Sensient Technologies Corporation · NYSE:SXT
Sensient Technologies — Investor Presentation (September 2023)
40 slides from Sensient Technologies's investor presentation, Sep 21, 2023
Slide 1: Sensient Technologies Corporation
Sensient Technologies Corporation
Slide 2: Forward Looking Statements
Forward Looking Statements This document contains statements that may constitute “forward-looking statements” within the meaning of Federal securities laws. Such forward- looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures Within this document, the Company reports certain non-GAAP financial measures, including: (1) revenue, operating income, and diluted earnings per share on an adjusted local currency basis (which eliminate the effects that result from translating its international operatio
Slide 4: Sensient Technologies: Company Overview
Sensient Tech nologies: Lev el 1 Company Confidential Sensient Overview
Slide 5: Leading global manufacturer of colors, flavors, and specialty ingredients
Leading global manufacturer and marketer of colors, flavors, and other specialty ingredients Using advanced technologies and robust global supply chain capabilities to develop specialized solutions Flavors & Extracts 2022 Revenue: $738M Flavors Extracts Taste Technologies Natural Ingredients BioNutr
Slide 6: Global Footprint - A Global Strategic Advantage
Global Footprint - A Global Strategic Advantage 6 Colors Sites Flavors Sites APAC Sites Global Headquarters Milwaukee, WI, USA
Slide 7: 2022 Financial Results
2022 Financial Results Color Group +15.0% +15.1% Flavors & Extracts Group +5.8% +10.3% Asia Pacific Group +14.4% +22.5% Consolidated +9.7% +12.5% Local Currency Adjusted EBITDA* +12.8% Local Currency Adjusted Diluted EPS* +9.9% Local Currency Adjusted Revenue* Local Currency Adjusted Operating Incom
Slide 8: 2023 Q2 YTD Financial Results
2023 Q2 YTD Financial Results Local Currency Revenue* Local Currency Operating Income* Color Group +5.7% (0.7%) Flavors & Extracts Group (1.4%) (19.3%) Asia Pacific Group +6.9% +9.7% Consolidated +2.6% (4.4%) Local Currency Adjusted EBITDA* (4.4%) Local Currency Diluted EPS* (10.0%) *Local-currency
Slide 9: 2023 Industry Trends
2023 Industry Trends New Wins & Product Launches Expect volume declines related to destocking to continue to moderate as the year progresses Energy, growing costs, and certain commodity costs remain elevated; however, the supply chain has become less volatile Adjustments to cover inflation-driven co
Slide 10: Macro Trends to Watch
Macro Trends to Watch 4 Pet Category Surge Consumers are trying new products more often. Elevated visual and taste experiences dominate their preferences while shopping and consuming the product. The rate of new product launches suffered recently; however, long term consumer trends suggest rise in n
Slide 11: Sensient Color Group
Sensient Tech nologies: Lev el 1 Company Confidential Sensient Color Group
Slide 12: Color Group End Market Segments Overview
Color Group End Market Segments Overview Makeup Skin Care Fragrance Personal Care Hair Beverage Dairy Bakery Grocery Confection Pet Personal Care 2022 Revenue $165M OTC Nutraceutical Rx Color Group Segment 2022 Revenue $604M Food & Pharmaceutical 2022 Revenue $439M 12 2022 Revenues include intercomp
Slide 13: Sensient Food Colors
Sensient Tech nologies: Lev el 1 Company Confidential Sensient Food Colors
Slide 14: Food Colors
Sensient Food Colors The leading global food color house Customer base is across all major food market segments 14
Slide 15: Food Colors Strategic Pillars
Food Colors Strategic Pillars Sensient enables food and beverage manufacturers to benefit from the full potential of food color. We know how to refine the best color ingredients nature has to offer, make them perform well in food and beverages, and delight our customers with exceptional service. Adv
Slide 16: Food Colors – Expertise Across the Value Chain
Sensient Food Colors – Expertise Across the Value Chain APPLICATION EXPERTISE 14
Slide 17: Food Colors Natural Color Journey
Sensient Food Colors Natural Color Journey We are growing capabilities and capacity through a combination of R&D investments, acquisitions, capital investments, and agronomy development. Early 2010’s Expansion Natural Color Expansion Phase 1 – Globally 2023 Expansion Natural Color Expansion Phase 2
Slide 18: Food Colors Innovation Platforms
Sensient Food Colors Innovation Platforms Natural Blue Marine Blue Coloring Food Dispersions ‚Ultra Clean‘ Coloring Foods 14
Slide 19: Market Trends & Dynamics
Sensient Tech nologies: Lev el 1 Company Confidential Market Trends & Dynamics
Slide 20: Market Size Expected to Continue to Grow
Market Size Expected to Continue to Grow 20 Natural color market is expected to grow at a mid-single digit rate Natural color requires higher usage rate versus synthetic Natural color adoption outside of Europe will continue to drive market growth Consumer and regulatory trends contribute to ongoing
Slide 21: Consumer Demand For 'Less Artificial' is Evergreen Trend
Consumer Demand For ‘Less Artificial’ is Evergreen Trend 22
Slide 22: 80% of New Product Launches Use Natural Colors
80% of New Product Launches Use Natural Colors % of Food & Drink Product Launches Using Natural Color in 2022 % Increase from 2014 to 2022 22
Slide 23: Growth Opportunities for Sensient Food & Beverage
