	(556,248	)

Reclassifications of Accumulated Other Comprehensive Income to Consolidated Statement of Comprehensive Income

The following table provides details about reclassifications out of accumulated other comprehensive income to the Consolidated Statement of Comprehensive Income:

	Six Months Ended June 30, 2016			Six Months Ended June 30, 2015			Affected Line Item in the Consolidated Statement of Comprehensive  Income
(DOLLARS IN THOUSANDS)
(Losses) gains on derivatives qualifying as hedges
Foreign currency contracts	$	6,117		$	5,239		Cost of goods sold
Interest rate swaps	(257		)	(138		)	Interest expense
	(765		)	(655		)	Provision for income taxes
	$	5,095		$	4,446		Total, net of income taxes
(Losses) gains on pension and postretirement liability adjustments
Prior service cost	$	3,735		$	2,318		(a)
Actuarial losses	(10,347		)	(18,102		)	(a)
	1,479			4,761			Provision for income taxes
	$	(5,133	)	$	(11,023	)	Total, net of income taxes

(a) The amortization of prior service cost and actuarial loss is included in the computation of net periodic benefit cost. Refer to Note 14 of our 2015 Form 10-K for additional information regarding net periodic benefit cost.

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Consolidated Financial Statements Consolidated Financial Statements (Details) - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2016	Dec. 31, 2015
New Accounting Pronouncement, Early Adoption [Line Items]
Total Inventories	$ 584,489			$ 572,047
Accounts payable	255,143			285,501
Net cash provided by operating activities	154,550	$ 166,318
Net cash provided by (used in) financing activities	253,125	(46,967)
Proceeds from sale of finance receivables	$ 17,700	$ 1,300
Restatement Adjustment [Member] | Revision to Properly Reflect Inventory in Transit [Member]
New Accounting Pronouncement, Early Adoption [Line Items]
Total Inventories				(17,000)
Accounts payable				$ (17,000)
Scenario, Forecast [Member] | Accounting Standards Update 2016-09, Statutory Tax Withholding Component [Member] | New Accounting Pronouncement, Early Adoption, Effect [Member] | Minimum [Member]
New Accounting Pronouncement, Early Adoption [Line Items]
Net cash provided by operating activities			$ 20,000
Net cash provided by (used in) financing activities			(20,000)
Scenario, Forecast [Member] | Accounting Standards Update 2016-09, Statutory Tax Withholding Component [Member] | New Accounting Pronouncement, Early Adoption, Effect [Member] | Maximum [Member]
New Accounting Pronouncement, Early Adoption [Line Items]
Net cash provided by operating activities			25,000
Net cash provided by (used in) financing activities			$ (25,000)

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Net Income Per Share - Reconciliation of Shares Used in Computation of Basic and Diluted Net Income Per Share (Detail) - shares shares in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Earnings Per Share [Abstract]
Basic (shares)	79,764	80,790	79,809	80,729
Assumed dilution under stock plans (shares)	276	402	332	472
Diluted (shares)	80,040	81,192	80,141	81,201

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Net Income Per Share - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Net income allocated to PRS	$ 0.3	$ 0.5	$ 0.5	$ 1.1
Maximum [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Difference amount between basic and diluted net income per share			$ 0.01	$ 0.01
Employee Stock Option [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Stock excluded from computation of diluted net income per share		0		0
Stock-Settled Appreciation Rights (SARs) [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Stock excluded from computation of diluted net income per share	0	0	0	0

