International Flavors & Fragrances, Inc. · NYSE:IFF
International Flavors & Fragrances — Q3 2021 Earnings Presentation
21 slides from International Flavors & Fragrances's earnings presentation, Nov 9, 2021
Slide 1: Third Quarter 2021 Earnings Conference Call
THIRD QUARTER 2021 EARNINGS CONFERENCE CALL November 9, 2021
Slide 2: Cautionary Statement
CAUTIONARY STATEMENT Statements in this presentation, which are not historical facts or information, are “forward-looking statements” within the meaning of The Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on management’s current assumptions, estimates a
Slide 3: Non-GAAP Financials
NON-GAAP FINANCIALS Use of Non-GAAP Financial Measures We provide in this presentation non-GAAP financial measures, including: (i) combined currency neutral sales; (ii) adjusted operating EBITDA and combined adjusted operating EBITDA; (iii) adjusted operating EBITDA margin and combined adjusted oper
Slide 4: Today's Speakers
TODAY’S SPEAKERS Andreas Fibig Glenn Richter Michael DeVeau Chairman & Executive Vice President, Chief Investor Relations Chief Executive Officer Chief Financial Officer & Communications Officer 4
Slide 5: Agenda
AGENDA 9M YTD 2021 Performance Review ____ Integration Progress ____ Q3 Detailed Financial Review ____ Outlook Ahead ____ Q&A 5
Slide 6: Highlights
9M YTD 2021 HIGHLIGHTS Sales Adjusted Operating Free Cash Flow ² ³ $8.6B EBITDA Margin1 of 22.0% of $884M Combined sales grew +10%; Combined EBITDA grew +5%; ~10% of sales driven by Currency neutral growth of +7%¹ ² Margin pressured by cost inflation¹ ² strong cash generation Net Debt to Credit On-T
Slide 7: Geographic Sales Review
9M YTD 2021 GEOGRAPHIC SALES REVIEW NOAM : +7% ¹ ² Growth achieved in all ASIA: +7% ¹ ² segments ____ Nourish, Scent and Pharma all achieved strong growth Performance led by high-single ____ digit growth in Nourish & Scent Performance led by double-digit growth in India & low single- digit growth in
Slide 8: Category Sales Review
9M YTD 2021 CATEGORY SALES REVIEW Combined Currency Neutral Sales¹ ²: +7% +8% +0% +3% +9% +3% In Millions Flavors Home & Personal Fine Industrial Care Fragrance Ingredients Pharma Cultures & Consumer Food Design Food Enzymes Fragrance $8,625 Grain Processing Ingredients +10% $7,870 Animal Nutrition
Slide 9: Segment Performance
9M YTD 2021 SEGMENT PERFORMANCE ADJUSTED NET O P E R AT I N G SALES¹² SEGMENT EBITDA (Combined currency MARGIN¹² HIGHLIGHTS neutral vs. 9M 20) (Change vs. 9M 20) $4.6 billion 19.9% • Performance led by double-digit growth in Flavors & Ingredients Nourish +9% (20) bps • Strong volume & cost managemen
Slide 10: Strong Sales Growth vs Pre-COVID Levels
9M YTD 2021 STRONG SALES GROWTH VS PRE -COVID LEVELS 9M YTD Sales in $ Millions USD growth vs. 9M YTD 2019 $8,625M / +9% Total $4,638M / +9% Nourish $1,683M / +6% H&B $1,699M / +11% Scent $605M / +8% Pharma 2021 2020 2019 ¹ Combined historical results for the second quarter is defined as 3 months (J
Slide 11: Synergy Realization
9M YTD 2021 SYNERGY REALIZATION P&L Realized Cost Synergies $ millions ~$40M Revenue synergies beginning to contribute top-line performance; Project pipeline strong & growing ____ Strong cost synergy realization, with an incremental $20M in savings delivered in Q3 2021 ____ Expect to achieve at-leas
Slide 12: Consolidated Results
Q3 2021 CONSOLIDATED RESULTS In millions / % of sales 2020 2021 C H AN G E Combined sales +12% driven by double-digit growth in Nourish & strong increases in Scent and H&B; Revenue² $2,737 $3,071 12% FX contributed ~1 ppt ____ Adjusted gross margin¹ ² 37.3% 35.2% (210) bps Gross margin challenged as
Slide 13: Nourish Segment
Q3 2021 NOURISH SEGMENT In millions / % of sales 2020 2021 C H AN G E Currency neutral sales +15%; FX contributed ~2 ppts ____ Revenue² $1,418 $1,662 17% Continued robust growth in Flavors, improving strong double-digits for second consecutive quarter ____ Currency neutral growth¹ ² (3)% – 15% Ingre
Slide 14: Health & Biosciences Segment
Q3 2021 HEALTH & BIOSCIENCES SEGMENT In millions / % of sales 2020 2021 C H AN G E Currency neutral sales +5%; FX contributed ~2 ppts ____ Revenue² $579 $618 7% Double-digit growth in Home & Personal Care & high- single digit increase in Cultures and Food Enzymes ____ Currency neutral growth¹ ² 0% –
Slide 15: Scent Segment
Q3 2021 SCENT SEGMENT In millions / % of sales 2020 2021 C H AN G E Currency neutral sales +9%; FX contributed ~1 ppts ____ Revenue² $525 $580 10% Continued rebound in Fine Fragrances, which grew ~36% led by new wins & improved volumes ____ Currency neutral growth¹ ² 9% – 9% Consumer Fragrances low-
Slide 16: Pharma Solutions Segment
Q3 2021 PHARMA SOLUTIONS SEGMENT In millions / % of sales 2020 2021 C H AN G E Currency neutral sales declined 2%; FX was flat ____ Revenue² $215 $211 (2)% Continued supply challenges related to raw material availability and logistics have impacted the ability to meet strong customer demand Currency
Slide 17: Cash Flow & Leverage
9M YTD 2021 CASH FLOW & LEVERAGE Strong cash flow generation; On-track with deleverage target C AS H F L O W L E V E R AG E Cash and cash equivalents finished at $794 million including $122 million restricted cash Cash flow from operations totaled $1,126 million ____ ____ Gross debt reduced $446 mil
Slide 18: Cost Inflation Trends
FY 2021 COST INFLATION TRENDS Year-over-year cost increases are significant & have accelerated throughout year R AW M AT E R I A L S LOGISTICS ENERGY Q1A Q2A 1 Category Q3A Q1A Q2A 1 Category Q3A Q1A Q2A 1 Category Q3A 18
Slide 19: Combined Consolidated Outlook
FULL YEAR GUIDANCE COMBINED ² CONSOLIDATED OUTLOOK In millions or as % of sales FY 2020² FY 2021² On-track to deliver ~8.5% sales growth driven by currency neutral growth1 of ~6.5% & ~2% contribution from FX ~$11,550 ____ Bullet number one Revenue $10,641 ____ ~8.5% Growth Expect Q4 sales growth to
Slide 20: Summary
SUMMARY Delivering strong year-over-year sales & profit growth ____ Significant progress towards our integration efforts & on-track to deliver previously announced cost & revenue synergies ___ Unprecedented macro supply chain challenges leading to higher inflation; Incremental pricing discussions un
Slide 21: iF f
iF f Where science & creativity meet
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