Slide 1: Sensient Technologies Corporation Second Quarter 2024 Earnings Call
Sensient Technologies Corporation Second Quarter 2024 Earnings Call July 26, 2024
Slide 2: Non-GAAP Financial Measures
Non-GAAP Financial Measures Within this document, the Company reports certain non-GAAP financial measures, including: (1) adjusted operating income, adjusted net earnings, and adjusted diluted earnings per share, which exclude restructuring and other costs, including the Portfolio Optimization Plan
Slide 3: Forward Looking Statements
Forward Looking Statements This document contains statements that may constitute “forward-looking statements” within the meaning of Federal securities laws including under “2024 Financial Outlook” and "Business Initiatives and Outlook" in this presentation. Such forward-looking statements are not gu
Slide 4: Quarterly Results and Business Update
eo SENSIENT’ Quarterly Results and Business Update
Slide 5: Q2 2024 Consolidated Results
Q2 2024 Consolidated Results 5 (1) See appendix for our GAAP to Non-GAAP reconciliations.
Slide 6: Flavors & Extracts Group Performance
Flavors & Extracts Group Performance Local Currency Results Commentary 1 Revenue o Strong volume growth due to new wins o Revenue increased 11% during the quarter Operating Income o Impacted by elevated costs related to certain agricultural inputs in our natural ingredients product line Group Outloo
Slide 7: Color Group Performance
Color Group Performance Local Currency Results Commentary 1 Revenue o Increase in revenue driven by new wins o All product lines contributed to growth in the quarter Operating Income o Operating leverage returned due to improved volumes and sales mix Group Outlook Upgraded 2 o Mid-to high single-dig
Slide 8: Asia Pacific Group Performance
Asia Pacific Group Performance Local Currency Results Commentary 1 Revenue o Growth driven by increase in new sales win rate o Growth across most regions in the second quarter Operating Income o Growth driven by higher volumes in the Group in second quarter Group Outlook Upgraded 2 o High single-dig
Slide 9: Business Initiatives and Outlook
Business Initiatives and Outlook 1 Business Initiatives Consolidated Outlook Portfolio Optimization Plan Local Currency Revenue 2 o On track to deliver $8 to $10 million in annual o Growth rate of mid-to high single-digit savings, once fully implemented, by the end of 2025 Local Currency Adjusted EB
Slide 10: Innovative Natural Colors Support Growth
Innovative Natural Colors Support Growth Sensient has a portfolio of solutions to replace TiO2 and Red 3 Generally, replacements are not one-size-fits-all and require support from Sensient’s application experts Coupling our broad portfolio of replacements with our technical expertise ensures Sensien
Slide 11: Financial Update and Outlook
eo SENSIENT’ Financial Update and Outlook
Slide 12: Q2 2024 Financial Review
Q2 2024 Financial Review (dollars in thousands) Q2 2023 Q2 2024 Consolidated Commentary: Revenue $ 374,313 $ 403,525 Local Currency Revenue Growth1 +8.5% o Local currency revenue1 increased 8.5% Operating Income (GAAP) $ 51,591 $ 49,657 o Q2 2024 results included $1.8 million of Operating Margin 13.
Slide 13: 2024 Cash Flow and Debt Metrics
2024 Cash Flow and Debt Metrics YTD Commentary: Cash Flow from Operations $ 58.9 million o Cash flow from operations improved $7.2 million compared to 2023, primarily due to a continued focus on improving Capital Expenditures $ 22.9 million our inventory position Total Debt (as of June 30) $ 661.7 m
Slide 14: 2024 Financial Outlook
2024 Financial Outlook 1 Metric Updated Guidance Prior Guidance 2 Local Currency Revenue Mid-to high single-digit growth Mid-single-digit growth 2 Local Currency Adjusted EBITDA Mid-to high single-digit growth Mid-single-digit growth 3 Diluted EPS (GAAP) $2.77 to $2.87 $2.80 to $2.90 2 Local Currenc
Slide 15: —__S ss
—__S ss SENSIENT’
Slide 16: Appendix
Appendix 1 (1) Amounts in thousands, except percentages and per share amounts
Slide 17: Non-GAAP Financial Measures
Non-GAAP Financial Measures Three Months Ended June 30, 2024 2023 % Change Operating income (GAAP) $ 49,657 $ 51,591 (3.7%) Portfolio Optimization Plan costs – Cost of products sold 207 - Portfolio Optimization Plan costs – Selling and administrative expenses 1,545 - Adjusted operating income $ 51,4
Slide 18: Non-GAAP Financial Measures
Non-GAAP Financial Measures Three Months Ended June 30, 2024 Foreign Adjusted Exchange Local Revenue Total Rates Adjustments (1) Currency Flavors & Extracts 11.1% 0.0% N/A 11.1% Color 4.5% (0.7%) N/A 5.2% Asia Pacific 7.1% (4.0%) N/A 11.1% Total Revenue 7.8% (0.7%) N/A 8.5% Operating Income Flavors
Slide 19: Non-GAAP Financial Measures
Non-GAAP Financial Measures Three Months Ended June 30, 2024 Foreign Exchange Revenue Total Rates Local Currency Flavors, Extracts and Flavor Ingredients 0.8% 0.0% 0.8% Natural Ingredients 36.4% 0.0% 36.4% Flavors & Extracts Group 11.1% 0.0% 11.1% Food and Pharmaceutical 4.3% (0.4%) 4.7% Personal Ca
Slide 20: Non-GAAP Financial Measures
Non-GAAP Financial Measures Results by Segment Three Months Ended June 30, Adjusted Adjusted (1) (1) Operating Income 2024 Adjustments 2024 2023 Adjustments 2023 Flavors & Extracts $ 26,209 $ - $ 26,209 $ 24,456 $ - $ 24,456 Color 31,502 - 31,502 29,217 - 29,217 Asia Pacific 7,880 - 7,880 7,575 - 7,
Slide 21: Non-GAAP Financial Measures
Non-GAAP Financial Measures Three Months Ended June 30, 2024 2023 % Change Operating income (GAAP) $ 49,657 $ 51,591 (3.7%) Depreciation and amortization 15,016 14,440 Share-based compensation expense 2,916 2,499 Portfolio Optimization Plan costs, before tax 1,752 - Adjusted EBITDA $ 69,341 $ 68,530
Slide 22: Non-GAAP Financial Measures
Non-GAAP Financial Measures June 30, Debt 2024 2023 Short-term borrowings $ 26,995 $ 15,436 Long-term debt 634,663 686,589 (1) Credit Agreement adjustments (18,034) (19,755) Net Debt $ 643,624 $ 682,270 Operating income (GAAP) $ 151,657 $ 191,147 Depreciation and amortization 58,955 54,877 Share-bas