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Acquisitions (Details) $ in Thousands, € in Millions	3 Months Ended			6 Months Ended
	Sep. 30, 2015 EUR (€)	Sep. 30, 2015 USD ($)	Jun. 30, 2015 USD ($)	Jun. 30, 2016 USD ($)	Jun. 30, 2015 USD ($)	Dec. 31, 2015 USD ($)
Business Acquisition [Line Items]
Cash paid for acquisition, net of cash received				$ 0	$ 188,835
Goodwill				$ 940,544		$ 941,389
Lucas Meyer [Member]
Business Acquisition [Line Items]
Percentage of interests acquired		100.00%
Total consideration for acquisition	€ 284.0	$ 312,100
Cash Acquired from Acquisition		4,800
Cash paid for acquisition, net of cash received	282.1	309,900
Liability recorded for acquisition consideration	€ 2.0	2,200
Purchase price over carrying value of net assets		290,100
Intangible assets acquired		156,400
Goodwill		179,500
Deferred tax liabilities		$ 38,100
Lucas Meyer [Member] | Trade Names and Proprietary Technology [Member]
Business Acquisition [Line Items]
Acquired intangible assets useful life	28 years	28 years
Lucas Meyer [Member] | Customer relationships
Business Acquisition [Line Items]
Acquired intangible assets useful life	23 years	23 years
Lucas Meyer [Member] | Patents [Member]
Business Acquisition [Line Items]
Acquired intangible assets useful life	11 years	11 years
Lucas Meyer [Member] | Non-solicitation Agreements [Member]
Business Acquisition [Line Items]
Acquired intangible assets useful life	3 years	3 years
Henry H Ottens Manufacturing Co [Member]
Business Acquisition [Line Items]
Percentage of interests acquired			100.00%		100.00%
Cash Acquired from Acquisition			$ 10,400
Cash paid for acquisition, net of cash received			$ 198,900

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Goodwill and Other Intangible Assets, Net - Schedule of Movements in Goodwill (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2016 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
Balance at December 31, 2015	$ 941,389
Foreign exchange	3,229
Other	(4,074)
Balance at June 30, 2016	$ 940,544

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Restructuring and Other Charges, Net - Additional Information (Detail) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2016 USD ($)	Dec. 31, 2015 USD ($) Position	Jun. 30, 2015 USD ($)	Jun. 30, 2016 USD ($)	Jun. 30, 2015 USD ($)
Restructuring Cost and Reserve [Line Items]
Restructuring charge	$ 0		$ (358)	$ 0	$ (170)
Fragrance Ingredients Rationalization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charge				283
Payments for Restructuring and Other Costs				1,446
Expected restructuring costs	11,000			11,000
Accelerated Depreciation [Member] | Fragrance Ingredients Rationalization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charge				283
Payments for Restructuring and Other Costs				0
Restructuring, accelerated depreciation of fixed assets	$ 300
Employee Severance [Member] | 2015 Severance Initiatives [Member]
Restructuring Cost and Reserve [Line Items]
Number of positions expected to be eliminated | Position		150
Employee -Related Costs [Member] | Fragrance Ingredients Rationalization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charge				0
Payments for Restructuring and Other Costs				$ 1,446
Other Expense [Member] | Employee Severance [Member] | 2015 Severance Initiatives [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charge		$ 7,600

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Goodwill and Other Intangible Assets, Net - Schedule of Other Intangible Assets, Net (Detail) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Finite-Lived Intangible Assets [Line Items]
Total carrying value	$ 457,177	$ 463,085
Total accumulated amortization	(168,340)	(157,081)
Other intangible assets, net	288,837	306,004
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Total carrying value	289,743	293,799
Total accumulated amortization	(74,061)	(66,324)
Trade names & patents
Finite-Lived Intangible Assets [Line Items]
Total carrying value	31,554	34,182
Total accumulated amortization	(11,272)	(10,282)
Technological know-how
Finite-Lived Intangible Assets [Line Items]
Total carrying value	111,808	112,393
Total accumulated amortization	(66,618)	(65,258)
Other
Finite-Lived Intangible Assets [Line Items]
Total carrying value	24,072	22,711
Total accumulated amortization	$ (16,389)	$ (15,217)