TiO2 is under scrutiny globally Consumer interest in better plant-based proteins remains Pet humanization driving conversion to natural colors Transition to natural colors is global Europe is undergoing a transition to coloring foods Market potential is 2x the size of the current TiO2 market Product
Slide 24: Sensient Personal Care
Sensient Tech nologies: Lev el 1 Company Confidential Sensient Personal Care
Slide 25: Personal Care Applications
Sensient Personal Care Applications Across all beauty applications Face Care Body Care Sun Care Make-up Hair Colour Hair Care Fragrance 25 Oral Care Personal Care
Slide 26: Sensient Personal Care Market Strategy Value Proposition
CSR program Run the Innovation Digitalization Regulatory Application Global trains on time support production Lead Driven by natural Use of digital Experts are at capabilities transparency and Service trends and tools to the forefront of Regional traceability excellence regulatory seamlessly new glo
Slide 27: Growth Opportunities for Sensient Personal Care
Color protection Solubilizer Surface treatment Biobased pigment Natural colors Many fragrance and personal care color protectors are blacklisted by our customers Market potential for color protectors is expected to expand Customers are starting to ban PEG polymer Products require higher usage to mee
Slide 28: Sensient Flavors & Extracts Group
Sensient Tech nologies: Lev el 1 Company Confidential Sensient Flavors & Extracts Group
Slide 29: It's a matter of TASTE
It’s a matter of TASTE 29 We partner with our customers to create delicious and visually appealing food and beverages with our team of experts and portfolio of solutions How Sensient Wins – Our Value Proposition Industry leading customer service KPIs, from samples and document turnaround, to OTIF an
Slide 30: Sensient Flavors & Extracts Group
We are a supplier of flavors, extracts, flavor ingredients, and technologies that meets the highest quality and service our customers demand. We are an agile organization and offer scalable capabilities in food & beverage categories. Sensient Flavors & Extracts Group Sweet Flavors & Extracts Inclusi
Slide 31: Capital Investment Strategy
Capital Investment Strategy 31 2014-2019 Phase I and Phase II 2020 2021 2022 2023 Restructuring Phases I & II: Consolidated and upgraded flavor production & technical sites Created US & Singapore Innovation Hubs Savory Flavors Capacity Expansion Divested Fruit Prep Business Acquisitions Flavor Solut
Slide 32: Getting Aroma, Sight, and Taste Right!
Getting Aroma, Sight, and Taste Right! Better taste and visual appeal Project work designed around end use product Complete end to end product development, from consumer insights to final prototype Experienced team lead by IFT Certified Foods Scientist Internal and external paneling capabilities Ful
Slide 33: Flavors & Extracts Technology Platforms
Sensient Flavors & Extracts Technology Platforms 33 BOOSTING Mask Undesirable Notes Add Characteristic Notes Boost Product Performance TECHNOLOGY SOLUTIONS ADDING Taste defining technologies and ingredients bring something new to enhance product performance. MASKING Technologies to help mask off not
Slide 34: End Market Segment and Growth Areas
End Market Segment and Growth Areas 34 Beverages One of the most dynamic flavor forward categories with low barrier to entry and diverse products Ice Cream & Novelties Globally, one of the largest segments with consistent growth and high product churn Bakery Category driven by routines and habits is
Slide 35: Appendix
Sensient Tech nologies: Lev el 1 Company Confidential Appendix* *Amounts in thousands, except percentages and per share amounts
Slide 36: Non-GAAP Financial Measures
Non-GAAP Financial Measures Year Ended December 31, Adjusted Adjusted 2022 Adjustments* 2022 2021 Adjustments* 2021 Revenue Flavors & Extracts $ 738,003 $ - $ 738,003 $ 739,427 $ (27,837) $ 711,590 Color 604,017 - 604,017 545,270 (2,080) 543,190 Asia Pacific 143,581 - 143,581 135,348 (295) 135,053 I
Slide 37: Non-GAAP Financial Measures
Non-GAAP Financial Measures 40 Diluted earnings per share (GAAP) Divestiture & other related (income) costs, net of tax Results of operations of the divested product lines, net of tax Operational improvement plan income, net of tax Adjusted diluted earnings per share $ 3.34 $ (0.04) - 2.81 18.9% 0.3
Slide 38: Non-GAAP Financial Measures
Non-GAAP Financial Measures 40 Revenue Total Foreign Exchange Rates Adjustments* Adjusted Local Currency Flavors & Extracts (0.2%) (2.2%) (3.8%) 5.8% Color 10.8% (3.8%) (0.4%) 15.0% Asia Pacific 6.1% (8.0%) (0.3%) 14.4% Total Revenue 4.1% (3.4%) (2.2%) 9.7% Operating Income Flavors & Extracts 6.9% (
Slide 39: Non-GAAP Financial Measures
Non-GAAP Financial Measures 40 2023 2022 % Change Operating income (GAAP) $ 102,429 $ 108,033 (5.2%) Depreciation and amortization 28,590 26,180 Share-based compensation expense 4,766 8,691 Adjusted EBITDA $ 135,785 $ 142,904 (5.0%) Six Months Ended June 30,
Slide 40: Non-GAAP Financial Measures
Non-GAAP Financial Measures 40 Revenue Total Exchange Rates Local Currency Flavors & Extracts (1.3%) 0.1% (1.4%) Color 5.6% (0.1%) 5.7% Asia Pacific 3.1% (3.8%) 6.9% Total Revenue 2.2% (0.4%) 2.6% Operating Income Flavors & Extracts (19.0%) 0.3% (19.3%) Color (1.2%) (0.5%) (0.7%) Asia Pacific 5.6% (
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