Slide 1: 2014 Shareholder Discussion Materials
2014 Shareholder Discussion Materials
Slide 2: Cautionary Note on Forward-Looking Statements
* Cautionary Note on 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, uncertaintie
Slide 3: Overview
Overview Sensient is executing a clear strategy to create sustainable, long-term shareholder value Sensient’s efforts have delivered record revenue and earnings each of the past 4 years The Company’s stock price is at a record high Sensient’s Board has a consistent record of implementing changes to
Slide 4: A Well-Positioned Leader in Flavors, Fragrances and Colors
A Well-Positioned Leader in Flavors, Fragrances and Colors Leading global developer, manufacturer and marketer of advanced color, flavor and fragrance systems Serves food, beverage, cosmetic, digital printing, pharmaceutical and other consumer and industrial applications Global operations serving in
Slide 5: Global Market Leader
* Global Market Leader Sensient is the global market leader in the food & beverage color market We also hold market leading positions in: Flavors Fragrances Cosmetic colors and ingredients Digital inks Pharma colors & coatings Industrial colors Global success a result of Board leadership & managemen
Slide 6: A Clear Strategy for Creating Value
A Clear Strategy for Creating Value Expanding in higher-margin, value-added products Leveraging technology platform to deliver innovative new solutions Continue implementing Flavors transformation following successful roadmap from Colors Group Transformation of Flavors & Fragrances Group into a prov
Slide 7: Enhancing Margins and ROIC through Aggressive Operating Actions
Enhancing Margins and ROIC through Aggressive Operating Actions * Completed restructuring in 2013, generating savings of $12 million Additional efforts announced in 2014 to reduce costs by $20 to $25 million by 2015 – focused on efficiencies in Flavors & Fragrances Reducing Costs Aligning with our C
Slide 8: Our Strategy has Proven Successful
Our Strategy has Proven Successful Execution of plan in Colors provides clear roadmap for success * 15% compound annual growth in operating income and 400 basis point improvement in return on assets in Colors
Slide 9: Committed to Returning Capital to Shareholders
Committed to Returning Capital to Shareholders Since the beginning of 2013 – Declared dividend increases of 14% Committed to 2 million share buyback in next 12 months * Expect to return ~$160 million to shareholders in next 12 months
Slide 10: Efficient Capital Allocation Drives Long-term Shareholder Value
Efficient Capital Allocation Drives Long-term Shareholder Value Reinvest in high ROIC projects within the Company Maintain a healthy dividend Keep debt levels in-line with an investment grade profile Opportunistic stock buybacks Evaluate acquisition opportunities * Sensient’s priorities aligned with
Slide 11: Sensient Benefits from Strong Balance Sheet
Sensient Benefits from Strong Balance Sheet Maintaining investment grade rating provides financial flexibility for CAPEX, buybacks / dividends and acquisitions Minimizes refinancing risk in volatile capital markets Sensient net debt to EBITDA in line with other ingredient firms serving the food & be
Slide 12: Delivering Clear Value to Shareholders
Delivering Clear Value to Shareholders * Stock Price % Increase: Jan. 1, 2013 – Mar. 14, 2014 Annualized Returns to Shareholders Annualized Returns to Shareholders 15 Year 9.0% 10 Year 13.8% 5 Year 23.6%
Slide 13: Commitment to Best-in-Class Corporate Governance
Commitment to Best-in-Class Corporate Governance Consistent Record of Shareholder-Friendly Actions * Board declassification Elimination of poison pill Long-term incentive compensation 100% performance based Director resignation policy Independent director added in 2013 Added lead director Amended di
Slide 14: Strong, Independent Board
Strong, Independent Board 7 Independent Directors Appointed Independent Lead Director Board members possess relevant experience: Food science and/or technical skills Industry knowledge Deep knowledge of the Company Significant corporate leadership experience in global businesses Finance, accounting
Slide 15: FrontFour is not the Right Choice
FrontFour is not the Right Choice Nominees lack qualifications and relevant experience Simplistic and inaccurate critique Vague call for unidentified cost reductions No clear plan for delivering operating improvements * FrontFour’s Approach Would Disrupt Our Progress
Slide 16: SXT Plan vs. FrontFour Proposal
SXT Plan vs. FrontFour Proposal * Sensient FrontFour Plan of Action Reinvest in business Specific, realistic cost reductions Prudent buyback Dividend increase Collaborative approach Cut internal investment Unspecified, unrealistic cost reductions Aggressive buyback Disruptive approach Credit Profile
Slide 17: Creating Shareholder Value
Creating Shareholder Value Proven track record Board holding management accountable for creating value Sensient is focused on: Strategy of developing and selling value-added customer solutions Operational improvements Optimizing capital structure Prudent capital allocation Maintaining best-in-class