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Restructuring and Other Charges, Net - Changes in Employee-Related Restructuring Liabilities (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Restructuring Reserve [Roll Forward]
Additional charges (reversals), net	$ 0	$ (358)	$ 0	$ (170)
Fragrance Ingredients Rationalization [Member]
Restructuring Reserve [Roll Forward]
Beginning Balance			7,882
Additional charges (reversals), net			283
Non-cash charges			(283)
Payments and other costs			(1,446)
Ending Balance	6,436		6,436
Fragrance Ingredients Rationalization [Member] | Employee -Related Costs [Member]
Restructuring Reserve [Roll Forward]
Beginning Balance			7,882
Additional charges (reversals), net			0
Non-cash charges			0
Payments and other costs			(1,446)
Ending Balance	6,436		6,436
Fragrance Ingredients Rationalization [Member] | Accelerated Depreciation [Member]
Restructuring Reserve [Roll Forward]
Beginning Balance			0
Additional charges (reversals), net			283
Non-cash charges			(283)
Payments and other costs			0
Ending Balance	$ 0		$ 0

XML

Goodwill and Other Intangible Assets, Net - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization of acquisition-related intangibles	$ 5,130	$ 3,040	$ 11,191	$ 4,880
Estimated annual amortization, 2016	21,800		21,800
Estimated annual amortization, 2017	21,400		21,400
Estimated annual amortization, 2018	21,200		21,200
Estimated annual amortization, 2019	20,000		20,000
Estimated annual amortization, 2020	19,300		19,300
Estimated annual amortization, 2021	$ 15,100		$ 15,100

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Borrowings - Components of Debt (Detail) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Mar. 14, 2016	Dec. 31, 2015
Debt Instrument [Line Items]
Total debt	$ 1,491,157		$ 1,067,722
Less: Current portion of long-term debt	(133,473)		(132,349)
Total long-term debt	$ 1,357,684		935,373
Senior Notes 2006 [Member]
Debt Instrument [Line Items]
Rate	6.14%
Maturities	2016
Credit facilities	$ 124,991		124,964
Senior Notes 2007 [Member]
Debt Instrument [Line Items]
Rate	6.40%
Maturities	2017-27
Credit facilities	$ 499,618		499,618
Senior Notes 2007 [Member] | Minimum [Member]
Debt Instrument [Line Items]
Maturities	2017
Senior Notes 2007 [Member] | Maximum [Member]
Debt Instrument [Line Items]
Maturities	2027
Senior Notes 2013 [Member]
Debt Instrument [Line Items]
Rate	3.20%
Maturities	2023
Credit facilities	$ 297,846		297,683
Senior Notes 2016 [Member]
Debt Instrument [Line Items]
Rate	1.75%	1.75%
Maturities	2024
Credit facilities	$ 550,598		0
Revolver Borrowings [Member]
Debt Instrument [Line Items]
Rate	2.67%
Maturities	2019
Credit facilities	$ 0		131,196
Bank overdrafts and other [Member]
Debt Instrument [Line Items]
Bank overdrafts and other	15,791		10,982
Deferred realized gains on interest rate swaps [Member]
Debt Instrument [Line Items]
Deferred realized gains on interest rate swaps	$ 2,313		$ 3,279

XML

Borrowings Narrative (Details)			3 Months Ended
	Jul. 12, 2016 USD ($)	Mar. 14, 2016 EUR (€)	Jun. 30, 2016 USD ($)	Mar. 14, 2016 USD ($)
Debt Instrument [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity | $			$ 950,000,000.0
Loss upon settlement of hedges | $			$ 3,200,000
Senior Notes 2016 [Member]
Debt Instrument [Line Items]
Debt face amount | €		€ 500,000,000.00
Debt instrument stated rate (percent)		1.75%	1.75%	1.75%
Debt discount | €		€ 900,000
Proceeds from debt issuance | €		496,000,000
Debt underwriting discount | €		€ 3,100,000
Other deferred financing costs | $				$ 1,300,000
Debt instrument, term		8 years
Notice period for redemption		30 days
Repurchase price of the principal amount outstanding (percent)		101.00%
Senior Notes 2006 [Member]
Debt Instrument [Line Items]
Debt instrument stated rate (percent)			6.14%
Senior Notes 2006 [Member] | Subsequent Event [Member]
Debt Instrument [Line Items]
Repayment of debt | $	$ 125,000,000

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Income Taxes - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Income Taxes [Line Items]
Tax settlement	$ 10.5
Spanish tax settlement [Member]
Income Taxes [Line Items]
Effective tax rate	23.20%	23.10%	23.30%	20.40%
Foreign Tax Authority [Member]
Income Taxes [Line Items]
Provision for uncertain tax positions	$ 26.0		$ 26.0
2007-2012 [Member] | Minimum [Member]
Income Taxes [Line Items]
Income tax examination, years under examination			2006
2007-2012 [Member] | Maximum [Member]
Income Taxes [Line Items]
Income tax examination, years under examination			2015
Other Liabilities [Member]
Income Taxes [Line Items]
Unrecognized tax benefits that would impact effective tax rate	25.1		$ 25.1
Accrued interest and penalties	$ 0.9		$ 0.9

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Stock Compensation Plans - Stock-Based Compensation Expense and Related Tax Benefits (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total stock-based compensation expense	$ 9,583	$ 8,139	$ 16,106	$ 15,433
Less: tax benefit	(2,816)	(2,225)	(4,789)	(4,412)
Total stock-based compensation expense, after tax	6,767	5,914	11,317	11,021
Equity-based awards [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total stock-based compensation expense	7,844	7,473	13,774	12,860
Liability-based awards [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total stock-based compensation expense	$ 1,739	$ 666	$ 2,332	$ 2,573

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Segment Information - Additional Information (Detail) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016 USD ($)	Jun. 30, 2015 USD ($)	Jun. 30, 2016 USD ($) segment	Jun. 30, 2015 USD ($)
Revenues from External Customers and Long-Lived Assets [Line Items]
Number of segments | segment			2
US
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	$ 185.0	$ 174.0	$ 365.0	$ 338.0
Foreign Countries
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	$ 608.0	$ 594.0	$ 1,212.0	$ 1,204.0
Sales [Member] | Foreign Countries
Revenues from External Customers and Long-Lived Assets [Line Items]
Maximum percentage of total consolidated net sales attributed to any non-U.S. country			10.00%

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Segment Information - Reportable Segment Information (Detail) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Net sales:
Net sales		$ 793,478	$ 767,541	$ 1,576,789	$ 1,542,448
Segment profit:
Operating profit		164,475	148,821	331,694	310,613
Interest expense		(15,060)	(11,407)	(27,539)	(22,502)
Other income, net		2,635	(436)	2,792	5,275
Income before taxes		152,050	136,978	306,947	293,386
Flavors [Member]
Net sales:
Net sales		379,504	372,478	752,012	749,586
Segment profit:
Operating profit		90,337	84,015	182,151	176,743
Fragrances [Member]
Net sales:
Net sales		413,974	395,063	824,777	792,862
Segment profit:
Operating profit		87,596	79,924	176,833	161,522
Global expenses [Member]
Segment profit:
Operating profit		(12,232)	(8,629)	(26,141)	(20,194)
Restructuring and other charges, net
Segment profit:
Operating profit	[1]	(182)	358	(283)	170
Acquisition and related costs
Segment profit:
Operating profit	[2]	(213)	(6,566)	(1,249)	(7,066)
Operational improvement initiative costs
Segment profit:
Operating profit	[3]	(831)	(281)	(1,099)	(562)
Spanish capital tax settlement
Segment profit:
Operating profit	[4]	$ 0	$ 0	$ 1,482	$ 0

[1] Restructuring and other charges, net relate to accelerated depreciation costs in Europe recorded in Cost of goods sold.

[2] Acquisition and related costs are associated with the 2015 acquisition of Lucas Meyer as discussed in Note 3, including inventory step-up charges related to the inventory acquired

[3] Operational improvement initiative costs relate to accelerated depreciation and severance costs in Asia in the 2016 period and accelerated depreciation in the 2015 period.

[4] The Spanish capital tax settlement represents interest received from the Spanish government related to the reversal of the unfavorable ruling the Spanish capital tax case from 2002, which was reversed during the year ended December 31, 2015.

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Employee Benefits - Pension and Other Defined Contribution Retirement Plan Expenses (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
U.S. Pension Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost for benefits earned	$ 772	$ 984	$ 1,543	$ 1,968
Interest cost on projected benefit obligation	6,006	5,954	12,013	11,907
Expected return on plan assets	(8,070)	(8,083)	(16,139)	(16,165)
Net amortization and deferrals	1,385	5,203	2,772	10,406
Total postretirement benefit (income) expense	93	4,058	189	8,116
Total expense	2,304	6,151	4,801	12,344
Non-U.S. Pension Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost for benefits earned	3,863	4,102	7,638	8,485
Interest cost on projected benefit obligation	6,372	6,151	12,737	12,543
Expected return on plan assets	(11,985)	(12,440)	(23,934)	(25,390)
Net amortization and deferrals	3,286	3,314	6,550	6,801
Total postretirement benefit (income) expense	1,536	1,127	2,991	2,439
Total expense	3,299	2,820	6,461	5,727
United States Postretirement Benefit Plan of US Entity [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined contribution and other retirement plans	2,211	2,093	4,612	4,228
Non-U.S. Pension Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined contribution and other retirement plans	$ 1,763	$ 1,693	$ 3,470	$ 3,288

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Employee Benefits - Additional Information (Detail) $ in Millions	6 Months Ended
	Jun. 30, 2016 USD ($)
Non-Qualified U.S. Pension Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Contribution to the plans	$ 2.2
Non-U.S. Pension Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Contribution to the plans	17.3
U.S. Pension Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Contribution to the plans	20.0
Postretirement Benefit Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Expected contribution to the plan	5.0
Contribution to other postretirement plans	2.6
Maximum [Member] | Non-U.S. Pension Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Expected contribution to the plan	$ 30.0

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Employee Benefits - Postretirement Benefits Other Than Pension Expenses (Detail) - Postretirement Benefit Plan [Member] - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Defined Benefit Plan Disclosure [Line Items]
Service cost for benefits earned	$ 214	$ 301	$ 429	$ 601
Interest cost on projected benefit obligation	787	1,082	1,574	2,164
Net amortization and deferrals	(1,355)	(712)	(2,710)	(1,423)
Total postretirement benefit (income) expense	$ (354)	$ 671	$ (707)	$ 1,342

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Financial Instruments - Carrying Amount and Estimated Fair Values of Financial Instruments (Detail) - USD ($) $ in Thousands		Jun. 30, 2016	Dec. 31, 2015
Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents, at fair value	[1]	$ 539,992	$ 181,988
Credit facilities and bank overdrafts	[2]	15,791	142,178
Reported Value Measurement [Member] | Senior Notes 2006 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Senior Notes, Noncurrent	[3]	124,991	124,964
Reported Value Measurement [Member] | Senior Notes 2007 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Senior Notes, Noncurrent	[3]	499,618	499,618
Reported Value Measurement [Member] | Senior Notes 2013 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Senior Notes, Noncurrent	[3]	297,846	297,683
Reported Value Measurement [Member] | Senior Notes 2016 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Senior Notes, Noncurrent	[3]	550,598	0
Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents, at fair value	[1]	539,992	181,988
Credit facilities and bank overdrafts	[2]	15,791	142,178
Estimate of Fair Value Measurement [Member] | Senior Notes 2006 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Senior Notes, Noncurrent	[3]	125,225	127,717
Estimate of Fair Value Measurement [Member] | Senior Notes 2007 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Senior Notes, Noncurrent	[3]	578,590	563,855
Estimate of Fair Value Measurement [Member] | Senior Notes 2013 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Senior Notes, Noncurrent	[3]	312,847	290,830
Estimate of Fair Value Measurement [Member] | Senior Notes 2016 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Senior Notes, Noncurrent	[3]	$ 584,953	$ 0

[1] The carrying amount of cash and cash equivalents approximates fair value due to the short maturity of those instruments.

[2] The carrying amount of our credit facilities and bank overdrafts approximates fair value as the interest rate is reset frequently based on current market rates as well as the short maturity of those instruments.

[3] The fair value of our long-term debt was calculated using discounted cash flows applying current interest rates and current credit spreads based on our own credit risk.

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Financial Instruments - Additional Information (Detail) € in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016 EUR (€) contract	Jun. 30, 2016 USD ($) contract	Jun. 30, 2016 USD ($) contract	Mar. 31, 2016 swap
Derivative [Line Items]
Derivative losses included in AOCI		$ 1,700,000
Net investment hedge ineffectiveness		0	$ 0
Cash flow hedge ineffectiveness		0	$ 0
Foreign Exchange Forward [Member]
Derivative [Line Items]
Term of derivative			12 months
Interest rate swaps [Member] | Swap [Member]
Derivative [Line Items]
Number of derivatives (swap) | swap				2
Number of instruments terminated (swap) | swap				2
Loss on settlement of derivatives	€ (2.9)	$ 3,200,000
Net Investment Hedging [Member] | Designated as Hedging Instrument [Member] | Foreign Exchange Forward [Member]
Derivative [Line Items]
Remaining maturity term			1 year
Number of derivatives matured (contract) | contract	8	8	8

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Financial Instruments - Derivative Instruments Notional Amount Outstanding (Detail) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Foreign currency contracts [Member]
Schedule Of Information By Major Category Of Credit Derivatives Contracts [Line Items]
Derivative instruments outstanding	$ 805,900	$ 573,200
Interest rate swaps [Member]
Schedule Of Information By Major Category Of Credit Derivatives Contracts [Line Items]
Derivative instruments outstanding	$ 475,000	$ 475,000

XML

Financial Instruments - Derivative Instruments Measured at Fair Value (Detail) - USD ($) $ in Thousands		Jun. 30, 2016	Dec. 31, 2015
Derivatives, Fair Value [Line Items]
Total Fair Value, Derivative Assets	[1]	$ 20,538	$ 11,470
Total Fair Value, Derivative Liabilities	[2]	10,627
Foreign currency contracts [Member]
Derivatives, Fair Value [Line Items]
Total Fair Value, Derivative Assets	[1]	16,197	10,260
Total Fair Value, Derivative Liabilities	[2]	10,627	5,128
Interest rate swaps [Member]
Derivatives, Fair Value [Line Items]
Total Fair Value, Derivative Assets	[1]	4,341	1,210
Fair Value of Derivatives Designated as Hedging Instruments [Member]
Derivatives, Fair Value [Line Items]
Total Fair Value, Derivative Assets	[1]	8,379	7,770
Total Fair Value, Derivative Liabilities	[2]	1,353
Fair Value of Derivatives Designated as Hedging Instruments [Member] | Foreign currency contracts [Member]
Derivatives, Fair Value [Line Items]
Total Fair Value, Derivative Assets	[1]	4,038	6,560
Total Fair Value, Derivative Liabilities	[2]	1,353	2,106
Fair Value of Derivatives Designated as Hedging Instruments [Member] | Interest rate swaps [Member]
Derivatives, Fair Value [Line Items]
Total Fair Value, Derivative Assets	[1]	4,341	1,210
Fair Value of Derivatives Not Designated as Hedging Instruments [Member]
Derivatives, Fair Value [Line Items]
Total Fair Value, Derivative Assets	[1]	12,159	3,700
Total Fair Value, Derivative Liabilities	[2]	9,274
Fair Value of Derivatives Not Designated as Hedging Instruments [Member] | Foreign currency contracts [Member]
Derivatives, Fair Value [Line Items]
Total Fair Value, Derivative Assets	[1]	12,159	3,700
Total Fair Value, Derivative Liabilities	[2]	9,274	3,022
Fair Value of Derivatives Not Designated as Hedging Instruments [Member] | Interest rate swaps [Member]
Derivatives, Fair Value [Line Items]
Total Fair Value, Derivative Assets	[1]	$ 0	$ 0

[1] Derivative assets are recorded to Prepaid expenses and other current assets in the Consolidated Balance Sheet.

[2] Derivative liabilities are recorded as Other current liabilities in the Consolidated Balance Sheet.

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Financial Instruments - Derivative Instruments Which Were Not Designated as Hedging Instruments (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Not Designated as Hedging Instrument [Member] | Foreign currency contracts [Member] | Other income (expense), net [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of (Loss) Gain Recognized in Income on Derivative	$ 1,395	$ 371	$ (3,548)	$ 10,075

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Financial Instruments - Derivative Instruments Designated as Cash Flow and Net Investment Hedging Instruments (Detail) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Derivative Instruments, Gain (Loss) [Line Items]
Amount of (Loss) Gain Recognized in OCI on Derivative (Effective Portion)		$ 12,366	$ (6,996)	$ (213)	$ 9,648
Amount of (Loss) Gain Reclassified from Accumulated OCI into Income (Effective Portion)		2,565	3,492	5,095	4,446
Foreign currency contracts [Member] | Derivatives in Cash Flow Hedging Relationships [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of (Loss) Gain Recognized in OCI on Derivative (Effective Portion)		612	(6,035)	(6,391)	5,979
Foreign currency contracts [Member] | Derivatives in Net Investment Hedging Relationships [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of (Loss) Gain Recognized in OCI on Derivative (Effective Portion)		1,934	(1,030)	(470)	3,531
Foreign currency contracts [Member] | Cost of goods sold [Member] | Derivatives in Cash Flow Hedging Relationships [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of (Loss) Gain Reclassified from Accumulated OCI into Income (Effective Portion)		2,736	3,561	5,352	4,584
Interest rate swaps [Member] | Derivatives in Cash Flow Hedging Relationships [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of (Loss) Gain Recognized in OCI on Derivative (Effective Portion)	[1]	171	69	(3,001)	138
Interest rate swaps [Member] | Interest expense [Member] | Derivatives in Cash Flow Hedging Relationships [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of (Loss) Gain Reclassified from Accumulated OCI into Income (Effective Portion)	[1]	(171)	(69)	(257)	(138)
Senior Notes 2016 [Member] | Derivatives in Net Investment Hedging Relationships [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of (Loss) Gain Recognized in OCI on Derivative (Effective Portion)		$ 9,649	$ 0	$ 9,649	$ 0

[1] Interest rate swaps were entered into as pre-issuance hedges.

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Accumulated Other Comprehensive Income (Loss) - Schedule of Changes in Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Accumulated other comprehensive loss (income), net of tax, beginning balance			$ (613,440)	$ (540,430)
OCI before reclassifications			5,092	(22,395)
Amounts reclassified from AOCI			38	6,577
Net current period other comprehensive income (loss)	$ (1,311)	$ 17,067	5,130	(15,818)
Accumulated other comprehensive loss (income), net of tax, ending balance	(608,310)	(556,248)	(608,310)	(556,248)
Accumulated Translation Adjustment [Member]
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Accumulated other comprehensive loss (income), net of tax, beginning balance			(297,499)	(173,342)
OCI before reclassifications			9,389	(32,958)
Amounts reclassified from AOCI			0	0
Net current period other comprehensive income (loss)			9,389	(32,958)
Accumulated other comprehensive loss (income), net of tax, ending balance	(288,110)	(206,300)	(288,110)	(206,300)
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member]
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Accumulated other comprehensive loss (income), net of tax, beginning balance			9,401	12,371
OCI before reclassifications			(4,297)	10,563
Amounts reclassified from AOCI			(5,095)	(4,446)
Net current period other comprehensive income (loss)			(9,392)	6,117
Accumulated other comprehensive loss (income), net of tax, ending balance	9	18,488	9	18,488
Accumulated Defined Benefit Plans Adjustment [Member]
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Accumulated other comprehensive loss (income), net of tax, beginning balance			(325,342)	(379,459)
OCI before reclassifications			0	0
Amounts reclassified from AOCI			5,133	11,023
Net current period other comprehensive income (loss)			5,133	11,023
Accumulated other comprehensive loss (income), net of tax, ending balance	$ (320,209)	$ (368,436)	$ (320,209)	$ (368,436)

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Accumulated Other Comprehensive Income (Loss) - Reclassifications of Accumulated Other Comprehensive Income to Consolidated Statement of Comprehensive Income (Detail) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Schedule Of Reclassification Of Accumulated Other Comprehensive Income Loss [Line Items]
(Losses) gains on derivatives qualifying as hedges, net of tax				$ 5,095	$ 4,446
Prior service cost	[1]			3,735	2,318
Actuarial losses	[1]			(10,347)	(18,102)
(Losses) gains on pension and postretirement liability adjustments, net of tax		$ (2,578)	$ (5,476)	(5,133)	(11,023)
Cost of goods sold [Member] | Foreign currency contracts [Member]
Schedule Of Reclassification Of Accumulated Other Comprehensive Income Loss [Line Items]
(Losses) gains on derivatives qualifying as hedges				6,117	5,239
Interest expense [Member] | Interest rate swaps [Member]
Schedule Of Reclassification Of Accumulated Other Comprehensive Income Loss [Line Items]
(Losses) gains on derivatives qualifying as hedges				(257)	(138)
Provision for income taxes [Member]
Schedule Of Reclassification Of Accumulated Other Comprehensive Income Loss [Line Items]
Provision for income taxes for (Losses) gains on derivatives qualifying as hedges				(765)	(655)
Provision for income taxes for gains (Losses) on pension and postretirement liability adjustments				$ 1,479	$ 4,761

[1] The amortization of prior service cost and actuarial loss is included in the computation of net periodic benefit cost. Refer to Note 14 of our 2015 Form 10-K for additional information regarding net periodic benefit cost.

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Commitments and Contingencies - Additional Information (Detail) € in Millions	3 Months Ended			6 Months Ended	12 Months Ended
	Jun. 30, 2016 USD ($)	Mar. 31, 2014 EUR (€)	Mar. 31, 2014 USD ($)	Jun. 30, 2016 USD ($) property	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)	Dec. 31, 2015 EUR (€)	Dec. 31, 2015 USD ($)
Commitments And Contingencies [Line Items]
Bank guarantees related to appeals on income tax and indirect tax cases				$ 16,200,000
Available lines of credit	$ 76,600,000			$ 76,600,000
Duration as potentially responsible party, years				20 years
Number of facilities under potentially responsible party investigation | property				8
Estimation of possible loss	5,000,000			$ 5,000,000
Payments to acquire equipment						$ 6,500,000
Property, Plant and Equipment, Net	737,353,000			737,353,000				$ 732,794,000
Bank guarantees and pledged assets to pursue defenses related to other contingencies				29,600,000
Estimate range of possible loss from other contingencies, minimum	0			0
Estimate range of possible loss from other contingencies, maximum	46,000,000			46,000,000
Payment of Litigation Settlement | €		€ 9.8
Bank guarantees and standby letters of credit [Member]
Commitments And Contingencies [Line Items]
Bank guarantees and letters of credit outstanding				38,000,000
Pledged assets [Member]
Commitments And Contingencies [Line Items]
The amount of pledged assets, principally PP&E to cover income tax and indirect tax assessments				13,400,000
Spanish capital tax settlement
Commitments And Contingencies [Line Items]
Payment of Litigation Settlement			$ 11,200,000
Estimated Litigation Liability							€ (9.8)	$ (10,500,000)
Additional income recorded related to amounts to be received	1,400,000
Zhejiang Ingredients Plant [Member] | CHINA
Commitments And Contingencies [Line Items]
Property, Plant and Equipment, Net	$ 25,000,000			$ 25,000,000
Scenario, Forecast [Member] | Minimum [Member] | Zhejiang Ingredients Plant [Member] | CHINA
Commitments And Contingencies [Line Items]
Restructuring, accelerated depreciation of fixed assets					$ 0
Scenario, Forecast [Member] | Maximum [Member] | Zhejiang Ingredients Plant [Member] | CHINA
Commitments And Contingencies [Line Items]
Restructuring, accelerated depreciation of fixed assets					$ 25,000,000